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): December 20, 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 December 20, 2004, the Registrant refinanced certain extensions of
credit outstanding under its Existing Credit Agreement, as defined in 2.01
below, (such extensions of credit consisting of $15.3 million in letters of
credit) by entering into a new credit agreement among the Registrant as the
borrower, certain banks parties thereto as lenders, Lehman Brothers, Inc., as
the arranger, and Bank of America, N.A., as the syndication agent and Lehman
Commercial Paper, Inc., as the administrative agent (the "Credit Agreement").
The obligations of the Registrant under the Credit Agreement are guaranteed by
substantially all of the Registrant's domestic subsidiaries, each of which has
executed a guarantee and collateral agreement as a subsidiary guarantor. The
Credit Agreement has a term of three years.
The Credit Agreement requires the banks to make extensions of credit to
the Registrant in the form of revolving credit loans and letters of credit up to
a maximum of $40 million, with a sub-limit of $25 million for letters of credit.
Any extension of credit in excess of $25 million is subject to the satisfaction
of a borrowing base calculation which is based on a percentage of eligible
accounts receivables and rental equipment of the Registrant and its subsidiary
guarantors.
At the option of the Registrant, revolving credit loans under the Credit
Agreement will bear interest at either the prime rate for base rate loans or the
Eurodollar base rate for Eurodollar loans, each as defined in the Credit
Agreement, plus an applicable margin, which shall be 1.50% for base rate loans
and 2.50% for Eurodollar rate loans, subject to adjustment as provided in the
Credit Agreement. As of the closing of the Credit Agreement on December 20,
2004, there were $15.3 million of letters of credit outstanding and no revolving
credit loans outstanding.
The extensions of credit under the Credit Agreement are secured by a
pledge of the stock of all the subsidiary guarantors, all receivables of the
Registrant and the subsidiary guarantors, and the inventory and equipment of
Quail Tools, L.P., a subsidiary guarantor.
The Credit Agreement includes customary affirmative and negative
covenants, such as limitations on the creation of new indebtedness and on
certain liens, restrictions on certain transactions and payments (including
payment of dividends) and maintenance of certain ratios and coverage tests. A
default under the Credit Agreement may be triggered by events such as a failure
to comply with financial covenants or other covenants, a failure to make
payments when due, a change in control of the Registrant or certain insolvency
proceedings. A default would permit the lenders to restrict the Registrant's
access to the Credit Agreement and to take possession of the collateral to
satisfy any outstanding loans or letters of credit.
Certain of the lenders under the Credit Agreement and/or their affiliates
have provided, from time to time, and may continue to provide, commercial
banking, investment banking, financial and other services to the Registrant
and/or its affiliates for which the Registrant and/or it affiliates have paid,
and expect to pay, customary fees.
The description set forth above is qualified in its entirety by the Credit
Agreement, a cop of which has been filed as an exhibit hereto.
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Item 1.02 Termination of a Material Definitive Agreement
In connection with the execution of the Credit Agreement, as noted in 1.01
above, on December 20, 2004, the Registrant had $15.3 million in letters of
credit and no loans outstanding under the existing credit agreement among the
Registrant, as the borrower, Lehman Brothers, Inc. and Deutsche Bank Securities,
Inc. as joint advisors, Deutsche Bank Securities, Inc., as syndication agent,
Bank of America, N.A., as documentation agent, Deutsche Bank Trust Company
Americas, as collateral agent, and Lehman Commercial Paper, Inc. as
administrative agent, dated October 10, 2003 (the "Existing Credit Agreement").
The Registrant terminated the Existing Credit Agreement effective as of the
closing of the Credit Agreement referenced in 1.01 above. The lenders have
agreed that all outstanding letters of credit under the Existing Credit
Agreement shall continue to be letters of credit under the Credit Agreement.
In connection with the termination of the Existing Credit Agreement, the
collateral agent has released the naval mortgage on certain barge drillings rigs
of the subsidiary guarantors in the United States.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The discussion of the Credit Agreement in Items 1.01 of this Current
Report on Form 8-K is incorporated by reference herein.
Item 3.03 Material Modification to Rights of Security Holders.
The Revolving Credit Agreement prohibits the Registrant from paying cash
dividends to its stockholders.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
The following exhibit is furnished herewith
99 Credit Agreement dated December 20, 2004
S I G N A T U R E
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has
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duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
PARKER DRILLING COMPANY
Dated: December 27, 2004 By: /s/ James W. Whalen
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James W. Whalen,
Senior Vice President and
CFO
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Exhibit Index
Exhibit No. Description
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99 Credit Agreement dated December 20, 2004
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