Twelfth Amendment to Second Amended and Restated Credit Agreement by and among Key Energy Services, Inc., PNC Bank, and Lenders

Summary

This amendment updates the existing credit agreement between Key Energy Services, Inc., PNC Bank (as Administrative Agent), and other lenders. It allows Key Energy Services to issue up to $325 million in senior notes, including both 2001 Senior Notes and new Future Senior Notes, under certain conditions. The amendment confirms that all other terms of the original credit agreement remain in effect. The amendment becomes effective once all required parties sign and certain conditions are met, including the absence of any default.

EX-10.2 6 a2072103zex-10_2.txt EXHIBIT 10.2 Exhibit 10.2 TWELFTH AMENDMENT TO CREDIT AGREEMENT (TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT) THIS TWELFTH AMENDMENT TO CREDIT AGREEMENT (the "Twelfth Amendment") is dated as of February 21, 2002 and is made by and among KEY ENERGY SERVICES, INC. (formerly known as Key Energy Group, Inc.), a Maryland corporation (the "Borrower"), the LENDERS (as defined in the Credit Agreement), PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent (the "Administrative Agent"), NORWEST BANK TEXAS, N.A., as Collateral Agent and PNC CAPITAL MARKETS, INC., as Arranger. WITNESSETH: WHEREAS, the Borrower, the Lenders, the Administrative Agent, the Collateral Agent and the Arranger are party to that certain Second Amended and Restated Credit Agreement, dated as of June 6, 1997, as amended and restated through September 14, 1998, and as amended by the First Amendment dated as of November 19, 1998, the Second Amendment dated as of December 29, 1998, the Third Amendment dated as of April 8, 1999, the Fourth Amendment dated as of April 15, 1999, the Fifth Amendment dated as of May 10, 1999, the Sixth Amendment dated as of July 14, 1999, the Seventh Amendment dated as of March 1, 2000, the Eighth Amendment and Consent dated as of February 21, 2001, the Ninth Amendment dated as of September 17, 2001, the Tenth Amendment dated as of December 13, 2001, and the Eleventh Amendment dated as of February 21, 2002 (as amended, restated, supplemented or modified, the "Credit Agreement"); WHEREAS, in connection with the issuance of the Future Senior Notes, the holders of the 2001 Senior Notes will be given the opportunity to exchange 2001 Senior Notes for other senior notes issued pursuant to Future Senior Notes Indentures which are identical, in all material respects, to the Future Senior Notes; WHEREAS, the Future Senior Notes are to be issued on terms identical, in all material respects, to the terms of the 2001 Senior Notes; WHEREAS, the Borrower has requested that the Credit Agreement be amended to reflect that issuance of up to $325,000,000 of senior notes pursuant to the Future Senior Notes Indenture will be permitted by the Credit Agreement so long as the sum of the 2001 Senior Notes and all senior notes to be issued pursuant to the Future Senior Notes Indenture do not exceed $325,000,000; and WHEREAS, capitalized terms used herein shall have the meanings given to them in the Credit Agreement. NOW, THEREFORE, the parties hereto and in consideration of their mutual covenants and agreements hereinafter set forth and intending to be legally bound hereby, covenant and agree as follows: 1. AMENDMENT TO SECTION 1.1 [DEFINED TERMS]. The defined term "Future Senior Notes" is hereby amended and restated as follows: "FUTURE SENIOR NOTES": senior notes to be issued by the Borrower in an aggregate principal amount not to exceed $150,000,000, with a maturity of March 1, 2008 or later and with an interest rate not to exceed 9.0%; provided, however, that such principal amount may be increased dollar for dollar by the aggregate principal amount of 2001 Senior Notes which are exchanged for senior notes of the same series issued pursuant to the Future Senior Notes Indenture; provided, further, that in no event may the aggregate outstanding principal amount of the 2001 Senior Notes and the Future Senior Notes at any time exceed $325,000,000. 2. REPRESENTATIONS AND WARRANTIES. The Borrower represents and warrants to the Administrative Agent and the Lenders that, by its execution and delivery hereof to the Administrative Agent, as of the Effective Date, after giving effect to this Twelfth Amendment, no Default or Event of Default has occurred and is continuing, and the representations and warranties made by the Borrower and the other Loan Parties in or pursuant to the Credit Agreement or any Loan Documents are true and correct in all material respects on and as of the Effective Date as if made on such date (except to the extent that any such representations and warranties expressly relate to an earlier date, in which case such representations and warranties were true and correct in all material respects on and as of such earlier date). 3. CONDITIONS TO EFFECTIVENESS OF THIS TWELFTH AMENDMENT. This Twelfth Amendment shall become effective on the date on which the following conditions have occurred (the "Effective Date"): (a) the Administrative Agent shall have received a copy of this Twelfth Amendment duly executed and delivered by a duly authorized officer of the Borrower, the Required Lenders and the Administrative Agent, (b) the Administrative Agent shall have received the Acknowledgment and Consent, attached hereto as EXHIBIT A, executed and delivered by a duly authorized officer of each of the signatories thereto, (c) no Default or Event of Default shall exist and be continuing, and (d) the Administrative Agent shall have received such other corporate documents and resolutions as the Administrative Agent may reasonably request. 