Exhibit 10.1

SECOND AMENDMENT TO CREDIT AGREEMENT

DATED AS OF NOVEMBER 21, 2006

This SECOND AMENDMENT TO CREDIT AGREEMENT (together with all Exhibits, Schedules
and Annexes hereto, this “Amendment”) is among KEY ENERGY SERVICES, INC., a
Delaware corporation (the “Borrower”), the Guarantors signatory hereto, the
LENDERS (as defined in the Credit Agreement), and LEHMAN COMMERCIAL PAPER INC.,
as administrative agent for the Lenders (in such capacity, the “Administrative
Agent”) and as Collateral Agent for the Lenders and other Secured Parties (in
such capacity, the “Collateral Agent”).

PRELIMINARY STATEMENTS

A.            The Borrower, the Lenders, the Administrative Agent, Wells Fargo
Foothill, Inc., as Revolving Administrative Agent, Lehman Brothers Inc., as sole
lead arranger and sole bookrunner, and the other agents party thereto, entered
into a Credit Agreement dated as of July 29, 2005 (together with all Annexes,
Exhibits and Schedules thereto, and as heretofore amended, the “Credit
Agreement”).  Capitalized terms used and not otherwise defined in this Amendment
shall have the meanings given them in the Credit Agreement.

B.            The Borrower desires to amend the Credit Agreement to, among other
things, permit the incurrence of additional Indebtedness, in the form of new
Tranche C Term Loans, to be used for the purpose of prepaying the Tranche B Term
Loans, to replace the existing Funded Letter of Credit Facility (the “Existing
Funded L/C Facility”) with a new funded letter of credit facility and to
increase the Borrower’s ability to make Restricted Payments, Permitted
Acquisitions and Capital Expenditures.

C.            Each existing Lender with outstanding Tranche B Term Loans (an
“Existing Tranche B Term Loan Lender”) and each Lender that is a Funded L/C
Participant (an “Existing Funded L/C Participant”) that executes and delivers to
the Administrative Agent a consent to this Amendment together with a conversion
notice in the form attached hereto as Exhibit A (each, a “Conversion Notice”),
will be considered a continuing Lender (each a “Continuing Lender”) and will
exchange all of its outstanding Tranche B Term Loans for Tranche C Term Loans on
the Amendment Effective Date and will exchange its reversionary interest in the
existing Credit Linked Deposit (the “Existing Credit Linked Deposit”) for a
reversionary interest in the Credit Linked Deposit established pursuant to this
Amendment.

D.            Each Person (other than a Continuing Lender) that agrees to make
Tranche C Term Loans or to provide a Funded Letter of Credit Commitment on the
Amendment Effective Date (an “Additional Lender”) will execute and deliver to
the Administrative Agent, on or prior to the Amendment Effective Date, a Lender
Addendum, in the form attached hereto as Exhibit B and make such Tranche C Term
Loans to the Borrower or make a deposit with the Revolving Administrative Agent
in the manner contemplated by Section 2 of this Amendment.

NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

1.             AMENDMENTS TO CREDIT AGREEMENT.  SUBJECT TO THE SATISFACTION OF
THE CONDITIONS SET FORTH IN SECTION 4 HEREOF, THE CREDIT AGREEMENT IS AMENDED AS
FOLLOWS:

(A)           THE FOLLOWING NEW DEFINITIONS ARE HEREBY ADDED TO SECTION 1.1 OF
THE CREDIT AGREEMENT IN THE APPROPRIATE ALPHABETICAL ORDER:

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“Conversion Notice”:  as defined in the Second Amendment.

“Second Amendment”:  the Second Amendment to this Agreement, dated as of
November 21, 2006.

“Second Amendment Effective Date”:  the Amendment Effective Date, as defined in
the Second Amendment.

“Tranche C Term Loan”:  as defined in Section 2.1.

“Tranche C Term Loan Commitments”:  as to any Lender, the obligation of such
Lender, if any, to make a Tranche C Term Loan to the Borrower hereunder and
under the Second Amendment in a principal amount not to exceed the amount set
forth in the Conversion Notice or the Lender Addendum delivered by such Lender,
or as the case may be, in the Assignment and Acceptance pursuant to which such
Lender became a party hereto, as the same may be changed from time to time
pursuant to the terms hereof.  The original aggregate amount of the Tranche C
Term Commitments is $397,000,000.

“Tranche C Term Loan Facility”:  as defined in the definition of “Facility” in
this Section 1.1.

“Tranche C Term Loan Lender”:  each Lender that has a Tranche C Term Loan
Commitment or is the holder of a Tranche C Term Loan.

“Tranche C Term Loan Percentage”:  as to any Tranche C Term Loan Lender at any
time, the percentage which such Lender’s Tranche C Term Loan Commitment then
constitutes of the aggregate Tranche C Term Loan Commitments (or, at any time
after the Second Amendment Effective Date, the percentage which the aggregate
principal amount of such Lender’s Tranche C Term Loans then outstanding
constitutes of the aggregate principal amount of the Tranche C Term Loans then
outstanding).

(B)           THE DEFINITION OF “AGGREGATE EXPOSURE” CONTAINED IN SECTION 1.1 OF
THE CREDIT AGREEMENT IS HEREBY AMENDED TO REPLACE THE WORDS “TRANCHE B” IN
CLAUSE (B)(I) THEREOF, WITH THE WORDS “TRANCHE C”.

(C)           THE DEFINITION OF “APPLICABLE MARGIN” CONTAINED IN SECTION 1.1 OF
THE CREDIT AGREEMENT IS HEREBY AMENDED AND RESTATED TO READ AS FOLLOWS:

“Applicable Margin”:  for each Type of Loan under each Facility, the rate per
annum set forth opposite such Facility under the relevant column heading below:

 

Eurodollar 
Loans

 

Base Rate
Loans

 

Revolving Credit Facility

 

3.75

%

2.75

%

Swing Line Loans

 

—

 

2.75

%

Tranche C Term Loan Facility

 

2.50

%

1.50

%

 

provided, that on and after the first date on which the Facilities are rated by
both S&P and Moody’s, the Applicable Margins will be determined pursuant to the
Pricing Grid.

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(D)           THE DEFINITION OF “COMMITMENT” CONTAINED IN SECTION 1.1 OF THE
CREDIT AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“Commitment”: with respect to any Lender, the sum of the Tranche C Term Loan
Commitment, the Revolving Credit Commitment of such Lender and the Funded Letter
of Credit Commitment of such Lender.

(E)           THE DEFINITION OF “FACILITY” IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“Facility”:  each of (a) the Tranche C Term Loan Commitments and the Tranche C
Term Loans made thereunder (the “Tranche C Term Loan Facility”), (b) the
Revolving Credit Commitments and the extensions of credit made thereunder (the
“Revolving Credit Facility”) and (c) the Funded Letter of Credit Commitments
established on the Second Amendment Effective Date and the extensions of credit
made thereunder (the “Funded Letter of Credit Facility”).

(F)            THE DEFINITION OF “FUNDED LETTER OF CREDIT COMMITMENT” IN SECTION
1.1 OF THE CREDIT AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“Funded Letter of Credit Commitment”:  as to any Lender, the obligation of such
Lender, if any, to make or otherwise fund or maintain a Credit Linked Deposit,
in an aggregate principal amount not to exceed the amount set forth under the
heading “Funded Letter of Credit Commitment” opposite such Lender’s name on
Schedule 1 to the Lender Addendum delivered by such Lender or in the applicable
Assignment and Acceptance pursuant to which such Lender became a party hereto,
as the same may be changed from time to time pursuant to the terms hereof;
provided that the amount of each Lender’s Funded Letter of Credit Commitment
established in connection with the Second Amendment, if any, is set forth on the
Conversion Notice or Lender Addendum, as applicable, executed by such Lender. 
The aggregate amount of the Funded Letter of Credit Commitments established on
the Second Amendment Effective Date is $82,250,000.

