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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the registrant [x]
Filed by a party other than the registrant []
Check the appropriate box:
[] Preliminary proxy statement
[X] Definitive proxy statement
[] Definitive additional materials
[] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
ATWOOD OCEANICS, INC.
(Name of Registrant as Specified in Its Charter)
ATWOOD OCEANICS, INC.
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[] Fee computed on table below per Exchange Act Rules 14-a6(i)(4) and
0-11.
(1) Title of each class of securities to which transactions
applies: N/A
(2) Aggregate number of securities to which transaction
applies: N/A
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11: N/A
(4) Proposed maximum aggregate value of transaction: N/A
(5) Total Fee paid: N/A
[] Fee paid previously with preliminary materials
[] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid: N/A
(2) Form, schedule or registration statement no.: N/A
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(3) Filing party: N/A
(4) Date filed: N/A
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ATWOOD OCEANICS, INC.
15835 PARK TEN PLACE DRIVE
HOUSTON, TEXAS 77084
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
Houston, Texas
January 12, 1998
To the Shareholders of ATWOOD OCEANICS, INC.:
Notice is hereby given that, pursuant to the provisions of the Bylaws of Atwood
Oceanics, Inc., the Annual Meeting of the Shareholders of Atwood Oceanics, Inc.
will be held at the executive offices of Atwood Oceanics, Inc., 15835 Park Ten
Place Drive, in the City of Houston, Texas 77084, at 10:00 o'clock A.M., Houston
Time, on Thursday, February 12, 1998, for the following purposes:
1. To elect six (6) members of the Board of Directors for the
term of office specified in the accompanying Proxy Statement.
2. To act upon a shareholder proposal.
3. To transact such other business as may properly come before
the meeting or any adjournments thereof.
Shareholders of record at the close of business on December 31, 1997 will be
entitled to notice of and to vote at the Annual Meeting.
Shareholders are cordially invited to attend the meeting in person. Those who
will not attend are requested to sign and promptly mail the enclosed proxy for
which a stamped return envelope is provided.
By Order of the Board of Directors
JAMES M. HOLLAND, Secretary
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ANNUAL MEETING OF SHAREHOLDERS
ATWOOD OCEANICS, INC.
---------------
PROXY STATEMENT
---------------
January 12, 1998
SECURITY HOLDERS ENTITLED TO VOTE
Holders of shares of common stock, par value $1.00 ("Common Stock") of
Atwood Oceanics, Inc., (hereinafter sometimes called the "Company") of record at
the close of business on December 31, 1997 will be entitled to vote at the
Annual Meeting of Shareholders to be held February 12, 1998 at 10:00 o'clock
A.M., Houston Time, at the executive offices of Atwood Oceanics, Inc., 15835
Park Ten Place Drive, Houston, Texas, 77084 and at any and all adjournments
thereof.
Shareholders who execute proxies retain the right to revoke them at any
time before they are voted. A proxy, when executed and not so revoked, will be
voted in accordance therewith. This proxy material is first being mailed to
shareholders on January 12, 1998.
PERSONS MAKING THE SOLICITATION
This proxy is solicited on behalf of the Board of Directors of Atwood
Oceanics, Inc. In addition to solicitation by mail, the Company may request
banks, brokers and other custodians, nominees and fiduciaries to send proxy
material to the beneficial owners of stock and to secure their voting
instructions, if necessary. Further solicitation of proxies may be made by
telephone, telegram, or oral communication with some shareholders of the
Company, following the original solicitation. All such further solicitation will
be made by regular employees of the Company and the cost will be borne by the
Company.
VOTING SECURITIES
At the close of business on December 31, 1997, the time which has been
fixed by the Board of Directors as the record date for determination of
shareholders entitled to notice of and to vote at the meeting, there were
13,551,976 shares of Common Stock of the Company outstanding.
The election as directors of the persons nominated in this proxy
statement and approval of the shareholder proposal will require the vote of the
holders of a majority of the shares entitled to vote and represented in person
or by proxy at a meeting at which a quorum is present. Abstentions and broker
non-votes
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(which result when a broker holding shares for a beneficial owner has not
received timely voting instructions on certain matters from such beneficial
owner) are counted for purposes of determining the presence or absence of a
quorum for the transaction of business, but will operate to prevent the election
of the directors nominated in this Proxy Statement or the approval of such other
matters as may properly come before the meeting to the same extent as a vote
withholding authority to vote for the election of directors so nominated or a
vote against such other matters.
Each share of Common Stock entitles its owner to one vote except with
respect to the election of directors. With respect to the election of directors,
each shareholder has the right to vote in person or by proxy the number of
shares registered in his name for as many persons as there are directors to be
elected, or to cumulate such votes and give one candidate as many votes as shall
equal the number of directors to be elected multiplied by the number of his
shares, or to distribute the votes so cumulated among as many candidates as he
may desire. In the event of cumulative voting, the candidates for directors
receiving the highest number of votes, up to the number of directors to be
elected, shall be elected.
