parker drilling company dpa

7/28/2019 Parker Drilling Company DPA

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IN THE UNITED STATES DISTRICT COURT FOR THEEASTERN DISTR ICT OF V IRGINIA

Alexand r ia D iv is i on

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: . .. . . . - '

UNITED STATES OF AMERICAv .

PARKER DRILLING COMPANY,Defendant .

Criminal Case No. 1:13CR 1%,

DEFERRED PROSECUTION AGREEMENTDefendant ParkerDrillingCompany (the "Company"), by its undersigned

representatives, pursuant to authority granted by the Company's Board of Directors, and theUnited States Department of Justice, Criminal Division, Fraud Section, and the United StatesAttorney's Office for the Eastern District ofVirginia (collectively, the 'Department"), enter intothis deferred prosecution agreement (the "Agreement"). The terms and conditions of thisAgreement are as follows:

Criminal In format ion and Acceptance of Responsibility1. The Company acknowledges and agrees that the Department will file in the

United States District Court for the Eastern District ofVirginia the attached one-count criminalInformation, charging the Company with knowingly and willfully violating the anti-briberyprovisions of the Foreign Corrupt Practices Act, Title 15, United States Code, Section 78dd-l(a).In sodoing, theCompany: (a) knowingly waives its rightto indictment on this charge, as well asall rights to a speedy trial pursuant to the Sixth Amendment to the United States Constitution.Title 18, United States Code, Section 3161, and Federal Rule of Criminal Procedure 48(b); and

Case 1:13-cr-00176-GBL Document 2 Filed 04/16/13 Page 1 of 18 PageID# 16


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(b) knowingly waives for purposesof thisAgreement and any chargesby theUnited Statesarising outof the conduct described inthe attached Statement of Facts anyobjection with respectto venue andconsents to the filing of the Information, as provided under the termsof thisAgreement, in the United StatesDistrictCourtforthe EasternDistrictof Virginia.

2. TheCompany admits, accepts, andacknowledges that it is responsible underUnited States lawfor theactsof itsofficers, directors, employees, and agents as charged intheInformation, and as set forth in the Statement of Facts attached hereto as Attachment A andincorporated by reference into thisAgreement, and thatthe allegations described intheInformation and the facts described in Attachment A are true and accurate. Should theDepartment pursue the prosecution thatisdeferred bythisAgreement, theCompany agrees thatitwill neither contest the admissibility ofnorcontradict theStatement of Facts in any suchproceeding, including without limitation any trial, guilty plea, or sentencing proceeding. Neitherthis Agreement nor the criminal Informationis a final adjudicationof the matters addressed insuch documents.

Term o f t he Ag re emen t3. ThisAgreement is effective fora period beginning on the dateonwhich the

Information is filed and ending three (3)years and seven (7)calendar days from that date (the"Term"). However, theCompany agrees that, in theeventthat theDepartment determines, in itssole discretion, thattheCompany has knowingly violated anyprovision of thisAgreement, anextension orextensions ofthe term of the Agreement may be imposed by the Department, initssole discretion, for uptoa total additional time period of one year, without prejudice totheDepartment's right to proceed as provided in Paragraphs 14 through 17below. Any extension ofthe Agreement extends all terms ofthisAgreement, including the terms of the reporting

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requirement inAttachment D,foran equivalent period. Conversely, intheevent theDepartmentfinds, in its solediscretion, that thereexistsa change in circumstances sufficientto eliminate theneedforthe reporting requirement inAttachment D,andthat theotherprovisions of thisAgreement have been satisfied, theTerm oftheAgreement maybe terminated early.

