Exhibit 4.2


 


REGISTRATION RIGHTS AGREEMENT


 


KEY ENERGY SERVICES, INC.


 


$425,000,000 8.375% Senior Notes due 2014


 


This Registration Rights Agreement (this “Agreement”) is made and entered into as
of November 29, 2007 by and among Key Energy Services, Inc., a Maryland
corporation (the “Company”),
the subsidiaries of the Company party hereto (each a “Guarantor” and
collectively, the “Guarantors”),
and Lehman Brothers Inc., Banc of America Securities LLC and Morgan Stanley
& Co. Incorporated, as representatives of the several initial purchasers
named in the Purchase Agreement (the “Purchasers”), who have agreed to purchase
$425,000,000 aggregate amount of the Company’s 8.375% Senior Notes due 2014
(the “Initial Notes”)
pursuant to and subject to the terms and conditions of that certain Purchase
Agreement, dated November 14, 2007 (the “Purchase Agreement”), among the Company,
the Guarantors and the Purchasers. In order to induce the Purchasers to
purchase the Initial Notes, the Company and the Guarantors have agreed to
provide the registration rights set forth in this Agreement. The execution and
delivery of this Agreement is a condition to the obligation of the Purchasers
to purchase the Initial Notes pursuant to the Purchase Agreement.


 


1.                                  Definitions.
 As used in this Agreement, the
following capitalized terms shall have the following meanings:


 


Additional Interest:  As defined in Section 5 hereof.


 


Advice:  As defined in Section 6(d) hereof.


 


Affiliate:  With respect to any specified Person, “Affiliate” shall mean
any other Person directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified Person. For the purposes
of this definition, “control,”
when used with respect to any Person, means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise and the terms “affiliated,” “controlling” and “controlled” have
meanings correlative to the foregoing.


 


Broker-Dealer:  Any broker or dealer registered under the
Exchange Act.


 


Broker-Dealer Transfer Restricted
Securities:  Exchange
Notes that are acquired by a Broker-Dealer in the Exchange Offer in exchange
for Initial Notes that such Broker-Dealer acquired for its own account as a
result of market-making activities or other trading activities (other than
Initial Notes acquired directly from the Company or any of its Affiliates).


 


Business Day:  As defined in the Indenture.


 


Closing Date:  The date on which the Initial Notes are
initially issued.


 


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Commission:  The United States Securities and Exchange
Commission, or any other federal agency at the time administering the Exchange
Act or the Securities Act, whichever is the relevant statute for the particular
purpose.


 


Consummate:  The Exchange Offer shall be deemed “Consummated” for
purposes of this Agreement upon the occurrence of (i) the filing and
effectiveness under the Securities Act of the Exchange Offer Registration
Statement relating to the Exchange Notes to be issued in the Exchange Offer,
(ii) the maintenance of such Exchange Offer Registration Statement continuously
effective and the keeping of the Exchange Offer open for a period not less than
the minimum period required pursuant to Section 3(b) hereof, and (iii) the
delivery by the Company to the Trustee of Exchange Notes in the same aggregate
principal amount as the aggregate principal amount of Initial Notes that were
tendered by Holders thereof pursuant to the Exchange Offer.


 


Effectiveness Target Date:  As defined in
Section 5 hereof.


 


Effective Time:  In the case of (i) an Exchange Offer
Registration Statement, shall mean the time and date as of which the Commission
declares the Exchange Offer Registration Statement effective or as of which the
Exchange Offer Registration Statement otherwise becomes effective and (ii) a
Shelf Registration Statement, shall mean the time and date as of which the
Commission declares the Shelf Registration Statement effective or as of which
the Shelf Registration Statement otherwise becomes effective.


 


Exchange Act:  The Securities Exchange Act of 1934, as
amended, or any successor statute and the rules and regulations promulgated
thereunder.