4. MISCELLANEOUS. (a) CONTINUING EFFECT OF THE CREDIT AGREEMENT. This Twelfth Amendment shall not constitute an amendment or waiver of or consent to any provision of the Credit Agreement not expressly referred to herein and shall not be construed as an amendment, waiver or consent to any action on the part of the Borrower that would require an amendment, waiver or consent of the Agents or the Lenders except as expressly stated herein. Except as expressly consented to hereby, the provisions of the Credit Agreement and the other Loan Documents are and shall remain in full force and effect. (b) FEES AND EXPENSES. The Borrower agrees to pay or reimburse the Administrative Agent on demand for all its reasonable out-of-pocket costs and expenses incurred in connection with the preparation and execution of this Amendment, including, without limitation, the reasonable fees and disbursements of counsel to the Administrative Agent. (c) COUNTERPARTS. This Twelfth Amendment may be executed in any number of counterparts (including by telecopy) by the parties hereto, each of which counterparts when so executed shall be an original, but all counterparts taken together shall constitute one and the same instrument. (d) GOVERNING LAW. THIS TWELFTH AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS TWELFTH AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK] [SIGNATURE PAGE 1 OF 7 TO TWELFTH AMENDMENT TO CREDIT AGREEMENT] (TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT)] IN WITNESS WHEREOF, the parties hereto have caused this Twelfth Amendment to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written. KEY ENERGY SERVICES, INC. (formerly known as Key Energy Group, Inc.) By: /s/ Jack D. Loftis, Jr. -------------------------------- Title: Sr. VP & General Counsel ------------------------------ PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent and as a Lender By: /s/ Janis L. Tucker -------------------------------- Title: Vice President ------------------------------ [SIGNATURE PAGE 2 OF 7 TO TWELFTH AMENDMENT TO CREDIT AGREEMENT] (TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT)] BANK POLSKA KASA OPIEKI S.A., PEKAO S.A. GROUP, NEW YORK BRANCH By: ------------------------------ Title: ------------------------------ [SIGNATURE PAGE 3 OF 7 TO TWELFTH AMENDMENT TO CREDIT AGREEMENT] (TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT)] BANK LEUMI, USA By: ------------------------------ Title: ------------------------------ [SIGNATURE PAGE 4 OF 7 TO TWELFTH AMENDMENT TO CREDIT AGREEMENT] (TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT)] BEAR STEARNS INVESTMENT PRODUCT INC. By: /s/ Keith C. Barnish -------------------------------- Title: Authorized Signatory ------------------------------ BEAR STEARNS CORPORATE LENDING INC. By: /s/ Keith C. Barnish -------------------------------- Title: Executive Vice President ------------------------------ [SIGNATURE PAGE 5 OF 7 TO TWELFTH AMENDMENT TO CREDIT AGREEMENT] (TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT)] ML CLO XV PILGRIM AMERICA (CAYMAN) LTD. By: Pilgrim Investments, Inc., as its Investment Manager By: ------------------------------ Title: ------------------------------ PILGRIM PRIME RATE TRUST By: Pilgrim Investments, Inc., as its Investment Manager] By: ------------------------------ Title: ------------------------------ [SIGNATURE PAGE 6 OF 7 TO TWELFTH AMENDMENT TO CREDIT AGREEMENT] (TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT)] LEHMAN COMMERCIAL PAPER, INC. By: ------------------------------ Title: ------------------------------ [SIGNATURE PAGE 7 OF 7 TO TWELFTH AMENDMENT TO CREDIT AGREEMENT] (TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT)] GENERAL ELECTRIC CAPITAL CORPORATION By: ------------------------------ Title: ------------------------------ EXHIBIT A ACKNOWLEDGMENT AND CONSENT ACKNOWLEDGMENT AND CONSENT Each of the undersigned corporations, as a guarantor under that certain Amended and Restated Master Guarantee and Collateral Agreement, dated as of June 6, 1997, as amended and restated through September 14, 1998 (as amended, supplemented or otherwise modified from time to time, the "Guarantee"), made by each of such corporations in favor of the Collateral Agent, acknowledges the foregoing amendment and waiver and confirms and agrees that the Guarantee is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects and the Guarantee and all of the Collateral (as defined in the Guarantee) do, and shall continue to, secure the payment of all of the Obligations (as defined in the Guarantee) pursuant to the terms of the Guarantee. Capitalized terms not otherwise defined herein shall have the meanings assigned to them in the Credit Agreement referred to in the Twelfth Amendment to Credit Agreement to which this Acknowledgment and Consent is attached. YALE E. KEY, INC. KEY ENERGY DRILLING, INC. WELLTECH EASTERN, INC. ODESSA EXPLORATION INCORPORATED KALKASKA OILFIELD SERVICES, INC. WELL-CO OIL SERVICE, INC. PATRICK WELL SERVICE, INC. MOSLEY WELL SERVICE, INC. RAM OIL WELL SERVICE, INC. ROWLAND TRUCKING CO., INC. LANDMARK FISHING & RENTAL, INC. DUNBAR WELL SERVICE, INC. FRONTIER WELL SERVICE, INC. KEY ROCKY MOUNTAIN, INC. KEY FOUR CORNERS, INC. JETER SERVICE CO. JETER WELL SERVICE, INC. JETER TRANSPORTATION, INC. INDUSTRIAL OILFIELD SUPPLY, INC. BROOKS WELL SERVICING, INC. UPDIKE BROTHERS, INC. J.W. GIBSON WELL SERVICE COMPANY KEY ENERGY SERVICES-SOUTH TEXAS, INC. WATSON OILFIELD SERVICE & SUPPLY, INC. WELLTECH MID-CONTINENT, INC. DAWSON PRODUCTION MANAGEMENT, INC. DAWSON PRODUCTION ACQUISITION CORP. DAWSON PRODUCTION TAYLOR, INC. KEY ENERGY SERVICES-CALIFORNIA, INC. By: /s/ Jack D. Loftis, Jr. -------------------------------- Title: Vice President ------------------------------ DAWSON PRODUCTION PARTNERS, L.P. By: DAWSON PRODUCTION MANAGEMENT, INC., its sole general partner By: /s/ Jack D. Loftis, Jr. -------------------------------- Title: Vice President ------------------------------