PROSPECTUS RULE 424(b)(3)
33-56029
READING & BATES CORPORATION
25,938,802 Shares
Common Stock
The shares (the "Shares") of common stock, par value $.05 per
share (the "Common Stock"), of Reading & Bates Corporation (the
"Company") offered hereunder may be offered from time to time by
certain stockholders of the Company (the "Selling Stockholders"). See
"Selling Stockholders" and "Plan of Distribution". The Company will
not receive any proceeds from any sale of Shares by a Selling
Stockholder hereunder. See "Use of Proceeds".
The Common Stock, including the Shares, is listed on the New
York Stock Exchange and the Pacific Stock Exchange (the "Exchanges")
under the symbol "RB". The last reported sales price of the Common
Stock on November 2, 1994 on the New York Stock Exchange Composite
Transactions Tape was $6.375 per share.
________________
An investment in the Shares involves a high degree of risk.
Prospective purchasers should carefully consider the matters set
forth under "Risk Factors".
________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRE-
SENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
_________________
Offers and sales of Shares by the respective Selling
Stockholders may be effected from time to time in one or more
transactions, directly by the respective Selling Stockholders, or
through agents, dealers, brokers or underwriters to be designated
from time to time. Such offers or sales may be effected over the
Exchanges, in negotiated off-exchange transactions, in coordinated
public offerings, in a combination of such methods of sale or by any
other legally available means. The selling price of the Shares may be
at market prices prevailing at the time of sale, at prices related to
such prevailing market prices, at fixed prices or at negotiated
prices. The Company has agreed to pay certain expenses of, and under
certain circumstances to indemnify, the Selling Stockholders in
connection with the offering of Shares contemplated hereby. See
"Selling Stockholders" and "Plan of Distribution".
The date of this Prospectus is November 4, 1994.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
in accordance therewith files reports, proxy statements and other
information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements and other information
can be inspected and copied at the public reference facilities
maintained by the Commission at Judiciary Plaza, 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549, and at its regional offices
at Northwestern Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661 and Seven World Trade Center, Suite 1300, New
York, New York 10048. Copies of such materials can be obtained from
the Public Reference Section of the Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549, on payment of prescribed charges. Such
reports, proxy statements and other information concerning the
Company can also be inspected at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005 and the Pacific
Stock Exchange, 301 Pine Street, San Francisco, California 94104, on
which Exchanges the Common Stock is listed.
The Company has filed with the Commission registration
statements on Form S-3 (together with all amendments and exhibits
thereto, the "Registration Statements") under the Securities Act of
1933, as amended (the "Securities Act") with respect to the Shares.
This Prospectus does not contain all the information set forth in the
Registration Statements, certain parts of which are omitted in
accordance with the rules and regulations of the Commission.
Statements contained herein concerning the provisions of documents
are necessarily summaries of such documents, and each statement is
qualified in its entirety by reference to the copy of the applicable
document filed with the Commission. Copies of the Registration
Statements and the exhibits are on file at the offices of the
Commission and may be obtained upon payment of the fees prescribed by
the Commission, or may be examined without charge at the public
reference facilities of the Commission described above.
INCORPORATION BY REFERENCE
The following documents have been filed by the Company with the
Commission pursuant to the Exchange Act and are incorporated herein
by reference: (1) the Company's Annual Report on Form 10-K for the
year ended December 31, 1993, as amended by the Company's Amendment
No. 1 on Form 10-K/A dated March 29, 1994, Amendment No. 2 on Form
10-K/A dated May 3, 1994, Amendment No. 3 on Form 10-K/A dated June
8, 1994 and Amendment No. 4 on Form 10-K/A dated June 23, 1994; (2)
the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1994; (3) the Company's Quarterly Report on Form 10-Q for
the quarter ended June 30, 1994; (4) the Company's Quarterly Report
on Form 10-Q for the quarter ended September 30, 1994; (5) the
description of the Common Stock contained in the Company's Registration
Statement on Form 8-A dated October 19, 1989, as amended by the
Company's Post-Effective Amendment No. 2 on Form 8-A/A dated May 27,
1994, relating to the Common Stock; and (6) the Company's Current
Reports on Form 8-K dated January 3, 1994, January 17, 1994, February
1, 1994, February 14, 1994, February 15, 1994, March 14, 1994, March
17, 1994, March 25, 1994, April 21, 1994, May 12, 1994, June 2, 1994,
June 27, 1994, July 19, 1994, August 9, 1994, August 10, 1994,
September 7, 1994, September 26, 1994 and October 20, 1994.
All documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of this offering shall be
deemed to be incorporated by reference in this Prospectus and to be a
part hereof from the date of filing such documents. Any statement
contained in a document incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus
to the extent that a statement contained herein, or in any other
subsequently filed document that also is incorporated by reference
herein, modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
The Company will furnish, without charge, to any person to whom
a copy of this Prospectus is delivered, upon such person's written or
oral request, a copy of any and all of the information filed by the
Company that has been incorporated by reference in this Prospectus
(not including exhibits to the information that is incorporated by
reference herein unless such exhibits are specifically incorporated
by reference in such information). Requests for such copies should be
directed to the Company at 901 Threadneedle, Suite 200, Houston,
Texas 77079, Attention: Corporate Secretary (telephone number:
(713) 496-5000).
