SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14 (a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [x]
Filed by a party other than the registrant []
Check the appropriate box:
[ ] Preliminary proxy statement [ ] Confidential, for use of the
Commission Only (as permitted
by Rule 14a - 6(e) (2))
[x] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to 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):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(1)(1) and 0-11
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transcation:
(5) Total fee paid.
[ ] 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
(3) Filing Party: N/A
(4) Date Filed: N/A
<PAGE>
ATWOOD OCEANICS, INC.
15835 PARK TEN PLACE DRIVE
HOUSTON, TEXAS 77084
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
Houston, Texas
January 12, 2001
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 8, 2001, 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 approve a proposed amendment to the Company's 1996 Incentive Equity
Plan to include non-employee directors of the Company as eligible
participants as described in the accompanying Proxy Statement.
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 29, 2000
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
<PAGE>
ANNUAL MEETING OF SHAREHOLDERS
ATWOOD OCEANICS, INC.
---------------
PROXY STATEMENT
---------------
January 12, 2001
SECURITY HOLDERS ENTITLED TO VOTE
Holders of shares of common stock, par value $1.00 per share ("Common
Stock") of Atwood Oceanics, Inc., (hereinafter sometimes called the "Company")
of record at the close of business on December 29, 2000 will be entitled to vote
at the Annual Meeting of Shareholders to be held February 8, 2001 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, 2001.
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 29, 2000, 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
13,822,551 shares of Common Stock of the Company outstanding.
The election as directors of the persons nominated in this proxy
statement 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 (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 29, 2000 (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
("SEC") 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 Zacks
Investment Research, Inc. ("Zacks") 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.
Shares Owned Percent
Name and Address Beneficially of Class
---------------- ------------ ---------
Helmerich & Payne Intl. Drilling Co. (1) ------ 1,640,248 11.87%
Utica at 21st
Tulsa, Oklahoma 74114
Helmerich & Payne, Inc. (1)--------------------- 1,359,752 9.84%
Utica at 21st
Tulsa, Oklahoma 74114
Franklin Resources, Inc. (2)-------------------- 1,642,339 11.88%
Charles B. Johnson (2)
Rupert H. Johnson, Jr. (2)
Franklin Advisors, Inc. (2)
Franklin Advisory Services, Inc. (2)
Franklin Management, Inc. (2)
777 Mariners Island Blvd.
P.O. Box 7777
San Mateo, California 94403-7777
Invesco Funds Group, Inc. (3)------------------- 931,600 6.74%
7800 East Union Avenue
Denver, Colorado 80237
FMR Corp (4)------------------------------------ 689,000 4.98%
Edward C. Johnson (4)
Abigail P. Johnson (4)
-------------------
(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 3,000,000 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 Franklin Resources, Inc. ("FRI"), Charles B. Johnson
("CBJ"), Rupert H. Johnson, Jr. ("RHJ"), Franklin Advisors, Inc. ("FAI"),
Franklin Advisory Services, Inc. ("FASI") and Franklin Management, Inc. ("FMI"),
was obtained from a report dated December 27, 2000 prepared by Zacks for the
Company and Amendment No. 3 to Schedule 13G dated January 13, 2000 filed with
the SEC by FRI, CBJ, RHJ and FAI. Charles and Rupert Johnson are principal
shareholders of the outstanding common stock of Franklin Resources, Inc. FAI,
FASI and FMI are investment advisory subsidiaries of Franklin Resources, Inc.
FRI, CBJ and RHJ have no voting or dispositive power with respect to any shares
of the Company's Common Stock. FAI has sole voting and dispositive power with
respect to 1,382,000 shares of the Company's Common Stock. FASI has sole voting
power with respect to 66,800 shares and sole dispositive power with respect to
132,100 shares of the Company's Common Stock. FMI has no voting power and sole
dispositive power with respect to 49,962 shares of the Company's Common Stock.
(3) The information set forth above concerning shares of Common Stock
beneficially owned by Invesco Funds Group, Inc. ("Invesco") was obtained from a
report dated December 27, 2000 prepared by Zack for the Company. Based upon
reports prepared by Zacks, Invesco did not become a stockholder owning more than
5% of the outstanding Common Stock of the Company until some time during the
second half of 2000. The Company has not received any material from Invesco in
connection with SEC filings and thus, do not have any information on voting or
dispositive power that Invesco may have with respect to any shares of the
Company's Common Stock.
(4) 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 27, 2000 prepared by Zacks for the Company
and Amendment No. 13 to Schedule 13G dated October 10, 2000 filed with the SEC
by FMR Corp., Edward C. Johnson 3d and Abigail P. Johnson. FMR Corp. has sole
voting power with respect to 577,000 shares and sole dispositive power with
respect to all of the shares of the Company's Common Stock reported as
beneficially owned. Edward C. Johnson 3d and Abigail P. Johnson each has sole
dispositive power with respect to all of the shares reported as beneficially
owned.
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 29, 2000 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.
<PAGE>
Name of Director, Shares Owned Percent
Executive Officer 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 (2)
John R. Irwin 22,450 (3) (2)
James M. Holland 12,784 (4) (2)
Glen P. Kelley 19,300 (5) (2)
All directors and executive
officers as a group (8 persons) 54,934 (6) (2)
------------
(1) See Note (1) on page 3 for more information.
(2) Less than 1%.
(3) Includes 22,250 shares which may be acquired upon the exercise of options.
(4) Includes 10,650 shares which may be acquired upon the exercise of options.
(5) Includes 19,000 shares which may be acquired upon the exercise of options.
(6) Includes 51,900 shares which may be acquired upon the exercise of options.
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 29, 2000 are indicated opposite his name.
Date of
First
Name Offices Held Election Age
---- ------------ -------- -----
John R. Irwin President and Chief March 55
Executive Officer 1993
James M. Holland Senior Vice President October 55
and Secretary 1988
Glen P. Kelley Vice President - October 52
Contracts and 1988
Administration
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.
