10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2017

Commission File No. 1-8726

RPC, INC.

(Exact name of registrant as specified in its charter)

Delaware	58-1550825
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

2801 Buford Highway, Suite 520, Atlanta, Georgia 30329

(Address of principal executive offices)                      (Zip code)

Registrant’s telephone number, including area code -- (404) 321-2140

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer ☐
Non-accelerated filer	☐ (Do not check if a smaller reporting company)	Smaller reporting company ☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of April 21, 2017, RPC, Inc. had 217,779,939 shares of common stock outstanding.

RPC, INC. AND SUBSIDIARIES Table of Contents
		Page No.
Part I. Financial Information
Item 1.	Financial Statements (Unaudited)
	Consolidated Balance Sheets –As of March 31, 2017 and December 31, 2016	3
	Consolidated Statements of Operations – For the three months ended March 31, 2017 and 2016	4
	Consolidated Statements of Comprehensive Income – For the three months ended March 31, 2017 and 2016	5
	Consolidated Statement of Stockholders’ Equity – For the three months ended March 31, 2017	6
	Consolidated Statements of Cash Flows – For the three months ended March 31, 2017 and 2016	7
	Notes to Consolidated Financial Statements	8 – 18
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19 – 26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	26
Item 4.	Controls and Procedures	26
Part II.  Other Information
Item 1.	Legal Proceedings	27
Item 1A.	Risk Factors	27
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	27
Item 3.	Defaults upon Senior Securities	27
Item 4.	Mine Safety Disclosures	27
Item 5.	Other Information	27
Item 6.	Exhibits	28
Signatures		29

2 

RPC, INC. AND SUBSIDIARIES

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2017 AND DECEMBER 31, 2016

(In thousands)

(Unaudited)

	March 31,			December 31,
	2017			2016
					(Note 1)
ASSETS
Cash and cash equivalents	$	104,498		$	131,835
Accounts receivable, net of allowance for doubtful accounts of $2,956 in 2017 and $2,553 in 2016		246,583			169,166
Inventories		111,945			108,316
Income taxes receivable		48,461			57,174
Prepaid expenses		6,897			6,718
Other current assets		6,269			5,848
Total current assets		524,653			479,057
Property, plant and equipment, less accumulated depreciation of $1,631,602 in 2017 and $1,595,508 in 2016		465,249			497,986
Goodwill		32,150			32,150
Other assets		27,002			26,259
Total assets	$	1,049,054		$	1,035,452
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable	$	92,270		$	70,536
Accrued payroll and related expenses		17,528			12,130
Accrued insurance expenses		4,681			4,099
Accrued state, local and other taxes		4,746			3,094
Income taxes payable		3,805			4,929
Other accrued expenses		1,740			6,680
Total current liabilities		124,770			101,468
Long-term accrued insurance expenses		9,882			9,537
Long-term pension liabilities		33,637			32,864
Deferred income taxes		69,869			81,466
Other long-term liabilities		3,288			3,318
Total liabilities		241,446			228,653
Common stock		21,778			21,749
Capital in excess of par value		—			—
Retained earnings		803,770			803,152
Accumulated other comprehensive loss		(17,940	)		(18,102	)
Total stockholders’ equity		807,608			806,799
Total liabilities and stockholders’ equity	$	1,049,054		$	1,035,452

The accompanying notes are an integral part of these consolidated financial statements.

3 

RPC, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDED MARCH 31, 2017 AND 2016

(In thousands except per share data)

(Unaudited)

	Three months ended
	March 31,
	2017			2016
Revenues	$	298,119		$	189,095
Cost of revenues (exclusive of items shown below)		216,242			161,256
Selling, general and administrative expenses		37,157			43,546
Depreciation and amortization		44,663			60,636
Gain on disposition of assets, net		(1,517	)		(1,256	)
Operating income (loss)		1,574			(75,087	)
Interest expense		(103	)		(325	)
Interest income		129			23
Other income, net		212			342
Income (loss) before income taxes		1,812			(75,047	)
Income tax benefit		(1,822	)		(42,536	)
Net income (loss)	$	3,634		$	(32,511	)
Earnings (loss) per share
Basic	$	0.02		$	(0.15	)
Diluted	$	0.02		$	(0.15	)
Dividends per share	$	—		$	—

The accompanying notes are an integral part of these consolidated financial statements.

4 

RPC, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

FOR THE THREE MONTHS ENDED MARCH 31, 2017 AND 2016

(In thousands)

(Unaudited)

	Three months ended
	March 31,
	2017			2016
Net income (loss)	$	3,634		$	(32,511	)
Other comprehensive income (loss):
Pension adjustment and reclassification adjustment, net of taxes		135			127
Foreign currency translation		42			692
Unrealized loss on securities, net of taxes		(15	)		(9	)
Comprehensive income (loss)	$	3,796		$	(31,701	)

The accompanying notes are an integral part of these consolidated financial statements.

5 

RPC, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2017

(In thousands)

(Unaudited) 

	Common Stock						Capital in Excess of			Retained			Accumulated Other Comprehensive
	Shares			Amount			Par Value			Earnings			Loss			Total
Balance, December 31, 2016		217,489		$	21,749		$	—		$	803,152		$	(18,102	)	$	806,799
Stock issued for stock incentive plans, net		550			55			2,632			—			—			2,687
Stock purchased and retired		(259	)		(26	)		(2,632	)		(3,016	)		—			(5,674	)
Net income		—			—			—			3,634			—			3,634
Pension adjustment, net of taxes		—			—			—			—			135			135
Foreign currency translation		—			—			—			—			42			42
Unrealized loss on securities, net of taxes		—			—			—			—			(15	)		(15	)
Balance, March 31, 2017		217,780		$	21,778		$	—		$	803,770		$	(17,940	)	$	807,608

The accompanying notes are an integral part of these consolidated financial statements.

6 

RPC, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2017 AND 2016

(In thousands)

(Unaudited)

	Three months ended March 31,
	2017			2016
OPERATING ACTIVITIES
Net income (loss)	$	3,634		$	(32,511	)
Adjustments to reconcile net income (loss) to net cash (used for) provided by operating activities:
Depreciation, amortization and other non-cash charges		45,412			61,418
Stock-based compensation expense		2,687			2,660
Gain on disposition of assets, net		(1,517	)		(1,256	)
Deferred income tax benefit		(11,667	)		(8,423	)
Excess tax benefits for share-based payments		—			(403	)
(Increase) decrease in assets:
Accounts receivable		(77,406	)		56,887
Income taxes receivable		8,713			10,501
Inventories		(3,595	)		3,674
Prepaid expenses		(179	)		1,581
Other current assets		(429	)		241
Other non-current assets		(749	)		117
Increase (decrease) in liabilities:
Accounts payable		19,775			(29,410	)
Income taxes payable		(1,124	)		1,065
Accrued payroll and related expenses		5,399			(595	)
Accrued insurance expenses		582			668
Accrued state, local and other taxes		1,652			1,140
Other accrued expenses		(4,938	)		2,069
Pension liabilities		986			(732	)
Long-term accrued insurance expenses		345			(1,099	)
Other long-term liabilities		(30	)		(14,120	)
Net cash (used for) provided by operating activities		(12,449	)		53,472
INVESTING ACTIVITIES
Capital expenditures		(11,707	)		(9,581	)
Proceeds from sale of assets		2,493			2,010
Net cash used for investing activities		(9,214	)		(7,571	)
FINANCING ACTIVITIES
Excess tax benefits for share-based payments		—			403
Cash paid for common stock purchased and retired		(5,674	)		(3,191	)
Net cash used for financing activities		(5,674	)		(2,788	)
Net (decrease) increase in cash and cash equivalents		(27,337	)		43,113
Cash and cash equivalents at beginning of period		131,835			65,196
Cash and cash equivalents at end of period	$	104,498		$	108,309
Supplemental cash flows disclosure:
Interest paid, net of amounts capitalized	$	—		$	282
Income taxes paid (received), net	$	2,199		$	(32,487	)
Supplemental disclosure of noncash investing activities:
Capital expenditures included in accounts payable	$	5,322		$	1,862

The accompanying notes are an integral part of these consolidated financial statements.

7 

RPC, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. GENERAL

The accompanying unaudited consolidated financial statements include the accounts of RPC, Inc. and its wholly-owned subsidiaries (“RPC” or the “Company”) and have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. These consolidated financial statements have been prepared in accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 810, “Consolidation” and Rule 3A-02(a) of Regulation S-X. In accordance with ASC Topic 810 and Rule 3A-02 (a) of Regulation S-X, the Company’s policy is to consolidate all subsidiaries and investees where it has voting control.

In the opinion of management, all adjustments (all of which consisted of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017.

The balance sheet at December 31, 2016 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2016.

A group that includes the Company’s Chairman of the Board, R. Randall Rollins, and his brother Gary W. Rollins, who is also a director of the Company, and certain companies under their control, controls in excess of fifty percent of the Company’s voting power.

2. REVENUES

RPC’s revenues are generated principally from providing services and the related equipment. Revenues are recognized when the services are rendered and collectability is reasonably assured. Revenues from services and equipment are based on fixed or determinable priced purchase orders or contracts with the customer and do not include the right of return. Rates for services and equipment are priced on a per day, per unit of measure, per man hour or similar basis. Sales tax charged to customers is presented on a net basis within the consolidated statement of operations and excluded from revenues.

3. RECENT ACCOUNTING PRONOUNCEMENTS

The Financial Accounting Standards Board (FASB) issued the following applicable Accounting Standards Updates (ASU):

Recently Adopted Accounting Pronouncements:

Accounting Standards Update (ASU) No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. Current requirements are to measure inventory at the lower of cost or market. Market could be replacement cost, net realizable value, or net realizable value less an approximated normal profit margin. These amendments allow inventory to be measured at lower of cost or net realizable value and eliminates the market requirement. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. The adoption of these provisions did not have a material impact on the Company’s consolidated financial statements.

ASU No. 2016-07, Investments — Equity Method and Joint Ventures (Topic 323) Simplifying the Transition to the Equity Method of Accounting. The amendments eliminate the requirement to adjust the investment, results of operations, and retained earnings retroactively when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence. The cost of acquiring the additional interest in the investee is to be added to the current basis of the investor’s previously held interest and the equity method is to be adopted as of the date the investment qualifies. In addition, an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting is required to recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. The adoption of these provisions did not have a material impact on the Company’s consolidated financial statements.

8 

RPC, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ASU No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments simplify several aspects of the accounting for share-based payment award transactions, requiring excess tax benefits and deficiencies to be recognized as a component of income tax expense rather than equity. This guidance also requires excess tax benefits and deficiencies to be presented as an operating activity on the statement of cash flows and allows an entity to make an accounting policy election either to estimate expected forfeitures or to account for them as they occur. The Company will continue to estimate expected forfeitures. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. See Notes 5 and 10 on Stock Based Compensation and Income Taxes, respectively, for the effect of adoption on the financial statements.

ASU No. 2016-17, Consolidation (Topic 810): Interests Held through Related Parties That are under Common Control. The amendments affect reporting entities that are required to evaluate whether they should consolidate a variable interest entity in certain situations involving entities under common control. Specifically, the amendments change the evaluation of whether a reporting entity is the primary beneficiary of a variable interest entity by changing how a reporting entity that is a single decision maker of a variable interest entity treats indirect interests in the entity held through related parties that are under common control with the reporting entity. The Company adopted these provisions in the first quarter of 2017 and the adoption did not have a material impact on its consolidated financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted:

To be adopted in 2018:

REVENUE RECOGNITION:

The Financial Accounting Standards Board and International Accounting Standards Board issued their converged standard on revenue recognition in May 2014. The standard provides a comprehensive, industry-neutral revenue recognition model intended to increase financial statement comparability across companies and industries and significantly reduce the complexity inherent in today’s revenue recognition guidance. The various ASUs related to Revenue from Contracts with Customers (Topic 606) have been listed below: 

● ASU No. 2014-09. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services using a five step process.

● ASU No. 2015-14 deferred the effective date of ASU 2014-09 for all entities by one year to the first quarter of 2018 with early application permitted.

● ASU No. 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net). The amendments provide guidance on whether an entity is a principal or agent when providing services to a customer along with another party.

● ASU No. 2016-10, Identifying Performance Obligations and Licensing. The amendments clarify the earlier guidance on identifying performance obligations and licensing implementation.

● ASU No. 2016-11, Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting. This ASU rescinds certain SEC guidance related to issues that are currently codified under various topics.

● ASU No. 2016-12, Narrow - Scope Improvements and Practical Expedients. The amendments provide clarifying guidance on certain aspects of the five step process and practical expedients regarding the effect of modifications and status of completed contracts under legacy GAAP and disclosures related to the application of this guidance using the modified retrospective or retrospective transition method.

● ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers. The amendments in ASU 2016-20 affect narrow aspects of the guidance issued in ASU 2014-09 and includes among others, loan guarantees, impairment testing of contract costs, performance obligations disclosures and accrual of advertising costs.

9 

RPC, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Current status of implementation:

The Company is currently analyzing the effect of the standard across all of its revenue streams to evaluate the impact of the new standard on revenue contracts. This includes reviewing current accounting policies and practices to identify potential differences that would result from applying the requirements under the new standard. Most of the Company’s services are primarily short-term in nature, and the assessment at this stage is that the Company does not expect the adoption of the new revenue recognition standard to have a material impact on its financial statements. The Company plans to adopt the standard in the first quarter of 2018 using the modified retrospective method by recognizing the cumulative effect of initially applying the new standard as an adjustment to the opening balance of retained earnings.

ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The amendments make targeted improvements to existing U.S. GAAP and affects accounting for equity investments and financial instruments and liabilities and related disclosures. The amendments are effective starting in the first quarter of 2018, with early adoption permitted for certain provisions. The Company is currently evaluating the impact of these provisions on its consolidated financial statements.

ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The amendments provide guidance in the presentation and classification of certain cash receipts and cash payments in the statement of cash flows including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, and distributions received from equity method investees. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. The amendments require an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments eliminate the exception for an intra-entity transfer of an asset other than inventory. Two common examples of assets included in the scope of the amendments are intellectual property and property, plant, and equipment. The amendments do not include new disclosure requirements; however, existing disclosure requirements might be applicable when accounting for the current and deferred income taxes for an intra-entity transfer of an asset other than inventory. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments are required to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-18, Statement of Cash Flows (230): Restricted Cash. The amendments require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. As a result, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments do not provide a definition of restricted cash or restricted cash equivalents. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments should be applied using a retrospective transition method to each period presented. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business: The amendments are intended to help companies and other organizations evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The amendments provide a more robust framework to use in determining when a set of assets and activities is a business. They also provide more consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable. The amendments are effective beginning in the first quarter of 2018 with early application permitted under certain circumstances. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

10 

RPC, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ASU No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. To simplify the subsequent measurement of goodwill, the amendments eliminate Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments are effective for annual or any interim goodwill impairment tests beginning in 2020 applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

To be adopted in 2019 and later:

ASU No. 2016-02, Leases (Topic 842). Under the new guidance, lessees will need to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease), at the commencement of the lease term. The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. The amendments in this standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Lessees and lessors may not apply a full retrospective transition approach. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The amendments require the credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration should presented as an allowance rather than a write-down. It also allows recording of credit loss reversals in current period net income. The amendments are effective starting in the first quarter of 2020 with early application permitted a year earlier. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

11 

RPC, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

4. EARNINGS (LOSS) PER SHARE

Basic and diluted earnings (loss) per share are computed by dividing net income (loss) by the weighted average number of shares outstanding during the respective periods. In addition, the Company has periodically issued share-based payment awards that contain non-forfeitable rights to dividends and are therefore considered participating securities. Restricted shares of common stock (participating securities) outstanding and a reconciliation of weighted average shares outstanding is as follows:

	Three months ended  March 31,
(In thousands)	2017			2016
Net income (loss) available for stockholders:	$	3,634		$	(32,511	)
Less:  Adjustments for earnings attributable to participating securities		(51	)		-
Net income (loss) used in calculating losses per share	$	3,583		$	(32,511	)
Weighted average shares outstanding (including participating securities)		217,713			217,433
Adjustment for participating securities		(3,042	)		(3,322	)
Shares used in calculating basic and diluted earnings (loss) per share		214,671			214,111

5. STOCK-BASED COMPENSATION

In April 2014, the Company reserved 8,000,000 shares of common stock under the 2014 Stock Incentive Plan with a term of 10 years expiring in April 2024.  This plan provides for the issuance of various forms of stock incentives, including, among others, incentive and non-qualified stock options and restricted shares.  As of March 31, 2017, there were 5,696,000 shares available for grant.

Stock-based employee compensation expense was as follows for the periods indicated:

	Three months ended
	March 31,
(in thousands)	2017		2016
Pre-tax expense	$	2,687	$	2,660
After tax expense	$	1,706	$	1,689

 Restricted Stock

The following is a summary of the changes in non-vested restricted shares for the three months ended March 31, 2017:

	Shares			Weighted Average Grant-Date Fair Value
Non-vested shares at December 31, 2016		3,217,075		$	12.91
Granted		563,065			21.66
Vested		(800,225	)		13.22
Forfeited		(13,500	)		13.50
Non-vested shares at March 31, 2017		2,966,415		$	14.49

The total fair value of shares vested was approximately $17,527,000 during the three months ended March 31, 2017 and $9,527,000 during the three months ended March 31, 2016. Excess tax benefits realized from tax compensation deductions in excess of compensation expense have been reflected as follows:

● $2,536,000 for the three months ended March 31, 2017 has been recorded as a discrete tax adjustment and classified within operating activities in the consolidated statements of cash flows; and

● $403,000 for the three months ended March 31, 2016 were credited to capital in excess of par value and classified within financing activities as an inflow in addition to being disclosed as an outflow within operating activities in the consolidated statements of cash flows. 

12 

RPC, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The change in classification for the first quarter of 2017 was in accordance with the amendments of ASU 2016-09.

As of March 31, 2017, total unrecognized compensation cost related to non-vested restricted shares was $48,182,000, which is expected to be recognized over a weighted-average period of 4.0 years.

6. BUSINESS SEGMENT INFORMATION

RPC’s reportable segments are the same as its operating segments. RPC manages its business as either services offered on the well site with equipment and personnel (Technical Services) or services and equipment offered off the well site (Support Services). The businesses under Technical Services generate revenue based on equipment, personnel operating the equipment and the materials utilized to provide the service. They are all managed, analyzed and reported based on the similarities of the operational characteristics and costs associated with providing the service. The businesses under Support Services are primarily able to generate revenue through one source, which is either a hard asset or a personnel resource. Selected overhead including certain centralized support services and regulatory compliance are classified under Corporate.

