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EXHIBIT 99.11
SUPPLEMENTAL INDENTURE
Supplemental Indenture (this "SUPPLEMENTAL INDENTURE") dated as of
September 21, 1998 among Key Energy Group, Inc. (or its permitted successor), a
Maryland corporation (the "COMPANY"), the Subsidiary Guarantors (defined below),
and U.S. Trust Company of Texas, N.A. as trustee (the "TRUSTEE") under the
Indenture (defined below).
WITNESSETH
WHEREAS, Xxxxxx Production Services, Inc., a Texas corporation
("XXXXXX"), and Xxxxxx Companies, Inc. and Xxxxxx Production Services de Mexico,
S.A. de C.V. (together, the "ORIGINAL SUBSIDIARY GUARANTORS") have previously
executed and delivered to the Trustee an indenture (the "INDENTURE"), dated as
of February 20, 1997, providing for the issuance of an aggregate principal
amount of up to $140,000,000 of 9-3/8% Senior Notes due 2007 (the "NOTES");
WHEREAS, the Company has entered into that certain Agreement and Plan
of Merger by and among the Company, Xxxxxx and Midland Acquisition Corp., a New
Jersey corporation and a wholly-owned subsidiary of the Company ("MIDLAND"),
dated as of August 11, 1998 (the "MERGER AGREEMeNT");
WHEREAS, Midland has made a tender offer for the stock of Xxxxxx;
WHEREAS, under the terms of the Merger Agreement, Midland will be
merged with and into Xxxxxx with Xxxxxx being the surviving entity, and Xxxxxx
will be merged with and into the Company with the Company being the surviving
entity (collectively, the "MERGER");
WHEREAS, Section 5.1 of the Indenture does not permit Xxxxxx to merge
with another entity unless the surviving entity satisfies certain conditions,
including the execution and delivery to the Trustee of a supplemental indenture
pursuant to which the Company assumes all of Xxxxxx'x obligations under the
Notes and the Indenture;
WHEREAS, the Company has entered into a Second Amended and Restated
Credit Agreement dated as of June 6, 1997, as amended and restated through
September 14, 1998 (the "PNC CREDIT FACILITY"), among PNC Bank, National
Association, as Administrative Agent, the lenders from time to time party
thereto (the "LENDERS"), the Arranger named therein, and Norwest Bank Texas,
N.A., as collateral agent (the "COLLATERAL AGENT");
WHEREAS, each of the Company and certain of the Subsidiary Guarantors
have granted liens on their assets to secure the PNC Credit Facility under the
terms of (a) that certain Amended and Restated Master Guarantee and Collateral
Agreement made by the Company and certain of its subsidiaries in favor of the
Collateral Agent, dated as of June 6, 1997, as amended and restated
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through September 14, 1998 (the "COLLATERAL AGREEMENT"), and (b) certain real
property mortgages and oil and gas mortgages (the "MORTGAGES");
WHEREAS, Section 4.12 of the Indenture only permits the PNC Credit
Facility to be secured if the Notes and the Indenture are ratably secured by the
collateral which secures the PNC Credit Facility;
WHEREAS, Section 10.2 of the Indenture requires each of the
Subsidiaries listed on attached SCHEDULE 1 (the "SUBSIDIARY GUARANTORS") to
become a Subsidiary Guarantor under and as defined in the Indenture; and
WHEREAS, pursuant to Section 9.1(a) of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
to this Supplemental Indenture mutually covenant and agree for the equal and
ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
2. ASSUMPTION OF OBLIGATIONS. The Company hereby assumes and becomes
personally liable for all of the obligations of Xxxxxx under the Indenture and
the Notes.
3. AGREEMENT TO GUARANTEE. Each of the undersigned Subsidiary
Guarantors hereby jointly and severally and unconditionally guarantees, on a
senior basis, to each Holder of a Note authenticated and delivered by the
Trustee, irrespective of the validity or enforceability of the Indenture, the
Notes or the obligations of the Company under the Indenture or the Notes, in the
manner provided in Section 10.1 of the Indenture and agrees to be bound by all
the terms of Article 10 of the Indenture.
4. AGREEMENT TO SECURE NOTES. Pursuant to Section 4.12 of the
Indenture which requires the Notes to be equally and ratably secured with
respect to the PNC Credit Facility, under the Collateral Agreement, effective
upon consummation of the Merger, the Company and certain of the Subsidiary
Guarantors have granted a lien in favor of, equally and ratably, the Lenders and
the Holders of the Notes, which lien attaches to the collateral described in the
Collateral Agreement. The Company and certain of the Subsidiary Guarantors have
also granted, effective upon consummation of the Merger, equal and ratable liens
in favor of the Lenders and the Holders of the Notes on certain of their
respective real property and oil and gas properties. All assets equally and
ratably pledged to the Lenders have also been pledged, effective upon the
Merger, to the Holders of the Notes. In the event that the Collateral Agreement
(or any of the Mortgages) is terminated in accordance with its terms, the rights
granted to the Collateral Agent
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under the Collateral Agreement (or any terminated Mortgage) for the equal
and ratable benefit of the Holders of the Notes will be automatically terminated
without any further action.
