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AMENDMENT NO. 2
TO
AGREEMENT
This is Amendment No. 2, dated as of June 16, 2000, to the Agreement
made and entered into as of the 2nd day of August, 1999, as amended by
Amendment No. 1 dated as of December 1, 1999, by and between Francis D. John,
as Borrower, and Key Energy Services, Inc., as Lender, (the "Agreement").
Unless the context otherwise requires, defined terms used in this Amendment
No. 2 shall have the meaning ascribed to them as set forth in the Agreement.
BACKGROUND
A. The Borrower and Lender have entered into the Agreement pursuant
to which the Lender has agreed to forgive an aggregate of
$5,000,000, together with accrued interest thereon, which has
been borrowed by the Borrower from the Lender in accordance with
the terms and conditions set forth therein.
B. After further deliberations and discussions by and among the
members of the Board of Directors (the "Board") of the Lender, as
well as discussions by members of the Board with the Borrower,
the Borrower and Lender have determined that it would be in the
best interests of the Lender and its shareholders to amend the
terms of the Agreement.
NOW, THEREFORE, intending to be legally bound, the Borrower and the
Lender hereby agree as follows:
(I). AMENDMENT TO SECTION 1 OF THE AGREEMENT. Effective as of the
date hereof, Section 1 of the Agreement is hereby amended by deleting the
section in its entirety and replacing it with "[Reserved]".
(II). FURTHER AMENDMENT TO SECTION 1 OF THE AGREEMENT. Effective as
of July 1, 2000, Section 1 of the Agreement shall be amended by deleting the
section in its entirety and substituting therefor a new Section 1 as set
forth below:
"1. FORGIVENESS/CANCELLATION OF INDEBTEDNESS. Except (a) in the event
of an acceleration in Borrower's obligation to repay the
outstanding Indebtedness and make payment on any of the
outstanding Notes as a result of (i) the termination of the
Borrower's employment by the Lender for "Cause" (as defined and
described below) or (ii) the voluntary termination by the
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borrower of his employment with the Lender for any reason or (b)
in the event of an acceleration in the Lender's obligation to
forgive/cancel the Indebtedness and cancel the Notes as a result
of (i) the Borrower's termination of his employment with the
Lender as a result of "Good Reason", "Change in Control" or
"Disability" (as defined and described below) or (ii) the death
of the Borrower, the Lender hereby agrees that, for so long as
the Borrower remains employed by the Lender, the Indebtedness
will be forgiven/canceled in the proportions and amounts and on
the dates set forth below:
<TABLE>
<CAPTION>
PROPORTION/AMOUNT OF
INDEBTEDNESS TO BE
DATE FORGIVEN/CANCELED
---- -----------------
<S> <C>
June 30, 2001 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
June 30, 2002 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
June 30, 2003 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
June 30, 2004 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
June 30, 2005 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
June 30, 2006 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
June 30, 2007 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
2
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PROPORTION/AMOUNT OF
INDEBTEDNESS TO BE
DATE FORGIVEN/CANCELED
---- -----------------
<S> <C>
June 30, 2008 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
June 30, 2009 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
June 30, 2010 1/10th (10%)
($500,000.00, plus accrued
but unpaid interest thereon)
</TABLE>
The Indebtedness will be forgiven/canceled by Lender chronologically
in the order in which it was incurred by the Borrower."
(III). AGREEMENT IN FULL FORCE AND EFFECT. Except as otherwise
modified or amended by the provisions of this Amendment No. 2 as set forth
above, the terms and provisions of the Agreement shall remain in full force
and effect.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
KEY ENERGY SERVICES, INC.
Lender
By: /s/ MORTON WOLKOWITZ
-------------------------
MORTON WOLKOWITZ,
Director
Borrower:
/s/ FRANCIS D. JOHN
-----------------------------
FRANCIS D. JOHN
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