(G)           THE DEFINITION OF “FUNDED LETTER OF CREDIT COMMITMENT PERIOD” IN
SECTION 1.1 OF THE CREDIT AGREEMENT IS HEREBY AMENDED TO INSERT THE FOLLOWING
PROVISO AT THE END THEREOF: “; PROVIDED THAT, WITH RESPECT TO THE FUNDED LETTER
OF CREDIT FACILITY ESTABLISHED IN CONNECTION WITH THE SECOND AMENDMENT, THE
FUNDED LETTER OF CREDIT COMMITMENT PERIOD SHALL BE THE PERIOD FROM AND INCLUDING
THE SECOND AMENDMENT EFFECTIVE DATE TO THE FUNDED LETTER OF CREDIT TERMINATION
DATE WITH RESPECT TO SUCH FUNDED LETTER OF CREDIT COMMITMENTS”.

(H)           THE DEFINITION OF “INTEREST PERIOD” IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED TO DELETE THE WORDS “TRANCHE B” IN EACH PLACE THEY
APPEAR IN CLAUSE (Y) THEREOF AND BY SUBSTITUTING THE WORDS “TRANCHE C” IN PLACE
THEREOF:

(I)            THE DEFINITION OF “LENDER ADDENDUM” IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“Lender Addendum”:  with respect to any applicable Lender, a Lender Addendum,
substantially in the form of Exhibit C to the Second Amendment.

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(J)            CLAUSE (D) OF THE PROVISO IN THE DEFINITION OF “MATERIAL ADVERSE
EFFECT” CONTAINED IN SECTION 1.1 OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY
DELETING “JULY 21, 2005” AND SUBSTITUTING THE WORDS “THE SECOND AMENDMENT
EFFECTIVE DATE” IN PLACE THEREOF.

(K)           THE DEFINITION OF “REPORT DATE” IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“Report Date”:  July 31, 2007.

(L)            THE DEFINITION OF “RESTATEMENT” IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“RESTATEMENT”:  (I) THE RESTATEMENT AND ADJUSTMENT OF THE BORROWER’S FINANCIAL
STATEMENTS WITH RESPECT TO THE YEAR ENDED DECEMBER 31, 2003, AND PRIOR PERIODS
AS A RESULT OF WRITE DOWNS, WRITE OFFS, CHARGES OR OTHER ADJUSTMENTS, IN EACH
CASE, TO THE EXTENT REFLECTED IN THE BORROWER’S PRESS RELEASES AND FILINGS WITH
THE SEC (INCLUDING ITS REPORT ON FORM 8-K/A FILED WITH THE SEC ON OCTOBER 26,
2006, AND THE 2003 FINANCIAL AND INFORMATIONAL REPORT FILED THEREWITH) PRIOR TO
THE SECOND AMENDMENT EFFECTIVE DATE, AND (II) THE ADJUSTMENTS TO SUBSEQUENT
PERIODS AS A RESULT OF OR ARISING FROM THE CHANGES IN ACCOUNTING METHODOLOGY OR
CHARGES AND OTHER ADJUSTMENTS RECORDED OR OTHERWISE REFLECTED IN THE 2003
FINANCIAL AND INFORMATIONAL REPORT, INCLUDING THE FINANCIAL STATEMENTS AND NOTES
CONTAINED THEREIN.

(M)          THE DEFINITION OF “TERM LOAN FACILITY” IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“Term Loan Facility”:  the Tranche C Term Loan Facility.

(N)           THE DEFINITION OF “TERM LOAN LENDERS” IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“Term Loan Lenders”:  the Tranche C Term Loan Lenders.

(O)           THE DEFINITION OF “TERM LOANS” IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED AND RESTATED AS FOLLOWS:

“Term Loans”:  the Tranche C Term Loans.

(P)           SECTION 2.1 IS HEREBY AMENDED AND RESTATED IN ITS ENTIRETY TO READ
AS FOLLOWS:

Subject to the terms and conditions hereof and of the Second Amendment, the
Tranche C Term Loan Lenders severally agree to make (or convert Tranche B Term
Loans) term loans (each, a “Tranche C Term Loan”) to the Borrower on the Second
Amendment Effective Date in an amount for each Tranche C Term Loan Lender equal
to the amount of the Tranche C Term Loan Commitment of such Lender.  The Term
Loans may from time to time be Eurodollar Loans or Base Rate Loans, as
determined in accordance with Section 2 of the Second Amendment or Section 2.13
hereof.

(Q)           SECTION 2.2 OF THE CREDIT AGREEMENT IS HEREBY AMENDED AND RESTATED
IN ITS ENTIRETY TO READ AS FOLLOWS:

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Procedure for Term Loan Borrowing.  Each Tranche C Term Loan shall be made in
accordance with Section 2 of the Second Amendment.

(R)            SECTION 2.3 OF THE CREDIT AGREEMENT IS HEREBY AMENDED AND
RESTATED IN ITS ENTIRETY TO READ AS FOLLOWS:

Repayment of Term Loans.  The Tranche C Term Loan of each Tranche C Term Loan
shall mature in 23 consecutive quarterly installments, commencing on December
31, 2006, each of which shall be in an amount equal to such Lender’s Tranche C
Term Loan Percentage multiplied by the amount set forth below opposite such
installment:

Installment

 

Principal Amount

 

December 31, 2006

 

$

1,000,000

 

March 31, 2007

 

$

1,000,000

 

June 30, 2007

 

$

1,000,000

 

September 30, 2007

 

$

1,000,000

 

December 31, 2007

 

$

1,000,000

 

March 31, 2008

 

$

1,000,000

 

June 30, 2008

 

$

1,000,000

 

September 30, 2008

 

$

1,000,000

 

December 31, 2008

 

$

1,000,000

 

March 31, 2009

 

$

1,000,000

 

June 30, 2009

 

$

1,000,000

 

September 30, 2009

 

$

1,000,000

 

December 31, 2009

 

$

1,000,000

 

March 31, 2010

 

$

1,000,000

 

June 30, 2010

 

$

1,000,000

 

September 30, 2010

 

$

1,000,000

 

December 31, 2010

 

$

1,000,000

 

March 31, 2011

 

$

1,000,000

 

June 30, 2011

 

$

1,000,000

 

September 30, 2011

 

$

1,000,000

 

December 31, 2011

 

$

1,000,000

 

March 31, 2012

 

$

1,000,000

 

June 30, 2012

 

$

375,000,000

 

 

(S)           SECTION 2.12 OF THE CREDIT AGREEMENT IS HEREBY AMENDED TO DELETE
CLAUSE (C) THEREOF.

(T)            SECTION 2.18 OF THE CREDIT AGREEMENT IS HEREBY AMENDED TO REPLACE
THE WORDS “TRANCHE B” IN EACH PLACE THEY APPEAR IN CLAUSE (A) AND (B) THEREOF
WITH THE WORDS “TRANCHE C”.

(U)           SECTION 3.5 OF THE CREDIT AGREEMENT IS HEREBY AMENDED TO ADD THE
FOLLOWING NEW SECTION (D) AT THE END THEREOF:

(d)           The Borrower and each Additional Lender and each Continuing Lender
(as defined in the Second Amendment) that is a Funded L/C Participant hereby
confirm and agree that each Funded Letter of Credit issued under this Agreement,
as in effect immediately prior to the effectiveness of the Second Amendment,
shall continue to be a Funded Letter of Credit issued under this Agreement,
after giving effect to the Second Amendment, and the Borrower and each
Additional Lender and each Continuing Lender that is a Funded L/C Participant
hereby confirm that they are bound by the provisions of

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this Section 3.5 and each other provision of this Agreement with respect to such
Funded Letters of Credit as if such Funded Letters of Credit were issued under
this Agreement, after giving effect to the Second Amendment.

(V)           SECTION 3.7(A) OF THE CREDIT AGREEMENT IS HEREBY AMENDED TO
REPLACE THE WORDS “CLOSING DATE” IN EACH PLACE THEY APPEAR THEREIN WITH THE
WORDS “SECOND AMENDMENT EFFECTIVE DATE”.

