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:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (section) 240.14a-11(c) or (section)
240.14a-12
POOL ENERGY SERVICES CO.
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(Name of Registrant as Specified in Its Charter)
POOL ENERGY SERVICES CO.
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(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No filing fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11.
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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PRELIMINARY COPY -- SUBJECT TO COMPLETION
DATED DECEMBER 9, 1998
[POOL ENERGY SERVICES CO. LETTERHEAD]
December __, 1998
Dear Shareholders:
We are writing to you about the continued takeover tactics by Nabors
Industries Inc. in its effort to buy Pool Energy Services Co at a bargain price.
Nabors has already started a creeping acquisition by purchasing over 10% of your
Company in the open market without paying any premium. Now Nabors is resorting
to another takeover tactic by calling a Special Meeting of shareholders of Pool.
At the Special Meeting, Nabors will propose that the shareholders adopt a
non-binding resolution recommending that Pool's Board arrange for the sale of
Pool and take all necessary actions to effect such sale, including, among other
things, entering into merger negotiations with Nabors and any other qualified
bidder offering a higher price per share than Nabors.
Nabors knows that even if the resolution passes, your Board of Directors is
not required to take any action whatsoever with respect to the sale of the
Company. Given this, your Board believes that Nabors has called the Special
Meeting as a tactic designed to disrupt the Company and distract it from
implementing its strategic plan.
For the reasons set forth in this Proxy Statement, your Board believes that
the Nabors resolution is not in the best interests of the Company or its
shareholders, particularly at this time with depressed prices for oilfield
service companies. The Board recommends that you reject the Nabors resolution by
voting AGAINST such proposal on the enclosed GOLD proxy card.
Your Board asks you to consider carefully the matters discussed in the
accompanying proxy materials and our letter dated November 27, 1998 in
evaluating the Nabors resolution.
To vote your proxy in opposition to the Nabors resolution, mark, sign, date
and return the enclosed GOLD proxy card as soon as possible. Please help us send
a strong message to Nabors to stop its disruptive takeover tactics. Your Board
unanimously believes Nabors is not acting in the best interests of all the Pool
shareholders. WE URGE YOU NOT TO SIGN ANY PROXY CARD YOU MAY RECEIVE FROM
NABORS.
We believe our Company's prospects are excellent and think that our
shareholders, not Nabors, should be the beneficiaries as our industry recovers.
It would not be prudent or responsible for our Board to let Nabors reap the
benefits that rightly belong to each of you. We appreciate your continued
support and interest in the affairs of the Company.
Sincerely,
[sig]
J.T. Jongebloed
Chairman, President
and Chief Executive Officer
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If you have any questions or need assistance in voting your GOLD proxy card,
please contact:
MACKENZIE
PARTNERS, INC.
156 Fifth Avenue
New York, New York 10010
CALL TOLL-FREE (800) 322-2885 OR (212) 929-5500 (COLLECT)
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PRELIMINARY COPY--SUBJECT TO COMPLETION, DATED DECEMBER 9, 1998
[LOGO OF POOL] POOL ENERGY SERVICES CO.
10375 RICHMOND AVENUE
HOUSTON, TEXAS 77042
SPECIAL MEETING
OF THE SHAREHOLDERS OF
POOL ENERGY SERVICES CO.
TO BE HELD ON JANUARY 12, 1999
PROXY STATEMENT BY THE BOARD OF DIRECTORS OF
POOL ENERGY SERVICES CO.
*****
YOUR VOTE IS IMPORTANT
PLEASE MARK, SIGN, DATE AND RETURN THE GOLD PROXY CARD
IN THE ENCLOSED POSTAGE-PAID ENVELOPE
*****
This proxy statement ("Proxy Statement") and the accompanying GOLD proxy
card are being furnished by the Board of Directors of Pool Energy Services Co.,
a Texas corporation ("Pool" or the "Company"), to the shareholders of the
Company in connection with a solicitation of proxies by the Board of Directors
to be used at the Special Meeting of Shareholders of the Company scheduled to be
held at the offices of the Company, 10375 Richmond Avenue, Houston, Texas 77042,
on January 12, 1999 at 9:30 a.m., Houston, Texas time, and at any and all
adjournments, postponements or reschedulings thereof (the "Special Meeting").
The Special Meeting was called by Nabors Industries, Inc., a Delaware
corporation ("Nabors"), and one of its subsidiaries. THIS PROXY STATEMENT IS IN
OPPOSITION TO THE SOLICITATION OF PROXIES BY NABORS.
At the Special Meeting, Nabors intends to introduce a non-binding
resolution (the "Nabors Resolution") requesting that the Company take all
necessary action to arrange for the sale of the Company, including entering into
good faith merger negotiations with Nabors and any other qualified bidder
offering a higher price per share than Nabors, redeeming the common stock
purchase rights of the Company, and taking all actions to approve the sale of
the Company under the Texas Business Corporation Act ("TBCA"), including without
limitation Article 13.03 of the TBCA. See "Reasons for Opposing the Nabors
Resolution."
FOR THE REASONS SET FORTH IN THIS PROXY STATEMENT, THE BOARD OF DIRECTORS
OF THE COMPANY (THE "BOARD") BELIEVES THAT THE NABORS RESOLUTION IS NOT IN THE
BEST INTERESTS OF THE COMPANY OR ITS SHAREHOLDERS. THE BOARD RECOMMENDS THAT YOU
REJECT THE NABORS RESOLUTION BY VOTING THE GOLD PROXY CARD AGAINST SUCH
PROPOSAL.
WE ASK THAT YOU NOT RETURN THE NABORS BLUE PROXY CARD. Even if you
previously signed and returned a blue proxy card sent to you by Nabors, you have
every right to change your vote. You may revoke your previous proxy at any time
before it is exercised (i) by executing a proxy bearing a later date; (ii) by
filing with the Secretary of the Company an instrument revoking it before the
day of the Special Meeting; or (iii) by attending the Special Meeting and voting
in person. Please complete, sign, date and mail the enclosed GOLD proxy card in
the postage-paid envelope provided. EVERY SHARE COUNTS AND YOUR PROMPT ATTENTION
IS IMPORTANT. PLEASE RETURN THE GOLD PROXY CARD TODAY.
This Proxy Statement and the GOLD proxy card are first being furnished to
shareholders of the Company on or about December__, 1998.
IF YOUR SHARES ARE HELD IN THE NAME OF A BROKER, BANK OR NOMINEE, ONLY THE
BROKER, BANK OR NOMINEE CAN SIGN A PROXY CARD AND ONLY UPON RECEIPT OF YOUR
SPECIFIC INSTRUCTIONS TO DO SO. PLEASE CONTACT THE PERSON RESPONSIBLE FOR YOUR
ACCOUNT AND INSTRUCT HIM OR HER TO VOTE THE GOLD PROXY CARD ON YOUR BEHALF.
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WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE READ AND
CAREFULLY CONSIDER THE INFORMATION PRESENTED IN THIS PROXY STATEMENT AND VOTE
AGAINST THE NABORS RESOLUTION BY COMPLETING, DATING AND SIGNING THE ACCOMPANYING
GOLD PROXY AND RETURNING IT PROMPTLY TO MACKENZIE PARTNERS, INC. IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
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If you have any questions or need assistance in voting your GOLD proxy card,
please contact:
MACKENZIE
PARTNERS, INC.
156 Fifth Avenue
New York, New York 10010
CALL TOLL-FREE (800) 322-2885 OR (212) 929-5500 (COLLECT)
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BACKGROUND
In late 1993, Nabors began acquiring shares of the common stock, no par
value per share, of the Company (the "Common Stock"). In September 1993, Eugene
M. Isenberg, Chairman and Chief Executive Officer of Nabors, and two other
directors of Nabors had dinner with James T. Jongebloed and Ernest J. Spillard,
both executive officers of the Company. Nabors' representatives expressed an
interest in pursuing joint purchasing or other arrangements that could be of
mutual benefit. No specific proposals were discussed and no specific further
actions resulted from that meeting.
In early 1994, the Company developed a strategic plan (the "Strategic
Plan") designed to further strengthen its competitive position and market share
in the oilfield services industry in order to achieve growth in revenues,
earnings and EBITDA (earnings (loss) before interest, income taxes, depreciation
and amortization, and minority interest). Key components of the plan included:
(i) pursuing expansion opportunities in existing core market areas through
acquisitions that result in consolidation cost savings; (ii) upgrading and
enhancing the capabilities of the Company's existing fleet and certain
specialized rig equipment to operate in markets with high levels of activity and
strong pricing fundamentals; (iii) entering new foreign markets that offer
significant development and production activity; and (iv) offering additional
services and equipment that complement the Company's businesses in its existing
locations. The Strategic Plan was adopted by the Board on May 5, 1994 when the
closing price of the Company's Common Stock was $7.25.
During April 1994, Mr. Isenberg telephoned Mr. Jongebloed to inquire
whether he had any interest in another dinner meeting to examine alternatives of
working together for the mutual benefit of each company's shareholders, but no
further discussions took place at that time. On May 26, 1994, Nabors reported
that it had acquired 867,500 shares of Common Stock (then constituting
approximately 6.4% of the outstanding shares). On June 8, 1994, the Company
announced that it had adopted its shareholder rights agreement. Later in the
summer of 1994, Mr. Isenberg and two other representatives of Nabors met with
Mr. Jongebloed and the Company's investment advisors to discuss whether the
Company had any interest in pursuing a merger, joint venture, or other
combination. Mr. Jongebloed indicated that the Company was of the opinion that
its shareholders would be better served by the implementation of the Strategic
Plan.
Since the adoption of the Strategic Plan, the Company has implemented a
number of key initiatives. These include acquiring additional well-servicing
operations, principally in California, West Texas, and the Rocky Mountains;
acquiring full ownership of the operation in Alaska in which Pool had previously
been a minority partner; increasing the Company's participation in foreign
markets; and acquiring a company that operates a fleet of offshore support
vessels in the Gulf of Mexico. The Company also enhanced its rig fleet through,
among other things, the construction of new rigs and the major upgrading of
others. During this period, the Company's revenues, EBITDA and earnings
increased substantially, and the Board believes that the market price of the
Common Stock reflected this improved financial performance, peaking at over
$40.00 per share on October 9, 1997.
Since October 1997, oil prices, which are the predominant driver of the
Company's business activity level, have declined more than 45%. Oil prices are
now at low levels not seen in over ten years. As a result, the Board believes
that the prices for the stocks of many oilfield services companies, including
the Company, are significantly depressed.
In the summer of 1998, after declining oil prices had begun to materially
affect the price of the Common Stock, Nabors approached an investment banker for
the Company regarding a possible combination of the Company and Nabors. Nabors
was told that the Company's management was not open to pursuing discussions at
that time, particularly in view of the then low market price for the Common
Stock.
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On October 12, 1998, Mr. Isenberg sent the following letter to the Board of
the Company (the "October 12th Letter"):
October 12, 1998
CONFIDENTIAL
The Board of Directors of
Pool Energy Services Co.
10375 Richmond Avenue
Houston, Texas 77042
Dear Mr. Jongebloed:
We recently raised with your outside advisor the potential benefits to our
respective stockholders, employees and customers of a combination of our two
companies. While you have informed us that you believe now is not an
appropriate time for a combination, we believe that the current environment
causes the combination to make eminent business sense for both companies.
The strategic direction of both Pool and Nabors is complementary. Each
company operates drilling and workover platform rigs in the Gulf of Mexico
and internationally as well as land drilling operations in Alaska and
internationally, including Saudi Arabia. A combination of the two companies
can lead to economies of scale that offer the prospect of significant
purchasing, operating and other efficiencies. Nabors' offshore presence
would also offer significant opportunities for marketing Pool's Sea Mar
Fleet.
In times of uncertainty, stockholders, employees and customers will
benefit from a larger, stronger and better-capitalized company. I think most
industry observers would also agree with this premise. For this reason, we
propose putting our two companies together and believe that such a
combination is in the best interest of the stockholders of both companies.
