<PAGE> 1
As filed with the Securities and Exchange Commission on June 12, 1997
Registration No. 333-___________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
--------------------
PATTERSON ENERGY, INC.
(Exact name of registrant as specified in charter)
Delaware 75-2504748
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
4510 Lamesa Highway
Snyder, Texas 79549
(915) 573-1104
(Address, including zip code and telephone number, including area code, of
registrant's principal executive offices)
Cloyce A. Talbott
4510 Lamesa Highway
Snyder, Texas 79549
(915) 573-1104
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
Thomas H. Maxfield, Esq.
Baker & Hostetler LLP
303 East Seventeenth Avenue
Suite 1100
Denver, Colorado 80203
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As
soon as practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=========================================================================================================================
Proposed maximum Proposed maximum Amount of
Title of each class of Amount to be offering price aggregate offering registration
securities to be registered registered per share(1) price(1) fee
=========================================================================================================================
<S> <C> <C> <C> <C>
Common Stock, par value $0.01 per share 283,000 Shares $39.875 $11,284,625 $3,420
=========================================================================================================================
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933, as amended, on the
basis of the average of the high and low reported sale prices of the
Registrant's Common Stock on June 9, 1997, as reported on the Nasdaq National
Market.
The Registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE> 2
PROSPECTUS
283,000 SHARES
PATTERSON ENERGY, INC.
COMMON STOCK
Patterson Energy, Inc., a Delaware corporation (the "Company"), is
registering for possible future resale, from time to time, by the holders
thereof (the "Selling Stockholders"), 283,000 shares (the "Shares") of the
Company's common stock, par value $0.01 per share (the "Common Stock"). See
"Selling Stockholders." As a part of the issuance of the Shares, the Company
granted registration rights to certain of the Selling Stockholders. Pursuant
to the terms of these registration rights, the Company is obligated to pay all
fees and expenses incurred by it incident to this offering. It is estimated
that such fees and expenses will be approximately $_______________. The
Company intends to keep the Registration Statement, of which the Prospectus is
a part, effective for a period of no longer than 12 months from the date of
this Prospectus. The Company will not receive any proceeds from the sale of
the Shares.
The Common Stock is traded on the Nasdaq National Market under the
symbol "PTEN." On June ___, 1997, the closing sales price of the Common Stock
was $____________ per share.
-----------------------------
PROSPECTIVE PURCHASERS OF COMMON STOCK SHOULD CONSIDER CAREFULLY THE MATTERS
SET FORTH UNDER "RISK FACTORS" BEGINNING ON PAGE 4.
-----------------------------
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.
-----------------------------
The Selling Stockholders may offer the Shares offered hereby from time
to time to purchasers directly or through agents, brokers or dealers. The
Shares may be sold at market prices prevailing at the time of sale or at
negotiated prices. The agents, brokers or dealers through whom sales are made
may be deemed to be "underwriters" within the meaning of the Securities Act of
1933, as amended (the "Securities Act"), and any amounts received by them in
exchange for their services in connection with such sales may be deemed to be
underwriting commissions. See "Plan of Distribution."
June ___, 1997
<PAGE> 3
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER
TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OFFERED HEREBY BY
ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM 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 CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.
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 may be inspected and copied at the public
reference facilities maintained by the Commission at Judiciary Plaza, Room
1024, 450 Fifth Street, N.W., Washington, D.C. 20549, as well as at the
following regional offices: 7 World Trade Center, Suite 1300, New York, New
York 10048, and Citicorp Center, Suite 1400, 500 West Madison Street, Chicago,
Illinois 60661-2511. Copies of such materials may be obtained at prescribed
rates from the Public Reference Section of the Commission at Judiciary Plaza,
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549. The Company's
Common Stock is traded on the Nasdaq National Market. The foregoing materials
can also be inspected at the National Association of Securities Dealers, Inc.,
1735 K. Street, N.W., Washington, D.C. 20006.
The Company has also filed with the Commission a Registration Statement
on Form S-3 (together with all amendments and exhibits thereto, the
"Registration Statement") under the Securities Act with respect to the Shares
offered hereby. This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information pertaining to the Company and the Shares offered hereby, reference
is made to the Registration Statement, copies of which may be inspected without
charge at the public reference facilities maintained by the Commission at
Judiciary Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and
copies of which may be obtained from the Commission upon payment of the
prescribed fees.
In addition, the Commission maintains a web site that contains reports,
proxy and information statements, and other information regarding registrants
that file electronically with the Commission. The Company is such a filer.
The Commission's web site address is (http://www.sec.gov).
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by the Company with the
Commission, are hereby incorporated by reference into this Prospectus:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996.
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1997.
(c) The Company's Current Report on Form 8-K dated January 3, 1997.
(d) The Company's Current Report on Form 8-K dated January 7, 1997.
(e) The Company's Current Report on Form 8-K dated January 27, 1997.
(f) The Company's Current Report on Form 8-K dated May 7, 1997.
(g) The Company's Current Report on Form 8-K dated June 3, 1997.
(h) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A filed with the Commission under
the Exchange Act.
All documents filed by the Company after the date of this Prospectus
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act and prior to
the termination of the offering hereunder shall be deemed to be incorporated by
reference into this Prospectus and to be a part hereof from the date of filing
of such documents. Any statement contained in a document incorporated or
deemed to be 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 which also is or
is deemed to be 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 provide, without charge to each person to whom a copy
of this Prospectus is delivered, upon the written or oral request of any such
person, a copy of any or all of the documents incorporated herein by reference,
other than exhibits to such documents (unless such exhibits are specifically
incorporated by reference in such documents). Written requests for such copies
should be directed to James C. Brown, Vice President - Finance, Patterson
Energy, Inc., at the Company's principal executive offices located at 4510
Lamesa Highway, Snyder, Texas 79549. Telephone requests may be directed to Mr.
Brown at (915) 573-1104.
