SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material under Rule 14a-12
NOBLE CORPORATION
(Name of Registrant as Specified In Its Charter)
NOBLE CORPORATION
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
........................................................................
2) Aggregate number of securities to which transaction applies:
........................................................................
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
........................................................................
4) Proposed maximum aggregate value of transaction:
........................................................................
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:
........................................................................
2) Form, Schedule or Registration Statement No.:
........................................................................
3) Filing Party:
........................................................................
4) Date Filed:
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(NOBLE LOGO)
NOBLE CORPORATION
13135 SOUTH DAIRY ASHFORD, SUITE 800
SUGAR LAND, TEXAS 77478
NOTICE OF ANNUAL GENERAL MEETING OF MEMBERS
TO BE HELD ON APRIL 24, 2003
To the Members of
Noble Corporation:
The annual general meeting of members of Noble Corporation, a Cayman
Islands exempted company limited by shares (the "Company"), will be held on
Thursday, April 24, 2003, at 10:00 a.m., local time, at the St. Regis Hotel,
1919 Briar Oaks Lane, Houston, Texas, for the following purposes:
1. To elect two directors to the class of directors whose three-year
term will expire in 2006; and
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 6, 2003 as
the record date for the determination of members entitled to notice of and to
vote at the annual general meeting or any adjournment thereof. Only holders of
record of ordinary shares of the Company at the close of business on the record
date are entitled to notice of and to vote at the meeting. A complete list of
such members will be available for examination at the offices of the Company in
Sugar Land, Texas during normal business hours for a period of 10 days prior to
the meeting.
A record of the Company's activities during 2002 and financial statements
for the fiscal year ended December 31, 2002 are contained in the accompanying
2002 Annual Report. The Annual Report does not form any part of the material for
solicitation of proxies.
Your vote is important. All members are cordially invited to attend the
meeting. We urge you, whether or not you plan to attend the meeting, to submit
your proxy by telephone, via the Internet or by completing, signing, dating and
mailing the enclosed proxy or voting instruction card in the postage-paid
envelope provided. If a member who has submitted a proxy attends the meeting in
person, such member may revoke the proxy and vote in person on all matters
submitted at the meeting.
By Order of the Board of Directors
Julie J. Robertson
Secretary
Sugar Land, Texas
March 14, 2003
(NOBLE LOGO)
NOBLE CORPORATION
13135 SOUTH DAIRY ASHFORD, SUITE 800
SUGAR LAND, TEXAS 77478
PROXY STATEMENT
FOR ANNUAL GENERAL MEETING OF MEMBERS
TO BE HELD ON APRIL 24, 2003
GENERAL
This proxy statement is furnished to members of Noble Corporation (the
"Company") in connection with the solicitation by our board of directors of
proxies for use at the annual general meeting of members to be held at the time
and place and for the purposes set forth in the accompanying notice. The
approximate date of mailing of this proxy statement and the accompanying proxy
or voting instruction card is March 18, 2003.
PROXIES AND VOTING INSTRUCTIONS
If you hold ordinary shares, par value $.10 per share, of the Company
("Ordinary Shares") in your name, you can submit your proxy in three convenient
ways:
o TELEPHONE - Call toll free 1-800-850-5909 (24 hours a day, seven days
a week) and follow the instructions given. You will need to give the
Control Number set forth on your proxy card accompanying this proxy
statement. This method of submitting your proxy is available for
residents of the United States and Canada only, and is available until
5:00 p.m. Eastern Time on Wednesday, April 23, 2003.
o INTERNET - Visit http://proxy.georgeson.com. Enter the Company Number
and Control Number from your proxy card and follow the instructions
given. This method of submitting your proxy will be available until
5:00 p.m. Eastern Time on Wednesday, April 23, 2003.
o PROXY CARD - Complete, sign and date your proxy card and mail it in
the postage paid envelope provided. Proxy cards must be received by us
before voting begins at the annual general meeting.
If you hold Ordinary Shares through someone else, such as a bank, broker or
other nominee, you may get material from them asking you how you want to vote
your shares. You should check to see if they offer telephone or Internet voting.
You may revoke your proxy at any time prior to its exercise by:
o Giving written notice of the revocation to our corporate secretary;
o Appearing and voting in person at the annual general meeting; or
o Properly submitting a later-dated proxy by telephone, via the Internet
or by delivering a later-dated proxy card to our corporate secretary.
If you attend the annual general meeting in person without voting, this
will not automatically revoke your proxy. If you revoke your proxy during the
meeting, this will not affect any vote previously taken. If you hold
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Ordinary Shares through someone else, such as a bank, broker or other nominee,
and you desire to revoke your proxy, you should follow the instructions provided
by your nominee.
If you were a participant in the Noble Drilling Corporation 401(k) Savings
Plan on the record date for the meeting, you should receive a voting instruction
card. You can provide instructions to the plan trustee as to how to vote
Ordinary Shares held in the plan by calling the telephone number or visiting the
Internet site as set forth above, or by completing, signing and dating the
voting instruction card and mailing it in the postage paid envelope.
VOTING PROCEDURES AND TABULATION
The Company will appoint one or more inspectors of election to act at the
annual general meeting and to make a written report thereof. Prior to the annual
general meeting, the inspectors will sign an oath to perform their duties in an
impartial manner and according to the best of their ability. The inspectors will
ascertain the number of Ordinary Shares outstanding and the voting power of
each, determine the Ordinary Shares represented at the annual general meeting
and the validity of proxies and ballots, count all votes and ballots, and
perform certain other duties as required by law. The determination of the
inspectors as to the validity of proxies will be final and binding.
With regard to the election of directors, votes may be cast in favor of or
withheld from each nominee. Votes that are withheld will be excluded entirely
from the vote and will have no effect. Under the rules of the New York Stock
Exchange, brokers who hold shares in street name have the authority to vote on
certain "routine" items (such as the election of directors) when they have not
received instructions from beneficial owners. Brokers will have discretionary
authority to vote for the election of directors of the Company. Under applicable
Cayman Islands law, a broker non-vote (or other limited proxy) will have no
effect on the outcome of the election of directors.
VOTING SECURITIES
Our only outstanding voting securities are our Ordinary Shares. Only
holders of record of Ordinary Shares at the close of business on March 6, 2003,
the record date for the annual general meeting, are entitled to notice of and to
vote at the annual general meeting. On the record date for the annual general
meeting, there were 133,578,905 Ordinary Shares outstanding and entitled to be
voted at the annual general meeting. A majority of such shares, present in
person or represented by proxy, is necessary to constitute a quorum. Each
Ordinary Share is entitled to one vote. Under Cayman Islands law, the holders of
our Ordinary Shares do not have appraisal rights with respect to matters to be
voted upon at the annual general meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth as of December 31, 2002 information with
respect to the only persons who were known to the Company to be the beneficial
owners of more than five percent of our outstanding Ordinary Shares.
ORDINARY SHARES BENEFICIALLY OWNED
------------------------------------------
NAME AND ADDRESS OF BENEFICIAL OWNER NUMBER OF SHARES PERCENT OF CLASS
------------------------------------ ---------------------- ------------------
FMR Corp...................................................... 19,523,789 (1) 14.781%
82 Devonshire Street
Boston, Massachusetts 02109
Putnam, LLC d/b/a Putnam Investments.......................... 8,594,486 (2) 6.4%
One Post Office Square
Boston, Massachusetts 02109
Massachusetts Financial Services Company...................... 7,822,388 (3) 5.84%
500 Boylston Street
Boston, Massachusetts 02116
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(1) According to a Schedule 13G (Amendment No. 6), dated February 14, 2003,
filed with the Securities and Exchange Commission (the "SEC") by FMR Corp.
jointly with Edward C. Johnson 3d, Abigail P. Johnson and Fidelity
Management & Research Company ("Fidelity"), the amount beneficially owned
includes (i)
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16,711,255 Ordinary Shares owned by several investment companies ("Funds")
for which Fidelity Management & Research Company ("Fidelity") acts as
investment adviser, (ii) 634,304 Ordinary Shares owned by Fidelity
Management Trust Company ("FMTC") in its capacity as investment manager of
certain institutional accounts, (iii) 455 Ordinary Shares beneficially
owned by Geode Capital Management, LLC (whose managers are shareholders and
employees of FMR Corp.) in its capacity as investment adviser and (iv)
2,177,775 Ordinary Shares beneficially owned by Fidelity International
Limited ("FIL") in its capacity as investment adviser to certain
international funds and institutional investors. FMR Corp. is the parent of
Fidelity and FMTC and is controlled by Edward C. Johnson 3d. Neither FMR
Corp. nor Mr. Johnson has sole voting power with respect to the Ordinary
Shares owned by the Funds. Mr. Johnson and FMR Corp., through its control
of FMTC, each has sole investment power with respect to 634,304 of such
Ordinary Shares and sole voting power with respect to 590,004 of such
Ordinary Shares. Though Mr. Johnson and his family indirectly own shares of
voting stock of FIL entitling them to cast approximately 40% of the FIL
stockholder votes, and Mr. Johnson is chairman of FIL, FMR and FIL do not
believe that they should be required to attribute to each other the
beneficial ownership of securities they individually beneficially own.
