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EXHIBIT 99.4
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DEBT REGISTRATION RIGHTS AGREEMENT
among
KEY ENERGY GROUP, INC.
THE GUARANTORS listed on the signature pages hereto as Guarantors
and
XXXXXX COMMERCIAL PAPER INC.
Dated as of September 14, 1998
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DEBT REGISTRATION RIGHTS AGREEMENT
This DEBT REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") is made
and entered into as of September 14, 1998, among KEY ENERGY GROUP, INC., a
Maryland corporation (the "COMPANY"), the Guarantors listed on signature pages
hereto (the "GUARANTORS") and XXXXXX COMMERCIAL PAPER INC., as ("ADMINISTRATIVE
AGENT").
RECITALS
This Agreement is made pursuant to the Bridge Loan Agreement, dated
as of the date hereof (the "BRIDGE LOAN AGREEMENT"), among the Company, the
Guarantors, the Lenders referred to therein (the "LENDERS"), Xxxxxx Brothers
Inc. (the "ARRANGER") and the Administrative Agent. In order to induce the
Lenders to enter into the Bridge Loan Agreement, the Company and the Guarantors
have agreed to provide the registration rights set forth in this Agreement. The
execution of this Agreement is a condition to the effectiveness of the Bridge
Loan Agreement.
AGREEMENT
The parties agree as follows:
1. Definitions
Capitalized terms used herein without definition have the meanings
assigned to them in the Bridge Loan Agreement. As used in this Agreement, the
following capitalized terms shall have the following meanings:
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
EXCHANGE NOTE INDENTURE: The Indenture, dated as of September 14,
1998, among the Company, the Guarantors, as guarantors and The Bank of New York,
as trustee, pursuant to which the Exchange Notes are issued, as the same may be
amended from time to time in accordance with the terms thereof.
EXCHANGE NOTES: The Exchange Notes issued pursuant to the Exchange
Note Indenture in the form attached as Exhibit A to the Exchange Note Indenture.
LIQUIDATED DAMAGES: See Section 3(b) hereof.
LOANS: As defined in the Bridge Loan Agreement.
NASD: National Association of Securities Dealers, Inc.
PERSON: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
PROSPECTUS: The prospectus included in any Registration Statement,
as amended or supplemented by any prospectus supplement with respect to the
terms of the offering of any portion of the Registrable Securities covered by
such Registration Statement and by all other amendments and supplements to the
prospectus, including post-effective amendments and all material incorporated by
reference in such prospectus.
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REGISTRABLE SECURITIES: All Exchange Notes; provided that an
Exchange Note ceases to be a Registrable Security when it is no longer a
Transfer Restricted Security.
REGISTRANTS: The Company and the Guarantors.
REGISTRATION DEFAULT: See Section 3(b) hereof.
REGISTRATION EXPENSES: See Section 6 hereof.
REGISTRATION STATEMENT: Any registration statement of the
Registrants which covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such Registration Statement, including post-effective amendments,
all exhibits and all material incorporated by reference in such Registration
Statement.
RULE 144: Rule 144 promulgated under the Securities Act..
SEC: The Securities and Exchange Commission.
SECURITIES ACT: The Securities Act of 1933, as amended.
SHELF REGISTRATION: See Section 3(a) hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of the Exchange Note Indenture.
TRANSFER RESTRICTED SECURITIES: The Registrable Securities upon
original issuance thereof, and with respect to any particular such Registrable
Security, until such securities are sold to the public.
UNDERWRITTEN REGISTRATION or UNDERWRITTEN OFFERING: A registration
in which securities of the Company are sold to an underwriter for reoffering to
the public.
2. Holders of Registrable Securities
A Person is deemed to be a holder of Registrable Securities whenever
such Person owns Registrable Securities of record or has provided evidence
reasonably satisfactory to the Company that such Person has the right to acquire
such Registrable Securities, whether or not such acquisition has actually been
effected and disregarding any legal restrictions upon the exercise of such
right.
3. Shelf Registration
(a) Filing of Shelf Registration. The Registrants shall use its
reasonable best efforts to file a "shelf" registration statement on any
appropriate form pursuant to Rule 415 (or similar rule that may be adopted by
the SEC) under the Securities Act (a "SHELF REGISTRATION") as promptly as
practicable and in no event later than the date that is 300 days following the
initial making of the Loans (the "FILING DATE") to permit resales of all of the
Registrable Securities. The Registrants agree to use their reasonable best
efforts to cause such Shelf Registration to become effective as promptly as
possible after the filing thereof, but in no event later than 60 days after the
Filing Date (the "EFFECTIVE DATE"), and thereafter to keep it continuously
effective for the period that will terminate upon the earlier of (1) when all
the Registrable Securities covered by the Shelf Registration have been sold
pursuant to such Shelf Registration or have been sold to the public pursuant to
Rule 144 and (2) no Registrable Securities or Loans are outstanding.
