<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
MARINE DRILLING COMPANIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
JOAN R. SMITH/WILLIAM H. FLORES
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / 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:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transactions applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:(1)
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
/ / 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:
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- --------------------------------------------------------------------------------
(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
- --------------------------------------------------------------------------------
- ---------------
(1) Set forth the amount on which the filing fee is calculated and state how
it was determined.
<PAGE> 2
{LOGO}
MARINE DRILLING COMPANIES, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 4, 1994
To the Stockholders:
Notice is hereby given that the annual meeting of stockholders of
Marine Drilling Companies, Inc. (``the Company'') will be held in the One Sugar
Creek Place Auditorium on the first floor of the Company's headquarters located
at 14141 Southwest Freeway, Sugar Land, Texas on Wednesday, May 4, 1994 at 9:00
a.m. for the following purposes:
1. To elect six (6) directors.
2. To ratify the Board of Directors' appointment of KPMG Peat
Marwick, independent public accountants, as auditors for the
year ending December 31, 1994.
3. To transact such other business as may properly be brought
before the meeting or any adjournment(s) thereof.
Stockholders of record of the Company's Common Stock at the close of
business on March 24, 1994 will be entitled to notice of and to vote at the
meeting or any adjournment(s) thereof. A list of such stockholders will be
available at the time and place of the meeting and at the Company's offices,
14141 Southwest Freeway, Suite 2500, Sugar Land, Texas 77478-3435, during the
ten days preceding the meeting.
By Order of the Board of Directors,
Joan R. Smith
Secretary
Sugar Land, Texas
April 1, 1994
IT IS IMPORTANT THAT YOUR SHARES ARE REPRESENTED AT THE MEETING, WHETHER
OR NOT YOU ARE ABLE TO ATTEND PERSONALLY. ACCORDINGLY, YOU ARE REQUESTED TO
SIGN, DATE AND MAIL PROMPTLY THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED.
<PAGE> 3
- --------------------------------------------------------------------------------
PROXY STATEMENT
SOLICITATION AND REVOCABILITY OF PROXIES
This proxy statement is being furnished to the stockholders of Marine
Drilling Companies, Inc. (the ``Company'') in connection with the solicitation
of proxies by the Company's Board of Directors for use at the Annual Meeting of
Stockholders to be held in the One Sugar Creek Place Auditorium on the first
floor of the Company's headquarters located at 14141 Southwest Freeway, Sugar
Land, Texas on Wednesday, May 4, 1994 at 9:00 a.m. CDT and any adjournment
thereof. The approximate date on which this proxy statement and the form of
proxy are first being sent or given to stockholders of the Company is April 4,
1994.
At the Annual Meeting, the holders of shares of common stock, par value
$.01 per share, of the Company (the ``Common Stock'') will be asked to consider
and vote upon (i) the election of six persons to serve on the Board of
Directors of the Company, (ii) ratification of the Board of Directors'
appointment of KPMG Peat Marwick as independent auditors for the Company for
fiscal year 1994 and (iii) to consider and take action upon such other matters
as may properly come before the Annual Meeting.
All shares of Common Stock represented at the Annual Meeting by
properly executed proxies received prior to or at the Annual Meeting, and not
revoked, will be voted at the Annual Meeting in accordance with the
instructions indicated on such proxies. If no instructions are indicated with
respect to any shares for which properly executed proxies have been received
and which are eligible to vote, such proxies will be voted FOR the Board of
Directors' nominees for directors and FOR ratification of the Board of
Directors' appointment of KPMG Peat Marwick as independent auditors for fiscal
year 1994. If any other matters are properly presented at the Annual Meeting
for action, the persons named in the proxies and acting thereunder will have
discretion to vote on such matters in accordance with their best judgment as to
the best interests of the Company. The Board of Directors of the Company does
not know of any other matters to be brought before the Annual Meeting.
Any proxy given pursuant to this solicitation may be revoked by the
person giving it at any time before it is voted. Proxies may be revoked by any
of the following actions: (i) filing with the Secretary of the Company, at or
before the Annual Meeting, but in any event prior to the vote on the matter as
to which revocation is sought, a written notice of revocation bearing a later
date than the proxy; (ii) duly executing and submitting a subsequent proxy
relating to the Annual Meeting; or (iii) voting in person at the Annual Meeting
(although attendance at the Annual Meeting will not, in and of itself,
constitute a revocation of a proxy). Any written notice revoking a proxy
should be sent to the Secretary of the Company at the Company's principal
executive offices, 14141 Southwest Freeway, Suite 2500, Sugar Land, Texas
77478-3435.
The close of business on March 24, 1994 was the date fixed by the Board
of Directors for the determination of stockholders of record entitled to notice
of and to vote at the Annual Meeting and any adjournment thereof. On March 24,
1994, the Company had issued and outstanding 43,792,876 shares of Common Stock,
constituting the only class of stock outstanding. The holders of a majority of
the outstanding shares of Common Stock as of March 24, 1994, present in person
or represented by proxy and eligible to vote, will constitute a quorum at the
Annual Meeting. A list of such stockholders will be available at the time and
place of the meeting and at the Company's offices, 14141 Southwest Freeway,
Suite 2500, Sugar Land, Texas 77478-3435, during the ten days preceding the
meeting.
- -------------------------------------------------------------------------------
1
<PAGE> 4
- -------------------------------------------------------------------------------
Each share of Common Stock is entitled to one vote at the Annual
Meeting with respect to each matter to be voted upon. The persons named in the
accompanying proxy will vote for the nominees named herein unless specifically
instructed to the contrary.
The Company's Annual Report for the year ended December 31, 1993, which
includes, among other things, the Company's audited consolidated balance sheets
at December 31, 1993 and 1992, respectively, and audited consolidated
statements of income and changes in financial position for each of the years
ended December 31, 1993, 1992 and 1991, respectively, will be mailed to
stockholders on or about April 4, 1994. Additional copies are available from
the Company upon request.