5. AGREEMENT TO APPOINT COLLATERAL AGENT. The parties to this
Supplemental Indenture hereby agree, approve and ratify the appointment of
Norwest Bank Texas, N.A. as collateral agent for the Trustee, to act for the
benefit of the Trustee under the terms of the Collateral Agreement and Mortgages
and the terms and conditions set forth in the Intercreditor and Collateral
Agency Agreement, dated as of September 14, 1998, among Norwest Bank Texas,
N.A., as collateral agent, and the Company and certain of its subsidiaries.
6. EXECUTION AND DELIVERY. Each Subsidiary Guarantor agrees that
this Supplemental Indenture shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such
guarantee.
7. GOVERNING LAW. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE, THE NOTES, AND THE
SUBSIDIARY GUARANTEES BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.
8. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
9. EFFECT OF HEADINGS. The Section headings herein are for
convenience only and shall not affect the construction hereof.
10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Subsidiary Guarantors and the Company.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
KEY ENERGY GROUP, INC.
By: /s/ XXXXXXX X. XXXXXXXX
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Name: XXXXXXX X. XXXXXXXX
Title: EXECUTIVE VICE PRESIDENT
YALE E. KEY, INC.
WELL-CO OIL SERVICE, INC.
RAM OIL WELL SERVICE, INC.
XXXXXXX TRUCKING COMPANY
ODESSA EXPLORATION INCORPORATED
KEY ENERGY SERVICES-SOUTH TEXAS, INC.
KEY FOUR CORNERS, INC.
KEY ROCKY MOUNTAIN, INC.
XXXXXX BROTHERS, INC.
XXXXXX WELL SERVICE, INC.
X. X. XXXXXX WELL SERVICE COMPANY
FRONTIER WELL SERVICE, INC.
XXXXXX OILFIELD SERVICE & SUPPLY, INC.
KEY ENERGY DRILLING, INC.
WELLTECH EASTERN, INC.
WELLTECH MID-CONTINENT, INC.
XXXXXX WELL SERVICING, INC.
XXXXX SERVICE CO.
XXXXX WELL SERVICE CO.
XXXXX TRANSPORTATION, INC.
INDUSTRIAL OILFIELD SUPPLY, INC.
KALKASKA OILFIELD SERVICES, INC.
LANDMARK FISHING & RENTAL, INC.
XXXXXXX WELL SERVICE, INC.
XXXXXX WELL SERVICE, INC.
By: /s/ XXXXXXX X. XXXXXXXX
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Name: XXXXXXX X. XXXXXXXX
Title: VICE PRESIDENT , of each of the
foregoing companies
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XXXXXX PRODUCTION
MANAGEMENT, INC.
XXXXXX PRODUCTION ACQUISITION
CORP.
XXXXXX PRODUCTION XXXXXX, INC.
By: /s/ XXXXXXX X. XXXXXXXX
Name: XXXXXXX X. XXXXXXXX
Title: VICE PRESIDENT , of each of the
foregoing companies
XXXXXX PRODUCTION PARTNERS, L.P.
By: XXXXXX PRODUCTION
MANAGEMENT, INC., Its
sole general partner,
By: /s/ XXXXXXX X. XXXXXXXX
Name: XXXXXXX X. XXXXXXXX
Title: VICE PRESIDENT
U.S. TRUST COMPANY OF TEXAS, N.A.,
as Trustee
By: /s/ XXXX XXXXXX
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Xxxx Xxxxxx
Vice President
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SCHEDULE 1
SCHEDULE OF SUBSIDIARY GUARANTORS
The following schedule lists each Subsidiary Guarantor under this
Supplemental Indenture as of September 21, 1998:
Subsidiaries of Key Energy Group, Inc.
Yale E. Key, Inc.
Well-Co Oil Service, Inc.
Ram Oil Well Service, Inc.
Xxxxxxx Trucking Company
Odessa Exploration Incorporated
Key Energy Services-south Texas, Inc.
Key Four Corners, Inc.
Key Rocky Mountain, Inc.
Xxxxxx Brothers, Inc.
Xxxxxx Well Service, Inc.
X. X. Xxxxxx Well Service Company
Frontier Well Service, Inc.
Xxxxxx Oilfield Service & Supply, Inc.
Key Energy Drilling, Inc.
Welltech Eastern, Inc.
Welltech Mid-Continent, Inc.
Xxxxxx Well Servicing, Inc.
Xxxxx Service Co.
Xxxxx Well Service Co.
Xxxxx Transportation, Inc.
Industrial Oilfield Supply, Inc.
Kalkaska Oilfield Services, Inc.
Landmark Fishing & Rental, Inc.
Xxxxxxx Well Service, Inc.
Xxxxxx Well Service, Inc.
Former Subsidiaries of Xxxxxx Production Services, Inc.
Xxxxxx Production Management, Inc.
Xxxxxx Production Acquisition Corp.
Xxxxxx Production Xxxxxx, Inc.
Xxxxxx Production Partners, L.P.