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(b) Liquidated Damages. If (i) the Registration Statement has not
been declared effective by the SEC on or prior to the Effective Date or (ii) the
Registration Statement is filed and declared effective but shall thereafter
cease to be effective or fail to be usable for its intended purpose at any time
within the time period required for effectiveness in subsection (a) above
without being succeeded immediately by a post-effective amendment to the
Registration Statement that cures such failure and that is itself immediately
declared effective (each such event referred to in clauses (i) and (ii), a
"REGISTRATION DEFAULT"), the Registrants jointly and severally agree to pay
liquidated damages ("LIQUIDATED DAMAGES") to each holder of Transfer Restricted
Securities and each Lender equal to $0.05 per week per $1,000 principal amount
of Transfer Restricted Securities held by such holder or Lender for each week or
portion thereof that the Registration Default continues for the first 90-day
period immediately following the occurrence of such Registration Default. The
amount of the liquidated damages shall increase by an additional $0.05 per week
per $1,000 principal amount of Transfer Restricted Securities with respect to
each subsequent 90-day period until all Registration Defaults have been cured,
up to a maximum amount of liquidated damages of $0.20 per week per $1,000
principal amount of Transfer Restricted Securities; provided that the Company
shall in no event be required to pay liquidated damages for more than one
Registration Default at any given time. All Liquidated Damages shall be
calculated based on the actual number of days elapsed and a 360 day year and all
accrued Liquidated Damages shall be paid to each record holder of Registrable
Securities in cash, except if the interest rate on the Exchange Notes exceeds
14.0%, Liquidated Damages shall be paid in the form of additional Registrable
Securities having a principal amount equal to the amount of such Liquidated
Damages; provided that such additional Registrable Securities shall be in
denominations of $1,000 and integral multiples thereof and that any difference
between such Liquidated Damages owing and such additional Registrable Securities
shall be paid in cash by wire transfer of immediately available funds or by
federal funds check on each Interest Payment Date, as provided in the Exchange
Note Indenture or the Bridge Loan Agreement, as applicable. Following the cure
of all Registration Defaults relating to any particular Registrable Security,
the accrual of Liquidated Damages with respect to such Registration Default will
cease.
All obligations of the Registrants set forth in the preceding
paragraph that are outstanding with respect to any Transfer Restricted Security
at the time such security ceases to be a Transfer Restricted Security shall
survive until such time as all such obligations have been paid in full. Any
holder of Registrable Securities may notify the Exchange Note Indenture trustee
(and any paying agent under the Exchange Note Indenture) and the Administrative
Agent under the Bridge Loan Agreement immediately after the occurrence of each
and every event which pursuant to this Section 3(b) results in the accrual of
Liquidated Damages with respect to such Registrable Securities.
4. Hold-Back Agreements
(a) Restrictions on Public Sale by Holder of Registrable
Securities. Each holder of Registrable Securities whose Registrable Securities
are covered by a Registration Statement filed pursuant to Section 3 hereof
agrees, if requested by the managing underwriters in an underwritten offering,
not to effect any public sale or distribution of securities of the Registrants
of the same class as the securities included in such Registration Statement,
including a sale pursuant to Rule 144 under the Securities Act (except as part
of such underwritten registration), during the 10-day period prior to, and
during the 90-day period beginning on, the closing date of each underwritten
offering made pursuant to such Registration Statement, to the extent timely
notified in writing by the Registrants or the managing underwriters; provided,
however, that each holder of Registrable Securities shall be subject to the
hold-back restrictions of this Section 4(a) only once during the term of this
Agreement.
The foregoing provisions shall not apply to any holder of
Registrable Securities if such holder is
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prevented by applicable statute or regulation from entering any such agreement;
provided, however, that any such holder shall undertake, in its request to
participate in any such underwritten offering, not to effect any public sale or
distribution of any Registrable Securities held by such holder and covered by a
Registration Statement commencing on the date of sale of the Registrable
Securities covered by such Registration Statement unless it has provided 90 days
prior written notice of such sale or distribution to the underwriter or
underwriters.