The cost of this solicitation will be borne by the Company. It is
expected that the solicitation of proxies will be primarily by mail, telephone
and telegraph. The Company has arranged for Morrow & Co., Inc., 909 Third
Avenue, 20th Floor, New York, New York 10022-4799 to solicit proxies in such
manner at a cost of $2,000, plus out-of-pocket expenses. Proxies may also be
solicited personally by directors, officers, and other regular employees of the
Company in the ordinary course of business and at nominal cost. Proxy
materials will be provided for distribution through brokers, custodians, and
other nominees or fiduciaries to beneficial holders of the Common Stock. The
Company expects to reimburse such parties for their reasonable out-of-pocket
expenses incurred in connection therewith.
- -------------------------------------------------------------------------------
2
<PAGE> 5
- -------------------------------------------------------------------------------
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information with respect to the shares
of Common Stock (the only class of securities of the Company) owned of record
and beneficially as of March 24, 1994, by (i) all persons who own of record or
are known by the Company to own beneficially more than 5% of the outstanding
shares of such class of stock, (ii) each current director of the Company, (iii)
each nominee for election as a director of the Company, (iv) each named
executive officer of the Company and (v) all directors and executive officers
of the Company as a group:
<TABLE>
<CAPTION>
COMMON STOCK
---------------------------------
NUMBER PERCENTAGE
OF OF COMMON
STOCKHOLDER SHARES STOCK OWNED
- ----------- -------------- -----------
<S> <C> <C>
Warburg, Pincus Capital Company, L.P. (1) . . . . . . . . . 11,091,120 25.3%
466 Lexington Avenue
New York, NY 10017
Aeneas Venture Corporation (2) . . . . . . . . . . . . . . 5,328,430 12.2%
600 Atlantic Avenue
Boston, MA 02210
FMR Corp. (3) . . . . . . . . . . . . . . . . . . . . . . . 4,591,500 10.5%
82 Devonshire Street
Boston, MA 02109
The Chase Manhattan Bank, N.A. . . . . . . . . . . . . . . 3,123,985 7.1%
One Chase Manhattan Plaza
New York, NY 10081
Capricorn Investors, L.P. (4) . . . . . . . . . . . . . . . 2,537,726 5.8%
72 Cummings Point Road
Stamford, CT 06902
William O. Keyes (5) . . . . . . . . . . . . . . . . . . . 1,629,576 3.7%
William H. Flores (6) . . . . . . . . . . . . . . . . . . . 104,188 *
Howard H. Newman (7) . . . . . . . . . . . . . . . . . . . 11,091,120 25.3%
James E. Thomas (8) . . . . . . . . . . . . . . . . . . . . 11,091,120 25.3%
Christopher M. Linneman (9) . . . . . . . . . . . . . . . . -- --
Michael E. McMahon (10) . . . . . . . . . . . . . . . . . . 5,328,430 12.2%
Michael R. Eisenson (11) . . . . . . . . . . . . . . . . . 5,328,430 12.2%
Herbert S. Winokur, Jr. (12) . . . . . . . . . . . . . . . 2,537,726 5.8%
Gerald T. Greak (13) . . . . . . . . . . . . . . . . . . . 55,210 *
Hugh L. Adkins (14) . . . . . . . . . . . . . . . . . . . . 39,424 *
Joan R. Smith (15) . . . . . . . . . . . . . . . . . . . . 22,984 *
All executive officers and directors
as a group (11 persons) (16) . . . . . . . . . . . . . . . 20,808,658 47.4%
</TABLE>
- -------------
* Less than one percent (1%) of the outstanding shares.
(see notes on following page)
- -------------------------------------------------------------------------------
3
<PAGE> 6
- -------------------------------------------------------------------------------
Footnotes:
(1) The sole general partner of Warburg, Pincus Capital Company, L.P.
(``Warburg'') is Warburg, Pincus & Co., a New York general partnership
(``WP''). E.M. Warburg, Pincus & Co., Inc. (``EMW''), through a
wholly-owned subsidiary, manages Warburg. WP owns all of the
outstanding stock of EMW and, as the sole general partner of Warburg,
has a 20% interest in the profits of Warburg. EMW owns .9% of the
limited partnership interests in Warburg. Howard H. Newman and James
E. Thomas are Managing Directors of EMW and general partners of WP. As
such, Mr. Newman and Mr. Thomas, who are directors of the Company, may
be deemed to have an indirect pecuniary interest in an indeterminate
portion of the shares beneficially owned by Warburg, EMW and WP. See
Notes (7) and (8) below. Lionel I. Pincus is the managing partner of
WP and may be deemed to control it.
(2) Aeneas Venture Corporation (``Aeneas'') is a wholly-owned subsidiary of
the President and Fellows of Harvard College, a Massachusetts
educational corporation, that assists in the management of the Harvard
University endowment fund. Mr. Eisenson is the President of Aeneas
Group, Inc., an affiliate of Aeneas, and a vice president and director
of Aeneas. Mr. Eisenson participates in the investment decisions of
Aeneas, but has neither sole voting nor sole investment power over such
shares. Mr. Eisenson disclaims beneficial ownership of the shares
owned by Aeneas. In addition, Mr. McMahon is a partner of Aeneas
Group, Inc. and also participates in the investment decisions of
Aeneas. Mr. McMahon has neither sole voting nor sole investment power
over such shares, and disclaims beneficial ownership of the shares
owned by Aeneas.
(3) Based on a Schedule 13G filed by FMR Corp. on March 10, 1994. Such
Schedule 13G indicates that Fidelity Management & Research Company, a
wholly-owned subsidiary of FMR Corp., is the beneficial owner of
3,779,400 shares as a result of acting as advisor to several investment
companies and that Fidelity Management Trust Company, a wholly-owned
subsidiary of FMR Corp., is the beneficial owner of 812,100 shares as a
result of its serving as investment manager of institutional accounts.
Edward C. Johnson 3rd, Chairman of FMR Corp., owns 34% of the
outstanding common stock of FMR Corp.