Relevant Considerat ions4. The Department enters into this Agreement based on the individual facts and

circumstances presented by thiscaseandtheCompany. Among the factsconsidered werethefollowing: (a) theCompany's cooperation, including conducting an extensive internalinvestigation andcollecting, analyzing, andorganizing voluminous evidenceand information fortheDepartment; (b)theCompany hasengaged inextensive remediation, including ending itsbusiness relationships with officers, employees, or agents primarily responsible for the corruptpayments, enhancing its due diligence protocol for third-party agents andconsultants, increasingtraining and testing requirements, and instituting heightened review of proposals and othertransactional documents forall theCompany'scontracts; (c) the Company has retained a full-timeChief ComplianceOfficerand Counselwho reports to the Chief ExecutiveOfficer andAudit Committee, aswell as staffto assist theChiefCompliance Officer andCounsel; (d)theCompany has already significantly enhanced and is committed to continue to enhance itscompliance program and internal controls, including ensuring thatitscompliance programsatisfies theminimum elements set forth inAttachment CtothisAgreement; (e) the Companyhas implemented a compliance-awareness improvement initiative andprogram that includesissuance of periodic anti-bribery compliance alerts; (f)theCompany has already implementedmany ofthe elements described below inparagraphs 8 and 9 and inAttachment C;and(g) theCompany has agreed tocontinue to cooperate with theDepartment inanyongoing investigation

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ofthe conduct ofthe Company and its officers, directors, employees, agents, and consultantsrelating to violations ofthe FCPA as provided inParagraph 5 below.

5. The Company shall continue to cooperate fully with theDepartment in any andallmatters relating to corrupt payments and any related false books and records and inadequateinternal controls, subject to applicable law and regulations. Attherequest oftheDepartment, theCompany shall also cooperate fully with other domestic or foreign law enforcement authoritiesandagencies, aswellas theMultilateral Development Banks ("MDBs"), inany investigation ofthe Company, its parentcompanyor its affiliates,or any of its present and former officers,directors, employees, agents, andconsultants, or anyotherparty, inany andallmatters relatingto corrupt payments. The Company agrees that its cooperation shall include, but is not limitedto, the following:

a. The Company shall truthfully disclose all factual information notprotected by a valid claim of attorney-client privilege or work product doctrine with respect to itsactivities, those of its parent company and affiliates, and those of its present and former directors,officers, employees, agents, and consultants concerning all matters relating to corrupt paymentsabout which the Company has any knowledge or about which the Department may inquire. Thisobligation of truthful disclosure includes the obligation of the Company to provide to theDepartment, upon request, any document, record or other tangible evidence relating to suchcorrupt payments about which the Department may inquire of the Company.

b. Upon request of the Department, with respect to any issue relevant to itsinvestigation of corrupt payments in connection with the operations of the Company and relatedbooks and records of the Company, or any of its present or former subsidiaries or affiliates, theCompany shall designate knowledgeable employees, agents or attorneys to provide to the

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Department the information andmaterials described in Paragraph 5(a)above on behalfof theCompany. Itis further understood thattheCompany must atall times provide complete, truthful,and accurate information.

c. With respectto any issuerelevant to theDepartment's investigation ofcorrupt payments, related false books and records, and inadequate controls in connection withthe operationsof the Company or any of its present or former subsidiaries or affiliates, theCompany shall use its best efforts to make available for interviewsor testimony, as requestedbythe Department, present or former officers, directors, employees, agents and consultants of theCompany. This obligation includes, but is not limited to, sworn testimony before a federal grandjury or in federal trials, as well as interviews with federal law enforcement and regulatoryauthorities. Cooperation under this Paragraph shall include identification ofwitnesses who, tothe knowledge of the Company, may have material information regarding the matters underinvestigation.

d. With respect to any information, testimony, documents, records or othertangible evidence provided to the Department pursuant to this Agreement, the Company consentsto any and all disclosures, subject to applicable law and regulations, to other governmentalauthorities, including United States authorities and those of a foreign government, and theMDBs, of such materials as the Department, in its sole discretion, shall deem appropriate.

Payment o fMonetary Penal ty6. The Department and the Company agree that application of the United States

SentencingGuidelines ("USSG" or "Sentencing Guidelines") to determine the applicable finerange yields the following analysis:



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a. The 2012 USSGare applicable to this matter.b. OffenseLevel. Based uponUSSG 2C1.1,the totaloffense levelis 30,calculated as follows:

(a)(2) Base Offense Level 12(b)(2) Value of benefit received more than $2,500,000,less than $7,000,000 +18TOTAL lb"

c. Base Fine. Based upon USSG 8C2.4(a)(l), the base fine is $10,500,000.d. CulpabilityScore. Based upon USSG 8C2.5, the culpability score is 7,

calculated as follows:

