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On March 19, 2007, the following presentation was made to analysts:

 

2


March 19, 2007
Hercules Offshore Acquisition of TODCO


1
Forward-looking Statements
This presentation will contain "forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended.  These statements, which include any statement that does not relate strictly to historical
facts, use terms such as “anticipate,”
“assume,”
“believe,”
“estimate,”
“expect,”
“forecast,”
“intend,”
“plan,”
“position,”
“predict,”
“project,”
or “strategy”
or the negative connotation or other variations of
such terms or other similar terminology.  In particular, statements, express or implied, regarding future
results of operations or ability to generate revenues, income or
cash flow or to make acquisitions are
forward-looking statements.  These forward-looking statements are based on management’s current
plans, expectations, estimates, assumptions and beliefs concerning future events impacting Hercules
Offshore, Inc. (“Hercules”) and therefore involve a number of risks and uncertainties, many of which
are beyond management’s control. These risks and uncertainties are further described in Hercules’
annual report on Form 10-K and its most recent periodic reports and other documents filed
with the
Securities and Exchange Commission which are available free of charge at the SEC’s website at
www.sec.gov
or
the
company’s
website
at
www.herculesoffshore.com.
The
forward-looking
statements
involve
risks
and
uncertainties
that
affect
Hercules’
operations and
financial
performance.
All
forward-looking
statements
attributable
to
Hercules’
representatives are
expressly qualified in their entirety by this cautionary statement.


2
A Winning Combination
A Gulf of Mexico leader. . . with global reach
A Leader in Liftboats
A Leader in Barge Drilling
A New Leader in Jackup Drilling


3
Management Representatives
Representatives
Randall Stilley
Chief Executive Officer and President
John Rynd
Senior Vice President
Lisa Rodriguez
Senior Vice President and Chief Financial Officer
David Crowley
Senior Vice President of Operations (TODCO)
Stephen Butz
Vice President and Treasurer


4
Transaction Highlights
Consideration to TODCO shareholders
Average per share
0.979 Hercules shares
$16.00 per share in cash
Cash or stock election feature (subject to
proration)
Acquisition funded with existing cash on hand
and a senior secured term loan facility
Closing expected mid-2007
Subject to:
HSR approval
Hercules and TODCO shareholder votes
Post-transaction Board of Directors to include
seven Hercules and three TODCO nominees


5
Creates Shareholder Value in Near and Long-term
Accretive to earnings and cash flow per share
Opportunity to enhance future returns with lower cost of capital
Potential for multiple expansion due to size and growth prospects
Pro forma 2006 revenue and EBITDA of $1.3 billion and $551 million,
respectively
Revenue
(1)
($mm)
EBITDA
(1)
($mm)
(1)
PF Hero represents Hercules plus TODCO financials per 2006 10K filings, no accounting adjustments have been made.
$344
$1,256
0.0
500.0
1,000.0
1,500.0
HERO
PF HERO
$190
$551
0.0
250.0
500.0
750.0
HERO
PF HERO


6
Acquisition-related debt allows Hercules to optimize its capital structure
Enhanced credit quality due to increased scale and scope
Term loan provides flexibility for rapid de-leveraging with significant
expected free cash flow
Successful track record of de-leveraging following acquisitions
Pro Forma Capital Structure as of 12/31/06
Total Debt/Total Capitalization
Total Debt as a Multiple of LTM EBITDA
2.0x
2.0x
1.8x
1.7x
1.0x
0.8x
0.6x
0.5x
0.0x
0.5x
1.0x
1.5x
2.0x
2.5x
PF
HERO
RIG
PDE
SPN
RDC
DO
NE
GSF
50%
37%
35%
33%
29%
23%
18%
12%
0.0%
20.0%
40.0%
60.0%
SPN
PF
HERO
PDE
RIG
DO
RDC
NE
GSF


7
Summary of Strategic Rationale
Enhances position in Gulf of Mexico and increases
operational flexibility
Provides asset and geographic diversity
Expands international footprint for future growth
Creates larger, more diverse jackup fleet
Timely combination in a fragmented jackup market
Combines leaders in barge drilling and liftboats
Potential to realize meaningful synergies
Economies of scale
Procurement of materials, insurance, employee benefits
Operational synergies and redundant public company
expenses