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
Glen P. Kelley) have advised that they will vote all shares represented by
proxies for the election of the six nominees for Director proposed by the
Company and 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.
<PAGE>
Present Served as
Position a Director
with the Continuously Term
Nominees Company Since Extend to Age
--------- -------- ------------ --------- -----
Robert W. Burgess Director September February 59
1990 2002
George S. Dotson Director February February 60
1988 2002
Walter H. Helmerich, III Director April February 77
1970 2002
Hans Helmerich Director February February 42
1989 2002
John R. Irwin Director, November February 55
President 1992 2002
and Chief
Executive
Officer
William J. Morrissey Director November February 73
1969 2002
Until his retirement in 1999, Mr. Burgess served for over five years as
Chief Financial Officer (Senior Vice President) for CIGNA Investment Division,
CIGNA Companies. CIGNA is a diversified financial services company with major
businesses in insurance, health care, pensions and investments.
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. He also
serves as a director of Varco International, Inc.
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 twenty-one years.
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.
The Company has standing Audit, Executive and Compensation committees. The
Audit Committee members are Messrs. Morrissey, Burgess and Dotson. This
Committee functions to review in general terms the Company's accounting policies
and audit procedures and to supervise internal accounting controls. The Audit
Committee held six meetings during fiscal 2000, of which four were telephone
conferences. The Executive Committee, composed of Messrs. Dotson, Hans Helmerich
and Irwin, meets frequently, generally by telephone conferences, 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 2000, there were
two meetings of the Compensation Committee.
Four meetings of the Board of Directors were held during fiscal 2000,
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.
<PAGE>
ITEM 2 PROPOSAL TO AMEND THE ATWOOD OCEANICS, INC. 1996 INCENTIVE EQUITY PLAN
The Atwood Oceanics, Inc. 1996 Incentive Equity Plan (the "Plan") was
adopted by the Board of Directors on December 5, 1996, and approved by the
stockholders on February 13, 1997. On September 9, 1999 the Board of Directors
approved Amendment No. 1 to the Plan, which did not require stockholder approval
and made technical changes to the provisions relating to transferability of
Non-Qualified Stock Options including the elimination of the requirement that
there be no consideration paid upon transfer of such options. On January 4,
2001, the Board of Directors adopted, subject to shareholder approval, Amendment
No. 2 to the Plan to include non-employee directors of the Company as eligible
participants in the Plan. There are currently six directors, of which five are
non-employee directors. The Board of Directors believes it is in the Company's
best interest to allow non-employee directors to participate in the Plan in
order to increase their interest in the Company's long term success, to provide
incentive equity opportunities which are competitive with other similarly
situated corporations, and to stimulate the efforts of such directors by giving
suitable recognition for services which contribute materially to the Company's
success. At the direction of the Board of Directors, the Company is offering
Amendment No. 2 for Stockholder approval. The principal features of the Plan
are summarized below. This summary does not purport to be a complete statement
of the Plan and is qualified in its entirety by reference to the Plan. A copy of
proposed Amendment No. 2 is attached as an Appendix to this Proxy Statement.
Purpose
The Plan is designed to encourage employee and officer ownership of the
Company's Common Stock and to assist the Company in attracting, retaining and
rewarding key personnel. The Plan currently does not cover non-employee
directors. The Plan authorizes the Compensation Committee to grant stock options
and restricted stock awards of Common Stock to eligible participants of the
Company and its subsidiaries and affiliates, during the term of the Plan which
is a period of 10 years from the date of shareholder approval of the Plan
(February 13, 1997.) Amendment No. 2 would authorize the Compensation Committee
to grant awards to non-employee directors, as well as to directors who are
employees. The awards to all non-employee directors would be set at 2,000
Non-Qualified Stock Options and would be awarded at the first meeting of the
Board of Directors following each such directors' election, re-election or
appointment, but no more than once per fiscal year during each year during the
remainder of the term of the Plan. No change would be made in regard to the
award of stock options or restricted stock to employees or officers or to the
general purpose of the Plan.
Shares Available
Originally, the total number of shares of Common Stock reserved and
available for distribution pursuant to stock options or restricted stock under
the Plan was 335,000 shares. However, on November 1997, the Company declared a
100% stock dividend. As a result of the stock dividend and pursuant to the terms
of the Plan, the number of shares of Common Stock reserved and available for
distribution pursuant to the Plan was increased to 670,000 (approximately 5% of
the outstanding Common Stock of the Company as of December 31, 2000). The Plan
provides that not more than 10% of such amount (or 67,000 shares) is available
for distribution pursuant to restricted stock under the Plan, in each case
subject to adjustment in the event of a future stock dividend, stock split,
merger, reorganization, consolidation, recapitalization. Shares underlying the
unexercised portion of any terminated or lapsed stock option and shares of
restricted stock which have been forfeited pursuant to applicable restrictions
are available for distribution in connection with future awards pursuant to the
Plan. As of September 30, 2000, 345,650 shares are outstanding under the Plan.
The closing price on the New York Stock Exchange as of December 29, 2000, of the
Company's Common Stock was $43.81 per share.
Administration
The Plan is administered by the Compensation Committee of the Board of
Directors, which consists solely of two or more non-employee directors who are
appointed by, and serve at the pleasure of, the Board. Under the Plan as
proposed to be amended, the Compensation Committee shall have the power and
authority to grant to eligible employees and officers stock options and
restricted stock as provided in the Plan, and to determine the terms and
conditions, not inconsistent with the terms of the Plan, of any award granted,
based on such factors and criteria as the Compensation Committee shall
determine, in its sole discretion. Further, the Plan would provide for
non-discretionary awards to non-employee directors in the amount of 2,000
Non-Qualified Stock Options to be awarded at the first meeting of the Board of
Directors following each such directors' election, re-election or appointment,
but no more than once per fiscal year during each year during the remainder of
the term of the Plan. Currently, the Compensation Committee has discretion in
granting awards to all eligible participants, but non-employee directors are not
eligible participants. Thus, the proposed amendment expands the pool of eligible
participants, but eliminates the Compensation Committee's discretion as it would
relate to the timing, type, and amount of award given to non-employee directors.