(2) According to a Schedule 13G (Amendment No. 1), dated February 14, 2003,
filed with the SEC by Putnam, LLC (d/b/a Putnam Investments) ("PI") jointly
with Marsh & McLennan Companies, Inc., the parent holding company of PI,
Putnam Investment Management, LLC ("PIM") and The Putnam Advisory Company,
LLC ("PAC"), the amount beneficially owned includes (i) 8,594,486 Ordinary
Shares beneficially owned by PI, with respect to which it has shared
investment power of all such shares and shared voting power for 660,914 of
such shares, (ii) 7,782,473 Ordinary Shares beneficially owned by PIM, with
respect to which it has shared investment power of all of such shares and
shared voting power for 281,278 of such shares, and (iii) 812,013 Ordinary
Shares beneficially owned by PAC, with respect to which it has shared
investment power of all of such shares and shared voting power for 379,636
of such shares. PIM and PAC are investment advisors wholly owned by PI.
(3) According to a Schedule 13G (Amendment No. 4), dated February 12, 2003,
filed with the SEC, Massachusetts Financial Services Company has sole
investment power with respect to all of such Ordinary Shares and sole
voting power with respect to 7,768,038 of such Ordinary Shares.
ELECTION OF DIRECTORS
Our Memorandum and Articles of Association provide for three classes of
directors, with approximately one-third of the directors constituting the Board
being elected each year to serve a three-year term. There are three directors
comprising the class whose term expires at the 2003 annual general meeting:
Robert D. Campbell, James C. Day and Marc E. Leland. In accordance with our
Articles of Association, the Board has reduced the number of directors
constituting the entire board of directors to seven, effective immediately after
the annual general meeting, and has nominated Messrs. Day and Leland for
re-election as directors of the Company to serve three-year terms expiring in
2006.
The directors nominated for election this year will be elected by a
plurality of the Ordinary Shares present in person or represented by proxy at
the annual general meeting and entitled to vote. All duly submitted and
unrevoked proxies will be voted for the nominees selected by the board of
directors, except where authorization so to vote is withheld. THE BOARD
RECOMMENDS THAT MEMBERS VOTE FOR THE ELECTION OF ITS NOMINEES FOR DIRECTOR.
Information with respect to the directors nominated for election this year,
and the directors whose terms do not expire at the 2003 annual general meeting,
is presented below.
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NOMINEES FOR DIRECTORS
JAMES C. DAY,
age 59, director since 1983 Mr. Day has served as Chairman of the Board of the Company since October 22, 1992
and as Chief Executive Officer of the Company since January 1, 1984 and he served as
President from January 1, 1984 to January 1, 1999. From January 1983 until his
election as President and Chief Executive Officer, Mr. Day served as Vice President
of the Company. Mr. Day is also a director of Global Industries, Ltd. and Noble
Energy, Inc., and a trustee of The Samuel Roberts Noble Foundation, Inc.
MARC E. LELAND,
age 64, director since 1994 Mr. Leland has served since 1984 as President of Marc E. Leland & Associates, Inc.,
a company engaged in the business of providing financial advisory services. Mr.
Leland is also a director of Chartwell Leisure Inc.
CLASS WHOSE TERM EXPIRES IN 2004
MICHAEL A. CAWLEY,
age 55, director since 1985 Mr. Cawley has served as President and Chief Executive Officer of The Samuel Roberts
Noble Foundation, Inc. (the "Foundation") since February 1, 1992, after serving as
Executive Vice President of the Foundation since January 1, 1991. Mr. Cawley has
served as a trustee of the Foundation since 1988. For more than five years prior to
1991, Mr. Cawley was the President of Thompson & Cawley, a professional corporation,
attorneys at law; and Mr. Cawley currently serves as of counsel to the law firm of
Thompson, Cawley, Veazey & Burns, a professional corporation. Mr. Cawley is also a
director of Noble Energy, Inc. and Panhandle Royalty Company.
LUKE R. CORBETT,
age 56, director since 2001 Mr. Corbett has served as Chairman of the Board and Chief Executive Officer of
Kerr-McGee Corporation since May 1999, and also from February 1997 to February 1999.
Between February 1999 and May 1999, he served as Chief Executive Officer of
Kerr-McGee, and from 1995 to 1997, he served as President and Chief Operating
Officer of Kerr-McGee. Mr. Corbett has served as a director of Kerr-McGee since
1995. He is also a director of OGE Energy Corporation and BOK Financial Corporation.
JACK E. LITTLE,
age 64, director since 2000 Mr. Little was President and Chief Executive Officer of Shell Oil Company,
and a member of the Board of Directors and Chairman and Chief Executive
Officer of Shell Exploration & Production Company for more than five years
until his retirement in June 1999. Mr. Little is also a director of TXU
Corp.
CLASS WHOSE TERM EXPIRES IN 2005
LAWRENCE J. CHAZEN,
age 62, director since 1994 Mr. Chazen has served since 1977 as Chief Executive Officer of Lawrence J. Chazen,
Inc., a California registered investment adviser engaged in providing financial
advisory services.
WILLIAM A. SEARS,
age 68, director since 1998 Mr. Sears retired from his position as Director of Operations for British Petroleum
Exploration in 1997, after serving with them in various positions since 1983.
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ADDITIONAL INFORMATION REGARDING THE BOARD OF DIRECTORS
BOARD MEETINGS AND COMMITTEES
During 2002, the board of directors held six meetings. Each of the eight
directors attended all of the Board meetings. The Company has standing audit,
compensation, finance, and nominating and corporate governance committees of the
board of directors. The current members of the committees, number of meetings
held by each committee in 2002, and a brief description of the functions
performed by each committee are set forth below:
Audit Committee (six meetings). The current members of the audit
committee are Jack E. Little, Chairman; Lawrence J. Chazen and William A.
Sears. Each of the members attended all meetings of the audit committee
held during 2002. The primary responsibilities of the audit committee are
to review with our auditors our financial reports (and other financial
information) provided to the SEC and the investing public and to assist our
board of directors with oversight of the integrity of our financial
statements, our compliance with business ethics and legal and regulatory
requirements, the qualification and independence of our independent
auditors and the performance of our independent and internal auditors. The
audit committee's report relating to the 2002 fiscal year begins on page 17
of this proxy statement.
Compensation Committee (four meetings). The current members of the
compensation committee are Michael A. Cawley, Chairman; Luke R. Corbett;
and Marc E. Leland. Each of the members attended all meetings of the
compensation committee held in 2002. The primary responsibilities of the
compensation committee are to discharge our board of director's
responsibilities relating to compensation of directors and executive
officers, to assist the board of directors in reviewing and administering
compensation, benefits, incentive and share based compensation plans and to
produce an annual report on executive compensation. The compensation
committee's report relating to the 2002 fiscal year begins on page 8 of
this proxy statement.
Finance Committee (four meetings). The current members of the finance
committee are Marc E. Leland, Chairman; Robert D. Campbell; and William A.
Sears. Each of the members attended all meetings of the finance committee
held in 2002. The primary responsibility of the finance committee is to
assist our board of directors in fulfilling its oversight function with
respect to our financial affairs and policies, including capital
requirements and structure, share repurchase programs, dividend policy and
long-range financial strategic planning.