(b) Restrictions on Sale of Securities by the Registrants and
Others. The Registrants agree (1) not to effect any public or private offer,
sale or distribution of any of their debt securities or any class or series of
their capital stock having a preference in liquidation or with respect to
dividends, including a sale pursuant to Regulation D under the Securities Act,
during the 10-day period prior to, and during the 90-day period beginning with,
the effectiveness of a Registration Statement filed under Section 3 to the
extent timely notified in writing by a holder of Registrable Securities or the
managing underwriters in an underwritten offering and (2) to use reasonable best
efforts to cause each holder of each of the Registrants' privately placed debt
securities or any class or series of the Registrants' capital stock having a
preference in liquidation or with respect to dividends purchased from the
Registrants at any time on or after the date of this Agreement to agree not to
effect any public sale or distribution of any such securities during such
period, including a sale pursuant to Rule 144 under the Securities Act (except
as part of such registration, if permitted).
5. Registration Procedures
In connection with the Registrants' Shelf Registration obligations
set forth in Section 3 hereof, each of the Registrants will use its reasonable
best efforts to effect such registration to permit the sale of such Registrable
Securities in accordance with the intended method or methods of distribution
thereof, and pursuant thereto the Registrants will, as expeditiously as
possible:
(a) prepare and file with the SEC, within the time period provided
in Section 3 hereof, a Registration Statement or Registration Statements
relating to the Shelf Registration on any appropriate form under the Securities
Act, which form shall be available for the sale of the Registrable Securities in
accordance with the intended method or methods of distribution thereof and shall
include all financial statements (including, if applicable, financial statements
of any Person which shall have guaranteed any indebtedness of the Registrants)
required by the SEC to be filed therewith, cooperate and assist in any filings
required to be made with the NASD and in the performance of any due diligence
investigation by any underwriter (including any "qualified independent
underwriter") that is required to be retained in accordance with the rules and
regulations of the NASD, and use its reasonable best efforts to cause such
Registration Statement to become effective; provided that before filing a
Registration Statement or any amendments or supplements thereto, the Registrants
will furnish to the holders of the Registrable Securities covered by such
Registration Statement and the underwriters, if any, copies of all such
documents proposed to be filed, which documents will be subject to the review by
such holders and underwriters, and the Registrants will not file any
Registration Statement or any amendments or supplements thereto to which the
holders of a majority in aggregate principal amount of such Registrable
Securities or such managing underwriters, if any, shall reasonably object within
14 days;
(b) prepare and file with the SEC such amendments and post-
effective amendments to the Registration Statement as may be necessary to keep
the Registration Statement effective for the applicable period, or such shorter
period as will terminate when all Registrable Securities covered by such
Registration Statement have been sold; cause the Prospectus to be supplemented
by any required Prospectus supplement, and as so supplemented to be filed
pursuant to Rule 424 under the Securities Act;
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comply with the applicable provisions of Rules 424 and 430A under the Securities
Act in a timely manner; and comply with the provisions of the Securities Act
with respect to the disposition of all Registrable Securities covered by such
Registration Statement during the applicable period in accordance with the
intended method or methods of distribution by the sellers thereof set forth in
such Registration Statement or supplement to the Prospectus;
(c) notify the selling holders of Registrable Securities and the
managing underwriters, if any, promptly, and (if requested by any such Person)
confirm such advice in writing, (1) when the Prospectus or any Prospectus
supplement or post-effective amendment has been filed, and, with respect to the
Registration Statement or any post-effective amendment, when the same has become
effective, (2) of any request by the SEC for amendments or supplements to the
Registration Statement or the Prospectus or for additional information, (3) of
the issuance by the SEC of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that purpose,
(4) if at any time the representations and warranties of the Registrants
contemplated by paragraph (o) below cease to be true and correct, (5) of the
receipt by the Registrants of any notification with respect to the suspension of
the qualification of the Registrable Securities for sale in any jurisdiction or
the initiation or threatening of any proceeding for such purpose and (6) of the
happening of any event or the existence of any fact which makes any statement
made in the Registration Statement, the Prospectus or any document incorporated
therein by reference untrue or which requires the making of any changes in the
Registration Statement, the Prospectus or any document incorporated therein by
reference in order to make the statements therein not misleading. If at any time
the Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, or any state securities commission or other regulatory
authority shall issue an order suspending the qualification or exemption from
qualification of the Transfer Restricted Securities under state securities or
Blue Sky laws, the Registrants shall use their reasonable best efforts to obtain
the withdrawal or lifting of such order at the earliest possible time;
(d) make every reasonable effort to obtain the withdrawal of any
order suspending the effectiveness of the Registration Statement at the earliest
possible moment;
(e) if requested by the managing underwriter or underwriters or a
holder of Registrable Securities being sold in connection with an underwritten
offering, promptly incorporate in a Prospectus supplement or post-effective
amendment such information as the managing underwriters or the holders of a
majority in aggregate principal amount of the Registrable Securities being sold
agree should be included therein relating to the plan of distribution with
respect to such Registrable Securities, including, without limitation,
information with respect to the principal amount of Registrable Securities being
sold to such underwriters, the purchase price being paid therefor by such
underwriters and any other terms of the underwritten (or best efforts
underwritten) offering of the Registrable Securities to be sold in such
offering; and make all required filings of such Prospectus supplement or
post-effective amendment as soon as notified of the matters to be incorporated
in such Prospectus supplement or post-effective amendment;
(f) furnish to each selling holder of Registrable Securities and
each managing underwriter, if any, without charge, if requested, at least one
signed copy of the Registration Statement and any post-effective amendment
thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including those
incorporated by reference);
(g) deliver to each selling holder of Registrable Securities and
the underwriters, if any, without charge, if requested, as many copies of the
Prospectus (including each preliminary prospectus) and any amendment or
supplement thereto as such Persons may reasonably request; the Registrants
consent to the use of the Prospectus or any amendment or supplement thereto by
each of the selling holders of Registrable
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Securities and the underwriters, if any, in connection with the offering and
sale of the Registrable Securities covered by the Prospectus or any amendment or
supplement thereto;
(h) prior to any public offering of Registrable Securities,
register or qualify or cooperate with the selling holders of Registrable
Securities, the underwriters, if any, and their respective counsel in connection
with the registration or qualification of such Registrable Securities for offer
and sale under the securities or blue sky laws of such jurisdictions as any such
seller or underwriter reasonably requests in writing and do any and all other
acts or things necessary or advisable to enable the disposition in such
jurisdictions of such Registrable Securities; provided that the Registrants will
not be required to qualify generally to do business in any jurisdiction where it
is not then so qualified or to take any action which would subject it to general
service of process in any such jurisdiction where it is not then so subject;
(i) cooperate with the selling holders of Registrable Securities
and the managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing such Registrable Securities to be sold and
not bearing any restrictive legends; and enable such Registrable Securities to
be in such denominations and registered in such names as such managing
underwriters may request at least two business days prior to any sale of such
Registrable Securities to the underwriters;
(j) use their reasonable best efforts to cause the Registrable
Securities covered by the applicable Registration Statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof or the underwriters, if any,
to consummate the disposition of such Registrable Securities;
(k) upon the occurrence of any event contemplated by paragraph
(c)(6) above, prepare a supplement or post-effective amendment to the related
Registration Statement or the related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered to the holders of the Registrable Securities, the Prospectus will not
contain an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading;
(l) use reasonable efforts to cause all Registrable Securities
covered by a Registration Statement to be listed on each securities exchange on
which similar securities issued by the Registrants are then listed if requested
by the holders of a majority in aggregate principal amount of such Registrable
Securities or the managing underwriters, if any;
(m) cause the Registrable Securities covered by a Registration
Statement to be rated with such rating agencies as the holders of a majority in
aggregate principal amount of such Registrable Securities or the managing
underwriters, if any, may designate;
(n) not later than the effective date of the Shelf Registration,
provide a CUSIP number for all Registrable Securities and provide the Exchange
Note Indenture trustee or transfer agent with printed certificates for the
Registrable Securities which are in a form eligible for deposit with The
Depository Trust Company;
(o) enter into such agreements (including an underwriting
agreement) and take all such other actions in connection therewith in order to
