<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
/ X / Quarterly report pursuant to Section 13 or 15(d)of the Securities
Exchange Act of 1934
For the quarterly period ended September 30, 1998
/ / Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Commission File No. 1-8726
RPC, INC.
(Exact name of registrant as specified in its charter)
Delaware 58-1550825
(State or other juridsiction (I.R.S. Employer
of incorporation or organization) Identification Number)
2170 Piedmont Road, NE, Atlanta, Georgia 30324
(Address of principal executive offices) (zip code)
Telephone Number -- (404) 321-2140
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
----- -----
As of September 30, 1998, RPC, Inc. had 28,971,872 shares of common stock issued
and outstanding.
1 of 11
<PAGE>
RPC, INC. AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 1998, AND DECEMBER 31, 1997
(In thousands except share information)
<TABLE>
<CAPTION>
September 30, December 31,
1998 1997
(Unaudited) (Audited)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Cash and cash equivalents $8,353 $17,409
Marketable securities 3,841 11,276
Accounts receivable, net of allowance for doubtful
accounts of $7,388 and $6,967, respectively 33,158 32,153
Inventories, at lower of cost or market 17,282 16,025
Deferred income taxes 9,504 8,626
Federal income taxes receivable 2,963 --
Prepaid expenses and other current assets 1,416 2,390
- --------------------------------------------------------------------------------------------------------------
Current assets 76,517 87,879
- --------------------------------------------------------------------------------------------------------------
Equipment and property, net 67,817 55,673
Marketable securities 30,689 29,499
Intangibles, net 7,625 8,289
Other assets 975 1,178
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
Total assets $183,623 $182,518
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $6,939 $7,437
Accrued payroll and related expenses 5,145 5,826
Accrued insurance expenses 5,793 7,422
Accrued state, local and other taxes 4,934 4,211
Federal income taxes payable -- 1,061
Accrued discounts 718 826
Current portion of long-term debt 589 857
Other accrued expenses 10,046 9,844
- --------------------------------------------------------------------------------------------------------------
Current liabilities 34,164 37,484
- -----------------------------------------------------------------------------------------------------------
Deferred income taxes 573 309
Long-term accrued insurance expenses 3,595 4,034
Long-term debt 804 1,315
- --------------------------------------------------------------------------------------------------------------
Total liabilities 39,136 43,142
- --------------------------------------------------------------------------------------------------------------
Commitments and contingencies
- --------------------------------------------------------------------------------------------------------------
Common stock 2,897 2,978
Capital in excess of par value 27,200 35,211
Earnings retained 114,390 101,805
Common stock in treasury, at cost, 0 shares
and 169,392 shares, respectively -- (618)
- --------------------------------------------------------------------------------------------------------------
Total stockholders' equity 144,487 139,376
- --------------------------------------------------------------------------------------------------------------
Total liabilities and stockholders' equity $183,623 $182,518
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these statements.
2 of 11
<PAGE>
RPC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 1998, AND 1997
(In thousands except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three months ended September 30, Nine months ended September 30,
-------------------------------- --------------------------------
1998 1997 1998 1997
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
Revenue $56,977 $57,856 $190,292 $183,092
- ----------------------------------------------------------------------------------------------------------------------------------
Cost of goods sold 20,405 17,191 68,236 64,574
Operating expenses 27,053 29,539 86,759 86,985
Depreciation and amortization 4,074 3,512 11,439 9,408
Interest income (610) (645) (1,653) (1,735)
- ----------------------------------------------------------------------------------------------------------------------------------
Income before income taxes 6,055 8,259 25,511 23,860
Income tax provision 2,302 2,850 9,694 8,232
- ----------------------------------------------------------------------------------------------------------------------------------
Net income $3,753 $5,409 $15,817 $15,628
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Earnings per share
Basic $0.13 $0.19 $0.54 $0.54
- ----------------------------------------------------------------------------------------------------------------------------------
Diluted $0.13 $0.18 $0.54 $0.53
- ----------------------------------------------------------------------------------------------------------------------------------
Average shares outstanding
Basic 29,030 29,186 29,110 29,092
- ----------------------------------------------------------------------------------------------------------------------------------
Diluted 29,387 29,937 29,507 29,469
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these statements.
3 of 11
<PAGE>
RPC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998, and 1997
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
Nine months ended September 30,
--------------------------------------
1998 1997
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES $16,765 $21,775
- -----------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (24,360) (16,904)
Proceeds from sale of equipment and property 3,132 1,932
Net sale (purchase) of marketable securities 6,245 (4,648)
Other 0 (1,048)
- -----------------------------------------------------------------------------------------------------------------------------
Net cash used for investing activities (14,983) (20,668)
- -----------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Dividend distributions (3,094) (736)
(Decrease) increase in long term debt, net of repayments (779) 1,760
Common stock purchased and retired (7,038) 0
Proceeds from exercise of stock options 73 249
- -----------------------------------------------------------------------------------------------------------------------------
Net cash (used for) provided by financing activities (10,838) 1,273
- -----------------------------------------------------------------------------------------------------------------------------
Net (decrease) increase in cash and cash equivalents (9,056) 2,380
Cash and cash equivalents at beginning of period 17,409 13,124
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of period $8,353 $15,504
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these statements.
4 of 11
<PAGE>
RPC, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. The consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. These
consolidated financial statements should be read in conjunction with
the financial statements and related notes contained in the Company's
annual report on Form 10-K for the fiscal year ended December 31, 1997.