If a shareholder desires to exercise his right to cumulate votes for
directors, the laws of the State of Texas, the State in which the Company is
incorporated, require the shareholder to give the Secretary of the Company
written notice of such intention on or before the day preceding the meeting.
Such notice should be sent to: Atwood Oceanics, Inc., P. O. Box 218350, Houston,
Texas 77218, Attention: James M. Holland. If any shareholder gives such notice,
all shareholders have the right to use cumulative voting at the meeting. The
persons appointed by the enclosed form of proxy are not expected to exercise the
right to cumulate votes for election of the directors named elsewhere in this
Proxy Statement, although such persons shall have discretionary authority to do
so.
PRINCIPAL SHAREHOLDERS
The following table reflects certain information known to the Company
concerning persons beneficially owning more than 5% of the outstanding Common
Stock of the Company as of December 31, 1997 (except as otherwise indicated).
The information set forth below (other than with respect to Helmerich & Payne
International Drilling Co. and Helmerich & Payne, Inc.) is based on materials
furnished to the Company in connection with Securities and Exchange Commission
filings by or on behalf of the shareholders named below, as of various dates
during the Company's fiscal year and on information provided by CDA Equity
Intelligence in reports prepared for the Company. Unless otherwise noted, each
shareholder listed below has sole voting and dispositive power with respect to
the shares listed.
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Name and Address Shares Owned Percent
Beneficially of Class
Helmerich & Payne Intl. Drilling Co.(1) ------- 1,640,248 12.10%
Utica at 21st
Tulsa, Oklahoma
Helmerich & Payne, Inc.(1)--------------------- 1,559,752 11.51%
Utica at 21st
Tulsa, Oklahoma
FMR Corp. (2)---------------------------------- 964,800 7.12%
Edward C. Johnson 3d(2)
Abigail P. Johnson (2)
82 Devonshire Street
Boston, Massachusetts 02109
State Street Research & Management Co.(2)------ 724,400 5.35%
One Financial Center
31st Floor
Boston, Massachusetts 02111
- -------------------
(1) Walter H. Helmerich, III is Chairman and a director, and
Hans Helmerich, son of Walter H. Helmerich, III, is
President, Chief Executive Officer and a director,
respectively, of Helmerich & Payne, Inc. Messrs. Walter
H. Helmerich, III and Hans Helmerich, together with other
family members and the estate of W.H. Helmerich,
deceased, are controlling shareholders of Helmerich &
Payne, Inc., which with its wholly-owed subsidiary,
Helmerich & Payne International Drilling Co., owns of
record and beneficially 3,200,000 shares of Common Stock
of the Company. Messrs. Walter H. Helmerich, III and Hans
Helmerich have disclaimed beneficial ownership of the
Common Stock owned by these companies.
(2) The information set forth above concerning shares of
Common Stock beneficially owned by FMR Corp., Edward C.
Johnson 3d and Abigail P. Johnson was obtained from a
report dated December 23, 1997 prepared by CDA Equity
Intelligence for the Company. Amendment No. 8 to
Schedule 13G dated February 7, 1997 filed with the
Securities and Exchange Commission ("SEC") by FMR Corp.,
Edward C. Johnson 3d and Abigail P. Johnson indicated
that FMR Corp. had sole voting and dispositive powers and
Edward C. Johnson 3d and Abigail P. Johnson each had sole
dispositive power with respect to the shares owned.
(3) The information set forth above concerning shares of Common
Stock beneficially owned by State Street Research & Management
Co. ("State Street") was obtained from a report dated December
23, 1997 prepared by CDA Equity Intelligence for the Company.
Schedule 13G dated February 12, 1997 filed with the SEC by
State Street
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indicated that State Street had sole voting and dispositive
powers with respect to the shares owned, although State Street
disclaimed any beneficial interest therein.
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COMMON STOCK OWNED BY DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the amount of Common Stock beneficially
owned as of the close of business on December 31, 1997 by each of the directors,
by each of the named executive officers, and by all directors and executive
officers as a group. Unless otherwise indicated below, each of the named persons
and members of the group has sole voting and investment power with respect to
the shares shown.
Name of Director, Shares Owned Percent
Nominees or Group Beneficially of Class
Robert W. Burgess - 0.00%
George S. Dotson - 0.00%
Walter H. Helmerich, III (1) 0.00%
Hans Helmerich (1) 0.00%
William J. Morrissey 400 0.00%
John R. Irwin 30,200 (3) (2)
James M. Holland 13,384 (4) (2)
Larry P. Till 4,600 (5) (2)
Glen P. Kelley - 0.00%
All directors and executive officers
as a group (9 persons) 48,584 (6) (2)
- ------------
(1) See Note (1) on page 3 for more information.