Technical Services include RPC’s oil and gas services that utilize people and equipment to perform value-added completion, production and maintenance services directly to a customer’s well. The demand for these services is generally influenced by customers’ decisions to invest capital toward initiating production in a new oil or natural gas well, improving production flows in an existing formation, or to address well control issues. This operating segment consists primarily of pressure pumping, downhole tools, coiled tubing, snubbing, nitrogen, well control, wireline and fishing. The services offered under Technical Services are high capital and personnel intensive businesses. The common drivers of operational and financial success of these services include diligent equipment maintenance, strong logistical processes, and appropriately trained personnel who function well in a team environment. The Company considers all of these service to be closely integrated oil and gas well servicing businesses, and makes resource allocation and performance assessment decisions based on this operating segment as a whole across these various services. The principal markets for this segment include the United States, including the Gulf of Mexico, the mid-continent, southwest, Rocky Mountain and Appalachian regions, and international locations including primarily Argentina, Canada, Gabon, China, Colombia and the Middle East. Customers include major multi-national and independent oil and gas producers, and selected nationally-owned oil companies.

Support Services include all of the services that provide (i) equipment for customers’ use on the well site without RPC personnel and (ii) services that are provided in support of customer operations off the well site such as classroom and computer training, and other consulting services. The primary drivers of operational success for equipment provided for customers’ use on the well site without RPC personnel are offering safe, high quality and in-demand equipment appropriate for the well design characteristics. The drivers of operational success for the other Support Services relate to meeting customer needs off the well site and competitive marketing of such services. The equipment and services offered include drill pipe and related tools, pipe handling, pipe inspection and storage services, and oilfield training and consulting services. The demand for these services tends to be influenced primarily by customer drilling-related activity levels. The equipment and services offered include drill pipe and related tools, pipe handling, inspection and storage services, and oilfield training services. The principal markets for this segment include the United States, including the Gulf of Mexico, the mid-continent and Appalachian regions, and selected international locations. Customers include domestic operations of major multi-national and independent oil and gas producers, and selected nationally-owned oil companies.

The Company’s Chief Operating Decision Maker (“CODM”) assesses performance and makes resource allocation decisions regarding, among others, staffing, growth and maintenance capital expenditures and key initiatives based on operating segments outlined above.

RPC evaluates the performance of its segments based on revenues, operating profits and return on invested capital. Gains or losses on disposition of assets are reviewed by the CODM on a consolidated basis, and accordingly the Company does not report gains or losses at the segment level. Inter-segment revenues are generally recorded in segment operating results at prices that management believes approximate prices for arm’s length transactions and are not material to operating results.

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RPC, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Summarized financial information with respect RPC’s reportable segments for the three months ended March 31, 2017 and 2016 are shown in the following table:

	Three months ended   March 31,
(in thousands)	2017			2016
Revenues:
Technical Services	$	286,198		$	175,472
Support Services		11,921			13,623
Total revenues	$	298,119		$	189,095
Operating income (loss):
Technical Services	$	9,205		$	(63,264	)
Support Services		(5,221	)		(6,636	)
Corporate		(3,927	)		(6,443	)
Gain on disposition of assets, net		1,517			1,256
Total operating income (loss)	$	1,574		$	(75,087	)
Interest expense		(103	)		(325	)
Interest income		129			23
Other income, net		212			342
Income (loss) before income taxes	$	1,812		$	(75,047	)

As of and for the three months ended March 31, 2017	Technical Services		Support Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	39,494	$	5,052	$	117	$	44,663
Capital expenditures		9,766		1,909		32		11,707
Identifiable assets	$	782,778	$	74,631	$	191,645	$	1,049,054

As of and three months ended March 31, 2016	Technical Services		Support Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	53,618	$	6,899	$	119	$	60,636
Capital expenditures		8,032		858		691		9,581
Identifiable assets	$	875,622	$	94,667	$	184,907	$	1,155,196

7. INVENTORIES

Inventories of $111,945,000 at March 31, 2017 and $108,316,000 at December 31, 2016 consist of raw materials, parts and supplies.

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RPC, INC. AND SUBSIDIARIES

 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

8. EMPLOYEE BENEFIT PLAN

The following represents the net periodic benefit cost and related components of the Company’s multiple employers Retirement Income Plan:

	Three months ended March 31
(in thousands)	2017			2016
Interest cost	$	483		$	502
Expected return on plan assets		(589	)		(534	)
Amortization of net losses		213			200
Net periodic benefit cost	$	107		$	168

The Company did not contribute to this plan during the three months ended March 31, 2017 and contributed $900,000 during the three months ended March 31, 2016.

The Company permits selected highly compensated employees to defer a portion of their compensation into the non-qualified Supplemental Retirement Plan (“SERP”). The SERP assets are marked to market and totaled $19,313,000 as of March 31, 2017 and $18,367,000 as of December 31, 2016. The SERP assets are reported in non-current other assets on the consolidated balance sheets and changes in the fair value of these assets are reported in the consolidated statements of operations as compensation cost in selling, general and administrative expenses. Trading gains (losses) related to the SERP assets were approximately as follows:

	Three months ended  March 31
(in thousands)	2017		2016
Trading gains (losses), net	$	616	$	(327	)

The SERP liability includes participant deferrals net of distributions and is recorded on the consolidated balance sheets in long-term pension liabilities with any change in the fair value of the liabilities recorded as compensation cost within selling, general and administrative expenses in the consolidated statements of operations.

9. NOTES PAYABLE TO BANKS

The Company has a revolving credit facility with Banc of America Securities, LLC, SunTrust Robinson Humphrey, Inc., and Regions Capital Markets as Joint Lead Arrangers and Joint Book Managers, and a syndicate of four other lenders. The facility has a general term of five years ending January 17, 2019 and provides for a line of credit of up to $125 million, including a $50 million letter of credit subfacility, and a $35 million swingline subfacility. The revolving credit facility contains customary terms and conditions, including restrictions on indebtedness, dividend payments, business combinations and other related items. The revolving credit facility includes a full and unconditional guarantee by the Company’s 100 percent owned domestic subsidiaries whose assets equal substantially all of the consolidated assets of the Company and its subsidiaries. Certain of the Company’s minor subsidiaries are not guarantors.

On June 30, 2016, the Company amended the revolving credit facility to (1) establish a borrowing base to be the lesser of (a) $125 million or (b) the difference between (i) a specified percentage (ranging from 70% to 80%) of eligible accounts receivable less (ii) the amount of any outstanding letters of credit, (2) secure payment obligations under the credit facility with a security interest in the consolidated accounts receivable, and (3) replace the financial covenants related to minimum leverage and debt service coverage ratios with a covenant to maintain a minimum tangible net worth of not less than $700 million. As of March 31, 2017, the Company was in compliance with this covenant.

Revolving loans under the amended revolving credit facility bear interest at one of the following two rates at the Company’s election:

● the Base Rate, which is a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 0.50%, (b) Bank of America’s publicly announced “prime rate,” and (c) the Eurodollar Rate plus 1.00%; in each case plus a margin that ranges from 0.125% to 1.125% based on a quarterly consolidated leverage ratio calculation; or

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RPC, INC. AND SUBSIDIARIES

 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

● the Eurodollar Rate, which is the rate per annum equal to the London Interbank Offering Rate (“LIBOR”); plus, a margin ranging from 1.125% to 2.125%, based upon a quarterly debt covenant calculation.

In addition, the Company pays an annual fee ranging from 0.225% to 0.325%, based on a quarterly consolidated leverage ratio calculation, on the unused portion of the credit facility.

The Company has incurred loan origination fees and other debt related costs associated with the revolving credit facility in the aggregate of approximately $3.0 million. These costs, net of amounts written off as a result of a reduction in the size of the revolving credit facility in 2015, are being amortized to interest expense over the remaining term of the five-year loan, and the remaining net balance of $0.2 million at March 31, 2017 is classified as part of non-current other assets.

On January 4, 2016, the Company entered into a separate one year $35 million uncommitted letter of credit facility with Bank of America, N.A. Under the terms of the letter of credit facility, the Company paid 0.75% per annum on outstanding letters of credit. This letter of credit facility expired on January 3, 2017. All letters of credit are currently issued under RPC’s $125 million credit facility. Letters of credit outstanding totaled $19.1 million as of December 31, 2017 and 2016.

As of March 31, 2017, RPC had no outstanding borrowings under the revolving credit facility. Interest incurred, which includes facility fees on the unused portion of the revolving credit facility and the amortization of loan costs, was as follows:

	Three months ended  March 31
	2017		2016
(in thousands)
Interest incurred	$	103	$	109

10. INCOME TAXES

The Company determines its periodic income tax benefit or expense based upon the current period income and the annual estimated tax rate for the Company adjusted for any change to prior period estimates. The estimated tax rate is revised, if necessary, as of the end of each successive interim period during the fiscal year to the Company’s current annual estimated tax rate.

For the three months ended March 31, 2017, the effective rate reflects an income tax benefit of 100.6 percent compared to an income tax benefit of 56.7 percent for the comparable period in the prior year. The Company adopted the provisions of ASU 2016-09 in the first quarter of 2017 that requires excess tax benefits and deficiencies to be recognized as a component of income tax expense rather than stockholders’ equity. This resulted in a beneficial discrete adjustment of $2.5 million to the provision for income taxes in the first quarter of 2017. The 2016 beneficial rate was the result of operational losses and the one-time beneficial impact of a resolution of a tax matter with a state taxing authority, offset by the detrimental effect of non-deductible permanent items.

11. FAIR VALUE DISCLOSURES

The various inputs used to measure assets at fair value establish a hierarchy that distinguishes between assumptions based on market data (observable inputs) and the Company’s assumptions (unobservable inputs). The hierarchy consists of three broad levels as follows:

1. Level 1 – Quoted market prices in active markets for identical assets or liabilities.

2. Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

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RPC, INC. AND SUBSIDIARIES

 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

3. Level 3 – Unobservable inputs developed using the Company’s estimates and assumptions, which reflect those that market participants would use.

The following table summarizes the valuation of financial instruments measured at fair value on a recurring basis in the balance sheets as of March 31, 2017 and December 31, 2016:

			Fair Value Measurements at March 31, 2017 with:
(in thousands)	Total		Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
			(Level 1)		(Level 2)		(Level 3)
Assets:
Available-for-sale securities – equity securities	$	240	$	240	$	—	$	—
Investments measured at net asset value - trading securities	$	19,313

			Fair Value Measurements at December 31, 2016 with:
(in thousands)	Total		Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
			(Level 1)		(Level 2)		(Level 3)
Assets:
Available-for-sale securities – equity securities	$	264	$	264	$	—	$	—
Investments measured at net asset value - trading securities	$	18,367

The Company determines the fair value of marketable securities classified as available-for-sale through quoted market prices. The total fair value is the final closing price, as defined by the exchange in which the asset is actively traded, on the last trading day of the period, multiplied by the number of units held without consideration of transaction costs. Marketable securities classified as trading are comprised of the SERP assets, as described in Note 8, and are recorded primarily at their net cash surrender values, calculated using their net asset values, which approximates fair value, as provided by the issuing insurance company. Significant observable inputs, in addition to quoted market prices, were used to value the trading securities. The Company’s policy is to recognize transfers between levels at the beginning of quarterly reporting periods. For the period ended March 31, 2017, there were no significant transfers in or out of levels 1, 2 or 3.

Under the Company’s revolving credit facility, there was no balance outstanding at March 31, 2017 and December 31, 2016. Outstanding balances based on the quote from the lender (level 2 inputs) is similar to the fair value at the same date. The borrowings under our revolving credit facility bear variable interest rates as described in Note 9. The Company is subject to interest rate risk on the variable component of the interest rate.

The carrying amounts of other financial instruments reported in the balance sheet for current assets and current liabilities approximate their fair values because of the short maturity of these instruments. The Company currently does not use the fair value option to measure any of its existing financial instruments and has not determined whether it will elect this option for financial instruments acquired in the future.

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RPC, INC. AND SUBSIDIARIES

 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

12. ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

Accumulated other comprehensive (loss) income consists of the following (in thousands):

	Pension   Adjustment			Unrealized   Gain (Loss) On Securities			Foreign Currency Translation			Total
Balance at December 31, 2016	$	(15,503	)	$	39		$	(2,638	)	$	(18,102	)
Change during the period:
Before-tax amount		-			(24	)		42			18
Tax benefit		-			9			-			9
Reclassification adjustment, net of taxes:
Amortization of net loss (1)		135			-			-			135
Total activity for the period		135			(15	)		42			162
Balance at March 31, 2017	$	(15,368	)	$	24		$	(2,596	)	$	(17,940	)

(1) Reported as part of selling, general and administrative expenses.

	Pension   Adjustment			Unrealized   Gain (Loss) On Securities			Foreign Currency Translation			Total
Balance at December 31, 2015	$	(14,715	)	$	36		$	(3,290	)	$	(17,969	)
Change during the period:
Before-tax amount		-			(14	)		692			678
Tax benefit		-			5			-			5
Reclassification adjustment, net of taxes:
Amortization of net loss (1)		127			-			-			127
Total activity for the period		127			(9	)		692			810
Balance at March 31, 2016	$	(14,588	)	$	27		$	(2,598	)	$	(17,159	)

(1) Reported as part of selling, general and administrative expenses.

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RPC, INC. AND SUBSIDIARIES

ITEM. 2 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

The following discussion should be read in conjunction with the Consolidated Financial Statements included elsewhere in this document. See also “Forward-Looking Statements” on page 25.

RPC, Inc. (“RPC”) provides a broad range of specialized oilfield services primarily to independent and major oilfield companies engaged in exploration, production and development of oil and gas properties throughout the United States, including the Gulf of Mexico, mid-continent, southwest, Rocky Mountain and Appalachian regions, and in selected international locations. The Company’s revenues and profits are generated by providing equipment and services to customers who operate oil and gas properties and invest capital to drill new wells and enhance production or perform maintenance on existing wells. We continuously monitor factors that impact current and expected customer activity levels, such as the price of oil and natural gas, changes in pricing for our services and equipment, and utilization of our equipment and personnel. Our financial results are affected by geopolitical factors such as political instability in the petroleum-producing regions of the world, the actions of the OPEC oil cartel, overall economic conditions and weather in the United States, the prices of oil and natural gas, and our customers’ drilling and production activities.

The discussion of our key business and financial strategies set forth under the Overview section in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2016 is incorporated herein by reference.  In 2017, the Company’s strategy of utilizing equipment in unconventional basins has continued.  During the three months ended March 31, 2017, we made capital expenditures totaling $11.7 million primarily for the maintenance of our existing revenue-producing equipment.

During the first quarter of 2017, revenues increased 57.7 percent to $298.1 million compared to the same period in the prior year. The increase in revenues is due to higher activity levels, improved pricing and increasing service intensity in our Technical Services segment and more specifically our pressure pumping and downhole tools services. International revenues for the first quarter of 2017 decreased 16.2 percent to $13.7 million compared to the same period in the prior year. We continue to pursue international growth opportunities, but the nature of this work is unpredictable and we believe that international revenues will continue to represent a low percentage of RPC’s consolidated revenues in the future.

Cost of revenues increased during the first quarter of 2017 in comparison to the same period of the prior year due primarily to higher materials and supplies expenses and maintenance and repair expenses, which increased due to higher activity levels and greater service intensity. As a percentage of revenues, cost of revenues decreased due to improved pricing for our services and efficiencies resulting from higher activity levels primarily within Technical Services.

Selling, general and administrative expenses were $37.2 million in the first quarter of 2017 compared to $43.5 million in the first quarter of 2016. The decrease in these expenses was due to lower bad debt expense and employment costs. As a percentage of revenues, these costs decreased to 12.5 percent in the first quarter of 2017 compared to 23.0 percent in the first quarter of 2016 due to lower expenses and improved leverage of higher revenues over fixed costs.

Income before income taxes was $1.8 million for the three months ended March 31, 2017 compared to a loss of $75.0 million in the same period of 2016. Earnings per share were $0.02 for the three months ended March 31, 2017 compared to losses per share of $0.15 in the same period of 2016. Cash (used for) provided by operating activities was $(12.4) million for the three months ended March 31, 2017 compared to $53.5 million in the same period of 2016 due primarily to an unfavorable change in working capital partially offset by higher earnings.

We expect capital expenditures during full year 2017 will be approximately $75 million, and will be directed primarily towards the capitalized maintenance of our existing fleet of revenue-producing equipment.

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RPC, INC. AND SUBSIDIARIES

Outlook

Drilling activity in the U.S. domestic oilfields, as measured by the rotary drilling rig count, reached a recent cyclical peak of 1,931 during the third quarter of 2014. Between the third quarter of 2014 and the second quarter of 2016, the drilling rig count fell by approximately 79 percent. During the second quarter of 2016, the U.S. domestic drilling rig count reached the lowest level ever recorded. The principal catalyst for this steep rig count decline was the decrease in the price of oil in the world markets, which began in the second quarter of 2014. The price of oil began to fall at that time due to the perceived oversupply of oil, weak global demand growth, and the strength of the U.S. dollar on world currency markets. During the second quarter of 2016, the price of oil and the U.S. domestic rig count began to increase, and increased steadily throughout the remainder of 2016 and into the beginning of the second quarter of 2017. As of the beginning of the second quarter of 2017, RPC believes that U.S. oilfield activity will continue to increase during the near term, although our long-term visibility remains limited.

The current and projected prices of oil, natural gas and natural gas liquids are important catalysts for U.S. domestic drilling activity. During the first two quarters of 2016, the prices of oil and natural gas remained at low levels that discouraged our customers from undertaking most of their potential exploration and production activities. The prices of oil and natural gas increased during the third and fourth quarters of 2016 and into the first and second quarters of 2017, although the rate of increase in the prices of these commodities slowed during the first quarter of 2017. We believe that the price of oil has risen to a level that provides adequate financial returns to our customers and encourages increased drilling and production activities in many domestic oil-producing basins. However, the price of natural gas has not risen to a level that encourages our customers to increase their drilling and production activities, and we remain discouraged that U.S. production of natural gas remains high in spite of historically low drilling activities. The average price of natural gas liquids during 2016 increased by approximately six percent compared to 2015, and in the first quarter of 2017, the price of natural gas liquids increased by 21 percent compared to the fourth quarter of 2016. These commodity price trends, if they continue, have moderately positive implications for our near-term activity levels. As evidence of the impact of recovering commodity prices on our customers’ activity levels, both the oil-directed and natural gas-directed drilling rig counts at the beginning of the second quarter of 2017 had increased by more than 100 percent compared to the lowest comparable rig counts recorded in 2016.

The majority of the U.S. domestic rig count remains directed towards oil. At the beginning of the second quarter of 2017, approximately 80 percent of the U.S. domestic rig count was directed towards oil, consistent with the prior year. We believe that oil-directed drilling will remain the majority of domestic drilling, and that natural gas-directed drilling will remain a low percentage of U.S. domestic drilling in the near term. We believe that this relationship will continue due to relatively low prices for natural gas, high production from existing natural gas wells, and industry projections of limited increases in domestic natural gas demand during the near term.

