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                                                                    EXHIBIT 10.3

                             STOCK OPTION AGREEMENT


         STOCK OPTION AGREEMENT, dated as of May 23, 2001 (the "Agreement"),
between Marine Drilling Companies, Inc., a Texas corporation ("Grantee"), and
Pride International, Inc., a Louisiana corporation ("Issuer").

                                    RECITALS

         A. Grantee and Issuer are, concurrently with the execution and delivery
of this Agreement, entering into an Agreement and Plan of Merger, dated as of
the date hereof, among Grantee, Issuer, PM Merger, Inc., a Delaware corporation,
and AM Merger, Inc., a Delaware corporation (the "Merger Agreement"), pursuant
to which, among other things, the parties will engage in a business combination
in a merger of equals (the "Merger");

         B. As a condition to their willingness to enter into the Merger
Agreement, Grantee has required that Issuer agree, and believing it to be in the
best interests of Issuer, Issuer has agreed, among other things, to grant to
Grantee the Option (as hereinafter defined) to purchase shares of common stock,
par value $.01 per share, of Issuer ("Issuer Common Stock") at a price per share
equal to the Exercise Price (as hereinafter defined);

         C. Capitalized terms used without definition herein having the meanings
assigned to them in the Merger Agreement; and

         D. In consideration of the foregoing and the mutual representations,
warranties, covenants and agreements herein contained, and intending to be
legally bound hereby, the parties hereto agree as follows:

                                    ARTICLE 1

                            OPTION TO PURCHASE SHARES

         Section 1.1 Grant of Option. (a) Issuer hereby grants to Grantee an
irrevocable option to purchase, in whole or in part, an aggregate of up to
14,645,963 duly authorized, validly issued, fully paid and nonassessable shares
of Issuer Common Stock (representing 19.9% of the outstanding shares of Issuer
Common Stock as of May 22, 2001) on the terms and subject to the conditions set
forth herein (the "Option"); provided, however, that in no event shall the
number of shares of Issuer Common Stock for which this Option is exercisable
exceed 19.9% of the issued and outstanding shares of Issuer Common Stock at the
time of exercise without giving effect to the issuance of any Option Shares (as
hereinafter defined). The number of shares of Issuer Common Stock that may be
received upon the exercise of the Option and the Exercise Price are subject to
adjustment as herein set forth.



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         (b) In the event that any (i) additional shares of Issuer Common Stock
are issued or otherwise become outstanding after the date of this Agreement
(other than pursuant to this Agreement and other than pursuant to an event
described in Section 3.1 hereof), or (ii) shares of Issuer Common Stock are
redeemed, repurchased, retired or otherwise cease to be outstanding after the
date of this Agreement, the number of shares of Issuer Common Stock subject to
the Option shall be increased or decreased, as appropriate, so that, after such
issuance or redemption, such number together with any shares of Issuer Common
Stock previously issued pursuant hereto, equals 19.9% of the number of shares of
Issuer Common Stock then issued and outstanding without giving effect to any
shares subject or issued pursuant to the Option. Nothing contained in this
Section 1.1(b) or elsewhere in this Agreement shall be deemed to authorize
Issuer to breach or fail to comply with any provision of the Merger Agreement.
As used herein, the term "Option Shares" means the shares of Issuer Common Stock
issuable pursuant to the Option, as the number of such shares shall be adjusted
pursuant to the terms hereof.

         Section 1.2 Exercise of Option. (a) The Option may be exercised by
Grantee, in whole or in part, at any time, or from time to time, commencing upon
the Exercise Date and prior to the Expiration Date. As used herein, the term
"Exercise Date" means the date on which Issuer becomes obligated to pay a fee
pursuant to Section 9.5(b)(i) of the Merger Agreement. As used herein, the term
"Expiration Date" means the first to occur prior to Grantee's exercise of the
Option pursuant to Section 1.2(b) of:

         (i) the Effective Time;

         (ii) 12 months after the first receipt by the Grantee of written notice
     from the Issuer of the occurrence of an Exercise Date; or

         (iii) the date of termination of the Merger Agreement, unless, in the
     case of this clause (iii), an Exercise Date has occurred or could still
     occur.

Notwithstanding the termination of the Option, Grantee shall be entitled to
purchase those Option Shares with respect to which it may have exercised the
Option by delivery of an Option Notice (as defined below) prior to the
Expiration Date, and the termination of the Option will not affect any rights
hereunder which by their terms do not terminate or expire prior to or at the
Expiration Date.

