Filed pursuant to Rule 424(b)(5)
Registration No. 333-133563

 

Prospectus Supplement
(To Prospectus Dated April 26, 2006)

 

 

GulfMark Offshore, Inc.

 

2,000,000 Shares of

 

Common Stock

 

 

We are selling 2,000,000 shares of our common stock, par value $.01 per share, in this offering. Upon completion of this offering, we will have 22,677,903 shares of common stock outstanding. Our common stock is listed on the NASDAQ Global Select Market under the symbol “GMRK.” The last reported sale price of our common stock on December 4, 2006 was $40.80 per share.

 

You should carefully read this prospectus supplement and the accompanying prospectus, together with the documents we incorporate by reference, before you invest in our common stock.

 

Investing in our common stock involves significant risks. See “Risk Factors” beginning on page 4 of the accompanying prospectus.

 

Jefferies & Company, Inc. has agreed to purchase the shares from us at a price per share of $38.50 (approximately $76.9 million aggregate proceeds to us after deducting estimated offering expenses payable by us), subject to the terms and conditions set forth in an underwriting agreement between Jefferies & Company, Inc. and us. Jefferies & Company, Inc. may also purchase up to an additional 300,000 shares from us, at the same price (approximately $88.4 million aggregate proceeds to us after deducting estimated offering expenses, assuming the option is exercised in full), within 30 days from the date of this prospectus supplement, to cover overallotments. Jefferies & Company, Inc. proposes to offer the shares for sale from time to time in one or more negotiated transactions, or otherwise, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices.

 

Neither the Securities and Exchange Commission nor any other state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

 

The shares of common stock included in this offering will be ready for delivery on or about December 7, 2006.

 

Jefferies & Company

 

The date of this Prospectus Supplement is December 4, 2006.

 

Table of Contents

 

Prospectus Supplement

 

Prospectus

 

This document is in two parts. The first part is the prospectus supplement, which describes the terms of this offering of shares of our common stock. The second part is the accompanying prospectus, which provides more general information. Generally, when we refer to the prospectus, we are referring to both parts of this document combined. If the description of this offering varies between the prospectus supplement and the accompanying prospectus, you should rely on the information in this prospectus supplement. This prospectus supplement contains information about the shares of our common stock offered in this offering and may add, update or change information in the accompanying prospectus. Before you invest in shares of our common stock, you should carefully read this prospectus supplement, along with the accompanying prospectus, in addition to the information contained in the documents we refer to under the heading “Available Information” and “Documents Incorporated by Reference” in this prospectus supplement and the accompanying prospectus.

 

Terms used but not defined in this prospectus supplement shall have the meanings ascribed to them in the accompanying prospectus.

 

YOU SHOULD RELY ONLY ON THE INFORMATION INCLUDED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS OR ANY FREE WRITING PROSPECTUS PREPARED BY US. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE INFORMATION OR REPRESENT ANYTHING OTHER THAN THAT CONTAINED IN, OR INCORPORATED BY REFERENCE IN, THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION. IF YOU RECEIVE ANY OTHER INFORMATION, YOU SHOULD NOT RELY ON IT. WE ARE NOT MAKING AN OFFER IN ANY STATE OR JURISDICTION OR UNDER ANY CIRCUMSTANCES WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD ASSUME THAT THE INFORMATION IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS OR ANY FREE WRITING PROSPECTUS PREPARED BY US IS ACCURATE ONLY AS OF THE DATE ON THEIR COVER PAGES AND THAT ANY INFORMATION WE HAVE INCORPORATED BY REFERENCE IS ACCURATE ONLY AS OF THE DATE OF THE DOCUMENT INCORPORATED BY REFERENCE.

 

Summary

 

The Offering

Common stock offered		2,000,000(a)
Common stock outstanding after the offering		22,677,903(a)
Use of proceeds		We estimate that we will receive net proceeds from the common stock offering of $76.9 million ($88.4 million if the underwriter exercises its overallotment option in full), after deducting estimated offering expenses payable by us. We plan to use the net proceeds of the offering for:
		• repayment of amounts borrowed under our existing credit facility; and
		• general corporate purposes, which may include funding of our new vessel construction program and the acquisition of other vessels.
		Net proceeds will be invested in short-term investments until they are used.
NASDAQ Global Select Market symbol		GMRK

(a)	Does not include shares that may be issued to the underwriter pursuant to its overallotment option. If the underwriter exercises its overallotment option in full, the total number of shares of common stock offered will be 2,300,000 shares and the total number of outstanding shares of our common stock will be 22,977,903. We had 20,677,903 shares of common stock outstanding on December 1, 2006.

 

We intend to use the net proceeds of this offering to repay amounts borrowed under our existing credit facility and for general corporate purposes, which may include funding of our new vessel construction program and the acquisition of other vessels. Net proceeds will be invested in short-term investments until they are used.

 

The indebtedness outstanding under our revolving credit facility is due on June 5, 2013, the seventh anniversary of the date we entered into the facility. Based upon a December 4, 2006 exchange rate, the current amount outstanding is $45.6 million, with interest rates of 6.06% for $11.0 million outstanding, 5.825% for 15.0 million British Pound Sterling outstanding, and 4.24% for 30.0 million Norwegian Kroner outstanding. We used the proceeds from our revolving credit facility to refinance our previous credit facility, to finance our new build program and to satisfy mortgages on two vessels.

 

Our common stock is traded on the NASDAQ Global Select Market, formerly known as the NASDAQ National Market, under the symbol “GMRK.” The following table sets forth on a per share basis the high and low sales prices on the NASDAQ Global Select Market for our common stock for the periods indicated.

 

 

 

 

We have not declared or paid cash dividends during the past five years. Pursuant to the terms of the indenture under which our 7.75% senior notes are issued, we may be restricted from declaring or paying cash dividends; however, we currently anticipate that, for the foreseeable future, any earnings will be retained for the growth and development of our business. The declaration of dividends is at the discretion of our Board of Directors. Our dividend policy will be reviewed by the Board of Directors at such time as may be appropriate in light of future operating conditions, dividend restrictions of subsidiaries and investors, financial requirements, general business conditions and other factors.

 

 

The last reported sale price of our common stock on December 4, 2006 on the NASDAQ Global Select Market, was $40.80 per share. As of December 1, 2006, there were approximately 556 holders of record of our common stock and there were 20,677,903 shares of common stock outstanding prior to the issuance of shares pursuant to this prospectus supplement.

 

We are selling 2,000,000 shares (excluding the overallotment option) of our common stock in this offering. We have entered into an underwriting agreement with Jefferies & Company, Inc., as underwriter. Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to the underwriter, and the underwriter has agreed to purchase all the shares of our common stock, if any are purchased, at a price per share of $38.50. The underwriter may also purchase up to an additional 300,000 shares from us, at the same price, within 30 days from the date of this prospectus supplement, to cover overallotments.

 

The underwriting agreement provides that the underwriter’s obligation to purchase shares of our common stock from us depends on the satisfaction of the conditions contained in the underwriting agreement, including that:

 

 

Net Proceeds and Expenses of the Offering

 

The underwriter has agreed to purchase the shares from us at a price per share of $38.50 (approximately $76.9 million ($88.4 million if the underwriter exercises its overallotment option in full) aggregate proceeds to us after deducting estimated offering expenses payable by us), subject to the terms and conditions set forth in the underwriting agreement. We have been advised by the underwriter that it proposes to offer the shares of common stock for sale from time to time in one or more negotiated transactions, or otherwise, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices.