(a) Base Culpability Score 5(b)(2) the organization had 1,000or more employees andan individual within high-level personnel of theorganization participated in, condoned, or waswillfully ignorant of the offense +4(g)(2) the organization fully cooperated in the

investigation and clearly demonstratedrecognition and affirmative acceptance ofresponsibility for its criminal conduct -2

TOTAL 7Calculation of Fine Range:Base Fine $10,500,000Multipliers 1.4(min)/2.8(max)Fine Range $14,700,000 / $29,400,000



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The Company agrees to pay amonetary penalty in the amount of $11,760,000, anapproximately20percent reduction offthebottom of the fine range, to the United States Treasury within ten(10)days of the filing ofthe Information. TheCompany andtheDepartment agree thatthis fineis appropriate given the facts and circumstances ofthiscase, including theCompany'scooperation, extensive remediation, commitment to continue to enhance itscompliance program,andculpability relative to othercompanies examined inthis investigation. The $11,760,000penalty is final andshall notbe refunded. Furthermore, nothing inthisAgreement shall bedeemed anagreement by theDepartment that$11,760,000 isthemaximum penalty thatmay beimposed inany future prosecution, and the Department isnot precluded from arguing in anyfuture prosecution that the Court should impose a higher fine, although the Department agreesthat under those circumstances, itwill recommend to the Court that any amount paid under thisAgreement should beoffset against any fine theCourt imposes aspartof a future judgment. TheCompany acknowledges thatnoUnited States taxdeduction may be sought inconnection withthe payment ofanypartof this$11,760,000 penalty.

Condit ional Release f rom Liabi li ty7. Subject to Paragraphs 14through 17, theDepartment agrees, except as provided

herein, that itwill not bring any criminal orcivil case against theCompany or its subsidiariesrelated to the conduct described in theattached Statement ofFacts or relating to information thatthe Company disclosed to the Department prior to the date onwhich this Agreement was signed.However, the Departmentmay use any informationrelated to the conduct described in theattached StatementofFacts against the Company: (a) in a prosecution for perjury orobstructionofjustice; (b)ina prosecution for making a false statement; (c)ina prosecution orother



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proceeding relating toany crime ofviolence; or (d) in a prosecution orother proceeding relatingto a violationofany provisionof Title 26 of the UnitedStates Code.

a. This Paragraph does notprovide any protection against prosecution forany future corrupt payments, false books and records, or inadequate controls by the Company.b. Inaddition, this Paragraph does notprovide anyprotection against

prosecution of any present or former officer, director, employee, shareholder, agent, consultant,contractor, or subcontractor of theCompany foranyviolations committed bythem.

Corpora te Compliance Program

8. TheCompany represents that it has implemented andwill continue to implementa compliance and ethics program designed to prevent and detect violations of the FCPA andotherapplicable anti-corruption lawsthroughout its operations including thoseof its affiliates,agents,and joint ventures, and thoseof its contractors and subcontractorswhose responsibilitiesinclude interacting withforeignofficials or other high-risk activities. Implementation of thesepolicies andprocedures shallnotbeconstrued inanyfuture enforcement proceeding as providingimmunity or amnesty for anycrimes notdisclosed totheDepartment asofthedateof signing ofthisAgreement forwhichthe Company wouldotherwise be responsible.

9. Inorder to address any deficiencies in its internal controls, policies, andprocedures, the Company represents that it has undertaken, and will continue to undertake in thefuture, ina manner consistent withall of itsobligations under thisAgreement, a review of itsexisting internal controls,policies, and proceduresregardingcompliancewith the FCPAandother applicable anti-corruption laws. If necessary andappropriate, theCompany will adopt newormodify existing internal controls, policies, andprocedures inorderto ensure thattheCompanymaintains: (a)a system of internal accounting controls designed to ensure themaking and

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keeping of fair and accurate books, records, and accounts; and (b) a rigorous anti-corruptioncompliance code, standards, and procedures designed to detect and deter violations of the FCPA

and other applicable anti-corruption laws. The internal controlssystemand compliance code,standards, and procedures will include, but not be limited to, the minimum elements set forth inAttachmentC, which is incorporated by reference into this Agreement.