We would like to submit to your Board a merger proposal under which Nabors
would acquire all of the outstanding shares of Pool at a price of $12.50 per
share. This consideration would be payable at least 51% in stock (to
preserve tax free treatment) and the remainder in cash. This structure
offers those stockholders interested in retaining a long-term position the
prospect of participating in future upside prospects that are materially
enhanced as a result of the transaction and of growth with the benefit of an
over 50 percent premium. At the same time, stockholders electing cash will
recognize an immediate substantial premium over current market.
Your management team has clearly been a major contributor to the Company's
success. We believe that there will be continuing roles for key management
that will offer greater responsibilities and increased opportunities in the
context of a substantially larger company.
While we know your business well, our proposal is based on public
information. If you can demonstrate additional value, we would consider
offering a higher price.
Nabors' Board of Directors has unanimously approved our proposal. Our
financial advisors and bank lenders have assured us that financing is
available to meet all transaction requirements. Our legal advisors and we
have also carefully studied any potential antitrust issues raised by a
combination of our two companies, and we are confident that any necessary
approvals for the transaction can be obtained without any undue delay. Our
proposal is of course subject to negotiation of a definitive merger
agreement containing customary terms and conditions. We are prepared to
immediately commence negotiating a definitive acquisition agreement between
our companies and to consummate the agreement in an expeditious manner.
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My intent in sending this letter is to provide you with information about
our contemplated proposal and to express our desire to work together with
you to structure a transaction acceptable to your Board. We do not believe
this letter requires you to make any public disclosure and we do not intend
to make it public at this time. We would hope that at this point you would
be prepared immediately to commence discussions on a confidential basis
between us.
We would like to meet with you and your representatives to discuss our
proposal and to answer any questions that you may have. Please contact my
office (281-775-8077) to let me know when we can get together. We would
appreciate receiving your views as to our contemplated proposal no later
than October 23, 1998.
Sincerely,
/s/ Eugene M. Isenberg
Eugene M. Isenberg
Chairman and Chief Executive Officer
On October 12, 1998, Mr. Jongebloed shared the October 12th Letter with
other members of management, as well as with the Company's legal and financial
advisors. A meeting of the Board was held on October 19, 1998 to consider the
October 12th Letter. At that meeting, the Board, among other things, reviewed
the October 12th Letter, heard presentations as to fiduciary responsibilities of
the Board in considering acquisition proposals, such as the one set forth in the
October 12th Letter, and were advised as to the work that would need to be
performed by the Company's advisors to assist the Board in its consideration of
the proposal made by Nabors and the various alternatives available to the
Company.
At that time, the Board concluded that, given the values inherent in the
Company's business and the long-term strategies being implemented to improve
shareholder value, the Nabors proposal was not in the best interests of the
Company and its shareholders. In particular, the Board determined that the
Company's strategic initiatives as well as the long-term interests of the
Company and its shareholders would be best served by the continued independence
of the Company.
As a result, on October 26, 1998, Mr. Jongebloed sent the following letter
to Mr. Isenberg:
October 26, 1998
CONFIDENTIAL
Mr. Eugene M. Isenberg
Chairman and Chief Executive Officer
Nabors Industries, Inc.
515 West Greens Road, Suite 1200
Houston, Texas 77067-4525
Dear Mr. Isenberg:
My fellow directors and I have carefully considered your October 12, 1998
letter, and I have been instructed by our Board to tell you that we are not
interested in pursuing the discussions with your company suggested in that
letter. We want you to know that this decision is unanimous and unequivocal.
As you may know, our Company is committed to the implementation of its own
strategic plan, which is designed to capitalize on opportunities for the
Company and to increase shareholder values over the long term. We believe
the results of these efforts to date have been impressive. But for the
current unexpected downturn in our industry, which is the worst in many
years, we believe our stock price would better reflect the efforts and
achievements of our Board and management.
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We regard your letter as an expression of confidence in our Company, and
we are happy that you share our views concerning our Company's excellent
prospects.
You and your company have our best wishes.
Yours very truly,
/s/ J.T. Jongebloed
J.T. Jongebloed
On October 28, 1998, Nabors sent the following letter to the Company (the
"October 28th Letter"):
October 28, 1998
CONFIDENTIAL
The Board of Directors of
Pool Energy Services Co.
10375 Richmond Avenue
Houston, Texas 77042
Dear Mr. Jongebloed:
On October 12, 1998, I wrote to you proposing a combination of Nabors and
Pool in which Nabors would acquire all of the outstanding shares of Pool for
consideration consisting of 51% Nabors stock and 49% cash, with an implied
value at that date of $12.50 per Pool share. This offer represented a 77%
premium to Pool's closing stock price of $7.06 per share on October 9, 1998,
the last trading day prior to our proposal. On October 26, 1998, we received
a letter from you stating that Pool was not interested in pursuing
discussions with Nabors. In view of the superior value inherent in our
proposal, we were surprised that your Board of Directors could have
concluded unanimously and unequivocally not to discuss our proposal. Had our
proposal been accepted on October 12, your shareholders would have received
consideration with a blended value today of $14.72 based on the ratios
implied by our offer price of $12.50 and Nabors' closing price on October 9
of $13.25. We continue to believe that a business combination based on these
values is in the best interests of Pool and its shareholders.
In your letter, you refer to Pool's commitment to the implementation of
its own strategic plan, which is designed to increase shareholder value over
the long-term. We are convinced that this plan cannot outperform the
benefits of a combination of Pool and Nabors given the high fragmentation of
our industry, the economies of scale which will be realized through the
combination and the enhanced capital structure of the combined entities. As
a result, we believe that a combination of our companies will maximize the
long-term value to be realized by your shareholders.
Given the strong benefits of a combination of Pool and Nabors, we
encourage you to reevaluate our proposal to enter into a merger in which
Nabors would acquire all of the outstanding shares of Pool for consideration
equal to 0.481 Nabors shares and $6.125 in cash for each outstanding Pool
share. As stated above, this offer implies a value of $14.72 per Pool share
based on Nabors' closing stock price on October 27, 1998. In addition, as we
indicated in our letter of October 12, our proposal is based on public
information and, if you can demonstrate additional value, we would consider
offering a higher price.
We are hopeful that Pool's management and Board of Directors want to act
in the best interests of the company's shareholders. We also firmly believe
that your shareholders would welcome our proposal, and we are committed to
affording them the opportunity to do so. Based on the unusually high trading
volume in Pool's shares subsequent to our October 12 letter, it is in both
our interests to discuss this matter quickly. I will call you tomorrow to
discuss our proposal.
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Sincerely,
/s/ Eugene M. Isenberg
Eugene M. Isenberg
Chairman and Chief Executive Officer
Mr. Isenberg called Mr. Jongebloed on October 29, 1998, but Mr. Jongebloed
was unable to return the call that day. The next morning, October 30, 1998,
Nabors issued a press release setting forth, among other things, the text of
all prior correspondence and announcing the merger proposal.
On October 30, 1998, the Company sent the following letter to Nabors:
October 30, 1998
Mr. Eugene M. Isenberg
Chairman and Chief Executive Officer
Nabors Industries, Inc.
515 West Greens Road, Suite 1200
Houston, Texas 77067-4525
Dear Mr. Isenberg:
As I told you in my October 26 letter to you, our Board of Directors
carefully considered your October 12, 1998 letter and instructed me to tell
you that we are not interested in pursuing the discussions with your company
suggested in that letter. As I also said, this decision was unanimous and
unequivocal.
As you know, our Company is committed to the implementation of its own
strategic plan, which is designed to capitalize on opportunities for the
Company and to increase shareholder values over the long term. We believe
the results of these efforts to date have been impressive. But for the
current unexpected downturn in our industry, which is the worst in many
years, we believe our stock price would better reflect the efforts and
achievements of our Board and management.
It is not surprising that you share our views concerning our Company's
excellent prospects, but our shareholders -- not yours -- should be the
beneficiaries of our efforts as our industry recovers. It would not be
prudent or responsible for our Board to let others reap the benefits that
rightly belong to our shareholders.
Yours very truly,
/s/ J.T. Jongebloed
J.T. Jongebloed
Contrary to Nabors' assertions that management of Pool has refused to meet
with Nabors' representatives, representatives of Pool agreed to meet with Nabors
on or about November 13, 1998, to hear what Nabors had to say, on the assumption
that Nabors would agree to abandon its efforts to disqualify Pool's counsel on
what Pool perceived to be a trivial basis. Nabors refused to waive the
disqualification, and Pool was forced to engage new counsel.
On November 16, 1998, the Company engaged Morgan Stanley & Co. Incorporated
("Morgan Stanley") as its financial advisor to assist the Company in, among
other things, the evaluation and further implementation of its growth strategies
with the intent of maximizing long-term shareholder value.
On November 17, 1998, a representative of Morgan Stanley advised a
representative of Nabors' investment banker that Morgan Stanley and Pool's new
counsel needed time to familiarize themselves with the Company before
considering scheduling any meeting between representatives of Nabors and the
Company.
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On November 23, 1998, Nabors filed preliminary proxy materials relating to
its request for a Special Meeting to consider the Nabors Resolution. Also on
that date, Nabors, together with one of its subsidiaries, delivered to the
Company a notice calling for the Special Meeting and requested that the Company
provide, among other things, copies of the Company's stockholder lists, daily
transfer lists, names of non-objecting beneficial owners, and all minutes and
other records of meetings and proceedings of the Board and each committee
thereof. The Company intends to deliver to Nabors the requested documents to
which Nabors is entitled under applicable law.
On November 23, 1998, after Nabors' filing and a concurrent press release,
the Company issued a press release acknowledging receipt of Nabors' notice
calling for the Special Meeting. In that press release, Mr. Jongebloed expressed
his opinion of the calling of the Special Meeting in the context of Nabors'
specific acquisition proposal that the Board had previously rejected.
The text of that press release is as set forth below:
HOUSTON, November 23, 1998 -- Pool Energy Services Co. (NASDAQ:PESC)
today acknowledged receipt of a notice by Nabors Industries, Inc. (ASE:NBR)
calling for a Special Meeting of Shareholders of the Company in January 1999
"to consider and vote upon a non-binding resolution -- recommending the sale
of the Company." James Jongeloed, Chairman and Chief Executive Officer of the
Company, responded by saying. "This is another transparent attempt by Nabors
to pressure Pool's Board into approving a fire sale of the Company when the
oil industry is at a cyclical low and Pool is strongly positioned to optimize
value to shareholders as the industry recovers."
Pool said it is committed to the implementation of its own growth
strategies and the maximization of shareholder value. In this connection, the
Company announced that last week it had engaged Morgan Stanley Dean Witter to
assist it in the evaluation and further implementation of its growth
strategies with the intent of maximizing long term shareholder value.
Pool Energy Services Co., headquartered in Houston, is a diversified
energy services company principally engaged in providing well-servicing,
workover and drilling services and related transportation services on land
and offshore in the U.S. and selected international markets.
On December 2, 1998, the Board fixed December 9, 1998, as the record date
for shareholders entitled to vote at the Special Meeting and amended the
Company's Bylaws to eliminate the automatic reduction in the number of directors
upon the resignation, death or disability of a director. As a result of the
amendment, any vacancy created by a director's failure to complete his or her
term may be filled by a majority of the remaining directors by the appointment
of a successor to serve for the balance of the unexpired term of the predecessor
director.
The Board's position has been very clear for some time. On October 26,
1998, the Board unanimously and unequivocally communicated its decision to
Nabors that it was not interested in pursuing the discussions that Nabors had
suggested.
THE NABORS RESOLUTION
At the Special Meeting, Nabors has stated that it will propose that the
shareholders of the Company adopt the Nabors Resolution, which reads as follows:
RESOLVED, that the shareholders of Pool Energy Services Co. (the
"Company") strongly recommend that the Board of Directors of the Company
arrange for the sale of the Company and take all necessary actions to effect
such sale, including, without limitation, (i) entering into good faith merger
negotiations with Nabors Industries, Inc. ("Nabors") and any other qualified
bidder for the Company offering a higher price per share of Company common
stock than Nabors, (ii) redeeming the common stock purchase rights of the
Company granted pursuant to the Rights Agreement, dated as of June 7, 1994,
between the Company and the First National Bank of Boston and (iii) taking
all action to approve the sale of the Company
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under the Texas Business Corporation Act (the "TBCA"), including, without
limitation, Article 13.03 of the TBCA; it being understood that this
resolution is admonitory only and that the Board of Directors of the Company
must exercise its business judgment in fulfillment of its fiduciary duties to
the shareholders of the Company.
