CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE IT IS NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE COMPANY IF PUBLICLY DISCLOSED.
This FORBEARANCE AGREEMENT (this Agreement), dated as of October 29, 2019, to that certain Loan and Security Agreement, dated as of December 15, 2016 (as amended, restated, supplemented or otherwise modified from time to time, the Loan Agreement), by and among Key Energy Services, Inc., a Delaware corporation (the Company), Key Energy Services, LLC, a Texas limited liability company (Key Energy LLC, and together with the Company, collectively, Borrowers or Borrower), the Lenders party thereto from time to time (collectively, the Lenders), and Bank of America, N.A., a national banking association, as administrative agent for the Lenders (in such capacity, the Administrative Agent). Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Loan Agreement.
WHEREAS, Borrowers, the Lenders and the Administrative Agent are parties to the Loan Agreement;
WHEREAS, the Company has not made the interest payment due on October 18, 2019 in a timely manner in accordance with the Term Loan Credit Agreement;
WHEREAS, the failure to make such payment gave rise to an immediate Event of Default pursuant to Section 12.1(f) of the Loan Agreement (collectively, the Specified Defaults);
WHEREAS, Borrowers have requested that during the Forbearance Period (as hereinafter defined), the Administrative Agent and the Lenders party hereto (sometimes referred to herein individually as a Lender Party, and collectively as the Lender Parties) agree to forbear from exercising any of their Default or Event of Default related rights and remedies against Borrowers and the other Loan Parties solely with respect to the Specified Defaults in accordance herewith that would otherwise be exercisable by the Lender Parties but for this Agreement; and
WHEREAS, subject to the terms and conditions set forth herein, the Lender Parties are willing to agree to such a forbearance but only on the terms and conditions contained in this Agreement.
NOW, THEREFORE, in consideration of the foregoing, the terms, covenants and conditions contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1. Confirmation by Borrowers of Specified Defaults. Each Borrower acknowledges and agrees that (i) the Specified Defaults constitute an Event Default on October 18, 2019 and (ii) no Events of Default or Defaults (other than the Specified Defaults) have occurred and are continuing as of the date hereof.
SECTION 2. Amounts Owing. Each Obligor acknowledges and agrees that, as of the date hereof, the aggregate amount of LC Obligations under the Loan Agreement is $34,569,949, plus accrued and unpaid interest and fees related thereto. Such Obligations, together with all other outstanding Obligations owing pursuant to the terms of the Loan Documents, including interest, fees, expenses and other charges, are validly owing and are not subject to any right of offset, deduction, claim, or counterclaim in favor of any Obligor.