Enhanced Compliance Under taking10. The Company represents that it has or will also undertake, at a minimum, the

enhanced compliance obligations described inAttachment C, for the duration of this Agreement.11. The Companyagrees that it will reportto theDepartment annuallyduring the

termof theAgreement regarding remediation and implementation of the compliance measuresdescribed inAttachment C. These reports will be prepared in accordance withAttachment D.

Defer red Prosecu t ion

12. In consideration of: (a) the past and future cooperation of the Company describedin Paragraphs 4and5 above; (b) theCompany's payment of a criminal penalty of $11,760,000;and (c) the Company's implementation and maintenance of remedial measures as described inParagraphs 8 through 11 above, theDepartment agrees thatany prosecution oftheCompany fortheconduct setforth inthe attached Statement ofFacts, andfortheconduct thattheCompany oritssubsidiaries disclosed totheDepartment prior to the signing of this Agreement, beand herebyis deferred for the Termof this Agreement.

13. TheDepartment furtheragrees that if the Company fully complies withall of itsobligations under thisAgreement, theDepartment will notcontinue the criminal prosecutionagainst theCompany described in Paragraph 1or initiate anyprosecution against the Companyor its subsidiaries for anyconductthat theCompany disclosed to theDepartment beforethe

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signing of thisAgreement, and, at theconclusionof the Term, thisAgreement shallexpire.Within thirty (30)days of theAgreement'sexpiration, theDepartment shall seek dismissal withprejudice of the criminal Information filed againstthe Company describedin Paragraph 1.

Breach o f the Agreement14. If, duringthe Term of this Agreement, the Departmentdetermines, in itssole

discretion, thattheCompany has(a)committed any felony under U.S. federal lawsubsequent tothe signing of this Agreement; (b)at any time provided inconnection withthisAgreementdeliberately false, incomplete, ormisleading information; (c) failed to cooperate asset forth inParagraph 5ofthisAgreement; (d) failed to implement an enhanced compliance program assetforth inParagraphs 10and 11 ofthisAgreement and Attachment C;or (e) otherwise breachedtheAgreement, theCompany shall thereafter besubject to prosecution for any federal criminalviolation ofwhich the Department has knowledge, including thecharges inthe Informationdescribed in Paragraph 1,which maybepursued bytheDepartment intheU.S. District Courtforthe Eastern District ofVirginia orany other appropriate venue. Any such prosecution may bepremised on information provided bytheCompany. Any such prosecution thatis not time-barred by the applicable statute of limitations on the date of the signing of this Agreement maybecommenced against theCompany notwithstanding theexpiration ofthe statute of limitationsbetween the signing ofthis Agreement and the expiration ofthe Term plus one year. Thus, bysigning this Agreement, the Company agrees that the statute of limitations with respect to anysuch prosecution that isnottime-barred onthedate of the signing of this Agreement shall betolled for the Termplus one year.

15. In the event that the Department determines thatthe Company has breached thisAgreement, theDepartment agrees to provide theCompany withwritten notice of suchbreach

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prior to institutingany prosecution resulting from such breach. The Company shall, within thirty(30) days of receiptof suchnotice, have the opportunityto respondto the Departmentin writingto explainthe natureand circumstancesof such breach, aswell as the actions the Companyhastaken to address andremediate the situation, whichexplanation theDepartment shall considerindetermining whether to institute a prosecution.

16. Inthe event that the Department determines that the Company has breached thisAgreement: (a) all statementsmade byor onbehalfof theCompany to theDepartment or to theCourt, including the attached Statement of Facts, andanytestimony given bytheCompanybefore a grand jury,a court, or any tribunal, orat any legislative hearings, whether prior orsubsequent to this Agreement, and any leads derived from such statements or testimony, shall beadmissible inevidence inany and allcriminal proceedings brought by theDepartment againsttheCompany; and(b)theCompany shall notassert anyclaim undertheUnited StatesConstitution,Rule 11(f)of the Federal Rules ofCriminal Procedure, Rule 410 of the FederalRules ofEvidence, or any other federal rule thatstatements made byoronbehalfoftheCompany prioror subsequent to this Agreement, or any leadsderivedtherefrom, shouldbesuppressed. The decision whether conduct or statements ofany current director oremployee, orany person acting onbehalfof,orat thedirection of,theCompany will be imputed totheCompany for the purpose ofdetermining whether the Company has violated any provision of thisAgreement shall be in the solediscretion of theDepartment.