REASONS FOR OPPOSING THE NABORS RESOLUTION
The Board believes that the Nabors Resolution represents nothing more than
a takeover tactic in its attempt to acquire the Company in a trough of the
business cycle for oilfield service companies when the market price of the
Common Stock does not, in the opinion of the Board, appropriately reflect the
inherent value of the Company. Oil prices are at low levels not seen in over ten
years. Consequently, rig counts in the U.S. are also at cyclical lows. The
prices of many oilfield service companies, including the Company's Common Stock,
are therefore severely depressed. The Board believes that Nabors has chosen this
opportune time (from a buyer's perspective) to put pressure on the Board to sell
the Company.
Although Nabors' acquisition proposal does represent a premium over the
$11.813 closing price of the Common Stock on October 29, 1998 (the last trading
day immediately prior to Nabors' October 30, 1998 press release), the implied
value of Nabors' proposal as of that date is actually a discount of 48% from the
$27.750 closing price of the Common Stock on April 20, 1998 (which was the
highest closing price for the Common Stock thus far during 1998), less than
eight months ago. While between October 9, 1997 and October 9, 1998 (the last
trading day before Nabors' October 12th Letter) the closing price of the
Company's Common Stock fell 83% from $40.625 to $7.063, the closing price of
Nabors stock dropped 72% from $46.563 to $13.25.
The Board of Directors believes that takeover tactics like those employed
by Nabors in its letters to the Company, its press releases and its proxy
soliciting materials are inherently disruptive and force the Board and
management of the Company to spend time and resources in response to those
tactics which could be devoted more profitably for the shareholders of the
Company to the operation of the Company's business and the pursuit of the goals
of the Strategic Plan. Further, the Board believes that the Company will incur
substantial professional, printing, proxy solicitation and other direct costs in
responding to Nabors' proposals and the Nabors Resolution and in conducting the
Special Meeting at a time in the oil service industry when the Company's
resources should be used gainfully rather than on unnecessary expenses. The
Board also believes that adoption of the Nabors Resolution would encourage
Nabors to continue its tactics, which would result in continued distractions
from the Company's business objectives and an increase in related costs. Based
on the foregoing, the Board opposes the Nabors Resolution.
POOL'S GROWTH STRATEGIES TO MAXIMIZE SHAREHOLDER VALUE
The Company developed its Strategic Plan to further strengthen its
competitive position and market share in the oilfield services industry in order
to achieve growth in revenues, EBITDA, and earnings. Key components of the
Strategic Plan included:
o pursuing expansion opportunities in existing core market areas through
acquisitions that result in consolidation cost savings;
o upgrading and enhancing the capabilities of the Company's existing fleet
and certain specialized rig equipment to operate in markets with high
levels of activity and strong pricing fundamentals;
o entering new foreign markets that offer significant development and
production activity; and
o offering additional services and equipment that complement the Company's
businesses in its existing locations.
The Board believes that the Company has made significant progress in the
implementation of its growth strategies. Between June 1, 1994 and September 30,
1998, the Company:
o acquired additional land well-servicing operations principally in
California, West Texas and the Rocky Mountains, including 289 rigs, 128
oilfield trucks, 430 fluid storage tanks, six brine and disposal wells and
seven coiled tubing units, at an aggregate cost of $74 million;
9
<PAGE>
o acquired full ownership of the operations in Alaska in which the Company
had previously held a minority interest for $12 million;
o expanded and enhanced its rig fleet in Alaska, the Gulf of Mexico and
offshore California through constructing, upgrading and/or acquiring three
land drilling rigs, two platform drilling rigs, one jack-up workover rig
and one platform workover rig, at an aggregate cost of $73 million;
o increased the participation of the Company and its affiliates in foreign
markets, including Australia, Argentina, Malaysia and Saudi Arabia, through
various acquisitions and other investments, at an aggregate cost of $53
million; and
o acquired a company that operates a fleet of 23 offshore support vessels in
the Gulf of Mexico for $76 million in cash and 1.5 million shares of Common
Stock.
The Board believes that the following tables confirm that the Company's
growth strategies are working, as evidenced by the growth in Pool's revenues,
net income and EBITDA for each of the four years ended December 31, 1997 and for
the nine months ended September 30, 1997 and 1998:
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31 SEPTEMBER 30
---------------------------------------------------------- -------------------------
1994 1995 1996 1997 1997 1998
---------------- ----------- ----------- ----------- ----------- -----------
(IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C>
Revenues .................. $ 229.2 $ 277.3 $ 348.6 $ 451.9 $ 326.8 $ 360.9
Net Income (Loss) ......... ( 12.7)(a) 3.1 9.6 26.7 18.1 20.4
EBITDA(b) ................. ( 7.1)(a) 21.9 38.4 71.6 50.2 73.9
</TABLE>
<TABLE>
<CAPTION>
PERCENTAGE INCREASE FROM PERIOD TO PERIOD
----------------------------------------------------------------------
SEPTEMBER 30, 1997
TO
1994 -- 1995 1995 -- 1996 1996 -- 1997 SEPTEMBER 30, 1998
-------------- -------------- -------------- -------------------
<S> <C> <C> <C> <C>
Revenues .................. 21.0% 25.7% 29.7% 10.4%
Net Income (Loss) ......... NA 207.8 176.7 12.6
EBITDA(b) ................. NA 75.1 86.5 47.4
</TABLE>
- ----------
(a) Includes a $23.6 million pre tax ($15.3 million after tax) provision for
leasehold impairment.
(b) EBITDA means earnings (loss) before interest, income taxes, depreciation and
amortization and minority interest. The Company has included EBITDA data
because it is a measure commonly used in the oilfield service industry.
EBITDA is not a measure of financial performance determined under generally
accepted accounting principles, should not be considered as an alternative
to net income as a measure of performance or to cash flows as a measure of
liquidity, and is not necessarily comparable to similarly titled measures of
other companies.
Since the adoption of the Company's Strategic Plan on May 5, 1994, the
closing price of the Company's Common Stock rose from $7.25 to $40.625 on
October 9, 1997, an increase of approximately 460%. Subsequently, the decrease
in the price of oil began to adversely affect the trading prices of the Common
Stock as well as the stocks of other oilfield service companies.
On December 2, 1998, the Board considered the Nabors Resolution and the
previous correspondence from Nabors and consulted with the Company's management,
and its advisors. The Board then concluded that the interests of the Company's
shareholders are at present best served by the continued independence of the
Company and reaffirmed its commitment to enhancing shareholder value through
continued implementation of the growth strategies embodied in the Strategic
Plan. The Strategic Plan includes expansion of the Company through acquisitions
that result in consolidation cost savings and economies of scale. In view of
current levels of oil prices and conditions in the oil service industry
generally, the Board has requested that management of the Company and its
advisors continue to evaluate potential acquisitions, including acquisitions on
a larger scale than those that the Company has effected thus far under the
Strategic Plan to further enhance shareholder value.
10
<PAGE>
The Board, however, has been and will continue to be willing to evaluate any
alternative that it believes delivers to the Company's shareholder value
superior to that provided by the Company's own growth strategies.
THE SHAREHOLDER RIGHTS PLAN
As part of the Nabors Resolution, Nabors proposes that the shareholders
vote to advise the Board that it should redeem the common stock purchase rights
(the "Rights") granted pursuant to the Rights Agreement dated as of June 7,
1994, between the Company and the First National Bank of Boston (the "Rights
Plan"). The Board believes such a redemption would not be in the best interests
of the shareholders or the Company.
The Rights Plan was designed to provide the Board with negotiating leverage
in dealing with a potential acquiror, to protect the Company from unfair
takeover tactics, and to prevent an acquiror from gaining control of the Company
without offering a fair price to all shareholders and is not intended to prevent
a takeover on terms deemed beneficial to the Company's shareholders by the
Company's Board.
The Board believes that the Rights Plan was appropriately designed to
protect the shareholders from being forced to receive less than optimal value
for their shares of Common Stock. The Rights Plan was implemented to help
protect shareholders from acquisition proposals of the type being advanced by
Nabors. The Board therefore believes that redeeming the Rights Plan at present
is not in the best interests of the Company or its shareholders.
The Company's Board adopted the Rights Plan on June 7, 1994 and declared a
dividend of one Right for each outstanding share of the Company's Common Stock
to shareholders of record on June 23, 1994. The Rights will trade with the
Company's Common Stock until they become exercisable. The Rights will not be
exercisable until ten business days following a public announcement that a
person or group has acquired beneficial ownership 15% or more of the Company's
Common Stock or until ten business days after a person or group begins a tender
offer that would result in beneficial ownership of 15% of the Common Stock,
subject to certain extensions by the Board.
In the event that an acquiror becomes a 15% holder of the Company's Common
Stock, the Rights "flip in" and become rights to buy the Company's Common Stock
at a 50% discount, and Rights owned by that acquiror become void. In the event
that the Company is merged and its Common Stock is exchanged or converted, or if
50% or more of the Company's assets or earning power is sold or transferred, the
Rights "flip over" and entitle the holders to buy shares of the acquiror's
common stock at a 50% discount.
The Rights may be redeemed by the Company for $.01 per Right at any time
until ten business days following the first public announcement that an
acquiror has acquired the level of ownership that triggers the plan. The Rights
expire on June 6, 2004.
APPROVING THE SALE UNDER ARTICLE THIRTEEN OF THE TEXAS BUSINESS CORPORATION ACT
In the Nabors Resolution, Nabors also proposes that the shareholders vote
to advise the Board that it should take all actions to approve a sale of the
Company under the TBCA, including without limitation, Article 13.03 of the TBCA.
The Board believes that Article Thirteen of the TBCA provides the Company's
shareholders with important protections from takeover proposals that do not
result in the maximization of shareholder value. Consequently, the Board
believes that this portion of the Nabors Resolution is also not in the best
interests of the shareholders or the Company.
In the opinion of the Board, prior to 1997 the TBCA, as it applied to
public corporations, failed to address adequately the protection afforded to
shareholders of corporations domiciled in Delaware and many other jurisdictions.
Recognizing this, the Texas Legislature adopted Article Thirteen of the TBCA
which imposes a special voting requirement for the approval of certain business
combinations and related party transactions between public corporations and
affiliated shareholders. In general, the law provides, subject to certain
exceptions, for a three-year moratorium on mergers and share exchanges between
issuing public corporations like the Company and their affiliated shareholders
(i.e., persons who are, or
11
<PAGE>
within the last three years have been, the beneficial owner of more than 20% of
the corporation's then outstanding voting stock) and affiliates. More
particularly, such corporations are prohibited, directly or indirectly, from
entering into or engaging in a business combination with an affiliated
shareholder, or any affiliate or associate of the affiliated shareholder, during
the three-year period immediately following the date on which the shareholder
became an affiliated shareholder (the "share acquisition date") unless: (i) the
combination or the purchase or acquisition of shares is approved by the board of
directors of the corporation before the affiliated shareholder's share
acquisition date; or (ii) the combination is approved by the board of directors
and by the affirmative vote of the holders of at least two-thirds of the
outstanding voting shares of the corporation not beneficially owned by the
affiliated shareholder (or an affiliate or associate of the affiliated
shareholder), at a meeting of shareholders (and not by written consent) duly
called for that purpose not less than six months after the affiliated
shareholder's share acquisition date.
Article 13.06 also provides that in discharging their duties under the TBCA
or otherwise, the Company's directors, in considering the best interests of the
corporation, may consider the long-term as well as the short-term interests of
the corporation and its shareholders, including the possibility that those
interests may be best served by the continued independence of the corporation.