(2) Less than 1%.
(3) Includes 30,000 shares which may be acquired upon the
exercise of options.
(4) Includes 11,250 shares which may be acquired upon the exercise
of options.
(5) All of such shares which may be acquired upon the exercise of
options.
(6) Includes 45,850 shares which may be acquired upon the exercise
of options.
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EXECUTIVE OFFICERS
Set forth below are the executive officers of the Company. The office
held, date of first election to that office and the age of each officer as of
the close of business on December 31, 1997 are indicated opposite his name.
Date of
First
Name Offices Held Election Age
John R. Irwin President and Chief March 52
Executive Officer 1993
James M. Holland Senior Vice President October 52
and Secretary 1988
Glen P. Kelley Vice President - October 49
Contracts and 1988
Administration
Larry P. Till Vice President - November 53
Operations 1992
No family relationship exists between any of the above
executive officers. All officers of the Company serve at the pleasure of the
Board of Directors and may be removed at any time with or without cause.
Mr. Irwin joined the Company in July 1979, serving as Operations
Manager - Technical Services. He was elected Vice President - Operations in
November 1980, Executive Vice President in October 1988, President and Chief
Operating Officer in November 1992, and President and Chief Executive Officer in
March 1993.
Mr. Holland joined the Company as Accounting Manager in April
1977. He was elected Vice President - Finance in May 1981 and
Senior Vice President and Secretary in October 1988.
Mr. Kelley rejoined the Company in January 1983 as Manager of
Operations Administration. He was elected Vice President -
Contracts and Administration in October 1988.
Mr. Till joined the Company in February 1983 as General
Manager - Technical. He was elected Vice President - Technical
Services in June 1984 and Vice President - Operations in November
1992.
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ITEM 1 - ELECTION OF DIRECTORS
At the meeting six (6) Directors (leaving one position vacant) are to
be elected for terms of one year each. Although the Company's Bylaws provide
that the Board of Directors consists of seven (7) persons, the Company has not
yet identified a suitable nominee to fill the vacancy. Accordingly, only six (6)
persons are nominated for election as directors, and shares may not be voted for
a greater number of persons than the number of nominees named.
The persons named in the enclosed form of proxy (James M. Holland and
Larry P. Till) have advised that they will vote all shares represented by
proxies for the election of the six nominees for Director listed below, unless
authority to so vote is withheld by the shareholder. Such persons will have the
discretion to cumulate the votes of the shares represented by proxy, although
the exercise of such discretion is not expected. If any of the nominees listed
below becomes unavailable for any reason, the shares represented by the proxies
will be voted for the election of such person, if any, as may be designated by
the Board.
Present Served as
Position a Director
with the Continuously Term to
Nominees Company Since Extend to Age
Robert W. Burgess Director September February 56
1990 1999
George S. Dotson Director February February 57
1988 1999
Walter H. Helmerich, III Director April February 74
1970 1999
Hans Helmerich Director February February 39
1989 1999
John R. Irwin Director, November February 52
President 1989 1999
and Chief
Executive
Officer
William J. Morrissey Director November February 70
1969 1999
At all times during the previous five years, Mr. Burgess has
served as Chief Financial Officer (Senior Vice President) for CIGNA
Investment Division, CIGNA Companies. CIGNA is a diversified
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financial services company with major businesses in insurance,
health care, pensions and investments. Mr. Burgess is not a
director of any other publicly traded company.
At all times during the previous five years, Mr. Dotson has served as
Vice President - Drilling of Helmerich & Payne, Inc. and President of Helmerich
& Payne International Drilling Co., both located in Tulsa, Oklahoma. Helmerich &
Payne, Inc. is a diversified natural resources company with divisions engaged in
drilling, exploration, production and real estate development. He serves as a
director of Helmerich & Payne, Inc., which as a result of its ownership of
Common Stock of the Company, may be deemed an affiliate of the Company.
At all times during the previous five years, Mr. Walter H. Helmerich,
III has served as the Chairman of the Board of Helmerich & Payne, Inc. of Tulsa,
Oklahoma, which as a result of its ownership of Common Stock of the Company, may
be deemed an affiliate of the Company. He is the father of Mr. Hans Helmerich,
who is also a director of the Company.
At all times during the previous five years, Mr. Hans Helmerich has
served as the Chief Executive Officer as well as a director of Helmerich &
Payne, Inc. of Tulsa, Oklahoma, which as a result of its ownership of Common
Stock of the Company, may be deemed an affiliate of the Company. He is a son of
Mr. Walter H. Helmerich, III.
Mr. Irwin has been employed by the Company in various
executive capacities for the last eighteen years. Mr. Irwin is not
a director of any other publicly traded company.