Nominating and Corporate Governance Committee (three meetings). The
current members of the nominating and corporate governance committee are
Lawrence J. Chazen, Chairman; and Michael A. Cawley. Each of the members
attended all meetings of the committee. The primary responsibility of the
nominating and corporate governance committee is to assist the board of
directors in reviewing, evaluating, selecting and recommending director
nominees when one or more directors are to be appointed, elected or
re-elected to the Board. The nominating and corporate governance committee
is also responsible for overseeing, developing and recommending to the
board of directors' principles, policies and practices relating to
corporate governance. The nominating and corporate governance committee
will consider nominees for director recommended by members entitled to vote
for the election of directors, provided that such recommendations are made
in accordance with our articles of association. Generally, our articles of
association provide that a member must deliver written notice to our
corporate secretary not later than 90 days prior to the annual general
meeting naming such member's nominee(s) for director and specifying certain
information concerning such member and nominee(s). We did not receive any
member recommendations for nominees for election of directors at the annual
general meeting.
Compensation Committee Interlocks and Insider Participation. The current
members of the compensation committee identified above were the only persons who
served on such committee during 2002. Mr. Day and Mr. Campbell both serve as
executive officers of certain wholly owned subsidiaries of the Company. However,
Mr. Day's and Mr. Campbell's compensation is set solely by the compensation
committee of our board of directors, and they receive no additional compensation
for performing duties as executive officers or directors of these subsidiaries.
Neither Mr. Day nor Mr. Campbell, nor any other officer or employee of the
Company or its subsidiaries is a member of the Company's compensation committee.
DIRECTOR EDUCATION
We provide our directors with information and materials that are designed
to assist them in performing their duties as Board members. We provide director
manuals, periodic presentations on new developments in relevant
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areas, such as legal and accounting matters, as well as opportunities to attend
director education programs at the Company's expense. Our director manual
includes important information about the Company and the responsibilities of our
directors, including: our memorandum and articles of association; guidelines for
assignments regarding standing committees of the Board; the charters for each of
our Board committees; a summary of laws and SEC rules regarding insider trading
and short swing profits; our Code of Business Conduct; corporate directors'
guidebooks published by such organizations as the National Association of
Corporate Directors and the American Society of Corporate Secretaries; a
statement of the Noble paradigm that governs how we do our business; and our
safety policy and quality policy and objectives.
COMPENSATION OF DIRECTORS
The compensation committee of the board of directors sets the compensation
of our directors. In determining the appropriate level of compensation for our
directors, the compensation committee considers the commitment required from our
directors in performing their duties on behalf of the Company, as well as
comparative information the committee obtains from the compensation consulting
firm of Towers Perrin and from other sources. Set forth below is a brief
description of the compensation of our directors.
Annual Retainer and Other Fees and Expenses. We pay our non-employee
directors an annual retainer of $35,000, of which $7,000 is paid in Ordinary
Shares pursuant to the Equity Compensation Plan for Non-Employee Directors (the
"Directors' Plan"). Under the Directors' Plan, non-employee directors may elect
to receive the balance in Ordinary Shares or cash. We also pay our non-employee
directors a Board meeting fee of $2,000 and a committee meeting fee of $1,500.
The chairman of a standing Board committee receives an additional $1,000 per
committee meeting. We pay each director who is also one of our officers a fee of
$100 for each Board meeting attended. We also reimburse directors for travel,
lodging and related expenses they may incur in attending Board and committee
meetings.
Non-Employee Director Stock Options. The 1992 Nonqualified Stock Option
Plan for Non-Employee Directors (the "1992 Plan") was approved and ratified by
stockholders of Noble Drilling Corporation at its 1993 annual meeting of
stockholders and amended with stockholder approval in 2001 and 2002. Under the
1992 Plan, non-employee directors receive a one-time grant of an option to
purchase 10,000 Ordinary Shares of the Company. Thereafter, on the next business
day after each annual general meeting of members of the Company, such directors
receive an annual grant of an option to purchase 7,500 Ordinary Shares of the
Company. The options are granted at fair market value on the grant date and are
exercisable from time to time over a period commencing one year from the grant
date and ending on the expiration of 10 years from the grant date, unless
terminated sooner as described in the 1992 Plan.
EMPLOYMENT AGREEMENTS
The Company has entered into employment agreements with each named
executive officer listed in the Summary Compensation Table appearing on page 11
of this proxy statement. These employment agreements become effective upon a
change of control of the Company (within the meaning set forth in the
agreements) or a termination of employment in connection with or in anticipation
of a change of control, and remain effective for three years thereafter.
The agreements provide that if the officer's employment is terminated
within three years after a change of control or prior to but in anticipation of
a change of control, either (1) by us for reasons other than death, disability
or "cause" (as defined in the agreement) or (2) by the officer for "good reason"
(which term includes a diminution of responsibilities or compensation, or a
determination by the officer to leave during the 30-day period immediately
following the first anniversary of the change of control), the officer will
receive: (a) any unpaid portion of his current salary and prorated portion of
his highest bonus paid either in the last three years before the change of
control or for the last completed fiscal year after the change of control (the
"Highest Bonus"); (b) a lump sum payment equal to three times the sum of his
annual base salary (based on the highest monthly salary paid in the 12 months
prior to the change of control) and his Highest Bonus; (c) benefits to him and
his family at least equal to those which would have been provided had the
employment not been terminated for a three-year period; (d) any compensation
previously deferred by the officer (together with any accrued interest or
earnings thereon) and any accrued vacation pay; and (e) a lump sum amount equal
to the excess of (i) the actuarial equivalent of the benefit under the qualified
defined benefit retirement plan of the Company and its affiliated companies in
which the officer is eligible to participate had the officer's employment
continued for three years after termination over (ii) the actuarial equivalent
of the officer's actual benefit under such plans. The agreements also require
the Company to make an additional payment in an amount such that after the
payment of all income and excise taxes, the officer will
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be in the same after-tax position as if no excise tax under Section 4999 (the
so-called Parachute Payment excise tax) of the U.S. Internal Revenue Code of
1986, if any, had been imposed.
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth as of March 6, 2002 the beneficial ownership
of Ordinary Shares by each of our directors, each "named executive officer" of
the Company listed in the Summary Compensation Table appearing on page 11 of
this proxy statement and all of our directors and executive officers as a group.
COMMON STOCK
BENEFICIALLY OWNED (1)
-----------------------------------
NUMBER OF PERCENT OF
NAME SHARES CLASS (2)
---- ------------ -----------
Directors
Robert D. Campbell................................................ 301,942 (3) 0.23%
Michael A. Cawley................................................. 925,177 (3) (4) 0.69%
Lawrence J. Chazen................................................ 22,336 (3) -
Luke R. Corbett................................................... 10,335 (3) -
James C. Day...................................................... 1,473,698 (3) (4) 1.10%
Marc E. Leland.................................................... 40,195 (3) -
Jack E. Little.................................................... 25,026 -
William A. Sears.................................................. 44,108 (3) -
Named Executive Officers (excluding any
Director above) and Group
Mark A. Jackson................................................... 100,974 (3) -
Danny W. Adkins................................................... 263,422 (3) 0.20%
Julie J. Robertson................................................ 331,490 (3) 0.25%
All directors and executive officers as a group (11 persons)...... 2,664,084 (5) 1.98%
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(1) Unless otherwise indicated, the beneficial owner has sole voting and
investment power with respect to all shares listed.
(2) The percent of class shown is less than one-tenth of one percent unless
otherwise indicated.
(3) Includes shares attributable to Ordinary Shares not outstanding but subject
to currently exercisable options, as follows: Mr. Campbell - 204,999
shares; Mr. Cawley - 47,000 shares; Mr. Chazen - 16,000 shares; Mr. Corbett
- 10,000 shares; Mr. Day - 355,833 shares; Mr. Leland - 40,000 shares; Mr.
Little - 22,500 shares; Mr. Sears - 29,500 shares; Mr. Jackson - 61,666
shares; Mr. Adkins - 178,666 shares; and Ms. Robertson - 237,999 shares.