         (b) In the event Grantee wishes to exercise the Option, Grantee shall
send a written notice to Issuer of its intention to so exercise the Option (an
"Option Notice"), specifying the number of Option Shares to be purchased (and
the denominations of the certificates, if more than one), whether the aggregate
Exercise Price will be paid in cash or by surrendering a portion of the Option
in accordance with Section 1.3(b) or a combination thereof, and the place in the
United States, time and date of the closing of such purchase (the "Option
Closing" and the date of such Closing, the "Option Closing Date"), which date
shall not be less than two business days nor more than ten business days from
the date on which an Option Notice is delivered; provided that the Option
Closing shall be held only if (i) such purchase would not otherwise violate or
cause the violation of, any applicable


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material law, statute, ordinance, rule or regulation (collectively, "Laws")
(including the HSR Act), and (ii) no material judgment, order, writ, injunction,
ruling or decree of any governmental entity (collectively, "Orders") shall have
been promulgated, enacted, entered into, or enforced by any governmental entity
which prohibits delivery of the Option Shares, whether temporary, preliminary or
permanent; provided, however, that the parties hereto shall use their reasonable
best efforts to (x) promptly make and process all necessary filings and
applications and obtain all consents, approvals, Orders, authorizations,
registrations and declarations or expiration or termination of any required
waiting periods (collectively, "Approvals") and to comply with any such
applicable Laws and (y) have any such Order vacated or reversed. In the event
the Option Closing is delayed pursuant to clause (i) or (ii) above, the Option
Closing shall be within ten business days following the cessation of such
restriction, violation, Law or Order or the receipt of any necessary Approval,
as the case may be (so long as the Option Notice was delivered prior to the
Expiration Date); provided further that, notwithstanding any prior Option
Notice, Grantee shall be entitled to rescind such Option Notice and shall not be
obligated to purchase any Option Shares in connection with such exercise upon
written notice to such effect to Issuer.

         (c) At any Option Closing, (i) Issuer shall deliver to Grantee all of
the Option Shares to be purchased by delivery of a certificate or certificates
evidencing such Option Shares in the denominations designated by Grantee in the
Option Notice, and (ii) if the Option is exercised in part and/or surrendered in
part to pay the aggregate Exercise Price pursuant to Section 1.3(b), Issuer and
Grantee shall execute and deliver an amendment to this Agreement reflecting the
Option Shares for which the Option has not been exercised and/or surrendered. If
at the time of issuance of any Option Shares pursuant to an exercise of all or
part of the Option hereunder, Issuer shall have issued any rights or other
securities which are attached to or otherwise associated with the Issuer Common
Stock, then each Option Share issued pursuant to such exercise shall also
represent such rights or other securities with terms substantially the same as
and at least as favorable to Grantee as are provided under any shareholder
rights agreement or similar agreement of Issuer then in effect. At the Option
Closing, Grantee shall pay to Issuer by wire transfer of immediately available
funds to an account specified by Issuer to Grantee in writing at least two
business days prior to the Option Closing an amount equal to the Exercise Price
multiplied by the number of Option Shares to be purchased for cash pursuant to
this Article I; provided, however, that the failure or refusal of Issuer to
specify an account shall not affect Issuer's obligation to issue the Option
Shares.

         (d) Upon the delivery by Grantee to Issuer of the Option Notice and the
tender of the applicable aggregate Exercise Price in immediately available funds
or the requisite portion of the Option in accordance with Section 1.3, Grantee
shall be deemed to be the holder of record of the Option Shares issuable upon
such exercise, notwithstanding that the stock transfer books of Issuer may then
be closed, that certificates representing such Option Shares may not then have
been actually delivered to Grantee, or Issuer may have failed or refused to take
any action required of it hereunder. Issuer shall pay all expenses that may be
payable in connection with the preparation, issuance and delivery of stock
certificates or an amendment to this Agreement under this Section 1.2 and any
filing fees and other expenses arising from the performance of the transactions
contemplated hereby.


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         Section 1.3 Exercise Price; Payments. (a) The purchase and sale of the
Option Shares pursuant to Section 1.2 of this Agreement shall be at a purchase
price equal to $32.65 per Share (as such amount may be adjusted pursuant to the
terms hereof, the "Exercise Price"), payable at Grantee's option in cash, by
surrender of a portion of the Option in accordance with Section 1.3(b), or a
combination thereof.

