PROSPECTUS RULE 424(b)(3)
33-62727
READING & BATES CORPORATION
12,748,515 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
September 25, 1995 on the New York Stock Exchange Composite Transactions
Tape was $12 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
REPRESENTATION 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 September 26, 1995.
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
450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at its
regional offices at Citicorp 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, 1994, as amended by the Company's Amendment No. 1 on Form
10-K/A dated June 26, 1995; (2) the Company's Quarterly Report on Form
10-Q for the quarter ended March 31, 1995; (3) the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1995; (4) 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; (5) the description of the Company's Preferred Stock
Purchase Rights contained in the Company's Registration Statement on Form
8-A dated March 22, 1995, relating to the Preferred Stock Purchase Rights
and (6) the Company's Current Reports on Form 8-K dated January 9, 1995,
February 16, 1995, February 24, 1995, February 28, 1995, March 2, 1995,
March 3, 1995, March 7, 1995, March 16, 1995, April 6, 1995, April 12,
1995, April 18, 1995, April 19, 1995, April 20, 1995, April 21, 1995, May
2, 1995, May 15, 1995, July 14, 1995, July 19, 1995, August 3, 1995,
August 21, 1995, August 23, 1995, September 11, 1995, September 15, 1995
and September 19, 1995.
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 for a prolonged period of
time. Recently, market conditions have improved substantially. There can
be no assurance that such improvements will continue or that market
conditions will be sustained at current levels. 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 facilities from
borrowing funds from other sources without the consent of the lenders.
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"), a loan
agreement with The CIT Group/Equipment Financing, Inc. (the "CIT Group"),
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 and the agreement with the CIT Group to comply with
certain financial covenants and maintain certain financial ratios. The
ING Facility was amended and restated April 27, 1995, and the Company has
agreed to repay the ING Facility by December 31, 1995. Presently, the
Company is confident in its ability to secure replacement financing prior
to the maturity of the ING Facility and management is now evaluating
financing alternatives available to the Company. No assurance can be
given, however, that the Company will succeed in obtaining financing to
replace the ING Facility. Failure by the Company to comply with any of
the restrictions and provisions under any of the above-referenced
agreements could result in a default under such agreements, 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 income of $2.1 million for the six
months ended June 30, 1995, a net loss applicable to common stockholders
of $22.0 million for the year ended December 31, 1994, net income
applicable to common stockholders of $2.6 million for the year ended
December 31, 1993, and a net loss applicable to common stockholders of
$1.9 million for the year ended December 31,1992.
Shares Eligible for Future Sale
As of September 15, 1995, approximately 15% of the outstanding
Common Stock was held by persons who may be deemed "affiliates" (as
defined in Rule 144) of the Company. Such shares may be eligible for
public resale subject to the volume and manner of sale limitations of Rule
144 under the Securities Act. 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 "1994
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 preceding
business day prior to the Company's offer to repurchase the Lease Debt).
All of such Shares were initially registered on the Registration
Statements of which this Prospectus is a part. Some of such Shares have
previously been sold under the Registration Statements. Pursuant to the
1994 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.
In September 1995, as partial consideration for the purchase by the
Company of the drilling unit the "Eddie Delahoussaye" (formerly the
"Treasure Driller"), the Company issued 1,232,057 shares of Common Stock
in a private placement pursuant to a Common Stock Issuance Agreement (the
"1995 Issuance Agreement") between the Company and DeepFlex Production
Partners L. P., at a price per share of $11.94 (the average of the high
and low trading price of the Common Stock on the New York Stock Exchange
on August 30, 1995, the last preceding business day prior to the execution
of definitive agreements with respect to the Company's offer to purchase
the drilling unit). All of such Shares are registered on one of the
Registration Statements of which this Prospectus is a part. Pursuant to
the 1995 Issuance Agreement, 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 the first anniversary
of the effectiveness of such registration or the sale of all of such
Shares pursuant to any such registration.
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. 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. The Preferred Stock
Purchase Rights approved by the Company's Board of Directors in March 1995
may render more difficult or discourage attempts to acquire the Company
without the prior approval of the Board of Directors. 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 without the prior approval of the Board of Directors.
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, six 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>
Number Percent
of shares Number of total
which may of shares shares
be offered owned outstanding
Number pursuant if all owned upon
Selling shares to this shares are completion
Stockholder owned(1) Prospectus sold (1)(2) of offering
--------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Forreal Inc. (3) 73,227 73,227 0 *
DeepFlex Production
Services, Inc. 1,232,057 1,232,057 0 *
Grace Brothers,
Ltd. 352,100 352,100 0 *
Greenwing Investments,
Inc. (3) 25,220 25,220 0 *
Greenwing
Ltd. (3) 1,327,271 1,327,271 0 *
John Hancock Mutual
Life Insurance
Company(4) 3,097,924 1,594,756 1,503,168 2.51%
Knights of
Columbus 159,857 132,000 27,857 *
Massachusetts Mutual
Life Insurance
Company 144,000 144,000 0 *
Pan-American Life
Insurance Company 117,081 87,822 29,259 *
RBY, Ltd. (3) 2,517,409 2,517,409 0 *
Torarica N.V. (3) 146,454 146,454 0 *
Whitman Heffernan
& Rhein Workout
Fund, L.P. (5) 3,646,563 3,646,563 0 *
WHR Management
Company, L.P.(5) 127,211 127,211 0 *
Workships
Intermediaries,
N.V. (3) 1,342,425 1,342,425 0 *
---------- ---------- --------- ----
Total: 14,308,799 12,748,515 1,560,284 2.51%
========== ========== ========= ====
_______________________
* 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 Stockholder 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
March 7, 1995, which was filed by BCL Investment Partners, L.P.