In the opinion of management, the consolidated financial statements
included herein contain all adjustments necessary to present fairly the
financial position of the Company as of September 30, 1998, the results
of operations for the quarter and the nine months ended September 30,
1998 and 1997, and the cash flows for the nine months ended September
30, 1998 and 1997.
2. Basic and diluted earnings per share are computed by dividing net
income by the respective weighted average number of shares outstanding
during the respective periods.
3. The results of operations for the quarter ended September 30, 1998, are
not necessarily indicative of the results to be expected for the full
year.
4. In June 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 130, "Reporting Comprehensive
Income" (SFAS No. 130), which establishes standards for displaying
comprehensive income and its components in a full set of general
purpose financial statements. SFAS No. 130 is effective for fiscal
years beginning after December 15, 1997. The adoption of SFAS No. 130
does not have a material impact.
5. In June 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 131, "Disclosures about Segments
of an Enterprise and Related Information" (SFAS No. 131), which
establishes standards for reporting information about operating
segments in annual financial statements and requires reporting selected
information about operating segments in interim financial reports
issued to stockholders. SFAS No. 131 is effective for fiscal years
beginning after December 15, 1997.
5 of 11
<PAGE>
6. In June, 1998, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities" (SFAS No. 133), which
establishes standards for reporting and disclosing information about
derivative instruments. SFAS No. 133 is effective for fiscal years
beginning after June 15, 1999. The adoption of SFAS No. 133 is not
expected to have a material impact.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
THREE MONTHS ENDED SEPTEMBER 30, 1998, COMPARED TO THREE MONTHS
ENDED SEPTEMBER 30, 1997
Revenue for the third quarter ended September 30, 1998, was $56,977,000 compared
with $57,856,000 for the quarter ended September 30, 1997, a decrease of
$879,000 or 2%. The oil and gas services segment revenue of $30,633,000
decreased 14% from last year's third quarter of $35,512,000. This was due, in
large part, to decreased foreign activity, primarily in Venezuela due to the
reorganization of the Venezuelan national oil company, coupled with an overall
decrease in domestic activity. In addition, oil and natural gas prices have
decreased 24 and 26 percent, respectively, compared to the comparable period in
the prior year and the number of working rigs in the United States has decreased
approximately 25 percent from the third quarter of 1997. The third quarter oil
and gas services segment revenue was also negatively impacted by poor weather
conditions in the Gulf of Mexico and gulf states region. The powerboat
manufacturing segment revenue for the quarter ended September 30, 1998,
increased to $22,420,000 or 17% from last year's third quarter of $19,136,000 as
the result of an increase in Chaparral's market share.
Cost of goods sold for the third quarter ended September 30, 1998, was
$20,405,000 compared to $17,191,000 for the third quarter ended September 30,
1997, an increase of $3,214,000 or 19%. This increase is comparable to the
increase in sales for the third quarter for the powerboat manufacturing segment.
Net income for the quarter ended September 30, 1998, was $3,753,000 or $0.13
diluted earnings per share versus net income of $5,409,000 or $0.18 diluted
earnings per share for the quarter ended September 30, 1997. Basic earnings per
share was $0.13 cents per share versus $0.19 cents per share last year. The
decrease in earnings from the same period one year ago was due to the decreased
revenues coupled with decreased profit margins for the oil and gas services
segment offset to some extent by the increase in the profit margins for the
powerboat manufacturing segment.
6 of 11
<PAGE>
RPC, INC. AND SUBSIDIARIES
ITEM 2. CONT'D
NINE MONTHS ENDED SEPTEMBER 30, 1998 COMPARED TO NINE MONTHS
ENDED SEPTEMBER 30, 1997
Revenue for the nine months ended September 30, 1998 was $190,292,000 compared
with $183,092,000 for the nine months ended September 30, 1997, an increase of
$7,200,000 or 4%. The oil and gas services segment revenue decreased by less
than 1% and the powerboat manufacturing segment increased 7%. The oil and gas
services revenue has experienced a slight decrease for the nine months as a
result of the overall declines in drilling activity and decreased foreign
activity, primarily in Venezuela, due to the reorganization of the Venezuelan
national oil company. The powerboat manufacturing revenue increased due to
Chaparral's increased market share.
Cost of goods sold for the nine months ended September 30, 1998, was $68,236,000
compared to $64,574,000 for the third quarter ended September 30, 1997, an
increase of $3,662,000 or 6%. This increase is comparable to the increase in
sales for the nine months for the powerboat manufacturing segment.
Net income for the nine months ended September 30, 1998 was $15,817,000 or $0.54
diluted earnings per share versus net income of $15,628,000 or $0.53 diluted
earnings per share for the nine months ended September 30, 1997. Basic earnings
per share was $0.54 compared to $0.54 for the comparable period last year. The
increase in earnings from the same period one year ago was due to the overall
revenue increase coupled with the improved profit margins for both the oil and
gas services and the powerboat manufacturing segments, offset by an increase in
the effective income tax rate from 34.5% last year to 38% this year.
FINANCIAL CONDITION
The Company's current ratio remained strong as of September 30, 1998, with
current assets of $76,517,000 exceeding current liabilities of $34,164,000 by a
ratio of 2.2-to-1. This compares to a current ratio of 2.3-to-1 at December 31,
1997.