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THE COMPANY
The Company is engaged in onshore contract drilling for oil and natural
gas, and, to a lesser extent in the exploration, development and production of
oil and natural gas. The Company owns 87 drilling rigs, 81 of which are
currently operable, and leasehold interests in approximately 59,750 gross
(8,836 net) developed acres, 353 gross (88 net) productive wells, and 114,029
gross (26,498 net) undeveloped acres. The Company's operations are conducted
in the Permian Basin in West Texas and Southeastern New Mexico, in South and
Southeast Texas, primarily in the Austin Chalk Trend, and in the Hardeman Basin
in North Texas. The Company was organized as a Texas corporation in January
1978 and was reorganized as a Delaware corporation in 1993.
RISK FACTORS
In addition to the other information contained in, or incorporated by
reference into, this Prospectus, prospective purchasers in this offering should
carefully consider the following factors relating to the Company and its
businesses and the oil and natural gas industry when evaluating an investment
in the shares offered hereby.
VOLATILITY OF OIL AND NATURAL GAS PRICES. The Company's revenue,
profitability and future rate of growth are substantially dependent upon
prevailing prices for oil and natural gas, both with respect to its contract
drilling operations and its oil and natural gas operations. In recent years,
oil and natural gas prices and, therefore, the level of drilling, exploration,
development and production, have been extremely volatile. Prices are affected
by market supply and demand factors as well as actions of state and local
agencies, the U.S. and foreign governments and international cartels. All of
these factors are beyond the control of the Company. Any significant or
extended decline in oil and/or natural gas prices will have a material adverse
effect on the Company's financial condition and operations and could impair
access to sources of capital.
MARKET CONDITIONS FOR CONTRACT DRILLING SERVICES. The contract drilling
business is currently experiencing increased demand for drilling services due
to stronger oil and natural gas prices. However, the market for onshore
contract drilling services has generally been depressed since mid-1982, when
crude oil and natural gas prices began to weaken. A particularly sharp decline
in demand for contract drilling services occurred in 1986 because of the world-
wide collapse in oil prices (to approximately $10.00 per Bbl in April 1986 in
the U.S.). Since this time and except during the occasional upturns, there
have been substantially more drilling rigs available than necessary to meet
demand in most operating and geographic segments of the domestic drilling
industry. As a result, drilling contractors have had difficulty sustaining
profit margins. In addition to adverse effects that future declines in demand
could have on the Company, ongoing movement or reactivation of onshore drilling
rigs or new construction of drilling rigs could adversely affect rig
utilization rates and pricing, even in an environment of stronger oil and
natural gas prices and increased drilling activity. The Company cannot predict
either the future level of demand for its contract drilling services or future
conditions in the contract drilling industry.
SHORTAGE OF DRILL PIPE IN THE CONTRACT DRILLING INDUSTRY. There is a
growing shortage of drill pipe in the contract drilling industry in the U.S.
This shortage has caused the price of drill pipe to increase significantly over
the past 36 months and has required orders for new drill pipe to be placed at
least one year in advance of expected use. The price increase and the delay in
delivery has caused the Company to substantially increase capital expenditures
in its contract drilling segment over the past 36 months, primarily with
respect to new drill pipe purchases. In the event the shortage continues, the
Company may be unable to obtain the drill pipe required for its contract
drilling operations.
MANAGEMENT OF GROWTH. The Company has experienced rapid and substantial
growth over the past three years, particularly in its contract drilling
segment, and intends to further expand its drilling fleet through selected
acquisitions. Continued growth could strain the Company's management,
operations, employees and resources. There can be no assurance that the
Company will be able to manage growth effectively or that it will be successful
in maintaining the
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<PAGE> 6
market share attributable to operable drilling rigs acquired by the Company.
If the Company is unable to manage its growth, its business, results of
operations or financial condition could be materially adversely affected.
ABILITY TO GROW THROUGH ACQUISITIONS. The Company's growth has been
enhanced materially by strategic acquisitions that have substantially increased
the Company's drilling rig fleet. One element of the Company's strategy is to
make acquisitions in markets in which it currently operates. While the Company
believes that the land drilling industry is highly fragmented and that
significant acquisition opportunities are available, there can be no assurance
that suitable acquisition candidates can be found, and the Company is likely to
face competition from other companies for available acquisition opportunities.
In addition, if the prices paid by buyers of drilling rigs remain at current
levels or continue to rise, the Company may find fewer acceptable acquisition
opportunities. There can be no assurance that the Company will have sufficient
capital resources to complete acquisitions, that acquisitions can be completed
on terms acceptable to the Company or that any completed acquisition would
improve the Company's financial condition, results of operations, business or
prospects in any material manner.
LABOR SHORTAGES. Increases in domestic drilling demand since mid-1995
and recent increases in contract drilling activity have resulted in a shortage
of qualified drilling rig personnel in the industry. If the Company is unable
to attract and retain sufficient qualified personnel, its ability to market and
operate its drilling rigs will be restricted. Further, labor shortages could
result in wage increases, which could reduce the Company's operating margins.
RELIANCE ON KEY PERSONNEL. The Company is highly dependent upon its
executive officers and key employees. The unexpected loss of the services of
any of these individuals, particularly Cloyce A. Talbott or A. Glenn Patterson,
the Chief Executive Officer and the President of the Company, respectively,
could have a detrimental effect on the Company. The Company has no employment
agreements with any of its executive officers. The Company maintains key man
insurance on the lives of Messrs. Talbott and Patterson in the amount of $3
million each.
RISKS OF OIL AND NATURAL GAS EXPLORATION, DEVELOPMENT AND PRODUCTION.
The search for oil and natural gas often results in unprofitable efforts, not
only from dry holes, but also from wells which, though productive, do not
produce oil or natural gas in sufficient quantities to return a profit on the
costs incurred. No assurance can be given that any oil or natural gas reserves
located by the Company in the future will be commercially productive. In
addition, the cost of drilling, completing and operating wells is often
uncertain, and drilling may be delayed or canceled as a result of many factors,
including unacceptably low oil and natural gas prices, oil and natural gas
property title problems, inclement weather conditions and financial instability
of well operators and working interest owners. Furthermore, the availability
of a ready market for the Company's oil and natural gas depends on numerous
factors beyond its control, including demand for and supply of oil and natural
gas, general economic conditions, proximity of natural gas reserves to
pipelines, weather conditions and government regulation.