Mr. Morrissey served as Director and Vice Chairman of the
Board of Marine Corporation until the end of 1987 when Marine
Corporation was acquired by Banc One Corporation, Columbus, Ohio.
Mr. Morrissey is currently retired and is not a director of any
other publicly traded company.
The Company has standing Audit, Executive and Compensation committees.
The Audit Committee members are Messrs. Dotson and Morrissey. This Committee
functions to review in general terms the Company's accounting policies and audit
procedures and to supervise internal accounting controls. During fiscal 1997,
there was one meeting of the Audit Committee. The Executive Committee, composed
of Messrs. Dotson, Hans Helmerich and Irwin, meets frequently, generally by
telephone conference, for review of major decisions and to act as delegated by
the Board. The Compensation Committee's members, Messrs. Hans Helmerich, Burgess
and Dotson are responsible for administration of the Company's Stock Option
Plans, and for review and approval of all salary and bonus arrangements. During
fiscal 1997, there were two meetings of the Compensation Committee.
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There were four meetings of the Board of Directors held during fiscal
1997, all of which were regularly scheduled meetings. Each director attended,
during the time of his membership, at least seventy-five percent of Board and
Committee meetings.
Required Vote for Election of Directors
Election as directors of the persons nominated in this Proxy Statement
will require the vote of the holders of a majority of the shares of Common Stock
present or represented by proxy and entitled to vote at a meeting at which a
quorum is present. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ELECTION AS
DIRECTORS OF THE
PERSONS NOMINATED HEREIN.
ITEM 2 - SHAREHOLDER PROPOSAL
A shareholder, whose name, address and share ownership will be
furnished by the Company promptly upon request, has given notice of its
intention to introduce the following proposal at the Annual Meeting.
Shareholder Proposal and Supporting Statement
We believe the employee and board composition of major corporations
should reflect the people in the work force and marketplace of the 21st century
if our company is going to remain competitive. Our employees, customers and
stockholders are now made up of a greater diversity of backgrounds than ever
before. The report of the Department of Labor's 1995 bi-partisan Glass Ceiling
Commission, "Good For Business: Making Full Use of the Nation's Human Capital,"
confirms diversity and inclusiveness in the workplace has a positive impact on
the bottom line. A report of Standard and Poor 500 companies provided by
Covenant Fund revealed "...firms that succeed in shattering their own glass
ceiling racked up stock-market records that were nearly 2 1/2 times better than
otherwise - comparable companies."
In 1994 the Investor Responsibility Research Center reported
inclusiveness at senior management and board levels was only 9% of the Fortune
500 companies in a comparable work force of 57% diversity. The Glass Ceiling
Commission reported that companies are selecting from only half of the talent of
our work force. Therefore we urge our corporation to enlarge its search for
qualified board members by casting a wider net. If we are to be prepared for the
21st century we must learn how to compete in a growingly diverse global market
place by promoting and selecting the best people regardless of race, gender or
physical challenge. We believe the judgements and perspectives of a diverse
board would improve the
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quality of corporate decision-making.
Since the board is responsible for representing shareholder interests
in corporate meetings, a growing proportion of stockholders is now attaching
value to board inclusiveness. A 1994 Investor Responsibility Research Center
survey revealed 37% of respondents cited board diversity as the influencing
factor for
supporting votes.
The Teachers Insurance and Annuity Association and College Retirement
Equities Fund, the largest institutional investor in the United States, recently
issued a set of corporate governance guidelines including a call for "diversity
of directors by experience, sex, age and race."
Roger Campbell, CEO of Sun Oil, stated in the Wall Street Journal,
August 12, 1996, "Often what a woman or minority person can bring to the board
is some perspective a company hasn't had before--adding some modern day reality
to the deliberation process. Those perspectives are of great value, and often
missing from an all-white-male gathering. They can also be inspirational to the
company's diverse work force."
Be it resolved that shareholders request:
1. The nominating committee of the Board make a greater effort to find
qualified women and minority candidates for nomination to the Board.
2. The Board issue a statement publicly committing the company to a policy
of board inclusiveness with a program of steps to take and the timeline
expected to move in that direction.
3. The Company issue a report by September 1998 at a reasonable expense
that includes a description of:
a) efforts to encourage diversified representation on our
board
b) criteria for board qualification
c) the process of selecting the board candidates
d) the process of selecting the board committee members
Board of Directors' Response to Shareholder Proposal
The Company's Board of Directors unanimously recommends a vote AGAINST
the shareholder proposal.
Unlike many other public companies that have large boards of directors,
Atwood Oceanics, Inc. has taken a different approach. To maintain a
knowledgeable, effective and efficient board of directors and to avoid
unnecessary expenses, the number of
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directors on the Company's board has ranged from six to seven during the last
ten years and is currently six. During this period, the contract drilling
industry in which the Company competes has experienced significant challenges.