8
Provides Asset Diversity
2006 Revenue Segmentation Analysis
Pre-Transaction
$344 MM
Post-Transaction
$1,256 MM
GOM Contract
Drilling
47%
International
Liftboats
6%
Domestic
Liftboats
39%
International
Contract Drilling
9%
Domestic
Liftboats
11%
International
Contract Drilling
17%
Inland Barge
Drilling
19%
International
Liftboats
2%
GOM Contract
Drilling
46%
Delta Towing
6%


9
2006 Geographic Revenue Analysis
Provides Geographic Diversity
Pre-Transaction
$344 MM
Post-Transaction
$1,256 MM
We expect international contribution to represent a greater portion of our
revenues in the future
US GOM
86%
West Africa
6%
India / Middle East
9%
India
1%
West Africa
2%
Latin America
14%
Inland US
25%
US GOM
56%
Middle East
1%


10
A Global Footprint with Significant Expansion Potential
Mexico
Jackup Rigs
2
Platform Rig 
1
West Africa
Jackup Rig
1
Liftboats
17
Middle East
Jackup Rig  1
Malaysia
(1)
Jackup Rig   1
U.S. Gulf Coast
Inland Barges
27
Land Rigs (TX)
2
Trinidad
Jackup Rig
1
Land Rig 
1
(1)
Pro forma for TODCO’s
announced THE 208 relocation.
(2)
Includes Hercules Rig 26, marketing internationally.
Brazil
Jackup Rig  1
Venezuela
Land Rigs
6
U.S. Gulf of Mexico
Jackup Rigs
25
Submersible       3
Liftboats
47
India
Jackup Rig  1
Global Summary
Liftboats
64
Jackup Rigs
33
Inland Barges
27
Land Rigs
9
Submersible       3
Platform Rigs
1
(2)


11
Fourth Largest Global Jackup Fleet
Current Global Jackup Landscape
Current
Gulf
of
Mexico
Jackup
Landscape
(1)
Source:    ODS-Petrodata
(1)
Excludes rigs that have announced mobilization out of the GOM, including Hercules Rig 26
43
42
40
33
27
25
24
20
16
13
11
10
9
0
5
10
15
20
25
30
35
40
45
ESV
GSF
NE
PF
HERO
PDE
RIG
THE
RDC
NBR
DO
COSL
Nat'lHERO
Drilling
24
18
14
12
9
7
6
4
3
3
0
5
10
15
20
25
PF
HERO
THE
ESV
PDE
NBR
RDC
HERO
DO
Blake
GSF


12
A Leading Player in US Gulf Coast Inland Barges
Source:
Company estimates based on public information.
27
13
4
2
2
1
0
5
10
15
20
25
30
HERO
PKD
Axxis
Tetra
Coastal
NBR


13
A Leading Provider of Liftboat Services
Current Gulf of Mexico Liftboat Landscape
Current West Africa Liftboat Landscape
Source:
Company estimates based on public information.
(1)
Denotes cold-stacked or abandoned vessels.
47
27
15
6
6
4
3
3
2
1
0
10
20
30
40
50
HERO
SPN
Aries
Montco
OL
Laredo
AMC
OMC
Seahorse
CS Liftboats
17
3
2
1
1
0
5
10
15
20
HERO
Zumax
(1)
Zukus
(1)
NV De Brandt
Shoreline


14
August
2005
Acquired
the Whale
Shark
liftboat
from
CS Liftboats
June
2005
Acquired Rig 16
from Transocean
and 17 liftboats
from Superior
Energy
October
2004
Acquired 22
liftboats from
Global Industries
August
2004
Acquired five
jackup rigs from
Parker Drilling
Successful integration of 12 asset acquisitions since formation
Integrated several large fleets, operations and employees
Opportunistic acquisition strategy
Focus on return on capital employed
Successful Acquisition Track Record
February
2006
Acquired Rig 26
from Aries
Offshore Partners
Ltd.
November
2005
Acquired seven
liftboats from
Danos & Curole
September
2005
Acquired Rig 31
from Hydrocarbon
Capital II LLC
June
2006
Acquired six
liftboats from
Laborde Marine
Lifts
November
2006
Acquired eight
liftboats and
assumed rights to
operate five
additional liftboats
from Halliburton
January
2005
Acquired Rig 25
from Parker Drilling
and
Rig
30
from
Porterhouse
Offshore, L.P.