COMPETITION. The Company encounters intense competition in its contract
drilling operations from other drilling contractors. The competitive
environment for contract drilling services involves such factors as drilling
rates, availability and condition of drilling rigs and equipment, reputation
and customer relations. The Company faces strong competition from major oil
companies, independent oil and natural gas companies and individual producers
and operators in acquiring oil and natural gas leases for exploration and
development. Many of the competitors in each of the Company's lines of
business have substantially greater financial and other resources than the
Company.
OPERATING HAZARDS AND UNINSURED RISKS. Contract drilling and oil and
natural gas activities are subject to a number of risks and hazards which could
cause serious injury or death to persons, suspension of drilling operations and
serious damage to equipment or property of others and, in addition to
environmental damage, could cause substantial damage to producing formations
and surrounding areas. Damages to the environment could result from the
Company's operations, particularly through oil spills, gas leaks, discharges of
toxic gases or extensive uncontrolled fires. In addition, the Company could
become subject to liability for reservoir damages. The occurrence of a
significant event, including pollution or environmental damage, could
materially affect the Company's operations and financial condition. Although
the Company believes that it is adequately insured against normal and
foreseeable risks in its operations in accordance with industry standards, such
insurance may not be adequate to protect the Company against liability from all
consequences of well disasters, extensive fire damage or damage to the
environment. No assurance can be given that the
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Company will be able to maintain adequate insurance in the future at rates it
considers reasonable or that any particular types of coverage will be
available. Furthermore, a portion of the Company's contract drilling is done
on a turnkey basis, which involves substantial economic risks.
ENVIRONMENTAL AND OTHER GOVERNMENTAL REGULATION MATTERS. The Company's
operations are subject to numerous domestic laws and regulations that relate
directly or indirectly to the drilling of oil and natural gas wells, including
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. 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. To date, the Company has not been required to expend
significant resources in order to comply with applicable environmental laws and
regulations nor has it incurred any fines or penalties for noncompliance.
However, compliance costs under existing legal requirements and under any new
requirements could become material, and the Company could incur liability in the
future for noncompliance. Additional matters subject to governmental regulation
include discharge permits for drilling operations, performance bonds, reports
concerning operations, spacing of wells, unitization and pooling of properties,
disposal of produced water and taxation. From time to time, regulatory agencies
have imposed price controls and limitations on production by restricting the
rate of flow of oil and natural gas wells below actual production capacity in
order to conserve supplies of oil and natural gas. In addition, although the
Company performed visual inspections on three yards acquired by it during 1996
and two yards acquired by it during 1997, the Company did not obtain Phase I
environmental reports on any of the yards, which reports, if obtained, may have
revealed potential environmental liabilities not otherwise apparent from the
Company's visual inspection. The Company typically does not have
indemnifications from the respective sellers of the yards for preclosing
environmental liabilities. Accordingly, any loss resulting from environmental
liabilities from any of these yards, or from any other properties acquired or
sold by the Company or its predecessors in interest, may be borne by the
Company.
UNCERTAINTY OF OIL AND NATURAL GAS RESERVE ESTIMATES. Estimates of the
Company's proved developed reserves and future net revenues are based on
engineering reports prepared by an independent petroleum engineer based upon a
review of production histories and other geologic, economic, ownership and
engineering data provided by the Company. These estimates are based on several
assumptions that the Securities and Exchange Commission requires oil and
natural gas companies to use, including for example, constant oil and natural
gas prices. Such estimates are inherently imprecise indications of future net
revenues. Actual future production, revenues, taxes, production costs and
development costs may vary substantially from those assumed in the estimates.
Any significant variance could materially affect the estimates. In addition,
the Company's reserves might be subject to upward or downward adjustment based
on future production, results of future exploration and development, prevailing
oil and natural gas prices and other factors.
CONFLICTS OF INTEREST. Certain of the Company's directors and executive
officers and their respective affiliates have participated and may continue to
participate from time to time in oil and natural gas prospects and properties
in which the Company has an interest. Conflicts of interest may arise between
such persons and the Company as to the advisability of conducting drilling and
recompletion activities on these properties. Of the 249 wells operated by the
Company at March 31, 1997, the Company's directors, officers and/or their
respective affiliates were working interest owners in approximately 106 wells.
NO PAST DIVIDENDS. The Company has paid no cash dividends on the Common
Stock in the past and does not intend to do so in the foreseeable future. The
terms of an existing $30 million bank line of credit prohibit the payment of
dividends by the Company without the prior written consent of the bank.
ANTI-TAKEOVER MEASURES. The Company, a Delaware corporation, is subject
to the General Corporation Law of the State of Delaware, including Section 203,
an anti-takeover law enacted in 1988. The Company has also enacted certain
anti-takeover measures, including a stockholder rights plan. As a result of
these provisions, potential acquirors of the Company may find it more difficult
or be discouraged from attempting to effect an acquisition transaction with the
Company, thereby possibly depriving holders of the Company's securities of
certain opportunities to sell or otherwise dispose of such securities at above-
market prices pursuant to such transactions. See "Description of Capital
Stock."
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SUPERIOR RIGHTS OF PREFERRED STOCK. The Company has a class of
authorized Preferred Stock. The Board of Directors, without stockholder
approval, may issue shares of the Preferred Stock with rights and preferences
adverse to the voting power or other rights of the holders of the Common Stock.
No Preferred Stock has been issued. However, an aggregate of 100,000 shares of
Preferred Stock has been reserved for issuance upon the exercise of the Rights
described under "Description of Capital Stock - Stockholder Rights Plan."