("BCL") and the other reporting persons (the "Reporting Persons")
named therein, and upon certain other information available to the
Company, effective November 14, 1994, the partners of BCL voted to
dissolve BCL, and BCL distributed to its partners substantially all
of its assets, including 60,250 shares of Common Stock held by it.
In addition, BCL conveyed 20,000 shares of Common Stock of the
Company to Greenwing Investments, Inc. ("Greenwing"), to be held in
trust to satisfy liabilities of BCL. To the extent any such shares
remain after Greenwing determines that all liabilities of BCL have
been discharged or provided for, such remaining shares will be
distributed to the former partners of BCL in proportion to their
ownership interests in BCL. The Schedule 13D states that as a
result of such distribution and dissolution, BCL no longer holds any
shares of Common Stock in its name and the Reporting Persons ceased
to constitute or act as a group with respect to their ownership of
shares of Common Stock. Based upon the Schedule 13D and other
information available to the Company, the Company believes that Dr.
Willem Cordia and Dr. Macko Laqueur (a director of the Company)
control Workship Intermediaries, N.V. and Paul B. Loyd, Jr., the
Company's chairman and chief executive officer, controls Greenwing
Ltd. ("Ltd.") and Greenwing. RBY, Inc. is an indirect wholly-owned
subsidiary of Chemical Banking Corporation. Mr. Arnold L. Chavkin
(a director of the Company) is president of the Chemical Banking
Corporation affiliate which controls RBY, Inc. Workships and
Greenwing Ltd. have each entered into agreements pledging all of
their respective holdings of Common Stock to ING Bank.
(4) Based upon information contained in a Schedule 13G, dated
January 27, 1995, filed by John Hancock Mutual Life Insurance
Company, and upon certain other information available to the
Company.
(5) Based upon information contained in a Schedule 13D, as amended as of
July 14, 1995, as filed by WHR Management Company, L.P., as general
partner of R&B Investment Partnership, L.P. and Whitman Heffernan &
Rhein Workout Fund, L.P. (the "WHR Partnerships"), and upon certain
other information available to the Company. Martin J. Whitman,
James P. Heffernan and C. Kirk Rhein, Jr. are general partners of
WHR Management Company, L.P. Mr. Rhein serves as Vice Chairman and
a director of the Company. Each of Messrs. Whitman, Heffernan and
Rhein disclaims beneficial ownership of the Common Stock held by the
WHR Partnerships. Pursuant to an agreement between the Company and
R&B Investment Partnership, L.P., certain compensation and benefits
(including 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.
</TABLE>
Of the Shares originally included in the Registration Statements of
which this Prospectus is a part, 1,232,057 Shares were issued to DeepFlex
Production Services, Inc. pursuant to the 1995 Issuance Agreement in
connection with the Company's purchase of a drilling unit in September
1995, 4,230,235 Shares were issued pursuant to the 1994 Issuance
Agreements in connection with the Company's repurchase of certain lease
obligations in September 1994 and 31,533,614 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, 1994 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, 1994, which is incorporated herein by reference.
Pursuant to the Registration Rights Agreement, the 1995 Issuance
Agreement and the 1994 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 $80,000.
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, the 1995 Issuance
Agreement and the 1994 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 Shares registered
pursuant to the Registration Rights Agreement), (ii) September 14, 1996
(in the case of Shares registered pursuant to the 1994 Issuance
Agreements) or (iii) the first anniversary of effectiveness of
registration (in the case of Shares registered pursuant to the 1995
Issuance Agreement). 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,
the 1995 Issuance Agreement or the 1994 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.
LEGAL MATTERS
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.
EXPERTS
The consolidated balance sheets as of December 31, 1994 and 1993 and
the consolidated statements of operations, cash flows and stockholders'
equity (deficit) for each of the three years ended in the period December
31, 1994 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 report with respect
thereto, and is incorporated by reference herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving
said report.
With respect to the unaudited interim financial information for the
quarters ended March 31, 1995 and June 30, 1995, 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 on their
reports on that information should be restricted in light of the limited
nature of the review 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.
==================================== ====================================
No person is authorized to give any
information or to make any
representation not contained in 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 12,748,515 Shares
a solicitation of an offer to buy,
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 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.
____________________ READING & BATES CORPORATION
TABLE OF CONTENTS
Available Information . . .
Incorporation by Reference
Risk Factors . . . . . . . . Common Stock
The Company . . . . . . . .
Use of Proceeds . . . . . .
Selling Stockholders . . . .
Plan of Distribution . . . .
Legal Matters . . . . . . .
Experts . . . . . . . . . . Prospectus
September 26, 1995
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