15
Stated Key Objectives –
Past, Present, and Future
Grow the Company
Merger expedites growth initiative
Utilize critical mass and financial strength to enhance future growth
Quickly integrate and deploy newly acquired assets
Identify and implement operational best practices
Past successes of effectively integrating acquisitions
Maintain Financial Discipline
Pro forma debt level of 2.0x LTM EBITDA is within industry range
Use significant free cash to de-lever
Diversify asset base and geographic footprint
Leverage combined operational and management depth to continue and
accelerate international expansion


Business Outlook


17
0
50
100
150
200
250
300
$-
$25
$50
$75
$100
$125
0
50
100
150
200
250
300
350
400
450
500
$-
$25
$50
$75
$100
$125
$150
$175
$200
Source:
ODS-Petrodata. West Africa dayrates are used to approximate average market rates for worldwide jackup rigs.
Solid Backlog of Work Globally
Business visibility has increased substantially over the past six years, but has
weakened considerably in the US Gulf of Mexico over the last several months
Current Worldwide Jackup Backlog
Current GOM Jackup Backlog
Jan 1999
187 Days
Feb 2007
459 Days
West Africa 300’
IC
200’
MC Jackups in GOM
Jan 2004
32 Days
Feb 2007
134 Days


18
Inland Barge Update
Largest operator in US Gulf Coast
72
total
barges
of
which
23
are
workover
only
Of 49 drilling barges, TODCO owns 27, Parker owns 14 (84% of supply)
TODCO holds excess supply with 17 operating and 10 cold stacked
Latest Contracted Dayrates
Rigs
Avg
High
-
Conventional   <2000hp
1
$30,800
$30,800
Conventional
2000hp
2
32,500
35,300
Conventional      3000hp
3
45,800
60,500
Posted
2000hp
3
56,900
65,300
Posted
3000hp
8
46,400
62,100
17
$45,600
$57,400
(1)
TODCO fleet as of February 28, 2007
(1)
Marketed


19
Liftboat Update
Weather causing seasonal decline in utilization in the GOM
Liftboats cannot mobilize in seas greater than 5 ft.
As much as 15% of the fleet was waiting on weather at various times during
January and February, but utilization improving in March
Return to more typical seasonality
During 2006 demand was extremely robust given the hurricane repair work
and operators were willing to pay for liftboats while waiting out the weather
GOM Dayrate outlook stable
Dayrates likely to remain flat into the first part of 2007
West Africa remains strong
Increased spot market prices by 30% during December
May mobilize additional vessels into West Africa


20
Conclusions
Enhances position in Gulf of Mexico and increases operational flexibility
Provides asset and geographic diversity
Expands international footprint for future growth
Timely combination in a fragmented jackup market
Combines leaders in barge drilling and liftboats
Accretive to earnings and cash flow per share
Use significant free cash flow to de-lever


Appendix A
Introduction to
Hercules Offshore Inc.


22
Hercules Offshore Overview
Unique business mix within the oil services industry
Tremendous growth since inception in late 2004
Experienced management team
Proven track record of maximizing return on capital
Note:  See Explanatory Information slide.  Division Adjusted EBITDA does not include corporate G&A and other income/expense.
Quarterly Revenue
Quarterly Adjusted EBITDA
($ in millions)
($ in millions)
$9.2
$10.8
$13.9
$24.0
$29.1
$33.7
$42.9
$47.3
$24.9
$26.3
$28.2
$24.0
$27.0
$42.6
$54.3
$67.4
1Q 05
2Q 05
3Q 05
4Q 05
1Q 06
2Q 06
3Q 06
4Q 06
Liftboats
Drilling
$4.2
$4.6
$5.8
$11.7
$16.8
$20.7
$26.7
$24.5
$12.5
$12.6
$13.8
$11.3
$14.1
$26.8
$33.7
$44.0
1Q 05
2Q 05
3Q 05
4Q 05
1Q 06
2Q 06
3Q 06
4Q 06
Liftboats
Drilling