SHARES ELIGIBLE FOR FUTURE SALE. As of the date of this Prospectus, the
Company had 7,367,257 shares of Common Stock outstanding, 6,127,636 of which
are freely tradeable without substantial restriction or the requirement of
future registration under the Securities Act. Of the remaining 1,239,621
shares, 491,621 shares will be held by "affiliates" of the Company, as that
term is defined in Rule 144 under the Securities Act, and may be sold subject
to the provisions of Rule 144, 25,000 shares are eligible for sale under a
shelf registration statement, 283,000 shares are eligible for sale under the
Registration Statement, and 440,000 shares (all of which are "restricted
securities" under Rule 144) are held by third parties. Of these 440,000
shares, a total of 250,000 shares are entitled to certain registration rights
and also may be sold subject to the provisions of Rule 144. In addition, the
Company has reserved for issuance 275,000 shares of Common Stock pursuant to
the exercise of outstanding warrants held by one of the Selling Stockholders
(holding warrants exercisable for 200,000 shares of Common Stock) and by a
third party (holding warrants exercisable for 75,000 shares of Common Stock)
which are entitled to certain registration rights. Also, a total of 40,000
shares of Common Stock issuable upon exercise of outstanding options are
eligible for sale under a shelf registration statement, 94,974 shares of Common
Stock issuable upon the exercise of outstanding options that are vested are
eligible for sale in the public market and 93,850 shares of Common Stock
issuable upon exercise of outstanding options that are not vested will become
eligible for sale in the public market as such options become vested. Sales of
substantial amounts of Common Stock in the public market could adversely affect
the prevailing market price of the Common Stock.
No prediction can be made as to the effect, if any, that future sales of
shares or the availability of shares for sale will have on the market price for
Common Stock prevailing from time to time. Sales of substantial amounts of
Common Stock in the public market, or the perception of the availability of
shares for sale, could adversely affect the prevailing market price of the
Common Stock and could impair the Company's ability to raise capital through
the sale of its equity securities.
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USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the Shares.
DIVIDEND POLICY
The Company has not paid cash dividends on the Common Stock in the past
and does not expect to pay any cash dividends on the Common Stock in the
foreseeable future. The Company instead intends to retain its earnings to
support the operations and growth of its businesses. Any future cash dividends
would depend on future earnings, capital requirements, the Company's financial
condition and other factors deemed relevant by the Board of Directors. In
addition, the terms of an existing $30 million bank line of credit prohibit
payment of dividends by the Company without the prior written consent of the
bank.
SELLING STOCKHOLDERS
The following table sets forth certain information with respect to the
Selling Stockholders and the beneficial ownership of Common Stock by them
before and after the offering being made hereby. Such information was provided
to the Company by the Selling Stockholders for inclusion in this Prospectus.
Additional information concerning the Selling Stockholders and the Shares is
set forth in the notes to the table.
<TABLE>
<CAPTION>
Shares Being
Shares Owned Offered Shares Owned
Name Before Offering in the Offering After Offering(1)
---- ---------------------- --------------- --------------------
Number Percent Number Percent
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
Wes-Tex Drilling Company . . . . . . . . . 310,000(2) 4.1% 110,000 200,000 2.6%
Greathouse Foundation . . . . . . . . . . . 111,000(2) 1.5% 111,000 -0- -0-
Greathouse Charitable Remainder Trust . . . 62,000(2) * 62,000 -0- -0-
</TABLE>
- ---------------
* Less than 1%.
(1) Assumes all Shares offered hereby are sold.
(2) These shares were issued in June 1997 as partial consideration for the
acquisition of 21 drilling rigs, related equipment and rolling stock and
a shop and a yard from Wes-Tex Drilling Company ("Wes-Tex"). The
310,000 shares stated in the table as owned by Wes-Tex include 200,000
shares underlying three-year warrants to purchase shares of Common Stock
at $32.00 per share issued to Wes-Tex as partial consideration for the
acquisition. The Shares being offered are being sold pursuant to
registration rights granted in the acquisition.
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DESCRIPTION OF CAPITAL STOCK
The Company is authorized to issue (i) 9,000,000 shares of Common Stock,
$0.01 Par Value, of which 7,367,257 shares are issued and outstanding as of the
date of this Prospectus, and (ii) 1,000,000 shares of Preferred Stock, $0.01
Par Value, of which no shares have been issued. Stockholders of the Company
will consider and vote upon a proposal at the 1997 Annual Meeting of
Stockholders to be held on July 1, 1997, to amend the Restated Certificate of
Incorporation of the Company to increase the Company's Common Stock from
9,000,000 shares to 18,000,000 shares.
COMMON STOCK
Holders of Common Stock are entitled to one vote for each share of
Common Stock held of record on all matters submitted to a vote of stockholders.
Holders of a majority of the shares of Common Stock outstanding may authorize a
merger, consolidation, dissolution of the Company, the sale of all or
substantially all of the Company's assets if not made in the usual or ordinary
course of the Company's business, or an amendment of the Company's Restated
Certificate of Incorporation. In the event of liquidation, holders of Common
Stock are entitled to share pro rata in any distribution of the Company's
assets to holders of Common Stock after payment of liabilities and liquidation
preferences, if any, granted to holders of Preferred Stock. There are no
preemptive, subscription, conversion or redemption rights regarding the Common
Stock. Holders of Common Stock are entitled to receive such dividends as may
be declared on the Common Stock by the Board of Directors in its discretion out
of funds legally available for that purpose.
PREFERRED STOCK
Preferred Stock may be issued in series from time to time with such
designations, relative rights, priorities, preferences, qualifications,
limitations and restrictions thereof, to the extent that such are not fixed in
the Company's Restated Certificate of Incorporation, as the Board of Directors
determines. The rights, preferences, limitations and restrictions of different
series of Preferred Stock may differ with respect to dividend rates, amounts
payable on liquidation, voting rights, conversion rights, redemption
provisions, sinking fund provisions and other matters. The Board of Directors
may authorize the issuance of Preferred Stock which ranks senior to the Common
Stock with respect to the payment of dividends and the distribution of assets
on liquidation. In addition, the Board of Directors is authorized to fix the
limitations and restrictions, if any, upon the payment of dividends on Common
Stock to be effective while any shares of Preferred Stock are outstanding. The
Board of Directors, without stockholder approval, can issue Preferred Stock
with voting and conversion rights which could adversely affect the voting power
of the holders of Common Stock. The issuance of Preferred Stock may have the
effect of delaying, deferring or preventing a change in control of the Company.
The Company has not issued any shares of Preferred Stock. However, an
aggregate of 100,000 shares of Preferred Stock have been reserved for issuance
upon exercise of the Rights described under "-- Stockholder Rights Plan."