Capital expenditures during the first nine months of 1998 totaling $24,360,000
were primarily for revenue-producing equipment in the oil and gas services
segment. The remainder was spent on various purchases for the other business
segments. Funding for future capital requirements will be provided from
operations.
The Company is in the process of assessing the effect of Year 2000 on the
Company's operating plans and systems. The Company is developing a plan for
identifying,
7 of 11
<PAGE>
RPC, INC. AND SUBSIDIARIES
ITEM 2. CONT'D
renovating, testing and implementing its systems for Year 2000 processing and
internal control requirements. The Company is also in the process of developing
strategies for evaluating the risks associated with the Year 2000 issue with
respect to its major customers and suppliers. The cost of becoming Year 2000
compliant has not yet been determined; however, management feels such cost will
not be material to the Company's financial statements.
Management's discussion and analysis of results of operations and financial
condition include "forward looking statements" within the meaning of Section 27A
of the Securities Act of 1933, as amended (the "Securities Act"), Section 21E of
the Securities Exchange Act of 1934, as amended (the "Exchange Act") and the
Private Securities Litigation Reform Act of 1995. All statements, other than
statements of historical facts, included or incorporated by reference which
address activities, events or developments which the Company expects or
anticipates will or may occur in the future, including statements regarding
trends in the boating industry, and anticipated trends and similar expressions
concerning matters that are not historical facts, are forward-looking
statements.
These statements are based on certain assumptions and analyses made by the
Company in light of its experience and its perception of historical trends,
current conditions and expected future developments as well as other factors it
believes are appropriate in the circumstances. However, whether actual results
and developments will conform with the Company's expectations, including
economic conditions, conditions in the industries in which the Company operates,
competition, and other factors, many of which are beyond the control of the
Company. Consequently, all of the forward-looking statements made are qualified
by these cautionary statements and there can be no assurance that the actual
results or developments anticipated by the Company will be realized or, even if
substantially realized, that they will have the expected consequences to or
effects on the Company or its business or operations. The Company assumes no
obligation to update publicly any such forward-looking statements, whether as a
result of new information, future events, or otherwise.
ITEM 3. QUANTITATIVE & QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company has not entered into transactions or contracts which require
disclosure pursuant to this item.
8 of 11
<PAGE>
RPC, INC. AND SUBSIDIARIES
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
Appropriate proposals of stockholders intended to be presented at the Company's
1999 Annual Meeting of Stockholders pursuant to Rule 14a-8 promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), must be
received by the Company by December 2, 1998 for inclusion in its Proxy Statement
and form of proxy relating to that meeting. If the date of the 1999 Annual
Meeting is subsequently advanced or delayed by more than 30 calendar days from
the 1998 Annual Meeting, the Company shall, in a timely manner, inform its
stockholders of the change and the date by which such proposals of stockholders
must be received.
In addition, all stockholder proposals submitted outside of the stockholder
proposal rules promulgated pursuant to Rule 14a-8 under the Exchange Act must be
received by the Company by February 15, 1999 in order to be considered timely.
If such stockholder proposals are not timely received, proxyholders will have
discretionary voting authority with regard to any such stockholder proposals
which may come before the Annual Meeting. With regard to such stockholder
proposals, if the date of the 1999 annual meeting is subsequently advanced or
delayed by more than 30 days from the date of the 1998 Annual Meeting to which
the Proxy Statement relates, the Company shall, in a timely manner, inform
stockholders of the change and the date by which proposals must be received.
9 of 11
<PAGE>
RPC, INC. AND SUBSIDIARIES
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
(3)(1)(a) The Company's Certificate of Incorporation
(3)(1)(b) The Company's Certificates of Amendment of the Certificate
of Incorporation
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed or required to be filed during the
quarter ended September 30, 1998.
10 of 11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
RPC, INC.
/s/ Richard A. Hubbell
---------------------------------------------
Date: November 13, 1998 Richard A. Hubbell
President and Chief Operating Officer
/s/ Ben M. Palmer
---------------------------------------------
Date: November 13, 1998 Ben M. Palmer
Vice President, Treasurer and Chief Financial
Officer
11 of 11
<PAGE>
Exhibit (3)(1)(a) RPC's Certificate of Incorporation
<PAGE>
CERTIFICATE OF INCORPORATION
OF
RPC ENERGY SERVICES, INC.
The undersigned, acting as incorporator of a corporation under the General
Corporation Law of Delaware, adopts the following Certificate of Incorporation
for such corporation:
FIRST. The names of this corporation is RPC Energy Services, Inc.
SECOND: Its registered office in the State of Delaware is located at
No. 100 West Tenth street, in the city of Wilmington, County of New Castle,
and the name of its registered agent at such address in charge thereof is The
Corporation Trust Company.
THIRD. The nature of the business and the objects and purposes to be
transacted, promoted and carried on are to do any or all of the things herein
mentioned as fully and to the same extent as natural persons might or could do,
and in any part of the world, viz.:
To carry on business in the United States or elsewhere as consignees,
factors, agents, commission merchants or merchants to buy, sell, manipulate and
deal in at wholesale or retail, drilling muds, chemicals, cements, and/or other
additives used by or in connection with the business of exploring, mining,
drilling for oil, gas, sulphur, liquid and gaseous hydrocarbons and other
minerals. To purchase, acquire, or dispose of, construct, lease, maintain and
operate in this state and elsewhere, factories, plants, machinery, equipment,
supplies, warehouses, trucks, tugs, barges, ships, or marsh equipment which may
be necessary, convenient or incidental to engage in the business of oil field
drilling.