 


Exchange Notes:  The Company’s 8.375%
Senior Notes due 2014 to be issued pursuant to the Indenture (i) in the
Exchange Offer or (ii) upon the request of any Holder of Initial Notes covered
by a Shelf Registration Statement, in exchange for such Initial Notes. Each
Note is entitled to the benefit of the guarantee provided for in the Indenture
(the “Guarantee”)
and, unless the context otherwise requires, any reference herein to a “Note,” an “Initial Note,” an “Exchange Note” or a “Transfer Restricted Security”
shall include a reference to the related Guarantee.


 


Exchange Offer:  The registration by the Company under the
Securities Act of the Exchange Notes pursuant to the Exchange Offer
Registration Statement pursuant to which the Company offers the Holders of all
outstanding Transfer Restricted Securities the opportunity to exchange all such
outstanding Transfer Restricted Securities held by such Holders for Exchange
Notes in an aggregate principal amount equal to the aggregate principal amount
of the Transfer Restricted Securities tendered in such exchange offer by such
Holders.


 


Exchange Offer Registration Statement:  The Registration Statement relating to the
Exchange Offer, including the related Prospectus.


 


FINRA: 
The Financial Industry Regulatory Authority
(formerly known as the National Association of Securities Dealers, Inc.).


 


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Free Writing Prospectus:
Each free writing prospectus (as defined in Rule 405 under the Securities Act)
prepared by or on behalf of the Company (or any of its agents or
representatives) or used or referred to by the Company (or any of its agents or
representatives) in connection with the sale of the Initial Notes or the
Exchange Notes.


 


Holder:  As defined in Section 2(b) hereof.


 


indemnified party:  As defined in Section 8(c) hereof.


 


indemnifying party:  As defined in Section 8(c) hereof.


 


Indenture:  The Indenture, dated as of November 29, 2007,
among the Company, the Guarantors the Trustee, pursuant to which the Notes are
to be issued, as such Indenture is amended or supplemented from time to time in
accordance with the terms thereof.


 


Notes: 
The Initial Notes and the Exchange Notes.


 


Person:  An individual, partnership, corporation,
limited liability company, joint venture, association, joint- stock company,
trust or unincorporated organization, or a government or agency or political
subdivision thereof or any other entity.


 


Prospectus:  The prospectus included in a Registration
Statement at the time such Registration Statement is declared or becomes effective,
as amended or supplemented by any prospectus supplement and by all other
amendments thereto, including post-effective amendments, and all material
incorporated by reference into such Prospectus.


 


Registration Default:  As defined in Section 5 hereof.


 


Registration Statement:  Any registration statement of the Company and
the Guarantors relating to (a) an offering of Exchange Notes pursuant to the
Exchange Offer or (b) the registration for resale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement, in each case (i) which
is filed pursuant to the provisions of this Agreement and (ii) including the
Prospectus included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference therein.


 


Restricted Broker-Dealer:
Any Broker-Dealer that holds Broker-Dealer Transfer Restricted Securities.


 


Securities Act:  The Securities Act of 1933, as amended, or
any successor statute and the rules and regulations promulgated thereunder.


 


Shelf Filing Deadline:  As defined in Section 4 hereof.


 


Shelf Registration Statement:  As defined in Section 4 hereof.


 


TIA:  The Trust Indenture Act of 1939, as amended
(15 U.S.C. Section 77aaa-77bbbb), as amended, or any successor statute and the
rules and regulations promulgated thereunder.


 


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Transfer Restricted Securities:  Each Initial Note, until the earliest to
occur of (a) the date on which such Initial Note is exchanged in the Exchange
Offer for an Exchange Note by a Person other than a Broker-Dealer, (b) the date
on which such Initial Note has been effectively registered under the Securities
Act and disposed of in accordance with the Shelf Registration Statement, (c)
the date on which such Initial Note is distributed to the public pursuant to
Rule 144 under the Securities Act, (d) following the exchange of such
Initial Notes for a Broker-Dealer Transfer Restricted Security, the date on
which such Broker-Dealer Transfer Restricted Security is distributed by a
Broker-Dealer pursuant to the “Plan of Distribution” (or similar provision)
section contemplated by the Exchange Offer Registration Statement (including
delivery of the Prospectus contained therein) and (e) the date on which such
Initial Note ceases to be outstanding.