STOCKHOLDER RIGHTS PLAN
General. In January 1997, the Board of Directors of the Company
declared a dividend distribution of one preferred share purchase right (a
"Right") for each outstanding share of Common Stock. The dividend was paid to
the stockholders of record on January 17, 1997 (the "Record Date"), and with
respect to Common Stock issued thereafter until the Distribution Date (as
defined below), and, in certain circumstances, with respect to Common Stock
issued after the Distribution Date. Except as set forth below, each Right,
when it becomes exercisable, entitles the registered holder to purchase from
the Company one one-hundredth of a share of Series A Participating Preferred
Stock, $0.01 par value (the "Preferred Shares"), of the Company at a price of
$166 per one one-hundredth of a Preferred Share (the "Purchase Price"), subject
to adjustment. The description and terms of the Rights are set forth in a
Rights Agreement (the "Rights Agreement") between the Company and Continental
Stock Transfer & Trust Company, as Rights Agent (the "Rights Agent"), dated as
of January 2, 1997. This summary description of the Rights does not purport to
be complete and is qualified in its entirety by reference to the Rights
Agreement, a copy of which was filed as an exhibit to a Registration Statement
on Form S-3 (File No. 333-18123) filed by the Company with the Commission.
The Rights Agreement. Initially, the Rights will be attached to all
certificates representing Common Stock then outstanding, and no separate Right
Certificates will be distributed. The Rights will separate from the Common
Stock upon the earliest to occur of (i) a person or group of affiliated or
associated persons having acquired beneficial ownership of
9
<PAGE> 11
15% or more of the outstanding shares of Common Stock (except pursuant to a
Permitted Offer, as hereinafter defined), or (ii) 10 days (or such later date
as the Board of Directors may determine) following the commencement of, or
announcement of an intention to make, a tender offer or exchange offer the
consummation of which would result in a person or group becoming an Acquiring
Person (as hereinafter defined) (the earliest of such dates being called the
"Distribution Date"). A person or group whose acquisition of Common Stock
causes a Distribution Date pursuant to clause (i) above is an "Acquiring
Person." The date that a person or group becomes an Acquiring Person is the
"Shares Acquisition Date."
The Rights Agreements provides that, until the Distribution Date, the
Rights will be transferred with and only with the Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the Rights), new
Common Stock certificates issued after the Record Date upon transfer or new
issuance of Common Stock will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date (or earlier redemption or
expiration of the Rights), the surrender for transfer of any certificates for
Common Stock outstanding as of the Record Date, even without such notation or a
copy of a summary of the Rights being attached thereto, will also constitute
the transfer of the Rights associated with the Common Stock represented by such
certificate. As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Common Stock as of the close of business on the
Distribution Date (and to each initial record holder of certain Common Stock
issued after the Distribution Date), and such separate Right Certificates alone
will evidence the Rights.
The Rights are not exercisable until the Distribution Date and will
expire at the close of business on January 2, 2007, unless earlier redeemed by
the Company as described below.
In the event that any person becomes an Acquiring Person (except
pursuant to a tender or exchange offer which is for all outstanding Common
Stock at a price and on terms which a majority of certain members of the Board
of Directors determines to be adequate and in the best interests of the
Company, its stockholders and other relevant constituencies, other than such
Acquiring Person, its affiliates and associates (a "Permitted Offer")), each
holder of a Right will thereafter have the right (the "Flip-In Right") to
receive upon exercise the number of shares of Common Stock or, in the
discretion of the Board of Directors of the Company, of one one-hundredths of a
Preferred Share (or, in certain circumstances, other securities of the Company)
having a value (immediately prior to such triggering event) equal to two times
the Purchase Price. Notwithstanding the foregoing, following the occurrence of
the event described above, all Rights that are, or (under certain circumstances
specified in the Rights Agreement) were, beneficially owned by any Acquiring
Person or any affiliate or associate thereof will be null and void.
In the event that, at any time following the Shares Acquisition Date,
(i) the Company is acquired in a merger or other business combination
transaction in which the holders of all of the outstanding Common Stock
immediately prior to the consummation of the transaction are not the holders of
all of the surviving company's voting power, or (ii) more than 50% of the
Company's assets or earning power is sold or transferred, in either case with
or to an Acquiring Person or any affiliate or associate or any other person in
which such Acquiring Person, affiliate or associate has an interest or any
person acting on behalf of or in concert with such Acquiring Person, affiliate
or associate, or, if in such transaction all holders of Common Stock are not
treated alike, any other person, then each holder of a Right (excepts Rights
which previously have been voided as set forth above) shall thereafter have the
right (the "Flip-Over Right") to receive, upon exercise, common shares of the
acquiring company having a value equal to two times the Purchase Price. The
holder of a Right will continue to have the Flip-Over Right whether or not such
holder exercises or surrenders the Flip-In Right.
The Purchase Price payable, and the number of Preferred Shares, shares
of Common Stock or other securities issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Preferred Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred Shares at a
price, or securities convertible into Preferred Shares with a conversion price,
less than the then current market price of the Preferred Shares or (iii) upon
the distribution to holders of the Preferred Shares of evidences of
indebtedness or assets (excluding regular quarterly cash dividends) or of
subscription rights or warrants (other than those referred to above).
The number of outstanding Rights and the number of one one-hundredths of
a Preferred Share issuable upon exercise of each Right are also subject to
adjustment in the event of a stock split of the Common Stock or a stock
dividend on the
10
<PAGE> 12
Common Stock payable in Common Stock or subdivisions, consolidations or
combinations of the Common Stock occurring, in any such case, prior to the
Distribution Date.
Description of Preferred Shares. Preferred Shares purchasable upon
exercise of the Rights will not be redeemable. Each Preferred Share will be
entitled to a minimum preferential quarterly dividend payment of $0.01 per
share but, if greater, will be entitled to an aggregate dividend per share of
100 times the dividend declared per share of Common Stock. In the event of
liquidation, the holders of the Preferred Shares will be entitled to a minimum
preferential liquidation payment of $1.00 per share; thereafter, and after the
holders of the Common Stock receive a liquidation payment of $0.01 per share,
the holders of the Preferred Shares and the holders of the Common Stock will
share the remaining assets in the ratio of 100 to 1 (as adjusted) for each
Preferred Share and share of Common Stock so held, respectively. Finally, in
the event of any merger, consolidation or other transaction in which shares of
Common Stock are exchanged, each Preferred Share will be entitled to receive
100 times the amount received per share of Common Stock. These rights are
protected by customary antidilution provisions. In the event that the amount
of accrued and unpaid dividends on the Preferred Shares is equivalent to six
fully quarterly dividends or more, the holders of the Preferred Shares shall
have the right, voting as a class, to elect two directors in addition to the
directors elected by the holders of the Common Stock until all cumulative
dividends on the Preferred Shares have been paid through the last quarterly
dividend payment date or until noncumulative dividends have been paid regularly
for at least one year.