The Compensation Committee has the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as it shall,
from time to time, deem advisable; to interpret the terms and provisions of the
Plan and any award granted and any agreements relating thereto; and to otherwise
supervise the administration of the Plan.
<PAGE>
Eligibility
Currently, officers and employees of the Company, its subsidiaries and
its affiliates (but excluding members of the Compensation Committee and other
non-employee directors) who are responsible for or contribute to the management,
growth and/or profitability of the business of the Company, its subsidiaries or
its affiliates are eligible to be granted stock options and restricted stock
awards. All awards of stock options and restricted stock pursuant to the Plan
are made in consideration of the participant's contribution to the management,
growth and/or profitability of the Company and its subsidiaries. Under the Plan
as proposed to be amended, no changes would be made to the eligibility of
officers and employees, but all directors, including non-employee directors,
would be eligible for awards. However, the Compensation Committee would have no
discretion as to the timing, type, or amount of award granted to non-employee
directors.
Stock Options
The Plan permits the granting of options that either qualify as
Incentive Stock Options ("ISOs") under Section 422(b) of the Internal Revenue
Code of 1986, as amended (the "Code") or that do not so qualify ("Non-Qualified
Stock Options"). Options granted under the Plan are subject to the certain terms
and conditions set forth in the Plan and may contain such additional terms and
conditions not inconsistent with the terms of the Plan as the Compensation
Committee deems appropriate. The option exercise price for each share of Common
Stock covered by an option is to be determined by the Compensation Committee,
but shall be not less than the fair market value of such share on the date of
grant.
The term of each option will be fixed by the Compensation Committee,
but may not exceed 10 years from the date of grant in the case of an ISO or 10
years and one day after the date of grant in the case of a Non-Qualified Stock
Option. Options are exercisable at such time or times and subject to such terms
and conditions (including, without limitation, installment exercise provisions)
as shall be determined by the Compensation Committee, provided, however, that,
absent special circumstances, options shall not be exercisable prior to the
first anniversary date of grant. Vesting provisions limiting the exercisability
of options may be waived or accelerated at any time in whole or in part based on
such factors as the Compensation Committee may determine.
The option exercise price must be paid by certified or bank check or
other instrument acceptable to the Compensation Committee or, if the
Compensation Committee so determines, by delivery of shares of unrestricted
Common Stock valued at fair market value on the exercise date. Additionally,
payment of the exercise price may be made by delivery to the Company of an
executed irrevocable option exercise form together with irrevocable instructions
to a broker-dealer to sell a sufficient portion of the shares and deliver the
sale proceeds directly to the Company in satisfaction of the exercise price.
The Compensation Committee may, in its discretion, authorize all or a
portion of any Non-Qualified Stock Options to be granted on terms which permit
transfer by the participant to (i) the spouse, children or grandchildren of the
participant, (ii) a trust or trusts for the exclusive benefit of the spouse,
children or grandchildren of the participant, or (iii) a partnership in which
the spouse, children or grandchildren of the participant are the only partners;
provided in each case that (x) the stock option agreement pursuant to which such
stock options are granted must be approved by the Compensation Committee, and
must expressly provide for transferability in a manner consistent with this
section and (y) subsequent transfers of transferred options shall be prohibited
except those made in accordance with the transferability provisions of the Plan
or by will or by the laws of descent and distribution. Following transfer, any
such stock options shall continue to be subject to the same terms and conditions
as were applicable immediately prior to transfer. Except as set forth in the
Plan and in the applicable stock option agreement, no stock option shall be
transferable by the participant otherwise than by will or by laws of descent and
distribution, and all stock options shall be exercisable, during the
participant's lifetime, only by the participant.
Currently, the Plan refers to a participant's "employment" or
"termination of employment." If proposed Amendment No. 2 is approved, all such
references will be replaced with "employment or service" or "termination of
employment or service." Thus, all references to "employment or service" or
"termination of employment or service" in this summary correspond to references
to "employment" or "termination of employment" in the current Plan.
If a participant's employment or service by the Company or any
subsidiary or affiliate terminates by reason of death, long-term disability,
normal retirement or approved early retirement, any stock option held by such
participant may thereafter be exercised, to the extent it was exercisable at the
time of such termination or on such accelerated basis as the Compensation
Committee may determine at or after grant, for various periods up to three years
(or such shorter period as the Compensation Committee may specify at grant) from
the date of such termination of employment or service or until the expiration of
the stated term of such stock option, whichever period is shorter. If a
participant's employment or service by the Company or any subsidiary or
affiliate terminates voluntarily or involuntarily for any reason other than
death, long-term disability, normal retirement or approved early retirement, the
participant will have three months from the date of termination to exercise any
and all stock options that are then exercisable, except that, if the termination
was for "cause" (as defined in the Plan), any and all options shall be
immediately canceled.
<PAGE>
Restricted Stock
Shares of restricted stock may be issued either alone or in addition to
other awards granted under the Plan. The Compensation Committee determines the
officers and employees of the Company and its subsidiaries or affiliates to
whom, and the time or times at which, such grants will be made, the number of
shares to be awarded, the price (if any) to be paid by the recipient of an
award, the time or times within which such awards may be subject to forfeiture,
and all other conditions of the awards. The Compensation Committee may condition
grants of restricted stock upon the attainment of specified performance goals or
such other factors or criteria as the Compensation Committee may determine.
During the restriction period, the recipient shall have, with respect
to the shares of restricted stock covered by any award, all of the rights of a
shareholder of the Company, including the right to vote the shares, and the
right to receive any dividends, provided, however, that unless otherwise
determined by the Compensation Committee, any dividends on such shares shall be
automatically deferred and reinvested in additional restricted stock subject to
the same restrictions as the underlying award, to the extent shares are
available under the Plan. Except as otherwise provided in the Plan and the
applicable award agreement, during the restriction period established by the
Compensation Committee, the participant shall not be permitted to sell,
transfer, pledge, assign or otherwise encumber shares of restricted stock
awarded under the Plan. Based on service, performance and/or such other factors
or criteria as the Compensation Committee may determine, the Compensation
Committee may, however, at or after grant provide for the lapse of such
restrictions in installments and/or may accelerate or waive such restrictions in
whole or in part.