______________________
Unless the context otherwise requires, the term "Reading &
Bates" or the "Company", as used in this Prospectus, means Reading &
Bates Corporation and its subsidiaries taken as a whole.
RISK FACTORS
Prospective purchasers of the Common Stock should consider
carefully the following matters, as well as the information contained
elsewhere in this Prospectus and incorporated herein by reference.
Reliance on Oil and Gas Industry; Depressed Industry Conditions
The Company's business and operations are substantially
dependent upon the condition of the oil and gas industry, the level
of offshore oil and gas drilling activity and the supply of suitable
offshore drilling rigs. The offshore contract drilling industry is a
highly competitive and historically cyclical business. It is
characterized by high capital costs, long lead time for construction
of new rigs and numerous industry participants. Offshore drilling
rigs have few alternative uses and, because of their nature and the
environment in which they work, have relatively high costs whether or
not operating. Drilling contracts are generally awarded on a
competitive bid basis and, while an operator selecting a rig may
consider, among other things, quality of service and equipment,
pricing is currently a primary factor in determining which contractor
is awarded a job. As is typical in the industry, the Company does
business with a relatively small number of customers at any given
time. The loss of any of such customers could, at least on a
short-term basis, have a material adverse impact on the Company's
profitability.
Despite occasional improvements, the market for offshore
contract drilling and related services has been depressed in recent
years. Domestically, oil and natural gas prices have been directly
affected by such factors as natural gas production, availability of
new oil and gas leases and government regulations regarding, among
other things, environmental protection, taxation, product
allocations, price controls and import tariffs. Further, many oil
companies have postponed or suspended budgetary approval for more
expensive drilling in deep water and/or harsh environments (a primary
area of emphasis of the Company). Worldwide military, political and
economic events, including initiatives by the Organization of
Petroleum Exporting Countries ("OPEC"), are likely to continue to
cause price volatility. Factors which influence demand for the
Company's services include the ability of OPEC to set and maintain
production levels and prices, the level of production by non-OPEC
countries, worldwide demand for oil and gas, and contract and other
terms sought by various governments to explore and develop oil, gas
and other hydrocarbon energy sources. Although the supply of
available drilling units in the industry has declined in recent
years, the supply of offshore drilling equipment continues to exceed
demand and the Company cannot predict the future level of demand for
the Company's drilling services.
Intense Competition
The offshore contract drilling market is highly competitive and
no one competitor is dominant. There has been a prolonged period of
intense price competition during which many rigs have been idle for
long periods of time. Consequently, some drilling contractors have
gone out of business, sought protection under the bankruptcy laws or
consolidated with other contractors. Notwithstanding these
circumstances, the industry remains highly fragmented and
competitive. The Company believes that competition for drilling
contracts will continue to be intense for the foreseeable future.
Certain of the Company's competitors are larger or have access to
greater financial resources than the Company, which may enable them
better to withstand industry downturns, to compete on the basis of
price, to build new rigs or to acquire existing rigs that become
available for purchase.
Limited Liquidity; Restricted Access to Capital; Restrictions on
Operations
The Company will require substantial cash flow to meet its
principal and interest repayment obligations on existing indebtedness
and dividend payments on its $1.625 Convertible Preferred Stock, par
value $1.00 per share (the "Preferred Stock"). The ability of the
Company to meet such obligations will be dependent on the Company's
future performance and liquidity. The Company's performance is
subject to financial, economic and other factors affecting the
Company, many of which are beyond its control. The Company has had
and may continue to have debt service obligations, capital
expenditures and working capital requirements in excess of its cash
provided by operations. Substantially all of the Company's assets
are encumbered and with limited exceptions, the Company is precluded
by the terms of its principal credit facility from borrowing funds
from other sources without the consent of the lender. There can be
no assurance that, if the need arises or an opportunity is presented
to improve the condition, variety or quality of its fleet, the
Company could obtain additional debt or equity capital on terms which
the Company would consider reasonable.
The Company's Norwegian subsidiary, Arcade Drilling AS
("Drilling"), is subject to various restrictions on its ability to
obtain additional financing, pay dividends, make investments, extend
credit, guarantee obligations of others, lease or sell assets, or
engage in business combinations. In addition, Drilling's debt
obligations contain a number of financial covenants, including
covenants requiring certain levels of working capital and liquidity.
These restrictions limit, among other things, the ability of Drilling
to obtain additional capital, as well as the ability of the Company
to receive loans, advances or dividends from Drilling. The Company's
ability to receive loans, advances or dividends from Drilling is
further restricted by Norwegian legal restrictions on the funds that
may be used for such purposes and rights of minority shareholders
under Norwegian law. There are also restrictions on the Company's
ability to engage in transactions with Drilling under an agreement
with another shareholder of Drilling.
Restrictions Relating to Existing Indebtedness
Under the credit agreement (as amended, the "ING Facility")
between the Company and Internationale Nederlanden Bank N.V. ("ING
Bank"), and under certain agreements relating to other obligations of
the Company, substantially all of the Company's assets are encumbered
and the Company is subject to various restrictions on its ability to
obtain additional financing, make investments, pay dividends, lease
equipment, sell assets and engage in business combinations. The
Company is also required under the ING Facility to comply with
certain financial covenants and maintain certain financial ratios.