         (b) Grantee may elect to purchase Option Shares issuable, and pay some
or all of the aggregate Exercise Price payable, upon an exercise of the Option
by surrendering a portion of the Option with respect to such number of Option
Shares as is determined by dividing (i) the aggregate Exercise Price payable in
respect of the number of Option Shares being purchased in such manner by (ii)
the excess of the Fair Market Value (as defined below) per share of Issuer
Common Stock as of the last trading day preceding the date Grantee delivers its
Option Notice (such date, the "Option Exercise Date") over the per share
Exercise Price. The "Fair Market Value" per share of Issuer Common Stock shall
be (i) if the Issuer Common Stock is listed on the New York Stock Exchange, Inc.
(the "NYSE") or any other nationally recognized exchange or trading system as of
the Option Exercise Date, the average of last reported sale prices per share of
Issuer Common Stock thereon for the 5 trading days commencing on the 6th trading
day immediately preceding the Option Exercise Date, or (ii) if the Issuer Common
Stock is not listed on the NYSE or any other nationally recognized exchange or
trading system as of the Option Exercise Date, the amount determined by a
mutually acceptable independent investment banking firm as the value per share
the Issuer Common Stock would have if publicly traded on a nationally recognized
exchange or trading system (assuming no discount for minority interest,
illiquidity or restrictions on transfer). That portion of the Option so
surrendered under this Section 1.3(b) shall be canceled and shall thereafter be
of no further force and effect.

         (c) Certificates for the Option Shares delivered at an Option Closing
will have typed or printed thereon a restrictive legend which will read
substantially as follows:

         "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
         REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY BE
         REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN EXEMPTION FROM SUCH
         REGISTRATION IS AVAILABLE. SUCH SECURITIES ARE ALSO SUBJECT TO
         ADDITIONAL RESTRICTIONS ON TRANSFER AS SET FORTH IN THE STOCK OPTION
         AGREEMENT DATED AS OF MAY 23, 2001, A COPY OF WHICH MAY BE OBTAINED
         FROM THE SECRETARY OF PRIDE INTERNATIONAL, INC. AT ITS PRINCIPAL
         EXECUTIVE OFFICES."


It is understood and agreed that (i) the reference to restrictions arising under
the Securities Act in the above legend will be removed, by delivery of
substitute certificate(s) without such reference if such Option Shares have been
registered pursuant to the Securities Act, such Option Shares have been sold in
reliance on and in accordance with Rule 144 under the Securities Act or Grantee
has delivered to Issuer a copy of a letter from the staff of the SEC, or an
opinion of counsel in form and substance reasonably satisfactory to Issuer and
its counsel, to the effect that such legend is not

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required for purposes of the Securities Act and (ii) the reference to
restrictions pursuant to this Agreement in the above legend will be removed by
delivery of substitute certificate(s) without such reference if the Option
Shares evidenced by certificate(s) containing such reference have been sold or
transferred in compliance with the provisions of this Agreement under
circumstances that do not require the retention of such reference.

                                    ARTICLE 2

                         REPRESENTATIONS AND WARRANTIES

         Section 2.1 Representations and Warranties of Grantee. Grantee hereby
represents and warrants to Issuer that any Option Shares or other securities
acquired by Grantee upon exercise of the Option will not be taken with a view to
the public distribution thereof and will not be transferred or otherwise
disposed of except in a transaction registered or exempt from registration under
the Securities Act.

         Section 2.2 Representations and Warranties of Issuer. Issuer hereby
represents and warrants to Grantee as follows:

         (a) Option Shares. Issuer has taken all necessary corporate and other
action to authorize and reserve for issuance, and, subject to receipt of any
Approvals, to permit it to issue, the Option Shares and all additional shares or
other securities which may be issued pursuant to Section 3.1 upon exercise of
the Option, and, at all times from the date hereof until such time as the
obligation to deliver Option Shares hereunder terminates, will have reserved for
issuance upon exercise of the Option the Option Shares and such other additional
shares or securities, if any. All of the Option Shares and all additional shares
or other securities or property which may be issuable pursuant to Section 3.1,
upon exercise of the Option and issuance pursuant hereto, shall be duly
authorized, validly issued, fully paid and nonassessable, shall be delivered
free and clear of all Liens of any nature whatsoever, and shall not be subject
to any preemptive or similar right of any Person.

         (b) No Restrictions. No Louisiana law or other state takeover statute
or similar Law and no provision of the Articles of Incorporation or Bylaws of
Issuer or any agreement to which Issuer is a party (a) would or would purport to
impose restrictions which might adversely affect or delay the consummation of
the transactions contemplated by this Agreement, or (b) as a result of the
consummation of the transactions contemplated by this Agreement, (i) would or
would purport to restrict or impair the ability of Grantee to vote or otherwise
exercise the rights of a shareholder with respect to securities of Issuer or any
of its Subsidiaries that may be acquired or controlled by Grantee or (ii) would
or would purport to entitle any Person to acquire securities of Issuer.