Except as otherwise provided in the Plan and the applicable award
agreement, upon termination of a participant's employment or service with the
Company or any subsidiary or affiliate for any reason during the restriction
period for a given award, all shares still subject to restriction shall be
forfeited by the participant, provided, however, the Compensation Committee may
provide for waiver of the restrictions in the event of termination of employment
or service due to death, long-term disability, normal retirement or approved
early retirement or in the event of hardship or other special circumstances of a
participant whose employment or service with the Company or any subsidiary or
affiliate is involuntarily terminated.
Change in Control Provisions
The Plan provides that in the event of a "Change in Control" (as
defined in the Plan), the Compensation Committee or the Board may provide that
(i) any or all stock options awarded under the Plan (to the extent outstanding
for at least six months) not previously exercisable and vested shall become
fully exercisable and vested; (ii) the restrictions applicable to any or all
restricted stock awards shall lapse and such shares and awards shall be fully
vested. In addition, at any time prior to or after a "Change in Control," the
Compensation Committee may accelerate awards and waive conditions and
restrictions on any awards to the extent it may determine to be appropriate.
Amendments and Termination
The Board may amend, alter, or discontinue the Plan at any time, but no
amendment, alteration, or discontinuation shall be made which would impair the
rights of a participant under a stock option or restricted stock award
theretofore granted, without the participant's consent, or which, without the
approval of the Company's stockholders, would, except as expressly provided in
the Plan, increase the total number of shares reserved for purposes of the Plan.
The Compensation Committee may amend the terms of any stock option or other
award theretofore granted, prospectively or retroactively, but no such amendment
shall impair the rights of any holder without the holder's consent. Subject to
certain conditions, the Board shall have the authority to amend the Plan to take
into account changes in applicable tax and securities law and accounting rules,
as well as other developments.
Federal Income Tax Consequences
The following summary is a description of the Federal income tax
consequences to the recipient and the Company of the issuance and exercise of
stock options and restricted stock granted pursuant to the Plan. The summary is
not intended to be exhaustive and does not attempt to be a comprehensive
description of all possible tax effects.
Incentive Stock Options. The grant of an ISO will not be treated as
taxable income to the participant for federal tax purposes, and will not result
in a deduction for the Company for tax purposes. On exercise of an ISO, the
participant will not recognize any taxable income, and the Company will not be
entitled to a deduction for tax purposes, although exercise of an ISO may give
rise to liability under the alternative minimum tax provisions of the Code. Upon
the sale or exchange of the shares at least two years after the grant date of
the option and one year after the exercise date, the participant will recognize
long-term capital in an amount equal to the excess of (i) the amount realized
upon the sale or other disposition of the purchased shares, over (ii) the
exercise price paid for such shares. If these holding periods are not satisfied,
the participant will recognize ordinary income (and the Company will be entitled
to a deduction for tax purposes) in an amount equal to the difference between
the exercise price and the lower of the fair market value of the shares on the
date the option was exercised, or the sale price of such shares. Any gain
recognized by the participant on such a premature disposition of the shares in
excess of the amount treated as ordinary income will be characterized as a
capital gain. A different rule for measuring ordinary income upon such a
premature disposition may apply if the participant is also an officer, director
or 10% shareholder of the Company.
Non-Qualified Stock Options. No income is realized by the participant
at the time a Non-Qualified Stock Option is granted. Upon exercise, the amount
by which the fair market value of the purchased shares on the exercise date
exceeds the option price will generally be taxable to the participant as
ordinary income and deductible by the Company for tax purposes. Upon disposition
of the shares, appreciation or depreciation after the exercise date is treated
as a short-term or long-term capital gain or loss to the participant and will
not result in any deduction by the Company.
Restricted Stock. In general, the recipient of a restricted stock award
will recognize ordinary income in the amount of any cash received plus the
market value of the shares on the date when the shares are no longer subject to
a substantial risk of forfeiture (as such term is defined in the Code) less any
amount paid for the shares, and the Company will be entitled to a deduction for
tax purposes in the same amount. If the recipient of a restricted stock award
makes a timely election under Section 83(b) of the Code to have the tax
liability determined at the time of the grant rather than when the restrictions
lapse, the recipient will recognize compensation income and the Company shall be
entitled to a deduction at that time, in an amount equal to the fair market
value of the shares on the grant date.
Deductibility of Compensation. The Company anticipates that any
compensation deemed paid by the Company to its executive officers as a result of
stock options or restricted stock will remain deductible by the Company and will
either (a) not have to be taken into account for purposes of the $1 million
limitation per covered individual on the deductibility of the compensation paid
to certain executive officers of the Company, or (b) will not cause such limit
to be exceeded. The Company anticipates that compensation to directors in such
capacity will be deductible as compensation for personal services.
Withholding. No later than the date as of which an amount first becomes
includible in the gross income of the participant for Federal income tax
purposes with respect to any stock option or other award under the Plan, the
participant shall pay to the Company, or make any arrangements satisfactory to
the Compensation Committee regarding the payment of any Federal, state or local
taxes of any kind required by law to be withheld with respect to such amount.
Unless otherwise determined by the Company, withholding obligations may be
settled with Common Stock, including Common Stock that is part of the award that
gives rise to the withholding requirement. Generally, the Company will not
withhold any amount from awards made to directors in such capacity, as those
awards are treated as self-employment income, and, as such, are not subject to
withholding.