Article Thirteen ensures that the Board may consider long-term interests when
evaluating a takeover proposal. In addition, Article Thirteen does not preclude
the board of directors from taking other actions in accordance with law, nor
does the board of directors incur liability for elections made or not made under
Article Thirteen's provisions.
INDEPENDENT BOARD
Other than Mr. Jongebloed, who also serves as Chairman, President and Chief
Executive Officer of the Company, the Board believes that the directors of the
Company are outside, independent directors whose compensation as directors is
nominal in relation to both their responsibilities and to the valuable services
that they perform. To the extent the directors own, or have rights to acquire,
shares of Common Stock, the Board believes that they share a common economic
interest with the shareholders of Pool generally (other than Nabors and its
supporters). The Board further believes that all of Pool's outside directors are
both "independent" and "disinterested" as defined in the TBCA and that such
persons are seasoned executives who have proven track records and are committed
to maximizing values for all shareholders.
The Board has concluded that Nabors' proposal to acquire Pool on the terms
set forth in Nabors' published letters to the Board is not in the best interests
of all the Company's shareholders. The independent directors of the Company
believe that their recommendation against the Nabors' acquisition proposal
should be accorded more weight than Nabors' biased recommendation in support of
its proposal, as the Board is convinced that Nabors is primarily interested in
acquiring Pool at the lowest possible price.
CONSEQUENCES OF ADOPTION OF THE NABORS RESOLUTION
Since the Nabors Resolution is non-binding in nature, its adoption by the
shareholders of Pool will not obligate the Board to take any specific action in
response thereto. Furthermore, the Board believes that the Nabors Resolution
only serves to distract the Company's management from the pursuit of
opportunities under the Strategic Plan to maximize shareholder value. Therefore,
at the present time, the Board does not intend to take any specific action if
the Nabors Resolution is approved. The Board also believes that a vote for the
Nabors Resolution, unlike a vote on a definitive merger proposal approved by the
Board, has no effect on the nature of a shareholder's investment in the Company.
Additionally, if only a majority of the outstanding shares of Common Stock are
present and voting at the Special Meeting, the Nabors Resolution could be
approved by the affirmative vote of the holders of only 25% of the outstanding
shares of Common Stock plus one share. Nabors already owns approximately 42% of
the shares required to achieve approval of the Nabors Resolution under these
circumstances. In contrast, Nabors only owns approximately 17% of the minimum
number of shares required to approve a definitive merger agreement under Texas
law.
12
<PAGE>
CONCLUSION AND RECOMMENDATION
THE BOARD OF THE COMPANY RECOMMENDS A VOTE AGAINST THE NABORS RESOLUTION BY
MARKING, DATING, SIGNING AND RETURNING THE GOLD PROXY CARD.
THE SPECIAL MEETING
GENERAL
This Proxy Statement is furnished by the Board of the Company in opposition
to the solicitation of proxies by Nabors in connection with the Nabors
Resolution. Representatives of Nabors and one of its subsidiaries have scheduled
a Special Meeting of Shareholders of the Company to be held at the offices of
the Company, 10375 Richmond Avenue, Houston, Texas 77042 on January 12, 1999 at
9:30 a.m., local time.
PURPOSE
Nabors has stated that the purposes of the Special Meeting are to consider
and vote upon the Nabors Resolution and to transact such other business as may
properly come before the Special Meeting. The Board believes that under Texas
law and the Company's constituent corporate documents, only matters specifically
referred in the notice of a special meeting (other than routine administrative
matters) may be considered at the Special Meeting.
RECORD DATE; SHARES ENTITLED TO VOTE
Only holders of record of shares of Common Stock at the close of business
on December 9, 1998 (the "Record Date") are entitled to notice of and to vote at
the Special Meeting and at any adjournment, postponement or rescheduling
thereof. On the Record Date, there were _________ shares of Common Stock
outstanding. Such shares of Common Stock will each be entitled to one vote,
exercisable in person or represented by properly executed proxy, on any matter
properly before the Special Meeting.
QUORUM
The bylaws of the Company require the holders of a majority of the
outstanding shares of Common Stock to be present in person or represented by
properly executed proxy for any action to be taken at the Special Meeting, other
than an adjournment thereof. For purposes of determining whether this quorum
requirement is met, abstentions and broker non-votes received in connection with
properly signed and returned proxies will be counted as present.
REQUIRED VOTE
Assuming that a quorum is present at the Special Meeting, the affirmative
vote of the holders of a majority of the shares of Common Stock voting for or
against or expressly abstaining from voting on the Nabors Resolution is required
to approve that resolution. While broker-non votes will be counted as present at
the Special Meeting for quorum purposes, such votes will not be counted in
determining the total number of shares entitled to vote on the Nabors Resolution
at the Special Meeting, assuming a quorum is present. Under such circumstances,
broker non-votes will have the practical effect of reducing the number of
affirmative votes that Nabors must solicit in order to secure majority approval
of the Nabors Resolution at the Special Meeting. Abstentions will be considered
present at the Special Meeting for quorum purposes and will be counted for
purposes of determining the total number of shares entitled to vote on the
Nabors Resolution. Accordingly, abstentions will have the same effect as a vote
against the Nabors Resolution. Your broker, bank or nominee cannot vote your
shares without receipt of your specific instructions to do so. Please contact
the person responsible for your account and instruct him or her to vote the GOLD
proxy card on your behalf.
13
<PAGE>
RECOMMENDATION OF THE BOARD
WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, SHAREHOLDERS SHOULD
READ AND CAREFULLY CONSIDER THE INFORMATION PRESENTED IN THIS PROXY STATEMENT
AND ANY RELATED MATERIAL SENT TO YOU BY THE BOARD AND VOTE "AGAINST" THE NABORS
RESOLUTION BY COMPLETING, DATING AND SIGNING THE ACCOMPANYING GOLD PROXY CARD
AND RETURNING IT PROMPTLY TO MACKENZIE PARTNERS, INC. IN THE ENCLOSED
POSTAGE-PAID ENVELOPE OR INSTRUCTING YOUR BROKER TO EXECUTE THE GOLD PROXY CARD
ON YOUR BEHALF.
REVOCABILITY OF PROXIES
Unless you attend the Special Meeting and vote your shares in person, only
your latest dated properly executed proxy for the Special Meeting will count at
the Special Meeting. Any proxy given pursuant to the solicitation by either
Nabors or the Board also may be revoked by (i) filing with the Secretary of the
Company, before the taking of the vote at the Special Meeting, a written notice
of revocation bearing a later date than the date of the proxy or any later-dated
proxy relating to the same shares, or (ii) attending the Special Meeting and
voting your shares in person. Attendance at the Special Meeting will not in and
of itself constitute a revocation of a proxy. THE BOARD URGES YOU TO REVOKE ANY
BLUE PROXY CARD THAT YOU HAVE DELIVERED TO NABORS OR ITS AGENTS.
OTHER INFORMATION REGARDING PROXIES
All shares of Common Stock represented by properly executed proxies
received prior to or at the Special Meeting, and not duly and timely revoked,
will be voted in accordance with the instructions indicated on such proxies. If
no instructions are indicated on a properly executed returned GOLD proxy card,
such proxies will be voted AGAINST the Nabors Resolution. A properly executed
proxy marked "ABSTAIN," although counted for purposes of determining whether
there is a quorum for purposes of determining the aggregate voting power and the
number of shares represented at the Special Meeting, will not be voted.
The Board believes that the Nabors Resolution is the only substantive
matter that may be acted upon at the Special Meeting. If, however, other matters
are properly brought before the Special Meeting, including among other things, a
motion to adjourn the meeting to another time and/or place (including, without
limitation, for the purpose of soliciting additional proxies), the persons
appointed as proxies will have discretion to vote or act thereon according to
their judgment. If the Special Meeting is postponed or adjourned for any reason,
at any subsequent reconvening of the Special Meeting all proxies will be voted
on such matters in the same manner as such proxies would have been voted at the
original convening of the Special Meeting (except for any proxies that have
theretofore effectively been revoked or withdrawn), notwithstanding that such
proxies may have been effectively voted in the same or any other manner at a
previous meeting.
DISSENTERS' RIGHTS
Shareholders will not be entitled to dissenters' rights under the TBCA with
respect to the proposal to adopt the Nabors Resolution.
ADDITIONAL INFORMATION REGARDING POOL AND ITS DIRECTORS AND OFFICERS
POOL
The Company, headquartered in Houston, is a diversified energy services
company principally engaged in providing well-servicing, workover and drilling
services and related transportation services on land and offshore in the U.S.
and selected international markets.
As of September 30, 1998, the Company's worldwide rig fleet included 786
land well-servicing/workover rigs, 29 land drilling rigs and 27 offshore rigs
(14 platform workover rigs, 6 platform drilling rigs and 7 jack-up rigs). In the
United States, the Company operates in several oil and natural gas producing
states, with specific concentration onshore in Texas, California, Alaska,
Oklahoma,
14
<PAGE>
New Mexico and North Dakota, and offshore in the Gulf of Mexico. The Company
also owns or leases and operates 364 fluid hauling trucks, 1,149 fluid storage
tanks, 14 salt water disposal wells and other auxiliary equipment in its
domestic onshore operations and 23 offshore support vessels in the Gulf of
Mexico.
Internationally, the Company has a substantial presence in Saudi Arabia
where it is one of the largest providers of drilling and workover services and
has been providing such services for over 20 years. Other international markets
where the Company has an established presence include Argentina, Australia,
Ecuador, Guatemala, Malaysia, Oman and Pakistan.
The Company files annual, quarterly and current reports, proxy statements
and other information with the Securities and Exchange Commission
("Commission"). You may read and copy any reports or other reports, statements
or other information that the Company files at the Commission's public reference
rooms which are located at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the Commission's regional offices located at:
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661
and Seven World Trade Center, 13th Floor, New York, New York 10048.
Additionally, copies of such material can be obtained from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. Copies of such material may also be accessed through the
Commission's Internet web site at http://www.sec.gov. The Company's Common Stock
is listed on The Nasdaq Stock Market.
DIRECTORS
The following paragraphs set forth the name, age, and principal occupation
or employment during the past five years of each director of the Company, as
well as certain other directorships held by each such person and his period of
service as a director of the Company.
Mr. Dennis R. Hendrix, 58, has been a director of the Company since
September 1998. Mr. Hendrix served as Chief Executive Officer of PanEnergy Corp.
from 1990 to 1995 and served as its Chairman from 1990 until 1997, when the
company was merged with Duke Power to form Duke Energy Corporation. Mr. Hendrix
serves as a director of Allied Waste Industries, Inc., Duke Energy Corporation,
Newfield Exploration Company, Chase Bank of Texas and National Power, P.L.C. Mr.
Hendrix's term as a director will expire in the year 1999.
Mr. J.T. Jongebloed, 57, has served as a director since 1989 and currently
serves as a member of the Directors' Nominating Committee. Mr. Jongebloed has
served as Chairman since 1994 and President and Chief Executive Officer of the
Company since 1990. He served as President and Chief Operating Officer from 1989
to 1990 and in various executive positions with the Company since 1978. Mr.
Jongebloed's term as a director will expire in the year 2000.
Mr. John F. Lauletta, 53, has been a director of the Company since August
1998 and currently serves as a member of the Compensation Committee. Mr.
Lauletta has served as President and Chief Executive Officer of Tuboscope, Inc.
since 1996. Prior to that time, Mr. Lauletta served as President and Chief
Executive Officer of Drexel Oil Field Services, Inc. Mr. Lauletta's term as a
director will expire in the year 1999.
Dr. William H. Mobley, 57, has been a director of the Company since 1990
and currently serves as a member of the Audit/Finance Committee. Dr. Mobley is
President and Managing Director of PDI Global Research Consortia, Ltd., an
international management research and consulting firm. He was previously a
professor in the Graduate School of Business at Texas A&M University from 1980
to 1996. From 1993 to 1994 he was Chancellor of the Texas A&M University System,
and from 1988 to 1993 he was President of Texas A&M University. He is also a
director of Medici Medical Group, Inc. Dr. Mobley's term as a director will
expire in the year 2001.
