PARKER DRILLING COMPANY (NYSE:PKD) Files An 8-K Entry into a Material Definitive Agreement

PARKER DRILLING COMPANY (NYSE:PKD) Files An 8-K Entry into a Material Definitive Agreement

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Item 1.01

Entry into Material Definitive Agreements.
Underwriting Agreements
On February 22, 2017, Parker Drilling Company (the Company)
entered into Underwriting Agreements (each, an Underwriting
Agreement and together the Underwriting Agreements) with Barclays
Capital Inc., as the sole underwriter (the Underwriter). to the
Underwriting Agreements, the Company agreed to (i) sell the
Underwriter an aggregate of 12,000,000 shares of the Companys
common stock, par value $0.16 2/3 per share (the Common Stock),
at a price to the public of $2.10 per share and (ii) sell the
Underwriter 500,000 shares of the Companys 7.25% Series A
Mandatory Convertible Preferred Stock, par value $1.00 (the
Mandatory Convertible Preferred Stock), with a liquidation
preference and a price to the public of $100 per share, in each
case in a registered offering under the Companys shelf
registration statement on Form S-3 (File No. 333-197977) filed
with the Securities and Exchange Commission under the Securities
Act of 1933, as amended (the Securities Act), as supplemented by
a prospectus supplement with respect to each offering. to the
respective Underwriting Agreements, the Company also granted the
Underwriter a 30 day option to purchase up to an additional
1,800,000 shares of Common Stock and an additional 75,000 shares
of Mandatory Convertible Preferred Stock, as applicable.
The Underwriting Agreements contain customary representations,
warranties and agreements of the parties, and customary
conditions to closing, obligations of the parties and termination
provisions. The Company has agreed to reimburse the Underwriter
for certain expenses, to indemnify the Underwriter against
certain liabilities, including liabilities under the Securities
Act, and to contribute to payments the Underwriter may be
required to make in respect of those liabilities.
The offerings are expected to close on February 27, 2017, subject
to customary closing conditions. The Company expects to use the
net proceeds of the offerings, including any net proceeds from
the exercise of the Underwriters options to purchase additional
shares, for general corporate purposes, which may include,
without limitation, working capital, capital expenditures,
acquisitions or the repayment, redemption or refinancing of a
portion of its indebtedness.
The Underwriter and certain of its affiliates are full service
financial institutions engaged in various activities, which may
include securities trading, commercial and investment banking,
financial advisory, investment management, investment research,
principal investment, hedging, financing and brokerage
activities. The Underwriter and certain of its affiliates have,
from time to time, performed, and may in the future perform,
various commercial and investment banking and financial advisory
services for the Company and its affiliates, for which they
received or may in the future receive customary fees and
expenses.
The foregoing description of the Underwriting Agreements is not
complete and is qualified in its entirety by reference to the
full text of the Underwriting Agreements, which are filed as
Exhibits 1.1 and 1.2 to this Current Report on Form 8-K.
Amendment to Credit Agreement
On February 21, 2017, the Company entered into the Fourth
Amendment to the Second Amended and Restated Credit Agreement
(the Fourth Amendment) with Bank of America N.A., as
administrative agent (in such capacity, the Administrative
Agent), the lenders party thereto and the subsidiary guarantors
thereunder. The Fourth Amendment amends the Second Amended and
Restated Credit Agreement dated as of January 26, 2015 among the
Company, the lenders party thereto from time to time, the
Administrative Agent, and the other parties thereto.
The Fourth Amendment, among other things, permits the sale and
issuance of certain equity interests of the Company, including
the Mandatory Convertible Preferred Stock, and permits the
Company to pay dividends on the Mandatory Convertible Preferred
Stock, up to certain aggregate amounts specified therein.
The above description of the Fourth Amendment is not complete and
is qualified in its entirety by reference to the full text of the
Fourth Amendment, which is filed as Exhibit 10.1 to this Current
Report on Form 8-K.
Item 3.03 Material Modification to Rights of Security Holders.
In connection with the offering of shares of its Mandatory
Convertible Preferred Stock to the registered offering
described in Item 1.01 above, on February 27, 2017, the Company
filed a Certificate of Designations (the Certificate of
Designations) with the Secretary of State of the State of
Delaware to establish the preferences, limitations and relative
rights of the Mandatory Convertible Preferred Stock. The
Certificate of Designations became effective upon filing.
Subject to certain exceptions, so long as any share of
Mandatory Convertible Preferred Stock remains outstanding, no
dividend or distribution shall be declared or paid on the
shares of the Companys Common Stock or any other class or
series of junior stock, and no Common Stock or any other class
or series of junior or parity stock shall be purchased,
redeemed or otherwise acquired for consideration by the Company
or any of its subsidiaries unless all accumulated and unpaid
dividends for all preceding dividend periods have been declared
and paid upon, or a sufficient sum of cash or number of shares
of the Companys Common Stock has been set apart for the payment