23
The Global Leader in Liftboats
64 vessels worldwide
Hercules operates the largest liftboat fleet in the GOM with 47 vessels
Largest liftboat fleet in West Africa with 17 vessels
Acquired Halliburton’s Nigerian-based West African liftboat fleet
13 liftboats, 120 employees
Multi-year alliance with Halliburton
Retained personnel
Improved day-rates
Leveraging shore-base for expansion outside Nigeria
Targeting emerging opportunities in Middle East
Utilization
tends
to
be
more
stable
and
dayrates
tend
to
be
more
predictable
than that of jackups, given their use throughout the life of a well


24
Hercules’
Liftboat Fleet
Starfish
Class 140’
Liftboat
Swordfish
Class 200’
Liftboat
(1)
Within the liftboat industry, the terms leg-length and liftboat class are used interchangeably.
Note:
Utilization
is
defined
as
the
total
number
of
operating
days
in
the
period
as
a
percentage
of
the
total
number
of
calendar
days in the
period our liftboats were actively marketed.  Dayrates include reimbursements from customers under relevant contracts.
67%
Leg -
Length /
YTD
Liftboat
Class
(1)
Number of
Feb-06
Feb-07
Y-o-Y
2007
(Feet)
Vessels
Dayrate
Dayrate
% Change
Utilization
Gulf of Mexico
260'
1
$28,231
$34,652
23%
100%
230'
3
$21,191
28,569
35%
23%
190-215'
6
15,779
22,051
40%
81%
170'
2
NA
NA
NA
3%
140-150'
6
8,628
10,539
22%
87%
120-130'
14
7,111
8,435
19%
63%
105'
15
5,481
6,992
28%
60%
Domestic Total
47
$9,334
$12,292
32%
63%
West Africa
All Vessels
17
$10,004
$11,733
17%
78%


25
Hercules Contract Drilling Segment Overview
Hercules owns a fleet of nine jackup rigs
Six operating in the U.S. GOM
One operating in Qatar
One operating in India
One currently in a shipyard being upgraded to a 250’IC for international
operations (available early Q3’07)
Specialized
design
features
of
three
of
Hercules’
jackup
rigs contribute to
high utilization of the Company’s fleet


26
Hercules Drilling Fleet Status
Upgrading to 250’IC
FY 2006
FY 2007
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Current
Customer
Rig 11
$61,914
$64,871
$65,976
Bois d’Arc
Rig 15
$52,692
$78,540
$95,487
Energy XXI
Rig 20
$73,499
$84,886
$100,781
Chevron
Rig 21
$79,925
$82,443
Chevron
Rig 22
$67,826
$83,899
$82,497
Helis
Rig 30
$69,162
$67,933
$71,443
Rig 16
Rig 26
Cairn
Rig 31
Average Dayrate
$69,534
$76,129
$81,283
Note:  2006 dayrates are based on actual results. Subsequent quarters represent estimates based on current backlog.
Contracted
Available
Shipyard
$66,029
$96,354
$115,008
$83,853
$85,226
$83,784
Through  May 2008 @  $69-70,000
$84-86,000
$79-81,000
$79-81,000
$69-70,000
$85-87,000
$117,383
$140,000
$139K-141K
$69,860
$64-66,000
$69,461
$89,386
Energy XXI
Occidental
International
US Gulf of Mexico
$84-86,000
$74-76,000
TBD