It is also an event of default under the ING Facility if there should
occur a material adverse change in the financial or business
condition of the Company or certain of its subsidiaries. The ING
Facility prohibits the Company from declaring or paying dividends in
any one year in excess of 50% of its cumulative net income subsequent
to March 29, 1991. ING Bank has consented to the payment of regular
cash dividends on the Preferred Stock, without regard to such
limitation. Although the Company is currently in compliance with the
foregoing restrictions and provisions, the Company's ability to
comply in the future with such restrictions and provisions may be
affected by the levels of cash flow from the Company's operations and
events or circumstances beyond the Company's control. Failure by the
Company to comply with any of the restrictions and provisions under
the ING Facility could result in a default under the ING Facility,
which in turn could cause such indebtedness to be declared
immediately due and payable.
Under Drilling's bank credit agreement, Drilling is prohibited,
under certain circumstances, from paying dividends and granting loans
(including to the Company). Drilling is also subject to various
restrictions and financial covenants under debt obligations. It is
also an event of default under certain of Drilling's loan agreements
if there should occur a material adverse change in the financial or
business condition of Drilling. See "--Limited Liquidity; Restricted
Access to Capital; Restrictions on Operations".
Results of Operations
The Company has reported net losses applicable to common
stockholders of $15.2 million for the nine months ended September 30,
1994, net income applicable to common stockholders of $2.6 million for
the year ended December 31, 1993, net losses applicable to common
stockholders of $1.9 million for the year ended December 31,1992, and
net losses from continuing operations (before extraordinary gain and
cumulative effect of change in accounting principle) of $17.4
million, $53.8 million and $60.5 million for the years ended December
31, 1991, 1990 and 1989 respectively.
Control by Certain Stockholders
As of September 30, 1994, the partners of BCL Investment
Partners, L.P. ("BCL") controlled approximately 30% of the Company's
outstanding Common Stock, and R&B Investment Partnership, L.P., R&B
Investment Partnership II, L.P., Whitman Heffernan & Rhein Workout
Fund, L.P. and WHR Management Company, L.P. (the "WHR Partnerships")
controlled approximately 7% of the Company's outstanding Common
Stock. BCL and one of the WHR Partnerships each designated two of
the ten current members of the Company's Board of Directors and one
designee of each partnership is an executive officer of the Company.
The directors designated by BCL and such WHR Partnership were
designated pursuant to agreements between the Company and BCL and
such WHR Partnership, respectively, which agreements were terminated
effective as of September 14, 1993.
If the partners of BCL and the WHR Partnerships choose to act
together, as they generally have over the past three years, they may
effectively control the management of the Company and decisions
requiring shareholder approval. One other director is an officer of
a corporation that controls RBY, Ltd. See "Selling Stockholders" and
"Plan of Distribution".
Shares Eligible for Future Sale
As of September 30, 1994, approximately 37% of the outstanding
Common Stock was held by persons who may be deemed "affiliates" (as
defined in Rule 144) of the Company, including the partners of BCL
and the WHR Partnerships. Such shares may be eligible for public
resale subject to the volume and manner of sale limitations of Rule
144. Substantially all of such shares of Common Stock are
registered on the Registration Statements of which this Prospectus is
a part. Pursuant to a Registration Rights Agreement between such
persons and the Company as amended and currently in effect (the
"Registration Rights Agreement"), the Company is obligated to
register substantially all of the shares of Common Stock held by such
persons on a "shelf" registration statement filed pursuant to Rule
415 under the Securities Act and to keep such shelf registration
statement continuously effective until the earlier to occur of August
1, 1996 or the sale by the holders of all of the Shares. Pursuant to
the Registration Rights Agreement, holders of the Shares have waived
(i) their rights to effect underwritten registered public offerings
during such period and (ii) restrictions on underwritten public
offerings by the Company during such period. After the expiration of
such period, however, holders of shares of Common Stock subject to
the Registration Rights Agreement will be entitled to require the
Company to register Shares under the Securities Act in connection
with up to seven underwritten registered public offerings.
In September 1994, as partial consideration for the repurchase
by the Company of certain notes or interests (the "Lease Debt")
relating to leveraged leases of the drilling units "C.E. Thornton"
and "George H. Galloway" and the secured financing of the drilling
unit "F.G. McClintock", the Company issued 4,230,235 shares of Common
Stock in private placements pursuant to Common Stock Issuance
Agreements (the "Issuance Agreements") between the Company and the
holders of such Lease Debt, at a price per share of $6.375 (the
closing price of the Common Stock on the New York Stock Exchange on
August 5, 1994, the last preceeding business day prior to the date of
the Company's offer to repurchase the Lease Debt). All of such Shares
are registered on the Registration Statements of which this Prospectus
is a part. Pursuant to the Issuance Agreements, the Company is
obligated to register all of such Shares on a "shelf" registration
statement filed pursuant to Rule 415 under the Securities Act and to
keep such shelf registration statement continuously effective until
the earlier to occur of September 14, 1996 or the sale of all of such
Shares pursuant to any such registration statement.
Future sales of Common Stock, either pursuant to Rule 144 or
the Registration Statements of which this Prospectus is a part, or
the perception that such sales may occur, could adversely affect the
prevailing market price for the Common Stock. See "Selling
Stockholders" and "Plan of Distribution".