Awards Pursuant to the Plan
If (i) Amendment No. 2 to the Plan receives shareholder approval, (ii)
the nominees proposed by the Company for the Board of Directors are elected at
the annual shareholders meeting, and (iii) each nominee who is not currently an
employee of the Company does not become an employee of the Company by the time
of award, the following awards to the persons indicated would be made at the
first meeting of the Board of Directors following each directors' election or
re-election:
<TABLE>
1996 Incentive Equity Plan
------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Name and Position Dollar Value Number of Units
----------------- ------------ ----------------
Robert W. Burgess - Director undetermined (A) 2,000 non-qualified stock options
Compensation Committee
George S. Dotson - Director undetermined (A) 2,000 non-qualified stock options
Compensation Committee
W.H. Helmerich, III - Director undetermined (A) 2,000 non-qualified stock options
Hans Helmerich - Director undetermined (A) 2,000 non-qualified stock options
Compensation Committee
William J. Morrissey - Director undetermined (A) 2,000 non-qualified stock options
-----------
</TABLE>
(A) The exercise price of the Non-Qualified Stock Options will not be set
until the date of grant. Thus, the value will vary with the fair market value of
the Company's Common Stock.
As non-employee directors are not executive officers of the Company, no
executive officers would be guaranteed Stock Options as a result of Amendment
No. 2 to the Plan, should it receive shareholder approval. All other awards
under the Plan are at the discretion of the Compensation Committee.
Required Vote for Approval of Amendment No. 2 to the Atwood Oceanics, Inc.
1996 Incentive Equity Plan
Approval of Amendment No. 2 to the 1996 Incentive Equity Plan 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" ADOPTION OF AMENDMENT
NO. 2 TO THE 1996 INCENTIVE EQUITY PLAN.
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 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 the Company's executive officers and to 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, 2000, 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 was significantly enhanced during fiscal 1998,1999
and 2000 due to the Company's revenues, cash flows and net profit for the period
being at their highest levels in the Company's history. In recognition of the
Company's continued strong operating performance, the Company awarded bonuses
(ranging from $35,000 to $85,000) and granted salary increases to each of the
Company's executive officers of approximately 5% in December 1999.
Chief Executive Officer Compensation
Mr. Irwin's compensation for fiscal year 2000 included a bonus of
$85,000. In addition, the Company increased Mr. Irwin's annual base salary by
approximately 5% in December 1999. The evaluation of Mr. Irwin's compensation
was based upon the same criteria as set forth above with respect to officers
generally.
Compensation Committee
George S. Dotson
Robert W. Burgess
Hans Helmerich
December 31, 2000
-------------------------
(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 2000 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,
and which, as a result of its ownership of Common Stock of the Company, may be
deemed an affiliate of the Company.
During the Company's 1999-2000 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 Company, (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.
<TABLE>
SUMMARY COMPENSATION TABLE
-------------------------------------------------------------------------------------------------------------------------------
Annual Compensation
<S> <C> <C> <C> <C> <C> <C>
Long Term
Compensation
Awards:
Securities
Fiscal Other Annual Underlying All Other
Name and Principal Position Year Salary Bonus Compensation Options Compensation (A)
--------------------------- ----- ------ ----- --------------- ----------- ------------------
$ $ $ (#) ($)
John R. Irwin 2000 306,250 85,000 --- 15,000 33,552
President and Chief 1999 290,007 100,000 --- --- 31,927
Executive Officer 1998 268,755 100,000 --- 30,000 29,802
James M. Holland 2000 176,376 40,000 --- 9,000 19,784
Senior Vice President 1999 167,503 50,000 --- --- 18,896
and Secretary 1998 155,049 50,000 --- 19,000 17,651
Glen P. Kelley 2000 156,003 35,000 --- 8,000 17,390
Vice President - Contracts 1999 147,500 40,000 --- --- 16,540
and Administration 1998 135,000 40,000 --- 16,000 15,290
Larry P. Till 2000 --- --- --- --- ---
Vice President - Operations 1999 156,750 40,000 --- --- 17,941
(Retired in September 1999) 1998 147,660 30,000 --- 14,000 17,032
---------------------------
</TABLE>
(A) 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 2000, 1999, and 1998 of $30,625, $29,000 and $26,875,
respectively; Company paid term life and insurance premiums ("TLIP") for 2000,
1999 and 1998 of $2,927, $2,927 and $2,927, respectively;
(ii) Mr. Holland: Annual Company contributions to the DCP for 2000, 1999
and 1998 of $17,638, $16,750 and $15,505, respectively; Company paid TLIP for
2000, 1999 and 1998 of $2,146, $2,146 and $2,146, respectively
(iii) Mr. Kelley: Annual Company contributions to the DCP for 2000, 1999
and 1998 of $15,600, $14,750 and $13,500, respectively; Company paid TLIP for
2000, 1999 and 1998 of $1,790, $1,790 and $1,790, respectively;
(iv) Mr. Till: Annual Company contributions to the DCP for 1999, 1998 of
$15,675 and $14,766, respectively; Company paid TLIP for 1999 and 1998 of $2,266
and, $2,266, respectively.
<PAGE>
<TABLE>
OPTION GRANTS TABLE
Individual Grants Made in Fiscal 2000
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Number of Potential Realizable Value
Securities Percentage of at Assumed Annual
Underlying Total Options Rates of Stock Price
Options Granted To Appreciation for Option Term
Granted Employees in Exercise Price Expiration ----------------------------
Name (A)(#) Fiscal Year ($/Share) Date 5% ($) 10% ($)
---- ---------- ------------- -------------- ---------- -------- --------
Irwin 15,000(B) 15.46% $37.75 12/1/2009 358,950 902,700
Holland 9,000(B) 9.28% 37.75 12/1/2009 215,370 541,620
Kelley 8,000(B) 8.25% 37.75 12/1/2009 191,440 481,440
</TABLE>
----------
(A) The options were granted for a term of ten years, subject to earlier
termination in certain events related to termination of employment. Twenty-five
percent of such options become exercisable at each of two years, three years,
four years and five years, respectively, from the date of grant. Subject to
certain conditions, the exercise price may be paid by delivery of already owned
shares, and tax withholding obligations related to exercise may be paid by
offset of underlying shares.