         (c) Amendment to Pride Rights Agreement. Issuer has amended or taken
other action under the Pride Rights Agreement so that neither the execution and
delivery of this Agreement or the issuance of Option Shares pursuant to an
exercise of the Option, will cause: (i) the Pride Rights to become exercisable
under the Pride Rights Agreement; (ii) the Grantee or any of Grantee's


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shareholders or Subsidiaries to be deemed an "Acquiring Person" (as defined in
the Pride Rights Agreement); (iii) any such event to be an event requiring an
adjustment of the purchase price of the Pride Rights under Section 11(a)(ii) of
the Pride Rights Agreement; (iv) Section 13 of the Pride Rights Agreement to be
or become applicable to any such event; or (v) a "Stock Acquisition Date" or a
"Distribution Date" (each as defined in the Pride Rights Agreement) to occur
upon any such event.

                                    ARTICLE 3

                    ADJUSTMENT UPON CHANGES IN CAPITALIZATION

         Section 3.1 Adjustment Upon Changes in Capitalization. In addition to
the adjustment in the number of shares of Issuer Common Stock that may be
purchased upon exercise of the Option pursuant to Section 1.1 of this Agreement,
the number of shares of Issuer Common Stock that may be purchased upon the
exercise of the Option and the Exercise Price shall be subject to adjustment
from time to time as provided in this Section 3.1. In the event of any change in
the number of issued and outstanding shares of Issuer Common Stock by reason of
any stock dividend, split-up, merger, recapitalization, combination, conversion,
exchange of shares, spin-off or other change in the corporate or capital
structure of Issuer which would have the effect of altering or otherwise
diminishing Grantee's rights hereunder, the number and kind of Option Shares or
other securities subject to the Option and the Exercise Price therefor shall be
appropriately adjusted so that Grantee shall receive upon exercise of the Option
(or, if such a change occurs between exercise and the Option Closing, upon the
Option Closing) the number and kind of shares or other securities or property
that Grantee would have received in respect of the Option Shares that Grantee is
entitled to purchase upon exercise of the Option if the Option had been
exercised (or the purchase thereunder had been consummated, as the case may be)
immediately prior to such event or the record date for such event, as
applicable. The rights of Grantee under this Section shall be in addition to,
and shall in no way limit, its rights against Issuer for breach of or the
failure to perform any provision of the Merger Agreement.

                                    ARTICLE 4

                               REGISTRATION RIGHTS

         Section 4.1 Registration of Option Shares Under the Securities Act. (a)
If requested by Grantee at any time and from time to time within one year after
receipt by Grantee of Option Shares (the "Registration Period"), Issuer shall
use its reasonable best efforts, as promptly as practicable, to effect the
registration under the Securities Act and any applicable state law (a "Demand
Registration") of such number of Option Shares or such other Issuer securities
owned by or issuable to Grantee in accordance with the method of sale or other
disposition contemplated by Grantee, including a "shelf" registration statement
under Rule 415 of the Securities Act or any successor provision, and to obtain
all consents or waivers of other parties that are required therefor. Grantee
agrees to use reasonable best efforts to cause, and to use reasonable best
efforts to cause any

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underwriters of any sale or other disposition to cause, any sale or other
disposition pursuant to such registration statement to be effected on a widely
distributed basis so that upon consummation thereof no purchaser or transferee
will own beneficially more than 5% of the then-outstanding voting power of
Issuer. With respect to such a "shelf" registration statement, Issuer shall keep
such Demand Registration effective for a period of not less than one year,
unless, in the written opinion of counsel to Issuer, which opinion shall be
delivered to Grantee and which shall be satisfactory in form and substance to
Grantee and its counsel, such registration under the Securities Act is not
required in order to lawfully sell and distribute such Option Shares or other
Issuer securities in the manner contemplated by Grantee. Except with respect to
such a "shelf" registration statement, Issuer shall keep such Demand
Registration effective for a period of not less than 150 days, unless, in the
written opinion of counsel to Issuer, which opinion shall be delivered to
Grantee and which shall be satisfactory in form and substance to Grantee and its
counsel, such registration under the Securities Act is not required in order to
lawfully sell and distribute such Option Shares or other Issuer securities in
the manner contemplated by Grantee. Issuer shall only have the obligation to
effect two Demand Registrations pursuant to this Section 4.1; provided that only
requests relating to a registration statement that has become effective under
the Securities Act shall be counted for purposes of determining the number of
Demand Registrations made. Issuer shall be entitled to postpone for up to 100
days from receipt of Grantee's request for a Demand Registration the filing of
any registration statement in connection therewith if the Board of Directors of
Issuer determines in its good faith reasonable judgment that such registration
would materially interfere with or require premature disclosure of, any material
acquisition, reorganization, pending or proposed offering of Issuer Securities
or other transaction involving Issuer or any other material contract under
active negotiation by Issuer; and provided further that Issuer shall not have
postponed any Demand Registration pursuant to this sentence during the twelve
month period immediately preceding the date of delivery of Grantee's request for
a Demand Registration.