(W)          SECTION 4.1 OF THE CREDIT AGREEMENT IS HEREBY AMENDED AND RESTATED
AS FOLLOWS:

4.1           FINANCIAL CONDITION.  THE UNAUDITED CONSOLIDATED BALANCE SHEET OF
THE BORROWER AND ITS CONSOLIDATED SUBSIDIARIES AS AT DECEMBER 31, 2005, AND THE
RELATED CONSOLIDATED STATEMENTS OF INCOME AND OF CASH FLOWS FOR THE FISCAL YEARS
ENDED ON SUCH DATES, PRESENT FAIRLY IN ALL MATERIAL RESPECTS THE CONSOLIDATED
FINANCIAL CONDITION OF THE BORROWER AND ITS CONSOLIDATED SUBSIDIARIES AS AT SUCH
DATE, AND THE CONSOLIDATED RESULTS OF ITS OPERATIONS AND ITS CONSOLIDATED CASH
FLOWS FOR THE RESPECTIVE FISCAL YEARS THEN ENDED, SUBJECT TO ANY WRITE DOWNS,
WRITE OFFS, CHARGES AND ADJUSTMENTS REQUIRED AS A RESULT OF THE RESTATEMENTS. 
THE UNAUDITED CONSOLIDATED BALANCE SHEET OF THE BORROWER AND ITS CONSOLIDATED
SUBSIDIARIES AS AT SEPTEMBER 30, 2006, AND THE RELATED UNAUDITED CONSOLIDATED
STATEMENTS OF INCOME AND CASH FLOWS FOR THE NINE-MONTH PERIOD ENDED ON SUCH
DATE, PRESENT FAIRLY IN ALL MATERIAL RESPECTS THE CONSOLIDATED FINANCIAL
CONDITION OF THE BORROWER AND ITS CONSOLIDATED SUBSIDIARIES AS AT SUCH DATE, AND
THE CONSOLIDATED RESULTS OF ITS OPERATIONS AND ITS CONSOLIDATED CASH FLOWS FOR
THE NINE-MONTH PERIOD THEN ENDED (SUBJECT TO NORMAL YEAR-END AUDIT ADJUSTMENTS
AND ABSENCE OF FOOTNOTES AND SUBJECT TO ANY WRITE DOWNS, WRITE OFFS, CHARGES AND
ADJUSTMENTS, REQUIRED AS A RESULT OF THE RESTATEMENTS).  THE BORROWER AND ITS
SUBSIDIARIES DO NOT HAVE ANY MATERIAL GUARANTEE OBLIGATIONS, CONTINGENT
LIABILITIES AND LIABILITIES FOR TAXES, OR ANY MATERIAL LONG-TERM LEASES OR
UNUSUAL FORWARD OR LONG-TERM COMMITMENTS, INCLUDING, WITHOUT LIMITATION, ANY
INTEREST RATE OR FOREIGN CURRENCY SWAP OR EXCHANGE TRANSACTION OR OTHER
OBLIGATION IN RESPECT OF DERIVATIVES, THAT ARE NOT REFLECTED IN THE MOST RECENT
FINANCIAL STATEMENTS REFERRED TO IN THIS PARAGRAPH (OTHER THAN CONTINGENT
LIABILITIES ARISING IN THE ORDINARY COURSE OF BUSINESS OR AS DISCLOSED ON
SCHEDULE 4.1(B)-1 OR AS HERETOFORE DISCLOSED BY THE BORROWER IN THE 2003
FINANCIAL AND INFORMATION REPORT FILED WITH THE SEC ON OCTOBER 26, 2006). 
EXCEPT AS SET FORTH ON SCHEDULE 4.1(B)-2, DURING THE PERIOD FROM DECEMBER 31,
2004 TO AND INCLUDING THE DATE HEREOF THERE HAS BEEN NO DISPOSITION BY THE
BORROWER OR ITS CONSOLIDATED SUBSIDIARIES OF ANY MATERIAL PART OF ITS BUSINESS
OR PROPERTY.

(X)            SECTION 6.1(B)(II) OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY
DELETING “; AND” AT THE END OF SUCH SECTION AND BY SUBSTITUTING A “.” IN PLACE
THEREOF, AND SECTION 6.1(B)(III) OF THE CREDIT AGREEMENT IS HEREBY DELETED IN
ITS ENTIRETY.

(Y)           SECTION 6.14(A) IS HEREBY AMENDED TO AMEND AND RESTATE CLAUSE (II)
THEREOF AS FOLLOWS:

(II)           COMPLETE THE AUDITED FINANCIAL STATEMENTS FOR THE BORROWER’S 2004
AND 2005 FISCAL YEARS AND UNAUDITED FINANCIAL STATEMENTS FOR EACH FISCAL QUARTER
ENDED SUBSEQUENT TO FISCAL YEAR END 2004 BUT PRIOR TO DECEMBER 31, 2006, IN EACH
CASE, MEETING THE REQUIREMENTS OF REGULATION S-X FOR A FORM S-1 REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OTHER THAN ANY SUCH
REQUIREMENT THAT WOULD REQUIRE THE INCLUSION OF FINANCIAL INFORMATION AS OF OR
FOR THE PERIOD ENDED DECEMBER 31, 2003 OR ANY PRIOR DATE OR PERIOD (SUCH
FINANCIAL STATEMENTS, THE “PRIOR FINANCIAL STATEMENTS”).

(Z)            SECTION 7.6(D) OF THE CREDIT AGREEMENT IS HEREBY AMENDED AND
RESTATED AS FOLLOWS:

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(d)           the Borrower may repurchase its common stock at market prices in
an aggregate amount not to exceed $250,000,000 in the aggregate during the term
of this Agreement so long as (i) (x) if such repurchase is prior to the
Financial Reporting Compliance Date, the Borrower’s Consolidated Leverage Ratio
(based on the most recent twelve-month period for which financial statements are
available) is not greater than 1.75 to 1.00 or (y) if the repurchase is after
the Financial Reporting Compliance Date, the Borrower’s Consolidated Leverage
Ratio (based on the most recent twelve month period for which financial
statements are available) is not greater than 2.50 to 1.00 and (ii) no Default
or Event of Default exists and is continuing, or would result therefrom; and

(AA)         SECTION 7.7 OF THE CREDIT AGREEMENT IS HEREBY AMENDED (I) TO
REPLACE THE AMOUNT “$150,000,000” IN CLAUSE (A) THEREOF WITH THE FOLLOWING
LANGUAGE: “$225,000,000 PER ANNUM FOR EACH FISCAL YEAR THROUGH FISCAL YEAR 2009
AND $150,000,000 PER ANNUM THEREAFTER”, AND (II) TO REPLACE THE AMOUNT
“$25,000,000” IN CLAUSE (I) OF THE PROVISO TO SECTION 7.7(A) WITH THE AMOUNT
“$50,000,000”.

(BB)         SECTION 7.8(G)(V) OF THE CREDIT AGREEMENT IS HEREBY AMENDED AND
RESTATED IN ITS ENTIRETY AS FOLLOWS:

(V)           THE CONSIDERATION FOR SUCH PERMITTED ACQUISITION (OTHER THAN
CONSIDERATION CONSISTING OF CAPITAL STOCK OF THE BORROWER) SHALL NOT EXCEED
$100,000,000, PLUS ANY CASH PROCEEDS OF EXCLUDED EQUITY ISSUANCES; AND

(CC)         ANNEX A TO THE CREDIT AGREEMENT IS HEREBY AMENDED BY REPLACING THE
WORDS “TRANCHE B” WITH THE WORDS “TRANCHE C”

2.             TRANCHE C TERM LOANS AND THE FUNDED LETTER OF CREDIT FACILITY.

(A)           THE “TRANCHE C TERM LOAN COMMITMENT” OF (I) ANY CONTINUING LENDER
SHALL BE THE AGGREGATE PRINCIPAL AMOUNT OF ITS THEN OUTSTANDING TRANCHE B TERM
LOANS OR SUCH LESSER AMOUNT AS IS DETERMINED BY THE ADMINISTRATIVE AGENT AND
NOTIFIED TO SUCH LENDER PRIOR TO THE AMENDMENT EFFECTIVE DATE AND (II) ANY
ADDITIONAL LENDER SHALL BE THE AMOUNT OF SUCH COMMITMENT SET FORTH IN THE LENDER
ADDENDUM DELIVERED BY SUCH LENDER OR SUCH LESSER AMOUNT AS IS ALLOCATED TO IT BY
THE ADMINISTRATIVE AGENT AND NOTIFIED TO IT PRIOR TO THE AMENDMENT EFFECTIVE
DATE.  THE AGGREGATE AMOUNT OF TRANCHE C TERM LOAN COMMITMENTS SHALL EQUAL THE
AGGREGATE PRINCIPAL AMOUNT OF THE TRANCHE B TERM LOANS OUTSTANDING IMMEDIATELY
PRIOR TO THE AMENDMENT EFFECTIVE DATE.