(4) The general partner of Capricorn Investors, L.P. (``Capricorn'') is
Capricorn Holdings, G.P., the general partner of which is Winokur
Holdings, Inc. Mr. Winokur is the President and sole shareholder of
Winokur Holdings, Inc. Mr. Winokur, a director of the Company, may be
deemed to have an indirect pecuniary interest in an indeterminate
portion of the shares owned by Capricorn.
(5) Mr. Keyes is Chairman of the Board, Chief Executive Officer, President
and Director. Mr. Keyes holds options to purchase 300,000 shares of
Common Stock under the Company's 1992 Long Term Incentive Plan, and as
of March 24, 1994, no shares were exercisable within sixty (60) days.
(6) Mr. Flores is a Director, Senior Vice President and Chief Financial
Officer. Mr. Flores holds options to purchase 300,000 shares of Common
Stock under the Company's 1992 Long Term Incentive Plan, and as of
March 24, 1994, no shares were exercisable within sixty (60) days.
(7) Mr. Newman is a Director. All of the shares indicated as owned by Mr.
Newman are owned directly by Warburg and are included because of Mr.
Newman's affiliation with Warburg. Mr. Newman disclaims ``beneficial
ownership'' of these shares within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934. See Note (1) above.
(8) Mr. Thomas is a Director. All of the shares indicated as owned by Mr.
Thomas are owned directly by Warburg and are included because of Mr.
Thomas' affiliation with Warburg. Mr. Thomas disclaims ``beneficial
ownership'' of these shares within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934. See Note (1) above.
(9) Mr. Linneman, a Vice President of EMW, is a nominee for Director of the
Company.
(10) Mr. McMahon is a nominee for Director of the Company. All of the
shares indicated as owned by Mr. McMahon are owned directly by Aeneas
and are included because of Mr. McMahon's affiliation with Aeneas and
Aeneas Group. Mr. McMahon disclaims ``beneficial ownership'' of these
shares within the meaning of Rule 13d-3 under the Securities Exchange
Act of 1934. See Note (2) above.
(11) Mr. Eisenson is a Director. All shares indicated as beneficially owned
by Mr. Eisenson are owned directly by Aeneas and are included because
of Mr. Eisenson's affiliation with Aeneas and Aeneas Group. See Note
(2) above. Mr. Eisenson disclaims beneficial ownership of the shares
owned by Aeneas.
(12) Mr. Winokur is a Director. All shares indicated as beneficially owned
by Mr. Winokur are owned directly by Capricorn and are included because
of Mr. Winokur's affiliation with Capricorn. See Note (4) above.
(13) Mr. Greak is Senior Vice President--Marketing. Mr. Greak holds options
to purchase 276,800 shares of Common Stock under the Company's 1992
Long Term Incentive Plan, and as of March 24, 1994, 51,800 shares were
exercisable within sixty (60) days which are included in such amount.
(14) Mr. Adkins is Senior Vice President and Operations Manager. Mr. Adkins
holds options to purchase 225,520 shares of Common Stock under the
Company's 1992 Long Term Incentive Plan, and as of March 24, 1994,
38,020 shares were exercisable within sixty (60) days which are
included in such amount.
(15) Ms. Smith is Vice President, Controller and Secretary. Ms. Smith holds
options to purchase 96,250 shares of Common Stock under the Company's
1992 Long Term Incentive Plan, and as of March 24, 1994, no shares were
exercisable within sixty (60) days.
(16) Included are the shares owned by Warburg, Aeneas and Capricorn with
which Messrs. Newman, Thomas, Eisenson and Winokur are associated and
89,820 option shares exercisable within sixty (60) days of the date of
March 24, 1994.
- -------------------------------------------------------------------------------
4
<PAGE> 7
- -------------------------------------------------------------------------------
ITEM 1 - ELECTION OF DIRECTORS
At the time of the 1994 Annual Meeting of Stockholders, the Company's
Board of Directors will consist of six directors who will each serve until the
next Annual Meeting of Stockholders or until the election and qualification of
their respective successors.
It is intended that the proxies received from holders of the Company's
Common Stock, in the absence of contrary instructions, will be voted at the
1994 Annual Meeting for the election of the nominees for director whose names
are set forth below. Although the Company does not contemplate that any of the
nominees will be unable to serve, decline to serve, or otherwise be unavailable
as a nominee at the time of the Annual Meeting, in such event the proxies will
be voted in accordance with the authority granted in the proxies for such other
candidate or candidates as may be nominated by the Board of Directors.
If, for any reason, at the time of the election, one or more of such
nominees elected by the Board of Directors should be unable to serve or for
good cause will not serve, the proxy may be voted for a substitute nominee or
nominees selected by the Board of Directors. Each of the nominees named below
has consented to being named in this proxy statement and to serve if elected.
The affirmative vote of the holders of a majority of the shares of
Common Stock represented in person or by proxy and entitled to vote at the
Annual Meeting is required for the election of directors. Under Texas law, an
abstention would have the same legal effect as a vote against a director, but a
broker non-vote would not be counted for purposes of determining whether a
majority had been achieved. Shareholders may not cumulate their votes in the
election of directors.
Pursuant to the Shareholders' Agreement discussed below, Warburg has
nominated for election as directors Howard H. Newman and Christopher M.
Linneman and has agreed to vote for such nominees.
SHAREHOLDERS' AGREEMENT
On October 29, 1992, the Company, Warburg, Aeneas, Capricorn, William
O. Keyes (``Mr. Keyes'') and The Chase Manhattan Bank (National Association)
(``Chase'') entered into a shareholders' agreement (the ``Shareholders'
Agreement'') with respect to the shares (the ``Investor Shares'') of Common
Stock received by each of them in connection with the Company's 1992
reorganization (the ``Reorganization''). The Shareholders' Agreement provided
that, in any election of the Company's directors, each of Warburg, Chase,
Aeneas, Capricorn and Mr. Keyes had the right to designate one nominee so long
as the Investor Shares then owned by such shareholder equaled or exceeded 5% of
the outstanding Common Stock. In addition, Warburg shall have the right to
designate an additional nominee (for a total of two) so long as the Investor
Shares then owned by it equals or exceeds 15% of the outstanding Common Stock.