To engage in the general manufacturing (or contracting) business and
especially the business of designing, building and erecting barges, boats, tugs,
ships, or vessels, marsh equipment, including but not limited to marsh buggies,
sleds, tractors, and plows; to engage in the general building business and to
obtain, buy, sell, lease or otherwise deal in patents, patent rights, equipment,
engines, and machinery of all kinds; to acquire, purchase, construct,
manufacture, fabricate, process and prepare in any fashion whatsoever all of the
above named or any other buildings, machines, machinery, equipment, in any and
all manners, methods or ways whatsoever, whether now in existence or hereafter
conceived, patented, developed or devised.
To search for, explore, mine, drill and otherwise seek oil, gas, sulphur,
liquid ad gaseous hydrocarbons and other minerals in any manner whatsoever,
either for its own account as owners, mineral owners or lessees, or for the
account of others under contracts or otherwise, and generally do all and
everything necessary, desirable or proper in connection with the exploration for
or production of oil, gas and other minerals.
To purchase, construct, devise, maintain, operate, lease, lend or borrow oil
and gas well machinery, equipment, rigs, derricks, barges, dredges, boats,
mining machinery and equipment of any nature or kinds, whether now in existence
or hereafter devised, designed or invented;
<PAGE>
To refine, distill, or otherwise process oil, gas and all other minerals in
any fashion whatsoever, either by contract or by construction, operation and
maintenance of refineries, distilling units or other plants, factories or
methods, whether now in existence of hereafter conceived, developed, patented or
devised.
To engage in the leasing, rental, handling and servicing of pipe, equipment
and tools used by drilling contractors and oil and gas companies, and in
connection therewith, to invent, design, develop, exploit, improve, alter,
manufacture, fabricate, assemble, install, repair, service, maintain, buy, sell,
import, export, license as licensor or licensee, lease as lessor or lessee,
distribute, job, enter into, negotiate, execute, acquire, receive, obtain, hold,
grant, assign, and transfer contracts, selling rights, licensing arrangements,
options, franchises, and other rights, in respect of, and generally deal in and
with, at wholesale and retail, as agent, representative, broker, merchant,
distributor, jobber, advisor, or in any other lawful capacity, goods, wares,
merchandise, commodities, and unimproved, improved, finished, processed, and
other real, personal, and mixed property of any and all kinds, and without
limiting the generality of the foregoing, oil field, pipe line and refinery
tools, dies, instruments, machinery, appliances, devices, accessories, and
related and unrelated products and objects of all kinds, together with the
components thereof, and machines, facilities, devices, supplies and equipment
for fabricating, preparing, sharpening, repairing, altering, and producing oil
field, pipe line and refinery tools, dies, instruments, machinery, appliances,
devised, accessories, and related and unrelated products and objects of all
kinds.
To engage in and conduct the business of swabbing, to remove fluids and
solids from well bores to stimulate the natural flow of oil and to provide
related services necessary to appropriate to the general business of the
corporation.
To engage in the oil services industry generally and to work with all
materials, machinery, implements and articles necessary or appropriate thereto.
To purchase, take, own, hold, deal in, mortgage or otherwise lien and to
lease, sell, exchange, convey, transfer or in any manner whatsoever dispose of
real property, within or without the State of Delaware.
To manufacture, purchase or otherwise acquire and to hold, own, mortgage or
otherwise lien, pledge, lease, sell, assign, exchange, transfer or in any manner
dispose of, and to invest, deal and trade in and with goods, wares, merchandise
and personal property of any and every class and description, within or without
the State of Delaware.
To acquire the good will, rights and property and to undertake the whole or
any part of the assets and liabilities of any person, firm, association or
corporation; to pay for the same in cash, the stock of this company, bonds or
otherwise; to hold or in any manner to dispose of the whole or any part of the
property so purchased; to conduct in any lawful manner the whole or any part of
any business so acquired and to exercise all the powers necessary or convenient
in and about the conduct and management of such business.
<PAGE>
To guarantee, purchase or otherwise acquire, hold, sell, assign, transfer,
mortgage, pledge or otherwise dispose of shares of the capital stock, bonds or
other evidences of indebtedness created by other corporations and while the
holder of such stock to exercise all the rights and privileges of ownership,
including the right to vote thereon, to the same extent as a natural person
might or could do.
To purchase or otherwise acquire, apply for, register, hold, use, sell or in
any manner dispose of and to grant licenses or other rights in and in any manner
deal with patents, inventions, improvements, processes, formulas, trademarks,
trade names, rights and licenses secured under letters patent copyrights or
otherwise.
To enter into, make and perform contracts of any kind for any lawful
purpose, with any person, firm, association or corporation, town, city, county,
body politic, state, territory, government or colony or dependency thereof.
To borrow money for any of the purposes of the corporation and to draw,
make, accept, endorse, discount, execute, issue, sell, pledge or otherwise
dispose of promissory notes, drafts, bills of exchange, warrants, bonds,
debentures and other negotiable or non-negotiable, transferable or
non-transferable instruments and evidences of indebtedness and to secure the
payment thereof and the interest thereon by mortgage or pledge, conveyance or
assignment in trust of the whole or any part of the property of the corporation
at the time owned or thereafter acquired.
To purchase, hold, sell and transfer the shares of its capital stock.
