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EXHIBIT 10.6
MASTER DRILLING AGREEMENT
This Master Drilling Agreement (this "Agreement") , dated as
of December 10, 1996, is made by and among Bayard Drilling Technologies, Inc.,
a Delaware corporation ("Bayard"), Chesapeake Energy Corporation, a Delaware
corporation ("Chesapeake"), and Chesapeake Operating, Inc., a Delaware
corporation ("Operating").
WITNESSETH:
WHEREAS, Bayard, Chesapeake and certain other parties named
therein entered into that certain Master Agreement, dated as of November 26,
1996 (the "Master Agreement"), pursuant to which Chesapeake and the other
parties thereto acquired interests in Bayard;
WHEREAS, the Master Agreement contemplates, among other things,
that: (a) Chesapeake will enter into this Agreement, which will set forth the
governing terms of the Drilling Agreements (as defined herein) to be entered
into by Bayard and Operating; (b) Operating shall enter into each of six (6)
separate Drilling Agreements (the "Drilling Agreements") pursuant to which
operating will employ specified drilling rigs of Bayard (the "Rigs"); and (c)
Bayard and Chesapeake will enter into an Option Agreement (as defined in the
Master Agreement) pursuant to which Bayard will grant to Chesapeake an option to
purchase shares of the common stock of Bayard for a specified term which may be
extended if operating extends four (4) of the Drilling Agreements as specified
in the Master Agreement; and
WHEREAS, Bayard, Chesapeake and Operating desire to set forth
the terms and conditions of such arrangements herein.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements set forth herein, the mutual benefits to be
gained by the performance thereof and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged and accepted, the
parties hereto hereby agree as follows:
1. Form of Drilling Agreement. The terms and conditions
pursuant to which each of the Rigs shall be used and operated shall be set forth
in the "Drilling Rig Proposal and Daywork Drilling Contract - US" each of which
is attached hereto as Exhibit A (the "Drilling Agreements"). Each of the
Drilling Agreements shall be executed by Bayard and operating simultaneously
with execution of this Agreement.
2. Primary Term. The term of each Drilling Agreement
shall be two (2) years and shall commence on the spud date of the first well
drilled by each such rig pursuant to the Drilling Agreement; provided that the
spud date of the first well shall be deemed to be January 1, 1997, for each rig
and the applicable Drilling Agreement for which the spud date of the first well
is subsequent to January 1, 1997.
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3. Term Extensions. Bayard shall have the option to
extend any two (2) of the Drilling Agreements for two (2) additional years, each
on the same terms as set forth in the applicable Drilling Agreement. Operating
shall have the option to extend each of the other four (4) Drilling Agreements
for two (2) additional years on the same terms as set forth in the applicable
Drilling Agreement.
4. Guarantee. By execution of this Agreement, Chesapeake
unconditionally guarantees the payment of all amounts payable by, and the
performance of all the obligations of, operating under this Agreement and each
of the Drilling Agreements during the primary term of each such agreement and
any extension thereof.
5. Consent to Amendments, Waivers. Except as otherwise
expressly provided herein, the provisions of this Agreement shall not be amended
or waived except upon the written agreement of all parties hereto.
6. No Assignment. This Agreement may not be assigned by
Operating without the written consent of Bayard. Any purported or attempted
assignment in violation of this Section 5 shall be void ab initio.
7. Severability. Whenever possible, each provision of
this Agreement shall be interpreted so as to be effective and valid under
applicable law. If any provision of this Agreement is held to be prohibited by
or invalid under applicable law, such provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
this Agreement.
8. Headings. The descriptive headings of this Agreement
are inserted for convenience of reference only and do not constitute a part of
and shall not affect the interpretation of this Agreement.
9. Notices. Any notices required or permitted to be sent
hereunder shall be delivered by hand, by telex or telecopier, or by certified
or registered mail, postage prepaid and return receipt requested, or delivered
by overnight courier service to the following addresses, or such other address
as any party hereto designates by written notice to the other parties. Notices
shall be deemed to have been given upon delivery, if delivered by hand, three
days after mailing, if mailed, one business day after delivery to the courier,
if delivered by overnight courier service, and upon receipt of an appropriate
answer back, if by telex or telecopier:
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If to Bayard, to:
Bayard Drilling Technologies, Inc.
Suite 400E, Lakepoint Towers
0000 Xxxxxxxxx Xxxxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attn: President
(000) 000-0000 (fax)
If to Chesapeake or Operating, to:
Chesapeake Energy Corporation
X.X. Xxx 0000
Xxxxxxxx Xxxx, XX 00000-0000
Attn: Xxxxxx Xxxxxxx
(000) 000-0000, ext. 232
(000) 000-0000 (fax)
10. Governing Law. This Agreement shall be governed in
accordance with the laws of the State of Oklahoma, without giving effect to the
choice of law principles thereof.
11. Entire Agreement. This Agreement constitutes the
entire agreement of the parties concerning the transactions contemplated
hereby, and supersedes all prior agreements and understandings, written or oral,
regarding the subject matter hereof.
12. Execution in Counterparts. This Agreement may be
executed in any number of counterparts, each of which when so executed and
delivered shall be deemed an original, and all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first above written.
XXXXXX
Xxxxxx Drilling Technologies, Inc.,
a Delaware corporation
By: /s/ Xxxxx X. Xxxxx
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President
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OPERATING
Chesapeake Operating, Inc.,
a Delaware corporation
By: /s/ Xxxxxx XxXxxxxxx
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Chairman and Chief Executive Officer
CHESAPEAKE
Chesapeake Energy Corporation,
a Delaware corporation
By: /s/ Xxxxxx XxXxxxxxx
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Chairman and Chief Executive Officer
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