         (b) If Issuer effects a registration under the Securities Act of Issuer
Common Stock for its own account or for any other stockholders of Issuer (other
than on Form S-4 or Form S-8, or any successor form), Grantee shall have the
right to participate in such registration and include in such registration the
number of shares of Issuer Common Stock or such other Issuer securities as
Grantee shall designate by notice to Issuer (an "Incidental Registration" and,
together with a Demand Registration, a "Registration"); provided, however, that,
if the managing underwriters of such offering advise Issuer in writing that in
their opinion the number of shares of Issuer Common Stock or other securities
requested to be included in such Incidental Registration exceeds the number
which can be sold in such offering, Issuer shall include therein (i) first, all
shares proposed to be included therein by Issuer, (ii) second, subject to the
rights of any other holders of registration rights in effect as of the date
hereof, the shares requested to be included therein by Grantee and (iii) third,
shares proposed to be included therein by any other stockholder of Issuer.
Participation by Grantee in any Incidental Registration shall not affect the
obligation of Issuer to effect Demand Registrations under this Section 4.1.
Issuer may withdraw any registration under the Securities Act that gives rise to
an Incidental Registration without the consent of Grantee.


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         (c) In connection with any Registration pursuant to this Section 4.1,
(i) Issuer and Grantee shall provide each other and any underwriter of the
offering with customary representations, warranties, covenants, indemnification
and contribution obligations in connection with such Registration, and (ii)
Issuer shall use reasonable best efforts to cause any Option Shares included in
such Registration to be approved for listing on the NYSE or any other nationally
recognized exchange or trading system upon which Issuer's securities are then
listed, subject to official notice of issuance, which notice shall be given by
Issuer upon issuance. Grantee will provide all information reasonably requested
by Issuer for inclusion in any registration statement to be filed hereunder. The
costs and expenses incurred by issuer in connection with any Registration
pursuant to this Section 4.1 (including any fees related to qualifications under
Blue Sky Laws and SEC filing fees) (the "Registration Expenses") shall be borne
by Issuer, excluding legal fees of Grantee's counsel and underwriting discounts
or commissions with respect to Option Shares to be sold by Grantee included in a
Registration.

         Section 4.2 Transfers of Option Shares. The Option Shares may not be
sold, assigned, transferred, or otherwise disposed of except (i) in an
underwritten public offering as provided in Section 4.1 or (ii) to any purchaser
of transferee who would not, to the knowledge of the Grantee after reasonable
inquiry, immediately following such sale, assignment, transfer or disposal
beneficially own more than 5% of the then-outstanding voting power of the
Issuer; provided, however, that Grantee shall be permitted to sell any Option
Shares if such sale is made pursuant to a tender or exchange offer that has been
approved or recommended by a majority of the members of the Board of Directors
of Issuer (which majority shall include a majority of directors who were
directors as of the date hereof).

                                    ARTICLE 5

                      REPURCHASE RIGHTS; SUBSTITUTE OPTIONS

         Section 5.1 Repurchase Rights. (a) Subject to Section 6.1, at any time
on or after the Exercise Date and prior to the Expiration Date, or, if the
Option has been exercised prior to the Expiration Date, for 120 days after the
Expiration Date, Grantee shall have the right (the "Repurchase Right") to
require Issuer to repurchase from Grantee (i) the Option or any part thereof as
Grantee shall designate at a price (the "Option Repurchase Price") equal to the
amount, subject to reduction at the sole discretion of Grantee pursuant to
clause (iii) of Section 6.1(a), by which (A) the Market/Offer Price (as defined
below) exceeds (B) the Exercise Price, multiplied by the number of Option Shares
as to which the Option is to be repurchased and/or (ii) such number of Option
Shares purchased by Grantee as Grantee shall designate at a price (the "Option
Share Repurchase Price") equal to the Market/Offer Price multiplied by the
number of Option Shares so designated. The term "Market/Offer Price" shall mean
the highest of (i) the highest price per share of Issuer Common Stock offered or
paid in any Pride Acquisition Proposal, or (ii) the highest closing price for
shares of Issuer Common Stock during the six-month period immediately preceding
the date Grantee gives the Repurchase Notice (as hereinafter defined). In
determining the Market/Offer Price, the value of consideration other than cash
shall be determined by a nationally recognized


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investment banking firm selected by Grantee and reasonably acceptable to Issuer,
which determination, absent manifest error, shall be conclusive for all purposes
of this Agreement.