To engage in any business or transaction permitted by the General
Corporation Law of Delaware.
To have one or more offices and to conduct any and all of its operations and
business and to promote its objects, within or without the State of Delaware,
without restriction as to place or amount.
To carry on any other business in connection therewith.
To do any or all of the things herein set forth as principal, agent,
contractor, trustee or otherwise, alone or in company with others.
The objects and purposes specified herein shall be regarded as independent
objects and purposes and, except where otherwise expressed, shall in in no way
limited nor restricted by reference to or inference from the terms of any other
clause or paragraph of the Certificate of Incorporation.
The foregoing shall be construed both as objects and powers and the
enumeration thereof shall not be held to limit or restrict in any manner the
general powers conferred on this corporation by the laws of the State of
Delaware.
<PAGE>
FOURTH. The Total number of shares of stock which this corporation shall
have authority to issue is Fifty-One Million (51,000,000) shares, divided into
two classes, namely, Preferred Stock and Common Stock. The number of shares of
Preferred Stock which this corporation is authorized to issue is One Million
(1,000,000) shares of the par value of Ten Cents ($0.10) per share, and the
number of shares of Common Stock which this corporation is authorized to issue
is Fifty Million (50,000,000) shares of the par value of Ten Cents ($0.10) per
share.
There is hereby expressly granted to the board of directors of the
corporation the power and authority to issue the Preferred Stock as a class
without series, or if so determined from time to time, in one or more series,
and to fix the voting powers, full or limited, or not voting powers, and such
designations, preferences and relative, participating, optional or other special
rights of the class of the Preferred Stock or of one or more series thereof and
the qualifications, limitations or restrictions thereof with respect to the
Preferred Stock authorized herein in a resolution or resolutions adopted by the
board of directors providing for the issue of said stock. The holders of
preferred Stock shall have no preemptive rights to subscribe for any shares of
any class of stock of the corporation whether now or hereafter authorized.
The board of directors is further authorized to provide that the Preferred
Stock, when issued, may be convertible into or exchangeable for shares of any
other class or classes of stock of the corporation or of any series of the same
at such price or prices or rates of exchange and with such adjustments as shall
be stated or expressed in the resolution or resolutions providing for the issue
of such Preferred Stock adopted by the board of directors as hereinabove
provided.
Each and every resolution adopted by the board of directors providing for
the issuance of the preferred Stock as a class or in series within such class
from time to time shall be, under certificate of the proper officers of the
corporation, filed with the Secretary of State of Delaware and a certified copy
thereof shall be recorded in the same manner as certificates of incorporation
are required to be filed and recorded.
No holder of Common Stock shall be entitled as such, as a matter of right,
to subscribe for or to purchase any part of any new or additional issue of stock
of any class whatsoever.
FIFTH. The minimum amount of capital with which the Corporation will
commence business is one thousand dollars ($1,000).
SIXTH. This corporation is to have perpetual existence.
SEVENTH The private property of the stockholders shall not be subject to
the payment of corporate debts to any extent whatever.
<PAGE>
EIGHTH: In furtherance and not in limitation of the powers conferred by
the laws of the State of Delaware, the board of directors is expressly
authorized:
To make, alter, amend and repeal the bylaws;
To set apart out of any of the funds of the corporation available for
dividends a reserve or reserves for any proper purpose and to alter or abolish
any such reserve; to authorize and cause to be executed mortgage and liens upon
the property and franchises of this corporation;
To designate, by resolution passed by a majority of the whole board, one or
more committees, each to consist of one or more directors, to the extent
provided in such resolution or in the bylaws of the corporation, shall have and
may exercise any or all of the powers of the board of directors in the
management of the business and affairs of this corporation and have power to
authorize the seal of this corporation to be affixed to all papers which may
require it.
From time to time to determine whether and to what extent and at what times
and places and under what conditions and regulations the books and accounts of
this corporation, or any of them other than the stock ledger, shall be open to
the inspection of the stockholders, and no stockholder shall have any right to
inspect any account or book or documents of the corporation, except as conferred
by law or authorized by resolution of the directors or of the stockholders.
To sell, lease or exchange all of its property and assets, including its
good-will and its corporate franchises, upon such terms and conditions and for
such consideration, which may be in whole or in part shares of stock in, and/or
other securities of, any other corporation or corporations, when and as
authorized by the affirmative vote of the holders of a majority of the stock
issued and outstanding having voting power given at a stockholders' meeting duly
called for that purpose.
This corporation may in its bylaws confer powers additional to the foregoing
upon the directors, in addition to the powers and authorities expressly
conferred upon them by law.
NINTH. If the bylaws so provide, the stockholders and directors shall
have power to hold their meetings, to have an office or offices and to keep the
books of this corporation (subject to the provisions of the statute) outside of
the State of Delaware at such places as may from time to time be designated by
the bylaws or by resolution of the directors.
TENTH. This corporation reserves the right to amend, alter, change or
repeal any provision contained in this certificate of incorporation in the
manner now or hereafter prescribed by law and all rights conferred on officers,
directors and stockholders herein are granted subject to this reservation.
<PAGE>
ELEVENTH. Any action required or permitted to be taken at any annual or
special meeting of stockholders shall be taken only at such a meeting and shall
not be taken by the written consent of stockholders in lieu of a meeting.
