Mail Stop 7010
August 3, 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/A filed July 21, 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/A filed July 21, 2005
Summary, page 5 and Selected Financial Data, page 17
Non-GAAP Measure
1. Your current disclosures of the non-GAAP measure that you
present
do not fully comply with Item 10(e) of Regulation S-K. If you
continue to present a non-GAAP measure, please revise your
disclosures to fully comply with Item 10(e) and the related FAQ.
For
example, we note that your current disclosures:
* Do not always disclose the most comparable GAAP measure with
equal
or greater prominence;
* Adjust the measure you present for items in addition to what the
acronym suggests; and
* Do not fully comply with our response to question #8 in the FAQ,
including disclosing potential limitations.
Risk Factors, page 12
2. We note your response to prior comment number one. Please
revise
this risk factor to include the additional language proposed in
your
response.
Underwriting, page 63
3. We note your response to prior comment nine. Please disclose
the
exercise price of the warrants. In addition, state the exemption
to
be relied upon for the sale of the warrants to the underwriter, as
well as the exemption relied upon in exercising the warrants.
Exhibit 1.1
4. We note that section 11(iii) appears to include a market-out
provisions that, practically speaking, place the risk of the
success
of your offering on your company and results in the underwriter
participating on a "best efforts" basis. Please supplementally
explain to us how these provisions are consistent with a firm
commitment offering. For guidance, please refer to the First
Boston
Corporation no-action letter, dated September 3, 1985.
Potential Acquisition
5. After reviewing your responses dated July 13, 2005 and July 21,
2005, it appears to us that the potential acquisition from RPC is
probable in the context of FRC 506.02(c)(ii). Due to the stage of
the negotiations and the significance of the potential
acquisition,
we believe that the disclosures we requested in our letter dated
June
1, 2005 are necessary and should be provided in the current
registration statement on Form S-1. Please revise your proposed
disclosures to:
* Delete your assertion that the equipment has an indefinite life
and
disclose the weighted average useful life over which it would be
depreciated; and
* Disclose why the assets to be acquired are not a business.
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.
August 3, 2005
Page 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010
DIVISION OF
CORPORATION FINANCE