         (b) Grantee shall exercise its Repurchase Right by delivering to Issuer
written notice (a "Repurchase Notice") stating that Grantee elects to require
Issuer to repurchase all or a portion of the Option and/or the Option Shares as
specified therein. The closing of the Repurchase Right (the "Repurchase
Closing") shall take place in the United States at the place, time and date
specified in the Repurchase Notice, which date shall not be less than two
business days nor more than ten business days from the date on which the
Repurchase Notice is delivered. At the Repurchase Closing, subject to the
receipt of a writing evidencing the surrender of the Option and/or certificates
representing Option Shares, as the case may be, Issuer shall deliver to Grantee
the Option Repurchase Price therefor or the Option Share Repurchase Price
therefor, as the case may be, or the portion thereof that Issuer is not then
prohibited under applicable Law from so delivering. At the Repurchase Closing,
(i) Issuer shall pay to Grantee the Option Repurchase Price for the portion of
the Option which is to be repurchased or the Option Shares Repurchase Price for
the number of Option Shares to be repurchased, as the case may be, by wire
transfer of immediately available funds to an account specified by Grantee at
least 24 hours prior to the Repurchase Closing and (ii) if the Option is
repurchased only in part, Issuer and Grantee shall execute and deliver an
amendment to this Agreement reflecting the Option Shares for which the Option is
not being repurchased.

         (c) To the extent that Issuer is prohibited under applicable Law from
repurchasing the portion of the Option or the Option Shares designated in such
Repurchase Notice, Issuer shall immediately so notify Grantee and thereafter
deliver, from time to time, to Grantee the portion of the Option Repurchase
Price and the Option Share Repurchase Price, respectively, that it is no longer
prohibited from delivering, within five Business Days after the date on which
Issuer is no longer so prohibited; provided, however, that if Issuer at any time
after delivery of a Repurchase Notice is prohibited under applicable Law from
delivering to Grantee the full amount of the Option Repurchase Price and the
Option Share Repurchase Price for the Option or Option Shares to be repurchased,
respectively, Grantee may rescind the exercise of the Repurchase Right, whether
in whole, in part or to the extent of the prohibition, and, to the extent
rescinded, no part of the amounts, terms or the rights with respect to the
Option or Repurchase Right shall be changed or affected as if such Repurchase
Right were not exercised. Issuer shall use its reasonable best efforts to obtain
all required regulatory and legal approvals and to file any required notices to
permit Grantee to exercise its Repurchase Right and shall use its reasonable
best efforts to avoid or cause to be rescinded or rendered inapplicable any
prohibition on Issuer's repurchase of the Option or the Option Shares.

         Section 5.2 Substitute Option. (a) In the event that Issuer enters into
an agreement (i) to consolidate with or merge into any Person, other than
Grantee, any Subsidiary of Grantee or the Company (each an "Excluded Person"),
and Issuer is not the continuing or surviving corporation of such consolidation
or merger, (ii) to permit any Person, other than an Excluded Person, to merge
into Issuer and Issuer shall be the continuing or surviving or acquiring
corporation, but, in connection with such merger, the then outstanding shares of
Issuer Common Stock shall be changed into or

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exchanged for stock or other securities of any other Person or cash or any other
property or the then outstanding shares of Issuer Common Stock shall after such
merger represent less than 50% of the outstanding voting securities of the
merged or acquiring company, or (iii) to sell or otherwise transfer all or
substantially all of its assets to any Person, other than an Excluded Person,
then, and in each such case, the agreement governing such transaction shall make
proper provision so that, unless earlier exercised by Grantee, the Option shall,
upon the consummation of any such transaction and upon the terms and conditions
set forth herein, be converted into, or exchanged for, an option with identical
terms appropriately adjusted to acquire the number and class of shares or other
securities or property that Grantee would have received in respect of Issuer
Common Stock if the Option had been exercised immediately prior to such
consolidation, merger, sale, or transfer, or the record date therefor, as
applicable and make any other necessary adjustments; provided, however, that if
such a conversion or exchange cannot, because of applicable Law be the same as
the Option, such terms shall be as similar as possible and in no event less
advantageous to Grantee than the Option.

         (b) In addition to any other restrictions or covenants, Issuer agrees
that it shall not enter or agree to enter into any transaction described in
Section 5.2(a) unless the Acquiring Corporation (as hereinafter defined) and any
Person that controls the Acquiring Corporation assume in writing all the
obligations of Issuer hereunder and agree for the benefit of Grantee to comply
with this Article V.