Redemption. At any time prior to the earlier to occur of (i) a person
becoming an Acquiring Person or (ii) the expiration of the Rights, and under
certain other circumstances, the Company may redeem the Rights in whole, but
not in part, at a price of $0.01 per Right (the "Redemption Price"), which
redemption shall be effective upon the action of the Board of Directors.
Additionally, following the Shares Acquisition Date, the Company may redeem the
then outstanding Rights in whole, but not in part, at the Redemption Price
provided that such redemption is in connection with a merger or other business
combination transaction or series of transactions involving the Company in
which all holders of Common Stock are treated alike but not involving an
Acquiring Person or its affiliates or associates.
Anti-Takeover Effect. The distribution of the Rights may have the
effect of delaying, deferring or preventing a change in control of the Company
notwithstanding that a majority of the stockholders might benefit from such a
change in control.
OTHER PROVISIONS HAVING POSSIBLE ANTI-TAKEOVER EFFECT
Delaware, like many other states, permits a corporation to adopt a
number of measures through amendment of the corporate charter or bylaws or
otherwise, which, along with certain provisions of the Delaware General
Corporation Law (the "DGCL"), may have the effect of delaying or deterring any
unsolicited takeover attempts notwithstanding that a majority of the
stockholders might benefit from such a takeover or attempt. In connection with
the Company's reincorporation, the right of stockholders to cumulate votes in
the election of directors was eliminated. In addition, Section 203 of the
DGCL, which will apply to the Company since the Common Stock has been approved
for quotation on the Nasdaq National Market, restricts certain "business
combinations" with an "interested stockholder" for three years following the
date such person becomes an interested stockholder, unless the Board of
Directors approves the business combination. "Business combination" is defined
to include mergers, sale of assets and other similar transactions with an
"interested stockholder." An "interested stockholder" is defined as a person
who, together with affiliates and associates, owns (or, within the prior three
years, did own) 15% or more of the corporation's voting stock. By delaying or
deterring unsolicited takeover attempts, these provisions could adversely
affect prevailing market prices for the Company's Common Stock.
The Company's Restated Certificate of Incorporation and Bylaws contain
certain provisions that could discourage potential takeover attempts and make
more difficult attempts by stockholders to change management. The following
paragraphs set forth a summary of these provisions:
Special Meetings of Stockholders. The Restated Certificate of
Incorporation provides that special meetings of stockholders may be called only
by the Board of Directors (or a majority of the members thereof), the Chief
Executive Officer, the President or the holders of a majority of the
outstanding stock entitled to vote at such special meeting. This provision
will make it more difficult for stockholders to call a special meeting.
11
<PAGE> 13
No Stockholder Action by Written Consent. The Restated Certificate of
Incorporation provides that stockholder action may be taken only at annual or
special meetings and not by written consent of the stockholders.
Advance Notice Requirements for Stockholder Proposals and Director
Nominations. The Bylaws provide that stockholders seeking to bring business
before an annual meeting of stockholders, or to nominate candidates for
election as directors at an annual meeting of stockholders, must provide timely
notice thereof in writing. To be timely, a stockholder's notice must be
delivered to, or mailed and received at, the principal executive offices of the
Company not less than 30 days nor more than 60 days prior to the meeting as
originally scheduled; provided that in the event less than 40 days written
notice is given to stockholders, notice by the stockholder to be made timely
must be received not later than the close of business on the 10th day following
the day on which such notice of the date of the annual meeting was mailed.
These Bylaws also specify certain requirements for a stockholder's notice to be
in proper written form. These provisions may preclude some stockholders from
bringing matters before the stockholders at an annual meeting or from making
nominations for directors at an annual meeting.
Authorized Class of Preferred Stock. See "-- Preferred Stock" for
information concerning the Company's Preferred Stock.
TRANSFER AGENT
The transfer agent for the Common Stock is Continental Stock Transfer &
Trust Company, New York, New York.
PLAN OF DISTRIBUTION
The distribution of the Shares by the Selling Stockholders may be
effected from time to time in one or more transactions (which may involve block
transactions) on the Nasdaq National Market or otherwise, in negotiated
transactions, or a combination of such methods of sale, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices. The Selling Stockholders may effect such
transactions by selling the Shares to or through broker dealers, and such
broker-dealers may receive compensation in the form of underwriting discounts,
concessions or commissions from the Selling Stockholders or purchasers of
Shares for whom they may act as agent (which compensation may be in excess of
customary commissions). Such brokers or dealers may be deemed to be
"underwriters" within the meaning of the Securities Act in connection with such
sales and any commissions received by them may be deemed to be underwriting
compensation.
In accordance with applicable rules and regulations promulgated under
the Exchange Act, any person engaged in the distribution of any of the Shares
may not simultaneously engage in market activities with respect to any of the
Common Stock for a period of nine business days prior to the commencement of
such distribution. In addition and without limiting the foregoing, the Selling
Stockholders may be subject to applicable provisions of the Exchange Act and
the rules and regulations promulgated thereunder, including, without
limitation, Regulation M, which provisions may limit the timing of purchases
and sales of Shares by the Selling Stockholders.
The Company and the Selling Stockholders have agreed to indemnify each
other against certain liabilities, including liabilities, under the Securities
Act.
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon for the
Company by Baker & Hostetler LLP, Denver, Colorado.