(B)           THE “FUNDED LETTER OF CREDIT COMMITMENT” OF (I) ANY CONTINUING
LENDER SHALL BE THE AGGREGATE PRINCIPAL AMOUNT OF ITS THEN OUTSTANDING FUNDED
LETTER OF CREDIT PERCENTAGE OF THE EXISTING CREDIT LINKED DEPOSIT OR SUCH LESSER
AMOUNT AS IS DETERMINED BY THE ADMINISTRATIVE AGENT AND NOTIFIED TO SUCH LENDER
PRIOR TO THE AMENDMENT EFFECTIVE DATE AND (II) ANY ADDITIONAL LENDER SHALL BE
THE AMOUNT OF SUCH COMMITMENT SET FORTH IN THE LENDER ADDENDUM DELIVERED BY SUCH
LENDER OR SUCH LESSER AMOUNT AS IS ALLOCATED TO IT BY THE ADMINISTRATIVE AGENT
AND NOTIFIED TO IT PRIOR TO THE AMENDMENT EFFECTIVE DATE.  THE AGGREGATE AMOUNT
OF FUNDED LETTER OF CREDIT COMMITMENTS SHALL EQUAL THE AGGREGATE PRINCIPAL
AMOUNT OF THE CREDIT LINKED DEPOSIT OUTSTANDING IMMEDIATELY PRIOR TO THE
AMENDMENT EFFECTIVE DATE.

(C)           THE BORROWER SHALL GIVE THE ADMINISTRATIVE AGENT IRREVOCABLE
NOTICE OF BORROWING (WHICH NOTICE MUST BE RECEIVED BY THE ADMINISTRATIVE AGENT
PRIOR TO 12:00 NOON, NEW YORK CITY TIME, ONE BUSINESS DAY PRIOR TO THE
ANTICIPATED AMENDMENT EFFECTIVE DATE) REQUESTING THAT THE TRANCHE C TERM LOAN
LENDERS (AS DEFINED IN SECTION 1(A)) MAKE THE TRANCHE C TERM LOANS (AS DEFINED
IN SECTION 1(A)) AND THAT THE FUNDED L/C PARTICIPANTS MAKE A DEPOSIT WITH THE
REVOLVING ADMINISTRATIVE AGENT IN AN AMOUNT EQUAL TO SUCH FUNDED L/C
PARTICIPANT’S FUNDED LETTER OF CREDIT COMMITMENT ON THE AMENDMENT

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EFFECTIVE DATE AND SPECIFYING THE AMOUNT TO BE BORROWED OR DEPOSITED, AS THE
CASE MAY BE.  UPON RECEIPT OF SUCH NOTICE THE ADMINISTRATIVE AGENT SHALL
PROMPTLY NOTIFY EACH TRANCHE C TERM LOAN LENDER AND FUNDED L/C PARTICIPANT
THEREOF.  NOT LATER THAN 12:00 NOON, NEW YORK CITY TIME, ON THE AMENDMENT
EFFECTIVE DATE EACH TRANCHE C TERM LOAN LENDER SHALL MAKE AVAILABLE TO THE
ADMINISTRATIVE AGENT AT THE FUNDING OFFICE AN AMOUNT IN IMMEDIATELY AVAILABLE
FUNDS EQUAL TO THE TRANCHE C TERM LOAN TO BE MADE BY SUCH LENDER (OR PROVIDE THE
ADMINISTRATIVE AGENT WITH A CONVERSION NOTICE WITH RESPECT TO ITS TRANCHE B TERM
LOANS IN LIEU OF SUCH FUNDING REQUIREMENT).  THE ADMINISTRATIVE AGENT SHALL MAKE
AVAILABLE TO THE BORROWER THE AGGREGATE OF AMOUNTS MADE AVAILABLE TO THE
ADMINISTRATIVE AGENT BY THE TRANCHE C TERM LOAN LENDERS IN LIKE FUNDS.  TRANCHE
C TERM LOAN COMMITMENTS IN EXISTENCE ON THE AMENDMENT EFFECTIVE DATE AND NOT
REQUESTED TO BE FUNDED (INCLUDING BY WAY OF CONVERSION) ON SUCH DATE WILL
TERMINATE ON SUCH DATE.  TO THE EXTENT THAT TRANCHE B TERM LOANS ARE REPAID WITH
PROCEEDS OF TRANCHE C TERM LOANS, SUCH TRANCHE B TERM LOANS SHALL BE DEEMED TO
HAVE BEEN ASSIGNED AND TRANSFERRED TO THE TRANCHE C TERM LOAN LENDERS (TO BE
ALLOCATED AMONGST SUCH LENDERS AT THE ADMINISTRATIVE AGENT’S DISCRETION
NOTWITHSTANDING SECTION 2.18 OF THE CREDIT AGREEMENT) AND THEREAFTER SHALL BE
OUTSTANDING AS TRANCHE C TERM LOANS HELD BY THE TRANCHE C TERM LOAN LENDERS
SUBJECT TO AND IN ACCORDANCE WITH ALL TERMS, CONDITIONS AND PROVISIONS OF THIS
AMENDMENT AND THE CREDIT AGREEMENT (AS AMENDED HEREBY) APPLICABLE TO THE TRANCHE
C TERM LOANS.   IN ADDITION, NOT LATER THAN 12:00 NOON, NEW YORK CITY TIME ON
THE AMENDMENT EFFECTIVE DATE EACH FUNDED L/C PARTICIPANT THAT IS A CONTINUING
LENDING OR AN ADDITIONAL LENDER SHALL MAKE A DEPOSIT WITH THE REVOLVING
ADMINISTRATIVE AGENT (INCLUDING BY WAY OF CONVERSION) IN AN AMOUNT EQUAL TO SUCH
FUNDED L/C PARTICIPANT’S FUNDED LETTER OF CREDIT COMMITMENT.

(D)           ALL TRANCHE C TERM LOANS MADE ON THE AMENDMENT EFFECTIVE DATE WILL
HAVE THE SAME TYPES (IN THE SAME AMOUNTS) AS APPLICABLE AT SUCH TIME TO THE
TRANCHE B TERM LOANS AND WILL HAVE INITIAL INTEREST PERIODS ENDING ON THE SAME
DATES AS THE INTEREST PERIODS APPLICABLE AT SUCH TIME TO THE TRANCHE B TERM
LOANS, AND THE EURODOLLAR RATE APPLICABLE TO SUCH TRANCHE C TERM LOANS DURING
SUCH INITIAL INTEREST PERIODS WILL BE THE SAME AS THAT APPLICABLE AT SUCH TIME
TO THE TRANCHE B TERM LOANS BEING REFINANCED.  NO ACCRUED INTEREST ON THE
TRANCHE B TERM LOANS CONVERTED INTO TRANCHE C TERM LOANS SHALL BE PAYABLE ON THE
AMENDMENT EFFECTIVE DATE AND NO AMOUNTS UNDER SECTION 2.21(C) OF THE CREDIT
AGREEMENT SHALL BE PAYABLE IN CONNECTION WITH SUCH CONVERSION.