As a result of the Shareholders' Agreement, Warburg, Aeneas, Capricorn, Chase
and Mr. Keyes had until June 29, 1993, among other things, the ability to elect
all the directors of the Company.
On June 29, 1993, the Shareholders' Agreement was terminated except
with respect to Warburg's right to designate one or two nominees, as described
above.
- -------------------------------------------------------------------------------
5
<PAGE> 8
- -------------------------------------------------------------------------------
NOMINEES FOR DIRECTOR
The following table sets forth certain information for each nominee
listed in the enclosed proxy for director, including his name, age, position
with the Company, and the year he became a director of the Company.
<TABLE>
<CAPTION>
Director
Name Age Position with the Company Since
---- --- ------------------------- --------
<S> <C> <C> <C>
William O. Keyes . . . . . . . 64 Chairman of the Board, President,
Chief Executive Officer and Director 1990
William H. Flores . . . . . . . 40 Senior Vice President, Chief Financial
Officer, Assistant Secretary and Director 1990
Christopher M. Linneman . . . . 34 Director nominee --
Michael E. McMahon . . . . . . 46 Director nominee --
Howard H. Newman . . . . . . . 47 Director 1987
Herbert S. Winokur, Jr. . . . . 50 Director 1987
</TABLE>
William O. Keyes, a Director since March 1990, has been Chairman of the
Board, President and Chief Executive Officer of the Company since December
1991. He served as Vice Chairman of the Board and Senior Vice President of the
Company from March 1990 to December 1991. Prior thereto, Mr. Keyes served as
sole director, sole shareholder and President of Keyes Offshore, Inc. since its
organization in October 1977.
William H. Flores has been Senior Vice President, Chief Financial
Officer, Assistant Secretary and Director since March 1990. Prior thereto, Mr.
Flores served as Vice President--Finance for Keyes Offshore, Inc. since
December 1986.
Christopher M. Linneman has been nominated for the directorship
position being vacated by James E. Thomas. Mr. Linneman has been associated
with E. M. Warburg, Pincus & Co., Inc. since April 1990, and Vice President
since January 1992. Prior thereto, he served as Vice President with Drexel
Burnham Lambert Inc. from January 1989 to March 1990.
Michael E. McMahon has been nominated for the directorship position
being vacated by Michael R. Eisenson. Mr. McMahon has been a partner of Aeneas
Group, Inc., a subsidiary of Harvard Management Company, Inc., since January
1993. From 1989 through 1992, he was a Managing Director of Salomon Brothers,
Inc., and the co-head of the Energy and Chemicals group. From 1983 to 1989,
Mr. McMahon was a Managing Director of Lehman Brothers where he headed that
firm's Natural Resources Group. He is also a director of Triton Energy
Corporation and Tejas Power Corporation.
Howard H. Newman has been a director of the Company since 1987. Mr.
Newman has served as Managing Director of E.M. Warburg, Pincus & Co., Inc.
since 1987. He is also a director of ADVO, Inc., Comcast UK Cable Partners
Limited, Newfield Exploration Company and RenaissanceRe Holdings Ltd.
Herbert S. Winokur, Jr. has been a director of the Company since 1987.
Mr. Winokur has been President of Winokur & Associates, Inc., an investment and
management services firm, and Managing General Partner of Capricorn Investors,
L.P., a private investment partnership concentrating on investments in
restructuring situations, since 1987. He previously served as Senior Executive
Vice President and a Director of Penn Central Corporation from 1983 to 1987,
except for his position as Director to which he was elected in 1984. He is
Chairman of the Board of DynCorp and a Director of Enron Corporation, NHP, Inc.
and NacRe Corporation.
- -------------------------------------------------------------------------------
6
<PAGE> 9
- -------------------------------------------------------------------------------
BOARD OF DIRECTORS AND COMMITTEES
The Company's Board of Directors currently has six members. During
1993, the Board of Directors held eleven meetings. In addition, decisions
made by the Board of Directors were formalized during 1993 through the
execution of one unanimous written consent. The Board has two standing
committees which are discussed below: (i) the Personnel and Compensation
Committee and (ii) the Audit Committee; however, the Board does not have a
nominating committee.
PERSONNEL AND COMPENSATION COMMITTEE--The Personnel and Compensation
Committee of the Board of Directors of the Company (the ``Compensation
Committee'') consists of three members: Michael R. Eisenson, James E. Thomas
and Herbert S. Winokur, Jr. The Company expects that Christopher M. Linneman
and Michael E. McMahon will replace James E. Thomas and Michael R. Eisenson,
respectively, on the Compensation Committee. The purpose of the Compensation
Committee is to ensure that the Company has a broad plan of executive
compensation that is competitive and motivating to the degree that it will
attract, hold and inspire performance of managerial and other key personnel
thereby enhancing the growth and profitability of the Company. During 1993,
the Compensation Committee held three meetings.
AUDIT COMMITTEE--The Company's Audit Committee consists of two members:
Michael R. Eisenson and Howard H. Newman. The Company expects Michael E.
McMahon to replace Michael R. Eisenson on the Audit Committee. The functions
of the Audit Committee include reviewing and examining monthly detailed reports
submitted by the Chief Financial Officer of the Company, evaluating internal
controls and recommending the engagement and continuation of independent
auditors. During 1993, the Audit Committee held three meetings.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The directors and officers of the Company have no interlocking
relationships with the compensation committees (or their equivalent) of any
other entity.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 (the ``Exchange
Act'') requires the Company's directors and executive officers, and persons who
own more than ten percent of a registered class of the Company's equity
securities, to file by specific dates with the Securities and Exchange
Commission (``SEC'') initial reports of ownership and reports of changes in
ownership of Common Stock and other equity securities of the Company.
Officers, directors and greater than ten percent stockholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file. The Company is required to report in this proxy statement any
failure to file by the relevant due date any of these reports during the
preceding fiscal year.