Many challenges still exist.
When selecting individuals for nomination to the Company's Board of
Directors, all qualified candidates are considered based on their knowledge of
and participation in the Company and the industry in which the Company operates.
The individuals currently on the Company's Board bring to bear a collective 90
years of experience with the Company in fulfilling their duties. The success of
the Company under the guidance of its Board is well documented. Under the
experienced leadership of the current Board during turbulent market conditions
of the 80's and early 90's, the Company maintained a strong balance sheet and
met all of its obligations. In recent years, the Company has been towards the
top of the industry in earnings per share and cash flow per share. During the
most recent fiscal year, the Company's market capitalization has increased from
approximately $300 million to $600 million. The Board is now challenged to
continue its successful leadership of the Company through the current cycle of
changing market conditions with increasing technological and financial
commitments.
The shareholder proposal would require the Board of Directors to make a
greater effort to find women and minority candidates, to issue a public
statement committing the Company to a policy of board inclusiveness and
establishing a timetable for achieving same, and to issue a report describing
its efforts, criteria and process of achieving board inclusiveness. Your Board
of Directors believes that the shareholder proposal (i) is inappropriately
restrictive, (ii) would unduly limit the Company in its selection of directors,
(iii) would involve significant costs without any benefit, and (iv) would
clearly be detrimental to the best interests of the Company and its
shareholders.
Required Vote for Approval of the Shareholder Proposal
Approval of the shareholder proposal requires the affirmative vote of
the holders of a majority of the shares of Common Stock present or represented
by proxy and entitled to vote at a meeting at which a quorum is present.
Shareholder proposals substantially identical to the proposal described above
were defeated at the 1995 and 1996 Annual Meetings of Stockholders, with 5.77%
of the shares present or represented and entitled to vote at the 1995 Annual
Meeting voting "for" approval of the shareholder proposal, 93.5% voting
"against" approval, and 0.28% abstaining, and 11.25% of the shares present or
represented and entitled to vote at the 1996 Annual Meeting voting "for"
approval of the shareholder proposal, 87.59% voting "against" approval, and
1.16% abstaining. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" APPROVAL OF
THE SHAREHOLDER PROPOSAL.
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EXECUTIVE COMPENSATION
In accordance with the Securities and Exchange Commission ("SEC")
executive compensation disclosure requirements under Item 402 of Regulation S-K,
the following compensation tables and other compensation information are
presented to enable shareholders to better understand the compensation of the
Company's executive officers.
The Company's executive compensation program is administered by the
Compensation Committee of the Board of Directors. The Committee is composed of
three independent, nonemployee directors. Following review and approval by the
Compensation Committee, all issues pertaining to executive compensation are
submitted to the full Board of Directors for approval.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS OF
ATWOOD OCEANICS, INC. (A)
To: The Board of Directors
As members of the Compensation Committee, it is our duty to review
compensation levels of Company's executive officers and administer the Company's
stock option plans.
Compensation Policies for Executive Officers
In determining the compensation of the Company's executive officers, it
is the policy of the Committee to take into account all factors which it
considers relevant to the determination, including business conditions
prevailing generally and in the Company's industry during such year, the
Company's performance in such year in light of such conditions, and the
performance of the specific officers under consideration and the business area
of the Company for which such officer is responsible.
For fiscal year ended September 30, 1997, the compensation program for
executive officers consisted primarily of base salary, year-end bonus, stock
option grants and Company contributions in a contributory retirement plan. The
Company's current compensation levels are within the $1 million limitation on
corporate tax deductions under Section 162(m) of the Internal Revenue Code of
1986, as amended, and the Company intends to take the necessary steps in
subsequent years to ensure that the Company's future compensation package will
comply with such limits on compensation deductibility.
Shareholders' equity continued to be enchanced during fiscal 1997
through the Company's improving financial trends. The Company has maintained an
equipment utilization rate in excess of 99
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percent over the last three fiscal years, with improving cash flows and
operating earnings. The Company's common stock price has likewise reflected a
significant increase in per share market value over the last three years. In
recognition of the significant improvement in operating performance, the Company
awarded bonuses (ranging from $15,000 to $80,000) and granted salary increases
to each of the Company's executive officers in December 1996 in addition to
granting certain stock options awards during fiscal 1997.
Chief Executive Officer Compensation
Mr. Irwin's compensation for fiscal year 1997 included a bonus of
$80,000 in addition to an increase of approximately 25 percent in his annual
base salary and the granting of certain stock options. Subsequent evaluations of
Mr. Irwin's compensation will be based upon the same criteria as set forth above
with respect to officers generally.