 

We estimate that the expenses of this offering to be paid by us, will be approximately $150,000.

 

Stabilization and Short Positions

 

The offering price of our common stock may not correspond to the price at which our common stock will trade in the public market subsequent to this offering.

 

In connection with this offering, the underwriter may engage in stabilizing transactions and overallotment transactions in accordance with Regulation M under the Securities Exchange Act of 1934.

 

 

These stabilizing transactions and overallotment transactions may have the effect of raising or maintaining the market price of our common stock or preventing or retarding a decline in the market price of our common stock. As a result, the price of our common stock may be higher than the price that might otherwise exist in the open market. These transactions may be effected on the NASDAQ Global Select Market or otherwise and, if commenced, may be discontinued at any time.

 

Neither we nor the underwriter make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the common stock. In addition, neither we nor the underwriter make any representation that the underwriter will engage in these stabilizing transactions or that any transaction, once commenced, will not be discontinued without notice.

 

Indemnification

 

We have agreed to indemnify the underwriter against certain liabilities, including liabilities under the Securities Act, or contribute to payments that the underwriter may be required to make in respect of those liabilities.

 

Lock-up Agreements

 

Our directors and executive officers have agreed, with limited exceptions, for a period of 90 days after the date of this prospectus supplement, subject to extension under certain circumstances, not to, without the prior written consent of the underwriter, directly or indirectly, offer, sell or otherwise dispose of any shares of our common stock or securities convertible into or exchangeable or exercisable for any shares of our common stock or enter into any derivative transaction with similar effect as a sale of shares of our common stock.

 

We have also agreed, with limited exceptions, for a period of 90 days after the date of this prospectus supplement, subject to extension under certain circumstances, not to, without the prior written consent of the underwriter, directly or indirectly, offer, sell or otherwise dispose of, or announce the offering of, or file any registration statement under the Securities Act in respect of, any shares of our common stock or securities convertible into or exchangeable or exercisable for any shares of our common stock or enter into any derivative transaction with similar effect as a sale of shares of our common stock, except that we may issue shares of common stock under employee benefit plans, including stock option plans, existing as of the date of this prospectus or any amendment or replacement of any such plan and the filing of or amendment to any registration statement related to the foregoing.

 

The underwriter may, however, in its sole discretion and at any time or from time to time before the termination of the 90-day period referenced above, without notice, release all or any portion of the securities subject to lock-up agreements. This 90-day period may be extended under certain circumstances if (1) during the last 17 days of the 90-day period, we issue an earnings release or material news or a material event regarding us occurs or (2) prior to the expiration of the 90-day period, we announce that we will release earnings results during the 16-day period beginning on the last day of the 90-day period. The period of such extension will be 18 days, beginning on the issuance of the earnings release or the occurrence of the material news or material event.

 

Listing

 

Our shares of common stock are traded on the NASDAQ Global Select Market under the symbol “GMRK.”

 

Prior Transactions

 

The underwriter has provided investment banking and advisory services for us from time to time for which it has received customary fees and expenses. The underwriter may, from time to time in the future, engage in transactions with and continue to perform services for us in the ordinary course of its business.

 

Electronic Distribution

 

A prospectus and prospectus supplement in electronic format may be made available on Internet sites or through other online services maintained by the underwriter or its affiliates. In those cases, prospective investors may view

offering terms online and, depending upon the underwriter, prospective investors may be allowed to place orders online. The underwriter may agree with us to allocate a specific number of shares of common stock for sale to

online brokerage account holders. Any such allocation for online distributions will be made by the representatives on the same basis as other allocations.

 

Other than the prospectus and prospectus supplement in electronic format, the information on the underwriter’s designated website and any information contained in any other website maintained by the underwriter is not part of the prospectus or this prospectus supplement or the registration statement of which the prospectus forms a part, has not been approved and/or endorsed by us or the underwriter in its capacity as underwriter and should not be relied upon by investors.

 

Transfer Agent

 

The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company.

 

Certain legal matters in connection with the shares of common stock offered hereby will be passed upon for us by Strasburger & Price, L.L.P., Houston, Texas, and for the underwriter by Baker Botts L.L.P., Houston, Texas.

 

Our consolidated financial statements as of December 31, 2004 and for each of the two years in the period ended December 31, 2004 appearing in our Annual Report on Form 10-K for the year ended December 31, 2005, have been audited by Ernst & Young LLP, or E&Y, an independent registered public accounting firm, as set forth in their report thereon, included therein, and incorporated herein and the accompanying prospectus by reference. Such consolidated financial statements are incorporated herein by reference and the accompanying prospectus in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

 

On May 23, 2005, we notified E&Y that we had dismissed E&Y as our independent registered public accounting firm. On May 24, 2005, our Audit Committee of the Board of Directors appointed UHY Mann Frankfort Stein & Lipp CPAs, LLP as our independent registered public accounting firm for the year ending December 31, 2005.

 

Our consolidated financial statements as of December 31, 2005, and the related consolidated statements of operations, stockholders’ equity, comprehensive income, and cash flows for the year then ended incorporated in this prospectus supplement and the accompanying prospectus by reference to our Annual Report on Form 10-K for the year ended December 31, 2005, and our management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2005 included therein have been audited by UHY Mann Frankfort Stein & Lipp CPAs, LLP, or UMFSL, an independent public accounting firm, as set forth in their reports included therein and incorporated by reference herein and the accompanying prospectus in reliance upon such reports given on the authority of said firm as experts in auditing and accounting.

 

On July 27, 2006, the partners of UMFSL announced that they were joining UHY LLP, or UHY, a New York limited liability partnership. On that same day, UMFSL notified us that it had ceased to provide audit services, and accordingly, resigned as our independent public auditors. None of the reports of UMFSL on our financial statements for the past year or subsequent interim periods contained an adverse opinion or disclaimer of opinion, or was qualified or modified as to uncertainty, audit scope or accounting principles.

 

On July 27, 2006, we engaged UHY as our independent public auditor for our fiscal year ending December 31, 2006 and the interim periods prior to such year-end. The decision to change principal accountants was approved by the Audit Committee of our Board of Directors.

 

GulfMark Offshore, Inc.

 

 

$250,000,000

 

Common Stock,

Preferred Stock,

Debt Securities,

and/or Warrants to Purchase Common Stock

 

We may from time to time offer up to $250,000,000 in aggregate initial offering price of common stock, preferred stock, debt securities, and/or warrants to purchase our common stock.

 

Our common stock is listed on the Nasdaq National Market under the symbol “GMRK.”

 

See “Risk Factors” on page 4 to read about factors you should consider before buying shares of our common stock or other securities we may offer for sale.

 

We may offer these securities to or through underwriters, and also to other purchasers or through agents. The names of the underwriters will be set forth in a prospectus supplement. The prospectus supplement may also update or change the information contained in this prospectus. You should read this prospectus and any related prospectus supplement carefully before you invest in our securities.

 

Neither the Securities and Exchange Commission nor any other state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

 

Prospectus dated April 26, 2006.

 

TABLE OF CONTENTS

 

 

This prospectus and the documents incorporated by reference herein contain statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, or the Exchange Act.