To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended December 31, 1993, all
Section 16(a) filing requirements applicable to the Company's officers,
directors and greater than ten percent beneficial owners were timely satisfied
except as follows:
. Gerald T. Greak, the Company's Senior Vice President -- Marketing,
failed to timely report his acquisition of 1,000 shares of Common
Stock on July 7, 1993. The transaction was later reported on Form
5 filed February 14, 1994.
- -------------------------------------------------------------------------------
7
<PAGE> 10
- -------------------------------------------------------------------------------
EXECUTIVE COMPENSATION AND RELATED MATTERS
The following table sets forth information with respect to the five
executive officers of the Company:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
------------------------------------- ----------------------
OTHER ALL OTHER
ANNUAL STOCK COMPEN-
NAME AND COMPEN- OPTIONS/ LTIP SATION
PRINCIPAL POSITION YEAR SALARY BONUS (1) SATION (2) SARS (3) PAYOUTS (4)
- -------------------- ---- ---------- --------- ---------- -------- ------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
William O. Keyes (5) 1993 $165,000 $2,000,000 $ -- -- $ -- $16,186
Director, Chairman 1992 165,000 100,000 -- 400,000 -- 7,166
of the Board, 1991 155,625 71,000 -- -- -- 7,026
President & CEO
William H. Flores 1993 130,008 2,000,000 -- -- -- 9,751
Director, SVP, 1992 130,008 100,000 -- 402,400 -- 731
CFO & Asst. Secr. 1991 120,628 30,000 45,147 -- -- 1,293
Gerald T. Greak 1993 120,400 169,199 -- 75,000 -- 11,317
SVP--Marketing 1992 120,400 20,000 -- 201,800 -- 2,233
1991 104,508 20,000 -- -- -- 2,614
Hugh L. Adkins (6) 1993 100,000 176,499 -- 75,000 -- 8,404
SVP/Operations Mgr. 1992 95,833 15,000 -- 150,520 -- 1,073
Joan R. Smith (7) 1993 80,640 197,352 -- 40,000 -- 6,780
VP/Controller/Secr.
</TABLE>
- ------------------
Footnotes:
(1) Bonuses were earned and paid as follows:
<TABLE>
<CAPTION>
Name Amount Earned Paid
---- ----------- ------ ----
<S> <C> <C> <C>
William O. Keyes $ 2,000,000 * 1993 1993
100,000 1992 1992
30,000 1991 1992
41,000 1991 1991
William H. Flores 2,000,000 * 1993 1993
100,000 1992 1992
30,000 1991 1992
Gerald T. Greak 30,100 ** 1993 1994
30,100 ** 1993 1993
108,999 * 1993 1993
20,000 1992 1992
20,000 1991 1992
Hugh L. Adkins 25,000 ** 1993 1994
25,000 ** 1993 1993
126,499 * 1993 1993
15,000 1992 1992
Joan R. Smith 19,404 ** 1993 1994
19,404 ** 1993 1993
158,544 * 1993 1993
</TABLE>
* See ``--Bonus Agreements'' hereunder for additional information.
** Annual bonuses granted pursuant to the Marine Drilling 1992 Long
Term Incentive Plan. (notes continued on following page)
- -------------------------------------------------------------------------------
8
<PAGE> 11
- -------------------------------------------------------------------------------
Footnotes (continued) --
(2) ``Other Annual Compensation'' includes the value of perquisites when
such items exceed the lesser of $50,000 or 10% of the total of annual
``Salary'' and ``Bonus'' for each respective executive officer. The
amounts reported for Mr. Flores include relocation benefits of $43,947
in 1991 and relate to amounts reimbursed to him or paid on his behalf.
(3) Expressed in terms of the number of shares of the Company's Common
Stock subject to options granted during the years indicated.
(4) ``All Other Compensation'' includes the value of group life insurance
benefits provided on behalf of each respective executive officer, and
benefits related to the Marine Drilling Companies 401(k) Profit Sharing
Plan including (i) the value of the Company's matching contributions up
to 5% of qualified compensation and (ii) the value of forfeitures
allocated to each individual's account. The amounts reported are set
forth in detail below:
<TABLE>
<CAPTION>
Life 401(k) 401(k)
Name Year Insurance Match Forfeitures
---- ---- --------- --------- -----------
<S> <C> <C> <C> <C>
William O. Keyes 1993 $ 6,950 $ 8,994 $ 242
1992 6,950 -- 216
1991 6,248 -- 778
William H. Flores 1993 515 8,994 242
1992 515 -- 216
1991 515 -- 778
Gerald T. Greak 1993 2,081 8,994 242
1992 2,081 -- 152
1991 2,081 -- 533
Hugh L. Adkins 1993 1,044 7,118 242
1992 935 -- 138
Joan R. Smith 1993 319 6,219 242
</TABLE>
(5) Mr. Keyes was elected President and Chief Executive Officer on December
16, 1991. Prior to such time, Mr. Keyes served as Vice Chairman of the
Board and Senior Vice President--Operations.
(6) In accordance with the rules on executive compensation disclosure
adopted by the SEC, Mr. Adkins' compensation is not shown for years
prior to 1992, which was the year during which he first became an
executive officer.
(7) In accordance with the rules on executive compensation disclosure
adopted by the SEC, Ms. Smith's compensation is not shown for years
prior to 1993, which was the year during which she first became an
executive officer.
- -------------------------------------------------------------------------------
9
<PAGE> 12
- -------------------------------------------------------------------------------
BONUS AGREEMENTS
In 1991, the Company entered into bonus agreements with Messrs. Keyes
and Flores (the ``Bonus Agreements''). The Bonus Agreements provided, subject
to certain conditions, for a one-time cash bonus to each individual of $100,000
in the event of the consummation of a material business combination,
recapitalization or sale of debt or equity securities by the Company, such as
the Reorganization. Messrs. Keyes and Flores each received a $100,000 bonus in
1992 due to the consummation of the Reorganization. The Bonus Agreements also
provided for a cash bonus to each such individual equal to 1.2% of the amount
of the equity value of the Company in November 1993 in excess of the Base
Amount. The ``Base Amount'' was $60,000,000 increased by the fair market value
of certain securities issued by the Company after November 1991. The Base
Amount increased from $60,000,000 to $112,174,437 as a result of (i) the
Reorganization, (ii) the subsequent sales of Common Stock pursuant to a rights
offering, (iii) a common stock offering in June 1993, all of which are more
fully described in the Company's 1993 Annual Report, and (iv) various other
issuances of Common Stock.