TWELFTH. The name and address of the initial sole director is:
Name Address
---- -------
O. Wayne Rollins 2170 Piedmont Road, N.E.
Atlanta, Georgia
THIRTEENTH. The name and address of the incorporator is:
Name Address
---- -------
V.A. Brookens 100 West Tenth Street
Wilmington, Delaware 19801
IN WITHNESS WHEREOF, the undersigned executes this Certificate of
Incorporation this 20th day of January, 1984.
----------------
Incorporator
V.A. Brookens
<PAGE>
Exhibit (3)(1)(b) RPC's Certificates of Amendment of the Certificate of
Incorporation
<PAGE>
CERTIFICATE OF AMENDMENT
OF CERTIFICATE OF INCORPORATION OF
RPC ENERGY SERVICES, INC.
IT IS HEREBY CERTIFIED THAT:
FIRST: The name of the corporation is RPC Energy Services, Inc., a Delaware
Corporation (the " Corporation").
SECOND: That at a meeting of the Board of Directors of RPC Energy Services, Inc,
resolutions were duly adopted setting forth a proposed amendment "FIFTEENTH"
(the "Amendment") to the Certificate of Incorporation of the Corporation,
declaring said Amendment to be advisable and calling a meeting of the
stockholder of the Corporation for consideration.
THIRD: That thereafter, pursuant to the resolution of its Board of Directors, a
regular meeting of the Stockholders of the Corporation was duly called and held,
upon notice in accordance with Section 222 of the General Corporation Law of the
State of Delaware at which meeting the necessary number of shares as required by
statute were voted in favor of the Amendment.
FOURTH: The certificate of Incorporation of the Corporation is hereby amended by
adding the following new article FIFTEENTH:
FIFTEENTH: A director of this corporation shall not be personally liable to
this corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the corporation or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) under Section 174 of the Delaware
General Corporation Law, as the same exists or hereafter may be amended, or
(iv) for any transaction from which the director derived an improper personal
benefit. If the Delaware General Corporation Law hereafter is amended to
authorize the further elimination or limitation of the liability of
directors, then the liability of a director of this corporation, in addition
to the limitation on personal liability provided herein, shall be limited to
the fullest extent permitted by the amended Delaware General Corporation Law.
Any repeal or modification of this paragraph by the stockholders of this
corporation shall be prospective only, and shall not adversely affect any
limitation on the personal liability of a director of this corporation
existing at the time of such repeal or modification."
FIFTH: The Amendment of the Certification of Incorporation herein certified
has been duly adopted in accordance with the provisions of Section 242 of the
General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be signed by
Richard A. Hubbell, its President and attested by Linda H. Graham, its Secretary
this 20th day of August, 1987.
RPC ENERGY SERVICES, INC.
- --------------------------------------------------------------------------------
Richard A. Hubbell, President
Attest:
- --------------------------------------------------------------------------------
Linda Graham, Secretary
<PAGE>
CERTIFICATE OF CORRECTION FILED TO CORRECT CERTAIN ERRORS IN THE CERTIFICATE OF
RPC ENERGY SERVICES, INC. OF DELAWARE FILED
IN THE OFFICE OF THE SECRETARY OF STATE OF DELAWARE ON JANUARY 20, 1984,
AND RECORDED IN THE OFFICE OF THE RECORDER OF DEEDS FOR NEW CASTLE COUNTY,
DELAWARE, ON JANUARY 20, 1984.
RPC Energy Services, Inc. (the "Company"), a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware,
DOES HEREBY CERTIFY:
1. The name of the Company is RPC Energy Services, Inc.
2. That a Certificate of Incorporation was filed by the Secretary of State
of Delaware on January 20, 1984 recorded in the office of the Recorder
of Deeds of New Castle county on January 20, 1984 and that said
Certificate requires correction as permitted by subsection (F) of
section 103 of The General Corporation Law of the State of Delaware.
3. The inaccuracies or defects of said Certificate to be corrected are as
follows:
a) the second line of the fourth paragraph of Article THIRD found on page
2 of the Certificate contains the typographical error "ad," which
should read "and".
b) the twenty-fourth line of the seventh paragraph of Article THIRD found
on page 2 of the Certificate contained the typographical error
"devised," which should read "devices."
4. Article THIRD of the Certificate is hereby corrected as follows:
a) The second line of the fourth paragraph is corrected in its entirety as
follows: "gas, sulphur, liquid and gaseous hydrocarbons and other
minerals"
b) The twenty-fourth line of the seventh paragraph is corrected to read in
its entirety as follows: "devices, accessories, and related products
and unrelated products and".
IN WITNESS WHEREOF, the Company has caused this Certificate to be signed by
R. Randall Rollins, its Chairman and President and attested by Harrison Jones
II, its Secretary this 12th day of April, 1984.
RPC ENERGY SERVICES, INC.
- --------------------------------------------------------------------------------
R. Randall Rollins
Attest:
- --------------------------------------------------------------------------------
Harrison Jones II
<PAGE>
CERTIFICATE OF AMENDMENT
OF CERTIFICATE OF INCORPORATION OF
RPC ENERGY SERVICES, INC.
IT IS HEREBY CERTIFIED THAT:
1. The name of the corporation (the " Corporation") is RPC Energy
Services, Inc.