(E)           THE REQUIRED LENDERS HEREBY WAIVE THE REQUIREMENTS OF SECTION
2.11(A) OF THE CREDIT AGREEMENT SOLELY TO THE EXTENT THAT SUCH SECTION REQUIRES
ANY NOTICE OF PREPAYMENT TO BE GIVEN IN RESPECT OF THE TRANCHE B TERM LOANS TO
BE PREPAID ON THE AMENDMENT EFFECTIVE DATE AND THE REQUIREMENTS OF SECTION
2.10(B) SOLELY TO THE EXTENT THAT SUCH SECTION REQUIRES ANY NOTICE OF
TERMINATION ON THE AMENDMENT EFFECTIVE DATE OF THE EXISTING FUNDED L/C
FACILITY.  IN ADDITION, THE REQUIRED LENDERS AND THE ISSUING LENDER HEREBY WAIVE
THE REQUIREMENTS OF THE PROVISO CONTAINED OF SECTION 2.10(B) TO PERMIT THE
TERMINATION IN FULL OF THE EXISTING FUNDED LETTER OF CREDIT FACILITY ON THE
AMENDMENT EFFECTIVE DATE AND THE ESTABLISHMENT OF THE FUNDED LETTER OF CREDIT
FACILITY CONTEMPLATED BY THE SECOND AMENDMENT, NOTWITHSTANDING THE OUTSTANDING
AMOUNT OF THE TOTAL FUNDED LETTER OF CREDIT EXPOSURE.

(F)            NOTWITHSTANDING THAT THE TRANCHE B TERM LOANS SHALL BE REFINANCED
IN FULL AND THE EXISTING FUNDED L/C FACILITY TERMINATED ON THE AMENDMENT
EFFECTIVE DATE, EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION 2, THE PROVISIONS
OF THE CREDIT AGREEMENT WITH RESPECT TO INDEMNIFICATION, REIMBURSEMENT OF COSTS
AND EXPENSES, INCREASED COSTS AND BREAK FUNDING PAYMENTS WILL CONTINUE IN FULL
FORCE AND EFFECT WITH RESPECT TO, AND FOR THE BENEFIT OF, EACH EXISTING TRANCHE
B TERM LOAN LENDER AND EACH EXISTING FUNDED L/C PARTICIPANT IN RESPECT OF SUCH
LENDER’S TRANCHE B TERM LOANS AND FUNDED LETTER OF CREDIT COMMITMENTS EXISTING
UNDER THE CREDIT AGREEMENT PRIOR TO THE AMENDMENT EFFECTIVE DATE.

3.             ADDITIONAL AMENDMENTS.  SUBJECT TO THE SATISFACTION OF THE
CONDITIONS SET FORTH IN SECTIONS 4 AND 5 HEREOF,

8

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(A)           THE DEFINITION OF “APPLICABLE MARGIN” SET FORTH IN SECTION 1.1 OF
THE CREDIT AGREEMENT IS HEREBY FURTHER AMENDED AND RESTATED AS FOLLOWS (AND SUCH
AMENDMENT SHALL SUPERSEDE THE AMENDMENT SET FORTH IN SECTION 1(C) OF THIS
AMENDMENT):

“Applicable Margin”:  for each Type of Loan under each Facility, the rate per
annum set forth opposite such Facility under the relevant column heading below:

 

Eurodollar 
Loans

 

Base Rate
Loans

 

Revolving Credit Facility

 

2.50

%

1.50

%

Swing Line Loans

 

—

 

1.50

%

Tranche C Term Loan Facility

 

2.50

%

1.50

%

 

provided, that on and after the first date on which the Facilities are rated by
both S&P and Moody’s, the Applicable Margins will be determined pursuant to the
Pricing Grid.

(B)           THE DEFINITION OF “COMMITMENT FEE RATE” SET FORTH IN SECTION 1.1
OF THE CREDIT AGREEMENT IS AMENDED TO REPLACE THE PERCENTAGE “0.50%” THEREIN
WITH THE PERCENTAGE “0.375%”.

4.             CONDITIONS TO EFFECTIVENESS.  THE EFFECTIVENESS OF ALL THE
AMENDMENTS CONTAINED IN SECTIONS 1 AND 3 OF THIS AMENDMENT ARE CONDITIONED UPON
SATISFACTION OF THE FOLLOWING CONDITIONS PRECEDENT (THE DATE ON WHICH ALL SUCH
CONDITIONS PRECEDENT HAVE BEEN SATISFIED BEING REFERRED TO HEREIN AS THE
“AMENDMENT EFFECTIVE DATE”):

(A)           THE ADMINISTRATIVE AGENT SHALL HAVE RECEIVED SIGNED, WRITTEN
AUTHORIZATION FROM THE REQUIRED LENDERS AND THE MAJORITY FACILITY LENDERS WITH
RESPECT TO THE EXISTING FUNDED L/C FACILITY AND THE TRANCHE B TERM FACILITY TO
EXECUTE THIS AMENDMENT, AND SHALL HAVE RECEIVED COUNTERPARTS OF THIS AMENDMENT
SIGNED BY EACH OF THE BORROWER, THE GUARANTORS AND THE ADMINISTRATIVE AGENT;

(B)           EACH OF THE REPRESENTATIONS AND WARRANTIES CONTAINED IN SECTION 6
BELOW SHALL BE TRUE AND CORRECT IN ALL MATERIAL RESPECTS ON AND AS OF THE
AMENDMENT EFFECTIVE DATE;

(C)           THE ADMINISTRATIVE AGENT SHALL HAVE RECEIVED (I) COMMITMENTS FROM
BANKS AND OTHER FINANCIAL INSTITUTIONS WITH RESPECT TO THE TRANCHE C TERM LOANS
IN AN AGGREGATE PRINCIPAL AMOUNT EQUAL TO $397,000,000, (II) COMMITMENTS FROM
BANKS AND OTHER FINANCIAL INSTITUTIONS WITH RESPECT TO THE FUNDED LETTER OF
CREDIT COMMITMENTS IN AN AGGREGATE PRINCIPAL AMOUNT EQUAL TO $82,500,000 AND
(III) AS APPLICABLE, (X) A FULLY EXECUTED LENDER ADDENDUM WITH RESPECT TO EACH
SUCH BANK OR OTHER FINANCIAL INSTITUTION COMMITTING TO FUND SUCH TRANCHE C TERM
LOANS OR TO MAKE A DEPOSIT WITH RESPECT TO ITS FUNDED LETTER OF CREDIT
COMMITMENTS (AND PURSUANT TO WHICH, ON THE AMENDMENT EFFECTIVE DATE, SUCH BANK
OR OTHER FINANCIAL INSTITUTION SHALL BECOME A TRANCHE C TERM LOAN LENDER OR A
FUNDED L/C PARTICIPANT, AS APPLICABLE, FOR ALL PURPOSES UNDER THE CREDIT
AGREEMENT) OR (Y) A FULLY EXECUTED CONVERSION NOTICE WITH RESPECT TO EACH
EXISTING LENDER ELECTING TO CONVERT ITS TRANCHE B TERM LOANS INTO TRANCHE C TERM
LOANS AND EACH EXISTING FUNDED L/C PARTICIPANT ELECTING TO CONVERT ITS
REVERSIONARY INTEREST IN THE EXISTING CREDIT LINKED DEPOSIT INTO A REVERSIONARY
INTEREST IN THE CREDIT LINKED DEPOSIT ESTABLISHED BY THE REVOLVING
ADMINISTRATIVE AGENT ON THE AMENDMENT EFFECTIVE DATE (THE “SECOND AMENDMENT
CREDIT LINKED DEPOSIT”) (AND PURSUANT TO WHICH ON THE AMENDMENT EFFECTIVE DATE
ALL OF THE OUTSTANDING PRINCIPAL AMOUNT OF TRANCHE B TERM LOANS HELD BY SUCH
LENDER SHALL CONVERT INTO TRANCHE C TERM LOANS, AND EXISTING CREDIT LINKED
DEPOSIT SHALL CONVERT INTO THE SECOND AMENDMENT CREDIT LINKED DEPOSIT, AS
APPLICABLE); IT BEING AGREED AND UNDERSTOOD THAT DELIVERY OF A FULLY EXECUTED
CONVERSION

9

--------------------------------------------------------------------------------

NOTICE BY A LENDER SHALL BE DEEMED TO CONSTITUTE AN AUTHORIZATION BY SUCH LENDER
DIRECTING THE ADMINISTRATIVE AGENT TO EXECUTE THIS AMENDMENT;