Mr. Joseph R. Musolino, 61, has served as a director of the Company since
1994 and currently serves as Chairman of the Audit/Finance Committee. Mr.
Musolino has been Vice Chairman of NationsBank, N.A. for more than the last five
years. He also serves as a director of Justin Industries, Inc. Mr. Musolino's
term as a director will expire in the year 2001.
15
<PAGE>
Mr. James L. Payne, 61, has served as a director since 1992. Mr. Payne
serves as Chairman of both the Compensation Committee and the Directors'
Nominating Committee. Mr. Payne has been Chairman of the Board, Chief Executive
Officer and a director of Santa Fe Energy Resources, Inc. since 1990. He was
President of Santa Fe Energy Resources, Inc. from 1990 to 1998. Mr. Payne's term
as a director will expire in the year 2000.
EXECUTIVE OFFICERS
The following table sets forth the names, ages and offices held by the
executive officers of the Company as of the end of the Company's last fiscal
year and as of the date hereof:
<TABLE>
<CAPTION>
NAME AND AGE OFFICE
- -------------------------------- -------------------------------------------------
<S> <C>
James T. Jongebloed (57) Chairman, President and Chief Executive Officer
William J. Myers (62) Group Vice President -- U.S. Operations
Ronald G. Hale (49) Group Vice President -- International Operations
Ernest J. Spillard (59) Senior Vice President, Finance
Geoffrey Arms (55) Vice President and General Counsel; Corporate
Secretary
Louis E. Dupre (52) Vice President, Human Resources
</TABLE>
Each of the foregoing persons has been an executive officer or employee of the
Company for more than the last five years.
OTHER INFORMATION
Certain information concerning the identity of and beneficial ownership of
Common Stock by the directors and executive and other corporate officers of the
Company, the beneficial owners of more than 5% of the outstanding Common Stock,
and certain compensatory and other relationships between the Company and its
directors and certain of its executive officers is set forth on Annex A hereto.
Except as otherwise disclosed herein, to the best knowledge of the Company, no
such director or executive officer or associate of any such person has a
substantial interest in the matter to be acted upon at the Special Meeting.
SOLICITATION OF PROXIES
In addition to the use of the mail, facsimile, telephone, telegraph,
advertisements and in person communications, arrangements will be made with
banks, brokerage houses and other custodians, nominees and fiduciaries to
forward proxy materials to the beneficial owners of Common Stock, and the
Company will, upon request, reimburse them for their reasonable expenses. Proxy
solicitations may be made by directors and officers of the Company, none of whom
will receive additional compensation for such solicitation.
The Company has retained MacKenzie Partners, Inc. for solicitation and
advisory services in connection with this solicitation by the Board, and has
recently engaged Morgan Stanley as its financial advisor to assist the Company
with the review and further implementation of the Company's growth strategies
and to assist the Company in evaluating the unsolicited acquisition proposal by
Nabors.
The cost of soliciting proxies on behalf of the Board for use at the
Special Meeting is being borne by the Company. The Company estimates that the
total expenditures in connection with the solicitation (including the fees and
expenses of its attorneys, public relations advisors, investment advisors, and
proxy solicitors, and advertising, printing, mailing, travel and other costs,
but excluding salaries and wages of officers and employees) will be
approximately $ , of which approximately $ has been spent to date. The Company
has also agreed to indemnify some of its advisors from certain liabilities.
CERTAIN FORWARD LOOKING INFORMATION
Portions of this Proxy Statement include statements regarding future
financial performance and results of operations and other statements that are
not historical facts but are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
16
<PAGE>
Securities Exchange Act of 1934, as amended ("Exchange Act"). Statements to the
effect that the Company, the Board or management "anticipates," "believes,"
"estimates," "expects," "predicts," or "projects" a particular result or course
of events, or that such result or course of events "should" occur, and similar
expressions, are also intended to identify forward-looking statements. Such
statements are subject to numerous risks, uncertainties and assumptions,
including but not limited to uncertainties relating to industry and market
conditions, prices of crude oil and natural gas, foreign exchange and currency
fluctuations, political instability in foreign jurisdictions, the ability of the
Company to integrate newly acquired operations and other factors discussed in
this Proxy Statement and in the Company's other filings with the Commission.
Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially from
those stated.
SHAREHOLDER PROPOSALS
Pursuant to Rule 14a-8 of the Rules and Regulations promulgated under the
Exchange Act, shareholders may present proper proposals for inclusion in the
Company's Proxy Statement and for consideration at the next annual meeting of
its shareholders by submitting such proposals to the Company in a timely manner.
In order to be included for the 1999 annual meeting, shareholder proposals must
have been received by the Company no later than December 1, 1998, and must
otherwise have complied with all applicable legal requirements. Shareholder
proposals received after such time will be considered untimely and will not be
considered for inclusion in the Company's Proxy Statement at the 1999 annual
meeting of shareholders.
BY ORDER OF THE BOARD OF DIRECTORS OF
POOL ENERGY SERVICES CO.
17
<PAGE>
ANNEX A
OWNERSHIP OF COMMON STOCK
AND
OTHER INFORMATION
OWNERSHIP OF COMMON STOCK
The following table sets forth certain information regarding the beneficial
ownership of Common Stock. Except as otherwise noted, the information set forth
below concerning the beneficial ownership of Common Stock by (a) each director,
(b) each executive and other corporate officer and (c) each person known to the
Company to be the beneficial owner of more than 5% of the Company Common Stock
is as of October 31, 1998. A total of 21,043,898 shares of Common Stock was
outstanding as of October 31, 1998.
<TABLE>
<CAPTION>
NAME OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP
- -------------------------------------------------- -----------------------------------------
SHARES PERCENT OF TOTAL
--------------------- -----------------
<S> <C> <C>
Nabors Industries, Inc. .......................... 2,209,500(a) 10.5
Alton Anthony Gonsoulin, Jr. ..................... 2,000,000(b) 9.5
Brinson Holdings, Inc., Brinson Trust Company,
and Brinson Partners, Inc.,. .................... 1,104,455(c) 5.2
J.T. Jongebloed (e)(f) ........................... 181,110.203(h) (d)
William H. Mobley (e) ............................ 20,200(i) (d)
Joseph R. Musolino (e) ........................... 14,000(j) (d)
James L. Payne (e) ............................... 13,000(k) (d)
Dennis R. Hendrix (e) ............................ 10,000 (d)
John F. Lauletta (e) ............................. -0-
William J. Myers (f) ............................. 50,008.210(l) (d)
Ronald G. Hale (f) ............................... 22,333.337(m) (d)
Ernest J. Spillard (f) ........................... 99,394.681(n) (d)
Louis E. Dupre' (f) .............................. 12,251.087(o) (d)
Geoffrey Arms (f) ................................ 53,714.295(p) (d)
David C. Oatman (g) .............................. 2,662(q) (d)
Richard A. Johannsen (g) ......................... 11,874(r) (d)
Beth G. Gordon (g) ............................... 812(s) (d)
All directors and officers as a group (14 persons)
(e) (f) (g) ..................................... 491,359.813(t) 2.3
</TABLE>
- ----------
(a) Based upon an amended Schedule 13D filed on November 20, 1998; power
to dispose and vote shared with a wholly owned subsidiary.
(b) Based upon an amended Schedule 13D filed on September 18, 1998;
461,539 of such shars are owned by a wholly owned corporate
affiliate; 769,231 of such shares are held in escrow to fund
indemnity obligations to the Company through March 31, 2000, the
escrowed shares must be voted as directed by the Board through March
31, 2000 unless sooner converted into cash in accordance with the
terms of the escrow agreement.
(c) Based upon a Form 13F for the calendar quarter ended September 30,
1998. Brinson Holdings, Inc. ("BHI") is the parent company of
Brinson Partners, Inc. ("BPI,") which is a registered investment
adviser. BPI is the parent company of Brinson Trust Company ("BTC"),
a bank. All three companies are located at 209 South LaSalle,
Chicago, IL 60604-1295. The shares listed consist of 444,753 owned
by BTC and 659,702 owned by BPI. BTC has sole and shared voting
power with respect to 268,153 shares and 176,600 shares,
respectively, and BPI has sole, shared and no voting power with
respect to 487,502 shares, 36,200 and 136,000 shares, respectively,
BHI may be deemed to be the beneficial owner of all such shares
through its ownership of BPI and BTC.
(d) Less than 1%.
(e) Director with sole voting and dispositive power over all shares owned
or acquirable upon exercise of options as described in other
footnotes to this table.
A-1
<PAGE>
(f) Executive officer with sole voting and dispositive power over all
shares owned or acquirable upon exercise of options as described in
other footnotes to this table.
(g) Other corporate officer with sole voting and dispositive power over
all shares owned or acquirable upon exercise of options as described
in other footnotes to this table.
(h) Includes 166,723 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(i) Includes 16,000 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(j) Includes 10,000 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(k) Includes 8,000 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(l) Includes 22,437 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(m) Includes 12,505 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(n) Includes 90,457 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(o) Includes 9,668 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(p) Includes 45,804 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(q) Includes 2,562 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(r) Includes 3,937 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(s) Includes 812 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
(t) Includes 388,905 shares which may be acquired through the exercise of
stock options that are currently exercisable or will become
exercisable within 60 days after October 31, 1998.
OTHER INFORMATION
COMPENSATION OF DIRECTORS
Each director who is not an employee of the Company is currently
compensated by an annual cash retainer fee of $12,000 and an annual grant of
1,000 shares of Common Stock. The shares of Common Stock may not be sold or
transferred by the director for a period of one year after the grant and are
subject to forfeiture if the director resigns as director prior to completion of
the one year period. Such directors also receive a fee of $1,000 for each Board
or Board committee meeting attended. If more than one meeting is held on the
same day, however, full payment is made for only one meeting and the fee for
each additional meeting attended that day is $800. In addition, a $2,000 per
annum fee is paid for service on a Board committee, with an additional $1,500
per annum paid to the chairman of a Board committee. Directors who are employed
by the Company receive no additional compensation for service as members of the
Board or any committee of the Board.
Under the Company's 1996 Directors' Stock Incentive Plan (the "1996 Plan")
each director who is not a full-time employee of the Company automatically
receives an initial grant of an option to purchase 8,000 shares of Common Stock
upon being elected or appointed to the Board for the first time (the "Initial
Option Grant") and receives an additional option to purchase 4,000 shares of
Common Stock on the date of each Annual Meeting of Shareholders after the year
in which the Initial Option Grant occurred (the "Annual Option Grant"). The
exercise price of the options is equal to the fair market value per share of
Common Stock on the date an option is granted. Each option granted under the
1996 Plan
A-2
<PAGE>
becomes exercisable generally one year from the date of grant and expires ten
years after the date of the grant. If a participant's service as a director
terminates by reason of disability, death, the failure of the Board to nominate
him for reelection other than for "cause," as defined in the 1996 Plan, or his
ineligibility for reelection pursuant to the age limitation imposed by the
Company's Bylaws, his options may be exercised for up to one year after the date
of the disability, death or termination. If a director's service terminates
because he decides not to stand for reelection, or if he becomes a full-time
employee, his options may be exercised for up to three months after such event,
and, if his service terminates for any other reason, except for "cause," his
options may be exercised for up to five business days after such termination. In
the event a director's service terminates for "cause" his options will become
immediately null and void. Provision is made in the 1996 Plan for adjustments of
options in cases of mergers, stock splits and similar capital reorganizations
and for immediate vesting in the case of a change in control of the Company.
Directors of the Company in office prior to May 1996 also hold options
previously granted pursuant to the 1991 Directors' Stock Option Plan which has
terms and conditions similar to the terms and conditions of the 1996 Plan.
INDEMNITY ARRANGEMENTS
The Company's Bylaws obligate the Company to indemnify any person who is or
was a director, officer, employee or agent of the Company to the fullest extent
that a corporation may or is required to grant indemnification to a director
under the TBCA. The Company's Articles of Incorporation, as amended, further
provide that a director of the Company shall not be liable to the Company or its
shareholders for monetary damages for any act or omission in such director's
capacity as a director of the Company, in each case to the fullest extent
permitted by Texas law.