expedite or facilitate the disposition of such Registrable Securities and in
such connection, whether or not an underwriting agreement is entered into and
whether or not the registration is an underwritten registration (1) make such
representations and warranties to the holders of such Registrable Securities and
the underwriters, if any, in form, substance and scope as are customarily made
by issuers to underwriters in primary underwritten offerings; (2) obtain
opinions of
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counsel to the Registrants and updates thereof (which counsel and opinions (in
form, scope and substance) shall be reasonably satisfactory to the managing
underwriters, if any, and the holders of a majority in principal amount of such
Registrable Securities) addressed to each selling holder and the underwriters,
if any, covering the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably requested by
such holders and underwriters; (3) obtain "comfort" letters and updates thereof
from the Registrants' independent certified public accountants addressed to such
holders and underwriters, if any, such letters to be in customary form and
covering matters of the type customarily covered in "comfort" letters by
underwriters in connection with primary underwritten offerings; (4) if an
underwriting agreement is entered into, the same shall set forth in full the
indemnification provisions and procedures of Section 7 hereof with respect to
all parties to be indemnified pursuant to Section 7; and (5) deliver such
documents and certificates as may be requested by the holders of a majority of
the Registrable Securities being sold and the managing underwriters, if any, to
evidence compliance with clause (k) above and with any customary conditions
contained in the underwriting agreement or other agreement entered into by the
Registrants. The above shall be done at each closing under such underwriting or
similar agreement or as and to the extent required thereunder;
(p) make available for inspection by any underwriter participating
in any disposition of such Registrable Securities pursuant to a Shelf
Registration, and any attorney or accountant retained by such holders or
underwriters, if any, all financial and other records, pertinent corporate
documents and properties of the Registrants, and cause the Registrants'
officers, directors and employees to supply all information reasonably requested
by any such representative, underwriter, attorney or accountant in connection
with such Shelf Registration;
(q) otherwise use their best efforts to comply with all applicable
rules and regulations of the SEC;
(r) cause the Exchange Note Indenture to be qualified under the
TIA, provide an indenture trustee for each of the Registrable Securities not
later than the effective date of the Shelf Registration, and in connection
therewith, cooperate with the trustee under the Exchange Note Indenture and the
holders of the Exchange Notes to effect such changes to the Exchange Note
Indenture as may be required for the Exchange Note Indenture to be so qualified
in accordance with the terms of the TIA and execute, and use their reasonable
best efforts to cause such trustee to execute, all documents as may be required
to effect such changes and all other forms and documents required to be filed
with the SEC to enable the Exchange Note Indenture to be so qualified in a
timely manner; and
(s) make appropriate officers of the Registrants available to such
holders and the underwriters, if any, for meetings with prospective purchasers
of the Registrable Securities and prepare and present to potential investors
"roadshow" material in a manner consistent with other new issuances of high
yield debt securities.
The Registrants may require each seller of Registrable Securities as
to which any registration is being effected to furnish to the Registrants such
information regarding the distribution of such securities as the Registrants may
from time to time reasonably request in writing.
Each holder of Registrable Securities agrees by acceptance of such
Registrable Securities that, upon receipt of any notice from the Registrants of
the happening of any event of the kind described in Section 5(k) hereof, such
holder will forthwith discontinue disposition of Registrable Securities until
such holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 5(k) hereof, or until it is advised in writing (the
"ADVICE") by the Registrants that the use of such Prospectus
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may be resumed, and has received copies of any additional or supplemental
filings which are incorporated by reference in such Prospectus, and, if so
directed by the Registrants, such holder will deliver to the Registrants (at the
Registrants' expense) all copies, other than permanent file copies then in such
holder's possession, of such Prospectus covering such Registrable Securities
current at the time of receipt of such notice. In the event the Registrants
shall give any such notice, the time periods regarding the maintenance of the
Shelf Registration and the filing and maintenance of the Shelf Registration in
Section 3 hereof shall be extended by the number of days during the period from
and including the date of the giving of such notice pursuant to Section 5(c)(6)
hereof to and including the date when each seller of Registrable Securities
covered by such Registration Statement shall have received the copies of the
supplemented or amended Prospectus contemplated by Section 5(k) hereof or the
Advice.