(B) These options were granted on December 2, 1999 pursuant to the
Company's 1996 Incentive Equity Plan.
<TABLE>
OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION VALUE TABLE
<S> <C> <C> <C> <C>
Number of
Securities
Underlying
Shares Acquired Unexercised Value of Unexercised
on Exercise during Value Options at In-the-Money Options
Name Fiscal 2000 Realized Sept. 30, 2000 at Sept. 30, 2000 (A)
----- ------------------ --------- -------------- ----------------------
(#) ($) (#) ($)
Exercisable/ Exercisable/
Unexercisable Unexercisable
-------------- ----------------
Irwin 52,000 2,528,201 18,500 / 51,000 286,429 / 589,567
Holland 20,500 887,918 8,150 / 31,350 115,878 / 347,856
Kelley 5,000 211,016 17,000 / 28,000 311,117 / 325,777
</TABLE>
---------
(A) Calculated based upon the September 30, 2000 fair market value of $41.69 per
share less the share price to be paid upon exercise. There is no guarantee that
options will have the indicated value if and when exercised.
<PAGE>
AUDIT COMMITTEE REPORT
In accordance with the SEC Audit Committees communication requirements
under Item 306 of Regulation S-K, the following information is presented to
inform shareholders of the Audit Committees oversight with respect to financial
reporting.
Audit Committee Charter
The members of the Audit Committee are governed by a Charter duly
adopted by the Board of Directors, which requires their independence from
management of the Company or their freedom from any other relationship which
would interfere with their independent judgment. A copy of the Audit Committee
Charter is attached as Appendix B to this Proxy Statement.
Report of the Audit Committee of the Board of Directors of ATWOOD OCEANICS, INC.
To: The Board of Directors
We have reviewed and discussed with management the Company's audited financial
statements as of and for the year ended September 30, 2000.
We have discussed with the independent auditors the matters required to be
discussed by Statement on Auditing Standards No. 61, Communication with Audit
Committees, as amended, by the Auditing Standards Board of the American
Institute of Certified Public Accountants.
We have received and reviewed the written disclosures and the letter from the
independent auditors required by Independence Standard No. 1, Independence
Discussions with Audit Committees, as amended, by the Independence Standards
Board, and have discussed with the auditors the auditors' independence.
Based on the reviews and discussions referred to above, we recommend to the
Board of Directors that the financial statements referred to above be included
in the Company's Annual Report on Form 10-K for the year ended September 30,
2000.
Audit Committee
William J. Morrissey, Chairman
Robert W. Burgess, Member
George S. Dotson, Member
December 31, 2000
<PAGE>
ATWOOD OCEANICS, INC. COMMON STOCK PRICE PERFORMANCE GRAPH
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURNS* AMONG ATWOOD
OCEANICS, INC., AND THE CENTER FOR RESEARCH IN SECURITY PRICES ("CRSP") INDEX
FOR THE NYSE/AMEX/NASDAQ STOCK MARKETS, AND THE PEER GROUP OF DRILLING
COMPANIES.
GRAPH
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Index Description 9/30/95 9/29/96 9/30/97 9/30/98 9/30/99 9/30/00
------- ------- ------- ------- ------- -------
ATWOOD OCEANICS, INC. 100.0 212.7 544.4 201.2 295.5 403.0
CRSP Index for
NYSE/AMEX/NASDAQ Stock Markets (U.S.
Companies) 100.0 119.0 163.7 169.5 216.2 255.9
Self-Determined Peer Group 100.0 212.7 423.5 175.2 223.7 419.3
-
</TABLE>
Constituents of the Self-Determined Peer Group (weighted according to market
capitalization):
Diamond Offshore Drilling Inc.
Ensco International Inc. R & B Falcon Corp.
Global Marine Inc. Marine Drilling Co. Inc.
Noble Drilling Corp. Transocean Sedco Forex Inc.**
Rowan Companies, Inc.
* Assumes $100 invested on September 29, 1995; Total returns assumes dividend
reinvested; Fiscal year ending September 30.
** Transocean Offshore Inc. merged with Sedco Forex in December 1999 to
form Transocean Sedco Forex Inc.
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, 1999 through September 30, 2000, all filing requirements
applicable to its officers, directors and greater than ten-percent beneficial
owners were complied with.
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 21.71% 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, with the contract terminating in June 1999. The rig is currently
cold-stacked in Australia. H&P managed the design, construction, testing and
mobilization of the rig, and the Company managed the initial installation and
the daily operations of the rig. The Company and H&P each have a fifty percent
interest in the joint venture. The Company 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 2000 $3,500 per meeting for attendance at
regular Board meetings, and $250 per meeting for attendance at meetings of the
audit committee if held on a day other than a regular Board meeting.
<PAGE>
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
The independent public accounting firm of Arthur Andersen & Co. was
selected as auditors by the Company in 1970 and continues to serve in this
capacity. Representatives of Arthur Andersen & Co. 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 of shareholders of the Company intended to be presented for
consideration at the Annual Meeting of Shareholders of the Company to be held in
February, 2002 must be received by the Company no later than September 14, 2001
and must comply with the requirements of the proxy rules promulgated by the
Securities and Exchange Commission in order to be included in the proxy
statement and form of proxy related to that meeting. If notice of any
shareholder proposal not eligible for inclusion in the Company's proxy statement
and form of proxy is given to the Company after November 28, 2001, then proxy
holders will be allowed to use their discretionary voting authority on such
shareholder proposal when the matter is raised at such 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 under
discretionary authority therein 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 10-K including financial
statements and financial statement schedules for the fiscal year ended September
30, 2000 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, 2001
<PAGE>
APPENDIX A
AMENDMENT NO. 2
TO THE
ATWOOD OCEANICS, INC.
1996 INCENTIVE EQUITY PLAN
Pursuant to the terms and provisions of Section 9 of the Atwood Oceanics,
Inc. 1996 Incentive Equity Plan (the "Plan"), Atwood Oceanics, Inc., a Texas
corporation (the "Company"), hereby adopts the following Amendment No. 2 to the
Plan ("Amendment No. 2").
