SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 2, 2004
PARKER DRILLING COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 1-7573 73-0618660
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
1401 Enclave Parkway, Suite 600
Houston, Texas 77077
(Address of principal executive offices, including zip code)
(281) 406-2000
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On September 2, 2004, Parker Drilling Company, a Delaware corporation (the
"Company"), entered into (i) an Indenture, dated as of September 2, 2004 (the
"Indenture"), among the Company, the guarantors named therein and JPMorgan Chase
Bank, as trustee; and (ii) a Registration Rights Agreement, dated as of
September 2, 2004 (the "Registration Rights Agreement"), among the Company, the
guarantors named therein, Lehman Brothers Inc. and Bank of America Securities
LLC. Copies of such agreements are attached hereto as Exhibits 10.1 and 10.2,
respectively. For a description of the Indenture and the Registration Rights
Agreement, see the information set forth below under Item 2.03, which is
incorporated by reference into this Item 1.01.
ITEM 2.03. CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN
OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT
On September 2, 2004, the Company issued $150,000,000 aggregate principal
amount of senior floating rate notes due 2010 (the "Notes") pursuant to the
Indenture. The Notes were sold within the United States only to qualified
institutional buyers in reliance on Rule 144A under the Securities Act of 1933,
as amended (the "Securities Act"), and outside the United States only to
non-U.S. persons in reliance on Regulation S under the Securities Act. The Notes
have not been registered under the Securities Act or any state securities laws,
and, unless so registered, may not be offered or sold in the United States
except pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and applicable state securities
laws.
The Notes will mature on September 1, 2010 and bear interest at a floating
rate equal to three-month LIBOR plus 4.75%. Interest on the Notes will be reset
quarterly and is payable on March 1, June 1, September 1 and December 1 of each
year, beginning on December 1, 2004.
If the Company experiences specified kinds of changes of control, the
Company must offer to repurchase the Notes at 101% of the principal amount of
the Notes, plus accrued and unpaid interest, if any, to the date of repurchase.
The Notes are general unsecured obligations of the Company. The Notes rank
equal in right of payment with all of the Company's existing and future senior
unsecured indebtedness.
The Notes are jointly and severally guaranteed by substantially all of the
Company's domestic subsidiaries.
The Company will not be required to make mandatory redemption or sinking
fund payments with respect to the Notes.
At any time prior to September 1, 2006, the Company may on any one or more
occasions redeem up to 35% of the aggregate principal amount of notes issued
under the Indenture at a redemption price of 100.00% of the principal amount,
plus a premium, with the proceeds of certain equity offerings. On and after
September 1, 2006, the Company may redeem all or a part
of the notes upon not less than 30 nor more than 60 days' notice, at redemption
prices (expressed as percentages of principal amount) equal to 102.00% for the
twelve-month period beginning on September 1, 2006, 101.00% for the twelve-month
period beginning on September 1, 2007 and 100.00% beginning on September 1,
2008, plus accrued and unpaid interest.
The Indenture restricts the Company's ability and the ability of certain
of its subsidiaries to: (i) sell assets; (ii) pay dividends or make other
distributions on capital stock or redeem or repurchase capital stock or
subordinated indebtedness; (iii) make investments; (iv) incur or guarantee
additional indebtedness; (v) create or incur liens; (vi) enter into sale and
leaseback transactions; (vii) incur dividend or other payment restrictions
affecting subsidiaries; (viii) merge or consolidate with other entities; (ix)
enter into transactions with affiliates; and (x) engage in certain business
activities. These covenants are subject to a number of important exceptions and
qualifications.
