SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM 8-K/A
AMENDMENT NO. 2 TO CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 15, 2002
UNIT CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Oklahoma 1-9260 73-1283193
(State of Incorporation) (Commission File Number) (IRS Employer
Identification No.)
1000 Kensington Tower, Suite 1000
Tulsa, Oklahoma 74136
(ADDRESS OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
918/493-7700
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
(Not Applicable)
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
The undersigned hereby amends its Form 8-K filed August 27, 2002 to include
the related pro forma financial information for the twelve months ended
December 31, 2002.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired
Provided in the original Amended Form 8-K/A filed on
September 20, 2002.
(b) Pro Forma Financial Information
Page in
Pro Forma Financial Information This Report
------------------------------------------ -----------
Set forth below is the pro forma financial
information appearing in this report:
Unaudited Pro Forma Consolidated Condensed
Statement of Operations for the Twelve Months
Ended December 31, 2002 . . . . . . . . . . . . .P-1
Notes to Unaudited Pro Forma Consolidated
Condensed Statement of Operations . . . . . . . .P-2
Signatures. . . . . . . . . . . . . . . . . . . . .P-5
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired
Provided in the original Ammended Form 8-K/A filed on
September 20, 2002.
(b) Pro Forma Financial Information
UNIT CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
For the Twelve Months Ended December 31, 2002
CDC
Drilling
Company Pro Forma
Unit Combined Adjustments
Corporation (Note 2) (Note 3) Pro Forma
---------- ---------- ---------- ----------
(In thousands except per share amounts)
Revenues:
Contract drilling $ 118,173 $ 27,865 $ - $ 146,038
Oil and natural gas 67,959 - - 67,959
Other 1,504 304 - 1,808
---------- ---------- ---------- ----------
Total revenues 187,636 28,169 - 215,805
---------- ---------- ---------- ----------
Expenses:
Contract drilling:
Operating costs 91,338 24,408 3,942 (a) 119,688
Depreciation 14,684 4,941 (597) (b) 19,028
Oil and natural gas:
Operating costs 20,795 - - 20,795
Depreciation,
depletion
and amortization 23,338 - - 23,338
General and administrative 8,712 4,191 (4,191) (a) 8,712
Interest 973 461 (359) (c) 1,075
---------- ---------- ---------- ----------
Total expenses 159,840 34,001 (1,205) 192,636
---------- ---------- ---------- ----------
Income (Loss) Before Income
Taxes 27,796 (5,832) 1,205 23,169
---------- ---------- ---------- ----------
Income Tax Expense (Benefit) 9,552 (2,161) 458 (d) 7,849
---------- ---------- ---------- ----------
Net Income (Loss) $ 18,244 $ (3,671) $ 747 $ 15,320
========== ========== ========== ==========
Net Income Per Common
Share (Note 4):
Basic $ 0.47 $ 0.35
========== ==========
Diluted $ 0.47 $ 0.35
========== ==========
The accompanying notes are an integral part of the unaudited pro
forma consolidated condensed statement of operations.
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UNIT CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
NOTE 1 - THE ACQUISITION
------------------------
On August 15, 2002, Unit Corporation completed the acquisition of CREC Rig
Acquisition Company LLC and CDC Drilling Company (combined "CDC"). Both of the
acquisitions were stock purchase transactions. Under the terms of these
transactions (the "CDC Acquisition"), Unit issued 6,819,748 shares of common
stock and paid $3,813,053 for all the outstanding shares of CREC Rig Acquisition
Company LLC and issued 400,252 shares of common stock and paid $686,947 for all
the outstanding shares of CDC Drilling Company. The consideration paid in both
transactions was determined through arms-length negotiations between the
parties.
The calculation and allocation of the total consideration paid for the
acquisition are as follows (in thousands):
Calculation of Consideration Paid:
Unit Corporation common stock
(7,220,000 shares at $16.96556 per share) $ 122,491
Cash 4,500
----------
Total consideration $ 126,991
==========
Allocation of Total Consideration Paid:
Equipment $ 117,130
Deferred tax asset 2,155
Goodwill 7,706
----------
Total consideration $ 126,991
==========
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NOTE 2 - BASIS OF PRESENTATION
------------------------------
The accompanying unaudited Pro Forma Consolidated Condensed Statement of
Operations are presented to reflect the consummation of the CDC Acquisition. The
unaudited Pro Forma Consolidated Condensed Statements of Operations are
presented as if the acquisition occurred on January 1, 2002 and may not be
indicative of the results that would have occurred if the acquisition had been
effective on the date indicated or of the results that may be obtained in the
future. Since CDC had a fiscal year end of June 30, CDC's Combined results of
operations for the twelve months ended December 31, 2002 were derived from
unaudited information for the seven months and fourteen days ended August 14,
2002. The accompanying unaudited pro forma consolidated condensed statement of
operations should be read in conjunction with the historical financial
statements and notes to financial statements of both Unit Corporation and CDC
Drilling Company.
NOTE 3 - PRO FORMA ADJUSTMENTS
------------------------------
The accompanying unaudited Pro Forma Consolidated Condensed Statement of
Operations include the following adjustments:
(a) Adjustments were made to reduce general and administrative expense
for amounts CDC was billed for services provided by Kaiser-Francis
for management and administrative functions, including accounting,
data processing and human resources administration. Employees
already working in the same capacity for Unit's existing rig fleet
will provide these services. The remaining directly related
general and administrative expense was reclassified to drilling
operating expense to conform with Unit Corporation's financial
statements.
(b) Adjustment provides depreciation expense computed on the
$117,130,000 fair market value of the acquired assets.
Depreciation and amortization of drilling equipment was calculated
using the units-of-production method based on a useful life of 15
years for the acquired rigs, including a minimum provision of 20
percent of the active depreciation rate when the equipment is
idle. Depreciation for drill pipe and drill collars was calculated
using the composite method, which calculates depreciation by
footage actually drilled compared to total estimated remaining
footage. Depreciation of other property and equipment was computed
using the straight-line method over the estimated useful lives of
the assets ranging from 3 to 10 years.
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UNIT CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS -
CONTINUED
(c) Interest expense was adjusted to reflect the interest on the $4.5
million in additional long-term debt incurred in the acquisition
less the debt on note payable to shareholder.
(d) The adjustment to income tax expense represents the increase in
taxes associated with the pro forma adjustments based on the
statutory (federal and state) tax rate.
NOTE 4 - NET INCOME PER COMMON SHARE
------------------------------------
The following data shows the amounts used in computing earnings per share.
For the Twelve Months Ended
December 31, 2002
-------------------------------------------
WEIGHTED
INCOME SHARES PER-SHARE
(NUMERATOR) (DENOMINATOR) AMOUNT
-------------- ------------- ------------
Basic Earnings per
Common Share $ 18,244,000 38,844,000
Effect of Pro Forma
Adjustments (2,924,000) 4,470,000
-------------- -------------
Basic Pro Forma
Earnings per Common
Share 15,320,000 43,314,000 $ 0.35
============
Effect of Dilutive
Stock Options - 268,000
-------------- -------------
Diluted Pro Forma
Earnings per
Common Share $ 15,320,000 43,582,000 $ 0.35
============== ============= ============
Options to purchase 198,500 shares of common stock at an average price of
$19.01 were excluded from the computation of diluted pro forma earnings per
share because the option exercise prices were greater than the average market
price on common shares for the twelve months ended December 31, 2002.
P-4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
UNIT CORPORATION
Dated: December 9, 2003 By: /s/ MARK E. SCHELL
----------------------------
Mark E. Schell
Senior Vice President
P-5