 


Trustee: 
The Bank of New York Trust Company, N.A., the
trustee under Indenture.


 


Underwritten Registration or Underwritten
Offering:  A
registration in which Notes are sold to an underwriter for reoffering to the
public.


 


2.                                      Securities
Subject to this Agreement.


 


(a)          Transfer
Restricted Securities. The securities entitled to the benefits of
this Agreement are the Transfer Restricted Securities.


 


(b)         Holders of
Transfer Restricted Securities. A Person is deemed to be a holder of
Transfer Restricted Securities (each, a “Holder”) whenever such Person owns Transfer
Restricted Securities.


 


3.                                      Registered
Exchange Offer.


 


(a)                                  Unless
the Exchange Offer shall not be permissible under applicable law or Commission
policy (after the procedures set forth in Section 6(a) below have been complied
with), the Company and the Guarantors shall (i) cause to be filed with the
Commission no later than 180 days after the Closing Date (or if the 180th
day is not a Business Day, the first Business Day thereafter), the Exchange
Offer Registration Statement under the Securities Act relating to the Exchange
Notes and the Exchange Offer, (ii) use their respective reasonable best efforts
to have the Exchange Offer Registration Statement become effective no later
than the one year anniversary of the Closing Date (or if the one-year
anniversary is not a Business Day, the first Business Day thereafter), (iii) in
connection with the foregoing, (A) file all pre-effective amendments to such
Exchange Offer Registration Statement as may be necessary in order to cause
such Exchange Offer Registration Statement to become effective, (B) if
applicable, file a post-effective amendment to such Exchange Offer Registration
Statement pursuant to Rule 430A under the Securities Act and (C) cause all
necessary filings, if any, in connection with the registration and
qualification of the Exchange Notes to be made under the Blue Sky laws of such
jurisdictions as are necessary to permit Consummation of the Exchange Offer and
(iv) upon the effectiveness of such Exchange Offer Registration Statement,
commence the Registered Exchange Offer and use their respective reasonable best
efforts to issue, on or prior to 60 days after the date on which the Exchange
Offer Registration Statement became effective under the


 


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Securities Act, Exchange Notes in exchange
for all Initial Notes tendered prior thereto in the Exchange Offer. The
Exchange Offer Registration Statement shall be on the appropriate form
permitting registration of the Exchange Notes to be offered in exchange for the
Transfer Restricted Securities and to permit sales of Broker-Dealer Transfer
Restricted Securities by Broker-Dealers as contemplated by Section 3(c) below.


 


(b)                                 The
Company and the Guarantors shall use their respective, reasonable best efforts
to cause the Exchange Offer Registration Statement to be effective continuously
during the Exchange Offer and shall keep the Exchange Offer open for a period
of not less than the minimum period required under applicable federal and state
securities laws to Consummate the Exchange Offer; provided, however, that in no event shall such period be
less than 20 Business Days. The Company shall cause the Exchange Offer to comply
with all applicable federal and state securities laws. No securities other than
the Notes shall be included in the Exchange Offer Registration Statement.