         (c) For purposes of this Section 5.2, the term "Acquiring Corporation"
shall mean (i) the continuing or surviving person of a consolidation or merger
with Issuer (if other than Issuer), (ii) Issuer in a consolidation or merger in
which Issuer is the continuing or surviving or acquiring Person, and (iii) the
transferee of all or substantially all of Issuer's assets.

                                    ARTICLE 6

                                  MISCELLANEOUS

         Section 6.1 Total Profit. (a) Notwithstanding any other provision of
this Agreement, in no event shall Grantee's Total Profit (as hereinafter
defined) exceed $50.0 million (the "Limitation Amount") and, if the total amount
that would otherwise be received by Grantee otherwise would exceed such amount,
Grantee, at its sole election, shall either (i) reduce the number of shares of
Issuer Common Stock subject to this Option, (ii) deliver to issuer for
cancellation Option Shares previously purchased by Grantee, (iii) reduce the
amount of the Option Repurchase Price or the Option Share Repurchase Price, (iv)
reduce the fee payable to Grantee pursuant to Section 9.5(b)(i) of the Merger
Agreement, (v) pay cash to Issuer, or (vi) any combination thereof, so that
Grantee's actually realized Total Profit, shall not exceed the Limitation Amount
after taking into account the foregoing actions.

         (b) Notwithstanding any other provision of this Agreement, the Option
may not be exercised for a number of Option Shares as would, as of the date of
exercise, result in a Notional

                                       10
<PAGE>   11

Total Profit (as defined below) which would exceed the Limitation Amount;
provided, that nothing in this sentence shall restrict any exercise of the
Option permitted hereby on any subsequent date.

         (c) As used herein, the term "Total Profit" shall mean the aggregate
amount (before taxes) of the following: (i) the amount received by Grantee
pursuant to Issuer's repurchase of the Option (or any portion thereof) pursuant
to Section 5.1, (ii) (x) the amount received by Grantee pursuant to Issuer's
repurchase of Option Shares pursuant to Section 5.1, less (y) Grantee's purchase
price for such Option Shares, (iii) (x) the net cash amounts or the fair market
value of any property received by Grantee pursuant to any consummated
arm's-length sales of Option Shares (or any other securities into which such
Option Shares are converted or exchanged) to any unaffiliated party, less (y)
Grantee's purchase price of such Option Shares and (iv) the amount received by
Grantee pursuant to Section 9.5(b)(i) of the Merger Agreement.

         (d) As used herein, the term "Notional Total Profit" with respect to
any number of Option Shares as to which Grantee may propose to exercise the
Option shall be the Total Profit determined as of the date of such proposal
assuming that the Option was exercised on such date for such number of Option
Shares and assuming that such Option Shares, together with all other Option
Shares held by Grantee and its affiliates as of such date, were sold for cash at
the closing market price (less customary brokerage commissions) for shares of
Issuer Common Stock on the preceding trading day on the NYSE (or on any other
nationally recognized exchange or trading system on which shares of Issuer
Common Stock are then so listed or traded).

         Section 6.2 Further Assurances; Listing. (a) From time to time, at the
other party's request and without further consideration, each party hereto shall
execute and deliver such additional documents and take all such further action
as may be necessary or desirable to consummate the transactions contemplated by
this Agreement, including, without limitation, to vest in Grantee good and
marketable title, free and clear of all Liens, to any Option Shares purchased
hereunder. Issuer agrees not to avoid or seek to avoid (whether by charter
amendment or through reorganization, consolidation, merger, issuance of rights
or securities, the Pride Rights Agreement or similar agreement, dissolution or
sale of assets, or by any other voluntary act) the observance or performance of
any of the covenants, agreements or conditions to be observed or performed
hereunder by it.

         (b) If the Issuer Common Stock or any other securities to be acquired
upon exercise of the Option are then listed on the NYSE (or any other national
securities exchange or trading system), Issuer, upon the request of Grantee,
will promptly file an application to list the shares of Issuer Common Stock or
such other securities to be acquired upon exercise of the Option on the NYSE
(and any other national securities exchange or trading system) and will use
reasonable best efforts to obtain approval of such listing as promptly as
practicable.

         Section 6.3 Division of Option; Lost Options. The Agreement (and the
Option granted hereby) are exchangeable, without expense, at the option of
Grantee, upon presentation and surrender of this Agreement at the principal
office of Issuer, for other agreements providing for Options of different
denominations entitling Grantee to purchase, on the same terms and subject to
the same

                                       11
<PAGE>   12

conditions as are set forth herein, in the aggregate the same number of Option
Shares purchasable hereunder. Upon receipt by Issuer of evidence reasonably
satisfactory to it of the loss, theft or destruction or mutilation of this
Agreement, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Agreement, if mutilated, Issuer will execute and deliver a new agreement of like
tenor and date.