In 1993, Mr. Keyes and Mr. Flores agreed to limit the amounts payable
to them, and the Company elected to pay to other employees the amounts by which
the bonuses payable to Mr. Keyes and Mr. Flores were reduced. The Company's
equity value in November 1993 calculated pursuant to the Bonus Agreements was
$297,007,639 ($6.80 per share) with the aggregate bonus amounts payable
thereunder equal to $4,435,996. The distribution of the bonus amounts was as
follows:
<TABLE>
<CAPTION>
Name Amount
---- -----------
<S> <C>
William O. Keyes $ 2,000,000
William H. Flores 2,000,000
Gerald T. Greak 108,999
Hugh L. Adkins 108,999
Joan R. Smith 158,544
Other Employees 59,454
------------
Aggregate Bonus Amount $ 4,435,996
============
</TABLE>
- -------------------------------------------------------------------------------
10
<PAGE> 13
- -------------------------------------------------------------------------------
STOCK OPTION GRANTS
The following table provides details regarding the stock options
indicated in the Summary Compensation Table as having been granted to the named
executive officers in 1993. In addition, in accordance with SEC rules, the
table illustrates the hypothetical gains or ``option spreads'' that could be
realized for the respective options, based on arbitrarily assumed rates of
annual compound stock price appreciation of 0%, 5% and 10% from the date the
options were granted over the full ten-year terms of the options. For
comparative purposes, the table also includes the hypothetical total gains that
could be realized over a ten-year period by the Company's stockholders using
those assumptions. No gain to the optionees is possible without an increase in
the stock price which will benefit all stockholders proportionately.
STOCK OPTION GRANTS IN 1993
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-------------------------------------------------
PERCENT OF EXERCISE POTENTIAL REALIZABLE VALUE AT ASSUMED
TOTAL OPTIONS OR BASE ANNUAL RATES OF STOCK PRICE
GRANTED TO PRICE APPRECIATION FOR OPTION TERM(2)
OPTIONS EMPLOYEES (PER EXPIRATION ----------------------------------------
NAME GRANTED(1) IN 1993 SHARE) DATE 0% 5% 10%
---- ---------- ----------- -------- ---------- -- -- ---
<S> <C> <C> <C> <C> <C> <C> <C>
All Stockholders(3) N/A N/A $6.00 N/A $-0- $165,099,143 $418,659,895
Gerald T. Greak 75,000 39.5% 6.00 06/29/2003 -0- 282,750 717,000
Hugh L. Adkins 75,000 39.5% 6.00 06/29/2003 -0- 282,750 717,000
Joan R. Smith 40,000 21.0% 6.00 06/29/2003 -0- 150,800 382,400
</TABLE>
- -------------
Footnotes:
(1) Reflects options to purchase the indicated numbers of shares of the
Company's Common Stock. All options granted to the named officers were
granted under the Marine Drilling 1992 Long Term Incentive Plan at
exercise prices equal to the closing market price of the Common Stock
on June 29, 1993 which was the date of the grants. All options granted
to the named officers have a four year vesting period with 25% vesting
on each anniversary of the date of grant until June 29, 1997. If a
``change in control'' (as defined in the plan) occurs, then all options
then outstanding shall become fully exercisable, and, unless otherwise
determined by the Compensation Committee, the value of outstanding
options (other than those granted within the prior six months to
persons subject to Section 16 of the Securities Exchange Act of 1934)
will be cashed out on the basis of the highest price paid (or offered)
during the preceding 60 day period.
(2) These amounts represent certain assumed rates of appreciation only, as
prescribed by the SEC. Actual gains, if any, on stock option exercises
or stock holdings are dependent on the future performance of the
Company's stock. There can be no assurance that the amounts reflected
in this table will be achieved. These calculations are not intended to
forecast possible future appreciation, if any, of the price of the
Company's Common Stock.
(3) Based on 43,792,876 shares of the Company's Common Stock outstanding on
April 1, 1994, using the $6.00 Common Stock closing price on June 29,
1993 as the base price.
- -------------------------------------------------------------------------------
11
<PAGE> 14
- -------------------------------------------------------------------------------
OPTION EXERCISES AND YEAR-END VALUES
The following table shows the number of shares covered by all
exercisable and non-exercisable stock options held by the named executive
officers as of December 31, 1993. Also reported are the year-end values for
their exercisable and unexercisable ``in-the-money'' options, which represent
the positive spread between the exercise price of any such options and the
year-end market price of the Common Stock.
AGGREGATED 1993 OPTION EXERCISES
AND YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
OPTIONS EXERCISED VALUE OF UNEXERCISED
---------------------- NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT YEAR-END AT YEAR-END (1)
ACQUIRED VALUE -------------------------- ----------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
William O. Keyes . . . 100,000 $450,000 -- 300,000 $ -- $1,350,000
William H. Flores . . . 102,400 460,800 -- 300,000 -- 1,350,000
Gerald T. Greak . . . . -- -- 51,800 225,000 223,100 675,000
Hugh L. Adkins . . . . -- -- 38,020 187,500 171,090 506,250
Joan R. Smith . . . . . 19,270 86,715 -- 96,250 -- 433,125
</TABLE>
(1) This valuation represents the difference between $5.75, the closing price
of the Common Stock on the Nasdaq Stock Market on December 31, 1993 and
the exercise prices of the stock options.