6. Registration Expenses
(a) All expenses incident to the Registrants' performance of or
compliance with this Agreement, including without limitation all (i)
registration and filing fees, fees and expenses associated with filings required
to be made with the NASD (including, if applicable, the fees and expenses of any
"qualified independent underwriter" and their counsel as may be required by the
rules and regulations of the NASD), (ii) fees and expenses of compliance with
securities or blue sky laws (including fees and disbursements of counsel for the
underwriters or selling holders in connection with blue sky qualifications of
the Registrable Securities and determination of their eligibility for investment
under the laws of such jurisdictions as the managing underwriters or holders of
a majority in aggregate principal amount of the Registrable Securities being
sold may designate), (iii) printing expenses (including expenses of printing
certificates for the Registrable Securities in a form eligible for deposit with
The Depository Trust Company and of printing prospectuses), messenger, telephone
and delivery expenses, (iv) fees and disbursements of counsel for the
Registrants and for the sellers of the Registrable Securities (subject to the
provisions of Section 6(b) hereof), of all independent certified public
accountants (including the expenses of any special audit and "comfort" letters
required by or incident to such performance), and of underwriters (excluding
discounts, commissions or fees of underwriters, selling brokers, dealer managers
or similar securities industry professionals relating to the distribution of the
Registrable Securities or legal expenses of any Person other than the
Registrants and the selling holders), (v) the cost of securities acts liability
insurance if the Registrants so desires, (vi) "roadshow" travel and other
expenses incurred in connection with the marketing and sale of the Registrable
Securities, (vii) fees and expenses in connection with the rating of the
Registrable Securities by rating agencies, if any, and (viii) fees and expenses
of other Persons retained by the Registrants (all such expenses being herein
called "REGISTRATION EXPENSES") will be borne by the Registrants, regardless
whether the Registration Statement becomes effective. The Registrants, in any
event, will pay their own internal expenses (including, without limitation, all
salaries and expenses of their officers and employees performing legal or
accounting duties), the expense of any annual audit, the fees and expenses
incurred in connection with the listing of the securities to be registered on
each securities exchange on which similar securities issued by the Registrants
are then listed, rating agency fees and the fees and expenses of any Person,
including special experts, retained by the Registrants.
(b) In connection with the Shelf Registration hereunder, the
Registrants will reimburse the selling holders of Registrable Securities being
registered in such registration for the reasonable fees and disbursements of not
more than one law firm (which shall be reasonably acceptable to the Company)
chosen by the selling holders of a majority in principal amount of such
Registrable Securities.
7. Indemnification
(a) Indemnification by the Registrants. The Registrants jointly and
severally agree to
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indemnify and hold harmless, to the full extent permitted by law, each holder of
Registrable Securities, their officers, directors and employees and each Person
who controls such holder (within the meaning of the Securities Act) (the
"INDEMNIFIED PARTIES") against all losses, claims, damages, liabilities and
expenses incurred by such party in connection with any actual or threatened
action arising out of or based upon any untrue or alleged untrue statement of a
material fact contained in any Registration Statement, Prospectus or preliminary
Prospectus or any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein (in
the case of a Prospectus or a preliminary Prospectus, in light of the
circumstances then existing) not misleading, except insofar as the same arise
out of or are based upon any such untrue statement or omission made in reliance
on and in conformity with any information furnished in writing to the
Registrants by such holder or its counsel expressly for use therein; provided,
that the Registrants shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission in
the Prospectus, if such untrue statement or alleged untrue statement or omission
or alleged omission is completely corrected in an amendment or supplement to the
Prospectus and the holder of Registrable Securities thereafter fails to deliver
such Prospectus as so amended or supplemented prior to or concurrently with the
sale of the Registrable Securities to the person asserting such loss, claim,
damage, liability or expense after the Registrants had furnished such holder
with a sufficient number of copies of the same. The Registrants shall also
indemnify underwriters, their officers and directors and each Person who
controls such Persons (within the meaning of the Securities Act) to the same
extent as provided above with respect to the indemnification of the Indemnified
Parties, if requested.
(b) Indemnification by Holder of Registrable Securities. In
connection with the Shelf Registration, each holder of Registrable Securities
will furnish to the Registrants in writing such information and affidavits as
the Registrants reasonably request for use in connection with any Registration
Statement or Prospectus and agrees to indemnify and hold harmless, to the full
extent permitted by law, the Registrants, their directors and officers and each
Person who controls the Registrants (within the meaning of the Securities Act)
against any losses, claims, damages, liabilities and expenses resulting from any
untrue statement of a material fact contained in any Registration Statement or
Prospectus or any omission of a material fact required to be stated in the
Registration Statement or Prospectus or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, to the extent, but only to the extent, that such untrue statement or
omission relates to a holder and is made in reliance on and in conformity with
any information or affidavit furnished in writing by such holder to the
Registrants specifically for inclusion in such Registration Statement or
Prospectus. In no event shall the liability of any selling holder of Registrable