Potential Restrictions on Sales of Shares to Non-U.S. Citizens
As the indirect owner, through certain of its subsidiaries, of
mobile offshore drilling units registered or formerly registered as
vessels under U.S. flag, the Company is subject to the provisions of
the Shipping Act, 1916, which restrict the sale of U.S. flag vessels
or the controlling interest in them to non-U.S. citizens without the
consent of the Secretary of Transportation, acting through the United
States Maritime Administration ("MARAD"). In the case of a sale of a
U.S. flag vessel, MARAD's prior written consent will be required
before such transaction can be completed and MARAD may require as a
condition to its consent that the purchaser enter into a contract
with MARAD concerning the future use and control of the vessel. In
the case of the transfer of a controlling interest in a company which
owns a U.S. flag vessel, MARAD's prior written consent will also be
required and may or may not be conditioned upon the seller or the
purchaser entering into agreements with MARAD. In connection with
the transfer of control of the Company to non-U.S. citizens which
occurred after September 1, 1989, the Company obtained the written
consent of MARAD to such transfer, but such consent was limited to
the specific non-U.S. citizens named in MARAD's consent (which
include the non-U.S. citizen groups that control BCL and certain
non-U.S. citizens that are investors in the WHR Partnership). Any
future change in control of the Company involving non-U.S. citizens
would similarly require MARAD's consent. Failure to obtain MARAD's
consent to the sale of a rig to a non-U.S. citizen or to the transfer
of a controlling interest in the Company or in a rig-owning company
to non-U.S. citizens would give MARAD the right to exercise various
remedies provided by the Shipping Act, 1916, including the forfeiture
of the rig or rigs involved, civil penalties (including fines) and
certain misdemeanor criminal penalties.
Absence of Dividends on Common Stock
The Company has not paid any cash dividends on the Common Stock
since the first quarter of 1986 and does not anticipate paying
dividends on the Common Stock at any time in the foreseeable future.
Governmental Regulation and Environmental Matters
The Company's operations are subject to numerous domestic and
foreign governmental laws and regulations that may relate directly or
indirectly to the contract drilling industry, including, without
limitation, laws and regulations controlling the discharge of
materials into the environment, requiring removal and cleanup under
certain circumstances or otherwise relating to the protection of the
environment, and certification, licensing and other requirements
imposed by treaties, laws, regulations and conventions in the
jurisdictions in which the Company operates. For example, as an
operator of mobile offshore drilling units in navigable United States
waters and other offshore areas, the Company may be liable for
damages and for the cost of removing oil spills for which it is found
to be responsible, subject to certain limitations. Laws and
regulations protecting the environment have generally become more
stringent in recent years, and may in certain circumstances impose
"strict liability," rendering a person liable for environmental
damage without regard to negligence or fault on the part of such
person. Such laws and regulations may expose the Company to
liability for the conduct of operations or conditions caused by
others, or for acts of the Company which were in compliance with all
applicable laws at the time such acts were performed. The Company
does not believe that environmental regulations have had any material
adverse effect on its capital expenditures, results of operations or
competitive position, and does not anticipate that any material
expenditures will be required for compliance with existing laws and
regulations. However, the modification of existing laws or
regulations or the adoption of new laws or regulations curtailing or
increasing the effective cost of exploratory or developmental
drilling for or production of oil and gas for economic, environmental
or other reasons could have a material adverse effect on the
Company's operations. The Company's operations in the Gulf of Mexico
are subject to the U.S. Oil Pollution Act of 1990 ("OPA '90") and the
regulations promulgated pursuant thereto. The Company generally
seeks to obtain indemnity agreements whenever possible from the
Company's customers requiring such customers to hold the Company
harmless from liability for pollution that originates below the water
surface (including, where applicable, liability under OPA '90) and
maintains marine liability insurance and contingent energy,
exploration and development insurance which affords the Company
limited protection. When obtained, such contractual indemnification
protection may not in all cases be supported by adequate insurance
maintained by the customer. There is no assurance that any such
insurance or contractual indemnity protection will be sufficient or
effective under all circumstances.
Operating Risks
The Company's operations are subject to the many hazards
inherent in the drilling industry, including such dangers as blowouts
and well fires. The Company's equipment is also subject to hazards
inherent in marine operations, either while on site or under tow,
such as capsizing, sinking, grounding, collision and damage from
severe weather conditions. These hazards can cause personal injury
and loss of life, severe damage to and destruction of property and
equipment, pollution or environmental damage and suspension of
operations. The Company maintains such insurance protection as it
believes to be adequate and in accordance with industry practice
against normal risks in its operations. In addition, the Company
generally seeks to obtain indemnity agreements whenever possible from
the Company's customers requiring such customers to hold the Company
harmless in the event of loss of production or reservoir damage.
There is no assurance that any such insurance or contractual
indemnity protection will be sufficient or effective under all
circumstances or against all hazards to which the Company may be
subject. The occurrence of a significant event not fully insured or
indemnified against or the failure of a customer to meet its
indemnification obligations could materially and adversely affect the
Company's operations and financial condition. Moreover, no assurance
can be given that the Company will be able to maintain adequate
insurance in the future at rates it considers reasonable.