 


(c)                                  The
Company and the Guarantors shall include a “Plan of Distribution” (or similar
provision) section in the Prospectus contained in the Exchange Offer
Registration Statement and indicate that any Restricted Broker-Dealer who holds
Initial Notes that are Transfer Restricted Securities and that were acquired
for the account of such Restricted Broker-Dealer as a result of market-making
activities or other trading activities (other than Transfer Restricted
Securities acquired directly from the Company or one of its Affiliates) may
exchange such Initial Notes pursuant to the Exchange Offer; however, such
Broker-Dealer may be deemed to be an “underwriter” within the meaning of the
Securities Act and must, therefore, deliver a prospectus meeting the
requirements of the Securities Act in connection with its initial sale of the
Exchange Notes received by such Broker-Dealer in the Exchange Offer, which
prospectus delivery requirement may be satisfied by the delivery by such
Broker-Dealer of the Prospectus contained in the Exchange Offer Registration
Statement. Such “Plan of Distribution” (or similar provision) section shall
also contain all other information with respect to such resales of
Broker-Dealer Transfer Restricted Securities that the Commission may require in
order to permit such sales pursuant thereto but such “Plan of Distribution” (or
other similar provision) section shall not name any such Broker-Dealer or
disclose the amount of Notes held by any such Broker-Dealer except to the
extent required by the Commission as a result of a change in policy after the
date of this Agreement.


 


The Company and the Guarantors shall use their respective reasonable
best efforts to keep the Exchange Offer Registration Statement continuously
effective, supplemented and amended as required by and subject to the
provisions of Section 6(c) below to the extent necessary to ensure that it is
available for resales of Broker-Dealer Transfer Restricted Securities acquired
by Restricted Broker-Dealers and to ensure that it conforms with the
requirements of this Agreement, the Securities Act and the policies, rules and
regulations of the Commission as announced from time to time, for a period of
180 days from the date on which the Exchange Offer Registration Statement is
declared effective or, if shorter, until all Broker-Dealer Transfer Restricted
Securities have been sold thereunder.


 


The Company shall provide sufficient copies of the latest version of
such Prospectus to such Restricted Broker-Dealers promptly upon request at any
time during such 180 day period (or such shorter period, if applicable) in
order to facilitate such sales.


 


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4.                                  Shelf
Registration.


 


(a)                                  Shelf
Registration. If (i) the Company and the Guarantors are not required to
file an Exchange Offer Registration Statement or to consummate the Exchange
Offer because the Exchange Offer is not permitted by applicable law or
Commission policy (after the procedures set forth in Section 6(a) below have
been complied with) or (ii) any Holder of Transfer Restricted Securities shall
notify the Company and the Guarantors within 20 Business Days of the
Consummation of the Exchange Offer that (A) such Holder is prohibited by
applicable law or Commission policy from participating in the Exchange Offer,
(B) such Holder may not resell the Exchange Notes acquired by it in the Exchange
Offer to the public without delivering a prospectus and that the Prospectus
contained in the Exchange Offer Registration Statement is not appropriate or
available for such resales by such Holder, or (C) such Holder is a
Broker-Dealer and holds Initial Notes acquired directly from the Company or one
of its Affiliates, then the Company and the Guarantors shall:


 


(i)                                     use
their respective reasonable best efforts to file a shelf registration statement
pursuant to Rule 415 under the Securities Act, which may be an amendment to the
Exchange Offer Registration Statement (in either event, the “Shelf Registration Statement”),
on or prior to the earlier to occur of (1) the 30th day (or if the 30th
day is not a Business Day, the first Business Day thereafter) after the date on
which the Company receives notice from the Commission or determines that it is
not required to file the Exchange Offer Registration Statement pursuant to
clause (i) above, and (2) the 30th day (or if the 30th day is not a
Business Day, the first Business Day thereafter) after the date on which the
Company receives notice from a Holder of Transfer Restricted Securities as
contemplated by clause (ii) above (such earlier date being the “Shelf Filing Deadline”),
which Shelf Registration Statement shall provide for resales of all Transfer
Restricted Securities the Holders of which shall have provided the information
required pursuant to Section 4(b) hereof; and


 


(ii)                                  use
their respective reasonable best efforts to cause such Shelf Registration
Statement to become effective under the Securities Act on or before the 90th
day (or if the 90th day is not a Business Day, the first Business
Day thereafter) after the Shelf Filing Deadline.