We continue to monitor the market for our services and the competitive environment in 2017. While the U.S. domestic rig count has increased sharply since the historical low recorded during the second quarter of 2016, we believe that the rate of increase will moderate during the near term. However, we believe that in spite of the large percentage increases in oilfield activity during the past several quarters, the pricing for our services has not yet reached a level that provides financial returns that will allow the industry to maintain its fleet of revenue-producing equipment or hire additional personnel to operate idle equipment. Furthermore, our customers during the first quarter of 2017 have thus far been very reluctant to accept increases in pricing for our services in order to compensate us for increased costs and to allow us to generate higher financial returns. For this reason, we believe that continued near-term expansion in U.S. domestic oilfield activities will be moderate until commodity prices increase significantly. Over the long term, we believe that the steep decline in oil-directed drilling in the U.S. domestic market will reduce U.S. domestic oil production and serve as a catalyst for oil prices to increase. This belief is due to the fact that oil-directed wells drilled in shale resource plays typically exhibit high initial production soon after being completed followed by a decline in production in later years. We note that U.S. domestic oil production has declined by less than 10 percent since its most recent peak in the first quarter of 2015. We are encouraged by the fact that drilling and completion activities continue to be highly service-intensive and require a large amount of equipment and raw materials. Furthermore, we note that some wells in the U.S. domestic market have been drilled but not completed. We believe that many of our customers have started to complete these wells, and that they provide potential revenue for RPC’s completion-directed services during the near term. Finally, we are encouraged by our belief that many of our competitors have not maintained their equipment to a level that allows them to provide reliable, consistent services to their customers. During 2015 and the first three quarters of 2016, we responded to the significant declines in industry activity levels and pricing for our services by reducing costs and employee headcount and closed selected operational locations. During the fourth quarter of 2016 and the first quarter of 2017, however, we have started recruiting and hiring operational personnel to respond to increased industry activity levels.

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RPC, INC. AND SUBSIDIARIES

We note in the current competitive environment that many of our smaller competitors have high levels of debt, higher cost structures, and less-developed logistical capabilities than RPC. During 2015 and through the first three quarters of 2016, a number of smaller competitors ceased operations and sold their businesses or liquidated their assets. During 2016, several of our peers filed for bankruptcy protection. While these developments place us in a more favorable competitive position, they are offset by the fact that the capital markets have recently provided capital to allow several of our competitors to emerge from bankruptcy and several other private equity-funded companies to complete initial public offerings of their common stock. We believe that our ongoing maintenance of idle equipment during the recent downturn is allowing RPC to return our idle revenue-producing equipment to service quickly and at minimal cost as market conditions improve. In this environment RPC also monitors the financial stability of our customers, due to the fact that many of them have also financed their operations with a large amount of debt, and this type of financing is less available than in previous years, although we also note that many of our customers have recently raised equity to stabilize their capital structures and expand their operations. RPC plans minimal increases in our fleet of revenue-producing equipment during 2017. Our consistent response to the industry’s potential uncertainty is to maintain sufficient liquidity and a conservative capital structure and monitor our discretionary spending. We intend to maintain a financial structure that includes little or no debt during the near term.

Results of Operations

	Three months ended March 31
	2017			2016
Consolidated revenues [in thousands]	$	298,119		$	189,095
Revenues by business segment [in thousands]:
Technical	$	286,198		$	175,472
Support		11,921			13,623
Consolidated operating income (loss) [in thousands]	$	1,574		$	(75,087	)
Operating income (loss) by business segment [in thousands]:
Technical	$	9,205		$	(63,264	)
Support		(5,221	)		(6,636	)
Corporate		(3,927	)		(6,443	)
Gain on disposition of assets, net		1,517			1,256
Percentage cost of revenues to revenues		72.5	%		85.3	%
Percentage selling, general & administrative expenses to revenues		12.5	%		23.0	%
Percentage depreciation and amortization expense to revenues		15.0	%		32.1	%
Average U.S. domestic rig count		744			543
Average natural gas price (per thousand cubic feet (mcf))	$	3.01		$	1.96
Average oil price (per barrel)	$	51.69		$	33.75

THREE MONTHS ENDED MARCH 31, 2017 COMPARED TO THREE MONTHS ENDED MARCH 31, 2016

Revenues. Revenues for the three months ended March 31, 2017 increased 57.7 percent compared to the three months ended March 31, 2016. Domestic revenues of $284.4 million increased 64.6 percent compared to the same period in the prior year. The increase in revenues resulted primarily from higher activity levels, improved pricing and increasing service intensity in our Technical Services segment and more specifically our pressure pumping and downhole tools services. International revenues of $13.7 million decreased 16.2 percent for the three months ended March 31, 2017 compared to the same period in the prior year. Our international revenues are impacted by the timing of project initiation and their ultimate duration and can be difficult to predict.

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RPC, INC. AND SUBSIDIARIES

The average price of natural gas was 54.4 percent higher and the average price of oil was 53.2 percent higher during the first quarter of 2017 as compared to the same period in the prior year. The average domestic rig count during the current quarter was 37.0 percent higher than the same period in 2016.

The Technical Services segment revenues for the first quarter of 2017 increased 63.1 percent compared to the same period in the prior year due to higher activity levels and improved pricing within our pressure pumping and downhole tools services. The Support Services segment revenues for the first quarter of 2017 decreased by 12.5 percent compared to the same period in the prior year. This decrease was due principally to lower activity levels within rental tools and pipe inspection services. Utilization of our rental tool fleet continues to be challenged by a low U.S. domestic rig count and continued intense competition. Technical Services reported operating profit of $9.2 million for the first quarter of 2017 compared to an operating loss of $63.3 million in the first quarter of the prior year due to higher activity levels, improved pricing, and lower bad debt expense. Support Services reported a slightly lower operating loss for the three months ended March 31, 2017 due to continued low levels of revenues, partially offset by successful cost control efforts. RPC corporate expenses declined during the first quarter of 2017 due to contingent professional fees of approximately $2.0 million recorded in the first quarter of 2016.

Cost of revenues.  Cost of revenues increased 34.1 percent to $216.2 million for the three months ended March 31, 2017 compared to $161.3 million for the three months ended March 31, 2016.  Cost of revenues increased primarily due to higher materials and supplies expenses and maintenance and repair expenses, which increased due to higher activity levels and greater service intensity. As a percentage of revenues, cost of revenues decreased due to improved pricing for our services and efficiencies resulting from higher activity levels primarily within Technical Services.

Selling, general and administrative expenses. Selling, general and administrative expenses were $37.2 million for the three months ended March 31, 2017 and $43.5 million for the three months ended March 31, 2016. These expenses decreased during the first quarter as compared to the prior year due to lower bad debt expense and employment costs. As a percentage of revenues, these costs decreased to 12.5 percent in the first quarter of 2017 compared to 23.0 percent in the first quarter of 2016, due to lower expenses and improved leverage of higher revenues over fixed costs.

Depreciation and amortization. Depreciation and amortization decreased 26.3 percent to $44.7 million for the three months ended March 31, 2017, compared to $60.6 million for the quarter ended March 31, 2016 due to lower capital expenditures.

Gain on disposition of assets, net.  Gain on disposition of assets, net was $1.5 million for the three months ended March 31, 2017 compared to $1.3 million for the three months ended March 31, 2016.  The gain on disposition of assets, net is comprised of gains and losses related to various property and equipment dispositions or sales to customers of lost or damaged rental equipment.

Other income, net. Other income, net was $212 thousand for the three months ended March 31, 2017 compared to $342 thousand for the same period in the prior year.

Interest expense. Interest expense of $103 thousand for the three months ended March 31, 2017 decreased compared to $325 thousand for the three months ended March 31, 2016. Interest expense declined during the quarter because RPC had no outstanding balances under its revolving credit facility during the quarter. Interest expense during the first quarter of 2017 principally consists of facility fees on the unused portion of the credit facility and the amortization of loan costs.

Income tax benefit. Income tax benefit was $1.8 million during the three months ended March 31, 2017 compared to $42.5 million for the same period in 2016. The effective beneficial tax rate was 100.6 percent for the three months ended March 31, 2017 compared to 56.7 percent for the three months ended March 31, 2016. The Company adopted the provisions of ASU 2016-09 in the first quarter of 2017 that requires excess tax benefits and deficiencies relating to shared-based payment awards to be recognized as a component of income tax expense rather than stockholders’ equity as in prior periods. This resulted in a beneficial discrete adjustment of $2.5 million to the provision for income taxes in the first quarter of 2017. The 2016 beneficial rate was the result of operational losses and the one-time beneficial impact of a resolution of a tax matter with a state taxing authority, offset by the detrimental effect of non-deductible permanent items.

 22

RPC, INC. AND SUBSIDIARIES

Liquidity and Capital Resources

Cash Flows

The Company’s cash and cash equivalents as of March 31, 2017 were $104.5 million. The following table sets forth the historical cash flows for the three months ended March 31, 2017 and 2016:

	Three months ended March 31,
(In thousands)	2017			2016
Net cash (used for) provided by operating activities	$	(12,449	)	$	53,472
Net cash used for investing activities		(9,214	)		(7,571	)
Net cash used for financing activities		(5,674	)		(2,788	)

Cash (used for) provided by operating activities for the three months ended March 31, 2017 decreased by $65.9 million compared to the same period in the prior year. This decrease is due primarily to net unfavorable changes in working capital of $99.4 million coupled with decreases in depreciation and amortization expenses of $16.0 million and deferred income tax benefits of $3.2 million, partially offset by increases in net income of $36.1 million and long-term liabilities of $14.1 million primarily related to income taxes.

The net unfavorable change in working capital is primarily due to unfavorable changes of $134.3 million in accounts receivable due to higher business activity levels, $7.3 million in inventories, $2.4 million in prepaid expenses and other current assets, $7.0 in accrued expenses and $4.0 million in income taxes payable/ receivable, net. This unfavorable change was partially offset by favorable changes of $49.2 million in accounts payable and $6.0 million in accrued payroll and related expenses consistent with higher business activity levels coupled with the timing of payments.

Cash used for investing activities for the three months ended March 31, 2017 increased by $1.6 million, compared to the three months ended March 31, 2016, primarily because of higher capital expenditures.

Cash used for financing activities for the three months ended March 31, 2017 increased by $2.9 million primarily as a result of repurchases for shares turned in for taxes related to the vesting of certain restricted shares.

Financial Condition and Liquidity

The Company’s financial condition as of March 31, 2017 remains strong.  We believe the liquidity provided by our existing cash and cash equivalents and our overall strong capitalization will provide sufficient liquidity to meet our requirements for at least the next twelve months. The Company currently has a $125 million revolving credit facility that matures in January 2019. The facility contains customary terms and conditions, including restrictions on indebtedness, dividend payments, business combinations and other related items. On June 30, 2016, the Company amended the revolving credit facility to (1) establish a borrowing base to be the lesser of $125 million or a specified percentage of eligible accounts receivable less the amount of any outstanding letters of credit. As of March 31, 2017, there were no outstanding borrowings. RPC had letters of credit outstanding relating to self-insurance programs and contract bids totaling $19.1 million as of March 31, 2017. For additional information with respect to RPC’s facility, see Note 9 of the Notes to Consolidated Financial Statements included in the report.

The Company’s decisions about the amount of cash to be used for investing and financing purposes are influenced by its capital position, including access to borrowings under our facility, and the expected amount of cash to be provided by operations. We believe our liquidity will continue to provide the opportunity to grow our asset base and revenues during periods with positive business conditions and strong customer activity levels. In addition, the Company’s decisions about the amount of cash to be used for investing and financing activities may also be influenced by the financial covenants in our credit facility but we do not expect the covenants to restrict our planned activities. The Company is in compliance with these financial covenants.

Cash Requirements

The Company currently expects that capital expenditures will be approximately $75 million during 2017, of which $11.7 million has been spent as of March 31, 2017. We expect capital expenditures for the remainder of 2017 to be primarily directed toward capitalized equipment maintenance. The remaining capital expenditures will be directed towards the purchase of revenue-producing equipment. The actual amount of 2017 capital expenditures will depend primarily on equipment maintenance requirements, expansion opportunities, and equipment delivery schedules.

 23

RPC, INC. AND SUBSIDIARIES

The Company has ongoing sales and use tax audits in various jurisdictions subject to varying interpretations of statutes. The Company has recorded the exposure from these audits to the extent issues are resolved or are reasonably estimable. There are issues that could result in unfavorable outcomes that cannot be currently estimated.

The Company’s Retirement Income Plan, a multiple employer trusteed defined benefit pension plan, provides monthly benefits upon retirement at age 65 to eligible employees. The Company does not expect to contribute to the plan during 2017.

As of March 31, 2017, the Company’s stock buyback program authorizes the repurchase of up to 31,578,125 shares. There were no shares repurchased on the open market during the three months ended March 31, 2017, and 2,050,154 shares remain available to be repurchased under the current authorization as of March 31, 2017. The Company may repurchase outstanding common shares periodically based on market conditions and our capital allocation strategies considering restrictions under our credit facility. The stock buyback program does not have a predetermined expiration date.

On July 28, 2016, the Board of Directors voted to temporarily suspend RPC’s regular quarterly cash dividend to common stockholders. Subject to industry conditions and RPC’s earnings, financial condition, and other relevant factors, the Company expects to resume regular quarterly cash dividends to common stockholders in the future.

INFLATION 

The Company purchases its equipment and materials from suppliers who provide competitive prices, and employs skilled workers from competitive labor markets. If inflation in the general economy increases, the Company’s costs for equipment, materials and labor could increase as well. In addition, increases in activity in the domestic oilfield can cause upward wage pressures in the labor markets from which it hires employees as well as increases in the costs of certain materials and key equipment components used to provide services to the Company’s customers. In previous periods of strong oilfield activity, we experienced high employment costs due to the demand for skilled labor in our markets as well as high costs for certain raw materials the Company uses to provide its services. During 2015 and 2016, however, supplies of raw materials became more readily available as domestic oilfield activity decreased. In addition, skilled labor became more available, and upward wage pressures subsided. During the third quarter of 2016, however, the Company began to experience upward pressure on the price of labor, due to increased oilfield activity and a shortage of skilled employees caused by the industry’s headcount reductions since the first quarter of 2015. In the first quarter of 2017, the Company has also started to experience increases in the prices of certain raw materials used in providing our services. The market for the Company’s services remains competitive, due to relatively low commodity prices, so it may be difficult for the Company to increase the prices charged to our customers to compensate for these cost increases. 

OFF BALANCE SHEET ARRANGEMENTS

The Company does not have any material off balance sheet arrangements.

RELATED PARTY TRANSACTIONS

Marine Products Corporation

Effective February 28, 2001, the Company spun-off the business conducted through Chaparral Boats, Inc., RPC’s former powerboat manufacturing segment. In conjunction with the spin-off, RPC and Marine Products Corporation entered into various agreements that define the companies’ relationship. During the three months ended March 31, 2017, RPC charged Marine Products Corporation for its allocable share of administrative costs incurred for services rendered on behalf of Marine Products Corporation totaling $195,000 for the three months ended March 31, 2017 compared to $202,000 for the comparable period in 2016.

Other

The Company periodically purchases in the ordinary course of business products or services from suppliers who are owned by officers or significant stockholders of, or affiliated with the directors of RPC. The total amounts paid to these affiliated parties were $467,000 for the three months ended March 31, 2017 and $401,000 for the three months ended March 31, 2016.

 24

RPC, INC. AND SUBSIDIARIES

RPC receives certain administrative services and rents office space from Rollins, Inc. (a company of which Mr. R. Randall Rollins is also Chairman, and which is controlled by Mr. Rollins and his affiliates). The service agreements between Rollins, Inc. and the Company provide for the provision of services on a cost reimbursement basis and are terminable on three months’ notice. The services covered by these agreements include office space, selected administration services for certain employee benefit programs, and other administrative services. Charges to the Company (or to corporations which are subsidiaries of the Company) for such services and rent aggregated $26,000 for the three months ended March 31, 2017 and $27,000 for the three months ended March 31, 2016.

CRITICAL ACCOUNTING POLICIES

The discussion of Critical Accounting Policies is incorporated herein by reference from the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2016. There have been no significant changes in the critical accounting policies since year-end.

IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS

See Note 3 of the Notes to Consolidated Financial Statements for a description of recent accounting pronouncements, including the expected dates of adoption and estimated effects on results of operations and financial condition.

SEASONALITY

Oil and natural gas prices affect demand throughout the oil and natural gas industry, including the demand for the Company’s products and services. The Company’s business depends in large part on the economic conditions of the oil and gas industry, and specifically on the capital expenditures of its customers related to the exploration and production of oil and natural gas. There is a positive correlation between these expenditures and customers’ demand for the Company’s services. As such, when these expenditures fluctuate, customers’ demand for the Company’s services fluctuates as well. These fluctuations depend on the current and projected prices of oil and natural gas and resulting drilling activity, and are not seasonal to any material degree.

FORWARD-LOOKING STATEMENTS

Certain statements made in this report that are not historical facts are “forward-looking statements” under Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may include, without limitation, statements regarding the effect of recent accounting pronouncements on the Company’s consolidated financial statements; our plans to continue to pursue international growth opportunities and our belief that international revenues will continue to represent a low percentage of our consolidated revenues in the future; our expectation for the amount and focus of our capital expenditures during 2017; the belief that U.S. oilfield activity will continue to increase in the near term; the belief that the price of oil has risen to a level that provides our customers financial returns that will encourage drilling and production activities; the belief that the price of natural gas has not risen to a level that encourages our customers to increase their drilling and production activities; the belief that current commodity price trends, if they continue, have moderately positive implications for near term activity levels; the belief that oil-directed drilling will remain the majority of domestic drilling, and that natural gas-directed drilling will remain a low percentage of U.S. domestic drilling in the near term; the belief that rate of increases in U.S. domestic rig count will moderate during the near term; the belief that the pricing for our services has not reached a level that will allow for the industry to maintain its fleet of revenue-producing equipment or hire additional personnel to operate idle equipment; the belief that the steep decline in oil-directed drilling in the U.S. domestic oil market will reduce U.S. domestic oil production and serve as a catalyst for oil prices to increase; the belief that many of our competitors are not maintaining their equipment to a level that allows them to provide reliable, consistent services to their customers; our plans to maintain our financial structure which includes little or no debt during the near term; our plan to maintain sufficient liquidity and a conservative capital structure and monitor our discretionary spending; our business strategy, plans and objectives; market risk exposure; adequacy of capital resources and funds; opportunity for growth and expansion; anticipated pension funding payments and capital expenditures; our expectation that we will resume cash dividends, subject to the earnings and financial condition of the Company and other relevant factors; the possible unfavorable outcome of sales and use tax audits; the impact of inflation and related trends on the Company’s financial position and operating results; our beliefs regarding oil field activity and the related impact on wages for skilled labor and the prices of raw material used in providing our services; our belief that changes in foreign exchange rates are not expected to have a material effect on our consolidated results of operations or financial condition; our belief that the outcome of litigation will not have a material adverse effect upon our financial position or results of operations; and our beliefs and expectations regarding future demand for our products and services, and other events and conditions that may influence the oilfield services market and our performance in the future. The Company does not undertake to update its forward-looking statements.