 

Such forward-looking statements typically include words or phrases such as “anticipate,” “estimate,” “projects,” “believes,” and words or phrases of similar import. Forward-looking statements and other statements that are not historical facts concerning, among other things, market conditions, the demand for marine support and transportation services and future capital expenditures, are subject to certain risks, uncertainties and assumptions, including without limitation:

 

 

These statements are based on certain assumptions and analyses made by us in light of our experience and perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Such statements are subject to risks and uncertainties, including the risk factors discussed above, general economic and business conditions, the business opportunities that may be presented to and pursued by us, changes in law or regulations and other factors, many of which are beyond our control. When considering any forward-looking statement, you should also keep in mind the risk factors described under the section entitled “Risk Factors” beginning on page 6 of this prospectus and any other risk factors described in an applicable prospectus supplement. There can be no assurance that we have accurately identified and properly weighed all of the factors which affect market conditions and demand for our vessels, that the information upon which we have relied is accurate or complete, that our analysis of the market and demand for our vessels is correct or that the strategy based on such analysis will be successful. Each forward-looking statement speaks only as of the date of this prospectus or the document in which it appears and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

This prospectus is part of a registration statement that we filed with the SEC using a shelf registration process. Under this shelf registration process, we may offer from time to time any combination of the securities described in this prospectus in one or more offerings up to a total dollar amount of $250,000,000.

 

This prospectus provides you with a general description of the securities that we may offer. Each time we offer securities, we will provide a prospectus supplement that will contain specific information about the terms of that offering. The prospectus supplement may also add to or update other information contained in this prospectus. You should read both this prospectus and the accompanying prospectus supplement, together with additional information described below under the headings “Available Information” and “Documents Incorporated by Reference.”

 

As used in this prospectus generally, the terms “GulfMark,” “the Company,” “we,” “our” or “us” means GulfMark Offshore, Inc. and its direct or indirect subsidiaries. Our principal office is located at 10111 Richmond Ave., Suite 340, Houston, TX 77042 and our phone number is (713) 963-9522. Our internet address is www.gulfmark.com. Information on our website is not a part of this prospectus.

 

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT. WE HAVE NOT AUTHORIZED ANYONE ELSE TO PROVIDE YOU WITH DIFFERENT INFORMATION. YOU SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THAT DOCUMENT. OUR BUSINESS, FINANCIAL CONDITION, RESULTS OF OPERATIONS AND PROSPECTS MAY HAVE CHANGED SINCE THOSE DATES.

 

An investment in our securities involves significant risks. You should carefully consider the risk factors described below before deciding whether to invest in our securities. The risks and uncertainties described below are not the only risks we face. You should also carefully read and consider all of the information we have included, or incorporated by reference, in this prospectus, before you decide to invest in our securities. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business.

 

Risk Factors Related to Our Business

 

We rely on the oil and natural gas industry, and volatile oil and natural gas prices impact demand for our services.

 

Demand for our services depends on activity in offshore oil and natural gas exploration, development and production. The level of exploration, development and production activity is affected by factors such as:

 

 

During recent years, the level of offshore exploration, development and production activity has been volatile. Currently, there is a period of high prices for oil and natural gas, and oil and natural gas companies have increased their exploration and development activities. This activity increase began in the second half of 2004 and continued into 2005 and early 2006 after reduced levels of activity were experienced in 2002-2004 despite high prices for oil and natural gas during that period. A decline in the worldwide demand for oil and natural gas or prolonged low oil or natural gas prices in the future below historical oil and gas prices, however, would likely result in reduced exploration and development of offshore areas and a decline in the demand for our offshore marine services. Any such decrease in activity is likely to reduce our day rates and our utilization rates and, therefore, could have a material adverse effect on our financial condition and results of operations.

 

An increase in a supply of offshore support vessels would likely have a negative effect on charter rates for our vessels, which could reduce our earnings.

 

Charter rates for marine support vessels depend in part on the supply of the vessels. Excess vessel capacity in the industry may result from:

 

 

In the last ten years, construction of vessels of the type operated by us for use in the North Sea and elsewhere has significantly increased. The addition of new capacity to the worldwide offshore marine fleet is likely to increase competition in those markets where we presently operate which, in turn, could reduce day rates, utilization rates and operating margins which would adversely affect our financial condition and results of operations.

Government regulation and environmental risks reduce our business opportunities and increase our costs.

 

We must comply with extensive government regulation in the form of international conventions, federal and state laws and regulations in jurisdictions where our vessels operate and are registered. These conventions, laws and regulations govern:

 

 

We believe that we are in compliance with the laws and regulations to which we are subject. We are not a party to any material pending regulatory litigation or other proceeding and we are unaware of any threatened litigation or proceeding, which, if adversely determined, would have a material adverse effect on our financial condition or results of operations. However, the risks of incurring substantial compliance costs, liabilities and penalties for noncompliance are inherent in offshore marine services operations. Compliance with environmental, health, safety and vessel and port security laws increases our costs of doing business. Additionally, environmental, health, safety and vessel and port security laws change frequently. Therefore, we are unable to predict the future costs or other future impact of environmental, health, safety and vessel and port security laws on our operations. There can be no assurance that we can avoid significant costs, liabilities and penalties imposed on us as a result of government regulation in the future.

 

We are subject to hazards customary for the operation of vessels that could adversely affect our financial performance if we are not adequately insured or indemnified.

 

Our operations are subject to various operating hazards and risks, including:

 

• catastrophic marine disaster;

 

 

These risks represent a threat to the safety of personnel and to our vessels, cargo, equipment under tow and other property, as well as the environment. We could be required to suspend our operations or request that others suspend their operations as a result of these hazards. In such event, we would experience loss of revenue and possibly property damage and, additionally, third parties may have significant claims against us for damages due to personal injury, death, their property damage, pollution and loss of business.

 

We maintain insurance coverage against substantially all of the casualty and liability risks listed above, subject to deductibles and certain exclusions. We have renewed our primary insurance program for the insurance year 2006-2007 and have negotiated terms for renewal in 2007-2008 for our primary coverage. Additionally, there is no assurance that our insurance coverage will be available beyond the renewal periods or will be adequate to cover future claims that may arise.

Substantially all our revenues are derived from our international operations and those operations are subject to government regulation and operating risks.

 

We derive substantially all of our revenues from foreign sources. We therefore face risks inherent in conducting business internationally, such as:

 

 

In the past, these conditions or events have not materially affected our operations. However, we cannot predict whether any such conditions or events might develop in the future. Also, our subsidiary structure and our operations are in part based on certain assumptions about various foreign and domestic tax laws, currency exchange requirements and capital repatriation laws. While we believe our assumptions are correct, there can be no assurance that taxing or other authorities will reach the same conclusion. If our assumptions are incorrect, or if the relevant countries change or modify such laws or the current interpretation of such laws, we may suffer adverse tax and financial consequences, including the reduction of cash flow available to meet required debt service and other obligations. Any of these factors could materially adversely affect our international operations and, consequently, our business, operating results and financial condition.

 

Our international operations are vulnerable to currency exchange rate fluctuations and exchange rate risks.

 

We are exposed to foreign currency exchange rate fluctuations and exchange rate risks as a result of our foreign operations. To minimize the financial impact of these risks, we attempt to match the currency of our debt and operating costs with the currency of the revenue streams. We occasionally enter into forward foreign exchange contracts to hedge specific exposures, but we do not speculate in foreign currencies. Because we conduct a large portion of our operations in foreign currencies, any increase in the value of the U.S. Dollar in relation to the value of applicable foreign currencies could potentially adversely affect our operating revenues when translated into U.S. Dollars.