On October 19, 1998, the Board approved a form of indemnity agreement
pursuant to which the Company will contractually agree to indemnify directors
against liabilities arising from their serving as directors and to advance the
expenses of defending against such liabilities. This agreement, which is
designed to implement the indemnification provisions of Texas law to the maximum
practicable extent, sets forth, among other things, the standards of conduct
required to receive indemnification, the methods of securing approval for
indemnity payments and the procedural requirements necessary to secure the
advancement of expenses.
COMPENSATION OF EXECUTIVE OFFICERS
The Company's executive compensation is administered by the Compensation
Committee of the Board. The following report appeared in the Company's Proxy
Statement dated April 2, 1998, for its 1998 annual meeting of shareholders:
COMPENSATION COMMITTEE REPORT
ON
EXECUTIVE COMPENSATION
This report of the Compensation Committee ("Committee") sets forth the
Company's policy with respect to executive officer compensation and describes
the basis for 1997 compensation determinations made by the Committee with
respect to the Chief Executive Officer and other executive officers of the
Company.
COMPENSATION PHILOSOPHY
The Company's philosophy with regard to executive compensation is to:
o Provide a competitive total compensation package consistent with industry
practice that enables the Company to attract and retain key executives.
o Structure incentive compensation so as to focus executive attention and
effort on the fulfillment of the Company's financial objectives, and
on the appreciation of the value of the Company's stock.
A-3
<PAGE>
COMPENSATION PROGRAM ELEMENTS
The elements of the Company's compensation program for executive officers
are as follows:
BASE SALARY -- Base salary levels are largely determined through
comparisons with compensation paid to executives of companies of similar size
and complexity as the Company within the industry. The Committee attempts to
ensure that such pay levels are competitive within a range that the Committee
considers to be reasonable and necessary. The Committee utilizes for this
purpose surveys and the assistance of outside consultants as well as market
information from other sources and takes into consideration the Company's
performance both in absolute terms and in comparison with other companies in the
industry. With respect to the compensation of officers other than the Chief
Executive Officer, the Committee gives strong consideration to the
recommendations of the Chief Executive Officer which are based as to each such
executive officer largely on performance, longevity and responsibilities.
ANNUAL INCENTIVE COMPENSATION -- The Company's executive officers are
eligible to participate in management bonus plans established from time to time,
typically on an annual basis, which provide for bonus awards based on attaining
or exceeding specified financial and other performance objectives. Under the
bonus plan that was in effect for 1997, bonus awards were based on a net
earnings goal, an EBITD(1) goal and on return to shareholders in comparison with
a peer group of companies. For certain executives, a safety performance goal was
also added. Provision was made for awards under such plan to be increased, in
the event performance goals were exceeded by specified amounts, to a maximum of
twice the amount that would be awarded for attaining the targeted performance
objectives. Actual awards were subject to decreases or increases on the basis of
the Committee's evaluation of the Company's and/or the executive's performance,
although no such discretionary action was taken. The plan also provided that, at
the Committee's discretion, up to 50 percent of any bonuses payable for 1997
could be paid in Company stock, and the Committee directed that 25 percent of
the 1997 bonuses would be paid in shares of restricted stock (restricted for a
period of one year of continuing service after receipt, except for earlier
retirement, death, disability or change in control). The amounts paid in stock
were, under the terms of the plan, increased by 15 percent.
LONG TERM INCENTIVE COMPENSATION -- Executive officers also participated in
a long term incentive compensation plan. In 1997, award opportunities were
established for each executive officer under which awards will be made based on
performance over a three-year period. The awards, if earned, will be paid solely
in restricted stock (50 percent thereof restricted for one year and 50 percent
restricted for two years of continuing service after receipt, except for earlier
retirement, death, disability or change in control). Entitlement to receive
awards is based 50 percent on cumulative EBITD performance and 50 percent on
cumulative total return to shareholders performance compared to a peer group of
companies over the three-year period. Target awards are set at a percentage of
each recipient's annual salary in effect at the beginning of the performance
period. The target awards will be increased by up to 50 percent in the event
performance goals are exceeded by specified amounts.
STOCK INCENTIVE PLAN -- The Company has an Employee Stock Incentive Plan
(the "Stock Incentive Plan") pursuant to which executive officers and other
employees, from time to time, may be granted nonqualified options to purchase
Company Common Stock. The exercise price of all such stock options is the market
price of the shares on the date the option is granted, and the realization of
any value is, therefore, totally dependent on future stock price appreciation.
This is intended to provide added incentive to work for the continued growth and
success of the Company. The Stock Incentive Plan also permits the Committee to
make awards to executive officers and other employees, in lieu of cash
compensation, of (i) Restricted Stock (shares of Common Stock that are subject
to such vesting requirements or other restrictions as the Committee shall
establish), and (ii) Bonus Stock (shares of Common Stock that are not subject to
vesting or other restrictions).
SAR/PHANTOM STOCK PLAN -- The Company has a plan (the "SAR/Phantom Stock
Plan") pursuant to which executive officers and other employees, from time to
time, may be granted Stock Appreciation Rights and/or Phantom Stock awards. A
Stock Appreciation Right is the right to receive, upon the exercise thereof,
cash in an amount equal to the excess of the fair market value of a share of the
Company's Common Stock on the date of exercise over the base price of the Stock
Appreciation Right. A Phantom Stock award represents the right to receive cash
in an amount equal to the fair market value of a corresponding number of shares
of Common Stock, which vests over a period of time or upon the occurrence of an
event (including
A-4
<PAGE>
without limitation, a change in control) as established by the Committee,
without any payment to the Company by the participant (except to the extent
otherwise required by law). The SAR/Phantom Stock Plan is administered by the
Committee, and the Committee determines eligibility and grants all awards
thereunder.
- ----------
(1) EBITD is earnings before interest, income taxes, depreciation/amortization
and minority interest.
The SAR/Phantom Stock Plan was established effective January 1, 1997, and
no awards of Stock Appreciation Rights or Phantom Stock have yet been made
thereunder.
The Committee's overall objective in structuring incentive compensation for
executive officers and other key personnel is to deliver competitive levels of
compensation for the attainment by the Company of short-term and long-term
financial objectives that the Committee believes will favorably influence the
Company's stock price over time. The Committee further believes that
compensating employees who have substantial responsibility for the management
and growth of the Company with Company stock, and providing such persons with
opportunities to benefit directly from increases in the value of Company stock,
will also align their interests more closely with those of other shareholders
and provide additional incentive to enhance the profitable growth of the
Company.
1997 COMPENSATION
The base salary level approved by the Committee in 1997 for Mr. Jongebloed,
as Chairman, President and Chief Executive Officer, was established on the basis
of (i) personal performance, (ii) Company performance, and (iii) comparison with
salaries for chief executive officers of several well-recognized companies in
the same industry as the Company, as reported by an outside consultant, Hay
Management Consultants ("Hay"). Such base salary level amounted to a 9.5 percent
increase over his previous base salary which had been in effect for the previous
12 months. Mr. Jongebloed's bonus compensation for 1997 was calculated and paid
pursuant to the Company's 1997 Management Bonus Plan and was based on the
Company's attaining or exceeding goals based on (i) net income compared to
budget, (ii) EBITD performance compared to budget and (iii) return to
shareholders compared to that of a peer group of companies. The bonus earned was
the maximum bonus attainable under the Plan.
The Committee approved base salary levels in 1997 for other executive
officers based on recommendations by the Chief Executive Officer and Hay's
recommendations. Bonuses for 1997 were paid to executive officers pursuant to
the terms of the Company's 1997 Management Bonus Plan and were determined
totally on the Company's financial performance for the year. Each of the
executive officers received a bonus on the basis of the Company's attaining or
exceeding the net income, EBITD and return to shareholders goals mentioned
above. These bonuses were on average approximately 96 percent of the maximum
bonuses attainable under the Plan.
Stock option grants pursuant to the Stock Incentive Plan were made to Mr.
Jongebloed and other executive officers in 1997, as reflected in the Option
Grants Table, on the basis of Hay's recommendations, each executive's personal
performance and the desire to link Company performance to compensation.
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(M)
No formal policy has been adopted by the Company with respect to qualifying
compensation paid to its executive officers for an exemption from the limitation
on deductibility imposed by Section 162(m) of the Internal Revenue Code. The
Company anticipates that all compensation paid to its executive officers during
1997 will qualify for deductibility because no executive's compensation is
expected to exceed the dollar limitations of such provision.
COMPENSATION COMMITTEE
A-5
<PAGE>
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning the compensation paid
to the Chief Executive Officer and to each of the other four persons who were
the most highly compensated executive officers of the Company in 1997 for
services rendered in all capacities to the Company for the years ended December
31, 1997, 1996 and 1995:
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
--------------------------------------------- ------------------------
AWARDS
------------------------
SHARES
OTHER RESTRICTED UNDERLYING
ANNUAL STOCK STOCK ALL OTHER
SALARY BONUS(1) COMPENSATION(2) AWARDS OPTIONS COMPENSATION(1)(3)
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($)
- ----------------------------------- ------ --------- ---------- ----------------- ------------ ----------- -------------------
<S> <C> <C> <C> <C> <C> <C> <C>
J. T. Jongebloed .................. 1997 437,461 336,000 -- --0- 50,000 12,850
Chairman, President and .......... 1996 404,423 303,615 -- --0- 60,779 250
Chief Executive Officer .......... 1995 376,961 47,250 -- --0- 40,890 250
W. J Myers ........................ 1997 248,723 116,640 -- 190,875 19,000 4,624
Group Vice President -- .......... 1996 238,846 123,117 -- --0- 24,416 250
U.S. Operations .................. 1995 230,654 12,657 -- --0- 20,000 250
E. J. Spillard .................... 1997 207,154 120,000 -- --0- 16,000 4,750
Senior Vice President, ........... 1996 195,068 111,234 -- --0- 19,792 250
Finance .......................... 1995 185,937 16,875 -- --0- 20,000 250
R. G. Hale ........................ 1997 194,769 114,000 -- --0- 15,000 4,525
Group Vice President- ............ 1996 185,846 105,608 -- --0- 18,909 250
International Operations ......... 1995 177,653 29,563 -- --0- 20,000 250
G. G. Arms ........................ 1997 150,291 73,000 -- --0- 9,000 2,988
Vice President and ............... 1996 140,808 66,178 -- --0- 10,597 250
General Counsel; ................. 1995 133,392 12,188 -- --0- 15,000 250
Corporate Secretary
</TABLE>
- ----------
(1) Seventy-five percent of the bonus for 1997 was paid in cash and the
remainder in restricted shares of Common Stock, the number of which was
determined by dividing 25 percent of the bonus amount by the share price at
the award date and, in accordance with provisions of the bonus plan,
increasing that result by 15 percent. The value at the award date of the 15
percent increase is included in the amount shown in the "All Other
Compensation" column.
(2) Perquisites and other personal benefits paid in each year to each of the
named executive officers did not exceed the lesser of $50,000 or 10 percent
of such individual's total salary and bonus.
(3) Includes the amount contributed by the Company to each individual's 401(k)
Plan account in such year as well as, for 1997, the amount described in note
(1).
A-6
<PAGE>
OPTION EXERCISES AND YEAR-END VALUE TABLE
AGGREGATED OPTION EXERCISES IN 1997 AND YEAR-END OPTION VALUES
The following table sets forth information with respect to stock option
exercises during 1997, and unexercised stock options held, as of the end of
1997, by the persons named in the Summary Compensation Table:
<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT 12-31-97 OPTIONS AT 12-31-97
SHARES ACQUIRED VALUE (#) ($) -
ON EXERCISE REALIZED ------------------------------- ---------------------------
NAME (#) ($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------- ----------------- ----------- ------------- --------------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
J. T. Jongebloed ......... 69,110 1,407,818 118,889 121,780 1,646,391 1,374,391
W. J Myers ............... 23,604 295,742 2,500 49,812 31,563 570,252
E. J. Spillard ........... 25,000 415,625 72,676 43,344 977,393 500,219
R. G. Hale ............... 14,720 188,110 7 41,682 88 483,111
G. G. Arms ............... 25,000 502,500 34,404 26,448 458,567 310,282
</TABLE>
- ----------
(1) Value realized is the excess of the current market value at the date of
exercise minus the exercise price.