(D)           EACH OF THE FUNDED L/C PARTICIPANTS THAT IS A CONTINUING LENDER OR
AN ADDITIONAL LENDER SHALL HAVE COMPLIED WITH ITS OBLIGATION TO DEPOSIT CASH IN
AN AMOUNT EQUIVALENT TO SUCH FUNDED L/C PARTICIPANT’S FUNDED LETTER OF CREDIT
COMMITMENT (INCLUDING BY WAY OF CONVERSION) WITH THE REVOLVING ADMINISTRATIVE
AGENT AS PROVIDED IN SECTION 2(C) HEREOF;

(E)           THE ADMINISTRATIVE AGENT SHALL HAVE RECEIVED ALL FEES AND OTHER
AMOUNTS DUE AND PAYABLE ON OR PRIOR TO THE AMENDMENT EFFECTIVE DATE, INCLUDING,
TO THE EXTENT INVOICED, REIMBURSEMENT OR OTHER PAYMENT OF ALL OUT-OF-POCKET
EXPENSES REQUIRED TO BE REIMBURSED OR PAID BY THE BORROWER HEREUNDER OR ANY
OTHER LOAN DOCUMENT;

(F)            THE BORROWER SHALL HAVE PROVIDED IRREVOCABLE NOTICE OF THE
TERMINATION OF THE EXISTING FUNDED L/C FACILITY IMMEDIATELY PRIOR TO THE
EFFECTIVENESS OF THIS AMENDMENT; AND

(G)           THE ADMINISTRATIVE AGENT SHALL HAVE RECEIVED SUCH OTHER DOCUMENTS,
INSTRUMENTS, CERTIFICATES AND APPROVALS AS IT MAY REASONABLY REQUEST.

5.             ADDITIONAL CONDITIONS.  THE EFFECTIVENESS OF ALL THE AMENDMENTS
CONTAINED IN SECTION 3 OF THIS AMENDMENT ARE FURTHER CONDITIONED UPON THE
ADMINISTRATIVE AGENT’S RECEIPT OF SIGNED, WRITTEN AUTHORIZATION FROM EACH OF THE
REVOLVING CREDIT LENDERS TO EXECUTE THIS AMENDMENT.

6.             REPRESENTATIONS AND WARRANTIES.  THE BORROWER REPRESENTS AND
WARRANTS TO THE ADMINISTRATIVE AGENT AND THE LENDERS AS FOLLOWS:

(A)           AUTHORITY.  THE BORROWER HAS THE CORPORATE POWER AND AUTHORITY,
AND THE LEGAL RIGHT, TO MAKE, DELIVER AND PERFORM THIS AMENDMENT AND TO PERFORM
ITS OBLIGATIONS HEREUNDER AND UNDER THE LOAN DOCUMENTS (AS AMENDED HEREBY). 
EACH OF THE GUARANTORS HAS THE CORPORATE OR OTHER ORGANIZATIONAL POWER AND
AUTHORITY, AND THE LEGAL RIGHT, TO MAKE, DELIVER AND PERFORM THIS AMENDMENT. 
THE EXECUTION, DELIVERY AND PERFORMANCE BY THE BORROWER AND GUARANTORS OF THIS
AMENDMENT AND THE LOAN DOCUMENTS (AS AMENDED HEREBY) AND THE TRANSACTIONS
CONTEMPLATED HEREBY AND THEREBY HAVE BEEN AUTHORIZED BY ALL NECESSARY CORPORATE
OR OTHER ORGANIZATIONAL ACTION OF SUCH PERSON.  NO MATERIAL CONSENT OR
AUTHORIZATION OF, FILING WITH, NOTICE TO OR OTHER ACT BY OR IN RESPECT OF, ANY
GOVERNMENTAL AUTHORITY OR ANY OTHER PERSON IS REQUIRED IN CONNECTION WITH THE
EXECUTION, DELIVERY, PERFORMANCE, VALIDITY OR ENFORCEABILITY OF THIS AMENDMENT.

(B)           ENFORCEABILITY.  THIS AMENDMENT HAS BEEN DULY EXECUTED AND
DELIVERED ON BEHALF OF EACH LOAN PARTY THAT IS PARTY THERETO.  EACH OF THIS
AMENDMENT AND EACH LOAN DOCUMENT AS AMENDED HEREBY (I) CONSTITUTES A LEGAL,
VALID AND BINDING OBLIGATION OF EACH LOAN PARTY HERETO, ENFORCEABLE AGAINST EACH
SUCH LOAN PARTY IN ACCORDANCE WITH ITS TERMS, EXCEPT AS ENFORCEABILITY MAY BE
LIMITED BY APPLICABLE BANKRUPTCY, INSOLVENCY, REORGANIZATION, MORATORIUM OR
SIMILAR LAWS AFFECTING THE ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY AND BY
GENERAL EQUITABLE PRINCIPLES (WHETHER ENFORCEMENT IS SOUGHT BY PROCEEDINGS IN
EQUITY OR AT LAW) AND (II) IS IN FULL FORCE AND EFFECT.  NEITHER THE EXECUTION,
DELIVERY OR PERFORMANCE OF THIS AMENDMENT OR THE PERFORMANCE OF THE LOAN
DOCUMENTS (AS AMENDED HEREBY), NOR THE PERFORMANCE OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY, WILL ADVERSELY AFFECT THE VALIDITY, PERFECTION
OR PRIORITY OF THE COLLATERAL AGENT’S LIEN ON ANY OF THE COLLATERAL OR ITS
ABILITY TO REALIZE THEREON.  THIS AMENDMENT IS EFFECTIVE TO AMEND THE CREDIT
AGREEMENT AS PROVIDED HEREIN.

(C)           GUARANTY OBLIGATIONS.  EACH OF THE SIGNATORIES HERETO WHO HAVE
EXECUTED THIS AMENDMENT UNDER THE CAPTION “GUARANTORS” IS A GUARANTOR OF THE
OBLIGATIONS OF THE BORROWER UNDER THE

10

--------------------------------------------------------------------------------

CREDIT AGREEMENT AND HEREBY (I) ACKNOWLEDGES THAT NOTWITHSTANDING THE EXECUTION
AND DELIVERY OF THIS AMENDMENT, THE OBLIGATIONS OF EACH OF THE UNDERSIGNED
GUARANTORS ARE NOT IMPAIRED OR AFFECTED AND ALL GUARANTIES GIVEN TO THE HOLDERS
OF OBLIGATIONS AND ALL LIENS GRANTED AS SECURITY FOR THE OBLIGATIONS CONTINUE IN
FULL FORCE AND EFFECT, AND (II) CONFIRMS AND RATIFIES ITS OBLIGATIONS UNDER THE
GUARANTEE AND COLLATERAL AGREEMENT AND EACH OTHER LOAN DOCUMENT EXECUTED BY IT.

(D)           REPRESENTATIONS AND WARRANTIES.  AFTER GIVING EFFECT TO THIS
AMENDMENT, THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THE CREDIT AGREEMENT
AND THE OTHER LOAN DOCUMENTS (OTHER THAN ANY SUCH REPRESENTATIONS AND WARRANTIES
THAT, BY THEIR TERMS, ARE SPECIFICALLY MADE AS OF AN EARLIER DATE) ARE TRUE AND
CORRECT IN ALL MATERIAL RESPECTS ON AND AS OF THE DATE HEREOF AS THOUGH MADE ON
AND AS OF THE DATE HEREOF.

(E)           NO CONFLICTS.  NEITHER THE EXECUTION, DELIVERY AND PERFORMANCE OF
THIS AMENDMENT, NOR THE PERFORMANCE OF AND COMPLIANCE WITH THE TERMS AND
PROVISIONS HEREOF OR OF THE LOAN DOCUMENTS (AS AMENDED HEREBY) BY ANY LOAN PARTY
WILL, AT THE TIME OF SUCH PERFORMANCE, (I) VIOLATE ANY REQUIREMENT OF LAW OR ANY
MATERIAL CONTRACTUAL OBLIGATION OF ANY LOAN PARTY OR (II) RESULT IN, OR REQUIRE,
THE CREATION OR IMPOSITION OF ANY LIEN (OTHER THAN LIENS CREATED BY THE LOAN
DOCUMENTS) ON ANY OF THEIR RESPECTIVE PROPERTIES OR REVENUES PURSUANT TO ANY
REQUIREMENT OF LAW OR ANY SUCH CONTRACTUAL OBLIGATION.