Compensation Committee
George S. Dotson
Robert W. Burgess
December 31, 1997 Hans Helmerich
- -------------------------
(A) Notwithstanding SEC filings by the Company that have
incorporated or may incorporate by reference other SEC
filings (including this proxy statement) in their
entirety, the Report of the Compensation Committee shall
not be incorporated by reference into such filings and
shall not be deemed to be "filed" with the SEC except as
specifically provided otherwise or to the extent required
by Item 402 of Regulation S-K.
Compensation Committee Interlocks and Insider Participation
No member of the Compensation Committee of the Board of Directors of
the Company was, during the 1996-7 fiscal year, an officer or employee of the
Company or any of its subsidiaries, or was formerly an officer of the Company or
any of its subsidiaries or had any relationships requiring disclosure by the
Company under Item 404 of Regulation S-K, except that Messrs. Dotson and
Helmerich are executive officers of Helmerich & Payne, Inc., with whom the
Company is a joint venture partner as described in "Related Transactions" below.
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During the Company's 1996-7 fiscal year, no executive officer of the
Company served as (i) a member of the compensation committee (or other board
committee performing equivalent functions) of another entity, one of whose
executive officers served on the Compensation Committee of the Board of
Directors, (ii) a director of another entity, one of whose executive officers
served on the Compensation Committee of the Company, or (iii) a member of the
compensation committee (or other board committee performing equivalent
functions) of another entity, one of whose executive officers served as a
director of the Company.
COMPENSATION TABLES
The SEC compensation disclosure rules require that various compensation
information be presented in various tables as set forth below.
Summary Compensation Table
Annual Compensation
Long Term
Compensation
(Awards)
Name and Securities
Principal Fiscal Other Annual Underlying All Other
Position Year Salary Bonus Compensation Options(A) Compensation(B)
- --------- ------ -------- ----- ------------ ----------- ------------
$ $ $ (#) ($)
John R. Irwin
President 1997 237,507 80,000 --- 12,000 26,161
and Chief 1996 194,550 30,000 --- 30,000 21,814
Executive 1995 174,150 25,000 --- --- 18,924
Officer
James M. Holland
Senior 1997 135,636 40,000 --- 8,000 15,309
Vice 1996 120,165 12,750 --- 16,000 13,762
President 1995 112,800 12,750 --- --- 13,323
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Larry P. Till
Vice 1997 137,445 15,000 --- 8,000 15,640
President - 1996 126,060 11,500 --- 6,000 14,547
Operations 1995 118,455 11,750 --- --- 13,888
Glen P. Kelley
Vice 1997 115,920 30,000 --- 8,000 12,982
President 1996 102,180 10,750 --- 16,000 11,608
Contracts - 1995 95,880 10,500 --- --- 10,648
and
Administration
- ---------------------------
(A) Retroactively adjusted to reflect two-for-one stock split declared in
November 1997.
(B) The amounts shown in the "All Other Compensation" column are derived
from the following: (i) Mr. Irwin: Annual Company contributions to the defined
contribution plan ("DCP") for 1997, 1996 and 1995 of $23,750, $19,403, and
$17,415, respectively; Company paid term life and insurance premiums ("TLIP")
for 1997, 1996 and 1995 of $2,411, $2,411, and $1,509, respectively; (ii) Mr.
Holland: Annual Company contributions to the DCP for 1997, 1996, and 1995 of
$13,563, $12,016, and $11,280, respectively; Company paid TLIP for 1997, 1996,
and 1995 of $1,746, $1,746, and $2,043, respectively; (iii) Mr. Till: Annual
Company contributions to the DCP for 1997, 1996, and 1995 of $13,774, $12,606,
and $11,845, respectively; Company paid TLIP for 1997, 1996, and 1995 of $1,866,
$1,941, and $2,043, respectively; (iv) Mr. Kelley: Annual Company contributions
to the DCP for 1997, 1996, and 1995 of $11,592, $10,218, and $9,588,
respectively; Company paid TLIP for 1997, 1996, and 1995 of $1,390, $1,390, and
$1,060, respectively.
Option Grants Table
Individual Grants Made in Fiscal 1997
Potential Realizable
Number of Value at Assumed Annual
Securities Percentage of Rates of Stock Price
Underlying Total Options Appreciation for
Options Granted To Exercise Option Term
Granted Employees in Price Expiration
Name (A)(#) Fiscal Year ($/Share) Date 5% ($) 10% ($)
- ---- ------------ ------------- --------- ------- ------- -------
Irwin 12,000 (B,C) 11.5% $28.00 4/2/2007 211,320 535,500
Holland 8,000 (B,C) 7.7% 28.00 4/2/2007 140,880 357,000
Till 8,000 (B,C) 7.7% 28.00 4/2/2007 140,880 357,000
Kelley 8,000 (B,C) 7.7% 28.00 4/2/2007 140,880 357,000
(A) The options were granted for a term of ten years, subject to earlier
termination in certain events related to termination of employment.