Appendix B
Combined Fleet Details


28
Combined Jackup Fleet
Under Contract
West Africa
ILC 150
THE 185
Under Contract
Trinidad
MC 100
THE 110
Reactivating
Mobilizing to SE Asia
MC 200
THE 208
Under Contract
Middle East
ILC 170
Rig 16
Under Contract
Mexico
MC 200
THE 206
Shipyard
Mexico
MC 200
THE 205
Under Contract
India
MS 250
Rig 31
Under Contract
Brazil
ILC 150
THE 156
Under Contract
US GOM
MS 250
THE 251
Cold Stacked
US GOM
MS 250
THE 256
Cold Stacked
US GOM
MS 250
THE 255
Cold Stacked
US GOM
MS 250
THE 254
Under Contract
US GOM
MS 250
THE 253
Under Contract
US GOM
MS 250
THE 252
Under Contract
US GOM
MS 250
THE 250
Under Contract
US GOM
MS 250
Rig 30
Under Contract
US GOM
MC 200
THE 207
Under Contract
US GOM
MC 200
THE 204
Under Contract
US GOM
MC 200
THE 203
Under Contract
US GOM
MC 200
THE 202
Shipyard
US GOM
MC 200
THE 201
Under Contract
US GOM
MC 200
THE 200
Under Contract
US GOM
MC 200
Rig 11
Under Contract
US GOM
MC 173
Rig 22
Idle
US GOM
MC 150
THE 153
Under Contract
US GOM
MC 150
THE 152
Under Contract
US GOM
MC 120
Rig 21
Under Contract
US GOM
MC 100
Rig 20
Shipyard
US GOM
ILC 250
Rig 26
Cold Stacked
US GOM
ILC 160
THE 191
Cold Stacked
US GOM
ILC 150
THE 155
Under Contract
US GOM
ILC 150
THE 150
Under Contract
US GOM
ILS 85
Rig 15
Status as of
2/28/07
Region of Operation
Vessel Class
Asset Name


29
Inland Barge Fleet
Under Contract
30,000
Posted
3,000 HP
Rig 64
Cold Stacked
30,000
Posted
3,000 HP
Rig 61
Under Contract
30,000
Posted
3,000 HP
Rig 55
Under Contract
30,000
Posted
3,000 HP
Rig 49
Under Contract
30,000
Posted
3,000 HP
Rig 48
Cold Stacked
30,000
Posted
3,000 HP
Rig 47
Under Contract
30,000
Posted
3,000 HP
Rig 46
Under Contract
30,000
Posted
3,000 HP
Rig 41
Under Contract
30,000
Posted
3,000 HP
Rig 27
Under Contract
30,000
Posted
3,000 HP
Rig 17
Under Contract
25,000
Posted
3,000 HP
Rig 57
Under Contract
25,000
Posted
2,000 HP
Rig 52
Cold Stacked
25,000
Posted
2,000 HP
Rig 10
Under Contract
25,000
Posted
2,000 HP
Rig 09
Cold Stacked
25,000
Posted
2,000 HP
Rig 07
Cold Stacked
30,000
Conventional
2,000 HP
Rig 32
Cold Stacked
30,000
Conventional
3,000 HP
Rig 31
Cold Stacked
30,000
Conventional
3,000 HP
Rig 30
Under Contract
30,000
Conventional
3,000 HP
Rig 29
Under Contract
30,000
Conventional
3,000 HP
Rig 28
Under Contract
30,000
Conventional
3,000 HP
Rig 11
Under Contract
25,000
Conventional
3,000 HP
Rig 15
Under Contract
20,000
Conventional
2,000 HP
Rig 01
Cold Stacked
14,000
Conventional
2,000 HP
Rig 23
Cold Stacked
15,000
Conventional
1,000 HP
Rig 21
Cold Stacked
14,000
Conventional
1,000 HP
Rig 20
Under Contract
14,000
Conventional
1,000 HP
Rig 19
Status
as of 2/28/07
Drilling Depth
Platform Type
Vessel Class
Asset Name


