Mail Stop 7010
July 12, 2005
via U.S. mail and Facsimile
Victor M. Perez
Chief Financial Officer
Allis-Chalmers Energy Inc.
5075 Westheimer, Suite 890
Houston, Texas 77056
Re: Allis-Chalmers Energy Inc.
Form S-1 filed June 24, 2005
File No. 333-126110
Dear Mr. Perez:
We have limited our review of your filing to those issues we
have addressed in our comments. Where indicated, we think you
should
revise your document in response to these comments. If you
disagree,
we will consider your explanation as to why our comment is
inapplicable or a revision is unnecessary. Please be as detailed
as
necessary in your explanation. In some of our comments, we may
ask
you to provide us with supplemental information so we may better
understand your disclosure. After reviewing this information, we
may
raise additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We
look forward to working with you in these respects. We welcome
any
questions you may have about our comments or on any other aspect
of
our review. Feel free to call us at the telephone numbers listed
at
the end of this letter.
Form S-1 filed June 24, 2005
Risk Factors, page 7
1. Please add risk factor disclosure regarding the downward
pressure
on the market price of your common stock that could result as the
selling shareholders exercise options and warrants and the
underwriter
exercises warrants and sells material amounts of your common
stock.
In addition, please discuss the fact that this downward pressure
could
encourage holders of your stock to engage in short sales.
Finally,
please explain short selling and its likely impact on the market
price
of your common stock or provide a cross-reference to the section
in
which you include such a discussion.
Transactions with Selling Stockholders and Other Related Parties,
page
53
2. Please revise to state the exemption relied upon in each
issuance
of securities described in this section.
Transactions with Selling Stockholders and Other Related Parties,
page
53
Sales of Common Stock to Selling Stockholders, page 53
3. We note the statement in the last paragraph of this section
that
Wells Fargo Energy Capital, Inc. is a selling stockholder;
however, it
does not appear that Wells Fargo Energy Capital has been listed in
the
selling stockholder table. Please revise accordingly.
Principal and Selling Stockholders, page 57
4. Please tell us whether any of the selling stockholders are a
broker-dealer or an affiliate of broker-dealer. If any selling
stockholder is a registered broker-dealer, it should be named as
an
underwriter. If the selling stockholder is an affiliate of a
registered broker-dealer, expand the prospectus to indicate
whether it
acquired the securities to be resold in the ordinary course of
business. Also indicate whether at the time of the acquisition it
had
any agreements, understandings or arrangements with any other
persons,
either directly or indirectly, to dispose of the securities.
5. Revise the selling shareholder table to include a line that
shows
the total number of shares to be offered in this prospectus.
6. Please expand your disclosure on page 53 to describe in greater
detail Rule 144 under the Securities Act as it pertains to sales
of
your common stock.
Underwriting, page 61
7. Please allow us sufficient time to review your underwriting
agreement prior to requesting effectiveness.
8. Supplementally advise us whether the NASD is reviewing the
underwriter`s compensation and other arrangements. If the NASD
has
undertaken a review of the arrangements, be advised that your
registration statement cannot be declared effective until the NASD
has
completed its review and issues an opinion stating that it has no
objections.
9. We note the statement that Morgan Keegan & Company, Inc. will
purchase warrants to purchase shares of common stock and that it
will
exercise the warrants immediately; however, it does not appear
that
you have registered any warrants to be sold. Please advise. If
you
intend to register the sale or resale of warrants in this
registration
statement, please revise the prospectus accordingly and include a
section that provides a description of the warrants. Revise your
legality opinion to include an opinion regarding the legality of
the
warrants.
10. Please revise your disclosures to clarify whether the
executive
officers and directors agreement not to issue, sell, transfer or
dispose of any shares of common stock without the prior written
consent of Morgan Keegan pertains to shares registered for resale
in
this registration statement, shares held by the officers and
directors
not registered for resale, or both.
11. Revise this section to include a discussion of the effect of
Regulation M on the activities of the underwriter, selling
shareholders, any potential broker-dealers, or others
participating in
a distribution of the common shares.
12. If the underwriter will engage in any electronic offer, sale,
or
distribution of the shares, describe the procedures to us
supplementally, or confirm that the procedures will be identical
to
procedures reviewed by Division`s Office of Chief Counsel without
objection. Please also include a brief description of any
electronic
distribution in the filing.
Historical Financial Statements
13. Please provide updated unaudited interim financial statements
for
Delta Rental Services Inc. and Capcoil Tubing Services Inc. as of
March 31, 2005 and for the periods ended March 31, 2005 and 2004
in
accordance with Rule 3-05 of Regulation S-X.
Closing Comments
As appropriate, please amend your registration statement in
response to these comments. You may wish to provide us with
marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. Please
understand that we may have additional comments after reviewing
your
amendment and responses to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have
made.
Notwithstanding our comments, in the event the company
requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such
request,
acknowledging that:
? should the Commission or the staff, acting pursuant to
delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
? the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the company from its full responsibility for the adequacy
and
accuracy of the disclosure in the filing; and
? the company may not assert this action as a defense in any
proceeding initiated by the Commission or any person under the
federal
securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division
of Corporation Finance in connection with our review of your
filing or
in response to our comments on your filing.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the proposed public
offering of
the securities specified in the above registration statement. We
will
act on the request and, pursuant to delegated authority, grant
acceleration of the effective date.
We direct your attention to Rules 460 and 461 regarding
requesting acceleration of a registration statement. Please allow
adequate time after the filing of any amendment for further review
before submitting a request for acceleration. Please provide this
request at least two business days in advance of the requested
effective date.
You may contact Bret Johnson, Staff Accountant, at (202)
551-
3753 or Anne McConnell, Senior Staff Accountant, at (202) 551-3709
if
you have questions regarding comments on the financial statements
and
related matters. Please contact Tamara Brightwell, Staff
Attorney, at
(202) 551-3751 or me at (202) 551-3767 with any other questions.
Sincerely,
Jennifer Hardy
Branch Chief
cc: Joseph P. Bartlett, Esq.
Greenberg Glusker Fields Claman
Machtinger & Kinsella LLP
1900 Avenue of the Stars, Suite 2100
Los Angeles, California 90067
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Victor M. Perez
Allis-Chalmers Energy Inc.
July 12, 2005
Page 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010
DIVISION OF
CORPORATION FINANCE