17. The Company acknowledges that the Department has made no representations,assurances, orpromises concerning what sentence may be imposed by the Court if the Companybreaches this Agreement and this matter proceeds tojudgment. The Company further

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acknowledges thatany suchsentence is solelywithinthe discretion of theCourtandthat nothingin this Agreement binds or restricts the Court in the exercise of such discretion.

Sale o r Merger o f Company18. The Companyagrees that in the event it sells, merges, or transfers all or

substantially all of its businessoperationsas they exist as of the dateof this Agreement,whethersuchsale is structured asa sale, asset sale,merger, or transfer, it shall include in anycontract forsale, merger, or transfer a provisionbinding the purchaser,or any successor in interestthereto, tothe obligationsdescribed in this Agreement.

Public Sta tements by Company19. TheCompanyexpresslyagrees that it shall not, through presentor future

attorneys, officers, directors, employees, agents oranyother person authorized to speak fortheCompany make anypublic statement, in litigation or otherwise, contradicting the acceptance ofresponsibility by the Company set forth above or the facts described in the attached Statement ofFacts. Any such contradictory statement shall, subject to cure rights oftheCompany describedbelow, constitute a breach of this Agreement, and theCompany thereafter shall be subject toprosecution as set forth in Paragraphs 14through 17of this Agreement. Thedecision whetherany public statementby any such person contradictinga fact contained in the StatementofFactswillbe imputed to theCompany for the purpose of determining whether it hasbreached thisAgreement shall beatthesolediscretion oftheDepartment. IftheDepartment determines thatapublic statement byany such person contradicts inwhole or inparta statement contained intheStatement ofFacts, theDepartment shall so notify the Company, and theCompany may avoid abreach of this Agreement by publicly repudiating such statement(s) within five (5) business daysafter notification. TheCompanyshall be permittedto raise defenses and to assert affirmative

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claims in otherproceedings relating to thematters set forth in the Statement of Factsprovidedthat such defensesand claims do not contradict, inwhole or in part, a statement contained in theStatement of Facts. ThisParagraph doesnot applyto anystatementmadeby any presentorformer officer, director, employee, or agent of theCompany inthe course ofany criminal,regulatory, or civil case initiated against such individual, unless such individual is speaking onbehalfof the Company.

20. The Company agrees that if it or any of its direct or indirect subsidiaries oraffiliates issues a press release or holds any press conference in connection with thisAgreement,the Company shall first consult the Department to determine (a) whether the text of the release orproposed statements atthe press conference aretrueand accurate withrespect tomatters betweentheDepartment and theCompany; and(b)whether theDepartment hasnoobjection to therelease.

21. TheDepartment agrees, if requested todoso,to bring to theattention ofgovernmental and other debarment authorities the facts and circumstances relating tothe natureof the conduct underlying this Agreement, including the nature and quality of the Company'scooperation and remediation. Byagreeing to provide this information to debarment authorities,the Department isnot agreeing toadvocate on behalfof the Company, butrather isagreeing toprovide facts to be evaluated independently by the debarment authorities.

Limitations on B ind ing Effect o f Agreement22. This Agreement isbinding on the Company and the Department but specifically

does not bind any other federal agencies, or any state, local or foreign lawenforcement orregulatory agencies, orany other authorities, although the Department will bring the cooperation

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oftheCompany anditscompliance with itsotherobligations under thisAgreement to theattention of such agencies andauthorities if requested todosobytheCompany.