(4) Includes 874,639 Ordinary Shares beneficially owned by The Samuel Roberts
Noble Foundation, Inc. Mr. Cawley, as President and Chief Executive Officer
and a trustee, and Mr. Day as a trustee, of the Foundation may be deemed to
beneficially own, and have voting and investment power with respect to, the
874,639 Ordinary Shares held by the Foundation. As one of the 13 members of
the board of trustees of the Foundation, neither Mr. Cawley nor Mr. Day
represents sufficient voting power on the Foundation's board of trustees to
determine voting or investment decisions with respect to the 874,639
Ordinary Shares. Mr. Cawley and Mr. Day each disclaim any pecuniary
interest in the 874,639 Ordinary Shares.
(5) Includes 1,204,163 Ordinary Shares not outstanding but subject to currently
exercisable options and 874,639 Ordinary Shares beneficially owned by the
Foundation. See footnotes (3) and (4) above.
EXECUTIVE SHARE OWNERSHIP
We encourage all of our executives to align their interests with our
members by making a personal investment in our Ordinary Shares. In 2000, we
adopted the minimum ownership guidelines set forth below for our executives. We
expect that each of our executives will meet these minimum guidelines within
five years of when the guidelines first apply to him or her.
7
OWNERSHIP GUIDELINES
(MULTIPLE OF BASE
PAY GRADE LEVEL SALARY)
--------------- --------------------
Pay Grade 37................................................................ 5.0 times
Pay Grades 34 through 36.................................................... 4.0 times
Pay Grades 31 through 33.................................................... 3.5 times
Pay Grades 28 through 30.................................................... 2.5 times
Pay Grades 27 through 28.................................................... 2.0 times
EXECUTIVE COMPENSATION
The following report of the compensation committee on executive
compensation and the information herein under "Executive
Compensation--Performance Graph" shall not be deemed to be "soliciting material"
or to be "filed" with the SEC or subject to the SEC's proxy rules, except for
the required disclosure herein, or to the liabilities of Section 18 of the
Securities Exchange Act of 1934 (the "Exchange Act"), and such information shall
not be deemed to be incorporated by reference into any filing made by the
Company under the Securities Act of 1933 or the Exchange Act.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
To the Members of
Noble Corporation:
The Compensation Committee (the "Committee") of the board of directors of
Noble Corporation ("Noble") is responsible for discharging the board of
directors' responsibilities relating to compensation of directors and executive
officers (including determining the compensation of the Chief Executive Officer
of Noble (the "CEO")), and for assisting the board of directors in reviewing and
administering compensation, benefits, and incentive and share-based compensation
plans, including the 1991 Stock Option Plan (the "1991 Plan").
The Committee has retained the services from time to time of Towers Perrin,
an independent management and compensation consulting firm, in making its
determinations and recommendations in regard to executive compensation matters.
The Committee uses compensation surveys and a comparison of how Noble's
compensation compares to compensation paid by its competitors to analyze the
reasonableness of Noble's compensation. Furthermore, company performance and the
individual performances of our executives are considered in making decisions on
executive compensation.
In January 2003, the Committee determined that it would be appropriate that
a compensation consulting firm other than Towers Perrin review Noble's
compensation programs and practices. In February 2003, the Committee retained
Deloitte & Touche LLP to conduct such a review. The Committee expects that
Deloitte & Touche LLP will present their findings to the entire Board in April
2003.
COMPENSATION PHILOSOPHY AND OBJECTIVES
Noble's executive compensation program reflects the philosophy that
compensation should be structured to closely align the executives' interests
with those of our members. The program is based on stock-based incentive and
performance-based pay programs. The compensation program is designed to attract,
motivate and retain quality persons who will continue to exemplify dedication to
Noble and its goals, thereby enhancing member (shareholder) value.
Base Salary
The Committee reviews base salaries for executive officers annually and
periodically adjusts salaries to reflect the competitive market and the
individuals' responsibilities, experience, leadership and contributions to our
success. The policy of the Committee is generally to set base salary levels at
approximately the median range for comparable positions determined from survey
information.
8
In October 2002, the Committee conducted its annual review of the base
salaries of the executive officers. At the request of senior management, no
salary adjustments for officers were made at that time.
Annual Incentives
Noble's Short Term Incentive Plan ("STIP") is a goal-driven plan that gives
participants, including executive officers, the opportunity to earn annual cash
bonuses if specified performance goals are achieved. A participant's target
bonus will range from 10% to 75% of the participant's base salary, depending on
salary classification. The CEO's target bonus is 75% of base salary. The STIP is
available to all full-time employees of Noble or its subsidiaries in salary
classifications 18 and higher who have completed one year of service at the
close of the plan year (December 31). The bonus earned by employees with less
than two years of service is prorated based on the number of full months served.
The Committee sets performance goals for the STIP for each year. Bonus
awards are calculated by multiplying the target bonus by a multiplier, which is
calculated by measuring actual performance against the performance goals set by
the Committee. Corporate or headquarters personnel and division personnel have
different performance goals. The Noble corporate employees (which includes the
CEO) performance goals for 2002 were total member/shareholder return and actual
net income as measured against budget. Division goals for 2002 were weighted
with respect to four criteria: safety results, optimizing operating performance,
net income and cash flow from operations.
Fifty percent of the bonus calculation for all employees is based on
achievement of the corporate performance goals. For each corporate employee, the
balance of the bonus calculation depends on the overall performance of all of
the divisions against the division goals. For each division employee, the
balance of the calculation depends on the performance of the employee's division
against its division goals.
Actual bonuses paid can range from zero to 150% of base salary for the CEO
or up to 110% of base salary for other participants.
Long-Term Incentive Compensation
Noble utilizes stock option grants and restricted stock awards under the
1991 Plan as a means of creating longer-term incentive for executive officers
and other employees. The 1991 Plan is designed to align a significant portion of
the executive compensation program with member interests by rewarding executives
for the attainment of stock price appreciation and total member/shareholder
return. The 1991 Plan, which was approved by stockholders at the Noble Drilling
Corporation 1991 annual meeting and amended with stockholder approval in 1994,
1997, 1999 and 2002, provides Noble with the flexibility of granting stock
options and awarding restricted stock. The options represent the right to
purchase Ordinary Shares over a period of up to 10 years upon the terms and
conditions as are specified by the 1991 Plan.
The Committee granted stock options under the 1991 Plan to executive
officers of Noble, including options to purchase 180,000 Ordinary Shares awarded
to the CEO, in July 2002. All of the options vest over three years and are
exercisable at $31.20, which was the fair market value of an Ordinary Share as
of the date of the grant. The Committee did not make any awards of restricted
stock during 2002.
2002 COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
The Committee reviews the CEO's salary once annually, consistent with
Noble's salary administration policy for all shore based employees. Adjustments
to the salary are considered by the Committee based upon Noble's financial and
share price performance and the achievement by Noble of certain business
objectives. The year 2002 was the second best year in Noble's history from a
financial performance standpoint. As evidenced in the performance graph
appearing in the proxy statement, which includes this report, Noble outperformed
its competitor peer group during 2002. However, at the request of the CEO, no
adjustment to the CEO's base salary was made in 2002. The CEO currently receives
23% of his base salary in the form of Ordinary Shares, as a result of the CEO's
request to have increases in the CEO's base salary made by the Committee in 2000
and 2001 paid in Ordinary Shares.
9
In accordance with the terms of the STIP, the CEO was awarded a bonus of
$813,750 relative to 2002 performance. In addition, the Committee awarded the
CEO a discretionary bonus of $100,000 for the CEO's contribution in connection
with Noble's financial and share price performance in 2002.
As noted above, in recognition of Noble's achievements during the latter
part of 2001 and the first half of 2002 under the leadership of the CEO, the
Committee granted the CEO an option to purchase 180,000 Ordinary Shares pursuant
to the 1991 Plan on July 25, 2002. In deciding to grant these options, the
Committee also considered compensation data provided by Towers Perrin.
In the December 2002 issue of Chief Executive, a national business
publication, Mr. Day was recognized for achieving the fourth highest shareholder
value return in the energy industry over his tenure as CEO, which began in 1984.
In the January 2003 issue of Institutional Investor magazine, Mr. Day was
recognized as the best chief executive officer in the oil services and equipment
industry segment, as ranked by portfolio managers and securities analysts at
major money management firms and investment banks.
TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION
Section 162(m) of the Internal Revenue Code of 1986, as amended, generally
limits the tax deductibility to public companies for compensation in excess of
$1 million per person per year, unless such compensation meets certain specific
requirements. The Committee's intent is to structure compensation awards that
will be deductible without limitation where doing so will further the purposes
of Noble's executive compensation programs. The Committee also considers it
important to retain flexibility to design compensation programs, even where
compensation payable under such programs may not be fully deductible, if such
programs effectively recognize a full range of criteria important to Noble's
success and result in a gain to Noble that would outweigh the limited negative
tax effect.
SUMMARY
The members of the Committee believe that linking executive compensation to
corporate performance results in a better alignment of compensation with
corporate goals and member interests. As performance goals are met or exceeded
and the value of our member's investment in Noble increases, we believe that
executive officers are to be rewarded commensurately. The members of the
Committee believe that compensation levels during 2002 adequately reflect the
compensation goals and policies of Noble.
March 10, 2003 COMPENSATION COMMITTEE
Michael A. Cawley, Chairman
Luke R. Corbett
Marc E. Leland
10
The following table shows the compensation of our Chief Executive Officer
and our four other most highly paid executive officers (collectively, the "named
executive officers"). See the Report of the Compensation Committee beginning on
page 8 of this proxy statement for an explanation of our compensation policies
and programs.
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION AWARDS
------------------------------------
ANNUAL COMPENSATION
-------------------------------
VALUE OF
SECURITIES LONG
OTHER UNDERLYING TERM ALL
ANNUAL RESTRICTED OPTIONS INCENTIVE OTHER
NAME AND COMPEN- STOCK (NUMBER OF PLAN PAY- COMPEN-
PRINCIPAL POSITION YEAR SALARY BONUS SATION AWARDS SHARES)(1) OUTS SATION
------------------ ---- --------- ---------- -------- ---------- ---------- ------------ -----------
James C. Day................. 2002 $ 775,000 $ 913,750 $ 7,855 $ -- 180,000 $ 2,274,211 $15,374 (2)
Chairman and CEO 2001 $ 733,334 $ 435,938 $ 7,855 $2,425,200 125,000 $ 2,512,290 $14,682
2000 $ 620,833 $1,087,500 $ 7,491 $3,617,600 125,000 $ 2,287,984 $13,297
Robert D. Campbell........... 2002 $ 385,000 $ 350,000 $ 0 $ -- 85,000 $ 852,240 $ 9,601 (2)
President 2001 $ 372,500 $ 200,000 $ 0 $ 747,875 65,000 $ 738,030 $ 8,329
2000 $ 345,000 $ 407,000 $ 0 $1,276,800 65,000 $ 565,000 $11,315
Mark A. Jackson.............. 2002 $ 310,000 $ 280,000 $ 0 $ -- 75,000 $ 253,840 $ 8,400 (3)(4)
Senior Vice 2001 $ 301,667 $ 125,000 $ 0 $ 454,725 35,000 $ 134,900 $ 7,140
President - Finance, Chief 2000 $ 100,000 $ 125,000 $ 0 $1,225,000 75,000 $ 0 $ 8,942
Financial Officer
Danny W. Adkins.............. 2002 $ 255,000 $ 280,000 $ 0 $ -- 75,000 $ 752,985 $ 8,400 (3)(5)
Senior Vice President - 2001 $ 242,500 $ 135,000 $ 0 $ 606,300 55,000 $ 755,010 $ 7,536
Operations 2000 $ 215,000 $ 216,000 $ 0 $1,064,000 55,000 $ 575,291 $ 8,942
Julie J. Robertson........... 2002 $ 250,000 $ 280,000 $ 0 $ -- 75,000 $ 682,933 $11,000 (3)
Senior Vice President - 2001 $ 224,167 $ 135,000 $ 0 $ 606,300 50,000 $ 681,570 $10,203
Administration and 2000 $ 176,667 $ 189,000 $ 0 $1,064,000 50,600 $ 545,598 $10,072
Corporate Secretary
----------
(1) Options represent the right to purchase Ordinary Shares at a fixed price
per share.
(2) Consists of company contributions to defined contribution plan (and
unfunded, nonqualified excess benefit plan), term life insurance premiums
and directors' fees, respectively, as follows: Mr. Day - $11,000, $3,774
and $600; and Mr. Campbell - $8,400, $601 and $600.
(3) Consists of company contributions to defined contribution plan (and
unfunded, nonqualified excess benefit plan) as follows: Mr. Jackson -
$8,400; Mr. Adkins - $8,400; and Ms. Robertson - $11,000.
(4) Mr. Jackson was elected Senior Vice President - Finance and Chief Financial
Officer on September 1, 2000.
(5) Mr. Adkins became an executive officer in February 2001.
11
The following table sets forth certain information with respect to options
to purchase Ordinary Shares granted during the year ended December 31, 2002 to
each of the named executive officers.
OPTION/SAR GRANTS IN 2002
INDIVIDUAL GRANTS
----------------------------------------------------------
NUMBER OF
SECURITIES PERCENT OF POTENTIAL REALIZABLE VALUE AT
UNDERLYING TOTAL ASSUMED ANNUAL RATES OF STOCK
OPTIONS OPTIONS EXERCISE PRICE APPRECIATION FOR
GRANTED GRANTED TO PRICE OPTION TERM (1)
(NUMBER OF EMPLOYEES PER -------------------------------
NAME SHARES) IN 2002 SHARE EXPIRATION DATE 5% (3) 10% (4)
--------------------- ----------- ----------- ----------- --------------- --------------- --------------
James C. Day......... 180,000 (2) 10.94% $ 31.20 July 24, 2012 $ 3,531,600 $ 8,949,600
Robert D. Campbell... 85,000 (2) 5.17% $ 31.20 July 24, 2012 $ 1,667,700 $ 4,226,200
Mark A. Jackson...... 75,000 (2) 4.56% $ 31.20 July 24, 2012 $ 1,471,500 $ 3,729,000
Danny W. Adkins...... 75,000 (2) 4.56% $ 31.20 July 24, 2012 $ 1,471,500 $ 3,729,000
Julie J. Robertson... 75,000 (2) 4.56% $ 31.20 July 24, 2012 $ 1,471,500 $ 3,729,000
----------------
(1) The values shown are based on the indicated assumed annual rates of
appreciation compounded annually. Actual gains realized, if any, on stock
option exercises and Ordinary Share holdings are dependent on the future
performance of the Ordinary Shares and overall stock market conditions.
There can be no assurance that the values shown in this table will be
achieved.
(2) Amounts represent a single grant of options on July 25, 2002. One-third of
the options becomes exercisable on each of July 25, 2003, 2004 and 2005.
(3) Reflects an assumed market price per Ordinary Share of $50.82.
(4) Reflects an assumed market price per Ordinary Share of $80.92.
The following table sets forth certain information with respect to the
exercise of options to purchase Ordinary Shares and stock appreciation rights
(SARs) during the year ended December 31, 2002, and the unexercised options held
at December 31, 2002 and the value thereof, by each of the named executive
officers.
AGGREGATED OPTION/SAR EXERCISES IN 2002
AND 12/31/02 OPTION/SAR VALUES
SHARES NUMBER OF SECURITIES VALUE OF UNEXERCISED IN-THE-
ACQUIRED UNDERLYING OPTIONS/SARS AT MONEY OPTIONS/SARS AT
ON EXERCISE 12/31/02 (SHARES) 12/31/02
(NUMBER OF VALUE -----------------------------------------------------------
NAME SHARES) REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ------------ ------------- -------------- ---------------
James C. Day............ 106,333 $ 2,537,693 355,833 315,001 $ 2,251,144 $ 1,183,753
Robert D. Campbell...... -- -- 204,999 150,001 2,675,397 511,253
Mark A. Jackson......... -- -- 61,666 123,334 47,247 390,753
Danny W. Adkins......... -- -- 178,666 134,001 1,855,187 498,851
Julie J. Robertson...... -- -- 237,999 129,001 2,539,517 485,353
DEFINED BENEFIT PLANS
Our defined benefit plans that cover our executive officers provide the
benefits shown below. The estimates assume that benefits are received in the
form of 10-year certain and life annuity.