2. The Certificate of Incorporation of the Corporation (the " Certificate
of Incorporation") is hereby amended by striking out Article Fourth
thereof and by substituting in lieu of said Article the following
Article:
"FOURTH. The total number of shares of stock which this corporation shall have
authority to issue is 36,000,000 shares, divided into two classes, namely,
Preferred Stock and Common Stock. The number of shares of Preferred Stock which
this corporation is authorized to issue is One Million (1,000,000) shares of the
par value of Ten Cents ($0.10) per share, and the number of shares of Common
Stock which this corporation is authorized to issue is Thirty-five Million
(35,000,000) shares of the par value of Ten Cents ($0.10) per share."
3. The amendment of the Certificate of Incorporation herein certified was
duly adopted in accordance with the provisions of Section 242 of the
Delaware General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, RPC Energy Services, Inc. has caused this certificate to be
signed by its President and attested by its Secretary this 3rd day of June,
1992.
- --------------------------------------------------------------------------------
Richard A. Hubbell, President
Attest:
- --------------------------------------------------------------------------------
Linda Graham, Secretary
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE CERTIFICATE OF INCORPORATION OF
RPC ENERGY SERVICES, INC.
IT IS HEREBY CERTIFIED THAT:
1. The name of the corporation is RPC Energy Services, Inc. (the
"Corporation").
2. The Certificate of Incorporation of the Corporation (the " Certificate
of Incorporation") is hereby amended by striking out the FIRST
paragraph, in its entirety, and substituting in lieu thereof, the
following new paragraph:
"FIRST. The name of this corporation is RPC, Inc."
3. The amendment of the Certificate of Incorporation herein certified was
duly adopted in accordance with the provisions of Section 242 of the
Delaware General Corporation Law on April 25, 1995 at the Annual
Meeting of the Stockholders of the Corporation.
Dated this 25th day of April, 1995.
- --------------------------------------------------------------------------------
Richard A. Hubbell, President
Attest:
- --------------------------------------------------------------------------------
Linda Graham, Secretary
[CORPORATE SEAL]
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE CERTIFICATE OF INCORPORATION OF
RPC, INC.
IT IS HEREBY CERTIFIED THAT:
1. The name of the corporation is RPC, Inc., a corporation organized and
existing under the Delaware General Corporation Law (the
"Corporation").
2. The Certificate of Incorporation of the Corporation, as amended (the
"Certificate of Incorporation") is hereby amended by striking out the
Article FOURTH, in its entirety, and substituting in lieu thereof, the
following new paragraph:
"FOURTH. The total number of shares of stock which this corporation shall have
authority to issue is Eighty Million (80,000,000) shares, divided into two (2)
classes, namely, Preferred Stock and Common Stock, This corporation is
authorized to issue One Million (1,000,000) shares of Ten Cents ($0.10) par
value Preferred Stock, and Seventy-Nine Million (79,000,000) shares of Ten Cents
($0.10) par value Common Stock."
3. The amendment of the Certificate of Incorporation herein certified has
been duly adopted in accordance with the provisions of Section 242 of
the Delaware General Corporation Law.
In WITNESS WHEREOF, the Corporation has caused this Certificate to be signed by
its President and attested by its Secretary as of this 4th day of June, 1998.
`
RPC, Inc.
- --------------------------------------------------------------------------------
Richard A. Hubbell, President
Attest:
- --------------------------------------------------------------------------------
Linda Graham, Secretary
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
RPC ENERGY SERVICES, INC.
RPC Energy Services, Inc., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware,
DOES HEREBY CERTIFY;
FIRST: That the sole director of said corporation, by written consent,
filed with the minutes of the Board of Directors, duly adopted a resolution
proposing and declaring advisable the following amendment:
RESOLVED, that the Certificate of Incorporation of this corporation be
amended by adding Article FOURTEENTH which shall read as follows:
"FOURTEENTH. (1) For purposes of this Article, the following terms
shall have the following meanings:
(a) "Acquiring Entity' means any corporation, person, group,
firm, trust, partnership or other entity, or any parent,
subsidiary or other affiliate of such entity, which is the
beneficial owner, directly or indirectly, or 20% or more of
this corporation's outstanding voting securities (taken
together as a single class) and which first becomes
beneficial owner of 20% or more of such securities after
August 1, 1984. Any corporation, person, group, firm, trust,
partnership or other entity will be deemed to be the
beneficial owner of any voting securities of this
corporation:
(i) which it owns directly, whether or not of record.
(ii) which it has the right to acquire pursuant to any
agreement or arrangement or understanding or upon
exercise of conversion rights, exchange rights,
warrants or options or otherwise,
(iii) which are beneficially owned, directly or
indirectly (including shares deemed to be owned
through application of clause (ii) above), by any
`affiliate' or `associate' as those terms are
defined in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of
1984, or
(iv) which are beneficially owned, directly or
indirectly (including shares deemed owned through
application of clause (ii) above), by any other
corporation, person, group, firm, trust,
partnership or other entity with which it or any of
its subsidiaries, `affiliates' or `associates' has
any
<PAGE>
agreement or arrangement or understanding for the
purpose of acquiring, holding, voting or disposing
of this corporation's voting securities.
For the purpose of this Article FOURTEENTH, in
determining whether a corporation, person, group,
firm, trust, partnership of other entity owns
beneficially, directly or indirectly, 20% or more
of this corporation's outstanding voting
securities, this corporation's outstanding voting
securities will be deemed to include any voting
securities that may be issuable pursuant to any
agreement, arrangement or understanding or upon
exercise of conversion rights, exchange rights,
warrants, options or otherwise which are deemed to
be beneficially owned by such corporation, person,
group, firm, trust, partnership or other entity
pursuant to the foregoing provisions of this
paragraph 1 notwithstanding the inability of such
entity to vote such shares.