Foreign Operations
The Company's drilling units and operations are geographically
dispersed throughout the world, and are therefore subject to various
political, economic and other uncertainties, including, among others,
the risks of war, expropriation, nationalization, renegotiation or
nullification of existing contracts, taxation policies, foreign
exchange restrictions, changing political conditions, international
monetary fluctuations and foreign governmental regulations which
favor or require the awarding of drilling contracts to local
contractors or require foreign contractors to employ citizens of, or
purchase supplies from, a particular jurisdiction. Furthermore,
changes in domestic or foreign governmental regulations, which may at
any time become applicable to the Company or its operations, could
reduce demand for the Company's services, or adversely affect the
Company's ability to compete for customers. Currently, when
conducting drilling operations in areas the Company perceives as
politically unstable, the Company either (i) negotiates contracts
providing for indemnification against expropriation and certain other
political risks, or (ii) to the extent available and practical,
purchases insurance covering such risks.
Certain Provisions Relating to Changes in Control
The Company's Restated Certificate of Incorporation and Bylaws
contain provisions which may have the effect of delaying, deferring
or preventing a change in control of the Company. Additionally,
Section 203 of the Delaware General Corporation Law restricts certain
"business combinations" between interested stockholders and the
Company, which may render more difficult or tend to discourage
attempts to acquire the Company.
THE COMPANY
Reading & Bates Corporation was incorporated in 1955 under the
laws of the State of Delaware. The Company provides contract
drilling services in major offshore oil and gas producing areas
worldwide. The Company's principal executive offices are located at
901 Threadneedle, Suite 200, Houston, Texas 77079, and its telephone
number is (713) 496-5000.
The Company's offshore drilling fleet currently consists of
eleven jack-up drilling units, five semisubmersible drilling units
and two drilling tenders. The Company intends to continue to
modernize its fleet, and in that regard continues to consider the
selective acquisition of existing rigs, directly or through business
combination transactions, but does not currently contemplate entering
into arrangements for the construction of any new rigs.
USE OF PROCEEDS
The net proceeds from any sale of Shares hereunder will be
received by the respective Selling Stockholders. The Company will
not receive any proceeds from any sale of Shares by any Selling
Stockholder.
SELLING STOCKHOLDERS
Set forth below are the names of each Selling Stockholder, the
number of shares of Common Stock owned as of the date of this
Prospectus by each Selling Stockholder, the number of Shares which
may be offered by each Selling Stockholder, the number of shares of
Common Stock to be owned by each Selling Stockholder upon completion
of the offering contemplated hereby and the percentage of total
shares of Common Stock outstanding owned by each Selling Stockholder
upon completion of the offering contemplated hereby.
<TABLE>
<CAPTION>
Percent
of total
Number of Number of shares
shares which shares outstanding
Number of may be offered owned if owned upon
shares pursuant to all shares completion
Selling Stockholder owned(1) this Prospectus are sold (1)(2) of offering
- ------------------- ----------- ---------------- --------------- -----------
<S> <C> <C> <C> <C>
BCL Investment
Partners, L.P.(3) 80,250 80,250 0 *
Elliott Associates,
L.P. 1,247,814 1,170,997 76,817 *
The Equitable
Life Assurance
Society of the
United States 288,000 288,000 0 *
Financial Investments
Ltd.(3) 1,464,544 1,464,544 0 *
Forreal Ltd.(3) 73,227 73,227 0 *
Grace Brothers, Ltd. 445,756 445,756 0 *
Greenwing Ltd.(3) 1,327,271 1,327,271 0 *
Incomare Holdings,
Inc.(3) 1,610,999 1,610,999 0 *
Ingalls & Snyder
Value Partners L.P. 103,081 102,904 177 *
John Hancock Mutual
Life Insurance
Company 3,071,530 1,594,756 1,476,774 2.47%
Knights of Columbus 159,857 132,000 27,857 *
Life Line Investments
Ltd.(3) 3,758,996 3,758,996 0 *
Massachusetts Mutual
Life Insurance
Company 144,000 144,000 0 *
New England Mutual
Life Insurance
Company 220,000 220,000 0 *
N&M Holding,
N.V.(3) 5,054,607 5,054,607 0 *
Pan-American Life
Insurance Company 117,081 87,822 29,259 *
R&B Investment
Partnership,
L.P.(4) 161,612 161,612 0 *
R&B Investment
Partnership II,
L.P.(4) 120,061 120,061 0 *
RBY, Ltd.(3) 2,509,359 2,509,359 0 *
Torarica N.V.(3) 146,454 146,454 0 *
Whitman Heffernan
& Rhein Workout
Fund, L.P.(4) 3,487,296 3,487,296 0 *
WHR Management
Company, L.P.(4) 127,211 127,211 0 *
Workships
Intermediaries,
N.V.(3) 1,830,680 1,830,680 0 *
_________ _________ ________ ____
Total: 27,549,686 25,938,802 1,610,884 2.47%
========== ========== ========= ====
___________________
* Less than one percent
<FN>
(1) Includes shares of Common Stock as to which such Selling Stockholder is
the "beneficial owner" as defined in Rule 13d-3 under the Exchange Act,
except that (i) shares of Common Stock which may be deemed, pursuant to
such Rule, to be beneficially owned by more than one Selling Stock-
holder are included only for the Selling Stockholder which may currently
offer and sell such Shares pursuant to the Registration Statements and
(ii) securities, if any, that may be held by a Selling Stockholder or
its affiliates in investment accounts, trust accounts, custody accounts
or other similar fiduciary capacities are excluded from the above table.