12
PENSION PLAN TABLE
ESTIMATED ANNUAL BENEFITS UPON RETIREMENT AT AGE 65
FIVE-YEAR AVERAGE AFTER COMPLETION OF THE FOLLOWING YEARS OF SERVICE (2)
ANNUAL ---------------------------------------------------------------
COMPENSATION (1) 15 20 25 30
---------------- -------------- -------------- -------------- -------------
$ 125,000....................................... $ 30,000 $ 40,000 $ 50,000 $ 60,000
200,000....................................... 48,000 64,000 80,000 96,000
300,000....................................... 72,000 96,000 120,000 144,000
400,000....................................... 96,000 128,000 160,000 192,000
600,000....................................... 144,000 192,000 240,000 288,000
800,000....................................... 192,000 256,000 320,000 384,000
1,000,000....................................... 240,000 320,000 400,000 480,000
1,400,000....................................... 336,000 448,000 560,000 672,000
1,800,000....................................... 432,000 576,000 720,000 864,000
----------
(1) Benefit amounts under the Noble Drilling Salaried Employees' Retirement
Plan (and unfunded, nonqualified excess benefit plan) are based on an
employee's vested percentage, average monthly compensation and number of
years of benefit service (maximum 30 years). The average monthly
compensation is defined in the plan generally to mean the participant's
average monthly rate of compensation from the Company for the five
successive calendar years that give the highest average monthly rate of
compensation for the participant. Plan compensation is defined (with
certain exceptions) to mean basic compensation, bonuses, commissions and
overtime pay, exclusive of extraordinary compensation but prior to
reduction for any compensation deferred under a cash or deferred
arrangement qualifying under Sections 401(k) or 125 of the Internal Revenue
Code of 1986, as amended. Accordingly, the amounts reported in the Summary
Compensation Table included elsewhere herein under the table caption
"Annual Compensation" approximate plan compensation for 2002.
(2) Retirement benefits shown above are calculated using 1.6 percent of final
average pay multiplied by years of service. This slightly overstates the
benefit since that part of the final average pay that is below the Social
Security "covered compensation" level should be multiplied by 1.0 percent
instead of 1.6 percent. "Covered compensation" is the average of the Social
Security Wage Bases during the 35-year period ending with the year the
employee reaches Social Security Retirement Age. The amount of benefit
shown is not subject to deductions for Social Security.
As of December 31, 2002, the named executive officers had the following
approximate credited years of service for retirement purposes: Mr. Day--25; Mr.
Campbell--4; Mr. Jackson--2; Mr. Adkins--8; and Ms. Robertson--14.
The following table sets forth information regarding securities authorized
for issuance under our equity compensation plans as of December 31, 2002.
EQUITY COMPENSATION PLAN INFORMATION
NUMBER OF SECURITIES
NUMBER OF SECURITIES REMAINING AVAILABLE FOR
TO BE ISSUED UPON WEIGHTED-AVERAGE FUTURE ISSUANCE UNDER
EXERCISE OF EXERCISE PRICE OF EQUITY COMPENSATION PLANS
OUTSTANDING OPTIONS, OUTSTANDING OPTIONS, (EXCLUDING SECURITIES
PLAN CATEGORY WARRANTS AND RIGHTS WARRANTS AND RIGHTS REFLECTED IN COLUMN (a))
------------- ---------------------- ---------------------- ---------------------------
(a) (b) (c)
Equity compensation plans
Approved by security holders........ 9,187,658 $29.64 4,271,973
Equity compensation plans not
Approved by security holders........ N/A N/A 236,205 (1)
Total................................... 9,187,658 $29.64 4,508,178
----------
(1) Consists of shares issuable under the Noble Drilling Corporation 401(k)
Savings Restoration Plan and the Noble Corporation Equity Compensation Plan
for Non-Employee Directors. The Restoration Plan was amended in February
2003 to limit the total number of shares issuable under the Restoration
Plan since its inception to 200,000. Prior to that amendment, there was no
such limit. The number of shares in column (c) gives effect to the
amendment.
13
Set forth below is a brief description of the material features of the
equity compensation plans of the Company that have not been approved by members
and for which information is included in the table above.
Noble Drilling Corporation 401(k) Savings Restoration Plan. The Noble
Drilling Corporation 401(k) Savings Restoration Plan is a nonqualified,
unfunded employee benefit plan under which certain highly compensated
employees of the Company may elect to defer compensation in excess of
amounts deferrable under the Company's 401(k) Plan, and receive employer
matching contributions (which are made in Ordinary Shares). The employer
matching amount is limited in the same manner as are employer matching
contributions under the Noble Drilling Corporation 401(k) Savings Plan. At
the discretion of the Company, eligible participants may also receive
direct payment of compensation through Ordinary Shares as additional awards
under this plan. Mr. Day's salary increases awarded in 2000 and 2001 are
currently paid in Ordinary Shares pursuant to this feature of the plan.
Effective February 25, 2003, the plan was amended to limit the total number
of Ordinary Shares issuable under the plan since its inception to 200,000.
No options are issuable under the plan, and there is no "exercise price"
applicable to shares delivered under the plan.
Noble Corporation Equity Compensation Plan for Non-Employee Directors.
Under this plan, non-employee directors of the Company receive one-fifth
($7,000) of their annual retainer ($35,000) in Ordinary Shares. In
addition, non-employee directors may elect to receive up to all of the
balance of their annual retainer in Ordinary Shares or cash under the plan.
Non-employee directors make elections on a quarterly basis. The number of
Ordinary Shares to be issued under the plan in any particular quarter is
determined using the average closing sales price of Ordinary Shares for the
last 15 trading days of the previous quarter. No options are issuable under
the plan, and there is no "exercise price" applicable to shares delivered
under the plan.
PERFORMANCE GRAPH
The following graph sets forth the cumulative total member (shareholder)
return for the Ordinary Shares of the Company, the NYSE Stock Market Index (U.S.
Companies), and a Competitor Group Index for the years indicated as prescribed
by the SEC's rules. In accordance with the SEC's rules, we have elected to
select a group of peer companies on an industry basis for comparison purposes.
The competitor group is composed of seven industry participants: Atwood
Oceanics, Inc., Diamond Offshore Drilling, Inc., ENSCO International
Incorporated, GlobalSantaFe Corporation, Pride International, Inc., Rowan
Companies, Inc. and Transocean Inc. Total return calculations were weighted
according to the respective company's market capitalization.
14
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURNS
AMONG NOBLE CORPORATION, NYSE STOCK MARKET INDEX (U.S. COMPANIES)
AND SEVEN-MEMBER COMPETITOR GROUP INDEX
(PERFORMANCE GRAPH)
SYMBOL 12/31/97 12/31/98 12/31/99 12/29/00 12/31/01 12/31/02
------ -------- -------- -------- -------- -------- --------
Noble Corporation 100.0 42.2 106.9 141.8 111.2 114.8
NYSE Stock Market 100.0 119.9 131.2 136.4 126.1 103.6
Competitor Group 100.0 41.9 67.5 91.7 68.2 57.7
NOTES:
A. The lines represent monthly index levels derived form compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a trading
day, the preceding trading day is used.
D. The index level for all series was set to $100 on 12/31/1997.
15
SUPPLEMENTAL PERFORMANCE GRAPH
The Company has elected to include a supplemental performance graph, which
compares the cumulative total member (shareholder) return for the Ordinary
Shares, the NYSE Stock Market Index (U.S. Companies) and a Competitor Group
Index for the period indicated below. In accordance with the SEC's rules, we
have elected to select a group of peer companies on an industry basis for
comparison purposes. The competitor group is composed of seven industry
participants: Atwood Oceanics, Inc., Diamond Offshore Drilling, Inc., ENSCO
International Incorporated, GlobalSantaFe Corporation, Pride International,
Inc., Rowan Companies, Inc. and Transocean Inc. Total return calculations were
weighted according to the respective company's market capitalization.