PERSONNEL AND COMPENSATION COMMITTEE REPORT
REGARDING EXECUTIVE COMPENSATION
COMPENSATION POLICY REGARDING EXECUTIVE OFFICERS
The Compensation Committee is responsible for the design of the
Company's compensation and incentive programs. The Compensation Committee is
composed of the three undersigned individuals who are each non-officer
directors. The Compensation Committee's goal is to develop and implement
compensation and incentive programs which cause the Company's officers and
employees to focus on increasing shareholder value as well as retaining and
motivating employees who are capable of furthering that goal.
The Compensation Committee has established a three-part program with
respect to employee compensation. The first component involves providing base
salaries which approximate the average for companies comprising the offshore
contract drilling industry. The Compensation Committee has not conducted a
formal review in this regard; however, it believes that the Company's base
salaries generally fall within this range. The second and third components
were developed through the design of the Marine Drilling 1992 Long Term
Incentive Plan (the ``Plan'') which was approved by the Company's shareholders
on October 29, 1992. The second component includes the payment of performance
bonuses which are based upon (i) the Company's achievement of certain goals
with respect to its safety record, its financial performance and its
operational performance, (ii) each individual employee's performance in
furtherance of those goals, and (iii) each employee's achievement of individual
objectives (as applicable). The third component provides for the grant of long
term equity-based incentives through the utilization of stock options,
restricted stock and stock appreciation rights.
- -------------------------------------------------------------------------------
12
<PAGE> 15
- -------------------------------------------------------------------------------
With respect to the establishment of compensation for each executive
officer, the Compensation Committee considers an individual's past performance
and skills, as well as the individual's ability to enhance shareholder value.
The Compensation Committee and the Company's management are currently developing
the Company's and individual employee performance award targets and payouts for
1994 and 1995.
COMPENSATION OF CERTAIN EXECUTIVE OFFICERS
In November 1991, in light of a deteriorating offshore drilling
industry and the Company's precarious financial position, the Compensation
Committee developed a program to retain three of its executive officers whom it
considered to be of key importance to the Company's pending restructuring and
ultimate survival. Those individuals included the Company's Chief Executive
Officer at the time, Mr. Dan O. Dennis; its Senior Vice President of
Operations, Mr. William O. Keyes; and its Senior Vice President and Chief
Financial Officer, Mr. William H. Flores. Mr. Dennis resigned in December
1991 and Mr. Keyes was concurrently appointed Chief Executive Officer. The
program included a bonus agreement involving the payment of (a) a $100,000
bonus payable in connection with the consummation of a restructuring
transaction and (b) a bonus tied to improvements in the Company's shareholder
value as defined therein. See Executive Compensation and Related
Matters--Bonus Agreements for a further discussion regarding the specifics of
these agreements. Messrs. Keyes, Flores and Dennis each received a $100,000
bonus in November as a result of the Company's Reorganization on October 29,
1992. In addition, Messrs. Keyes and Flores subsequently received bonuses
based upon the Company's value in November 1993. The Compensation Committee
believes that these programs had a significant impact on the Company as
evidenced by the dramatic improvement in its operations, profitability and
capital structure during the period from November 1991 to November 1993.
DISCUSSION REGARDING COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
The Compensation Committee has established the 1994 base salary of the
Company's Chief Executive Officer, $180,000 at a level which it believes is
approximately average for companies of comparable size in the offshore drilling
industry. In 1992, the Company granted Mr. Keyes a stock option of significant
size, 400,000 shares, which its believes will maintain a close alignment
between Mr. Keyes' performance and the shareholder value of the Company. Mr.
Keyes will be eligible for a performance bonus in 1994 pursuant to the Plan in
an amount up to 50% of his base salary as determined by the Company's
attainment of certain financial objectives. The Compensation Committee
believes that Mr. Keyes' experience, reputation, performance and impact on the
Company's performance justify and reaffirm his compensation and incentive
package.
April 1, 1994 The Personnel and Compensation Committee
Michael R. Eisenson
James E. Thomas
Herbert S. Winokur, Jr.
- -------------------------------------------------------------------------------
13
<PAGE> 16
- -------------------------------------------------------------------------------
CUMULATIVE TOTAL SHAREHOLDER RETURN OR
COMPARATIVE STOCK PERFORMANCE
The line graphs on the following page compare the changes in the
cumulative total shareholder returns from the end of July 1989 (the month in
which the Company's equity was registered under Section 12 of the Securities
Exchange Act of 1934) through the end of 1993 and as of October 1992 (the month
of the Reorganization) through the end of 1993, of (i) the Company, (ii) the
CRSP Total Return Index for the NASDAQ Stock Market (the ``NASDAQ Index'') and
(iii) the Simmons & Company International Offshore Drillers Index (the ``SCI
Index''). Due to the significant change in the Company's capital structure
pursuant to the Reorganization and its financial results since that time, the
Company has included a graph illustrating its performance since October 1992 as
compared to the NASDAQ Index and the SCI Index.
The companies that comprise the SCI Index include the Company; Arethusa
(Off-shore) Ltd; Atwood Oceanics, Inc.; Chiles Offshore Corporation; Cliffs
Drilling Company; Dual Drilling Company; Energy Service Company, Inc.; Global
Marine, Inc.; Noble Drilling Corporation; Reading & Bates Corporation; Rowan
Companies, Inc.; and Sonat Offshore Drilling, Inc. The graphs on the following
page assume that $100 was invested in each of these categories on July 28, 1989
or October 29, 1992, and that all dividends were re-invested. The Company has
not paid any cash dividends during the periods covered by the graphs.