 25

RPC, INC. AND SUBSIDIARIES

The words “may,” “will,” “expect,” “believe,” “anticipate,” “project,” “estimate,” “focus,” “plan,” and similar expressions generally identify forward-looking statements. Such statements are based on certain assumptions and analyses made by our management in light of its experience and its perception of historical trends, current conditions, expected future developments and other factors it believes to be appropriate. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of RPC to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements. Risk factors that could cause such future events not to occur as expected include those described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, its other SEC filings and the following: the declines in the price of oil and natural gas, which tend to result in a decrease in drilling activity and therefore a decline in the demand for our services, the actions of the OPEC cartel, the ultimate impact of current and potential political unrest and armed conflict in the oil producing regions of the world, which could impact drilling activity, adverse weather conditions in oil or gas producing regions, including the Gulf of Mexico, competition in the oil and gas industry, the Company’s ability to implement price increases, the potential impact of possible future regulations on hydraulic fracturing on our business, risks of international operations, and reliance on large customers.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is subject to interest rate risk exposure through borrowings on its credit facility. As of March 31, 2017, there were no outstanding interest-bearing advances on our credit facility, which bears interest at a floating rate.

Additionally, the Company is exposed to market risk resulting from changes in foreign exchange rates. However, since the majority of the Company’s transactions occur in U.S. currency, this risk is not expected to have a material effect on its consolidated results of operations or financial condition.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures – The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms, and that such information is accumulated and communicated to its management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As of the end of the period covered by this report, March 31, 2017 (the “Evaluation Date”), the Company carried out an evaluation, under the supervision and with the participation of its management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures. Based upon this evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective at a reasonable assurance level as of the Evaluation Date.

Changes in internal control over financial reporting – Management’s evaluation of changes in internal control did not identify any changes in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

 26

RPC, INC. AND SUBSIDIARIES

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

RPC is involved in litigation from time to time in the ordinary course of its business. RPC does not believe that the outcome of such litigation will have a material adverse effect on the financial position or results of operations of RPC.

ITEM 1A. RISK FACTORS

See risk factors described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Shares repurchased by the Company and affiliated purchases in the first quarter of 2017 are outlined below.

Period			Total Number of  Shares  (or Units)  Purchased			Average Price Paid Per Share (or Unit)		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs  (1)
January 1, 2017 to January 31, 2017				259,028	(2)	$	21.91		-		2,050,154
February 1, 2017 to February 28, 2017				-			-		-		2,050,154
March 1, 2017 to March 31, 2017				-			-		-		2,050,154
Totals				259,028		$	21.91		-		2,050,154
	(1)	The Company has a stock buyback program initially adopted in 1998 and subsequently amended in 2013 that authorizes the repurchase of up to 31,578,125 shares. There were no shares repurchased as part of this program during the first quarter of 2017. As of March 31, 2017, there are 2,050,154 shares available to be repurchased under the current authorization. Currently the program does not have a predetermined expiration date.
	(2)	Represents shares repurchased by the Company in connection with taxes related to vesting of restricted shares.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

The information required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95.1 to this Form 10-Q.

ITEM 5. OTHER INFORMATION

On April 25, 2017, the Board of Directors of the Company amended the Company’s Amended and Restated By-laws solely to repeal the provisions addressing the payment of costs for specified stockholder actions, including a stockholder’s breach of the By-laws or specified intra-corporate proceedings in which such stockholder is not the prevailing party.

The foregoing summary of the amendment to the By-laws is qualified in its entirety by reference to the text of the By-laws, as amended and restated on and effective as of April 25, 2017, a copy of which is attached hereto as Exhibit 3.2 and is incorporated herein by reference.

27 

RPC, INC. AND SUBSIDIARIES

ITEM 6. EXHIBITS

Exhibit Number	Description
3.1(a)	Restated certificate of incorporation of RPC, Inc. (incorporated herein by reference to Exhibit 3.1 to the Annual Report on Form 10-K for the fiscal year ended December 31, 1999).
3.1(b)	Certificate of amendment of the certificate of incorporation of RPC, Inc. (incorporated by reference to Exhibit 3.1(b) to Registrant’s Quarterly Report on Form 10-Q filed on May 8, 2006).
3.1(c)	Certificate of amendment of the certificate of incorporation of RPC, Inc. (incorporated by reference to Exhibit 3.1(c) to the Registrant’s Quarterly Report on Form 10-Q filed on August 2, 2011).
3.2	Amended and Restated Bylaws of RPC, Inc.
4	Form of Stock Certificate (incorporated herein by reference to Exhibit 4 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 1998).
31.1	Section 302 certification for Chief Executive Officer.
31.2	Section 302 certification for Chief Financial Officer.
32.1	Section 906 certifications for Chief Executive Officer and Chief Financial Officer.
95.1	Mine Safety Disclosures.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document

28 

RPC, INC. AND SUBSIDIARIES

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 thereunto duly authorized.

	RPC, INC.
	/s/ Richard A. Hubbell
Date: April 28, 2017	Richard A. Hubbell
	President and Chief Executive Officer
	(Principal Executive Officer)
	/s/ Ben M. Palmer
Date: April 28, 2017	Ben M. Palmer
	Vice President, Chief Financial Officer and Treasurer
	(Principal Financial and Accounting Officer)

29 

EX-3.2

Exhibit 3.2

AMENDED AND RESTATED BY-LAWS

OF

RPC, INC.

April 25, 2017

OFFICES

FIRST:     The principal office of the corporation shall be located at 2801 Buford Highway NE, Suite 520, in the City of Atlanta, Georgia, and the registered agent shall be Corporation Service Company or such other agent as the corporation shall designate.

CORPORATE SEAL

SECOND:     The corporate seal shall have inscribed thereon the name of the corporation, the year of its incorporation and the words “Incorporated Delaware.”

MEETINGS OF STOCKHOLDERS

THIRD:     The annual meeting of stockholders for the election of directors shall be held on the fourth Tuesday of April at such office of the corporation or such other place as may be designated by the board of directors and included in the notice of such meeting, in each year, or if that day be a legal holiday, on the next succeeding day not a legal holiday, at which meeting they shall elect by ballot, by plurality vote, a board of directors and may transact such other business as may come before the meeting.

Special meetings of the stockholders may be called at any time by the chairman and shall be called by the chairman or secretary on the request in writing or by vote of a majority of the directors or at the request in writing of stockholders of record owning a majority in amount of the capital stock outstanding and entitled to vote. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the corporation’s notice of the meeting.

All such meetings of the stockholders shall be held at such place or places within or without the State of Delaware, as may from time to time be fixed by the board of directors or as shall be specified and fixed by the respective notices or waivers of notice thereof.

1 

Each stockholder entitled to vote shall, at every meeting of the stockholders, be entitled to one vote in person or by proxy, signed by him, for each share of voting stock held by him, but no proxy shall be voted on after the meeting of stockholders for which such proxy was solicited and which has been adjourned sine die. Such right to vote shall be subject to the right of the board of directors to close the transfer books or to fix a record date for voting stockholders as hereinafter provided and if the directors shall not have exercised such right, no share of stock shall be voted on at any election for directors which shall have been transferred on the books of the corporation within twenty days next preceding such election.

Notice of all meetings shall be given by the secretary to each stockholder of record entitled to vote not less than ten calendar days nor more than sixty calendar days before any annual or special meeting either personally, by mail or by other lawful means. If mailed, such notice shall be deemed to be given when deposited in the United States mail with postage thereon prepaid, addressed to the stockholder at such person’s address as it appears on the stock transfer books of the corporation.

The holders of a majority of the stock outstanding and entitled to vote shall constitute a quorum, but the holders of a smaller amount may adjourn from time to time without further notice until a quorum is secured.

DIRECTORS

FOURTH:     The property and business of this corporation shall be managed by or under the direction of a board of up to nine directors. The directors shall be divided into three classes of approximately equal size except that the classes may be unequal as a result of the death, resignation, removal or other vacancy of a member of a class unless a class were to have no members remaining, in which case such class vacancy will be filled as soon as practicable. Subject to the foregoing sentence, there shall be no limitation on the number of directors that may be designated to a particular class. At each Annual Meeting of Stockholders, the successors to the class of directors whose term expires at that time shall be elected to hold office for the term of three years to succeed those whose term expires, so that the term of office of one class of directors shall expire in each year. Each director shall hold office for the remainder of the term for which he is elected or appointed or until his successor shall be elected and qualified, or until his death or until he shall resign.

2 

POWERS OF DIRECTORS

FIFTH:     The board of directors shall have, in addition to such powers as are hereinafter expressly conferred on it, all such powers as may be exercised by the corporation, subject to the provisions of the statute, the certificate of incorporation and the by-laws.

The board of directors shall have power:

To purchase or otherwise acquire property, rights or privileges for the corporation, which the corporation has power to take, at such prices and on such terms as the board of directors may deem proper.

To pay for such property, rights or privileges in whole or in part with money, stock, bonds, debentures or other securities of the corporation, or by the delivery of other property to the corporation.

To create, make and issue mortgages, bonds, deeds of trust, trust agreements and negotiable or transferable instruments and securities, secured by mortgages or otherwise, and to do every other act and thing necessary to effectuate the same.

To appoint agents, clerks, assistants, factors, employees and trustees, and to dismiss them at its discretion, to fix their duties and emoluments and to change them from time to time and to require security as it may deem proper. Any employee appointed by the board may be given such designation or title as the board shall determine; however, any such designation or title given any such employee shall not be deemed to constitute such employee a corporate officer under ARTICLE EIGHTH of these by-laws.

To confer on any officer of the corporation the power of selecting, discharging or suspending such employees.

To determine by whom and in what manner the corporation’s bills, notes, receipts, acceptances, endorsements, checks, releases, contracts or other documents shall be signed.

3 

MEETINGS OF DIRECTORS

SIXTH:     After such annual election of directors, the newly elected directors may meet for the purpose of organization, the election of officers and the transaction of other business, at such place and time as the directors may determine, and, if a majority of the directors be present at such place and time, no prior notice of such meeting shall be required to be given to the directors. The place and time of such meeting may also be fixed by written consent of the directors.

Regular meetings of the directors shall be held annually following the stockholders meeting on the fourth Tuesday of April and quarterly on the fourth Tuesdays of July, October and January of each year at the executive office of the corporation in Atlanta, Georgia, or elsewhere and at other times as may be fixed by resolution of the board.

Special meetings of the directors may be called by the chairman, vice chairman or president or upon the request of any two directors. Two business days’ notice of any special meeting of directors shall be given in writing if such notice is delivered by first class or overnight mail or one business days’ notice if such notice is given orally or delivered by facsimile transmission or other form of electronic transmission reasonable under the circumstance or hand delivery.

Special meetings of the directors may be held within or without the State of Delaware at such places as is indicated in the notice or waiver of notice thereof.

A majority of the directors shall constitute a quorum, but a smaller number may adjourn from time to time, without further notice, until a quorum is secured.

The board may, by resolution passed by a majority of the whole board, designate one or more committees, each committee to consist of one or more directors of the corporation.

Any such committee to the extent provided in the directors’ resolution or in these by-laws, shall have and may exercise all the powers and authority of the board in managing the affairs and business of the Corporation and may authorize affixation of the corporate seal to all papers that require it, to the fullest extent permitted by law as presently allowed under Section 141 of the Delaware General Corporation Law (the “DGCL”) and as may be allowed in the future pursuant to amendments and revisions of applicable law; provided, however, that a committee may not have the power and authority to declare a dividend or to authorize the issuance of stock.

4 

COMPENSATION OF DIRECTORS

AND MEMBERS OF COMMITTEES

SEVENTH:     Directors and members of standing committees shall receive such compensation for attendance at each regular or special meeting as the board shall from time to time prescribe.

OFFICERS OF THE CORPORATION

EIGHTH:     The officers of the corporation shall be a chairman, a president, a secretary, a treasurer and such other officers as may from time to time be chosen by the board of directors. The board of directors in its discretion may also appoint a vice chairman who may or may not be an officer of the corporation. The chairman and, if applicable, vice chairman shall be chosen from among the directors.

One person may hold more than one office.

The officers of the corporation shall hold office until their successors are chosen and qualify in their stead. Any officer chosen or appointed by the board of directors may be removed either with or without cause at any time by the affirmative vote of a majority of the whole board of directors. If the office of any officer or officers becomes vacant for any reason, the vacancy may be filled by the affirmative vote of a majority of the whole board of directors or the board could eliminate the position, combine its duties with another position or fill it on an interim basis.

DUTIES OF THE CHAIRMAN

NINTH:     It shall be the duty of the chairman to preside at all meetings of stockholders and directors; to have general and active management of the business of the corporation; and to see that all orders and resolutions of the board of directors are carried into effect. The chairman shall be vested with all the powers and be required to perform all the duties of the president in his absence or disability.

5 

DUTIES OF THE VICE CHAIRMAN

TENTH:     The vice chairman, if any, shall perform such duties as shall be assigned by the chairman or the board of directors and shall be vested with all the powers and be required to perform all the duties of the chairman in the chairman’s absence or disability.

DUTIES OF THE PRESIDENT

ELEVENTH:     The president shall be the chief executive officer of the corporation. It shall be the duty of the president to execute, unless otherwise delegated, all contracts, agreements, deeds, bonds, mortgages and other obligations and instruments, in the name of the corporation, and to affix the corporate seal thereto when authorized by the board. The president shall supervise and direct the officers of the corporation other than the chairman and, if applicable, the vice chairman, and shall see that their duties are property performed.

In the absence or in case of the disability of the vice chairman, the president shall be vested with all the powers and be required to perform all the duties of the chairman in the chairman’s absence or disability.

SECRETARY

TWELFTH:     The secretary shall attend all meetings of the board of directors, and all other meetings as directed by the board of directors. The secretary shall act as clerk thereof and shall record all of the proceedings of such meetings in a book kept for that purpose. The secretary shall give proper notice of meetings of stockholders and directors and shall perform such other duties as shall be assigned by the chairman, vice chairman or president of the corporation.

6 

TREASURER

THIRTEENTH:     The treasurer shall have custody of the funds and securities of the corporation and shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the board of directors.

The treasurer shall keep an account of stock registered and transferred in such manner and subject to such regulations as the board of directors may prescribe.

The treasurer shall give the corporation a bond, if required by the board of directors, in such sum and in form and with security satisfactory to the board of directors for the faithful performance of the duties of the office and the restoration to the corporation, in case of the treasurer’s death, resignation or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his possession, belonging to the corporation. The treasurer shall perform such other duties as the board of directors may from time to time prescribe or require.

DUTIES OF OFFICERS MAY BE DELEGATED

FOURTEENTH:     In case of the absence or disability of any officer of the corporation or for any other reason deemed sufficient by a majority of the board, the board of directors may delegate such officer’s powers or duties to any other officer or to any director for the time being.

CERTIFICATES OF STOCK; UNCERTIFICATED SHARES

FIFTEENTH:     Shares of stock in the corporation may be represented by certificates or may be issued in uncertificated form in accordance with the DGCL. The issuance of shares in uncertificated form shall not affect shares already represented by a certificate until the certificate is surrendered to the corporation. Each holder of stock in the corporation represented by a certificate shall be entitled to a certificate which shall be signed by either the chairman, the vice chairman or the president and any of the treasurer, assistant treasurer, secretary or assistant secretary. If a certificate of stock be lost or destroyed, another may be issued in its stead upon proof of such loss or destruction and the giving of a satisfactory bond of indemnity, in an amount sufficient to indemnify the corporation against any claim. A new certificate may be issued without requiring bond when, in the judgment of the directors, it is proper to do so. Certificates may be signed by facsimile signature if so ordered by the board of directors.

7 

TRANSFER OF STOCK

SIXTEENTH:     Transfers of stock shall be made only upon the transfer books of the corporation kept at an office of the corporation or by a transfer agent designated to transfer shares of stock of the corporation. The certificate for the number of shares involved which are represented by a certificate shall be surrendered for cancellation before a new certificate is issued therefore.

The corporation shall have authority to appoint transfer agents and registrars by resolution of the board of directors.

CLOSING OF TRANSFER BOOKS

SEVENTEENTH:     The board of directors shall have power to close the stock transfer books of the corporation for a period not exceeding sixty days preceding the date of any meeting of stockholders or the date for payment of any dividend or the date for the allotment of rights or the date when any change or conversion or exchange of capital stock shall go into effect or for a period of not exceeding sixty days in connection with obtaining the consent of stockholders for any purpose; provided, however, that in lieu of closing the stock transfer books as aforesaid, the by-laws may fix or authorize the board of directors to fix in advance a date not exceeding sixty days preceding the date of any meeting of stockholders or the date for the payment of any dividend, or the date for the allotment of rights or the date when any change or conversion or exchange of capital stock shall go into effect, or a date in connection with obtaining such consent, and in such case such stockholders and only such stockholders as shall be stockholders of record on the date so fixed shall be entitled to such notice of, and to vote at such meeting and any adjournment thereof, or to receive payment of such dividend, or to receive such allotment of rights, or to exercise such rights, or to give such consent, as the case may be, notwithstanding any transfer of any stock on the books of the corporation after any such record date fixed as aforesaid.

8 

STOCKHOLDERS OF RECORD

EIGHTEENTH:     The corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and accordingly shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person whether or not it shall have express or other notice thereof, save as expressly provided by the laws of Delaware.

FISCAL YEAR

NINETEENTH:     The fiscal year of the corporation shall begin on the first day of January in each year.

DIVIDENDS

TWENTIETH:     Dividends upon the capital stock may be declared by the board of directors at any regular or special meeting and may be paid in cash or in property or in shares of the capital stock. Before paying any dividend or making any distribution of profits, the directors may set apart out of any of the funds of the corporation available for dividends a reserve or reserves for any proper purpose and may alter or abolish any such reserve or reserves.

CHECKS FOR MONEY

TWENTY-FIRST:     All checks, drafts or orders for the payment of money shall be signed by the treasurer or by such other officer or officers as the board of directors may from time to time designate. No check shall be signed in blank. The board of directors also from time to time may authorize specified employees to sign checks on the corporation’s accounts.