of such dividends upon, all outstanding shares of Mandatory
Convertible Preferred Stock.
Unless converted or redeemed earlier to the Certificate of
Designations, each share of Mandatory Convertible Preferred
Stock will convert automatically on March 31, 2020, into
between 41.4079 and 47.6190 shares of the Companys Common
Stock, subject to customary anti-dilution adjustments. The
number of shares of Common Stock issuable upon conversion will
be determined based on the average volume weighted average
price per share of the Companys Common Stock over the 20
consecutive trading day period beginning on, and including, the
23rd scheduled trading day immediately preceding the mandatory
conversion date. Dividends on the Mandatory Convertible
Preferred Stock will be payable on a cumulative basis when, as
and if declared by the Companys Board of Directors, at an
annual rate of 7.25% of the liquidation preference of $100 per
share, and may be paid in cash, or subject to certain
limitations, in shares of the Companys Common Stock or any
combination of cash and shares of the Companys Common Stock on
March 31, June 30, September 30 and December 31 of each year,
commencing on June 30, 2017 and ending on, and including, March
31, 2020.
In addition, upon the Companys voluntary or involuntary
liquidation, winding-up or dissolution, each holder of
Mandatory Convertible Preferred Stock will be entitled to
receive a liquidation preference in the amount of $100 per
share of the Mandatory Convertible Preferred Stock, plus an
amount equal to accumulated and unpaid dividends on the shares,
whether or not declared, to, but not including, the date fixed
for liquidation, winding-up or dissolution to be paid out of
the Companys assets available for distribution to the Companys
stockholders, after satisfaction of liabilities to the Companys
creditors and holders of shares of any senior stock and before
any payment or distribution is made to holders of junior stock
(including the Companys Common Stock).
The foregoing description of the Certificate of Designations
does not purport to be complete and is qualified in its
entirety by reference to the full text of the Certificate of
Designations, which is filed as Exhibit 3.1 to this Current
Report on Form 8-K and incorporated into this Item 3.03 by
reference. A copy of the form of certificate for the Mandatory
Convertible Preferred Stock is filed as Exhibit 4.1 to this
Current Report on Form 8-K and incorporated into this Item 3.03
by reference.
Item 5.03 Amendments to Articles of Incorporation or Bylaws;
Change in Fiscal Year.
On February 27, 2017, the Company filed the Certificate of
Designations with the Secretary of State of the State of
Delaware to establish the preferences, limitations and relative
rights of the Mandatory Convertible Preferred Stock. The
Certificate of Designations, which is filed as Exhibit 3.1 to
this Current Report on Form 8-K and incorporated into this Item
5.03 by reference, became effective upon filing. The
information set forth under Item 3.03 above is incorporated
into this Item 5.03 by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
1.1
Underwriting Agreement, dated February 22, 2017, by and
between Parker Drilling Company and Barclays Capital
Inc., as the sole underwriter, with respect to the
offering of Common Stock.
1.2
Underwriting Agreement, dated February 22, 2017, by and
between Parker Drilling Company and Barclays Capital
Inc., as the sole underwriter, with respect to the
offering of 7.25% Series A Mandatory Convertible
Preferred Stock.
3.1
Certificate of Designations of 7.25% Series A Mandatory
Convertible Preferred Stock of Parker Drilling Company,
dated February 27, 2017.
4.1
Form of Certificate for the 7.25% Series A Mandatory
Convertible Preferred Stock (included as Exhibit A to
Exhibit 3.1).
5.1
Opinion of Baker Botts L.L.P. relating to the Common
Stock.
5.2
Opinion of Baker Botts L.L.P. relating to the 7.25%
Series A Mandatory Convertible Preferred Stock.
10.1
Fourth Amendment to the Second Amended and Restated
Credit Agreement, dated February 21, 2017, among Parker
Drilling Company, as Borrower, Bank of America, N.A.,
as Administrative Agent and L/C Issuer, Wells Fargo
Bank, National Association, as Syndication Agent,
Barclays Bank PLC, as Documentation Agent, and the
other lenders and L/C issuers from time to time party
thereto.
23.1
Consent of Baker Botts L.L.P. (included in Exhibit
5.1).
23.2
Consent of Baker Botts L.L.P. (included in Exhibit
5.2).


About PARKER DRILLING COMPANY (NYSE:PKD)

Parker Drilling Company (Parker Drilling) is a provider of contract drilling, and drilling-related services and rental tools. The Company’s business consists of two business lines: drilling services and rental tools services. Its Rental Tools Services business includes its Rental Tools segment, and its Drilling Services business includes its U.S. (Lower 48) Drilling, and International & Alaska Drilling segments. The Company’s U.S. (Lower 48) Drilling segment provides drilling services with its Gulf of Mexico barge drilling rig fleet and through U.S. (Lower 48) based O&M services. Its International & Alaska Drilling segment provides drilling services, with Company-owned rigs, as well as through O&M contracts, and project related services. In its Rental Tools Services business, it provides rental equipment and services to exploration and production (E&P) companies, drilling contractors and service companies on land and offshore in the United States and select international markets.

PARKER DRILLING COMPANY (NYSE:PKD) Recent Trading Information

PARKER DRILLING COMPANY (NYSE:PKD) closed its last trading session 00.00 at 1.95 with 1,340,743 shares trading hands.

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