Twenty-five percent of such options become exercisable at each of two
years, three years, four years and five years, respectively, from the
date of grant. Subject to certain conditions, the exercise price may be
paid by delivery of already owned shares, and tax withholding
obligations related to exercise may be paid by offset of underlying
shares.
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Page 19
(B) These options were granted on April 3, 1997 pursuant to the Company's
1996 Incentive Equity Plan.
(C) Options granted were retroactively adjusted to reflect two-for-one stock
split declared in November 1997.
Option Exercises and Year End Value Table
Shares Number of
Acquired Securities
on Exercise Underlying
during Unexercised Value of Unexercised
Fiscal Value Options at In-the-Money Options
Name 1997 (A) Realized Sept. 30, 1997 (A) at Sept. 30, 1997 (B)
- ---- ------------ -------- ------------------ ---------------------
(#) ($) (#) ($)
Exercisable/ Exercisable/
Unexercisable Unexercisable
Irwin 23,000 643,413 30,000/49,000 $1,523,175/$1,834,689
Holland 22,000 615,600 11,250/28,950 $571,375/$1,086,587
Till 21,600 620,937 4,600/18,950 $230,758/$713,175
Kelley 10,050 316,524 2,250/28,950 $114,604/$1,086,587
- -------------
(A) Shares retroactively adjusted to reflect two-for-one stock split declared in
November 1997.
(B) Calculated based upon the September 30, 1997 fair market value of
$56.31 per share (adjusted to reflect the two-for-one stock split
declared in November 1997) less the share price to be paid upon
exercise. There is no guarantee that options will have the indicated
value if and when exercised.
ATWOOD OCEANICS, INC. COMMON STOCK PRICE PERFORMANCE GRAPH
Prior to 1997, the market index used in the stock price performance
graph was based upon the Center for research in Security Price ("CRSP") Index
for NASDAQ stocks. Since the Company ceased trading on the Nasdaq Stock Market
and commenced trading on the New York Stock Exchange ("NYSE") in August 1997, it
is management's opinion that a more accurate market index performance comparison
will be obtained through a market index that includes the NYSE, as well as the
American and Nasdaq stock markets. A common stock price performance graph
consistent with prior years index information, as well as a common stock pricing
performance graph based on a new market index, is set forth below:
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURNS* AMONG ATWOOD OCEANICS, INC.,
THE CRSP INDEX FOR NASDAQ STOCK MARKET, AND THE PEER GROUP OF DRILLING COMPANIES
GRAPH
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURNS* AMONG ATWOOD OCEANICS,
INC., THE CRSP INDEX FOR NYSE/AMEX/NASDAQ STOCK MARKET, AND THE PEER GROUP OF
DRILLING COMPANIES
GRAPH
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Page 20
Index Description 9/30/92 9/30/93 9/30/94 9/30/95 9/29/96 9/30/97
------- ------- ------- ------- ------- -------
ATWOOD OCEANICS, INC. 100.0 113.2 146.1 217.8 463.2 1185.5
CRSP Index for NASDAQ
Stock Market (U.S.
Companies) 100.0 131.0 132.1 182.4 216.4 297.1
CRSP Index for
NYSE/AMEX/NASDAQ
Stock Market 100.0 117.3 119.9 154.6 183.9 253.0
(U.S. Companies)
Self-Determined Peer Group 100.0 167.1 140.2 188.6 400.6 812.4
----------------------------------------------------
* Assumes $100 invested on September 30, 1992; Total returns assumes dividend
reinvested; Fiscal year ending September 30
Constituents of the Self-Determined Peer Group:
Diamond Offshore Drilling Inc.
Ensco International Inc. Falcon Drilling Company
Global Marine Inc. Marine Drilling Co. Inc.
Noble Drilling Corp. Reading & Bates Corp.
Rowan Companies, Inc. Transocean Offshore Inc.
<PAGE>
Page 21
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Officers, directors and greater than ten-percent shareholders are required by
the regulation to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely on its review of the copies of such forms received by it,
and written representations from certain reporting persons that no reports on
Form 5 were required for those persons, the Company believes that, during the
period from October 1, 1996 through September 30, 1997, all filing requirements
applicable to its officers, directors and greater than ten-percent beneficial
owners were complied with except that due to a delivery oversight, each of the
Company's executive officer made one late filing of a report, concerning three
transactions by Mr. Irwin, two transactions by Mr. Kelley and one transaction
each of Messrs.
Holland and Till.