(2) Assumes no other acquisition of shares of Common Stock after the
date of this Prospectus.
(3) Based upon information contained in a Schedule 13D, as amended as
of October 14, 1994, which was filed by BCL and the other report-
ing persons named therein, and upon certain other information
available to the Company, BCL, a limited partnership, is the
beneficial owner of 15,135,869 shares of Common Stock, including
80,250 shares held directly and 15,055,619 shares distributed by
BCL to its partners (excluding 1,393,247 shares held by N&M
Holding, N.V., an affiliate of ING Bank ("N&M"), as further
described below and 1,327,271 shares held by Greenwing Ltd.
("Ltd")). The Schedule 13D states that under BCL's partnership
agreement, there are five general partners of BCL: Serife
Investments, N.V., a Netherlands Antilles corporation ("Serife"),
Life Line Investments Ltd., a Liberian corporation ("LLI"),
Dedicated Holdings Ltd., a Liberian corporation ("DHL"),
Financial Investments Ltd., a Liberian corporation ("FIL"), and
Greenwing Investments, Inc., a Delaware corporation ("Greenwing").
There is one limited partner of BCL: RBY, Ltd., a Delaware
corporation ("RBY"). Certain shares beneficially owned by
BCL were previously distributed to its partners, certain of whom
subsequently distributed their shares to their stockholders, as
follows: 7,322,720 shares were distributed to Serife, which in
turn distributed 3,661,360 shares each to N&M, a Netherlands
Antilles corporation and an indirect, wholly-owned subsidiary of
ING Bank, and Workships Intermediaries N.V., a Netherlands
Antilles corporation ("Workships"), and Workships subsequently
distributed 1,537,772 shares to Incomare Holdings, Inc.
("Incomare"), 146,454 shares to Torarica N.V. ("Torarica"),
73,227 shares to Forreal Ltd. ("Forreal") and 73,227 shares to
Workfrogs N.V. which immediately conveyed such 73,227 shares to
Incomare for a total of 1,610,999 shares held by Incomare,
leaving Workships with 1,830,680 shares; 3,758,996 shares to LLI;
2,099,180 shares to DHL (which shares were later sold); 1,464,544
shares to FIL; 1,327,271 shares held by Greenwing (which then
conveyed such shares to Ltd); and 2,509,359 shares to RBY. BCL,
Serife, LLI, DHL, FIL, Greenwing, RBY, N&M, Incomare, Torarica,
Forreal and Workships have entered into a stockholders agreement
pursuant to which the shares held by each of them will be voted in
such manner as BCL shall determine, and each has granted an
irrevocable proxy (each, an "Irrevocable Proxy") to BCL. In
addition, under certain conditions set forth in such stockholders
agreement, Serife has a right of first refusal (the "Refusal
Rights") should LLI, DHL and FIL propose to transfer any of their
Common Stock holdings to any person other than one of themselves.
Based upon the Schedule 13D and other information available to
the Company, the Company believes that BCL is ultimately
controlled by N&M, Dr. Cordia and Dr. Laqueur, through their
control of Workships, Den norske Bank AS ("DnB"), through its
control of LLI, DHL and FIL (as described below), and by Paul B.
Loyd, Jr., the Company's chairman and chief executive officer,
through his control of Greenwing and Ltd. In addition, the
Schedule 13D previously indicated that BCL was party to an
agreement with N&M pursuant to which (i) N&M agreed that if
N&M received and wished to accept an offer from a third party to
buy any portion of the 1,393,247 shares acquired by N&M from The
Chase Manhattan Bank, N.A. ("Chase") on March 30, 1993
(together with any securities distributed by the Company with
respect thereto and any Company securities into which such
shares may be converted, the "Subject Shares"), it would first
make an offer to sell such Subject Shares to BCL upon the same
terms and conditions applicable to such third-party offer, (ii)
BCL agreed that if BCL received and accepted an offer from a
third party to buy any portion of the Common Stock owned by BCL,
N&M would be entitled to participate in the sale by selling to BCL
the same percentage of Subject Shares as the number of shares of
Common Stock sold in such transaction bore to the total number
of shares of Common Stock owned by BCL at the same per share price
applicable to the transaction with the third party, (iii) N&M
agreed that if N&M sold to a third party any portion of the
Subject Shares, N&M would pay BCL a specified profit share
percentage depending upon the per share price of the Common Stock
on the day such sale was completed and (iv) N&M agreed to vote the
Subject Shares in accordance with the instructions of BCL, unless
such instructions were against N&M's manifest interest. The
Schedule 13D indicates that the provisions of such agreement
described in items (i), (ii) and (iv) above have been terminated.