BOOKS AND RECORDS

TWENTY-SECOND:     The books, accounts and records of the corporation except as otherwise required by the laws of the State of Delaware, may be kept within or without the State of Delaware, at such place or places as may from time to time be designated by the by-laws or by resolution of the Directors.

9 

WAIVER OF NOTICES

TWENTY-THIRD:     Any stockholder or director may waive, in writing, any notice, required to be given under these by-laws whether before or after the time stated therein.

INDEMNIFICATION OF DIRECTORS,

OFFICERS AND EMPLOYEES

TWENTY-FOURTH:     The corporation shall indemnify and hold harmless, in the manner and to the fullest extent now or hereafter permitted by the DGCL, any person (or the estate of any person) who was or is a party to, or is involved in or threatened to be made a party to, any threatened, pending or completed action, suit or proceeding, whether or not by or in the right of the corporation and whether civil, criminal, administrative, investigative or otherwise, by reason of the fact that such person is or was a director, officer or general counsel of the corporation, or is or was serving at the request of the corporation as a director, officer, general counsel of another corporation, partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans. The indemnification provided herein shall be made if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interest of the corporation, and, with respect to any criminal action or proceeding, has no reasonable cause to believe his or her conduct was unlawful; provided, however, that, except as provided in the following paragraph, the corporation shall indemnify any such person seeking indemnification in connection with a proceeding initiated by such person only if such proceeding was authorized by the board of directors. To the full extent permitted by law, the indemnification provided herein shall include all expense, liability and loss (including attorneys’ fees, judgments, fines and amounts paid or to be paid in settlement) reasonably incurred or suffered by such person. The corporation shall pay the expenses (including attorneys’ fees) incurred in defending any such proceeding in advance of its final disposition upon the receipt by the corporation of a statement or statements from the claimant requesting such advance and an undertaking by or on behalf of such claimant that the claimant will repay all amounts so advanced if it shall ultimately be determined that such director or officer is not entitled to be indemnified under this ARTICLE TWENTY-FOURTH or otherwise. The indemnification and advancement of expenses provided herein (a) shall not be deemed to limit the right of the corporation to indemnify any other employee or agent and advance any such expenses to the full extent provided by the law, nor shall it be deemed exclusive of any other rights to which any person seeking indemnification and advancement of expenses from the corporation may be entitled under any agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office, (b) is intended to be retroactive and shall be available with respect to events occurring prior to adoption of this ARTICLE TWENTY-FOURTH, and (c) shall continue as to an indemnitee who has ceased to be a director of officer and shall inure to the benefit of the indemnitee’s heirs, executors and administrators. The corporation may, to the full extent permitted by law, purchase and maintain insurance on behalf of any such person against any liability which may be asserted against such person.

10 

If a claim under this of this ARTICLE TWENTY-FOURTH is not paid in full within 30 calendar days after a written claim has been received by the corporation, the claimant may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall be entitled to be paid the reasonable expense of prosecuting the claim. It shall be a defense to any such action to enforce a right to indemnification (but not to an action to enforce a right to an advancement of expenses) that the claimant has not met the standard of conduct which makes it permissible under the DGCL to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the corporation.

No repeal or modification of this ARTICLE TWENTY-FOURTH shall in any way diminish or adversely affect the rights of any person in respect of any occurrence or matter arising prior to any such repeal or modification. If any provision of this ARTICLE TWENTY-FOURTH shall be held to be invalid, illegal or unenforceable for any reason whatsoever, the validity, legality and enforceability of the remaining provisions of this ARTICLE TWENTY-FOURTH shall not in any way be affected or impaired thereby.

The corporation shall not be liable to indemnify any indemnitee under this ARTICLE TWENTY-FOURTH for any amounts paid in settlement of any proceeding (or part thereof) effected without the corporation’s written consent, which consent shall not be unreasonably withheld, or for any judicial award if the corporation was not given a reasonable and timely opportunity, at its expense, to participate in the defense of such proceeding. The board of directors may establish reasonable procedures for the submission of claims for indemnification pursuant to this ARTICLE TWENTY-FOURTH, determination of the entitlement of any person thereto, and review of any such determination.

11 

NON-DISCRIMATION STATEMENT

TWENTY-FIFTH:     Consistent with the corporation’s equal employment opportunity policy, nominations for the elections of directors shall be made by the board of directors and voted upon by the stockholders in a manner consistent with these by-laws and without regard to the nominee’s race, color, ethnicity, religion, sex, age, national origin, veteran status, or disability.

NOTICE OF NOMINATION OF DIRECTORS

TWENTY-SIXTH:     Only persons who are nominated in accordance with the following procedures shall be eligible for election as directors of the corporation. Nominations of persons for election to the board of directors may be made at any annual meeting of stockholders, or at any special meeting of stockholders called for the purpose of electing directors, (a) by or at the direction of the board of directors (or any duly authorized committee thereof) or (b) by any stockholder of the Corporation (i) who is a stockholder of record on the date of the giving of the notice provided for in this ARTICLE TWENTY-SIXTH and on the record date for the determination of stockholders entitled to vote at such meeting and (ii) who complies with the requirements and notice procedures set forth in this ARTICLE TWENTY-SIXTH. Shareholders will not be entitled to nominate any candidate for director at any annual or special meeting unless the shareholder shall have first provided notice in writing, delivered or mailed by first class United States mail, postage prepaid, to the secretary of the corporation so that it is received (a) not less than ninety, nor more than one hundred thirty days prior to the anniversary of the prior year’s annual meeting of stockholders with respect to an annual meeting; provided, however, that in the event the annual meeting is scheduled to be held on a date more than 30 days prior to or delayed by more than 60 days after such anniversary date, notice by the stockholder in order to be timely must be so received not later than the later of the close of business 90 days prior to such annual meeting or the tenth day following the day on which such notice of the date of the annual meeting was mailed or such public disclosure of the date of the annual meeting was made and (b) in the case of a special meeting of stockholders called for the purpose of electing directors, not later than the close of business on the tenth day following the day on which notice of the date of the special meeting was mailed or public disclosure of the date of the special meeting was made, whichever first occurs (and in no event shall the public announcement of an adjournment of the meeting commence a new time period for a giving of a stockholder’s notice under this ARTICLE).

12 

Each such notice shall set forth (a) with respect to the nominee, (i) the name, age, business address and, if known, residence address of each nominee proposed in such notice, (ii) the principal occupation or employment of each such nominee for the past five years, (iii) the class or series and number of shares of capital stock of the corporation which are owned beneficially or of record by the person, (iv) as an appendix, a completed and signed questionnaire, representation and agreement required by this ARTICLE TWENTY-SIXTH, (v) such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected, and (vi) any other information relating to the person that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors pursuant to Section 14 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations promulgated there under; (b) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination is made (i) the name and record address of such stockholder, as it appears on the corporation’s books, and of such beneficial owner, (ii) the class or series and number of shares of capital stock of the corporation which are owned beneficially or of record by such stockholder and such beneficial owner, (iii) a description of all arrangements or understandings between such stockholder and such beneficial owner and each proposed nominee and any other person or persons (including their names) pursuant to which the nomination(s) are to be made by such stockholder, (iv) a description of any agreement, arrangement or understanding (including any derivative or short positions, profit interests, options, warrants, convertible securities, stock appreciation or similar rights, hedging transactions, and borrowed or loaned shares) that has been entered into as of the date of the stockholder’s notice by, or on behalf of , such stockholder and such beneficial owner, whether or not such instrument or right shall be subject to settlement in underlying shares of capital stock, the effect or intent of which is to mitigate loss to, manage risk or benefit of share price changes for, or increase or decrease the voting power of, such stockholder or such beneficial owner, with respect to the securities of the corporation (collectively, a “Derivative Instrument”), (v) a representation that such stockholder intends to appear in person or by proxy at the meeting to nominate the person named in its notice, and (vi) any other information relating to such stockholder that would be required to be disclosed in a proxy statement or other filings required to be made in connection: with solicitations of proxies for election of directors pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated there under; and (c) whether such stockholder or beneficial owner has delivered or intends to deliver a proxy statement and form of proxy to holders of a sufficient number of holders of the Corporation’s voting shares to elect such nominee or nominees.

13 

The chairman of the meeting may, if the facts warrant, determine and declare to the meeting that a shareholder failed to provide notice of a nomination in accordance with the foregoing procedure, and if he should so determine, he may so declare to the meeting and the defective nomination shall be disregarded.

To be eligible to be a nominee for election as a director of the corporation, a person must deliver in accordance with the time periods prescribed for delivery of notice under this ARTICLE TWENTY-SIXTH to the secretary of the corporation a written questionnaire with respect to the background and qualification of such person and the background of any other person or entity on whose behalf the nomination is being made (which questionnaire shall be provided by the secretary upon written request) and a written representation and agreement (in the form provided by the secretary upon written request) that such proposed nominee satisfied the Applicable Qualification Standards (as defined below) and (1) is not and will not become a party to (A) any agreement, arrangement or understanding with , and has not given any commitment or assurance to, any person or entity as to how such person, if elected as a director of the corporation, will act or vote on any issue or question (a “Voting Commitment”) that has not been disclosed to the corporation or (B) any Voting Commitment that could limit or interfere with such person’s ability to comply, if elected as a director of the corporation, with such person’s fiduciary duties under applicable law, (2) is not and will not become a party to any agreement, arrangement or understanding with any person or entity other than the corporation with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as a director that has not been disclosed therein, and (3) in such person’s individual capacity and on behalf of any such person or entity on whose behalf the nomination is being made, would be in compliance, if elected as a director of the corporation, and will comply, with all applicable corporate governance, conflict of interest, confidentiality and stock ownership and trading policies and guidelines of the corporation. For purposes hereof, “Applicable Qualification Standards” shall mean that the proposed nominee has relevant business experience (taking into account the business experience of the other directors) as determined by the board or a committee thereof, in its sole discretion, and satisfies such other criteria for service on the board of directors as may be established from time to time by the board.

14 

Notwithstanding the provisions of the by-laws, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in these by-laws; provided, however that any references in these by-laws to the Exchange Act or the rules promulgated thereunder are not intended to and shall not limit the separate and additional requirements set forth in these by-laws with respect to nominations to be considered pursuant to ARTICLE TWENTY-SIXTH of these by-laws.

STOCKHOLDER PROPOSALS FOR BUSINESS
TO BE TRANSACTED AT MEETING

TWENTY-SEVENTH: At any special meeting of the stockholders, such Business (as defined below) shall be conducted as shall have been brought before the meeting by or at the direction of the board of directors. No business may be transacted at an annual meeting of stockholders, other than Business that is either (a) specified in the notice of meeting (or any supplement thereto), given by or at the direction of the board of directors, (b) otherwise properly brought before the annual meeting by or at the direction of the board of directors or (c) otherwise properly brought before the annual meeting by any stockholder of record of the corporation (i) who is a stockholder of record on the date of the giving of the notice provided for in this ARTICLE TWENTY SEVENTH and on the record date for the determination of stockholders entitled to vote at such annual meeting and (ii) who complies with the notice procedures set forth in this ARTICLE TWENTY-SEVENTH. With respect to this ARTICLE TWENTY-SEVENTH, “Business” shall mean all matters other than nominations of candidates for and the election of directors. Stockholder nomination of directors for election is governed solely by ARTICLE TWENTY-SIXTH of these by-laws.

15 

In addition to any other applicable requirements (including, without limitation, Securities and Exchange Commission rules and regulations with respect to matters set forth in this ARTICLE TWENTY-SEVENTH), for Business to be properly brought before an annual meeting by a stockholder, (i) such stockholder must have given timely notice thereof in proper written form to the secretary of the corporation, (ii) such Business must be a proper matter for stockholder action under the DGCL, (iii) if the stockholder, or the beneficial owner on whose behalf any such proposal is made, has provided the corporation with a Solicitation Notice (as defined herein), such stockholder or beneficial owner must, in the case of a proposal, have delivered a proxy statement and form of proxy to holders of at least the percentage of the corporation’s voting shares required under applicable law to carry any such proposal, and must have included in such materials the Solicitation Notice and (iv) if no Solicitation Notice relating thereto has been timely provided pursuant to this ARTICLE TWENTY-SEVENTH, the stockholder or beneficial owner proposing such Business must not have solicited a number of proxies sufficient to have required the delivery of the Solicitation Notice under this section.

To be timely, a stockholder’s notice to the secretary must be delivered to or mailed and received at the principal executive offices of the corporation not less than 90 days nor more than 130 days prior to the date of the anniversary of the previous year’s annual meeting; provided, however, that in the event the annual meeting is scheduled to be held on a date more than 30 days prior to or is delayed by more than 60 days after such anniversary date, notice by the stockholder in order to be timely must be so received not later than the later of the close of business 90 days prior to such annual meeting or the tenth day following the day on which such notice of the date of the annual meeting was mailed or such public announcement of the date of the annual meeting was first made by the corporation. In no event shall the public announcement of an adjournment of an annual meeting commence a new time period for a giving of a stockholder’s notice under this ARTICLE TWENTY-SEVENTH.

16 

To be in proper written form, a stockholder’s notice to the secretary must set forth as to each matter of Business such stockholder proposes to bring before the annual meeting (i) a brief description of the Business desired to be brought before the annual meeting and the reasons for conducting such Business at the annual meeting, (ii) the name and record address of such stockholder and the name and address of the beneficial owner, if any, on whose behalf the proposal is made, (iii)(A) the class or series and number of shares of capital stock of the corporation which are owned beneficially or of record by such stockholder and such beneficial owner and any Stockholder Associated Person, directly or indirectly (“Stockholder Associated Person” of any stockholder shall mean (i) any person controlling, directly or indirectly, or acting in concert with, such stockholder, (ii) any beneficial owner of shares of stock of the corporation owned of record or beneficially by such stockholder and (iii) any person controlled by or under common control with such Stockholder Associated Person), (B) any Derivative Instrument directly or indirectly owned beneficially by such stockholder, beneficial owner or Stockholder Associated Person and any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the corporation owned by any of them, (C) any proxy, contract, arrangement, understanding, or relationship pursuant to which such stockholder, beneficial owner or Stockholder Associated Person has a right to vote any shares of any security of the corporation or any person has the right to vote their shares, (D) any short interest in any security of the corporation of such stockholder, beneficial owner or Stockholder Associated Person (for purposes of this provision a person shall be deemed to have a short interest in a security if such person directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, has the opportunity to profit or share in any profit derived from any decrease in the value of the subject security), (E) any rights to dividends on the shares of the corporation owned beneficially by such stockholder, beneficial owner or Stockholder Associated Person that are separated or separable from the underlying shares of the corporation, (F) any proportionate interest in shares of the corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such stockholder, beneficial owner or Stockholder Associated Person is a general partner and (G) any performance-related fees (other than an asset-based fee) that such stockholder, beneficial owner or Stockholder Associated Person is entitled to base on any increase or decrease in the value of shares of the corporation or Derivative Instruments, if any, as of the date of such notice, including without limitation any such interests held by members of such person’s immediate family sharing the same household (which information shall be supplemented by such person or beneficial owner, if any, not later than 10 days after the record date for the meeting to disclose such ownership as of the record date), (iv) a description of all arrangements or understandings between such stockholder and any other person or persons (including their names) in connection with the proposal of such Business by such stockholder or beneficial owner and any material interest of such stockholder, beneficial owner or Stockholder Associated Person in such Business, (v) the names and addresses of other stockholders and beneficial owners known by the stockholder or beneficial owner proposing such Business to support the proposal, and the class and number of shares of the corporation’s capital stock known to be beneficially owned by such other stockholders and beneficial owners, (vi) a representation that such stockholder or beneficial owner intends to appear in person or by proxy at the annual meeting to bring such Business before the meeting, and (vii) whether such stockholder or beneficial owner has delivered or intends to deliver a proxy statement and form of proxy to holders of at least the percentage of the corporation’s voting shares required to carry the proposal (an affirmative statement of such intent a “Solicitation Notice”).

17 

No business shall be conducted at the annual meeting of stockholders except Business brought before the annual meeting in accordance with the procedures set forth in this ARTICLE TWENTY-SEVENTH, provided, however, that, once Business has been properly brought before the annual meeting in accordance with such procedures, nothing in this ARTICLE TWENTY-SEVENTH shall be deemed to preclude discussion by any stockholder of any such Business. If the chairman of an annual meeting determines that business was not properly brought before the annual meeting in accordance with the foregoing procedures, the chairman of the meeting may declare to the meeting that the business was not properly brought before the meeting and such business shall not be transacted.

Notwithstanding the foregoing provisions of ARTICLE TWENTY-SEVENTH, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in these by-laws; provided, however, that any references in these by-laws to the Exchange Act or the rules promulgated thereunder are not intended to and shall not limit the requirements of these by-laws applicable to nominations or proposals as to any other business to be considered pursuant to these by-laws, regardless of the stockholder’s intent to utilize Rule 14a-8 under the Exchange Act or other federal laws or rules. Nothing in these by-laws shall be deemed to affect any rights (i) of stockholders to request inclusion of proposals in the corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act or (ii) of the holders of any series of preferred stock if and to the extent required by law, the certificate of incorporation or these by-laws.

18 

FORUM SELECTION

TWENTY-EIGHTH: Unless the corporation consents in writing to the selection of an alternative forum, to the fullest extent permitted by law, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the corporation to the corporation or the corporation’s stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL, or (iv) any action asserting a claim governed by the internal affairs doctrine (the actions or proceedings described in clauses (i) through (iv) of this ARTICLE TWENTY-EIGHTH, collectively, an “Intracorporate Proceeding”) shall be the Court of Chancery of the State of Delaware (or if the Court of Chancery does not have jurisdiction, another state court located within the State of Delaware or, if no state court located within the jurisdiction has jurisdiction, the federal district court for the District of Delaware), in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants. Any person or entity purchasing or otherwise acquiring any interest in shares of the capital stock of the corporation shall be deemed to have notice of and consented to the provisions of this ARTICLE TWENTY-EIGHTH.

AMENDMENTS OF BY-LAWS

TWENTY-NINTH :     These by-laws may be amended, altered, repealed, or added to at any regular meeting of the stockholders or board of directors or at any special meeting called for that purpose, by affirmative vote of a majority of the stock issued and outstanding and entitled to vote or of a majority of the directors in office, as the case may be.

19 

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Richard A. Hubbell, certify that:

1. I have reviewed this quarterly report on Form 10-Q of RPC, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	/s/ Richard A. Hubbell
Date: April 28, 2017	Richard A. Hubbell
	President and Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS

I, Ben M. Palmer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of RPC, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	/s/ Ben M. Palmer
Date: April 28, 2017	Ben M. Palmer
	Vice President, Chief Financial Officer, and Treasurer
	(Principal Financial and Accounting Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION OF PERIODIC FINANCIAL REPORTS PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

To the best of their knowledge the undersigned hereby certify that the Quarterly Report on Form 10-Q of RPC, Inc. for the period ended March 31, 2017, fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. Sec. 78m) and that the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of RPC, Inc.