 


The Company and the Guarantors shall use their respective reasonable best
efforts to keep such Shelf Registration Statement continuously effective,
supplemented and amended as required by and subject to the provisions of
Sections 6(b) and (c) hereof to the extent necessary to ensure that it is
available for sales of Transfer Restricted Securities by the Holders thereof
entitled to the benefit of this Section 4(a), and to ensure that it conforms
with the requirements of this Agreement, the Securities Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of at least two years (as extended pursuant to Section 6(c)(i))
following the date on which such Shelf Registration Statement first is declared
or becomes effective under the Securities Act or such shorter period ending on
the earlier of when all of the Transfer Restricted Securities available for
sale thereunder (i) have been sold pursuant thereto and (ii) are not longer
restricted securities (as defined in Rule 144 under the Securities Act, or any
successor rule thereof).


 


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(b)                                 Provision by Holders of Certain Information in
Connection with the Shelf Registration Statement. No Holder of
Transfer Restricted Securities may include any of its Transfer Restricted
Securities in any Shelf Registration Statement pursuant to this Agreement
unless and until such Holder furnishes to the Company and the Guarantors in
writing, within 10 Business Days after receipt of a request therefor, such
information as the Company may reasonably request for use in connection with
any Shelf Registration Statement or Prospectus or preliminary Prospectus
included therein. No Holder of Transfer Restricted Securities shall be entitled
to Additional Interest (as defined below) pursuant to Section 5 hereof unless
and until such Holder shall have provided all such reasonably requested
information. Each Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to the Company all information required to
be disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading.


 


5.                                  Additional
Interest.  If (i) any of the
Registration Statements required by this Agreement is not filed with the
Commission on or prior to the date specified for such filing in this Agreement,
(ii) any of such Registration Statements has not become effective under the
Securities Act on or prior to the date specified for such effectiveness in this
Agreement (the “Effectiveness
Target Date”), (iii) the Exchange Offer has not been Consummated
within 60 days after the Effectiveness Target Date with respect to the Exchange
Offer Registration Statement or (iv) any Registration Statement required by
this Agreement is filed and becomes effective under the Securities Act but
shall thereafter cease to be effective or fail to be usable for its intended
purpose without being succeeded within 30 days by a post-effective amendment to
such Registration Statement, the effectiveness of another Registration
Statement or the use of the Prospectus (as amended or supplemented) is again
permitted that cures such failure (each such event referred to in clauses (i)
through (iv), a “Registration
Default”), the Company hereby agrees to pay, as liquidated
damages for such Registration Default, subject to the provisions of Section
12(a), additional interest (“Additional Interest”). Additional Interest shall be paid
to each Holder of Transfer Restricted Securities with respect to the first
90-day period immediately following the occurrence of such Registration
Default, in an amount equal to $0.05 per week per $1,000 principal amount of
Transfer Restricted Securities held by such Holder for each week or portion
thereof that the Registration Default continues. The amount of the Additional
Interest shall increase by an additional $0.05 per week per $1,000 in 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 Additional Interest of $0.50 per week per $1,000 principal amount of
Transfer Restricted Securities. All accrued Additional Interest shall be paid
to each Holder of Transfer Restricted Securities by the Company at the same
times and in the same manner as other interest on the Notes. Notwithstanding
anything to the contrary set forth herein, (1) upon filing of the Exchange
Offer Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of (i) above, (2) upon the effectiveness of the Exchange
Offer Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of (ii) above, (3) upon Consummation of the Exchange
Offer, in the case of (iii) above, or (4) upon the filing of a post-effective
amendment to the Registration Statement or an additional Registration Statement
that causes the Exchange Offer Registration Statement (and/or, if applicable,
the Shelf Registration Statement) to again be declared effective or the
Prospectus to be made usable in the case of (iv) above, the Additional Interest
payable with respect to the Transfer Restricted Securities as a result of such
clause (i), (ii), (iii) or (iv), as applicable, shall cease.