RELATED TRANSACTIONS
Upon being awarded a term contract in August 1994, the Company entered
into a joint venture agreement with Helmerich & Payne, Inc. ("H&P") (which
together with its wholly-owned subsidiary, Helmerich & Payne International
Drilling Co., owns 23.61% of the Company's common stock) for the design,
construction and operation of RIG- 200, a new generation platform rig. The
construction of RIG-200 was completed in late 1995; however, due to project
delays in Australia unrelated to the Company's and H&P's activities, the rig was
not transported to Australia until late 1996. Drilling operations commenced in
January 1997. H&P managed the design, construction, testing and mobilization of
the rig, and the Company managed the initial installation and manages the daily
operations of the rig. The Company and H&P each have a fifty percent interest in
the joint venture. At September 30, 1997, the Company had invested approximately
$12 million in this project. Three of the Company's directors, namely Walter H.
Helmerich III, Hans Helmerich and George S. Dotson, are directors and executive
officers of H&P.
DIRECTORS COMPENSATION
As compensation for services as a director of the Company, each
director who is not an officer and full time employee of the Company or any of
its subsidiaries was paid in fiscal 1997 $2,500 per meeting for attendance at
regular Board meetings, and $250 per meeting for attendance at special Board and
committee meetings.
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Page 22
Commencing in fiscal 1998, the per meeting compensation has been increased to
$3,500.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The independent public accounting firm of Arthur Andersen LLP was
selected as auditors by the Company in 1970 and continues to serve in this
capacity. Representatives of Arthur Andersen LLP will be present at the
shareholders' meeting, will have the opportunity to make a statement if they so
desire and will be available to respond to appropriate questions.
SHAREHOLDER PROPOSALS
Proposals by Shareholders of the Company intended to be presented at
the next Annual Meeting of the Shareholders must be received by the Company on
or before September 13, 1998 in order to be included in the next Proxy Statement
and Form of Proxy relating to that meeting.
OTHER MATTERS
Management does not intend to bring any other matters before the
meeting and has not been informed that any matters are to be presented by
others. In the event any other matters properly come before the meeting, the
persons named in the enclosed form of proxy will vote the proxies in accordance
with their judgment on such matters.
If you do not contemplate attending the meeting in person, you are
respectfully requested to sign, date and return the accompanying proxy in the
enclosed, stamped envelope at your earliest convenience.
The Company will provide, without charge, upon written request of any
shareholder, a copy of its Annual Report on Form 10K including financial
statement schedules for the fiscal year ended September 30, 1997 as filed with
the Securities and Exchange Commission. Please direct such request to James M.
Holland, Secretary, Atwood Oceanics, Inc., P. O. Box 218350, Houston, Texas
77218.
By order of the Board of Directors
/s/ John R. Irwin, President
Houston, Texas
January 12, 1998
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Page 23
FRONT SIDE OF PROXY
ATWOOD OCEANICS, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF SHAREHOLDERS CALLED FOR
FEBRUARY 12, 1998
The undersigned, having received the Notice of Meeting and Proxy
Statement dated January 12, 1998, appoints James M. Holland and Larry P. Till
and each or either of them as proxies, with full power of substitution, to
represent the undersigned and to vote all shares of the Common Stock of Atwood
Oceanics, Inc. standing in the undersigned's name on its books on December 31,
1997 at the Annual Meeting of the Shareholders of the Company to be held
February 12, 1998, at the main offices of Atwood Oceanics, Inc., 15835 Park Ten
Place Drive, Houston, Texas 77084, 10:00 A.M., Houston Time, and any adjournment
thereof, as follows:
IF NO CONTRARY SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED WITH
AUTHORITY FOR THE ELECTION OF DIRECTORS AND AGAINST THE SHAREHOLDER PROPOSAL.
(PLEASE DATE AND SIGN ON REVERSE SIDE)
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Page 24
(BACK SIDE OF PROXY)
Please mark boxes in blue or black ink.
The proxies appointed herein may act by a majority of said proxies present at
the meeting (or if only one is present, by that one).
(1) ELECTION OF DIRECTORS PROPOSED BY THE COMPANY:
____FOR the nominees listed below ____WITHHOLD AUTHORITY for the
nominees listed below
NOMINEES:
ROBERT W. BURGESS WALTER H. HELMERICH, III WILLIAM J. MORRISSEY
GEORGE S. DOTSON HANS HELMERICH JOHN R. IRWIN
Authority to vote for any specific nominee for director may be withheld
by lining through or otherwise striking out such nominee's name.
The Board of Directors recommends a vote "AGAINST" item 2.
(2) SHAREHOLDER PROPOSAL
For Against Abstain
(3) In their discretion, upon other matters that may properly come before the
meeting.
Management knows of no other matters that may properly be, or which are
likely to be, brought before the meeting. The persons named in this proxy or
their substitutes will vote in accordance with the recommendations of management
on such matters.
- ------------- ----------------------------
Date Signature of Shareholder
----------------------------
Signature of Joint Shareholder NOTE: Please sign
exactly as name appears above. When signing as
attorney, executor, administrator, trustee or
guardian, please give full title. If stock is held in
the name of more than one person, each joint owner
should sign.
Please note any change of address.
<PAGE>