30
Liftboat Fleet
West Africa
400,000
215
Blue Shark
US GOM
300,000
140
Rainbow Runner
West Africa
590,000
170
Oilfish
US GOM
300,000
140
Blue Runner
West Africa
200,000
150
Black Marlin
US GOM
150,000
140
Starfish
West Africa
200,000
150
F.J. Leleux
US GOM
150,000
130
Triggerfish
West Africa
200,000
145
Rudderfish
US GOM
150,000
130
Albacore
West Africa
175,000
145
Pilotfish
US GOM
150,000
130
Stingray
West Africa
150,000
130
Scamp
US GOM
150,000
130
Sandshark
West Africa
100,000
120
Zoal
Albrecht
US GOM
142,000
130
Mahi
Mahi
West Africa
100,000
120
Tigerfish
US GOM
137,500
130
Sailfish
West Africa
100,000
120
Solefish
US GOM
130,000
130
Moray
West Africa
100,000
120
James Choat
US GOM
110,000
130
Skipfish
West Africa
100,000
120
Durwood
Speed
US GOM
100,000
130
Pompano
West Africa
100,000
120
Charlie Cobb
US GOM
150,000
125
Rockfish
West Africa
100,000
105
Tapertail
US GOM
150,000
120
Grouper
West Africa
100,000
105
Gemfish
US GOM
150,000
120
Gar
West Africa
90,000
105
Bonefish
US GOM
110,000
120
Tilapia
West Africa
72,000
105
Croaker
US GOM
110,000
120
Sea Robin
US GOM
729,000
260
Whale Shark
US GOM
130,000
105
Pike
US GOM
1,000,000
230
Tigershark
US GOM
110,000
105
Jackfish
US GOM
500,000
229
Man-O-War
US GOM
110,000
105
Tarpon
US GOM
500,000
229
Kingfish
US GOM
110,000
105
Marlin
US GOM
500,000
215
Wahoo
US GOM
110,000
105
Herring
US GOM
500,000
205
Amberjack
US GOM
110,000
105
Dolphin
US GOM
1,000,000
200
Bullshark
US GOM
110,000
105
Cobia
US GOM
798,000
200
Cutlassfish
US GOM
110,000
105
Carp
US GOM
798,000
200
Creole Fish
US GOM
110,000
105
Barracuda
US GOM
700,000
190
Swordfish
US GOM
100,000
105
Palometa
US GOM
654,000
175
Mako
US GOM
100,000
105
Sea Trout
US GOM
575,850
175
Leatherjack
US GOM
100,000
105
Seabream
US GOM
200,000
150
Seabass
US GOM
100,000
105
Wolffish
US GOM
200,000
150
Manta Ray
US GOM
100,000
105
Remora
US GOM
150,000
145
Hammerhead
US GOM
100,000
105
Corina
Operating
Region
Maximum
Deck Load
(pounds)
Leg Length
(feet)
Asset Name
Operating
Region
Maximum Deck
Load (pounds)
Leg Length
(ft.)
Asset Name


31
Other Rigs
Idle
USA --
Texas
8,000
900 HP
Land
Rig #27
Reactivating
USA --
Texas
6,500
750 HP
Land
Rig #26
Under Contract
Venezuela
35,000
3,000 HP
Land
Cliffs #55
Under Contract
Venezuela
30,000
3,000 HP
Land
Cliffs #54
Under Contract
Venezuela
25,000
2,000 HP
Land
Cliffs #43
Under Contract
Venezuela
25,000
2,000 HP
Land
Cliffs #42
Under Contract
Venezuela
25,000
2,000 HP
Land
Cliffs #40
Warm Stacked
Venezuela
18,000
2,000 HP
Land
Cliffs #37
Under Contract
Trinidad
18,000
2,000 HP
Land
Cliffs #36
Under Contract
Mexico
25,000
--
Platform
Platform 3
Under Contract
US GOM
30,000
--
Submersible
THE 78
Under Contract
US GOM
30,000
--
Submersible
THE 77
Under Contract
US GOM
25,000
--
Submersible
THE 75
Status
Region of Operation
Drilling Depth
Details
Rig Type
Asset Name