(F)            NO DEFAULT.  AFTER GIVING EFFECT TO THIS AMENDMENT, NO EVENT HAS
OCCURRED AND IS CONTINUING THAT CONSTITUTES A DEFAULT OR EVENT OF DEFAULT.

7.             REFERENCE TO AND EFFECT ON CREDIT AGREEMENT.

(A)           UPON AND AFTER THE EFFECTIVENESS OF THIS AMENDMENT, EACH REFERENCE
IN THE CREDIT AGREEMENT TO “THIS AGREEMENT”, “HEREUNDER”, “HEREOF” OR WORDS OF
LIKE IMPORT REFERRING TO THE CREDIT AGREEMENT, AND EACH REFERENCE IN THE OTHER
LOAN DOCUMENTS TO “THE CREDIT AGREEMENT”, “THEREUNDER”, “THEREOF” OR WORDS OF
LIKE IMPORT REFERRING TO THE CREDIT AGREEMENT, SHALL MEAN AND BE A REFERENCE TO
THE CREDIT AGREEMENT AS AMENDED HEREBY.  THIS AMENDMENT IS A LOAN DOCUMENT.

(B)           EXCEPT AS SPECIFICALLY AMENDED ABOVE, THE CREDIT AGREEMENT AND THE
OTHER LOAN DOCUMENTS ARE AND SHALL CONTINUE TO BE IN FULL FORCE AND EFFECT AND
ARE HEREBY IN ALL RESPECTS RATIFIED AND CONFIRMED.  WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, THE SECURITY DOCUMENTS AND ALL OF THE COLLATERAL
DESCRIBED THEREIN DO AND SHALL CONTINUE TO SECURE THE PAYMENT OF ALL OBLIGATIONS
UNDER AND AS DEFINED THEREIN.

(C)           THE EXECUTION, DELIVERY AND EFFECTIVENESS OF THIS AMENDMENT SHALL
NOT, EXCEPT AS EXPRESSLY PROVIDED HEREIN, OPERATE AS A WAIVER OF ANY RIGHT,
POWER OR REMEDY OF ANY SECURED PARTY UNDER ANY OF THE LOAN DOCUMENTS, NOR,
EXCEPT AS EXPRESSLY PROVIDED HEREIN, CONSTITUTE A WAIVER OR AMENDMENT OF ANY
PROVISION OF ANY OF THE LOAN DOCUMENTS.

8.             COUNTERPARTS.  THIS AMENDMENT MAY BE EXECUTED IN ANY NUMBER OF
COUNTERPARTS AND BY DIFFERENT PARTIES HERETO IN SEPARATE COUNTERPARTS, EACH OF
WHICH WHEN SO EXECUTED AND DELIVERED SHALL BE DEEMED TO BE AN ORIGINAL AND ALL
OF WHICH TAKEN TOGETHER SHALL CONSTITUTE ONE AND THE SAME AGREEMENT.  DELIVERY
OF AN EXECUTED COUNTERPART OF A SIGNATURE PAGE TO THIS AMENDMENT BY FACSIMILE
SHALL BE EFFECTIVE AS DELIVERY OF A MANUALLY EXECUTED COUNTERPART OF THIS
AMENDMENT.

9.             SEVERABILITY.  ANY PROVISION OF THIS AMENDMENT THAT IS PROHIBITED
OR UNENFORCEABLE IN ANY JURISDICTION SHALL, AS TO SUCH JURISDICTION, BE
INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION OR UNENFORCEABILITY WITHOUT
INVALIDATING THE REMAINING PROVISIONS HEREOF, AND ANY SUCH PROHIBITION OR

11

--------------------------------------------------------------------------------

UNENFORCEABILITY IN ANY JURISDICTION SHALL NOT INVALIDATE OR RENDER
UNENFORCEABLE SUCH PROVISION IN ANY OTHER JURISDICTION.

10.           GOVERNING LAW.  THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

[Signature pages follow]

12

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their respective officers thereunto duly authorized, as of the date first
written above.

ADMINISTRATIVE AGENT AND COLLATERAL AGENT:

 

 

 

LEHMAN COMMERCIAL PAPER INC.

 

 

 

 

 

By:

              /s/ Maria M. Lund

 

 

Name:

Maria M. Lund

 

 

Title:

Authorized Signatory

 

 

 

 

 

 

 

REVOLVING ADMINISTRATIVE AGENT AND ISSUING LENDER:

 

 

 

WELLS FARGO FOOTHILL, INC.

 

 

 

By:

             /s/ Kristy S. Loucks

 

 

Name:

Kristy S. Loucks

 

 

Title:

Vice President

 

 

 

BORROWER:

 

 

 

KEY ENERGY SERVICES, INC.

 

 

 

 

 

By:

              /s/ William M. Austin

 

 

Name:

William M. Austin

 

 

 

 

 

 

Title:

Senior Vice President and Chief Financial Officer

 

[Signature Page to Second Amendment]|

--------------------------------------------------------------------------------

 

GUARANTORS:

 

 

 

BROOKS WELL SERVICING, INC.

 

DAWSON PRODUCTION MANAGEMENT, INC.

 

KALKASKA OILFIELD SERVICES, INC.

 

KEY ENERGY DRILLING, INC.

 

KEY ENERGY SERVICES-CALIFORNIA, INC.

 

KEY ENERGY SERVICES-SOUTH TEXAS, INC.

 

KEY ROCKY MOUNTAIN, INC.

 

Q SERVICES, INC.

 

Q.V. SERVICES, INC.

 

UNITRAK SERVICES HOLDING, INC.

 

WATSON OILFIELD SERVICE & SUPPLY, INC.

 

WELL-CO OIL SERVICE, INC.

 

WELLTECH EASTERN, INC.

 

WELLTECH MID-CONTINENT, INC.

 

YALE E. KEY, INC.

 

 

 

 

 

By:

/s/ William M. Austin

 

 

 

Name:  William M. Austin

 

 

Title:    Vice President

 

 

 

 

 

 

 

DAWSON PRODUCTION TAYLOR, INC.

 

DAWSON PRODUCTION ACQUISITION CORP.

 

 

 

 

 

By:

/s/ William M. Austin

 

 

 

Name:  William M. Austin

 

 

Title:    Vice President

 

 

 

 

 

 

 

MISR. KEY ENERGY SERVICES, LLC

 

MISR. KEY ENERGY INVESTMENTS, LLC

 

 

 

 

 

By:

/s/ William M. Austin

 

 

 

Name:  William M. Austin

 

 

Title:    Vice President

 

[Signature Page to Second Amendment]|

--------------------------------------------------------------------------------

 

GUARANTORS (continued):

 

 

 

BROOKS WELL SERVICING BENEFICIAL, L.P.

 

by the sole general partner,

 

Brooks Well Servicing, Inc.

 

DAWSON PRODUCTION PARTNERS, L.P.

 

by the sole general partner

 

Dawson Production Management, Inc.

 

KEY ENERGY DRILLING BENEFICIAL, L.P.

 

by the sole general partner,

 

Key Energy Drilling, Inc.

 

Q.V. SERVICES BENEFICIAL, L.P.

 

by the sole general partner,

 

Q.V. Services, Inc.

 

UNITRAK SERVICES, L.P.

 

by the sole general partner,

 

UniTrak Services Holding, Inc.

 

WELLTECH MID-CONTINENT BENEFICIAL, L.P.

 

by the sole general partner,

 

WellTech Mid-Continent, Inc.

 

YALE E. KEY BENEFICIAL, L.P.

 

by the sole general partner,

 

Yale E. Key, Inc.

 

 

 

 

 

By:

/s/ William M. Austin

 

 

 

Name:  William M. Austin

 

 

Title:    Vice President

 

[Signature Page to Second Amendment]|

--------------------------------------------------------------------------------

 

GUARANTORS (continued):

 

 

 

KEY ENERGY PRESSURE PUMPING SERVICES, L.P.