12
<PAGE> 14
EXPERTS
The consolidated balance sheets as of December 31, 1995 and 1996, and
the consolidated statements of income, stockholders' equity and cash flows for
each of the three years in the period ended December 31, 1996, incorporated by
reference in this Prospectus, have been included herein in reliance on the
report of Coopers & Lybrand L.L.P., independent accountants, given on the
authority of that firm as experts in auditing and accounting. With respect to
the unaudited interim financial information for the periods ended March 31,
1996 and 1997, incorporated by reference in this Prospectus, the independent
accountants have reported that they have applied limited procedures in
accordance with professional standards for a review of such information.
However, their separate report included in the Company's quarterly report on
Form 10-Q for the quarter ended March 31, 1997, and incorporated by reference
herein, states that they did not audit and they do not express an opinion on
that interim financial information. Accordingly, the degree of reliance on
their report on such information should be restricted in light of the limited
nature of the review procedures applied. The accountants are not subject to
the liability provisions of Section 11 of the Securities Act of 1933 for their
report on the unaudited interim financial information because that report is
not a "report" or a "part" of the registration statement prepared or certified
by the accountants within the meaning of Sections 7 and 11 of the Securities
Act.
The 1994 and 1995 financial statements of Patterson Drilling Company
(formerly, Tucker Drilling Company, Inc.) incorporated by reference in this
Prospectus and elsewhere in the Registration Statement, have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
report with respect thereto, and are incorporated herein by reference in
reliance upon the authority of said firm as experts in giving said reports.
13
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Capitalized terms used but not defined in Part II have the meanings
ascribed to them in the Prospectus included as part of this Registration
Statement.
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the expenses expected to be incurred in
connection with the issuance and distribution of Common Stock registered
hereby, all of which expenses, except for the Commission registration fee and
the NASD filing fee, are estimates:
<TABLE>
<CAPTION>
DESCRIPTION AMOUNT
----------- ------
<S> <C>
Securities and Exchange Commission registration fee . . . . . . $
Accounting fees and expenses . . . . . . . . . . . . . . . . . *
Legal fees and expenses . . . . . . . . . . . . . . . . . . . . *
Blue Sky fees and expenses . . . . . . . . . . . . . . . . . . *
Miscellaneous expenses . . . . . . . . . . . . . . . . . . . . *
-------------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
==============
</TABLE>
- ------------------
* To be completed by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The DGCL provides for indemnification by a corporation of costs incurred
by directors, employees and agents in connection with an action, suit or
proceeding brought by reason of their position as a director, employee or
agent. The person being indemnified must have acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the corporation. The DGCL provides that a corporation may advance payment of
expenses. The DGCL further provides that the indemnification and advancement
of expenses provisions of the DGCL will not be deemed exclusive of any other
rights to which these indemnifications or advancements of expenses may be
entitled under bylaw, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action under official capacity and as to
action in another capacity when holding such office.
In addition to the general indemnification section, Delaware law
provides further protection for directors under Section 102(b)(7) of the DGCL.
This section was enacted in June 1986 and allows a Delaware corporation to
include in its certificate of incorporation a provision that eliminates and
limits certain personal liability of a director for monetary damages for
certain breaches of the director's fiduciary duty of care, provided that any
such provision does not (in the words of the statute) do any of the following:
"eliminate or limit the liability of a director (i) for any breach of
the director's duty of loyalty to the corporation or its stockholders,
(ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under
Section 174 of this Title [dealing with willful or negligent violation
of the statutory provision concerning dividends and stock purchases and
redemptions], or (iv) for any transaction from which the director
derived an improper personal benefit. No such provision shall eliminate
or limit the liability of a director for any act or omission occurring
prior to the date when such provision becomes effective...."
II-1
<PAGE> 16
The Board of Directors is empowered to make other indemnification as
authorized under any bylaw, agreement, the Certificate of Incorporation, Bylaws
or corporate resolution so long as the indemnification is consistent with the
DGCL.
The Company's Certificate of Incorporation provides that, to the fullest
extent permitted by the DGCL, a director of the Company will not be liable to
the Company or its stockholders for monetary damages for breach of fiduciary
duty as a director. The Company's Bylaws provide that to the extent that a
director or officer of the Company is successful on the merits of defense of a
suit or proceeding brought against him by reason of the fact that he is a
director or officer of the Company, he shall be indemnified against expenses
(including attorneys' fees) reasonably incurred in connection with such action.
In other circumstances, a director or officer of the Company may be indemnified
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in and not opposed to the best interest of the
Company, and, with respect to a criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful; however, in an action or
suit by or in the right of the Company to procure a judgment in its favor, such
person will not be indemnified if he has been adjudged to be liable to the
Company unless and only to the extent that the Delaware Court of Chancery or
the court in which such action or suit was brought determines upon application
that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
deems proper. A determination that indemnification of a director or officer is
proper will be made by a disinterested majority of the Company's Board of
Directors, by independent legal counsel or by the stockholders of the Company.
The Company's Bylaws also provide that the Company may advance the payment of
expenses and that the indemnification and advancement of expenses provisions of
the Bylaws are nonexclusive. The Company maintains director and officer
liability insurance covering director and officer indemnification.
ITEM 16. EXHIBITS.
The following exhibits are filed herewith or incorporated by reference
herein:
<TABLE>
<CAPTION>
Exhibit Item 601 Cross
Number Reference Document as Form S-3 Exhibit
------ --------------- ----------------------------
<S> <C> <C>
5.1 5 Opinion of Baker & Hostetler LLP regarding legality of the Shares to be
offered
23.1 23 Consent of Coopers & Lybrand L.L.P.
23.2 23 Awareness Letter of Coopers & Lybrand L.L.P.
23.3 23 Consent of Arthur Andersen LLP
23.4 23 Consent of M. Brian Wallace, independent petroleum engineer
23.5 23 Consent of Baker & Hostetler LLP (included in Exhibit 5.1)
24.1 24 Powers of Attorney (included on the signature page hereto)
</TABLE>
II-2
<PAGE> 17
ITEM 17. UNDERTAKINGS.