32
Explanatory
Information
Adjusted EBITDA is calculated as net income before interest expense, taxes, depreciation and amortization, gain on disposal of assets and loss on early
retirement of debt. Adjusted EBITDA is included in this presentation because our management considers it an important supplemental measure of our
performance and believes that it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our
industry, some of which present EBITDA and Adjusted EBITDA when reporting their results. We regularly evaluate our performance as compared to other
companies in our industry that have different financing and capital structures and/or tax rates by using Adjusted EBITDA. In addition, we utilize Adjusted
EBITDA in evaluating acquisition targets. Management also believes that Adjusted EBITDA is a useful tool for measuring our ability to meet our future debt
service, capital expenditures and working capital requirements, and Adjusted EBITDA is commonly used by us and our investors to measure our ability to
service indebtedness. Adjusted EBITDA is not a substitute for the GAAP measures of earnings or of cash flow and is not necessarily a measure of our ability
to fund our cash needs. In addition, it should be noted that companies calculate EBITDA and Adjusted EBITDA differently and, therefore, Adjusted EBITDA as
presented for us may not be comparable to EBITDA and Adjusted EBITDA reported by other companies. Adjusted EBITDA has material limitations as a
performance
measure
because
it
excludes
interest
expense,
taxes,
depreciation
and amortization, gain on disposal of assets and loss on early retirement of
debt. The following tables reconcile Adjusted EBITDA with net income.
Note: Reconciliations for Drilling and Liftboats do not include corporate adjustments.
EBITDA Reconciliation
($ in millions)
Drilling
Liftboats
1Q 05
2Q 05
Q3 05
4Q 05
1Q 06
2Q 06
3Q 06
4Q 06
1Q 05
2Q 05
Q3 05
4Q 05
1Q 06
2Q 06
3Q 06
4Q 06
Net Income
$9.5
$7.6
$10.5
$0.5
$25.6
$15.6
$19.1
$27.2
$2.5
$1.5
$2.5
($1.6)
$7.5
$9.3
$12.6
$12.7
Plus: Interest Expense
1.8
1.8
1.9
1.5
1.3
1.4
1.7
2.3
0.5
0.6
0.9
0.8
0.7
0.8
0.9
1.4
Plus: Income Tax Expense
6.9
15.1
7.5
10.5
10.0
8.9
4.4
5.5
7.6
4.7
Plus: Depreciation and Amortization
1.3
1.3
1.4
1.5
1.7
2.3
3.5
4.0
1.2
1.5
2.3
3.2
4.3
5.2
5.6
5.7
Plus: Loss on Early Retirement of Debt
1.8
0.8
0.9
0.5
Less: Gain on Disposal of Assets
29.6
1.1
Adjusted EBITDA
$12.5
$12.6
$13.8
$11.3
$14.1
$26.8
$33.7
$44.0
$4.2
$4.6
$5.8
$11.7
$16.8
$20.7
$26.7
$24.5
Company EBITDA Reconciliation
($ in millions)
Company
1Q 05
2Q 05
Q3 05
4Q 05
1Q 06
2Q 06
3Q 06
4Q 06
Net Income
$11.4
$8.2
$10.1
($2.2)
$30.9
$22.9
$29.7
$35.5
Plus: Interest Expense
2.3
2.5
2.7
2.3
2.1
2.2
2.6
2.5
Plus: Income Tax Expense
15.4
18.6
12.3
17.4
16.1
Plus: Loss on Early Retirement of Debt
2.8
1.3
Less: Gain on Disposal of Assets
29.6
1.1
Adjusted EBIT
$13.7
$13.5
$12.8
$16.8
$22.0
$37.4
$48.6
$54.1
Plus: Depreciation and Amortization
2.5
2.9
3.8
4.7
5.9
7.6
9.1
9.7
Adjusted EDITDA
$16.2
$16.3
$16.6
$21.5
$27.9
$45.0
$57.7
$63.9


33
Risk Factors
Risks with respect to the combination of Hercules Offshore and TODCO, as well as other recent and
future acquisitions, include the risk that we will not be able to close the transaction, as well as
difficulties in the integration of the operations and personnel of the acquired company,  diversion of
management's attention away from other business concerns, and the assumption of any undisclosed
or other liabilities of the acquired company.  We expect to incur substantial transaction and merger
related costs associated with completing the merger with TODCO, obtaining regulatory approvals,
combining the operations of the two companies and achieving desired synergies. Additional
unanticipated costs may be incurred in the integration of the businesses of Hercules Offshore and
TODCO. Expected benefits of the merger may not be achieved in the near term, or at all.  Hercules
Offshore will have a significant amount of additional debt as a result of  the merger.  This debt will
require us to use cash flow to repay indebtedness,  may  have a material adverse effect on  our 
financial health,  and  may limit  our  future operations  and  ability to borrow additional funds.