OPTION GRANT TABLE
OPTION GRANTS IN 1997
The following table sets forth information with respect to stock options
granted during 1997 to the persons named in the Summary Compensation Table:
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
% OF TOTAL ANNUAL RATES OF STOCK PRICE
NUMBER OF OPTIONS APPRECIATION
SHARES UNDERLYING GRANTED TO EXERCISE FOR OPTION TERM(5)
OPTIONS GRANTED EMPLOYEES IN PRICE EXPIRATION -----------------------------------
NAME (1)(2)(3) 1997 ($/SH)(4) DATE 5% 10%
- ----------------------------- ------------------- -------------- ----------- ----------- ----------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
J. T. Jongebloed ............ 50,000 29.21% 13.50 5/1/07 $ 424,500 $ 1,075,800
W. J Myers .................. 19,000 11.10% 13.50 5/1/07 161,310 408,804
E. J. Spillard .............. 16,000 9.35% 13.50 5/1/07 135,840 344,256
R. G. Hale .................. 15,000 8.76% 13.50 5/1/07 127,350 322,740
G. G. Arms .................. 9,000 5.26% 13.50 5/1/07 76,410 193,644
Total ...................... 109,000 63.67% $ 925,410 $ 2,345,244
All Shareholders(6) ......... N/A N/A N/A N/A $ 165,121,552 $ 418,463,522
Named Executives' Gain as
% of all Shareholders'
Gain ....................... N/A N/A N/A N/A 0.56% 0.56%
</TABLE>
- ----------
(1) All options granted in 1997 become exercisable in equal annual increments of
33 1/3 percent commencing on the first anniversary of the award. Vesting may
be accelerated, however, in the event of a change in control of the Company.
(2) The Compensation Committee and/or the Board retains discretion, subject to
plan limits, to modify the terms of outstanding options.
(3) The options have a term of ten years, but are subject to earlier expiration
in certain events related to termination of employment.
(4) The exercise price and any related tax withholding obligations arising in
connection with exercise may be satisfied by the optionholder's surrender of
already-owned shares or by offsetting a portion of the shares issuable upon
exercise, subject to certain limitations.
(5) The dollar amounts shown in these columns are the result of computation
required by the Commission's regulations, and are not intended to forecast
future appreciation, if any, of the Stock price of the Common Stock.
(6) Potential shareholder gain is included for comparison purposes and is
calculated assuming all outstanding shares were purchased at a price equal
to the market price of the Common Stock ($13.50 per share) on May 1, 1997,
the date of the 1997 option grants.
A-7
<PAGE>
1998 OPTION GRANTS
On February 17, 1998, the Compensation Committee of the Board granted
ten-year options to purchase shares of Common Stock at an exercise price of
$18.34375 per share to Messrs. J. T. Jongebloed, W. J. Myers, E. J. Spillard,
R. G. Hale and G . G. Arms in the amounts of 40,000 shares, 16,000 shares,
14,000 shares, 13,000 shares and 8,000 shares, respectively. These options vest
in equal annual increments on February 17, 1999, 2000 and 2001. On July 9,
1998, the Compensation Committee of the Board granted additional ten-year
options to purchase shares of Common Stock at an exercise price of $12.50 per
share to Messrs. J. T. Jongebloed, E. J. Spillard, R. G. Hale and G. G. Arms in
the amounts of 110,000 shares, 35,000 shares, 25,000 shares, and 15,000 shares,
respectively. These options vest in equal annual increments on July 9, 1999,
2000, 2001 and 2002.
LONG-TERM INCENTIVE PLANS
1996 AWARDS. The following table sets forth information with respect to the
potential awards of Common Stock under the Company's 1996 Long-Term Incentive
Plan ("1996 Plan") to the persons named in the Summary Compensation Table. The
receipt of the shares indicated will depend on the Company's performance
compared to specified goals during the performance compared to specified goals
during the performance period commencing January 1, 1996 and ending December 31,
1998.
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYMENT
---------------------------------
NUMBER OF PERFORMANCE THRESHOLD TARGET MAXIMUM
NAME SHARES PERIOD (#) (#) (#)
- -------------------------- ----------- ------------- ----------- -------- --------
<S> <C> <C> <C> <C> <C>
J. T. Jongebloed ......... 24,632 3 years 12,316 24,632 36,947
W. J. Myers .............. 9,895 3 years 4,948 9,895 14,842
E. J. Spillard ........... 8,021 3 years 4,011 8,021 12,032
R. G. Hale ............... 7,663 3 years 3,832 7,663 11,495
G. G. Arms ............... 3,579 3 years 1,790 3,579 5,368
</TABLE>
1997 AWARDS. The following table sets forth information with respect to the
potential awards of Common Stock under the Company's 1997 Long-Term Incentive
Plan ("1997 Plan") to the persons named in the Summary Compensation Table. The
receipt of the shares indicated will depend on the Company's performance
compared to specified goals during the performance period commencing January 1,
1997 and ending December 31, 1999.
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUT
---------------------------------
NUMBER OF PERFORMANCE THRESHOLD TARGET MAXIMUM
NAME SHARES PERIOD (#) (#) (#)
- -------------------------- ----------- ------------ ----------- -------- --------
<S> <C> <C> <C> <C> <C>
J. T. Jongebloed ......... 17,155 3 years 4,289 17,155 25,733
W. J Myers ............... 6,617 3 years 1,654 6,617 9,926
E. J. Spillard ........... 5,446 3 years 1,362 5,446 8,169
R. G. Hale ............... 5,174 3 years 1,294 5,174 7,761
G. G. Arms ............... 2,485 3 years 621 2,485 3,728
</TABLE>
1998 AWARDS The following table sets forth information with respect to the
potential awards of Common Stock under the Company's 1998 Long-Term Incentive
Plan ("1998 Plan") to the persons named in the Summary Compensation Table. The
receipt of the shares indicated will depend on the Company's performance
compared to specified goals during the performance period commencing January 1,
1998 and ending December 31, 2000.
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUT
---------------------------------
NUMBER OF PERFORMANCE THRESHOLD TARGET MAXIMUM
NAME SHARES PERIOD (#) (#) (#)
- -------------------------- ----------- ------------ ----------- -------- --------
<S> <C> <C> <C> <C> <C>
J. T. Jongebloed ......... 11,389 3 years 2,847 11,389 17,084
W. J Myers ............... 4,209 3 years 1,052 4,209 6,313
E. J. Spillard ........... 3,549 3 years 887 3,549 5,323
R. G. Hale ............... 3,301 3 years 825 3,301 4,952
G. G. Arms ............... 2,398 3 years 400 1,599 2,398
</TABLE>
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<PAGE>
1999 AWARDS. The Compensation Committee has recommended and the Board has
approved the Company's 1999 Long-Term Incentive Plan ("1999 Plan") covering the
performance period commencing on January 1, 1999 and ending December 31, 2001.
The number of shares potentially issuable to Messrs. J.T. Jongebloed, E.J.
Spillard, R.G. Hale and G.G. Arms will be determined with reference to the
average closing price of the Common Stock over the last twenty trading days of
1998.
OTHER TERMS. Under the 1996 Plan, the 1997 Plan, the 1998 Plan and the 1999
Plan (collectively, the Long-Term Plans"), a target award of shares was or will
be established for each participant based on a percentage of the individual's
salary in effect at the beginning of the applicable three-year performance
period. A payout under each of the Plans will depend on the extent to which the
established performance criteria are satisfied. Target awards under the 1996
Plan, the 1997 Plan and the 1998 Plan are based 50 percent on earnings before
interest, taxes and depreciation performance and 50 percent on total return to
shareholders as compared to a peer group of companies. Target awards under the
1999 Plan will be based 25 percent on earnings before interest, taxes and
depreciation performance, 25 percent on total return to shareholders as compared
to a peer group of companies, 25 percent on Common Stock performance compared to
the Standard & Poor's 500 Index and 25 percent on price appreciation of the
Common Stock.
All awards under the Long-Term Plans are to be paid in Common Stock, to the
extent sufficient shares are available under the Company's 1993 Employee Stock
Incentive Plan, and otherwise are to be paid in cash. Shares received under the
Long-Term Plans will be restricted so that, (i) if the executive's employment
terminates within one year after the shares are earned, 100 percent of the
shares would be forfeited, and (ii) if the executive's employment terminates
between one and two years after the award is earned, 50 percent of the shares
would be forfeited except in the event of termination of the executive's
employment due to retirement, death, total disability, redundancy or change in
control. Target payouts are equal to specified percentages of participants'
annual base salaries in effect at the beginning of the performance period, as
follows: 60 percent for Mr. Jongebloed, 40 percent for Messrs. Myers, Spillard
and Hale, and 25 percent for Mr. Arms. Threshold payouts under the 1996 Plan are
one-half of target payouts, and threshold payouts under the other Long-Term
Plans are one-fourth of the target payouts. Maximum payouts under each of the
Long-Term Plans are 150 percent of the target payouts. Threshold payouts are
made if performance falls within a certain range below that which is necessary
to earn the target award. Maximum payments are made if performance exceeds by a
specified amount that which is necessary to earn the target payouts.
RETIRMENT BENEFITS AND CHANGE IN CONTROL ARRANGEMENTS
RETIREMENT PLAN. The Company has a defined benefit retirement plan for its
employees with different benefit formulas for salaried and hourly employees (the
"Qualified Retirement Plan"). In connection with the upgrading of the Company's
401(k) qualified defined contribution plan (the "Savings Plan"), effective as of
January 1, 1999, the Qualified Retirement Plan was amended in 1998 to preclude
the entry of new participants after January 1, 1998 and to terminate the accrual
of any further benefits after December 31, 1998. The normal monthly retirement
benefit payable at age 65, or later if employment continues beyond age 65, for
salaried employees is equal to 1 percent of the monthly average of the
participant's highest rate of base compensation determined as of each January 1
of any five consecutive years during the ten consecutive years preceding
December 31, 1998, plus 0.6 percent of the excess of compensation as so
determined over the monthly average of the maximum taxable wage base used to
calculate old-age benefits under the Federal Social Security Act for the 35
years ending with the year in which the participant will attain his normal
retirement age under the Federal Social Security Act, multiplied by years and
fractions thereof of credited service from May 1, 1990, to December 31, 1998.
The Qualified Retirement Plan provides for actuarially reduced benefits for
early retirement. Although the normal form of benefit for married participants
is a joint and 50 percent survivor annuity and, for unmarried participants, a
life only annuity, the Qualified Retirement Plan permits other forms of benefit
payment. At December 31, 1997, credited service under the plan for Messrs.
Jongebloed, Myers, Spillard, Hale and Arms was 7.67 years each, and the highest
average annual compensation recognized by the plan for each of them was
$152,000, $152,000, $152,000, $152,000, and $132,800, respectively.
A-9
<PAGE>
SAVINGS PLAN. The Savings Plan has been enhanced significantly effective
January 1, 1999. As of that date, employees may contribute up to 20% of their
annual compensation to the Savings Plan on a tax-deferred basis, and the Company
will match 100 percent of the first 3 percent, and 50 percent of the next 2
percent, of compensation contributed by each employee. The Company will
contribute an additional 3.5 percent of compensation for certain employees of
its Alaska operation. All Company contributions to the Savings Plan will be made
in shares of Common Stock. In addition to Common Stock, participants may direct
the investment of their savings into one or more of five funds with varying
degrees of investment risk and opportunity. As of January 1, 1999, participants
will be 100 percent vested in the Company's contributions to the Savings Plan.