COMPARISON OF SEVENTEEN-YEAR CUMULATIVE TOTAL RETURNS
AMONG NOBLE CORPORATION, NYSE STOCK MARKET INDEX (U.S. COMPANIES)
AND SEVEN-MEMBER COMPETITOR GROUP INDEX
(PERFORMANCE GRAPH)
SYMBOL 12/31/85 12/31/86 12/31/87 12/30/88 12/29/89 12/31/90 12/31/91 12/31/92 12/31/93
------ -------- -------- -------- -------- -------- -------- -------- -------- --------
Noble Corporation 100.0 91.3 139.1 169.6 321.7 252.2 108.7 154.3 304.3
NYSE Stock Market 100.0 117.9 121.0 142.3 184.4 176.1 231.3 251.6 277.9
Competitor Group 100.0 55.6 77.9 69.9 127.5 112.3 64.3 60.4 99.3
SYMBOL 12/30/94 12/29/95 12/31/96 12/31/97 12/31/98 12/31/99 12/29/00 12/31/01 12/31/02
------ -------- -------- -------- -------- -------- -------- -------- -------- --------
Noble Corporation 204.3 313.0 691.3 1065.2 450.0 1139.1 1510.9 1184.0 1222.6
NYSE Stock Market 277.9 376.6 456.5 606.7 727.1 796.3 827.5 765.1 628.4
Competitor Group 86.2 190.0 375.5 534.4 202.3 342.6 486.9 347.2 293.5
NOTES:
A. The lines represent annual index levels derived form compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the annual interval, based on the fiscal year-end, is not a trading day,
the preceding trading day is used.
D. The index level for all series was set to $100 on 12/31/1985. The Company
became a publicly held corporation in October 1985.
16
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our directors
and officers, and persons who own more than 10 percent of our Ordinary Shares,
to file with the SEC initial reports of ownership and reports of changes in
ownership of such shares. Directors, officers and beneficial owners of more than
10% of our Ordinary Shares are required by SEC regulations to furnish us with
copies of all Section 16(a) forms they file.
On August 27, 2002, the SEC adopted new rules accelerating the timing of
when reports under Section 16(a) must be filed with the SEC. The following
filings were not made in a timely manner under the new Section 16(a) filing
schedule: (1) Mr. Adkins, Mr. Jackson and Ms. Robertson each filed late Form 4s,
regarding 28 Ordinary Shares, 25 Ordinary Shares and 39 Ordinary Shares,
respectively, for Ordinary Shares deposited in each person's 401(k) Restoration
Plan account (shares represented the employer match) on September 25, 2002; (2)
Mr. Day filed a late Form 4 regarding 481 Ordinary Shares deposited into his
Restoration Plan account on September 25, 2002; and (3) Mr. Adkins filed a late
Form 4 regarding 267 Ordinary Shares deposited into his Restoration Plan account
on October 1, 2002. All of the reports were filed with the SEC by October 7,
2002. To our knowledge, based solely on a review of the copies of such reports
furnished to us and written representations that no other reports were required,
during the year ended December 31, 2002, our directors, officers and beneficial
owners of more than 10% of our Ordinary Shares otherwise complied with all
applicable Section 16(a) filing requirements in a timely manner. We have
instituted new procedures to assist our officers and directors in complying with
the accelerated filing requirements under Section 16(a) on a going forward
basis.
AUDITORS
The audit committee of our board of directors has appointed
PricewaterhouseCoopers LLP, which has audited our financial statements since
1994, to audit our financial statements for the year ending December 31, 2003.
We will not submit this appointment to members for ratification or approval.
Representatives of PricewaterhouseCoopers LLP are expected to be present at the
annual general meeting to respond to appropriate questions from members, and
will be given the opportunity to make a statement should they desire to do so.
REPORT OF THE AUDIT COMMITTEE
To the Members of
Noble Corporation:
The board of directors of Noble Corporation ("Noble") maintains an audit
committee comprising three outside directors. The board of directors and the
audit committee believe that the audit committee's current member composition
satisfies the rules of the New York Stock Exchange in effect on the date of this
report that govern audit committee composition, including the requirement that
audit committee members all be "independent" as that term is defined in Section
303.01(B)(2)(a) and (3) of the NYSE's listing standards.
The audit committee oversees Noble's financial process on behalf of the
entire board of directors. Management has the primary responsibility for Noble's
financial statements and the reporting process, including the systems of
internal controls. The primary responsibilities of the audit committee are to
review with Noble's auditors the company's financial reports (and other
financial information) provided to the SEC and the investing public and to
assist the board of directors with oversight of the integrity of the company's
financial statements, compliance with Noble's business ethics and legal and
regulatory requirements, the qualification and independence of Noble's
independent auditors and the performance of independent and internal auditors.
In fulfilling its oversight responsibilities, the audit committee reviewed and
discussed the audited financial statements with management.
The audit committee reviewed and discussed with the independent auditors
all communications required by generally accepted auditing standards, including
those described in Statement on Auditing Standards No. 61. In addition, the
audit committee has discussed with Noble's independent auditors the auditors'
independence from management and Noble, including the matters in the written
disclosures below and the letter from the independent auditors required by the
Independence Standards Board, Standard No. 1.
The audit committee discussed with the independent auditors the overall
scope and plans for their audit. The audit committee meets with the independent
auditors, with and without management present, to discuss the results of
17
their examination, their evaluation of Noble's internal controls and the overall
quality of Noble's financial reporting. The audit committee held four meetings
during 2002 and met again on January 30, 2003.
AUDIT FEES
The aggregate fees billed for professional services rendered by
PricewaterhouseCoopers LLP for the audit of Noble's annual financial statements
for the fiscal year ended December 31, 2002 and the reviews of the financial
statements included in Noble's Quarterly Reports on Form 10-Q for 2002 fiscal
year (collectively, the "Audit Services") were $814,800.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
PricewaterhouseCoopers LLP did not render any professional services
described in Paragraph (c) (4) (ii) of Rule 2-01 of Regulations S-X (17 CFR
210.2-01) during the year ended December 31, 2002.
ALL OTHER FEES
The aggregate fees billed for all other services (the "Other Services")
rendered to Noble by PricewaterhouseCoopers LLP during the fiscal year ended
December 31, 2002, other than the Audit Services, were $1,919,588. The Other
Services consisted of tax compliance and advisory services totaling $1,142,199,
internal audit services totaling $306,262, employee benefit plan audit services
totaling $44,000, and other services totaling $427,127.
SUMMARY
In reliance on the reviews and discussions referred to above, the audit
committee recommended to the board of directors (and the Board has approved)
that the audited financial statements be included in Noble's Annual Report on
Form 10-K for the year ended December 31, 2002 for filing with the SEC. The
audit committee also determined that the provision of the Other Services
rendered by PricewaterhouseCoopers LLP was compatible with maintaining
PricewaterhouseCoopers LLP's independence.
March 10, 2003 AUDIT COMMITTEE
Jack E. Little, Chairman
Lawrence J. Chazen
William A. Sears
MEMBER PROPOSALS AND OTHER MATTERS
MEMBER PROPOSALS
Any proposal by a member intended to be presented at the 2004 Annual
General Meeting of Members, must be received by the Company at our principal
executive offices at 13135 South Dairy Ashford, Suite 800, Sugar Land, Texas
77478, Attn: Julie J. Robertson, Senior Vice President - Administration and
Secretary, no later that November 16, 2003, for inclusion in the proxy materials
relating to that meeting.
The Company's articles of association provide that all member nominations
for nominees for election to the board of directors must be made following
written notice to our corporate secretary accompanied by certain background and
other information specified in the articles of association. In connection with
any annual general meeting, written notice of a member's intention to make such
nominations must be given to our corporate secretary not later than the date
which is 90 days in advance of the annual general meeting.
In order for a member to bring other business before an annual general
meeting of members, timely notice must be received by our corporate secretary
not less than 60 nor more than 120 days in advance of the meeting. The notice
must include a description of the proposed item, the reasons the member believes
support its position
18
concerning the item, and other specified matters. These requirements are
separate from and in addition to the requirements you must meet to have a
proposal included in our proxy statement. The foregoing time limits also apply
in determining whether notice is timely for purposes of rules adopted by the SEC
relating to the exercise of discretionary voting authority.
SOLICITATION OF PROXIES
The cost of the solicitation of proxies, including the cost of preparing,
printing and mailing the materials used in the solicitation, will be borne by
the Company. The Company has retained Georgeson Shareholder Communications Inc.
to aid in the solicitation of proxies for a fee of $10,000 and the reimbursement
of out-of-pocket expenses. Proxies may also be solicited by personal interview,
telephone and telegram and via the Internet by directors, officers and employees
of the Company, who will not receive additional compensation for those services.