The Schedule 13D also indicates that DHL, LLI and FIL have each
entered into agreements pledging all of their respective holdings
of Common Stock to DnB and Workships and Greenwing have each enter-
ed into agreements pledging all of their respective holdings of
Common Stock to ING Bank. DnB has filed its own Schedule 13D, as
most recently amended on May 13, 1994, stating that due to certain
defaults on loans secured by the pledges of Common Stock by DHL,
LLI and FIL and on loans to the parents of each of such entities
secured by pledges of capital stock of DHL, LLI and FIL, DnB may
be considered to be the beneficial owner of 5,223,540 shares of
Common Stock (excluding shares in which DHL, LLI and FIL may have
an indirect beneficial ownership interest as general partners of
BCL, as described above), which beneficial ownership is
disclaimed. As a result of such defaults, DnB has taken
effective control over DHL, LLI and FIL by replacing the
directors and officers thereof with persons designated by DnB.
In the event DnB forecloses upon all or any of the Common Stock
owned by DHL, LLI and FIL, the Irrevocable Proxies and Refusal
Rights granted by DHL, LLI and FIL with respect to such
foreclosed upon Common Stock will automatically terminate and, as
a result thereof, the number (and percentage) of outstanding
shares of Common Stock controlled by BCL would be reduced. See
"Risk Factors -- Control by Certain Stockholders".
(4) Based upon information contained in a Schedule 13D, as amended as
of February 14, 1994, as filed by WHR Management Company, L.P.
("WHR"), as general partner of the other WHR Partnerships, and
upon certain other information available to the Company. According
to WHR's Schedule 13D and other information available to the
Company, WHR beneficially owns the 127,211 Shares it holds
directly and the 3,768,969 Shares held by the other WHR
Partnerships, for a total of 3,896,180 Shares. Martin J. Whitman,
James P. Heffernan and C. Kirk Rhein, Jr. are general partners of
WHR. Each of Messrs. Whitman, Heffernan and Rhein disclaims
beneficial ownership of the Common Stock held by the WHR Partner-
ships. Mr. Rhein serves as Vice Chairman and director of the
Company. Pursuant to an agreement between the Company and R&B
Investment Partners, L.P., certain compensation and benefits (in-
cluding an award of 90,000 shares of restricted Common Stock to
Mr. Rhein under the Company's 1992 Long-Term Incentive Plan) are
payable to WHR Management Company, L.P. Such restricted stock
award shares are included in the shares listed for such firm in
the table above, and Mr. Rhein disclaims beneficial ownership of
such shares. See "Risk Factors -- Control by Certain Stockholders".
</TABLE>
Of the Shares included in the above table, 4,230,235 Shares were
issued pursuant to the Issuance Agreements in connection with the
Company's repurchase of Lease Debt in September 1994 and 21,708,567
Shares were issued in connection with the Company's recapitalization
in March 1991, which involved the issuance of approximately 39.6
million shares of Common Stock and the incurrence of approximately
$76.2 million in senior secured obligations in exchange for the
elimination of approximately $414.6 million of existing obligations
relating to a prior debt and equity restructuring by the Company in
September 1989. See "Risk Factors -- Shares Eligible for Future
Sale" herein and "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Financial Condition" in the
Company's Annual Report on Form 10-K for the year ended December 31,
1993 which is incorporated herein by reference.
For more than the past three years, certain of the Selling
Stockholders have engaged in various transactions with the Company in
the course of providing financing to the Company and in connection
with the Company's 1989 restructuring and 1991 recapitalization. See
"Risk Factors -- Shares Eligible for Future Sale". Reference is made
to Items 7, 10, 11, 12 and 13 of the Company's Annual Report on Form
10-K for the year ended December 31, 1993, which is incorporated
herein by reference.
Pursuant to the Registration Rights Agreement and the Issuance
Agreements, the Company has agreed to pay certain fees, disbursements
and expenses of the offering, and substantially all of the expenses
of the Selling Stockholders with respect to the offering of Shares
contemplated hereby, including all registration and filing fees,
printing expenses, the Company's auditors' fees, listing fees,
registrar and transfer agent's fees, certain fees and disbursements
of counsel to the Selling Stockholders in connection with such
offering, fees and disbursements of outside counsel to the Company,
expenses of complying with applicable securities or "blue sky" laws
and the fees of the National Association of Securities Dealers, Inc.
in connection with its review, if any, of such offering. The Company
estimates aggregate expenses payable by the Company to be $117,500.
PLAN OF DISTRIBUTION
Each Registration Statement is a "shelf" registration pursuant
to Rule 415 ("Rule 415") promulgated by the Commission under the
Securities Act. In relevant part, Rule 415 permits registration of
securities for an offering to be made on a continuous basis in the
future where such securities are offered and sold by persons other
than the registrant, the registrant's subsidiary or a person of which
the registrant is a subsidiary.
Pursuant to the Registration Rights Agreement and the Issuance
Agreements, the Company is obligated to keep the registration of the
Shares continuously effective until the earlier to occur of the sale
of such Shares pursuant to the Registration Statements or (i) August
1, 1996 (in the case of 21,708,567 Shares registered pursuant to the
Registration Rights Agreement) or (ii) September 14, 1996 (in the
case of 4,230,235 Shares registered pursuant to the Issuance
Agreements). See "Risk Factors -- Shares Eligible for Future Sale".