The table below illustrates the amount of annual pension benefit payable
under the plan on a straight life annuity basis beginning at age 65 to a person
in a specified average salary and years of service classification using, for all
years, the 1996 maximum taxable wage base used to calculate old-age benefits
under the Federal Social Security Act:*
<TABLE>
<CAPTION>
YEARS OF SERVICE
-------------------------------------------------------------------
REMUNERATION 15 20 25 30 35
- ------------------ ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
$100,000 ......... $ 18,114 $ 24,152 $ 30,190 $ 36,228 $ 42,266
125,000 ......... 24,114 32,152 40,190 48,228 56,266
150,000 ......... 30,114 40,152 50,190 60,228 70,266
175,000 ......... 32,514 43,352 54,190 65,028 75,866
200,000 ......... 32,514 43,352 54,190 65,028 75,866
225,000 ......... 32,514 43,352 54,190 65,028 75,866
250,000 ......... 32,514 43,352 54,190 65,028 75,866
300,000 ......... 32,514 43,352 54,190 65,028 75,866
400,000 ......... 32,514 43,352 54,190 65,028 75,866
500,000 ......... 32,514 43,352 54,190 65,028 75,866
</TABLE>
- ----------
* In accordance with the applicable provisions of the Internal Revenue Code of
1986, as amended, annual compensation above $160,000 is disregarded in
calculating benefits, and the benefits payable under the Qualified Retirement
Plan are limited to $125,000 annually. Both limits are subject to adjustment
by the Secretary of the Treasury to reflect cost-of-living increases and are
included in the above table.
SUPPLEMENTARY EXECUTIVE RETIREMENT PLANS. The Company has two nonqualified
supplementary executive retirement plans which provide retirement benefits for
certain senior executives, one of which plans was implemented in 1993 and the
other in 1996. The 1993 plan provides benefits equal to 2 percent of the average
of the participant's salary and annual bonus compensation for each of the five
years for which such compensation was highest out of the last ten consecutive
years of employment, multiplied by years of credited service of employment with
the Company, Pool Company and ENSERCH Corporation, up to 35 years, minus (i)
social security benefits and (ii) retirement benefits payable to the participant
pursuant to, or resulting from his participation in, any other qualified defined
benefit plans of the Company, Pool Company or ENSERCH Corporation, including the
Qualified Retirement Plan. The 1996 plan provides benefits equal to 2 1/2
percent of the average of the participant's salary and annual bonus compensation
for each of the five years for which such compensation was highest out of the
last ten consecutive years of employment, multiplied by years of credited
service of employment with the Company, Pool Company and ENSERCH Corporation, up
to 24 years, minus (i) retirement benefits payable to the participant pursuant
to, or resulting from his participation in, any other qualified defined benefit
plans of the Company, Pool Company or ENSERCH Corporation, including the
Qualified Retirement Plan, and (ii) benefits payable pursuant to the 1993 plan.
The benefit thus determined is payable in an actuarial equivalent lump sum
amount. Messrs. Jongebloed, Myers, Spillard, Hale and Arms are eligible for
benefits under such plans. At December 31, 1997, credited service under these
plans for Messrs. Jongebloed, Myers, Spillard, Hale and Arms was 19.3, 9.9,
18.0, 26.1 and 22.2 years, respectively, and the highest average annual
compensation recognized by the plans for each of them was $570,617, $303,472,
$255,501, $246,852 and $179,449, respectively.
A-10
<PAGE>
The table below illustrates the amount of annual pension benefit that would
be payable under the supplementary plans on a straight life annuity basis
beginning at age 65 to a person in a specified average salary and years of
service classification using for all years the maximum Social Security primary
insurance amounts for a worker retired at age 65 in 1996 and estimated
retirement benefits payable under the Company's current qualified defined
benefit retirement plan:*
<TABLE>
<CAPTION>
YEARS OF SERVICE
---------------------------------------------------------------
REMUNERATION 15 20 25 30 35
- ------------------ ---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C>
$100,000 ......... $ 0 $ 0 $ 3,706 $ 7,668 $ 11,630
125,000 ......... 0 1,744 6,206 10,668 15,130
150,000 ......... 0 3,744 8,706 13,668 18,630
175,000 ......... 3,882 10,544 17,206 23,868 30,530
200,000 ......... 11,382 20,544 29,706 38,868 48,030
225,000 ......... 18,882 30,544 42,206 53,868 65,530
250,000 ......... 26,382 40,544 54,706 68,868 83,030
300,000 ......... 41,382 60,544 79,706 98,868 118,030
400,000 ......... 71,382 100,544 129,706 158,868 188,030
500,000 ......... 101,382 140,544 179,706 218,868 258,030
600,000 ......... 131,382 180,544 229,706 278,868 328,030
700,000 ......... 161,382 220,544 279,706 338,868 398,030
</TABLE>
- ----------
* The annual benefits shown in the table have been reduced by the amount of any
retirement benefits payable pursuant to other qualified defined benefit plans
of the Company and other required offset items, but does not reflect the
offset which will be made for any benefits payable under any applicable
ENSERCH Corporation retirement plan (see text above).
POOL COMPANY RETIREMENT PLAN. Prior to the Company's acquisition of Pool
Company, Pool Company had a defined benefit retirement plan (which was merged
into the ENSERCH Corporation Retirement and Death Benefit Program) that provided
for a fixed benefit for salaried employees upon retirement at age 65.
Participants who were employees of the Company ceased to accrue further benefits
thereunder on the completion of the Company's acquisition of Pool Company.
Payments under this plan are offsets under the supplemental executive retirement
plans discussed above. Pursuant to the terms of such plan, Messrs. Jongebloed,
Myers, and Spillard are entitled to annuity payments of $19,635, $3,299, and
$12,226, respectively, per annum for life commencing upon normal retirement at
age 65. Messrs. Hale and Arms were not participants in such plan.
CHANGE IN CONTROL AGREEMENTS. Messrs. Jongebloed, Myers, Spillard, Hale and
Arms each has entered into amended and restated change in control agreements
with the Company that set forth certain benefits that the Company will provide
to such officers in the event of a "change in control" or a "potential change in
control" of the Company, as defined in the agreements. Such agreements continue
in effect until terminated by the Company upon specified notice and continue for
three years following a change in control of the Company and for the duration of
any potential change in control. The agreements each provide that if a change in
control occurs, the officer shall be entitled to receive an amount equal to the
"target award" provided for in each of the Long Term Plans that is then in
effect in which the officer participates. Such payment is to be made in shares
of Common Stock to the extent the Long Term Plan provides for payment in stock
and to the extent shares are available for such purpose, and otherwise such
amount is to be paid in cash. The agreements also provide that all stock options
of the officer will become fully vested upon a change in control, and provide
that if the officer's employment is terminated by the Company or if the officer
elects to terminate employment under certain circumstances defined as "good
reason" within three years following a change in control of the Company, or if
the officer's employment is terminated while there exists a potential change in
control and a change in control thereafter occurs within a certain period of
time, the officer will be entitled to a lump sum severance payment. Such
severance payment is to be equal to (i) three times the officer's annual base
salary (but not in excess of the aggregate base salary that could be earned up
to the officer's normal retirement date), (ii) an amount equal to three times
the bonus award for achieving the target performance goals provided for in the
Company's management bonus plan for the year preceding that
A-11
<PAGE>
in which the change in control occurs, and (iii) at the officer's election, the
value over the exercise price of unexercised stock options. In addition, the
officer shall be entitled to a three-year continuation of certain employee
benefits, two additional years of service credit under the Company's retirement
program, and reimbursement of certain legal fees, expenses, and any applicable
excise taxes. The Company has entered into similar agreements with twelve other
persons.
IMPORTANT
Your vote is important, no matter how many or how few shares of Common
Stock you may own. We urge you to vote AGAINST the adoption of the Nabors
Resolution by:
1. MARKING the enclosed GOLD proxy card,
2. SIGNING the enclosed GOLD proxy card,
3. DATING the enclosed GOLD proxy card, and
4. MAILING the enclosed GOLD proxy card TODAY in the envelope provided (no
postage is required if mailing in the United States).
IF ANY SHARES OF COMMON STOCK ARE HELD FOR YOUR ACCOUNT IN THE NAME OF A
BROKERAGE FIRM, BANK, BANK NOMINEE OR OTHER INSTITUTION, ONLY SUCH INSTITUTION
CAN VOTE YOUR SHARES AND ONLY UPON RECEIPT OF YOUR SPECIFIC INSTRUCTIONS.
ACCORDINGLY, PLEASE CONTACT THE PERSON RESPONSIBLE FOR YOUR ACCOUNT AND INSTRUCT
THAT PERSON TO EXECUTE THE GOLD PROXY CARDS REPRESENTING YOUR SHARES. YOUR BOARD
ASKS YOU TO CONFIRM IN WRITING YOUR INSTRUCTIONS TO MACKENZIE PARTNERS, INC. AT
THE ADDRESS PROVIDED BELOW SO THAT YOUR BOARD WILL BE AWARE OF ALL INSTRUCTIONS
GIVEN AND CAN ATTEMPT TO ENSURE THAT SUCH INSTRUCTIONS ARE FOLLOWED.
If you have any questions or need assistance in voting your GOLD proxy card,
please contact:
MACKENZIE
PARTNERS, INC.
156 Fifth Avenue
New York, New York 10010
CALL TOLL-FREE (800) 322-2885 OR (212) 929-5500 (COLLECT)
A-12
<PAGE>
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PRELIMINARY COPY -- SUBJECT TO COMPLETION
DATED DECEMBER 9, 1998
[FORM OF PROXY CARD -- GOLD]
POOL ENERGY SERVICES CO.
SPECIAL MEETING OF SHAREHOLDERS
*******
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
IN OPPOSITION TO PROXIES SOLICITED BY NABORS INDUSTRIES, INC.
*******
The undersigned hereby constitutes, appoints and authorizes J.T. Jongebloed
and James L. Payne, and each of them severally, as the true and lawful
attorneys, agents and proxies of the undersigned, with full power of
substitution and resubstitution, to represent and to vote all shares of common
stock, no par value, of Pool Energy Services Co. (the "Company") held of record
by the undersigned on December 9, 1998 at the Special Meeting of Shareholders to
be held at the offices of the Company, located at 10375 Richmond Avenue,
Houston, Texas 77042, at 9:30 a.m., local time, on January 12, 1999, and at any
adjournment(s), postponement(s) or rescheduling(s) thereof, in accordance with
the instructions noted below, and with discretionary authority with respect to
such other matters, not known or determined at the time of solicitation of this
Proxy, as may properly come before said meeting or any adjournment(s),
postponement(s) or rescheduling(s) thereof. Receipt of the Proxy Statement dated
December __, 1998 from the Board of Directors ("Proxy Statement"), is hereby
acknowledged.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS AND WILL BE VOTED IN
ACCORDANCE WITH THE SHAREHOLDER'S SPECIFICATION HEREON. IN THE ABSENCE OF SUCH
SPECIFICATION, THE PROXY WILL BE VOTED "AGAINST" THE PROPOSAL SET OUT BELOW.
================================================================================
1. To consider and vote upon the Nabors Resolution set forth in the Proxy
Statement. A VOTE "AGAINST" THE NABORS RESOLUTION IS RECOMMENDED.
[ ] AGAINST [ ] FOR [ ] ABSTAIN
2. In their discretion, the aforementioned attorneys and proxies are
authorized to vote upon such other matters as may properly come before the
Special Meeting or any adjournment(s), postponement(s) or rescheduling(s).
DATED: , 199
------------- ---
----------------------------
Signature of Shareholder
----------------------------
Title or Authority
----------------------------
Signature of Shareholder (if
held jointly)
*Please sign as name appears.
Joint owners each should
sign. When signing as
attorney, trustee,
administrator, executor,
etc., please indicate your
full title as such. If signor
is a corporation, please give
full corporate name by duly
authorized officer. If a
partnership, please sign in
partnership name by
authorized person.
PLEASE DATE, SIGN AND MAIL YOUR PROXY PROMPTLY.
PLEASE DO NOT FOLD THIS PROXY.
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