(b) `Continuing Director' means any member of the Board of
Directors of this corporation who is unaffiliated with the
Acquiring Entity and who was a member of the Board of
Directors of the Corporation prior to the time that the
Acquiring Entity became an Acquiring Entity, and any
successor of a Continuing Director who is unaffiliated with
the Acquiring Entity and is recommended to succeed a
Continuing Director by a majority of Continuing Directors
than on the Board of Directors of this corporation.
(c) `Special Business Combination' means:
(i) any merger or consolidation of this corporation
with or into an Acquiring Entity;
(ii) any sale, lease, exchange or other disposition (in
one transaction or a series of related
transactions) of all or substantially all of the
assets of this corporation to an Acquiring Entity;
(iii) any sale, lease, exchange, or other disposition (in
one transaction or a series of related
transactions) by an Acquiring Entity to this
corporation or any subsidiary of this corporation
of any assets (except assets having an aggregate
fair market value at the time of such transaction
of less than $10,000,000) in exchange for any
voting securities (or securities convertible into
or exchangeable for voting securities, or options,
warrants or rights to purchase voting securities or
securities convertible into or exchangeable for
voting securities) of this corporation or any
subsidiary of this corporation; or
(iv) any reclassification of securities, reverse stock
split or combination of shares, recapitalization or
other transaction designed to decrease the number
of holders of this corporation's voting securities
remaining after any other corporation, person,
group, firm, trust, partnership or other entity has
become an Acquiring Entity. Notwithstanding the
foregoing, any transaction which would otherwise
consititue a Special Business Combination shall not
constitute a Special
<PAGE>
Business Combination if the conditions specified in
subsection (x) or subsection (y) of this paragraph
1(C)are satisfied:
(x) a majority of the Continuing Directors approve the
transaction, provided that this condition (x) shall
not be capable of satisfaction unless there is at
lease one Continuing Director; or
(y) the transaction
(i) does not change any voting security
holder's percentage ownership of voting
securities in any successor to this
corporation from the percentage of voting
securities beneficially owned by such
holder in this corporation; and
(ii) provides that the provisions of this
Article, without any amendment, change,
alteration, or deletion, will apply to
any successor to this corporation; and
(iii) does not transfer all or substantially
all of this corporation's assets, other
than to a wholly owned subsidiary of this
corporation.
(2) No Special Business Combination shall be effected unless it is approved
at a meeting of this corporation's stockholders called for that
purpose. This presence in person or by proxy of the holders of at least
80% of the outstanding voting securities of this corporation entitled
to vote at such meeting shall be required to constitute a quorum at any
such meeting. The affirmative vote of the holders of at least 75% of
the outstanding voting securities of this corporation entitled to vote
at such meeting shall be required for approval of any such Special
Business Combination.
(3) The quorum and affirmative vote required by this Article will be in
addition to any vote of this Corporation's security holders otherwise
required by law, this Certificate of Incorporation, a resolution
providing for the issuance of a class or series of stock which has been
adopted by the Board of Directors, or any agreement between this
corporation and any national securities exchange.
(4) No amendment, alteration, change or repeal of any provision of this
Article may be effected unless it is approved at a meeting of this
Corporation's stockholders called for that purpose. The presence in
person or by proxy of the holders of at least 80% of the outstanding
voting securities of this corporation entitled to vote at such meeting
shall be required to constitute a quorum at any such meeting.
Notwithstanding any other provision of this Certificate of
Incorporation, the affirmative vote of the holders of at least 75% of
the outstanding voting securities entitled to vote at such meeting
shall be
<PAGE>
required to amend, alter, change, or repeal, directly or indirectly,
any provision of this Article."
SECOND: That in lieu of a meeting and vote of stockholder, the sole
stockholder has given written consent to said amendment in accordance with the
provisions of Section 228 of the General Corporation Law of the State of
Delaware.
THIRD: That the aforesaid amendment was duly adopted in accordance with
the applicable provisions of sections 242 and 228 of the General Corporation Law
of the State of Delaware.
IN WITNESS THEREOF, said corporation, RPC Energy Services, Inc. has
caused this certificate to be signed:
by: R. Randall Rollins its Chairman and President and attested
by: Harrison Jones II its Secretary this 12th day of April, 1984.
RPC Energy Services, Inc.
by: R. Randall Rollins
ATTEST:
by: Harrison Jones II
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JUL-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 8,353
<SECURITIES> 3,841
<RECEIVABLES> 40,546
<ALLOWANCES> 7,388
<INVENTORY> 17,282
<CURRENT-ASSETS> 76,517
<PP&E> 216,322
<DEPRECIATION> 148,505
<TOTAL-ASSETS> 183,623
<CURRENT-LIABILITIES> 34,164
<BONDS> 804
0
0
<COMMON> 2,897
<OTHER-SE> 141,590
<TOTAL-LIABILITY-AND-EQUITY> 183,623
<SALES> 0
<TOTAL-REVENUES> 56,977
<CGS> 20,405
<TOTAL-COSTS> 47,458
<OTHER-EXPENSES> 4,074
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 6,055
<INCOME-TAX> 2,302
<INCOME-CONTINUING> 3,753
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,753
<EPS-PRIMARY> 0.13
<EPS-DILUTED> 0.13
</TABLE>