 

Our substantial indebtedness could adversely affect our financial health and prevent us from fulfilling our financial obligations.

 

We have now and, after this offering, to the extent proceeds from this offering are not used to reduce our indebtedness, will continue to have a significant amount of indebtedness. As of December 31, 2005, we had $249.8 million of outstanding indebtedness consisting of approximately $159.4 million of our 7.75% senior notes, $10.7 million related to certain vessel mortgages, $0.3 million related to the joint venture with Aker Brattvaag A.S. for the construction of the Aker PSV09, and $79.4 million under our credit facilities. As of December 31, 2005, the total outstanding under our $100 million credit facility was $59.7 million. Our $50 million acquisition credit facility had $19.7 million outstanding as of December 31, 2005. In addition, we and our subsidiaries may incur substantial additional indebtedness in the future. Although the indenture governing our 7.75% senior notes due 2014, and the agreements relating to our existing indebtedness, contain restrictions on the incurrence of additional

indebtedness, these restrictions are subject to a number of significant qualifications and exceptions, which would allow us to incur a substantial amount of additional indebtedness. Our substantial indebtedness could:

 

 

Any additional indebtedness we incur will exacerbate the risks described above. The restrictions contained in the indenture governing our 7.75% senior notes due 2014 do not prevent us from incurring obligations unless those obligations constitute indebtedness as defined in the indenture governing those notes.

 

Vessel construction and repair projects are subject to risks, including delays and cost overruns, that could have an adverse impact on our results of operations.

 

Our vessel construction and repair projects are subject to the risks of delay and cost overruns inherent in any large construction project, including:

 

 

Significant cost overruns or delays in connection with our repair projects would adversely affect our financial condition and results of operations. Significant delays could also result in penalties under, or the termination of, most of the long-term contracts under which we plan to operate our vessels.

 

Our current operations and future growth may require significant additional capital, and our substantial indebtedness could impair our ability to fund our capital requirements.

 

Expenditures required for the repair, certification and maintenance of a vessel typically increase with vessel age. These expenditures may increase to a level at which they are not economically justifiable. We cannot assure you that we will have sufficient resources to maintain our fleet either by extending the economic life of existing vessels through major refurbishment or by acquiring new or used vessels.

Our industry is highly competitive, which depresses vessel prices and utilization and adversely affects our financial performance.

 

We operate in a competitive industry. The principal competitive factors in the marine support and transportation services industry include:

 

 

Many of our competitors have substantially greater resources than we have. Competitive bidding and downward pressures on profits and pricing margins could adversely affect our business, financial condition and results of operations.

 

We are subject to war, sabotage and terrorism risk.

 

War, sabotage, and terrorist attacks or any similar risk may affect our operations in unpredictable ways, including changes in the insurance markets, disruptions of fuel supplies and markets, particularly oil, and the possibility that infrastructure facilities, including pipelines, production facilities, refineries, electric generation, transmission and distribution facilities, could be direct targets of, or indirect casualties of, an act of terror. War or risk of war may also have an adverse effect on the economy. Terrorist attacks have made it difficult to obtain insurance coverage. The costs for such coverage has increased and could continue to increase. We will evaluate the need to maintain this coverage as it applies to our fleet in the future. Instability in the financial markets as a result of war, sabotage or terrorism could also affect our ability to raise capital and could also adversely affect the oil, gas and power industries and restrict their future growth.

 

We depend on key personnel.

 

We depend to a significant extent upon the efforts and abilities of our executive officers and other key management personnel. There is no assurance that these individuals will continue in such capacity for any particular period of time. The loss of the services of one or more of our executive officers or key management personnel could adversely affect our operations.

 

We have previously identified material weaknesses under the Sarbanes-Oxley Act relating to the effectiveness of our internal controls over financial reporting and we may identify additional material weaknesses in the future.

 

The SEC, as directed by Section 404 of the Sarbanes-Oxley Act, adopted rules generally requiring each public company to include a report of management on the company’s internal controls over financial reporting in its annual report on Form 10-K that contains an assessment by management of the effectiveness of the company’s internal controls over financial reporting. In addition, the company’s independent registered public accounting firm must attest to and report on management’s assessment of the effectiveness of the company’s internal controls over financial reporting. This requirement first applied to our annual report on Form 10-K for the year ending December 31, 2004.

As of December 31, 2004, our management identified three “material weaknesses” in our internal financial controls. These material weaknesses related to:

 

(1) the financial statement close process, including insufficient controls over:

 

 

(2) accounting for the effects of foreign currencies, including insufficient controls over the analysis of the foreign currency translation and transaction impact of intercompany amounts, as well as amounts owed to third parties denominated in nonfunctional currencies; and

 

(3) accounting for income taxes associated with new international operations, including insufficient controls over the proper identification and application of the relevant Brazilian tax rules to the calculation of the tax provision of our new Brazilian operations.

 

A remediation program has been completed, including the establishment of additional controls, that are intended to strengthen our financial reporting and to specifically address the identified material weaknesses.

 

This program and the enhanced controls included:

 

 

We believe that these actions and resulting improvement in controls will strengthen our disclosure controls and procedures, as well as our internal control over financial reporting, and have remediated the material weaknesses that we identified in our internal control over financial reporting at December 31, 2004.

 

Although we have taken the foregoing steps to correct these internal control deficiencies, these measures may not ensure that we will implement and maintain adequate controls over our financial reporting in the future. Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet our future reporting obligations. In addition, we may in the future identify further material weaknesses or significant deficiencies in our internal control over financial reporting.

 

Since the requirements of Section 404 of the Sarbanes-Oxley Act are relatively new, we are unable to predict the adverse impact, if any, these possible events could have on the markets for our publicly traded securities, or what, if any, the legal consequences to us might be. Some of the adverse consequences could include the following:

 

 

Risk Factors Related to the Offering

 

Future sales of shares in our common stock and the resulting dilution that would occur with such sales could cause the market price of our common stock to decline.

 

Sales of a substantial number of shares of our common stock in the public market in the course of any offering made pursuant to this registration statement or any subsequent registration statement, or the perception that such sales could occur, could materially adversely affect the market price of our common stock and make it more difficult for us to sell equity securities in the future at a time and price we deem appropriate. As of April 26, 2006, we had 20,580,287 shares of our common stock outstanding. Currently, we are unable to determine the number of shares of common stock that will be outstanding after the offering made pursuant to this registration statement and any applicable supplements to this registration statement, but we will provide that information if and when the securities that are registered under this registration statement are offered for sale.

 

We file annual, quarterly and special reports, proxy statements and other information with the SEC. Our SEC filings are available to the public over the internet at the SEC’s web site at http://www.sec.gov. Our website address is www.gulfmark.com. We make available free of charge on or through our website our annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. Information on our website is not incorporated by reference into this prospectus or made a part hereof for any purpose. You may also read and copy any document we file at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 for further information on operation of the Public Reference Room and copy charges.

 

 

The SEC allows us to “incorporate by reference” the information we file with the SEC, which means that we can disclose important information to you by referring to other documents on file with the SEC. Some information that we currently have on file is incorporated by reference and is an important part of this prospectus. Some information that we file later with the SEC will automatically update and supersede this information.