- -------------------------------------------------------------------------------
14
<PAGE> 17
- -------------------------------------------------------------------------------
COMPARISON OF TOTAL RETURNS AMONG THE COMPANY,
THE NASDAQ INDEX AND THE SCI INDEX
JULY 28, 1989 TO DECEMBER 31, 1993
Jul 89 Dec 89 Dec 90 Dec 91 Dec 92 Dec 93
------ ------ ------ ------ ------ ------
The Company $100.0 $ 98.6 $ 56.5 $ 1.8 $ 0.6 $ 2.7
NASDAQ Index 100.0 100.6 85.4 137.1 159.4 181.9
SCI Index 100.0 128.2 107.2 61.1 63.4 106.4
OCTOBER 29, 1992 TO DECEMBER 31, 1993
Oct 92 Dec 92 Mar 93 Jun 93 Sep 93 Dec 93
------ ------ ------ ------ ------ ------
The Company $100.0 $ 42.9 $128.6 $228.6 $264.3 $192.9
NASDAQ Index 100.0 111.9 114.0 116.2 125.9 127.7
SCI Index 100.0 81.3 118.0 147.0 157.8 136.4
- -------------------------------------------------------------------------------
15
<PAGE> 18
- -------------------------------------------------------------------------------
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Warburg, Aeneas, Capricorn, Mr. Keyes and Chase obtained significant
registration rights pursuant to the Registration Rights Agreement entered into
in connection with the consummation of the Reorganization. Pursuant to the
Registration Rights Agreement, the Company has agreed to use its best efforts
to keep a registration statement in effect for three years from October 29,
1992 covering the resale of all shares of Common Stock acquired by those
parties.
In connection with the Reorganization, the Company, Warburg, Aeneas,
Capricorn, Chase and Mr. Keyes entered into the Shareholders' Agreement. At
April 1, 1994, Warburg and the Company are the only parties to the
Shareholders' Agreement. See Item 1 - Election of Directors- -Shareholders'
Agreement.
In April 1993, William H. Flores, Director, Senior Vice President and
Chief Financial Officer of the Company, borrowed $100,000 from the Company
pursuant to a note due December 15, 1993 which accrued interest at six percent
(6%). In November 1993, Mr. Flores borrowed $320,160 from the Company
primarily to exercise stock options pursuant to notes due December 15, 1993
which accrued interest at six percent (6%). In December 1993, Mr. Flores paid
off all notes and accrued interest thereon. As of April 1, 1994 no amounts
were outstanding.
- -------------------------------------------------------------------------------
16
<PAGE> 19
- -------------------------------------------------------------------------------
ITEM 2 - RATIFICATION OF
APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed KPMG Peat Marwick as independent
certified public accountants for the Company and its subsidiaries for fiscal
year 1994. It is intended that such appointment be submitted to the
stockholders for ratification at the 1994 Annual Meeting of Stockholders. KPMG
Peat Marwick has served as the Company's auditors since the formation of the
Company's predecessor and has no investment in the Company or its subsidiaries.
Although the submission of this matter to the stockholders is not
required by law, the Board of Directors will reconsider its selection of
independent accountants if this appointment is not ratified by the
stockholders. Ratification will require the affirmative vote of the majority
of the shares of Common Stock represented at the meeting and eligible to vote
thereon, in person or by proxy.
A representative of KPMG Peat Marwick will be in attendance at the
Annual Meeting, during which they will be given the opportunity to make a
statement should he/she desire to do so and that he/she will be available to
respond to appropriate questions.
STOCKHOLDERS' PROPOSALS
Pursuant to the Securities Exchange Act of 1934, as amended, and
regulations thereunder, individual stockholders have a limited right to propose
for inclusion in the proxy statement a single proposal for action to be taken
at the Annual Meeting of Stockholders. Proposals intended to be presented at
the Annual Meeting to be held in 1995 must be received by the Company's
principal executive offices no later than December 2, 1994. They may be
addressed to the Secretary of the Company at 14141 Southwest Freeway, Suite
2500, Sugar Land, Texas 77478-3435.
OTHER MATTERS
While management has no reason to believe that any other business will
be presented, if any other matters should properly come before the Annual
Meeting, the proxies will be voted as to such matters in accordance with the
best judgment of the proxy holders. The approval of such other matters will
require the affirmative vote of the majority of the shares of Common Stock
represented at the meeting and eligible to vote thereon, in person or by proxy.
MARINE DRILLING COMPANIES, INC.
By Joan R. Smith
Secretary
Sugar Land, Texas
April 1, 1994
- -------------------------------------------------------------------------------
17
<PAGE> 20
X Please mark your
votes as in this
example.
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
FOR all WITHHOLD
nominees AUTHORITY to
listed vote for all
nominees listed Nominees: William O. Keyes FOR AGAINST ABSTAIN
1. Election of William H. Flores 2. Ratification of KPMG
Directors Christopher M. Linneman Peat Marwick as
Michael E. McMahon Independent Auditors.
FOR, all nominees listed except vote withheld Howard H. Newman
for the following nominee(s): Herbert S. Winokur, Jr. 3. In their discretion, upon
any other matter which may
properly come before the
the meeting or at any
_____________________________________________ adjournment or postponement
thereof.
</TABLE>
<TABLE>
<S> <C>
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS
DIRECTED. IF NO DIRECTION IS MADE, THE PERSONS
NAMED HEREIN INTEND TO VOTE FOR THE ELECTION OF THE
NAMED NOMINEES FOR DIRECTOR AND FOR PROPOSAL 2.
PLEASE DATE AND SIGN THIS PROXY AND RETURN IT
PROMPTLY IN THE ENCLOSED POSTAGE PAID ENVELOPE.
</TABLE>
<TABLE>
<S> <C>
SIGNATURE(S)___________________________________________________________________________________ DATE_______________________________
Note: Please sign exactly as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such.
</TABLE>
<PAGE> 21
MARINE DRILLING COMPANIES, INC.
PROXY SOLICITATED ON BEHALF OF BOARD OF DIRECTORS
The undersigned hereby appoints Joan R. Smith and William H. Flores, or
either of them with full power of substitution, proxies to vote at the Annual
Meeting of Stockholders of Marine Drilling Companies, Inc. (the "Company") to
be held in the One Sugar Creek Place Auditorium on the first floor of the
Company's headquarters located at 14141 Southwest Freeway, Sugar Land, Texas on
Wednesday, May 4, 1994 at 9:00 a.m., central daylight time, and at all
adjournments or postponements thereof, hereby revoking any proxies heretofore
given, all shares of common stock of the Company held or owned by the
undersigned as directed hereon.
(TO BE SIGNED ON REVERSE SIDE)