Securities hereunder be greater in amount than the dollar amount of the proceeds
received by such holder upon the sale of the Registrable Securities giving rise
to such indemnification obligation. The Registrants shall be entitled to receive
indemnities from underwriters, selling brokers, dealer managers and similar
securities industry professionals participating in the distribution of such
Registrable Securities to the same extent above with respect to information or
affidavit furnished writing by such Persons as provided specifically for any
Prospectus or Registration Statement.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder will (i) give prompt notice to the Registrants or
holder of Registrable Securities, as the case may be (in either case, as
applicable, an "INDEMNIFYING PARTY"), of any claim with respect to which it
seeks indemnification and (ii) permit such Indemnifying Party to assume the
defense of such claim with counsel reasonably satisfactory to such Person;
provided, however, that any Person entitled to indemnification hereunder shall
have the right to employ separate counsel and to participate in the defense of
such claim, but the fees and expenses of such counsel shall be at the expense of
such Person unless (a) the Indemnifying Party has agreed to pay such fees or
expenses, (b) the Indemnifying Party has failed to assume the defense of such
claim or (c) in the reasonable judgment of any such Person, based upon written
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advice of its counsel, a conflict of interest may exist between such Person and
the Indemnifying Party with respect to such claims (in which case, if the Person
notifies the Indemnifying Party in writing that such Person elects to employ
separate counsel at the expense of the Indemnifying Party, the Indemnifying
Party shall not have the right to assume the defense of such claim on behalf of
such Person). If such defense is not assumed by the Indemnifying Party, the
Indemnifying Party will not be subject to any liability for any settlement made
without its consent (but such consent will not be unreasonably withheld). No
Indemnifying Party will be required to consent to entry of any judgment or enter
into any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Person entitled to indemnification a
release from all liability in respect to such claim or litigation. Any
Indemnifying Party who is not entitled to, or elects not to, assume the defense
of a claim will not be obligated to pay the fees and expenses of more than one
counsel for all Persons entitled to indemnification by such Indemnifying Party
with respect to such claim in any one jurisdiction, unless in the reasonable
judgment of such Person a conflict of interest may exist between such Person and
any other Person entitled to indemnification hereunder with respect to such
claim, in which event the Indemnifying Party shall be obligated to pay the fees
and expenses of such additional counsel or counsels, but only of one such
additional counsel for each group of similarly situated Persons in any one
jurisdiction.
(d) Contribution. If for any reason the indemnification provided
for in the preceding paragraphs (a) and (b) is unavailable to a Person entitled
to indemnification or is insufficient to hold it harmless as contemplated by the
preceding paragraphs (a) and (b), then the Indemnifying Party shall contribute
to the amount paid or payable by such Person as a result of such loss, claim,
damage or liability in such proportion as is appropriate to reflect not only the
relative benefits received by such Person and the Indemnifying Party, but also
the relative fault of such Person and the Indemnifying Party, as well as any
other relevant equitable considerations, provided that no holder of Registrable
Securities shall be required to contribute an amount greater than the dollar
amount of the proceeds received by such holder of Registrable Securities with
respect to the sale of any securities. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
8. Rule 144
The Registrants covenant that they will file the reports required to
be filed by them under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder (or, if any of them is not required to
file such reports, the applicable party will, upon the request of any holder of
Registrable Securities made after the two year anniversary of the making of the
Loans, make publicly available other information so long as necessary to permit
sales pursuant to Rule 144 under the Securities Act), and they will take such
further action as any holder of Registrable Securities may reasonably request,
all to the extent required from time to time to enable such holder to sell
Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by (a) Rule 144 under the Securities Act,
as such Rule may be amended from time to time, or (b) any similar rule or
regulation hereafter adopted by the SEC. Upon the request of any holder of
Registrable Securities, the Registrants will deliver to such holder a written
statement as to whether they have complied with such information and filing
requirements.
9. Miscellaneous
(a) Remedies. Each holder of Registrable Securities and Loans, in
addition to being entitled to exercise all rights provided herein, in the
Exchange Note Indenture or granted by law, including recovery of damages, in
connection with the breach by the Registrants of their obligations to register
the Registrable
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Securities will be entitled to specific performance of its rights under this
Agreement. The Registrants agree that monetary damages (including the Liquidated
Damages contemplated hereby) would not be adequate compensation for any loss
incurred by reason of a breach by any of them of the provisions of this
Agreement and each agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Registrants will not on or
after the date of this Agreement enter into any agreement with respect to their
securities which is inconsistent with the rights granted to the holders of
Registrable Securities in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the holders of Registrable Securities
hereunder do not in any way conflict with and are not inconsistent with the
rights granted to the holders of the Registrants' respective securities under
any other agreements. The Registrants have not previously entered into, and
shall not for the term of this Agreement enter into, any agreement with respect
to their securities granting any registration rights to any Person.