34
Important Information to be Filed
In connection with the proposed transaction, Hercules Offshore will file a Form S-4, TODCO will file a
definitive proxy statement and both companies will file other relevant documents concerning the
proposed merger transaction with the SEC.  INVESTORS ARE URGED TO READ THE FORM S-4
AND THE PROXY STATEMENT WHEN THEY BECOME AVAILABLE, AND ANY OTHER RELEVANT
DOCUMENTS FILED WITH THE SEC, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION REGARDING THE MERGER.  Investors may obtain a free copy of the Form S-4 and
the proxy statement (when available) and the other documents free of charge at the website
maintained by the SEC at www.sec.gov
<http://www.sec.gov/>.
Hercules Offshore and TODCO and their respective directors and executive officers may be deemed
to be participants in the solicitation of proxies from the stockholders of Hercules Offshore and TODCO
in connection with the merger.  Information about the directors and executive officers of Hercules
Offshore and their ownership of Hercules common stock is set forth in the proxy statement for
Hercules Offshore's
2006 Annual Meeting of Stockholders filed with the SEC on March
24, 2006. 
Information about the directors and executive officers of TODCO and their ownership of TODCO
common stock is set forth in the  proxy statement for TODCO's
2006 annual meeting, which was filed
with the SEC on March 22, 2006.  Investors may obtain additional
information regarding the interests
of such participants by reading the Form S-4 and proxy statement for the merger when they become
available.



CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

Except for the historical and factual information contained herein, the matters set forth in this filing, including statements as to the expected benefits of the acquisition such as efficiencies, cost savings, market profile and financial strength, and the competitive ability and position of the combined company, and other statements identified by words such as “estimates,” “expects,” “projects,” “plans,” and similar expressions are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including required approvals by TODCO stockholders and regulatory agencies, the possibility that the anticipated benefits from the acquisition cannot be fully realized, the possibility that costs or difficulties related to the integration of TODCO’s operations into Hercules will be greater than expected, the impact of competition and other risk factors Hercules’ and TODCO’s reports filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. TODCO undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise.

ADDITIONAL INFORMATION

In connection with the proposed transaction, Hercules will file a Form S-4, TODCO will file a definitive proxy statement and both companies will file other relevant documents concerning the proposed merger transaction with the Securities and Exchange Commission (“SEC”). INVESTORS ARE URGED TO READ THE FORM S-4 AND THE PROXY STATEMENT WHEN THEY BECOME AVAILABLE, AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION REGARDING THE MERGER. Investors may obtain a free copy of the Form S-4 and the proxy statement (when available) and the other documents free of charge at the website maintained by the SEC at www.sec.gov.

In addition, the documents filed with the SEC by TODCO may be obtained free of charge from TODCO’s website at www.theoffshoredrillingcompany.com or by calling TODCO’s Investor Relations department at (713) 278-6000. The documents filed with the SEC by Hercules may be obtained free of charge from Hercules’ website at www.herculesoffshore.com or by calling Hercules Offshore’s Investor Relations at (713) 979-9300.

TODCO, Hercules and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of Hercules and TODCO in

 

3


connection with the merger. Information about the directors and executive officers of Hercules and their ownership of Hercules common stock is set forth in the proxy statement for Hercules’ 2006 Annual Meeting of Stockholders filed with the SEC on March 24, 2006. Information about the directors and executive officers of TODCO and their ownership of TODCO common stock is set forth in the proxy statement for TODCO’s 2006 annual meeting, which was filed with the SEC on March 22, 2006. Investors may obtain additional information regarding the interests of such participants by reading the Form S-4 and proxy statement for the merger when they become available.

 

4