Date: April 28, 2017	/s/ Richard A. Hubbell
	Richard A. Hubbell
	President and Chief Executive Officer
	(Principal Executive Officer)
Date: April 28, 2017	/s/ Ben M. Palmer
	Ben M. Palmer
	Vice President, Chief Financial Officer and Treasurer
	(Principal Financial and Accounting Officer)

EX-95

EXHIBIT 95

MINE SAFETY ACT DISCLOSURE

Certain of our operations are classified as mines and are subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”). MSHA inspects our mines on a regular basis and issues various citations and orders when it believes a violation has occurred under the Mine Act. In the first quarter of 2017, we were issued certain mine safety and health citations by the MSHA under the Mine Act including for MSHA Property 47-03629: one citation that has not been assessed and for MSHA Property 47-03628: one citation with assessment totaling $116.

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Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2017	Apr. 21, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	RPC INC
Entity Central Index Key	0000742278
Trading Symbol	res
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		217,779,939
Document Type	10-Q
Document Period End Date	Mar. 31, 2017
Amendment Flag	false
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q1

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CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
ASSETS
Cash and cash equivalents	$ 104,498	$ 131,835
Accounts receivable, net of allowance for doubtful accounts of $2,956 in 2017 and $2,553 in 2016	246,583	169,166
Inventories	111,945	108,316
Income taxes receivable	48,461	57,174
Prepaid expenses	6,897	6,718
Other current assets	6,269	5,848
Total current assets	524,653	479,057
Property, plant and equipment, less accumulated depreciation of $1,631,602 in 2017 and $1,595,508 in 2016	465,249	497,986
Goodwill	32,150	32,150
Other assets	27,002	26,259
Total assets	1,049,054	1,035,452
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	92,270	70,536
Accrued payroll and related expenses	17,528	12,130
Accrued insurance expenses	4,681	4,099
Accrued state, local and other taxes	4,746	3,094
Income taxes payable	3,805	4,929
Other accrued expenses	1,740	6,680
Total current liabilities	124,770	101,468
Long-term accrued insurance expenses	9,882	9,537
Long-term pension liabilities	33,637	32,864
Deferred income taxes	69,869	81,466
Other long-term liabilities	3,288	3,318
Total liabilities	241,446	228,653
Common stock	21,778	21,749
Capital in excess of par value
Retained earnings	803,770	803,152
Accumulated other comprehensive loss	(17,940)	(18,102)
Total stockholders' equity	807,608	806,799
Total liabilities and stockholders' equity	$ 1,049,054	$ 1,035,452

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CONSOLIDATED BALANCE SHEETS (Unaudited) (Parentheticals) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Statement Of Financial Position [Abstract]
Allowance for doubtful accounts	$ 2,956	$ 2,553
Accumulated depreciation of property, plant and equipment	$ 1,631,602	$ 1,595,508

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CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Income Statement [Abstract]
Revenues	$ 298,119	$ 189,095
Cost of revenues (exclusive of items shown below)	216,242	161,256
Selling, general and administrative expenses	37,157	43,546
Depreciation and amortization	44,663	60,636
Gain on disposition of assets, net	(1,517)	(1,256)
Operating income (loss)	1,574	(75,087)
Interest expense	(103)	(325)
Interest income	129	23
Other income, net	212	342
Income (loss) before income taxes	1,812	(75,047)
Income tax benefit	(1,822)	(42,536)
Net income (loss)	$ 3,634	$ (32,511)
Earnings (loss) per share
Basic (in dollars per share)	$ 0.02	$ (0.15)
Diluted (in dollars per share)	0.02	(0.15)
Dividends per share (in dollars per share)

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Statement Of Income and Comprehensive Income [Abstract]
Net income (loss)	$ 3,634	$ (32,511)
Other comprehensive income (loss):
Pension adjustment and reclassification adjustment, net of taxes	135	127
Foreign currency translation	42	692
Unrealized loss on securities, net of taxes	(15)	(9)
Comprehensive income (loss)	$ 3,796	$ (31,701)

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CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited) - 3 months ended Mar. 31, 2017 - USD ($) shares in Thousands, $ in Thousands	Common Stock	Capital in Excess of Par Value	Retained Earnings	Accumulated Other Comprehensive Loss	Total
Balance at Dec. 31, 2016	$ 21,749		$ 803,152	$ (18,102)	$ 806,799
Balance (in shares) at Dec. 31, 2016	217,489
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock issued for stock incentive plans, net	$ 55	2,632			2,687
Stock issued for stock incentive plans, net (in shares)	550
Stock purchased and retired	$ (26)	$ (2,632)	(3,016)		(5,674)
Stock purchased and retired (in shares)	(259)
Net income			3,634		3,634
Pension adjustment, net of taxes				135	135
Foreign currency translation				42	42
Unrealized loss on securities, net of taxes				(15)	(15)
Balance at Mar. 31, 2017	$ 21,778		$ 803,770	$ (17,940)	$ 807,608
Balance (in shares) at Mar. 31, 2017	217,780

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
OPERATING ACTIVITIES
Net income (loss)	$ 3,634	$ (32,511)
Adjustments to reconcile net income (loss) to net cash (used for) provided by operating activities:
Depreciation, amortization and other non-cash charges	45,412	61,418
Stock-based compensation expense	2,687	2,660
Gain on disposition of assets, net	(1,517)	(1,256)
Deferred income tax benefit	(11,667)	(8,423)
Excess tax benefits for share-based payments		(403)
(Increase) decrease in assets:
Accounts receivable	(77,406)	56,887
Income taxes receivable	8,713	10,501
Inventories	(3,595)	3,674
Prepaid expenses	(179)	1,581
Other current assets	(429)	241
Other non-current assets	(749)	117
Increase (decrease) in liabilities:
Accounts payable	19,775	(29,410)
Income taxes payable	(1,124)	1,065
Accrued payroll and related expenses	5,399	(595)
Accrued insurance expenses	582	668
Accrued state, local and other taxes	1,652	1,140
Other accrued expenses	(4,938)	2,069
Pension liabilities	986	(732)
Long-term accrued insurance expenses	345	(1,099)
Other long-term liabilities	(30)	(14,120)
Net cash (used for) provided by operating activities	(12,449)	53,472
INVESTING ACTIVITIES
Capital expenditures	(11,707)	(9,581)
Proceeds from sale of assets	2,493	2,010
Net cash used for investing activities	(9,214)	(7,571)
FINANCING ACTIVITIES
Excess tax benefits for share-based payments		403
Cash paid for common stock purchased and retired	(5,674)	(3,191)
Net cash used for financing activities	(5,674)	(2,788)
Net (decrease) increase in cash and cash equivalents	(27,337)	43,113
Cash and cash equivalents at beginning of period	131,835	65,196
Cash and cash equivalents at end of period	104,498	108,309
Supplemental cash flows disclosure:
Interest paid, net of amounts capitalized		282
Income taxes paid (received), net	2,199	(32,487)
Supplemental disclosure of noncash investing activities:
Capital expenditures included in accounts payable	$ 5,322	$ 1,862

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GENERAL

3 Months Ended

Mar. 31, 2017

General [Abstract]

GENERAL

1. GENERAL

The accompanying unaudited consolidated financial statements include the accounts of RPC, Inc. and its wholly-owned subsidiaries (“RPC” or the “Company”) and have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. These consolidated financial statements have been prepared in accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 810, “Consolidation” and Rule 3A-02(a) of Regulation S-X. In accordance with ASC Topic 810 and Rule 3A-02 (a) of Regulation S-X, the Company’s policy is to consolidate all subsidiaries and investees where it has voting control.

In the opinion of management, all adjustments (all of which consisted of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017.

The balance sheet at December 31, 2016 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2016.

A group that includes the Company’s Chairman of the Board, R. Randall Rollins, and his brother Gary W. Rollins, who is also a director of the Company, and certain companies under their control, controls in excess of fifty percent of the Company’s voting power.

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REVENUES

3 Months Ended

Mar. 31, 2017

REVENUES

REVENUES

2. REVENUES

RPC’s revenues are generated principally from providing services and the related equipment. Revenues are recognized when the services are rendered and collectability is reasonably assured. Revenues from services and equipment are based on fixed or determinable priced purchase orders or contracts with the customer and do not include the right of return. Rates for services and equipment are priced on a per day, per unit of measure, per man hour or similar basis. Sales tax charged to customers is presented on a net basis within the consolidated statement of operations and excluded from revenues.

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RECENT ACCOUNTING PRONOUNCEMENTS

3 Months Ended

Mar. 31, 2017

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

3. RECENT ACCOUNTING PRONOUNCEMENTS

The Financial Accounting Standards Board (FASB) issued the following applicable Accounting Standards Updates (ASU):

Recently Adopted Accounting Pronouncements:

Accounting Standards Update (ASU) No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. Current requirements are to measure inventory at the lower of cost or market. Market could be replacement cost, net realizable value, or net realizable value less an approximated normal profit margin. These amendments allow inventory to be measured at lower of cost or net realizable value and eliminates the market requirement. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. The adoption of these provisions did not have a material impact on the Company’s consolidated financial statements.

ASU No. 2016-07, Investments — Equity Method and Joint Ventures (Topic 323) Simplifying the Transition to the Equity Method of Accounting. The amendments eliminate the requirement to adjust the investment, results of operations, and retained earnings retroactively when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence. The cost of acquiring the additional interest in the investee is to be added to the current basis of the investor’s previously held interest and the equity method is to be adopted as of the date the investment qualifies. In addition, an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting is required to recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. The adoption of these provisions did not have a material impact on the Company’s consolidated financial statements.

ASU No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments simplify several aspects of the accounting for share-based payment award transactions, requiring excess tax benefits and deficiencies to be recognized as a component of income tax expense rather than equity. This guidance also requires excess tax benefits and deficiencies to be presented as an operating activity on the statement of cash flows and allows an entity to make an accounting policy election either to estimate expected forfeitures or to account for them as they occur. The Company will continue to estimate expected forfeitures. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. See Notes 5 and 10 on Stock Based Compensation and Income Taxes, respectively, for the effect of adoption on the financial statements.

ASU No. 2016-17, Consolidation (Topic 810): Interests Held through Related Parties That are under Common Control. The amendments affect reporting entities that are required to evaluate whether they should consolidate a variable interest entity in certain situations involving entities under common control. Specifically, the amendments change the evaluation of whether a reporting entity is the primary beneficiary of a variable interest entity by changing how a reporting entity that is a single decision maker of a variable interest entity treats indirect interests in the entity held through related parties that are under common control with the reporting entity. The Company adopted these provisions in the first quarter of 2017 and the adoption did not have a material impact on its consolidated financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted:

To be adopted in 2018:

REVENUE RECOGNITION:

The Financial Accounting Standards Board and International Accounting Standards Board issued their converged standard on revenue recognition in May 2014. The standard provides a comprehensive, industry-neutral revenue recognition model intended to increase financial statement comparability across companies and industries and significantly reduce the complexity inherent in today’s revenue recognition guidance. The various ASUs related to Revenue from Contracts with Customers (Topic 606) have been listed below: 

● ASU No. 2014-09. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services using a five step process.

● ASU No. 2015-14 deferred the effective date of ASU 2014-09 for all entities by one year to the first quarter of 2018 with early application permitted.

● ASU No. 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net). The amendments provide guidance on whether an entity is a principal or agent when providing services to a customer along with another party.

● ASU No. 2016-10, Identifying Performance Obligations and Licensing. The amendments clarify the earlier guidance on identifying performance obligations and licensing implementation.

● ASU No. 2016-11, Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting. This ASU rescinds certain SEC guidance related to issues that are currently codified under various topics.

● ASU No. 2016-12, Narrow - Scope Improvements and Practical Expedients. The amendments provide clarifying guidance on certain aspects of the five step process and practical expedients regarding the effect of modifications and status of completed contracts under legacy GAAP and disclosures related to the application of this guidance using the modified retrospective or retrospective transition method.

● ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers. The amendments in ASU 2016-20 affect narrow aspects of the guidance issued in ASU 2014-09 and includes among others, loan guarantees, impairment testing of contract costs, performance obligations disclosures and accrual of advertising costs.

Current status of implementation:

The Company is currently analyzing the effect of the standard across all of its revenue streams to evaluate the impact of the new standard on revenue contracts. This includes reviewing current accounting policies and practices to identify potential differences that would result from applying the requirements under the new standard. Most of the Company’s services are primarily short-term in nature, and the assessment at this stage is that the Company does not expect the adoption of the new revenue recognition standard to have a material impact on its financial statements. The Company plans to adopt the standard in the first quarter of 2018 using the modified retrospective method by recognizing the cumulative effect of initially applying the new standard as an adjustment to the opening balance of retained earnings.

ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The amendments make targeted improvements to existing U.S. GAAP and affects accounting for equity investments and financial instruments and liabilities and related disclosures. The amendments are effective starting in the first quarter of 2018, with early adoption permitted for certain provisions. The Company is currently evaluating the impact of these provisions on its consolidated financial statements.

ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The amendments provide guidance in the presentation and classification of certain cash receipts and cash payments in the statement of cash flows including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, and distributions received from equity method investees. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. The amendments require an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments eliminate the exception for an intra-entity transfer of an asset other than inventory. Two common examples of assets included in the scope of the amendments are intellectual property and property, plant, and equipment. The amendments do not include new disclosure requirements; however, existing disclosure requirements might be applicable when accounting for the current and deferred income taxes for an intra-entity transfer of an asset other than inventory. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments are required to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-18, Statement of Cash Flows (230): Restricted Cash. The amendments require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. As a result, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments do not provide a definition of restricted cash or restricted cash equivalents. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments should be applied using a retrospective transition method to each period presented. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business: The amendments are intended to help companies and other organizations evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The amendments provide a more robust framework to use in determining when a set of assets and activities is a business. They also provide more consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable. The amendments are effective beginning in the first quarter of 2018 with early application permitted under certain circumstances. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. To simplify the subsequent measurement of goodwill, the amendments eliminate Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments are effective for annual or any interim goodwill impairment tests beginning in 2020 applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

To be adopted in 2019 and later:

ASU No. 2016-02, Leases (Topic 842). Under the new guidance, lessees will need to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease), at the commencement of the lease term. The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. The amendments in this standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Lessees and lessors may not apply a full retrospective transition approach. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The amendments require the credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration should presented as an allowance rather than a write-down. It also allows recording of credit loss reversals in current period net income. The amendments are effective starting in the first quarter of 2020 with early application permitted a year earlier. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

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EARNINGS (LOSS) PER SHARE

3 Months Ended

Mar. 31, 2017

EARNINGS (LOSS) PER SHARE

EARNINGS (LOSS) PER SHARE

4. EARNINGS (LOSS) PER SHARE

Basic and diluted earnings (loss) per share are computed by dividing net income (loss) by the weighted average number of shares outstanding during the respective periods. In addition, the Company has periodically issued share-based payment awards that contain non-forfeitable rights to dividends and are therefore considered participating securities. Restricted shares of common stock (participating securities) outstanding and a reconciliation of weighted average shares outstanding is as follows:

	Three months ended  March 31,
(In thousands)	2017			2016
Net income (loss) available for stockholders:	$	3,634		$	(32,511	)
Less:  Adjustments for earnings attributable to participating securities		(51	)		-
Net income (loss) used in calculating losses per share	$	3,583		$	(32,511	)
Weighted average shares outstanding (including participating securities)		217,713			217,433
Adjustment for participating securities		(3,042	)		(3,322	)
Shares used in calculating basic and diluted earnings (loss) per share		214,671			214,111

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STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2017

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

5. STOCK-BASED COMPENSATION

In April 2014, the Company reserved 8,000,000 shares of common stock under the 2014 Stock Incentive Plan with a term of 10 years expiring in April 2024.  This plan provides for the issuance of various forms of stock incentives, including, among others, incentive and non-qualified stock options and restricted shares.  As of March 31, 2017, there were 5,696,000 shares available for grant.

Stock-based employee compensation expense was as follows for the periods indicated:

	Three months ended
	March 31,
(in thousands)	2017		2016
Pre-tax expense	$	2,687	$	2,660
After tax expense	$	1,706	$	1,689

 Restricted Stock

The following is a summary of the changes in non-vested restricted shares for the three months ended March 31, 2017:

	Shares			Weighted Average  Grant-Date Fair  Value
Non-vested shares at December 31, 2016		3,217,075		$	12.91
Granted		563,065			21.66
Vested		(800,225	)		13.22
Forfeited		(13,500	)		13.50
Non-vested shares at March 31, 2017		2,966,415		$	14.49

The total fair value of shares vested was approximately $17,527,000 during the three months ended March 31, 2017 and $9,527,000 during the three months ended March 31, 2016. Excess tax benefits realized from tax compensation deductions in excess of compensation expense have been reflected as follows:

● $2,536,000 for the three months ended March 31, 2017 has been recorded as a discrete tax adjustment and classified within operating activities in the consolidated statements of cash flows; and

● $403,000 for the three months ended March 31, 2016 were credited to capital in excess of par value and classified within financing activities as an inflow in addition to being disclosed as an outflow within operating activities in the consolidated statements of cash flows. 

The change in classification for the first quarter of 2017 was in accordance with the amendments of ASU 2016-09.

As of March 31, 2017, total unrecognized compensation cost related to non-vested restricted shares was $48,182,000, which is expected to be recognized over a weighted-average period of 4.0 years.

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BUSINESS SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2017

BUSINESS SEGMENT INFORMATION

BUSINESS SEGMENT INFORMATION

6. BUSINESS SEGMENT INFORMATION

RPC’s reportable segments are the same as its operating segments. RPC manages its business as either services offered on the well site with equipment and personnel (Technical Services) or services and equipment offered off the well site (Support Services). The businesses under Technical Services generate revenue based on equipment, personnel operating the equipment and the materials utilized to provide the service. They are all managed, analyzed and reported based on the similarities of the operational characteristics and costs associated with providing the service. The businesses under Support Services are primarily able to generate revenue through one source, which is either a hard asset or a personnel resource. Selected overhead including certain centralized support services and regulatory compliance are classified under Corporate.