(c) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions of this
Agreement may not be given unless the Registrants have obtained the written
consent of holders of at least a majority of the principal amount of (x) the
outstanding Registrable Securities and (y) the outstanding Loans (excluding
Registrable Securities held by the Company, the Guarantors or one of their
respective affiliates); provided that provisions hereunder relating to
Liquidated Damages and the payment thereof may not be amended, modified or
supplemented, and waivers or consents to departures from such provisions may not
be given unless the Registrants have obtained the written consent of holders of
at least 66-2/3% of the principal amount of (x) the outstanding Registrable
Securities and (y) the outstanding Loans (excluding Registrable Securities held
by the Company, the Guarantors or one of their respective affiliates).
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, facsimile or air courier guaranteeing overnight delivery:
(i) if to a holder of Registrable Securities, at the most
current address given by such holder to the Registrants in
accordance with the provisions of this Section 9(d), which address
initially is, with respect to the Administrative Agent to it at the
address set forth in the Bridge Loan Agreement, with a copy to
Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx
00000-0000, Attention: Xxxxxxx X. Xxx, Esq.; and
(ii) if to the Registrants, initially to them at the address
set forth in the Bridge Loan Agreement and thereafter at such other
address, notice of which is given in accordance with the provisions
of this Section 9(d), with copies to Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP, 0000 Xxx Xxxx Xxxxxx, X.X., Xxxxxxxxxx XX 00000,
Attention: Xxxxxxx Xxxxx, Esq. and Xxxxxx & Xxxxxx, L.L.P., 000
Xxxxxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxx, 00000, Attention: Xxxxxxx X.
Xxxxxxx, Esq.
All such notices and communications shall be deemed to have been
duly given at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if delivered by facsimile; and on the next business day if timely
delivered to an air courier guaranteeing overnight delivery.
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Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the trustee under the
Exchange Note Indenture at the address specified in the Exchange Note Indenture.
(e) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the parties
hereto, including without limitation and without the need for an express
assignment, all subsequent holders of Registrable Securities or Loans.
(f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
(h) New York Law; Submission to Jurisdiction; Waiver of Jury Trial.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK. EACH PARTY HERETO HEREBY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN NEW YORK CITY FOR PURPOSES
OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT
AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM. EACH PARTY HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
(i) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of any such provision in such jurisdiction in every
other respect and of the remaining provisions contained herein shall not be
affected or impaired thereby.
(j) Entire Agreement. This Agreement is intended by the parties as
a final expression of their agreement with respect to the subject matter
contained herein and intended to be a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein with respect to
the registration rights granted by the Registrants with respect to the
securities sold pursuant to the Bridge Loan Agreement. This Agreement supersedes
all prior agreements and understandings between the parties with respect to such
subject matter.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
KEY ENERGY GROUP, INC.
By:
--------------------------------------------
Name:
Title:
GUARANTORS
[Insert name and signature block for each Guarantor]
By:
--------------------------------------------
Name:
Title:
XXXXXX COMMERCIAL PAPER INC.
By:
--------------------------------------------
Name:
Title:
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
KEY ENERGY GROUP, INC.
By: /s/ XXXXXXX X. XXXXXXXX
--------------------------------------------
Name:
Title:
GUARANTORS
YALE E. KEY, INC.
WELLTECH EASTERN, INC.
KEY ENERGY DRILLING INC.
KALKASKA OILFIELD SERVICES, INC.
ODESSA EXPLORATION INCORPORATED
WELL-CO OIL SERVICE, INC.
XXXXXXX WELL SERVICE, INC.
XXXXXX WELL SERVICE, INC.
RAM OIL WELL SERVICE, INC.
XXXXXXX TRUCKING CO., INC.
LANDMARK FISHING & RENTAL, INC.
XXXXXX WELL SERVICE, INC.
FRONTIER WELL SERVICE, INC.
KEY ROCKY MOUNTAIN, INC.
KEY FOUR CORNERS, INC.
KEY ENERGY SERVICES-SOUTH TEXAS, INC.
WELLTECH MID-CONTINENT, INC.
XXXXXX WELL SERVICING, INC.
MIDLAND ACQUISITION CORP.
XXXXXX BROTHERS, INC.
X.X. XXXXXX WELL SERVICE COMPANY
XXXXXX OILFIELD SERVICE & SUPPLY, INC.
XXXXX SERVICE CO.
XXXXX WELL SERVICE, INC.
XXXXX TRANSPORTATION, INC.
INDUSTRIAL OILFIELD SUPPLY, INC.
By: /s/ XXXXXXX X. XXXXXXXX
--------------------------------------------
Name:
Title:
of all the foregoing companies
XXXXXX COMMERCIAL PAPER INC.
By: /s/ XXXXXX XXX
--------------------------------------------
Name:
Title:
15