1.
Section 1 of the Plan is hereby amended in its entirety by substituting
the following therefor:
"The 1996 Incentive Equity Plan (the "Plan") is intended to
encourage employees, officers, and directors (including Non-Employee Directors)
of Atwood Oceanics, Inc. (the "Company") and its Subsidiaries or Affiliates to
become owners of Stock of the Company in order to increase their interest in the
Company's long-term success, to provide incentive equity opportunities which are
competitive with other similarly situated corporations and to stimulate the
efforts of such employees, officers and directors (including a Non-Employee
Director) by giving suitable recognition for services which contribute
materially to the Company's success."
2.
Section 3 of the Plan is hereby amended in its entirety by substituting
the following therefor:
"(a) The Plan shall be administered by the Compensation Committee of the
Board of Directors, which shall consist solely of two or more Non-Employee
Directors who are appointed by, and serve at the pleasure of, the Board. The
Committee shall have the power and the authority to grant to eligible
participants Stock Options and Restricted Stock.
(2) In particular, the Committee shall have the authority:
(1) to select the employees and officers of the Company, its
Subsidiaries and Affiliates to whom Stock Options and other awards
may from time to time be granted;
(2) to determine whether and to what extent Stock Options and
Restricted Stock are granted;
(3) to determine the number of shares to be covered by each such award
granted;
(4) to determine the terms and conditions, not inconsistent with the
terms hereof, of any award granted (including, but not limited to,
the share price and any restriction or limitation on, or any
vesting, acceleration or forfeiture waiver regarding, any award,
based on such factors and criteria as the Committee shall
determine, in its sole discretion); and
(5) to determine and adjust the performance goals and measurements
applicable to performance-based Restricted Stock awards to include
or exclude the impact of extraordinary or unusual items, events or
circumstances and/or to reflect change in applicable tax or
accounting rules and other developments.
(3) Notwithstanding anything in the Plan to the contrary, and subject to
the provisions of Section 5 and 6 of the Plan and the availability
under the Plan of a sufficient number of shares of Common Stock that
may be issuable upon the exercise of outstanding Stock Options, the
Committee shall award, to each Non-Employee Director of the Company
2,000 Non-Qualified Stock Options.
The award of Non-Qualified Stock Options to Non-Employee Directors
shall be made at the first meeting of the Board of Directors following
each directors' election, re-election or appointment, but no more than
once per fiscal year during each year during the Term of the Plan as
set forth in Section 13.
(4) The Committee shall have the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as it
shall, from time to time, deem advisable; to interpret the terms and
provisions of the Plan and any award granted and any agreements
relating thereto; and to otherwise supervise the administration of the
Plan. All decisions made by the Committee pursuant to the provisions
hereof shall be made in the Committee's sole discretion and shall be
final and binding on all persons."
3.
Section 4 of the Plan is hereby amended in its entirety by substituting
the following therefor:
"Employees, officers and directors (including Non-Employee Directors)
of the Company, its Subsidiaries and its Affiliates who are responsible for or
contribute to the management, growth, and/or profitability of the business of
the Company, its Subsidiaries or its Affiliates are eligible to be granted Stock
Options and/or Restricted Stock Awards. Employee and officer participants under
the Plan shall be selected from time to time by the Committee, in its sole
discretion, from among those eligible. Non-Employee Director participants shall
be awarded Stock Options as provided in Section 3(c) above."
4.
The second paragraph of Section 6 of the Plan shall be amended in its
entirety by substituting the following therefor:
"Stock Options granted under the Plan may be of two types: (i)
Incentive Stock Options; and (ii) Non-Qualified Stock Options (provided that
Incentive Stock Options may not be granted to (x) employees, officers, or
directors of Affiliates or (y) to directors of the Company in such capacity).
The Committee may grant to any participant, except as provided in the preceding
sentence, Incentive Stock Options, Non-Qualified Stock Options, or both types of
Stock Options. To the extent that any Stock Option does not qualify as an
Incentive Stock Option, it shall constitute a separate Non-Qualified Stock
Option."
5.
Any and all references in the Plan to "employment" or "termination of
employment," including without limitation references in the definition of
"Retirement," and in Sections 6 and 7 of the Plan, shall be replaced with a
reference to "employment or service" or "termination of employment or service,"
as applicable.
6.
Subsection (b) of Section 11 of the Plan shall be amended in its
entirety by substituting the following therefor:
"(b) Nothing contained in this Plan shall prevent the Company, a
Subsidiary or an Affiliate from adopting other or additional
compensation arrangements for its employees, officers, and
directors (including Non-Employee Directors)."
7.
Each amendment made by this Amendment No. 2 to the Plan has been
effected in conformity with the provisions of the Plan and with applicable law.
8.
This Amendment No. 2 was adopted by the Board of Directors of the Company
on January 4, 2001 and approved by the shareholders of the Company on February
____, 2001.
Dated: February ____, 2001
ATWOOD OCEANICS, INC.
By:
-----------------
James M. Holland
Senior Vice President
<PAGE>
APPENDIX B
ATWOOD OCEANICS, INC.
AUDIT COMMITTEE CHARTER
ORGANIZATION
There shall be a committee of the board of directors to be known as the audit
committee. The audit committee, comprised of at least three directors, shall be
appointed by the board and shall be composed of directors who are independent of
the management of the corporation and are free of any relationship that, in the
opinion of the board of directors, would interfere with their exercise of
independent judgment as a committee member. Each member of the audit committee
shall be financially literate and at least one member of the audit committee
must have accounting or related financial management expertise, as the Board of
Directors interprets such qualification in their business judgment.
STATEMENT OF POLICY
The audit committee shall provide assistance to the corporate directors in
fulfilling their responsibility to the shareholders, potential shareholders, and
investment community relating to corporate accounting, reporting practices of
the corporation, and the quality and integrity of the financial reports of the
corporation. In so doing, it is the responsibility of the audit committee to
maintain free and open means of communication between the directors, the
independent auditors, and the financial management of the corporation.