Offers and sales of Shares by the respective Selling
Stockholders may be effected from time to time in one or more
transactions, directly by the respective Selling Stockholders, or
through agents, dealers, brokers or underwriters to be designated
from time to time. Such offers or sales may be effected over the
Exchanges (including crosses or block transactions), in negotiated
off-exchange transactions, in coordinated public offerings, in a
combination of such methods of sale or by any other legally available
means. The selling price of the Shares may be at market prices
prevailing at the time of sale, at prices related to such prevailing
market prices, at fixed prices or at negotiated prices. Certain
Selling Stockholders may also from time to time offer Shares in
underwritten or coordinated block transactions through underwriters,
dealers or agents, who may receive compensation in the form of
underwriting discounts, concessions or commissions from the Selling
Stockholders or the purchasers of Shares for whom they may act as
agents.
At the time any underwritten or coordinated distribution of
Shares is made, to the extent required, a supplement to this
Prospectus will be distributed which will set forth the aggregate
number of Shares being offered and the terms of the offering,
including the name or names of any participating Selling
Stockholders, underwriters, dealers or agents, any discounts,
commissions and other items constituting compensation from the
Selling Stockholders and any discounts, commissions or concessions
allowed or reallowed or paid to dealers.
Selling Stockholders and any underwriters, dealers and agents
participating in an underwritten or coordinated distribution of the
Shares may be deemed to be underwriters, and any discounts or
commissions received by them and any profit received by them on the
resale of the Shares may be deemed to be underwriting discounts and
commissions, under the Securities Act. Selling Stockholders,
underwriters, dealers and agents who participate in the distribution
of the Shares, and their officers, directors and controlling persons,
may be, under certain circumstances, entitled under, or in accordance
with, the Registration Rights Agreement or the Issuance Agreements to
indemnification by the Company against certain liabilities, including
liabilities under the Securities Act, or to contribution with respect
to payments that such persons may be required to make in respect of
such liabilities. Underwriters, dealers and agents may engage in
transactions with, or perform services for, the Company and its
subsidiaries in the ordinary course of their respective businesses.
In order to comply with the securities laws of certain states,
if applicable, the Shares will be sold in such jurisdictions only
through registered or licensed brokers or dealers. In addition, in
certain states the Shares may not be sold unless the Shares have been
registered or qualified for sale in such state or an exemption from
registration or qualification is available and complied with.
VALIDITY OF SHARES
Certain legal matters in connection with the Shares offered
hereby will be passed upon by Wayne K. Hillin, Esq., Senior Vice
President, General Counsel and Secretary of the Company. As of the
date of this Prospectus, Mr. Hillin was the beneficial owner of
10,505 shares of Common Stock and holds options to purchase an
additional 80,000 shares of Common Stock, 80% of which were
exercisable as of September 30, 1994.
EXPERTS
The consolidated balance sheet as of December 31, 1993 and 1992
and the consolidated statements of operations, cash flows and
stockholders' equity (deficit) for the two years ended December 31,
1993 incorporated by reference in this Prospectus and elsewhere in
the Registration Statements have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their reports with
respect thereto, and together with the related schedules are
incorporated by reference herein in reliance upon the authority of
said firm as experts in accounting and auditing in giving said
reports.
With respect to the unaudited interim financial information for
the quarters ended March 31, 1994, June 30, 1994 and September 30,
1994, Arthur Andersen LLP has applied limited procedures in accordance
with professional standards for a review of that information. However,
their separate reports thereon state that they did not audit and they
do not express an opinion on that interim financial information.
Accordingly, the degree of reliance of their reports on that infor-
mation should be restricted in light of the limited nature of the re-
view procedures applied. In addition, the accountants are not subject
to the liability provisions of Section 11 of the Securities Act of
1933 for their reports on the unaudited interim financial information
because neither report is a "report" or a "part" of the Registration
Statements prepared or certified by the accountants within the
meaning of Sections 7 and 11 of the Act.
The Company's consolidated financial statements as of December
31, 1991 and for the year ended December 31, 1991, included in the
Company's Annual Report on Form 10-K for the year ended December 31,
1993 and incorporated by reference in this Prospectus, have been
incorporated by reference herein in reliance on the report of Coopers
& Lybrand L.L.P., independent public accountants, given on the
authority of that firm as experts in accounting and auditing.
<PAGE>
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No person is authorized to give
any information or to make any
representation not contained in 25,938,802 Shares
this Prospectus, and, if given or
made, such information or
representation must not be relied
upon as having been authorized by
the Company, any Selling
Stockholder or any underwriter.
This Prospectus does not
constitute an offer to sell, or a
solicitation of an offer to buy, READING & BATES CORPORATION
any security other than the
securities offered hereby, nor
does it constitute an offer to
sell, or a solicitation of an
offer to buy, any of the
securities offered hereby to any
person in any jurisdiction in
which it is unlawful to make such
offer or solicitation. Neither
the delivery of this Prospectus Common Stock
nor any sale made hereunder
shall, under any circumstances,
create an implication that there
has been no change in the affairs
of the Company since the date
hereof or that the information
herein is correct as of any time
subsequent to its date.
______________________
Prospectus
TABLE OF CONTENTS
November 4, 1994
Available Information
Incorporation by Reference
Risk Factors
The Company
Use of Proceeds
Selling Stockholders
Plan of Distribution
Validity of Shares
Experts
================================ =================================