 

We incorporate by reference the following documents that we have filed or may file with the SEC pursuant to the Securities Exchange Act of 1934 (excluding such documents or portions thereof that are not deemed “filed” under the Exchange Act in accordance with the Exchange Act and applicable SEC rules and regulations):

 

 

Upon your written or oral request, we will provide you with a free copy of any of these filings. You may request copies by writing or telephoning us at: 10111 Richmond Ave., Suite 340, Houston, Texas 77042, (713) 963-9522, Attention: Edward A. Guthrie.

 

Overview

 

We are a premier provider of marine support and transportation services to companies involved in the offshore exploration and production of oil and natural gas. Our fleet of vessels provides various services that support the ongoing operation and construction of offshore oil and natural gas facilities and drilling rigs, including the transportation of materials, supplies and personnel, and the positioning of drilling structures. We conduct a majority of our operations in the North Sea, with the balance in offshore Southeast Asia and the Americas. Periodically, we contract vessels into other regions to meet our customers’ requirements. As of April 26, 2006, we owned 49 vessels and managed 11 vessels for other owners.

 

We operate the following operating segments: the North Sea, Southeast Asia and the Americas. Our chief operating decision maker regularly reviews financial information about each of these operating segments in deciding how to allocate resources and evaluate performance. The business within each of these geographic regions has similar economic characteristics, services, distribution methods and regulatory concerns. All of the operating segments are considered reportable segments under Statement of Financial Accounting Standards, or SFAS, No. 131, “Disclosures about Segments of an Enterprise and Related Information.” For financial information about our operating segments and geographic areas, see “Management’s Discussion and Analysis of Financial Condition and Results of Operation — Segment Results” and Note (9) to our Consolidated Financial Statements contained in our Annual Report on Form 10-K for the year ended December 31, 2005.

 

The size, diversity and technologically advanced nature of our fleet enables us to provide offshore exploration and production operators with a broad range of offshore marine services in all major markets. Our fleet has grown in size and capability, from an original 11 vessels in 1990 to our present number of 60 vessels, through strategic acquisitions and new construction of technologically advanced vessels. Presently, we have 34 vessels in the North Sea, 12 vessels offshore Southeast Asia, five vessels offshore Brazil, two vessels offshore India, two vessels in the Mediterranean Sea, two vessels in the Middle East, one in West Africa and two vessels offshore Mexico. The vessels in the Mediterranean Sea, offshore India, the Middle East and offshore West Africa are operated out of our North Sea region. We believe our fleet is among the youngest in the industry with a current overall approximate average age of 14 years and approximately 13 years in our North Sea based fleet.

 

Unless we state otherwise in a prospectus supplement, we will use the net proceeds from the sale of securities sold by us for general corporate purposes, which may include the repayment of debt, acquisitions, capital expenditures and working capital. We may temporarily invest funds we receive from the sale of securities by us that we do not immediately need for these purposes.

 

Our ratio of earnings to fixed charges for the periods indicated below was as follows:

 

 

 

Our ratios of earnings to fixed charges are calculated by dividing earnings by fixed charges for the period indicated, where:

 

 

Because we have no preferred stock issued and outstanding, dividends relating to preferred stock are not included in the calculation of fixed charges.

 

General

 

Our certificate of incorporation, as amended from time to time, authorizes us to issue up to 30,000,000 shares of common stock, par value $0.01 per share, and up to 2,000,000 shares of preferred stock, without par value. As of April 26, 2006, aggregate shares of 20,580,287 common stock and no shares of preferred stock were outstanding. Our common stock is listed on the Nasdaq National Market under the symbol “GMRK.” We have summarized certain provisions of our certificate of incorporation, as amended, and bylaws below, but you should read them for a more complete description of the rights of holders of our common stock.

 

Voting Rights

 

Holders of common stock are entitled to one vote for each share on all matters submitted to a vote of our stockholders. Holders of common stock do not have any cumulative voting rights.

 

Removal of Directors; Filling Vacancies on Board of Directors; Size of the Board

 

Our directors may be removed, with or without cause, by vote of the holders of a majority of the shares then entitled to vote at an election of directors. Vacancies in a directorship or newly created directorships resulting from an increase in the number of directors may be filled by the vote of a majority of the remaining directors then in office, even though less than a quorum. Any director elected to fill a vacancy on the board serves for the remainder of the full term of the class of directors in which the new directorship was created or in which the vacancy occurred. The number of directors is fixed from time to time by the board, but shall not be less than three nor more than 15 persons. Currently, we have seven directors.

 

Special Meetings of the Stockholders

 

Our bylaws provide that a special meeting of stockholders may be called by our chairman of the board upon written request by the board of directors. Our stockholders do not have the power to call a meeting.

 

Dividends

 

Subject to any preferences that may be applicable to any then-outstanding shares of preferred stock, holders of common stock are entitled to receive dividends at such times and amounts as may be declared by our board of directors. We have no specific plans to pay any cash dividends on our common stock in the foreseeable future. Certain of our financing arrangements restrict the payment of cash dividends.

 

Liquidation or Dissolution

 

In the event we liquidate, dissolve, or wind up our affairs, prior to any distributions to the holders of our common stock, our creditors and the holders of our preferred stock, if any, will receive any payments to which they are entitled. Subsequent to those payments, the holders of our common stock will share ratably, according to the number of shares held, in our remaining assets, if any.

 

Other Provisions

 

Shares of our common stock are not redeemable and have no subscription, conversion, or preemptive rights.

 

Transfer Agent and Registrar

 

The Transfer Agent and Registrar for our common stock is American Stock Transfer & Trust Company.

 

Provisions of Our Certificate of Incorporation and Bylaws

 

We are a Delaware corporation. Certain Delaware laws are designed in part to make it more difficult and time consuming for a person to obtain control of our company. These provisions reduce the vulnerability of our

company to an unsolicited takeover proposal. On the other hand, these provisions may have an adverse effect on the ability of stockholders to influence the governance of our company.

 

We have summarized certain provisions of our certificate of incorporation, as amended, and bylaws below, but you should read our certificate of incorporation, as amended, and bylaws for a more complete description of the rights of holders of our common stock.

 

Limitation of Directors Liability

 

Our certificate of incorporation, as amended, contains provisions eliminating the personal liability of our directors to us and our stockholders for monetary damages for breaches of their fiduciary duties as directors to the fullest extent permitted by the Delaware General Corporation Law or any other applicable laws. Under the Delaware General Corporation Law, our directors will not be liable for a breach of his or her duty except for liability for:

 

 

These provisions pertain only to breaches of duty by directors as directors and not in any other corporate capacity, such as officers. In addition, these provisions limit liability only for breaches of fiduciary duties under the Delaware General Corporation Law and not for violations of other laws such as the federal securities laws.

 

As a result of these provisions in our certificate of incorporation, as amended, our stockholders may be unable to recover monetary damages against directors for actions taken by them that constitute negligence or gross negligence or that are in violation of their fiduciary duties. However, our stockholders may obtain injunctive or other equitable relief for these actions. These provisions also reduce the likelihood of derivative litigation against directors that might benefit us.