RESPONSIBILITIES
The policies and procedures of the audit committee in carrying out its
responsibilities should remain flexible, in order to best react to changing
conditions and to ensure to the directors and shareholders that the corporate
accounting and reporting practices of the corporation are in accordance with all
requirements and are of the highest quality.
In carrying out these responsibilities, the audit committee will:
o Meet at least four times per year or more frequently as circumstances
require. The committee may ask members of management or others to attend
the meeting and provide pertinent information as necessary.
o Review and recommend to the directors the independent auditors to be
selected to audit the financial statements of the corporation and its
subsidiaries, which firm is ultimately accountable to the board of
directors and the audit committee.
o Meet with the independent auditors and financial management of the
corporation to review the scope of the audit for the current year and
the audit procedures to be utilized, and at the conclusion thereof,
review the results of such audit, including any comments or
recommendations of the independent auditors.
o Review with the independent auditors and financial and accounting
personnel, the adequacy and effectiveness of the accounting and
financial controls of the corporation, and elicit any recommendations
for the improvement of such internal control procedures or particular
areas where new or more detailed controls or procedures are desirable.
Receive and review periodic reports from financial management on the
status of implementation of recommendations to improve internal
controls. Particular emphasis should be given to the adequacy of such
internal controls to expose any payments, transactions, or procedures
that might be deemed illegal or otherwise improper.
o Review with management and the independent auditors at the completion of
the annual examination:
o The Company's annual financial statements and related footnotes.
o The independent accountant's audit of the financial statements and
report thereon.
o Any significant changes required in the independent accountant's audit
plan.
o Any changes in accounting principles.
o Any serious difficulties or disputes with management encountered
during the course of the audit.
o Other matters related to the conduct of the audit which are to be
communicated to the committee under generally accepted auditing
standards.
o Inquire as to whether the independent auditors are satisfied with the
disclosure and content of the financial statements to be presented to
the shareholders. Inquire as to auditor's view of the quality of the
Company's accounting principles employed, including any principles
employed which are deemed minority practices.
o Receive periodic reports from the independent auditor regarding the
auditor's independence and any disagreements with management on
financial, accounting or reporting matters, discuss such reports with
the auditor, and if so determined by the audit committee, recommend that
the board take appropriate action to satisfy itself of the independence
of the auditor or satisfactory resolution of any disagreements on
financial, accounting or reporting matters.
o Provide sufficient opportunity for the independent auditors to meet with
the members of the audit committee without members of management
present. Among the items to be discussed in these meetings are the
independent auditors' evaluation of the Company's financial and
accounting personnel, and the cooperation that the independent auditors
received during the course of the audit.
o Review with management and the independent accountant, the interim
financial report before it is filed with the SEC or other regulators.
o Review accounting and financial human resources and succession planning
within the Company.
o With respect to reporting and recommendations:
o prepare any report, including any recommendations of the audit
committee, required by the rules of the Securities and Exchange
Commission to be included in the Company's annual proxy statement;
o review this Charter at least annually, recommend any changes to the
full board of directors for approval and have the document published
as required by the rules of the Securities and Exchange Commission;
and
o report its activities to the full board of directors on a regular
basis and to make such recommendations with respect to the above and
other matters as the audit committee may deem necessary or
appropriate.
o Investigate any matter brought to its attention within the scope of its
duties, with the power to retain outside counsel for this purpose if, in
its judgment, that is appropriate.
o Inquire and review any consulting arrangements between the independent
auditor and management that are beyond the scope of the audit
assignment.
While the audit committee has the responsibilities and powers set forth
in this chapter, it is not the duty of the audit committee to plan or conduct
audits or to determine that the Company's financial statements are complete and
accurate and are in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent auditor. Nor is it
the duty of the audit committee to conduct investigations, to resolve
disagreements, if any, between management and the independent auditor, or to
assure compliance with laws and regulations and the Company's policy manuals.
<PAGE>
PROXY ATWOOD OCEANICS, INC.
ANNUAL MEETING OF SHAREHOLDERS
FEBRUARY 8, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints James M. Holland and Glen P. Kelley, or
either of them as Proxies, each with the power to appoint a substitute, and
hereby authorizes them to represent and to vote, as designated below, all the
shares of common stock, par value $1.00 per share, held of record by the
undersigned as of the close of business on December 29, 2000, at the Annual
Meeting of Shareholders to be held on February 8, 2001 or any adjournment
thereof:
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY IN THE ENVELOPE
PROVIDED
1. ELECTION OF DIRECTORS:
FOR all nominees listed WITHHOLD authority to vote for all nominees
listed
(except as marked to the contrary)
Nominees: Robert W. Burgess, George S. Dotson, Walter H. Helmerich, III,
Hans Helmerich, John R. Irwin, William J. Morrissey
(INSTRUCTION: To withhold authority to vote for one or more individual
nominees, write the nominee's name(s) in the line provided below.)
--------------------------------------------------------------------------------
2. Approval of Proposed amendment to the Company's 1996 Incentive Equity
Plan to include non-employee directors of the Company as eligible participants.
FOR AGAINST ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
--------------------------------------------------------------------------------
(see reverse side)
<PAGE>
This Proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made the Proxy will be voted
FOR the election of all Directors and FOR the proposed amendment to the
Company's 1996 Incentive Equity Plan.
Please sign exactly as name appears hereon.
________________________, 2001 _________________________________________
DATED SIGNATURE
-----------------------------------------
SIGNATURE IF JOINTLY HELD
NOTE: When shares are held by joint
tenants, both should sign. When signing as
attorney, as executor, administrator,
trustee, or guardian, please give full
title as such. If a corporation, please
sign in full corporate name by President
or other authorized officer. If a
partnership, please sign in partnership
name by authorized person. Please note any
change in your address alongside the
address as it appears in the proxy.
PLEASE MARK IN BLUE OR BLACK INK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