Notice23. Any notice to the Department under this Agreement shall begiven bypersonal

delivery, overnight delivery bya recognized delivery service, or registered or certified mail,addressed to the Deputy Chief- FCPA Unit, Fraud Section, Criminal Division, U.S. Departmentof Justice, Fourth Floor, 1400 New York Avenue, N.W., Washington, D.C. 20005. Any noticeto the Company under this Agreement shall be given by personal delivery, overnight delivery bya recognized delivery service, or registered orcertified mail, addressed to Jon-Al Duplantier,Senior Vice President, ChiefAdministrative Officer, and General Counsel, Parker DrillingCompany, 5 EGreenway Plaza #100, Houston, TX 77046. Notice shall beeffective upon actualreceipt by theDepartment or theCompany.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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Complete Agreement24. This Agreementsets forth all the terms of the agreement between the Company

and the Department. No amendments, modifications or additions to this Agreement shall bevalid unless they are inwriting andsigned bytheDepartment, theattorneys for theCompany anda duly authorized representative of the Company.AGREED:

FOR PARKER DR ILL ING COMPANY :

Dttr.jUj4.MH3 Bv:

Date: (jp^P/^ Z-Ol} By:

.*^-JON-AL DUPLANTIERSenior Vice President Chi^fAdministrativeOfficer, and Genera l CounselParker Drilling Company

MITCHELL S. ETTINXSAUL M. PILCHENSTEPHANIE F. CHEISkadden, Arps, Slate, Meagher & FlomLLPCounsel for ParkerDrillingCompany

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FOR THE DEPARTMENT OF JUSTICE:

Date :

Date: W/|3 BY:

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JEFFREY H. KNOXChief-Fraud Section

*J&M~United States Department of JusticeCriminal Division1400 New York Avenue, N.W.Washington, D.C. 20530Phone: (202)307-1423Fax: (202)514-7021Email: [email protected]

NEIL H. MacBRIDEUNITED STATES ATTORNEY

JASMINE YOONAssistant United States AttorneyCHARLES F. CONNOLLYAssistant United States AttorneyU.S. Attorney's Office2100 Jamieson AvenueAlexandria, VA 22314Phone: (703)299-3700Fax: (703)299-3981E-mail: [email protected]@usdoj.gov



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COMPANY OFFICER 'S CERT IF ICATE

I have read this Agreement and carefully reviewed every part of it with outside counsel

for Parker Drilling Company (the "Company"). I understand the terms of this Agreement andvoluntarily agree, on behalfof the Company, to each of its terms. Before signing thisAgreement, I consulted outside counsel for the Company. Counsel fully advised me of the rightsof the Company, of possibledefenses, of the Sentencing Guidelines' provisions, andof theconsequences of entering into this Agreement.

I have carefully reviewed the terms of this Agreement with the Board of Directors of theCompany. 1have advised and caused outside counsel for the Company to advise the Board ofDirectors fully of the rights of the Company, of possibledefenses, of the Sentencing Guidelines*provisions, and of the consequences of entering into the Agreement.

No promises or inducements have been made other than those contained in thisAgreement. Furthermore, no one has threatened or forced me, or tomyknowledge any personauthorizing this Agreement on behalfof theCompany, inanyway to enter intothis Agreement.I amalso satisfied withoutside counsel's representation in this matter. I certify that I am theSenior Vice President, ChiefAdministrative Officer, and General Counsel fortheCompany andthat I have been duly authorized by the Company to execute this Agreement on behalfof theCompany.

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CERTIF ICATE OF COUNSEL

I amcounsel for Parker DrillingCompany (the "Company") in the matter covered bythis Agreement. In connectionwith such representation, I have examined relevant Companydocuments andhave discussed the terms of this Agreement with the CompanyBoardofDirectors. Based onourreview of the foregoing materials and discussions, I amof theopinionthat the representative of the Company hasbeenduly authorizedto enter into this Agreement onbehalfof the Company and that thisAgreement has beenduly andvalidly authorized, executed,and delivered onbehalfof theCompany and is a valid and binding obligation of theCompany.Further, I havecarefully reviewed the terms of thisAgreementwith the Board of Directors andthe Senior Vice President, ChiefAdministrative Officer, and General Counsel of theCompany. Ihave fully advised them of the rights of theCompany, of possible defenses, of theSentencingGuidelines' provisions andof the consequences of entering into thisAgreement. Tomyknowledge, the decision of the Company to enter into this Agreement, based on the authorizationof the Board of Directors, is an informed and voluntary one.

Date: (byS^ f V 2013J%Mt8ky litchell S. EttingerfSaul M. Pilchen (ret.)Stephanie F. ChernySkadden, Arps, Slate, Meagher & Flom LLPCounsel for Parker Drilling Company


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