 

Delaware Section 203

 

As a Delaware corporation, we are subject to Section 203 of the Delaware General Corporation Law. Section 203 imposes a three-year moratorium on the ability of Delaware corporations to engage in a wide range of specified transactions with any “interested stockholder.” An interested stockholder includes, among other things, any person other than the corporation and its majority-owned subsidiaries who owns 15 percent or more of any class or series of stock entitled to vote generally in the election of directors. However, the moratorium will not apply if, among other things, the transaction is approved by:

 

 

Currently, we do not have a stockholder that owns more than 15% of our common stock. If a stockholder acquired more than 15% of our common stock through this offering, then such stockholder would be subject to the restrictions under Section 203.

 

General

 

Our certificate of incorporation authorizes us to issue, without stockholder approval, up to 2,000,000 shares of preferred stock, without par value. As of the date of this prospectus, we have not issued any preferred stock. Our board of directors may from time to time authorize us to issue one or more series of preferred stock and may fix the designation, terms, and relative rights and preferences, including the dividend rate, voting rights, conversion rights, redemption and sinking fund provisions and liquidation values of each of these series.

 

Thus, our board of directors could authorize us to issue preferred stock with voting, conversion and other rights that could adversely affect the voting power and other rights of holders of our common stock or other series of preferred stock. Also, the issuance of preferred stock could have the effect of delaying, deferring or preventing a change in control of our company.

 

The particular terms of any series of preferred stock that we offer with this prospectus will be described in the prospectus supplement relating to that series of preferred stock. Those terms must include:

 

 

General

 

We may issue debt securities from time to time in one or more series. The following description, together with any applicable prospectus supplement, summarizes the material terms and provisions of the debt securities that we may offer under this prospectus and any related indenture or supplemental indenture. We currently have an indenture, dated July 21, 2004, the “Indenture,” between us and U.S. Bank National Association, as trustee. We could issue debt securities under the Indenture, a supplemental indenture, or a new indenture. We will set forth the terms of such debt securities in the applicable prospectus supplement. A form of the indenture is an exhibit to this registration statement of which this prospectus is a part. This form sets forth general terms of the indenture which would likely govern debt securities issued as part of this offering. We will file with the SEC the indenture governing any such debt securities, if not the existing Indenture, and the applicable prospectus supplement will provide more information on its terms.

 

We have summarized below some of the provisions that will apply to the debt securities unless the applicable prospectus supplement provides otherwise. The summary may not contain all information that is important to you. The Indenture, a new indenture and any supplemental indenture will be included or incorporated by reference as exhibits to the registration statement of which this prospectus is a part. You should read the Indenture, a new indenture and any supplemental indenture. You should also read the prospectus supplement, which will contain additional information and which may update or change some of the information below.

 

We will describe the specific terms of the series of debt securities being offered in the related prospectus supplement. These terms will include some or all of the following:

 

 

 

Priority of the Debt Securities

 

Unless otherwise described in the accompanying prospectus, the debt securities will be our general unsecured obligations and will rank pari passu (i.e., equally and ratably) with all of our other senior unsecured and unsubordinated indebtedness. The debt securities will be effectively subordinated to all of our secured indebtedness to the extent of the value of the assets securing that indebtedness. In the event of insolvency, our creditors who are holders of secured indebtedness, as well as some of our general creditors, may recover more, ratably, than the holders of the debt securities.

 

With respect to any offering of debt securities, we will describe in the accompanying prospectus supplement or the information incorporated by reference the approximate amount of our outstanding indebtedness as of the end of our most recent fiscal quarter.

 

Guarantees

 

We do not anticipate that our subsidiaries would initially guarantee our obligations under the debt securities, but under certain circumstances, they could be required to become guarantors. If a guarantee is required, it would likely require a full and unconditional guarantee of our obligations under the debt securities on a joint and several basis subject to the limitation described in the next paragraph. If we defaulted in payment of the principal of, or premium, if any, or interest on, the debt securities, the guarantors, jointly and severally, would likely be unconditionally obligated to duly and punctually make such payments. The prospectus supplement for a particular issue of debt securities will describe any subsidiary guarantors and any material terms of the guarantees for such securities.

 

Each guarantor’s obligations will be limited to the lesser of the following amounts:

 

 

Each guarantor that makes a payment or distribution under its guarantee shall be entitled to contribution from each other guarantor in a pro rata amount based on the net assets of each guarantor.

 

Form and Denominations

 

The debt securities will be issued in fully registered form and in denominations of $1,000 and integral multiples thereof, unless otherwise specified in a prospectus supplement.

 

Transfer and Exchange

 

You may transfer or exchange notes in accordance with the indenture. The registrar and trustee may require you, among other things, to furnish appropriate endorsements and transfer documents and we may require you to pay any taxes and fees required by law or permitted by the indenture. We may not be required to transfer or exchange any note selected for redemption. Also, we may not be required to transfer or exchange any note for a period of 15 days before a selection of notes is to be redeemed.

 

As a registered holder of the note, you will be treated as the owner of it for all purposes.

 

Redemption

 

Unless otherwise provided in the applicable prospectus supplement, we may redeem the debt securities at our option on the terms set forth in the indenture. Upon the occurrence of either a change of control (as defined in the indenture) or certain asset sales, we may be required to offer to purchase outstanding debt securities, in whole

or in part, if we have sale proceeds exceeding some reasonable amount which will be provided for in the indenture and consistent with the industry and the sale proceeds are not timely applied toward repayment of debt or investment in other assets useful to our business.

 

Payment and Paying Agents

 

Unless otherwise provided in a prospectus supplement, we will pay interest to you semi-annually in arrears on each January 15 and July 15 if you are a direct holder listed in the trustee’s records at the close of business on the immediately preceding January 1 and July 1. Holders buying and selling debt securities must work out between them how to compensate for the fact that we will pay all the interest for an interest period to the one who is the registered holder on the record date. The most common manner is to adjust the sale price of the debt securities to allocate interest fairly between buyer and seller. This allocated interest amount is called “accrued interest.”

 

We will pay interest, principal and any other money due on the debt securities at the corporate trust office of the trustee. We may also choose to pay interest by mailing checks to the holders of the debt securities.

 

Interest Rates and Discounts

 

The debt securities will earn interest at a fixed or floating rate or rates for the period or periods of time specified in the applicable prospectus supplement. Unless otherwise specified in the applicable prospectus supplement, the debt securities will bear interest on the basis of a 360-day year consisting of twelve 30-day months.

 

We may sell debt securities at a substantial discount below their stated principal amount, bearing no interest or interest at a rate that at the time of issuance is below market rates. Federal income tax consequences and special considerations that apply to any series will be described in the applicable prospectus supplement.

 

Global Securities

 

We may issue the debt securities in whole or in part in the form of one or more global securities. A global security is a security, typically held by a depositary such as The Depository Trust Company, which represents the beneficial interests of a number of purchasers of such security. We may issue the global securities in either temporary or permanent form. We will deposit global securities with the depositary identified in the prospectus supplement. A global security may be transferred as a whole only as follows:

 

 

We will describe the specific terms of the depositary arrangement with respect to a series of debt securities in a prospectus supplement. We expect that the following provisions will generally apply to depositary arrangements.

 

After we issue a global security, the depositary will credit on its book-entry registration and transfer system the respective principal amounts of the debt securities represented by such global security to the accounts of persons that have accounts with such depositary or participants. The underwriters or agents participating in the distribution of the debt securities will designate the accounts to be credited. If we offer and sell the debt securities directly or through agents, either we or our agents will designate the accounts. Ownership of beneficial interests in a global security will be limited to participants or persons that hold interests through participants. Ownership of beneficial interests in the global security will be shown on, and the transfer of that ownership will be effected only through, records maintained by the depositary and its participants.