Arrangements also may be made with brokerage houses and other custodians,
nominees and fiduciaries for the forwarding of solicitation materials to the
beneficial owners of Ordinary Shares held by those persons and the Company will
reimburse them for reasonable expenses incurred by them in connection with the
forwarding of solicitation materials.
ADDITIONAL INFORMATION ABOUT THE COMPANY
You can learn more about our operations and the Company by visiting our
website at www.noblecorp.com. Among other information we have provided there,
you will find:
o Our business conduct/business ethics policies
o Our articles and memorandum of association
o Information concerning our business and recent press releases and
filings with the SEC
o Information concerning our board of directors and member relations
If you would like to contact a member of our board of directors, please
send an e-mail to nobleboard@noblecorp.com.
For additional information about the Company, please refer to our 2002
Annual Report, which is being mailed with this proxy statement.
NOBLE CORPORATION
James C. Day
Chairman and
Chief Executive Officer
Sugar Land, Texas
March 14, 2003
19
THERE ARE THREE WAYS TO DELIVER YOUR VOTING INSTRUCTIONS
TELEPHONE INTERNET MAIL
This method is available for Visit the Internet website at Simply complete, sign and date
residents of the U.S. and HTTP://PROXY.GEORGESON.COM. your Voting Instruction Card and
Canada. On a touch tone Enter the COMPANY NUMBER return it in the postage-paid
telephone, call TOLL FREE AND CONTROL NUMBER envelope. If you are providing
1-800-850-5909, 24 hours a shown below and follow instructions by telephone or the
day, 7 days a week. You will be the instructions on your Internet, please do not mail
asked to enter ONLY the screen. You will incur only your your Voting Instruction Card.
CONTROL NUMBER shown usual internet charges. Available
below. Have your Voting until 5 p.m. Eastern Time on
Instruction Card ready, then Wednesday, April 23, 2003.
follow the prerecorded
instructions. Available until
5 p.m. Eastern Time on
Wednesday, April 23, 2003.
----------------------- -----------------------
COMPANY NUMBER CONTROL NUMBER
----------------------- -----------------------
TO DELIVER YOUR INSTRUCTIONS BY MAIL, PLEASE DETACH VOTING INSTRUCTION CARD HERE
--------------------------------------------------------------------------------
PLEASE MARK
[X] VOTES AS IN
THIS EXAMPLE.
FOR both nominees WITHHOLD
listed below (except AUTHORITY to vote
as marked to the for both nominees
contrary below as listed below
Item 1. Election of Directors. THE BOARD OF DIRECTORS
RECOMMENDS A VOTE "FOR" THE ELECTION OF [ ] [ ]
THE NOMINEES LISTED BELOW.
JAMES C. DAY
MARC E. LELAND
(INSTRUCTION: To withhold authority to vote for any individual
nominee, write the nominee's name in the space provided below.)
---------------------------------------------------------------
Change of address and/or Comments Mark Here? [ ]
Dated: , 2003
------------------------------------
------------------------------------------------
Signature(s) of 401(k) Plan Participant
This voting instruction card should be signed
exactly as your name appears hereon.
Voting instructions must be indicated [x] in
black or blue ink.
Please complete, date and sign this voting instruction card and return it
promptly in the enclosed postage prepaid envelope.
PLEASE DETACH PROXY CARD HERE
--------------------------------------------------------------------------------
NOBLE CORPORATION
13135 SOUTH DAIRY ASHFORD, SUITE 800
SUGAR LAND, TEXAS 77478
VOTING INSTRUCTION CARD FOR ORDINARY SHARES
VOTING INSTRUCTIONS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby instructs the trustee to vote, as designated
below, all Ordinary Shares of Noble Corporation that are credited to the
accounts of the undersigned (whether or not vested) in the Noble Drilling
Corporation 401(k) Savings Plan at the Annual General Meeting of Members of
Noble Corporation to be held on April 24, 2003, and at any adjournment thereof,
as more fully described in the notice of the Meeting and the proxy statement
accompanying the same, receipt of which is hereby acknowledged.
THIS VOTING INSTRUCTION CARD, WHEN DULY EXECUTED AND RETURNED, WILL BE VOTED BY
THE TRUSTEE OF THE NOBLE DRILLING CORPORATION 401(k) SAVINGS PLAN ("401(k)
PLAN") IN THE MANNER DESIGNATED HEREIN BY THE UNDERSIGNED 401(k) PLAN
PARTICIPANT. IF THIS VOTING INSTRUCTION CARD IS DULY EXECUTED AND RETURNED, BUT
WITHOUT A CLEAR VOTING DESIGNATION, IT WILL BE VOTED FOR APPROVAL OF ITEM 1.
(Continued and to be signed and dated on the reverse side)
----------------
SEE REVERSE SIDE
----------------
THERE ARE THREE WAYS TO DELIVER YOUR PROXY
TELEPHONE INTERNET MAIL
This method is available Visit the Internet website at Simply complete, sign and
for residents of the U.S. http://proxy.georgeson.com. date your Proxy Card and
and Canada. On a touch Enter the COMPANY NUMBER return it in the
tone telephone, call TOLL and CONTROL NUMBER shown postage-paid envelope. If
FREE 1-800-850-5909, 24 below and follow the you are voting by
hours a day, 7 days a instructions on your telephone or the Internet,
week.You will be asked to screen. You will incur please do not mail your
enter ONLY the CONTROL only your usual internet Proxy Card.
NUMBER shown below. Have charges.Available until 5
your Proxy Card ready, p.m. Eastern Time on
then follow the Wednesday, April 23, 2003.
prerecorded instructions.
Available until 5 p.m.
Eastern Time on Wednesday,
April 23, 2003.
-------------------- --------------------
COMPANY NUMBER CONTROL NUMBER
-------------------- --------------------
TO DELIVER YOUR PROXY BY MAIL, PLEASE DETACH PROXY CARD HERE
--------------------------------------------------------------------------------
PLEASE MARK
[X] VOTES AS IN
THIS EXAMPLE.
FOR both nominees WITHHOLD
listed below (except AUTHORITY to vote
as marked to the for both nominees
Item 1. Election of Directors. THE BOARD OF DIRECTORS contrary below as listed below
RECOMMENDS A VOTE "FOR" THE ELECTION OF [ ] [ ]
THE NOMINEES LISTED BELOW.
JAMES C. DAY
MARC E. LELAND
(INSTRUCTION: To withhold authority to vote for any individual
nominee, write the nominee's name in the space provided below.) IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO
VOTE UPON SUCH OTHER MATTERS AS MAY PROPERLY
-------------------------------------------------------------- COME BEFORE THE MEETING.
Change of address and/or Comments Mark Here ? [ ]
Date: , 2003
------------------------------------------
------------------------------------------------------
Signature
------------------------------------------------------
Signature
Sign exactly as name appears hereon. (If shares are
held by joint tenants, both should sign. If signing as
Attorney, Executor, Administrator, Trustee or Guardian,
please give your title as such. If the signer is a
corporation, please sign in the full corporate name by
duly authorized officer.) Votes must be indicated [X]
in Black or Blue Ink.
(Please sign, date and return this proxy promptly in the enclosed postage prepaid envelope.)
PLEASE DETACH PROXY CARD HERE
--------------------------------------------------------------------------------
NOBLE CORPORATION
13135 SOUTH DAIRY ASHFORD,SUITE 800
SUGAR LAND,TEXAS 77478
PROXY
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned, revoking any proxy heretofore given with the Meeting
of Members described below, hereby appoints James C. Day proxy, with full powers
of substitution, to represent the under- signed at the Annual General Meeting of
Members of Noble Corporation to be held on April 24, 2003, and at any
adjournment thereof, and to vote all shares that the undersigned would be
entitled to vote if personally present as follows:
The shares represented by this proxy will be voted as directed herein.
IF THIS PROXY IS DULY EXECUTED AND RETURNED, AND NO VOTING DIRECTIONS ARE GIVEN
HEREIN, SUCH SHARES WILL BE VOTED "FOR" APPROVAL OF ITEM 1. The undersigned
hereby acknowledges receipt of notice of, and the proxy statement for, the
aforesaid Annual General Meeting.
PROXY
(Continued and to be signed and dated on the reverse side)
------------------
SEE REVERSE SIDE
------------------