Technical Services include RPC’s oil and gas services that utilize people and equipment to perform value-added completion, production and maintenance services directly to a customer’s well. The demand for these services is generally influenced by customers’ decisions to invest capital toward initiating production in a new oil or natural gas well, improving production flows in an existing formation, or to address well control issues. This operating segment consists primarily of pressure pumping, downhole tools, coiled tubing, snubbing, nitrogen, well control, wireline and fishing. The services offered under Technical Services are high capital and personnel intensive businesses. The common drivers of operational and financial success of these services include diligent equipment maintenance, strong logistical processes, and appropriately trained personnel who function well in a team environment. The Company considers all of these service to be closely integrated oil and gas well servicing businesses, and makes resource allocation and performance assessment decisions based on this operating segment as a whole across these various services. The principal markets for this segment include the United States, including the Gulf of Mexico, the mid-continent, southwest, Rocky Mountain and Appalachian regions, and international locations including primarily Argentina, Canada, Gabon, China, Colombia and the Middle East. Customers include major multi-national and independent oil and gas producers, and selected nationally-owned oil companies.

Support Services include all of the services that provide (i) equipment for customers’ use on the well site without RPC personnel and (ii) services that are provided in support of customer operations off the well site such as classroom and computer training, and other consulting services. The primary drivers of operational success for equipment provided for customers’ use on the well site without RPC personnel are offering safe, high quality and in-demand equipment appropriate for the well design characteristics. The drivers of operational success for the other Support Services relate to meeting customer needs off the well site and competitive marketing of such services. The equipment and services offered include drill pipe and related tools, pipe handling, pipe inspection and storage services, and oilfield training and consulting services. The demand for these services tends to be influenced primarily by customer drilling-related activity levels. The equipment and services offered include drill pipe and related tools, pipe handling, inspection and storage services, and oilfield training services. The principal markets for this segment include the United States, including the Gulf of Mexico, the mid-continent and Appalachian regions, and selected international locations. Customers include domestic operations of major multi-national and independent oil and gas producers, and selected nationally-owned oil companies.

The Company’s Chief Operating Decision Maker (“CODM”) assesses performance and makes resource allocation decisions regarding, among others, staffing, growth and maintenance capital expenditures and key initiatives based on operating segments outlined above.

RPC evaluates the performance of its segments based on revenues, operating profits and return on invested capital. Gains or losses on disposition of assets are reviewed by the CODM on a consolidated basis, and accordingly the Company does not report gains or losses at the segment level. Inter-segment revenues are generally recorded in segment operating results at prices that management believes approximate prices for arm’s length transactions and are not material to operating results.

Summarized financial information with respect RPC’s reportable segments for the three months ended March 31, 2017 and 2016 are shown in the following table:

	Three months ended   March 31,
(in thousands)	2017			2016
Revenues:
Technical Services	$	286,198		$	175,472
Support Services		11,921			13,623
Total revenues	$	298,119		$	189,095
Operating income (loss):
Technical Services	$	9,205		$	(63,264	)
Support Services		(5,221	)		(6,636	)
Corporate		(3,927	)		(6,443	)
Gain on disposition of assets, net		1,517			1,256
Total operating income (loss)	$	1,574		$	(75,087	)
Interest expense		(103	)		(325	)
Interest income		129			23
Other income, net		212			342
Income (loss) before income taxes	$	1,812		$	(75,047	)

As of and for the three months ended March 31, 2017	Technical  Services		Support  Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	39,494	$	5,052	$	117	$	44,663
Capital expenditures		9,766		1,909		32		11,707
Identifiable assets	$	782,778	$	74,631	$	191,645	$	1,049,054

As of and three months ended March 31, 2016	Technical  Services		Support  Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	53,618	$	6,899	$	119	$	60,636
Capital expenditures		8,032		858		691		9,581
Identifiable assets	$	875,622	$	94,667	$	184,907	$	1,155,196

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INVENTORIES

3 Months Ended

Mar. 31, 2017

INVENTORIES

INVENTORIES

7. INVENTORIES

Inventories of $111,945,000 at March 31, 2017 and $108,316,000 at December 31, 2016 consist of raw materials, parts and supplies.

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EMPLOYEE BENEFIT PLAN

3 Months Ended

Mar. 31, 2017

EMPLOYEE BENEFIT PLAN

EMPLOYEE BENEFIT PLAN

8. EMPLOYEE BENEFIT PLAN

The following represents the net periodic benefit cost and related components of the Company’s multiple employers Retirement Income Plan:

	Three months ended March 31
(in thousands)	2017			2016
Interest cost	$	483		$	502
Expected return on plan assets		(589	)		(534	)
Amortization of net losses		213			200
Net periodic benefit cost	$	107		$	168

The Company did not contribute to this plan during the three months ended March 31, 2017 and contributed $900,000 during the three months ended March 31, 2016.

The Company permits selected highly compensated employees to defer a portion of their compensation into the non-qualified Supplemental Retirement Plan (“SERP”). The SERP assets are marked to market and totaled $19,313,000 as of March 31, 2017 and $18,367,000 as of December 31, 2016. The SERP assets are reported in non-current other assets on the consolidated balance sheets and changes in the fair value of these assets are reported in the consolidated statements of operations as compensation cost in selling, general and administrative expenses. Trading gains (losses) related to the SERP assets were approximately as follows:

	Three months ended  March 31
(in thousands)	2017		2016
Trading gains (losses), net	$	616	$	(327	)

The SERP liability includes participant deferrals net of distributions and is recorded on the consolidated balance sheets in long-term pension liabilities with any change in the fair value of the liabilities recorded as compensation cost within selling, general and administrative expenses in the consolidated statements of operations.

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NOTES PAYABLE TO BANKS

3 Months Ended

Mar. 31, 2017

NOTES PAYABLE TO BANKS

NOTES PAYABLE TO BANKS

9. NOTES PAYABLE TO BANKS

The Company has a revolving credit facility with Banc of America Securities, LLC, SunTrust Robinson Humphrey, Inc., and Regions Capital Markets as Joint Lead Arrangers and Joint Book Managers, and a syndicate of four other lenders. The facility has a general term of five years ending January 17, 2019 and provides for a line of credit of up to $125 million, including a $50 million letter of credit subfacility, and a $35 million swingline subfacility. The revolving credit facility contains customary terms and conditions, including restrictions on indebtedness, dividend payments, business combinations and other related items. The revolving credit facility includes a full and unconditional guarantee by the Company’s 100 percent owned domestic subsidiaries whose assets equal substantially all of the consolidated assets of the Company and its subsidiaries. Certain of the Company’s minor subsidiaries are not guarantors.

On June 30, 2016, the Company amended the revolving credit facility to (1) establish a borrowing base to be the lesser of (a) $125 million or (b) the difference between (i) a specified percentage (ranging from 70% to 80%) of eligible accounts receivable less (ii) the amount of any outstanding letters of credit, (2) secure payment obligations under the credit facility with a security interest in the consolidated accounts receivable, and (3) replace the financial covenants related to minimum leverage and debt service coverage ratios with a covenant to maintain a minimum tangible net worth of not less than $700 million. As of March 31, 2017, the Company was in compliance with this covenant.

Revolving loans under the amended revolving credit facility bear interest at one of the following two rates at the Company’s election:

● the Base Rate, which is a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 0.50%, (b) Bank of America’s publicly announced “prime rate,” and (c) the Eurodollar Rate plus 1.00%; in each case plus a margin that ranges from 0.125% to 1.125% based on a quarterly consolidated leverage ratio calculation; or

● the Eurodollar Rate, which is the rate per annum equal to the London Interbank Offering Rate (“LIBOR”); plus, a margin ranging from 1.125% to 2.125%, based upon a quarterly debt covenant calculation.

In addition, the Company pays an annual fee ranging from 0.225% to 0.325%, based on a quarterly consolidated leverage ratio calculation, on the unused portion of the credit facility.

The Company has incurred loan origination fees and other debt related costs associated with the revolving credit facility in the aggregate of approximately $3.0 million. These costs, net of amounts written off as a result of a reduction in the size of the revolving credit facility in 2015, are being amortized to interest expense over the remaining term of the five-year loan, and the remaining net balance of $0.2 million at March 31, 2017 is classified as part of non-current other assets.

On January 4, 2016, the Company entered into a separate one year $35 million uncommitted letter of credit facility with Bank of America, N.A. Under the terms of the letter of credit facility, the Company paid 0.75% per annum on outstanding letters of credit. This letter of credit facility expired on January 3, 2017. All letters of credit are currently issued under RPC’s $125 million credit facility. Letters of credit outstanding totaled $19.1 million as of December 31, 2017 and 2016.

As of March 31, 2017, RPC had no outstanding borrowings under the revolving credit facility. Interest incurred, which includes facility fees on the unused portion of the revolving credit facility and the amortization of loan costs, was as follows:

	Three months ended  March 31
	2017		2016
(in thousands)
Interest incurred	$	103	$	109

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INCOME TAXES

3 Months Ended

Mar. 31, 2017

INCOME TAXES

INCOME TAXES

10. INCOME TAXES

The Company determines its periodic income tax benefit or expense based upon the current period income and the annual estimated tax rate for the Company adjusted for any change to prior period estimates. The estimated tax rate is revised, if necessary, as of the end of each successive interim period during the fiscal year to the Company’s current annual estimated tax rate.

For the three months ended March 31, 2017, the effective rate reflects an income tax benefit of 100.6 percent compared to an income tax benefit of 56.7 percent for the comparable period in the prior year. The Company adopted the provisions of ASU 2016-09 in the first quarter of 2017 that requires excess tax benefits and deficiencies to be recognized as a component of income tax expense rather than stockholders’ equity. This resulted in a beneficial discrete adjustment of $2.5 million to the provision for income taxes in the first quarter of 2017. The 2016 beneficial rate was the result of operational losses and the one-time beneficial impact of a resolution of a tax matter with a state taxing authority, offset by the detrimental effect of non-deductible permanent items.

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FAIR VALUE DISCLOSURES

3 Months Ended

Mar. 31, 2017

FAIR VALUE DISCLOSURES

FAIR VALUE DISCLOSURES

11. FAIR VALUE DISCLOSURES

The various inputs used to measure assets at fair value establish a hierarchy that distinguishes between assumptions based on market data (observable inputs) and the Company’s assumptions (unobservable inputs). The hierarchy consists of three broad levels as follows:

1. Level 1 – Quoted market prices in active markets for identical assets or liabilities.

2. Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

3. Level 3 – Unobservable inputs developed using the Company’s estimates and assumptions, which reflect those that market participants would use.

The following table summarizes the valuation of financial instruments measured at fair value on a recurring basis in the balance sheets as of March 31, 2017 and December 31, 2016:

			Fair Value Measurements at March 31, 2017  with:
(in thousands)	Total		Quoted prices  in active  markets for identical  assets		Significant  other  observable  inputs		Significant unobservable  inputs
			(Level 1)		(Level 2)		(Level 3)
Assets:
Available-for-sale securities – equity securities	$	240	$	240	$	—	$	—
Investments measured at net asset value - trading securities	$	19,313

			Fair Value Measurements at December 31,  2016 with:
(in thousands)	Total		Quoted prices  in active  markets for identical  assets		Significant  other  observable  inputs		Significant unobservable  inputs
			(Level 1)		(Level 2)		(Level 3)
Assets:
Available-for-sale securities – equity securities	$	264	$	264	$	—	$	—
Investments measured at net asset value - trading securities	$	18,367

The Company determines the fair value of marketable securities classified as available-for-sale through quoted market prices. The total fair value is the final closing price, as defined by the exchange in which the asset is actively traded, on the last trading day of the period, multiplied by the number of units held without consideration of transaction costs. Marketable securities classified as trading are comprised of the SERP assets, as described in Note 8, and are recorded primarily at their net cash surrender values, calculated using their net asset values, which approximates fair value, as provided by the issuing insurance company. Significant observable inputs, in addition to quoted market prices, were used to value the trading securities. The Company’s policy is to recognize transfers between levels at the beginning of quarterly reporting periods. For the period ended March 31, 2017, there were no significant transfers in or out of levels 1, 2 or 3.

Under the Company’s revolving credit facility, there was no balance outstanding at March 31, 2017 and December 31, 2016. Outstanding balances based on the quote from the lender (level 2 inputs) is similar to the fair value at the same date. The borrowings under our revolving credit facility bear variable interest rates as described in Note 9. The Company is subject to interest rate risk on the variable component of the interest rate.

The carrying amounts of other financial instruments reported in the balance sheet for current assets and current liabilities approximate their fair values because of the short maturity of these instruments. The Company currently does not use the fair value option to measure any of its existing financial instruments and has not determined whether it will elect this option for financial instruments acquired in the future.

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ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

3 Months Ended

Mar. 31, 2017

ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

12. ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

Accumulated other comprehensive (loss) income consists of the following (in thousands):

	Pension   Adjustment			Unrealized   Gain (Loss) On Securities			Foreign Currency Translation			Total
Balance at December 31, 2016	$	(15,503	)	$	39		$	(2,638	)	$	(18,102	)
Change during the period:
Before-tax amount		-			(24	)		42			18
Tax benefit		-			9			-			9
Reclassification adjustment, net of taxes:
Amortization of net loss (1)		135			-			-			135
Total activity for the period		135			(15	)		42			162
Balance at March 31, 2017	$	(15,368	)	$	24		$	(2,596	)	$	(17,940	)

(1) Reported as part of selling, general and administrative expenses.

	Pension   Adjustment			Unrealized   Gain (Loss) On Securities			Foreign  Currency Translation			Total
Balance at December 31, 2015	$	(14,715	)	$	36		$	(3,290	)	$	(17,969	)
Change during the period:
Before-tax amount		-			(14	)		692			678
Tax benefit		-			5			-			5
Reclassification adjustment, net of taxes:
Amortization of net loss (1)		127			-			-			127
Total activity for the period		127			(9	)		692			810
Balance at March 31, 2016	$	(14,588	)	$	27		$	(2,598	)	$	(17,159	)

(1) Reported as part of selling, general and administrative expenses.

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ACCOUNTING POLICIES (Policies)

3 Months Ended

Mar. 31, 2017

Accounting Policies [Abstract]

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

The Financial Accounting Standards Board (FASB) issued the following applicable Accounting Standards Updates (ASU):

Recently Adopted Accounting Pronouncements:

Accounting Standards Update (ASU) No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. Current requirements are to measure inventory at the lower of cost or market. Market could be replacement cost, net realizable value, or net realizable value less an approximated normal profit margin. These amendments allow inventory to be measured at lower of cost or net realizable value and eliminates the market requirement. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. The adoption of these provisions did not have a material impact on the Company’s consolidated financial statements.

ASU No. 2016-07, Investments — Equity Method and Joint Ventures (Topic 323) Simplifying the Transition to the Equity Method of Accounting. The amendments eliminate the requirement to adjust the investment, results of operations, and retained earnings retroactively when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence. The cost of acquiring the additional interest in the investee is to be added to the current basis of the investor’s previously held interest and the equity method is to be adopted as of the date the investment qualifies. In addition, an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting is required to recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. The adoption of these provisions did not have a material impact on the Company’s consolidated financial statements.

ASU No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments simplify several aspects of the accounting for share-based payment award transactions, requiring excess tax benefits and deficiencies to be recognized as a component of income tax expense rather than equity. This guidance also requires excess tax benefits and deficiencies to be presented as an operating activity on the statement of cash flows and allows an entity to make an accounting policy election either to estimate expected forfeitures or to account for them as they occur. The Company will continue to estimate expected forfeitures. The Company adopted these provisions in the first quarter of 2017 on a prospective basis. See Notes 5 and 10 on Stock Based Compensation and Income Taxes, respectively, for the effect of adoption on the financial statements.

ASU No. 2016-17, Consolidation (Topic 810): Interests Held through Related Parties That are under Common Control. The amendments affect reporting entities that are required to evaluate whether they should consolidate a variable interest entity in certain situations involving entities under common control. Specifically, the amendments change the evaluation of whether a reporting entity is the primary beneficiary of a variable interest entity by changing how a reporting entity that is a single decision maker of a variable interest entity treats indirect interests in the entity held through related parties that are under common control with the reporting entity. The Company adopted these provisions in the first quarter of 2017 and the adoption did not have a material impact on its consolidated financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted:

To be adopted in 2018:

REVENUE RECOGNITION:

The Financial Accounting Standards Board and International Accounting Standards Board issued their converged standard on revenue recognition in May 2014. The standard provides a comprehensive, industry-neutral revenue recognition model intended to increase financial statement comparability across companies and industries and significantly reduce the complexity inherent in today’s revenue recognition guidance. The various ASUs related to Revenue from Contracts with Customers (Topic 606) have been listed below: 

● ASU No. 2014-09. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services using a five step process.

● ASU No. 2015-14 deferred the effective date of ASU 2014-09 for all entities by one year to the first quarter of 2018 with early application permitted.

● ASU No. 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net). The amendments provide guidance on whether an entity is a principal or agent when providing services to a customer along with another party.

● ASU No. 2016-10, Identifying Performance Obligations and Licensing. The amendments clarify the earlier guidance on identifying performance obligations and licensing implementation.

● ASU No. 2016-11, Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting. This ASU rescinds certain SEC guidance related to issues that are currently codified under various topics.

● ASU No. 2016-12, Narrow - Scope Improvements and Practical Expedients. The amendments provide clarifying guidance on certain aspects of the five step process and practical expedients regarding the effect of modifications and status of completed contracts under legacy GAAP and disclosures related to the application of this guidance using the modified retrospective or retrospective transition method.

● ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers. The amendments in ASU 2016-20 affect narrow aspects of the guidance issued in ASU 2014-09 and includes among others, loan guarantees, impairment testing of contract costs, performance obligations disclosures and accrual of advertising costs.

Current status of implementation:

The Company is currently analyzing the effect of the standard across all of its revenue streams to evaluate the impact of the new standard on revenue contracts. This includes reviewing current accounting policies and practices to identify potential differences that would result from applying the requirements under the new standard. Most of the Company’s services are primarily short-term in nature, and the assessment at this stage is that the Company does not expect the adoption of the new revenue recognition standard to have a material impact on its financial statements. The Company plans to adopt the standard in the first quarter of 2018 using the modified retrospective method by recognizing the cumulative effect of initially applying the new standard as an adjustment to the opening balance of retained earnings.

ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The amendments make targeted improvements to existing U.S. GAAP and affects accounting for equity investments and financial instruments and liabilities and related disclosures. The amendments are effective starting in the first quarter of 2018, with early adoption permitted for certain provisions. The Company is currently evaluating the impact of these provisions on its consolidated financial statements.

ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The amendments provide guidance in the presentation and classification of certain cash receipts and cash payments in the statement of cash flows including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, and distributions received from equity method investees. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. The amendments require an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments eliminate the exception for an intra-entity transfer of an asset other than inventory. Two common examples of assets included in the scope of the amendments are intellectual property and property, plant, and equipment. The amendments do not include new disclosure requirements; however, existing disclosure requirements might be applicable when accounting for the current and deferred income taxes for an intra-entity transfer of an asset other than inventory. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments are required to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-18, Statement of Cash Flows (230): Restricted Cash. The amendments require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. As a result, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments do not provide a definition of restricted cash or restricted cash equivalents. The amendments are effective starting in the first quarter of 2018 with early adoption permitted. The amendments should be applied using a retrospective transition method to each period presented. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business: The amendments are intended to help companies and other organizations evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The amendments provide a more robust framework to use in determining when a set of assets and activities is a business. They also provide more consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable. The amendments are effective beginning in the first quarter of 2018 with early application permitted under certain circumstances. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. To simplify the subsequent measurement of goodwill, the amendments eliminate Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments are effective for annual or any interim goodwill impairment tests beginning in 2020 applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

To be adopted in 2019 and later:

ASU No. 2016-02, Leases (Topic 842). Under the new guidance, lessees will need to recognize a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease), at the commencement of the lease term. The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. The amendments in this standard are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Lessees and lessors may not apply a full retrospective transition approach. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The amendments require the credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration should presented as an allowance rather than a write-down. It also allows recording of credit loss reversals in current period net income. The amendments are effective starting in the first quarter of 2020 with early application permitted a year earlier. The Company is currently evaluating the impact of adopting these provisions on its consolidated financial statements.

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EARNINGS (LOSS) PER SHARE (Tables)

3 Months Ended

Mar. 31, 2017

EARNINGS (LOSS) PER SHARE

Schedule of reconciliation of weighted average shares outstanding

	Three months ended  March 31,
(In thousands)	2017			2016
Net income (loss) available for stockholders:	$	3,634		$	(32,511	)
Less:  Adjustments for earnings attributable to participating securities		(51	)		-
Net income (loss) used in calculating losses per share	$	3,583		$	(32,511	)
Weighted average shares outstanding (including participating securities)		217,713			217,433
Adjustment for participating securities		(3,042	)		(3,322	)
Shares used in calculating basic and diluted earnings (loss) per share		214,671			214,111

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STOCK-BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2017

STOCK-BASED COMPENSATION

Schedule of stock-based employee compensation expense

	Three months ended
	March 31,
(in thousands)	2017		2016
Pre-tax expense	$	2,687	$	2,660
After tax expense	$	1,706	$	1,689

Schedule of summary of changes in non-vested restricted shares

	Shares			Weighted Average  Grant-Date Fair  Value
Non-vested shares at December 31, 2016		3,217,075		$	12.91
Granted		563,065			21.66
Vested		(800,225	)		13.22
Forfeited		(13,500	)		13.50
Non-vested shares at March 31, 2017		2,966,415		$	14.49

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BUSINESS SEGMENT INFORMATION (Tables)

3 Months Ended

Mar. 31, 2017

BUSINESS SEGMENT INFORMATION

Schedule of segment reporting information by segment

	Three months ended   March 31,
(in thousands)	2017			2016
Revenues:
Technical Services	$	286,198		$	175,472
Support Services		11,921			13,623
Total revenues	$	298,119		$	189,095
Operating income (loss):
Technical Services	$	9,205		$	(63,264	)
Support Services		(5,221	)		(6,636	)
Corporate		(3,927	)		(6,443	)
Gain on disposition of assets, net		1,517			1,256
Total operating income (loss)	$	1,574		$	(75,087	)
Interest expense		(103	)		(325	)
Interest income		129			23
Other income, net		212			342
Income (loss) before income taxes	$	1,812		$	(75,047	)

As of and for the three months ended March 31, 2017	Technical  Services		Support  Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	39,494	$	5,052	$	117	$	44,663
Capital expenditures		9,766		1,909		32		11,707
Identifiable assets	$	782,778	$	74,631	$	191,645	$	1,049,054

As of and three months ended March 31, 2016	Technical  Services		Support  Services		Corporate		Total
(in thousands)
Depreciation and amortization	$	53,618	$	6,899	$	119	$	60,636
Capital expenditures		8,032		858		691		9,581
Identifiable assets	$	875,622	$	94,667	$	184,907	$	1,155,196

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EMPLOYEE BENEFIT PLAN (Tables)

3 Months Ended

Mar. 31, 2017

EMPLOYEE BENEFIT PLAN

Schedule of net periodic benefit cost and related components

	Three months ended March 31
(in thousands)	2017			2016
Interest cost	$	483		$	502
Expected return on plan assets		(589	)		(534	)
Amortization of net losses		213			200
Net periodic benefit cost	$	107		$	168

Schedule of trading gains (losses) related to SERP assets

	Three months ended  March 31
(in thousands)	2017		2016
Trading gains (losses), net	$	616	$	(327	)

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NOTES PAYABLE TO BANKS (Tables)

3 Months Ended

Mar. 31, 2017

NOTES PAYABLE TO BANKS

Schedule of interest incurred on the credit facility, interest capitalized related to facilities and equipment under construction and the related weighted average interest rates

	Three months ended  March 31
	2017		2016
(in thousands)
Interest incurred	$	103	$	109

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FAIR VALUE DISCLOSURES (Tables)

3 Months Ended

Mar. 31, 2017

FAIR VALUE DISCLOSURES

Schedule of valuation of financial instruments measured at fair value on a recurring basis

			Fair Value Measurements at March 31, 2017  with:
(in thousands)	Total		Quoted prices  in active  markets for identical  assets		Significant  other  observable  inputs		Significant unobservable  inputs
			(Level 1)		(Level 2)		(Level 3)
Assets:
Available-for-sale securities – equity securities	$	240	$	240	$	—	$	—
Investments measured at net asset value - trading securities	$	19,313

			Fair Value Measurements at December 31,  2016 with:
(in thousands)	Total		Quoted prices  in active  markets for identical  assets		Significant  other  observable  inputs		Significant unobservable  inputs
			(Level 1)		(Level 2)		(Level 3)
Assets:
Available-for-sale securities – equity securities	$	264	$	264	$	—	$	—
Investments measured at net asset value - trading securities	$	18,367

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ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME (Tables)

3 Months Ended

Mar. 31, 2017

ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME

Schedule of accumulated other comprehensive (loss) income

	Pension   Adjustment			Unrealized   Gain (Loss) On Securities			Foreign Currency Translation			Total
Balance at December 31, 2016	$	(15,503	)	$	39		$	(2,638	)	$	(18,102	)
Change during the period:
Before-tax amount		-			(24	)		42			18
Tax benefit		-			9			-			9
Reclassification adjustment, net of taxes:
Amortization of net loss (1)		135			-			-			135
Total activity for the period		135			(15	)		42			162
Balance at March 31, 2017	$	(15,368	)	$	24		$	(2,596	)	$	(17,940	)

(1) Reported as part of selling, general and administrative expenses.

	Pension   Adjustment			Unrealized   Gain (Loss) On Securities			Foreign  Currency Translation			Total
Balance at December 31, 2015	$	(14,715	)	$	36		$	(3,290	)	$	(17,969	)
Change during the period:
Before-tax amount		-			(14	)		692			678
Tax benefit		-			5			-			5
Reclassification adjustment, net of taxes:
Amortization of net loss (1)		127			-			-			127
Total activity for the period		127			(9	)		692			810
Balance at March 31, 2016	$	(14,588	)	$	27		$	(2,598	)	$	(17,159	)

(1) Reported as part of selling, general and administrative expenses.

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EARNINGS (LOSS) PER SHARE - Reconciliation of weighted average shares outstanding (Details) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
EARNINGS (LOSS) PER SHARE
Net income (loss) available for stockholders:	$ 3,634	$ (32,511)
Less: Adjustments for earnings attributable to participating securities	(51)
Net income (loss) used in calculating losses per share	$ 3,583	$ (32,511)
Weighted average shares outstanding (including participating securities)	217,713	217,433
Adjustment for participating securities	(3,042)	(3,322)
Shares used in calculating basic and diluted earnings (loss) per share	214,671	214,111

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STOCK-BASED COMPENSATION - Stock-based employee compensation expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
STOCK-BASED COMPENSATION
Pre-tax expense	$ 2,687	$ 2,660
After tax expense	$ 1,706	$ 1,689

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STOCK-BASED COMPENSATION - Non-vested restricted shares activity (Details 1) - Restricted Stock	3 Months Ended
	Mar. 31, 2017 $ / shares shares
Shares
Non-vested shares at December 31, 2016 | shares	3,217,075
Granted | shares	563,065
Vested | shares	(800,225)
Forfeited | shares	(13,500)
Non-vested shares at March 31, 2017 | shares	2,966,415
Weighted Average Grant-Date Fair Value
Non-vested shares at December 31, 2016 | $ / shares	$ 12.91
Granted | $ / shares	21.66
Vested | $ / shares	13.22
Forfeited | $ / shares	13.50
Non-vested shares at March 31, 2017 | $ / shares	$ 14.49

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STOCK-BASED COMPENSATION (Detail Textuals) - 2014 Stock Incentive Plan - shares	1 Months Ended
	Apr. 30, 2014	Mar. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Reserved shares of common stock	8,000,000
Term of reserved shares	10 years
Shares available for grant		5,696,000

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STOCK-BASED COMPENSATION (Detail Textuals 1) - Restricted Stock - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total fair value of shares vested	$ 17,527,000	$ 9,527,000
Tax benefits for compensation expense for restricted stock	2,536,000	$ 403,000
Unrecognized compensation cost related to non-vested restricted shares	$ 48,182,000
Unrecognized compensation cost related to non-vested restricted shares recognized period	4.0 years

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BUSINESS SEGMENT INFORMATION - Summary of information with respect to RPC's business segments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Revenues:
Total revenues	$ 298,119	$ 189,095
Operating (loss) profit:
Total operating income (loss)	1,574	(75,087)
Interest expense	(103)	(325)
Interest income	129	23
Other income, net	212	342
Income (loss) before income taxes	1,812	(75,047)
Depreciation and amortization	44,663	60,636
Capital expenditures	11,707	9,581
Identifiable assets	1,049,054		$ 1,035,452
Operating Segments
Revenues:
Total revenues	298,119	189,095
Operating (loss) profit:
Total operating income (loss)	1,574	(75,087)
Interest expense	(103)	(325)
Interest income	129	23
Other income, net	212	342
Income (loss) before income taxes	1,812	(75,047)
Depreciation and amortization	44,663	60,636
Capital expenditures	11,707	9,581
Identifiable assets	1,049,054	1,155,196
Operating Segments | Technical Services
Revenues:
Total revenues	286,198	175,472
Operating (loss) profit:
Total operating income (loss)	9,205	(63,264)
Depreciation and amortization	39,494	53,618
Capital expenditures	9,766	8,032
Identifiable assets	782,778	875,622
Operating Segments | Support Services
Revenues:
Total revenues	11,921	13,623
Operating (loss) profit:
Total operating income (loss)	(5,221)	(6,636)
Depreciation and amortization	5,052	6,899
Capital expenditures	1,909	858
Identifiable assets	74,631	94,667
Corporate
Operating (loss) profit:
Total operating income (loss)	(3,927)	(6,443)
Depreciation and amortization	117	119
Capital expenditures	32	691
Identifiable assets	191,645	184,907
Gain on disposition of assets, net
Operating (loss) profit:
Total operating income (loss)	$ 1,517	$ 1,256

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INVENTORIES (Detail Textuals) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
INVENTORIES
Raw materials, parts and supplies of inventories	$ 111,945	$ 108,316

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EMPLOYEE BENEFIT PLAN - Net periodic benefit cost and related components (Details) - Multiple Employers Retirement Income Plan - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Defined Benefit Plan Disclosure [Line Items]
Interest cost	$ 483	$ 502
Expected return on plan assets	(589)	(534)
Amortization of net losses	213	200
Net periodic benefit cost	$ 107	$ 168

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EMPLOYEE BENEFIT PLAN - Trading results related to SERP (Details 1) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Non-qualified Supplemental Retirement Plan ("SERP")
Defined Benefit Plan Disclosure [Line Items]
Trading gains (losses), net	$ 616	$ (327)

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EMPLOYEE BENEFIT PLAN (Detail Textuals) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2017	Dec. 31, 2016
Multiple Employers Retirement Income Plan
Defined Benefit Plan Disclosure [Line Items]
Contribution by employer for retirement income plan	$ 900,000
Non-qualified Supplemental Retirement Plan ("SERP")
Defined Benefit Plan Disclosure [Line Items]
SERP assets		$ 19,313,000	$ 18,367,000

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NOTES PAYABLE TO BANKS - Interest incurred on credit facility, interest capitalized related to facilities and equipment under construction, and related weighted average interest rates (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Revolving credit facility
Line of Credit Facility [Line Items]
Interest incurred	$ 103	$ 109

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NOTES PAYABLE TO BANKS (Detail Textuals)
$ in Millions

3 Months Ended

Mar. 31, 2017

USD ($)

Revolving credit facility

Line of Credit Facility [Line Items]

Amount of credit facility

$ 125.0

Percentage of ownership

100.00%

Term of line of credit facility

5 years

Loan origination fees and other debt related costs

$ 3.0

Non-current other assets net

$ 0.2

Description of variable rate basis of debt instrument

Revolving loans under the amended revolving credit facility bear interest at one of the following two rates at the Company’s election:

● the Base Rate, which is a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 0.50%, (b) Bank of America’s publicly announced “prime rate,” and (c) the Eurodollar Rate plus 1.00%; in each case plus a margin that ranges from 0.125% to 1.125% based on a quarterly consolidated leverage ratio calculation; or

● the Eurodollar Rate, which is the rate per annum equal to the London Interbank Offering Rate (“LIBOR”); plus, a margin ranging from 1.125% to 2.125%, based upon a quarterly debt covenant calculation.

Borrowing base of line of credit

$ 125.0

Borrowing capacity description

Company amended the revolving credit facility to (1) establish a borrowing base to be the lesser of (a) $125 million or (b) the difference between (i) a specified percentage (ranging from 70% to 80%) of eligible accounts receivable less (ii) the amount of any outstanding letters of credit, (2) secure payment obligations under the credit facility with a security interest in the consolidated accounts receivable, and (3) replace the financial covenants related to minimum leverage and debt service coverage ratios with a covenant to maintain a minimum tangible net worth of not less than $700 million. 

Minimum tangible net worth

$ 700.0

Revolving credit facility | Minimum

Line of Credit Facility [Line Items]

Fees on unused portion of facility

0.225%

Account receivable percentage for line of credit determination

70.00%

Revolving credit facility | Maximum

Line of Credit Facility [Line Items]

Fees on unused portion of facility

0.325%

Account receivable percentage for line of credit determination

80.00%

Revolving credit facility | Option 1 A

Line of Credit Facility [Line Items]

Basis spread on variable rate

0.50%

Description of reference rate basis

Federal Funds Rate

Revolving credit facility | Option 1 A | Minimum

Line of Credit Facility [Line Items]

Basis spread on variable rate

0.125%

Revolving credit facility | Option 1 A | Maximum

Line of Credit Facility [Line Items]

Basis spread on variable rate

1.125%

Revolving credit facility | Option 1 B

Line of Credit Facility [Line Items]

Description of reference rate basis

Prime rate

Revolving credit facility | Option 1 C

Line of Credit Facility [Line Items]

Basis spread on variable rate

1.00%

Description of reference rate basis

Eurodollar Rate

Letter of credit subfacility

Line of Credit Facility [Line Items]

Amount of credit facility

$ 50.0

Swingline subfacility

Line of Credit Facility [Line Items]

Amount of credit facility

$ 35.0

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NOTES PAYABLE TO BANKS (Detail Textuals 1) - Revolving credit facility - Option 2 - Eurodollar Borrowings	3 Months Ended
	Mar. 31, 2017
Line of Credit Facility [Line Items]
Description of reference rate basis	London Interbank Offering Rate ("LIBOR")
Minimum
Line of Credit Facility [Line Items]
Range of margin based on quarterly debt covenant calculation	1.125%
Maximum
Line of Credit Facility [Line Items]
Range of margin based on quarterly debt covenant calculation	2.125%

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NOTES PAYABLE TO BANKS (Detail Textuals 2) - Uncommitted letter of credit facility - USD ($) $ in Millions	Jan. 04, 2016	Mar. 31, 2017	Dec. 31, 2016
Line Of Credit Facility [Line Items]
Amount of credit facility	$ 35.0
Term of letter of credit facility	1 year
Commitment fee percentage, per annum on outstanding letters of credit	0.75%
Available borrowing under the facility	$ 125.0
Letters of credit outstanding amount		$ 19.1	$ 19.1

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INCOME TAXES (Detail Textuals) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
INCOME TAXES
Effective tax rate	100.60%	56.70%
Discrete income tax benefit for adjustment in the provision for income taxes	$ 2.5

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FAIR VALUE DISCLOSURES - Valuation of financial instruments measured at fair value on a recurring basis (Details) - Fair value on a recurring basis - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Assets:
Available-for-sale securities - equity securities	$ 240	$ 264
Investments measured at net asset value - trading securities	19,313	18,367
Quoted prices in active markets for identical assets (Level 1)
Assets:
Available-for-sale securities - equity securities	240	264
Significant other observable inputs (Level 2)
Assets:
Available-for-sale securities - equity securities
Significant unobservable inputs (Level 3)
Assets:
Available-for-sale securities - equity securities

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FAIR VALUE DISCLOSURES (Detail Textuals) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Revolving credit facility
Line of Credit Facility [Line Items]
Outstanding borrowings under the facility	$ 0	$ 0

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ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME - Summary of components of accumulated other comprehensive (loss) income (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2017	Mar. 31, 2016
Accumulated Other Comprehensive Income Loss [Roll Forward]
Balance		$ (18,102)	$ (17,969)
Change during the period:
Before-tax amount		18	678
Tax benefit		9	5
Reclassification adjustment, net of taxes:
Amortization of net loss	[1]	135	127
Total activity for the period		162	810
Balance		(17,940)	(17,159)
Pension Adjustment
Accumulated Other Comprehensive Income Loss [Roll Forward]
Balance		(15,503)	(14,715)
Change during the period:
Before-tax amount
Tax benefit
Reclassification adjustment, net of taxes:
Amortization of net loss	[1]	135	127
Total activity for the period		135	127
Balance		(15,368)	(14,588)
Unrealized Gain (Loss) On Securities
Accumulated Other Comprehensive Income Loss [Roll Forward]
Balance		39	36
Change during the period:
Before-tax amount		(24)	(14)
Tax benefit		9	5
Reclassification adjustment, net of taxes:
Amortization of net loss
Total activity for the period		(15)	(9)
Balance		24	27
Foreign Currency Translation
Accumulated Other Comprehensive Income Loss [Roll Forward]
Balance		(2,638)	(3,290)
Change during the period:
Before-tax amount		42	692
Tax benefit
Reclassification adjustment, net of taxes:
Amortization of net loss
Total activity for the period		42	692
Balance		$ (2,596)	$ (2,598)

[1] Reported as part of selling, general and administrative expenses.