 

We and the trustee will treat the depositary or its nominee as the sole owner or holder of the debt securities represented by a global security. Principal, any premium and any interest payments on debt securities represented by a global security registered in the name of a depositary or its nominee will be made to such depositary or its nominee as the registered owner of such global security.

 

Unless otherwise indicated in the applicable prospectus supplement, owners of beneficial interests in a global security will be entitled to have the debt securities represented by such global security registered in their names and

will be entitled to receive physical delivery of such debt securities in definitive form upon the terms set forth in the indenture. The laws of some states require that certain purchasers of securities take physical delivery of the securities. Such laws may impair the ability to transfer beneficial interests in a global security.

 

We expect that the depositary or its nominee, upon receipt of any payments, will immediately credit participants’ accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the global security as shown on the depositary’s or its nominee’s records. We also expect that payments by participants to owners of beneficial interests in the global security will be governed by standing instructions and customary practices, as is the case with the securities held for the accounts of customers registered in “street names” and will be the responsibility of such participants.

 

If the depositary is at any time unwilling or unable to continue as depositary and we do not appoint a successor depositary within ninety days, we will issue individual debt securities in exchange for such global security. In addition, we may at any time in our sole discretion determine not to have any of the debt securities of a series represented by global securities and, in such event, will issue debt securities of such series in exchange for such global security.

 

Neither we, the trustee nor any paying agent will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in such global security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. No such person will be liable for any delay by the depositary or any of its participants in identifying the owners of beneficial interests in a global security, and we, the trustee and any paying agent may conclusively rely on instructions from the depositary or its nominee for all purposes.

 

Covenants

 

With respect to each series of debt securities, we will be required to:

 

 

The indenture for the debt securities may contain covenants limiting our ability, or the ability of our subsidiaries, to:

 

 

Any additional covenants will be described in the applicable prospectus supplement.

 

Unless we state otherwise in the applicable prospectus supplement, we will agree not to consolidate with or merge into any individual, corporation, partnership or other entity (each, a person) or sell, lease, convey, transfer or

otherwise dispose of all or substantially all of our assets to any person, or permit any person to consolidate or merge into us or sell, lease, convey, transfer or otherwise dispose of all or substantially all of its assets to us unless:

 

 

Events of Default

 

Unless we state otherwise in the applicable prospectus supplement, an “event of default” with respect to the debt securities under the indenture means:

 

 

The consequences of an event of default, and the remedies available under the indenture or any supplemental indenture, will vary depending upon the type of event of default that has occurred.

 

Unless we state otherwise in the applicable prospectus supplement, if an event of default with respect to any debt securities has occurred and is continuing, then either the trustee or the holders of at least 25% of the principal amount specified in the indenture or any supplemental indenture of the outstanding debt securities may declare the principal of all the affected debt securities and interest accrued to be due and payable immediately.

 

Unless we state otherwise in the applicable prospectus supplement, if an event of default with respect to any debt securities has occurred and is continuing and is due to a bankruptcy, insolvency or reorganization event relating to us, then the principal (or such portion of the principal as is specified in the terms of the debt securities) of and interest accrued on all debt securities then outstanding will become due and payable automatically, without further action by the trustee or the holders.

 

Under conditions specified in the indenture and any supplemental indenture, the holders of a majority of the principal amount of the debt securities may annul or waive certain declarations and defaults described above. These holders may not, however, waive a continuing default in payment of principal of (or premium, if any) or interest on the debt securities.

The indenture may provide that, subject to the duty of the trustee during a default to act with the required standard of care, the trustee will have no obligation to exercise any right or power granted to it under the indenture at the request of holders of debt securities unless the holders have indemnified the trustee. Subject to the provisions in the indenture and any supplemental indenture for the indemnification of the trustee and other limitations specified in those documents, the holders of a majority in principal amount of the outstanding debt securities may direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee relating to the debt securities.

 

If you hold debt securities, you will not be permitted under the terms of the indenture or any supplemental indenture to institute any action against us in connection with any default (except actions for payment of overdue principal, premium, or interest or other amounts) unless:

 

 

Defeasance Provisions Applicable to the Debt Securities

 

Unless otherwise specified in a prospectus supplement, under the indenture or any supplemental indenture, we, at our option,

 

 

In each case, if we irrevocably deposit, in trust with the trustee, money or U.S. government obligations which through the payment of interest and principal will provide money sufficient to pay all the principal of, and interest and premium, if any, on, the debt securities on the dates on which such payments are due. We must also specify whether the debt securities are being defeased to maturity or to a particular redemption date.

 

To exercise either of the above options, no default or event of default shall have occurred or be continuing on the date of such deposit, and such defeasance must not result in a breach of or constitute a default under any material agreement to which we are bound. Unless otherwise specified in a prospectus supplement, we also must deliver a certificate stating that the deposit was not made with the intent of preferring holders of the debt securities over our other creditors. In addition, we must deliver to the trustee an opinion of counsel that:

 

 

Modification and Waiver

 

We and the trustee may, without the consent of holders, modify provisions of the indenture for certain purposes, including, among other things, curing ambiguities and maintaining the qualification of the indenture under the

Trust Indenture Act. Under the indenture, our rights and obligations and the rights of holders may be modified with the consent of the holders of a majority in aggregate principal amount of the outstanding debt securities affected by the modification. However, unless indicated otherwise in the applicable prospectus supplement, the provisions of the indenture may not be modified without the consent of each holder of debt securities affected thereby if the modification would:

 

 

The Trustee

 

We will include information regarding the trustee in the prospectus supplement relating to any series of debt securities. If any event of default shall occur (and be continuing) under the indenture or any supplemental indenture, the trustee will be required to use the degree of care and skill of a prudent man in the conduct of his own affairs. The trustee will be under no obligation to exercise any of its powers at the request of any of the holders of the debt securities, unless the holders shall have offered the trustee reasonable indemnity against the costs, expenses and liabilities it might incur. The indenture, any supplemental indenture, and the provisions of the Trust Indenture Act incorporated by reference thereby, will contain limitations on the rights of the trustee, should it become a creditor of ours, to obtain payment of claims or to realize on property received by it for claims as security or otherwise.

 

We summarize below some of the provisions that will apply to the warrants unless the applicable prospectus supplement provides otherwise. The summary may not contain all information that is important to you. The complete terms of the warrants will be contained in the applicable warrant certificate and warrant agreement. These documents have been or will be included or incorporated by reference as exhibits to the registration statement of which this prospectus is a part. You should read the warrant certificate and the warrant agreement. You should also read the prospectus supplement, which will contain additional information and which may update or change some of the information below.

 

General

 

We may issue warrants to purchase common stock independently or together with other securities. The warrants may be attached to or separate from the other securities. We may issue warrants in one or more series. Each series of warrants will be issued under a separate warrant agreement to be entered into between us and a warrant agent. The warrant agent will be our agent and will not assume any obligations to any holder or beneficial owner of the warrants.