         Section 6.4 Amendment. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.

         Section 6.5 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed duly given (a) on the date of delivery
if delivered personally, or by telecopy or telefacsimile, upon confirmation of
receipt, (b) on the first Business Day following the date of dispatch if
delivered by a recognized next-day courier service, or (c) on the tenth Business
Day following the date of mailing if delivered by registered or certified mail,
return receipt requested, postage prepaid. All notices hereunder shall be
delivered as set forth below, or pursuant to such other instructions as may be
designated in writing by the party to receive such notice:

         (a)      if to Grantee to:

                  Marine Drilling Companies, Inc.
                  One Sugar Creek Center Boulevard,
                  Suite 600
                  Sugar Land, Texas  77489
                  Attention:  Jan Rask
                  Facsimile:  (281) 243-3070

                  with a copy to:

                  Porter & Hedges, L.L.P.
                  700 Louisiana, Suite 3500
                  Houston, Texas 77002
                  Attention:  Nick D. Nicholas
                  Facsimile:  (713) 226-0237

         (b)      if to Issuer to:

                  Pride International, Inc.
                  5845 San Felipe, Suite 3300
                  Houston, Texas  77057
                  Attention:  Robert Randall
                  Facsimile:  (713) 952-6916


                                       12
<PAGE>   13


                  with a copy to:

                  Baker Botts L.L.P.
                  One Shell Plaza
                  910 Louisiana
                  Houston, Texas  77002-4995
                  Attention:  L. Proctor Thomas
                  Facsimile:  (713) 229-7785

         Section 6.6 Interpretation. When a reference is made in this Agreement
to Articles, Sections, Exhibits or Schedules, such reference shall be to an
Article or Section of or Exhibit or Schedule to this Agreement unless otherwise
indicated. The headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement. Whenever the words "include," "includes" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation."

         Section 6.7 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other party, it being understood that both
parties need not sign the same counterpart.

         Section 6.8 Entire Agreement; No Third Party Beneficiaries. (a) This
Agreement and the other agreements of the parties referred to herein constitute
the entire agreement and supersede all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof.

         (b) This Agreement shall be binding upon and inure solely to the
benefit of each party hereto, and nothing in this Agreement, express or implied,
is intended to or shall confer upon any other Person any right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.

         Section 6.9 Governing Law. This Agreement shall be governed and
construed in accordance with the laws of the State of Texas (without giving
effect to choice of law principles thereof).

         Section 6.10 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order

                                       13
<PAGE>   14

that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.

         Section 6.11 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto, in whole or in part (whether by operation of law or otherwise), without
the prior written consent of the other party, and any attempt to make any such
assignment without such consent shall be null and void. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and be
enforceable by the parties and their respective successors and assigns.

         Section 6.12 Submission to Jurisdiction; Waivers. Each of Grantee and
Issuer hereby (i) consents to submit itself to the personal jurisdiction of any
Texas state court sitting in Harris County, Texas or any Federal court located
in the Southern District of Texas, Houston, Division in the event any dispute
arises out of this Agreement or any of the transactions contemplated herein,
(ii) agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such court, and (iii)
agrees that it will not bring any action relating to this Agreement or any of
the transactions contemplated herein in any court other than any Texas state
court or any Federal court sitting in the Southern District of Texas, Houston
Division, and (iv) waives any right to trial by jury with respect to any action
related to or arising out of this Agreement or any of the transactions
contemplated herein.

         Section 6.13 Enforcement. The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms. It is accordingly agreed that
the parties shall be entitled to specific performance of the terms hereof, this
being in addition to any other remedy to which they are entitled at law or in
equity.

         Section 6.14 Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of any party hereto in the exercise of any right
hereunder will impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor will any single or partial exercise of any such right preclude other or
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement are cumulative to, and not exclusive to, and not exclusive
of, any rights or remedies otherwise available.

                            [SIGNATURE PAGE FOLLOWS]

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<PAGE>   15


         IN WITNESS WHEREOF, Grantee and Issuer have caused this Agreement to be
duly executed as of the date first above written.


                                 ISSUER:

                                 PRIDE INTERNATIONAL, INC.



                                 By:  /s/  Paul A. Bragg
                                    --------------------------------------------
                                    Name:  Paul A. Bragg
                                    Title: President and Chief Executive Officer



                                 GURANTEE:

                                 MARINE DRILLING COMPANIES, INC.



                                 By:  /s/  Jan Rask
                                    --------------------------------------------
                                    Name:  Jan Rask
                                    Title: President and Chief Executive Officer





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