The Indenture provides that each of the following is an Event of Default:
(i) default for 30 days in the payment when due of interest on, or additional
interest with respect to, the Notes; (ii) default in payment when due of the
principal of, or premium, if any, on the Notes; (iii) failure by the Company or
any of its restricted subsidiaries to comply within specified time periods with
any of the other agreements in the Indenture; (iv) default under any mortgage,
indenture or instrument under which there may be issued or by which there may be
secured or evidenced any indebtedness for money borrowed by the Company or any
of its restricted subsidiaries (or the payment of which is guaranteed by the
Company or any of its restricted subsidiaries) whether such indebtedness or
guarantee now exists, or is created after the date notes are first issued, if
that default: (a) is caused by a failure to pay principal of, or interest or
premium, if any, on such indebtedness prior to the expiration of the grace
period provided in such indebtedness on the date of such default (a "Payment
Default"); or (b) results in the acceleration of such indebtedness prior to its
stated maturity, and, in each case, the principal amount of any such
indebtedness, together with the principal amount of any other such indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $15.0 million or more; (v) failure by the Company or
any of its subsidiaries to pay final judgments aggregating in excess of $15.0
million, which judgments are not paid, discharged or stayed for a period of 60
days; (vi) except as permitted by the Indenture, any subsidiary guarantee shall
be held in any judicial proceeding to be unenforceable or invalid or shall cease
for any reason (other than in accordance with the terms of that guarantee and
the indenture) to be in full force and effect or any guarantor, or any person
acting on behalf of any guarantor, shall deny or disaffirm its obligations under
its subsidiary guarantee; and (vii) certain events of bankruptcy or insolvency
described in the indenture with respect to the Company or any of its significant
subsidiaries or any group of restricted subsidiaries that, taken as a whole,
would constitute a significant subsidiary. In the case of an Event of Default
arising from certain events of bankruptcy or insolvency with respect to the
Company, all outstanding notes will become due and payable immediately without
further action or notice. If any other Event of Default occurs and is
continuing, the trustee or the holders of at least 25% in principal amount of
the then outstanding notes may declare all the notes to be due and payable
immediately.
Pursuant to the Registration Rights Agreement, the Company will file an
exchange offer registration statement within 90 days from September 2, 2004 with
respect to an offer to
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exchange the Notes for substantially identical notes that are registered under
the Securities Act. Additionally, the Company has agreed to use its commercially
reasonable best efforts to cause that registration statement to become effective
within 180 days from September 2, 2004. Under some circumstances, in lieu of a
registered exchange offer, the Company has agreed to file a shelf registration
statement with respect to the notes and to use its commercially reasonable best
efforts to keep the shelf registration statement effective until the earlier of
September 2, 2006 or the sale pursuant to the shelf registration statement of
all of the notes registered thereunder. The Company is required to pay
additional interest if it fails to comply with its obligations to register the
notes within the specified time periods
The Company used $70 million of the proceeds of the offering of the Notes
to repay all outstanding borrowings under the term loan portion of its existing
credit facility and used the balance of the net proceeds of the offering of the
Notes, together with cash on hand, to fund the cash tender offer for $80 million
of the Company's 10 1/8% senior notes due 2009.
The description set forth above is qualified it entirety by the Indenture
and the Registration Rights Agreement, which are filed herewith as exhibits.
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ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits. The following exhibit is filed herewith:
Exhibit No. Description
10.1 Indenture, dated September 2, 2004, among Parker Drilling Company, the
guarantors named therein and JPMorgan Chase Bank, as trustee.
10.2 Registration Rights Agreement, dated September 2, 2004, by and among
Parker Drilling Company, the guarantors named therein, Lehman Brothers
Inc. and Bank of America Securities LLC.
99.1 Press Release of Parker Drilling Company issued September 2, 2004
S I G N A T U R E
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PARKER DRILLING COMPANY
Dated: September 7, 2004 By: /s/ James W. Whalen
-----------------------------
James W. Whalen
Senior Vice President and
Chief Financial Officer
EXHIBIT INDEX
Exhibit
Number Description
10.1 Indenture, dated September 2, 2004, among Parker Drilling Company, the
guarantors named therein and JPMorgan Chase Bank, as trustee.
10.2 Registration Rights Agreement, dated September 2, 2004, by and among
Parker Drilling Company, the guarantors named therein, Lehman Brothers
Inc. and Bank of America Securities LLC.
99.1 Press Release of Parker Drilling Company issued September 2, 2004
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