 

The prospectus supplement and the warrant agreement relating to any series of warrants will include specific terms of the warrants. These terms include the following:

 

 

The warrants will be represented by certificates. The warrants may be exchanged under the terms outlined in the warrant agreement. We will not charge any service charges for any transfer or exchange of warrant certificates, but we may require payment for tax or other governmental charges in connection with the exchange or transfer. Unless the prospectus supplement states otherwise, until a warrant is exercised, a holder will not be entitled to any payments on or have any rights with respect to the common stock issuable upon exercise of the warrant.

 

Exercise of Warrants

 

To exercise the warrants, the holder must provide the warrant agent with the following:

 

 

If a warrant holder exercises only part of the warrants represented by a single certificate, the warrant agent will issue a new warrant certificate for any warrants not exercised. Unless the prospectus supplement states otherwise, no fractional shares will be issued upon exercise of warrants, but we will pay the cash value of any fractional shares otherwise issuable.

 

The exercise price and the number of shares of common stock for which each warrant can be exercised will be adjusted upon the occurrence of events described in the warrant agreement, including the issuance of a common stock dividend or a combination, subdivision or reclassification of common stock. Unless the prospectus supplement states otherwise, no adjustment will be required until cumulative adjustments require an adjustment of at least 1%. From time to time, we may reduce the exercise price as may be provided in the warrant agreement.

 

Unless the prospectus supplement states otherwise, if we enter into any consolidation, merger, or sale or conveyance of our property as an entirety, the holder of each outstanding warrant will have the right to acquire the kind and amount of shares of stock, other securities, property or cash receivable by a holder of the number of shares of common stock into which the warrants were exercisable immediately prior to the occurrence of the event.

 

Modification of the Warrant Agreement

 

The common stock warrant agreement will permit us and the warrant agent, without the consent of the warrant holders, to supplement or amend the agreement in the following circumstances:

 

 

Offering and Sale of Securities

 

We may sell the securities from time to time as follows:

 

 

In some cases, we or dealers acting with us may also purchase securities and reoffer them to the public by one or more of the methods described above. This prospectus may be used in connection with any offering of our securities through any of these methods or other methods described in the applicable prospectus supplement.

 

The securities we distribute by any of these methods may be sold to the public, in one or more transactions, either:

 

 

We may solicit offers to purchase securities directly from the public from time to time. We may also designate agents from time to time to solicit offers to purchase securities from the public on our behalf. The prospectus supplement relating to any particular offering of securities will name any agents designated to solicit offers, and will include information about any commissions we may pay the agents, in that offering. Agents may be deemed to be “underwriters” as that term is defined in the Securities Act.

 

From time to time, we may sell securities to one or more dealers acting as principals. The dealers, who may be deemed to be “underwriters” as that term is defined in the Securities Act, may then resell those securities to the public.

 

We may sell securities from time to time to one or more underwriters, who would purchase the securities as principal for resale to the public, either on a firm-commitment or best-efforts basis. If we sell securities to underwriters, we may execute an underwriting agreement with them at the time of sale and will name them in the applicable prospectus supplement. In connection with those sales, underwriters may be deemed to have received compensation from us in the form of underwriting discounts or commissions and may also receive commissions from purchasers of the securities for whom they may act as agents. Underwriters may resell the securities to or through dealers, and those dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from purchasers for whom they may act as agents. The applicable prospectus supplement will include any required information about underwriting compensation we may pay to underwriters, and any discounts, concessions or commissions underwriters allow to participating dealers, in connection with an offering of securities.

 

We may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of stock, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of stock. The third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be identified in the applicable prospectus supplement (or a post-effective amendment).

If we offer securities in a subscription rights offering to our existing security holders, we may enter into a standby underwriting agreement with dealers, acting as standby underwriters. We may pay the standby underwriters a commitment fee for the securities they commit to purchase on a standby basis. If we do not enter into a standby underwriting arrangement, we may retain a dealer-manager to manage a subscription rights offering for us.

 

We may authorize underwriters, dealers and agents to solicit from third parties offers to purchase securities under contracts providing for payment and delivery on future dates. The applicable prospectus supplement will describe the material terms of these contracts, including any conditions to the purchasers’ obligations, and will include any required information about commissions we may pay for soliciting these contracts.

 

Underwriters, dealers, agents and other persons may be entitled, under agreements that they may enter into with us to indemnification by us against certain liabilities, including liabilities under the Securities Act.

 

In connection with any underwritten offering, the underwriters may purchase and sell shares of common stock in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Shorts sales involve the sale by the underwriters of a greater number of shares than they are required to purchase in the offering. “Covered” short sales are sales made in an amount not greater than the underwriters’ option to purchase additional shares from us in the offering. The underwriters may close out any covered short position by either exercising their option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to close out the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the overallotment option. “Naked” short sales are any sales in excess of such option. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing transactions consist of various bids for or purchases of common stock made by the underwriters in the open market prior to the completion of the offering.

 

The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions.

 

Purchases to cover a short position and stabilizing transactions may have the effect of preventing or retarding a decline in the market price of our common stock, and together with the imposition of the penalty bid, may stabilize, maintain or otherwise affect the market price of the common stock. As a result, the price of the common stock may be higher than the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued at any time. These transactions may be effected on the Nasdaq National Market, in the over-the-counter market or otherwise.

 

Matters Relating to the Offering and Market-Making Resales

 

Each series of securities will be a new issue, and there will be no established trading market for any security prior to its original issue date. Other than our common stock, we may not list any particular series of securities on a securities exchange or quotation system. Any underwriters to whom we sell securities for public offering may also make a market in those securities. However, no underwriter that makes a market is obligated to do so, and any of them may stop doing so at any time without notice. No assurance can be given as to the liquidity or trading market for any of the securities.

 

Unless otherwise indicated in the applicable prospectus supplement or confirmation of sale, the purchase price of the securities will be required to be paid in immediately available funds in New York City.

 

In this prospectus, the terms “this offering” means the initial offering of the securities made in connection with their original issuance by GulfMark. This term does not refer to any subsequent resales of securities in market-making transactions.

 

Strasburger & Price, L.L.P., Houston, Texas, will pass upon certain legal matters relating to the validity of our common stock, preferred stock, debt securities and warrants.

 

The consolidated financial statements of GulfMark Offshore, Inc. and subsidiaries as of December 31, 2004 and for each of the two years in the period ended December 31, 2004 appearing in GulfMark Offshore, Inc.’s Annual Report (Form 10-K) for the year ended December 31, 2005, have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their report thereon, included therein, and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

 

On May 23, 2005, we notified E&Y that we had dismissed E&Y as our independent registered public accounting firm. On May 24, 2005, our Audit Committee of the Board of Directors appointed UHY Mann Frankfort Stein & Lipp CPAs, LLP as our independent registered public accounting firm for the year ending December 31, 2005.

 

The consolidated financial statements as of December 31, 2005, and the related consolidated statements of operations, stockholders’ equity, comprehensive income, and cash flows for the year then ended incorporated in this prospectus by reference to our Annual Report on Form 10-K for the year ended December 31, 2005, and our management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2005 included therein have been so audited by UHY Mann Frankfort Stein & Lipp CPAs, LLP, an independent public accounting firm, as set forth in their reports included therein and incorporated by reference in reliance upon such reports given on the authority of said firm as experts in auditing and accounting.

 

 

2,000,000 Shares

 

GulfMark Offshore, Inc.

 

Common Stock

 

Prospectus Supplement

 

Jefferies & Company

 

December 4, 2006