 

by the sole general partner,

 

Q Oil & Gas Services, LLC

 

Q PRODUCTION SERVICES, L.P.

 

by the sole general partner,

 

Q Oil & Gas Services, LLC

 

QUALITY OIL FIELD SERVICES, L.P.

 

by the sole general partner,

 

Q Oil & Gas Services, LLC

 

KEY ENERGY FISHING & RENTAL SERVICES, L.P.

 

by the sole general partner,

 

Q Oil & Gas Services, LLC

 

Q.V. SERVICES OF TEXAS, L.P.

 

by the sole general partner,

 

Q Oil & Gas Services, LLC

 

 

 

By:

/s/ William M. Austin

 

 

 

Name:  William M. Austin

 

 

Title:    Vice President

 

[Signature Page to Second Amendment]|

--------------------------------------------------------------------------------

 

GUARANTORS (continued):

 

 

 

BROOKS WELL SERVICING, LLC

 

KEY ENERGY DRILLING, LLC

 

Q ENERGY SERVICES, L.L.C.

 

Q OIL & GAS SERVICES, LLC

 

Q.V. SERVICES, LLC

 

UNITRAK SERVICES, LLC

 

YALE E. KEY, LLC

 

WELLTECH MID-CONTINENT, LLC

 

 

 

By:

/s/ William M. Austin

 

 

 

Name:  William M. Austin

 

 

Title:    Manager

 

 

 

 

 

 

 

KEY ENERGY SHARED SERVICES, LLC

 

 

 

 

 

By:

/s/ William M. Austin

 

 

 

Name:  William M. Austin

 

 

Title:    Vice President

 

[Signature Page to Second Amendment]|

--------------------------------------------------------------------------------

Exhibit A

CONVERSION NOTICE
[TO BE COMPLETED FOR EACH FUND]

Reference is made to the Second Amendment (the “Second Amendment”), dated as of
November 21, 2006 to the Credit Agreement, dated as of July 29, 2005 (as amended
from time to time prior to the date hereof, the “Credit Agreement”), among Key
Energy Services, Inc., the banks and other financial institutions and entities
from time to time party thereto (the “Lenders”), Wells Fargo Foothill, Inc., as
revolving administrative agent, and Lehman Commercial Paper Inc., as
administrative agent for the Lenders (in such capacity, the “Administrative
Agent”) and as Collateral Agent for the Lenders and other Secured Parties (in
such capacity, the “Collateral Agent”).  Capitalized terms used but not
otherwise defined herein are used with the meanings attributed thereto in the
Credit Agreement.

[The undersigned Lender hereby irrevocably and unconditionally elects to convert
$[                                ] of the outstanding principal amount of the
Tranche B Term Loan held by such Lender into a Tranche C Term Loan (as defined
in the Second Amendment) in a principal amount equal to the amount of the
Tranche B Term Loan converted hereby, effective only if, and only as and when
the Second Amendment becomes effective in accordance with its terms.]

[The undersigned Lender hereby irrevocably and unconditionally elects to convert
$[                            ] of the outstanding principal amount of Credit
Linked Deposit Account applicable to such Lender (its “Credit Linked Deposit
Amount”) into a cash deposit for the Credit Linked Deposit Account established
in connection with the Second Amendment in an amount equal to the amount of the
Credit Linked Deposit Amount converted hereby, effective only if, and only as
and when the Second Amendment becomes effective in accordance with its terms.]

This Conversion Notice shall be governed by, and construed and interpreted in
accordance with, the laws of the state of New York.

This Conversion Notice may be executed by the parties hereto on any number of
separate counterparts, and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.  Delivery of an executed
signature page hereof by facsimile transmission shall be effective as delivery
of a manually executed counterpart hereof.

By executing this Conversion Notice, the undersigned Lender hereby irrevocably
and unconditionally consents to the Second Amendment and authorizes the
Administrative Agent to execute the Second Amendment on its behalf.

[remainder of page intentionally left blank]

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have caused the Conversion Notice to be
duly executed and delivered by their proper and duly authorized officers as of
this        day of November, 2006.

 

[INSERT NAME OF LENDER]

 

 

 

 

 

By:

 

 

 

Name:

 

Title:

 

[Signature Page to Conversion Notice]|

--------------------------------------------------------------------------------

 

ADMINISTRATIVE AGENT AND COLLATERAL AGENT:

 

LEHMAN COMMERCIAL PAPER INC.

 

By:

 

 

 

Title:

 

[Signature Page to Conversion Notice]|

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Exhibit B

FORM OF LENDER ADDENDUM

LENDER ADDENDUM, dated as of                                    , 200     (this
“Lender Addendum”), to the Credit Agreement, dated as of July 29, 2005 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Key Energy Services, Inc., the banks and other financial
institutions and entities from time to time party thereto (the “Lenders”), Wells
Fargo Foothill, Inc., as revolving administrative agent, and Lehman Commercial
Paper Inc., as administrative agent for the Lenders (in such capacity, the
“Administrative Agent”) and as Collateral Agent for the Lenders and other
Secured Parties (in such capacity, the “Collateral Agent”).  Unless otherwise
defined herein, terms defined in the Credit Agreement and used herein shall have
the meanings given to them in the Credit Agreement.

W I T N E S S E T H :

WHEREAS, the Credit Agreement provides that any bank, financial institution or
other entity may become a party to the Credit Agreement with the consent of the
Borrower and the Administrative Agent (which consent, in the case of the
Administrative Agent, shall not be unreasonably withheld) by executing and
delivering to the Borrower and the Administrative Agent a supplement to the
Credit Agreement in substantially the form of this Lender Addendum; and

WHEREAS, the undersigned now desires to become a party to the Credit Agreement
as a Lender thereunder;

NOW, THEREFORE, the undersigned hereby agrees as follows:

1.             The undersigned agrees to be bound by the provisions of the
Credit Agreement, and agrees that it shall, on the date this Lender Addendum is
accepted by the Borrower and the Administrative Agent, become a Lender for all
purposes of the Credit Agreement to the same extent as if originally a party
thereto, with [a commitment under the Tranche C Term Loan Facility of
$[                           ]][a Funded Letter of Credit Commitment of 
$[                           ]].

2.             The undersigned (a) represents and warrants that it is legally
authorized to enter into this Lender Addendum; (b) confirms that it has received
a copy of the Credit Agreement and each other Loan Document existing as of the
date of this Lender Addendum, together with copies of the financial statements
referred to in Section 6.1 of the Credit Agreement and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Lender Addendum; (c) agrees that it has made and
will, independently and without reliance upon the Administrative Agent, any
other agent or any other Lender and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Credit Agreement or any instrument or
document furnished pursuant hereto or thereto; (d) appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers and discretion under the Credit Agreement or any instrument or
document furnished pursuant hereto or thereto as are delegated to the
Administrative Agent by the terms thereof, together with such powers as are
incidental thereto; and (e) agrees that it will be bound by the provisions of
the Credit Agreement and each of the other Loan Documents and will perform in
accordance with their terms all the obligations which by the terms of the Credit
Agreement or the other Loan Documents are required to be performed by it as a
Lender including, without limitation, if it is organized under the laws of a
jurisdiction outside the United States, its obligations pursuant to Section 2.20
of the Credit Agreement.

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3.             The undersigned’s address for notices for the purposes of the
Credit Agreement is as follows:

Name of Lender:

 

 

Notice Address:

 

 

 

 

 

 

 

 

Attention:

 

 

Telephone:

 

 

Facsimile:

 

 

 

[remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the undersigned has caused this Lender Addendum to be
executed and delivered by a duly authorized officer on the date first above
written.

 

[INSERT NAME OF LENDER]

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

[Signature Page to Lender Addendum]

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Accepted this       day of

                                     , 200  

KEY ENERGY SERVICES, INC.

 

 

By:

 

 

 

Title:

 

 

 

 

 

 

 

ADMINISTRATIVE AGENT AND COLLATERAL AGENT:

 

LEHMAN COMMERCIAL PAPER INC.

 

By:

 

 

 

Title:

 

 

[Signature Page to Lender Addendum]

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