1. The Company hereby undertakes:
(a) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section
10(a)(3) of the Securities Act of 1933, unless the information
required to be included in such post-effective amendment is
contained in a periodic report filed by the Company pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of
1934 and incorporated herein by reference;
(ii) to reflect in the Prospectus any facts or events
arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the Registration Statement,
unless the information required to be included in such post-
effective amendment is contained in a periodic report filed by
the Company pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 and incorporated herein by
reference;
(iii) to include any material information with respect to
the plan of distribution not previously disclosed in the
Registration Statement or any material change to such information
in the Registration Statement;
Provided, however, that paragraphs (1)(a)(i) and
(1)(a)(ii) do not apply if the information required to be
included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the Company pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in this Registration
Statement.
(b) That, for the purposes of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(c) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(d) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Company's annual report
pursuant to Section 13(a) or Section 15(d) of the Securities Exchange
Act of 1934 that is incorporated by reference in this Registration
Statement shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
2. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Securities Act") may be permitted to directors,
officers and controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the Company of expenses incurred or paid by a director, officer
or controlling person of the Company in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Company will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
II-3
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Snyder, State of Texas on the 12th day of June,
1997.
PATTERSON ENERGY, INC.
By: /s/ A. Glenn Patterson
----------------------------------
A. Glenn Patterson, President
Each of the undersigned officers and directors of Patterson Energy, Inc.
hereby appoints Cloyce A. Talbott, as attorney and agent for the undersigned,
with full power of substitution, for and in the name, place and stead of the
undersigned, to sign and file with the Securities and Exchange Commission under
the Securities Act of 1933 any and all amendments (including post-effective
amendments) and exhibits to this Registration Statement and any and all
applications, instruments or documents to be filed with the Securities and
Exchange Commission pertaining to the registration of the securities covered
hereby, with full power and authority to do and perform any and all acts and
things whatsoever requisite and necessary or desirable.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed as of June 12, 1997, by the following
persons in the capacities indicated:
<TABLE>
<S> <C>
/s/ Cloyce A. Talbott Chairman of the Board, Director and Chief
- ----------------------------------------- Executive Officer
Cloyce A. Talbott
Principal Executive Officer
/s/ Glenn Patterson President, Chief Operating Officer and Director
- -----------------------------------------
A. Glenn Patterson
/s/ Robert C. Gist Director
- -----------------------------------------
Robert C. Gist
/s/ Kenneth E. Davis Director
- -----------------------------------------
Kenneth E. Davis
/s/ Vincent A. Rossi, Jr. Director
- -----------------------------------------
Vincent A. Rossi, Jr.
/s/ James C. Brown Vice President--Finance, Secretary and Treasurer
- ----------------------------------------- and Chief Financial Officer
James C. Brown
(Principal Accounting Officer)
</TABLE>
II-4
<PAGE> 19
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION Page No.
------ ----------- --------
<S> <C>
5.1 Opinion of Baker & Hostetler LLP regarding legality of Shares to be
offered
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Awareness Letter of Coopers & Lybrand L.L.P.
23.3 Consent of Arthur Andersen LLP
23.4 Consent of M. Brian Wallace, independent petroleum engineer
23.5 Consent of Baker & Hostetler LLP (included in Exhibit 5.1)
24.1 Powers of Attorney (included in the signature page hereto)
</TABLE>
<PAGE> 1
EXHIBIT 5.1
June 12, 1997
Patterson Energy, Inc.
4510 Lamesa Highway
Snyder, Texas 79549
Gentlemen:
We have acted as counsel for Patterson Energy, Inc. (the
"Company") in connection with the registration under the Securities Act of 1933
(the "Act") on Form S-3 of a total of 283,000 shares (the "Shares") of the
Company's issued and outstanding Common Stock, $0.01 par value, to be sold by
certain stockholders of the Company. The Registration Statement on Form S-3
and exhibits thereto filed with the Securities and Exchange Commission under
the Act are referred to herein as the "Registration Statement."
We have examined the Restated Certificate of Incorporation of the
Company, the Bylaws of the Company, the Minutes of the Board of Directors and
stockholders of the Company, the applicable laws of the State of Delaware and a
copy of the Registration Statement.
Based on the foregoing and having regard for such legal
considerations as we deem relevant, we are of the opinion that the Shares have
been validly issued and are fully paid and nonassessable.
We hereby consent to the use of this opinion as part of the
Registration Statement.
Very truly yours,
/s/ Baker & Hostetler LLP
BAKER & HOSTETLER LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration
Statement of Patterson Energy, Inc. on Form S-3 of our report dated March 10,
1997, on our audits of the consolidated financial statements of Patterson
Energy, Inc. as of December 31, 1995 and 1996 and for each of the three years
in the period ended December 31, 1996, which is included in Patterson Energy,
Inc.'s Annual Report on Form 10-K for the fiscal year ended December 31, 1996.
We also consent to the reference to our firm under the caption "Experts."
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
June 12, 1996
<PAGE> 1
EXHIBIT 23.2
June 12, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Patterson Energy, Inc.
Registration on Form S-3
We are aware that our report dated April 30, 1997 on our review of interim
financial information of Patterson Energy, Inc. for the period ended March 31,
1997 and included in the Company's Quarterly Report on Form 10-Q for the
quarter then ended is incorporated by reference in this registration statement.
Pursuant to Rule 436(c) under the Securities Act of 1933, this report should
not be considered a part of the registration statement prepared or certified by
us within the meaning of Sections 7 and 11 of that Act.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
<PAGE> 1
EXHIBIT 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our report dated May 16, 1996,
included in the Patterson Energy, Inc., Annual Report on Form 10-K for the year
ended December 31, 1996, and to all references to our firm included in this
Registration Statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
San Antonio, Texas
June 11, 1997
<PAGE> 1
Exhibit 23.4
CONSENT OF INDEPENDENT PETROLEUM ENGINEER
I hereby consent to the incorporation by reference in this registration
statement of Patterson Energy, Inc. on Form S-3 of certain information
contained in Patterson Energy, Inc.'s Annual Report on Form 10-K for the fiscal
year ended December 31, 1996, which information is contained in my summary
reserve report dated February 5, 1997, relating to the oil and natural gas
reserves and revenues as of December 31, 1994, 1995 and 1996 of certain
properties owned by Patterson Energy, Inc. as of December 31, 1996.
/s/ M. Brian Wallace
M. Brian Wallace, P.E.
Dallas, Texas
June 12, 1997