 


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All obligations of the Company and the Guarantors 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 with
respect to such security shall have been satisfied in full.


 


6.                                  Registration
Procedures.


 


(a)                                  Exchange Offer Registration Statement. In
connection with the Exchange Offer, the Company and the Guarantors shall comply
with all applicable provisions of Section 6(c) below, shall use their
respective reasonable best efforts to effect such exchange to permit the sale
of Broker-Dealer Transfer Restricted Securities being sold in accordance with
the intended method or methods of distribution thereof (which shall be in a
manner consistent with the terms of this Agreement), and shall comply with all
of the following provisions:


 


(i)                                     If,
following the date hereof and prior to the Consummation of the Exchange Offer,
there has been published a change in Commission policy with respect to exchange
offers such as the Exchange Offer, such that in the reasonable opinion of
counsel to the Company there is a substantial question as to whether the
Exchange Offer is permitted by applicable law or Commission policy, the Company
and the Guarantors hereby agree to seek a no-action letter or other favorable
decision from the Commission allowing the Company and the Guarantors to
Consummate an Exchange Offer for such Initial Notes. The Company and the
Guarantors hereby agree to pursue the issuance of such a decision to the
Commission staff level but shall not be required to take commercially
unreasonable action to effect a change of Commission policy. The Company and
the Guarantors hereby agree, however, to take all such other actions as are
reasonably requested by the Commission staff or otherwise required in
connection with the issuance of such decision, including without limitation, to
(A) participate in telephonic conferences with the Commission staff, (B)
deliver to the Commission staff an analysis prepared by counsel to the Company
setting forth the legal bases, if any, upon which such counsel has concluded
that such an Exchange Offer should be permitted and (C) diligently pursue a
resolution (which need not be favorable) by the Commission staff of such
submission.


 


(ii)                                  As
a condition to its participation in the Exchange Offer pursuant to the terms of
this Agreement, each Holder of Transfer Restricted Securities shall furnish,
upon the request of the Company, prior to the Consummation thereof, a written
representation to the Company (which may be contained in the letter of
transmittal contemplated by the Exchange Offer Registration Statement) to the
effect that (A) it is not an Affiliate of the Company, (B) it is not engaged
in, and does not intend to engage in, and has no arrangement or understanding
with any Person to participate in, a distribution of the Exchange Notes to be
issued in the Exchange Offer and (C) it is acquiring the Exchange Notes in its
ordinary course of business. In addition, all such Holders of Transfer
Restricted Securities shall otherwise reasonably cooperate in the Company’s
preparations for the Exchange Offer. Each Holder hereby acknowledges and agrees
that any Broker-Dealer and any such Holder using the Exchange Offer to
participate in a distribution of the securities to be acquired in the Exchange
Offer (1) could not under Commission policy as in effect on the date of this
Agreement rely on the position of the Commission


 


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enunciated in no-action letters issued to Morgan Stanley and Co.
Incorporated (available June 5, 1991) and Exxon Capital Holdings
Corporation  (available May 13, 1988), as
interpreted in the Commission’s letter to Shearman & Sterling dated July 2,
1993, and similar no-action letters 
(including any no-action letter obtained pursuant to clause (i) above),
and (2) must comply with the registration and prospectus delivery requirements
of the Securities Act in connection with a secondary resale transaction and
that such a secondary resale transaction should be covered by an effective
registration statement containing the selling security holder information
required by Item 507 or 508, as applicable, of Regulation S-K if the resales
are of the Exchange Notes obtained by such Holder in exchange for Initial Notes
acquired by such Holder directly from the Company or an Affiliate thereof.


 


(iii)                               Prior
to effectiveness of the Exchange Offer Registration Statement, the Company and
the Guarantors shall provide a supplemental letter to the Commission (A)
stating that the Company and the Guarantors are registering the Exchange Offer
in reliance on the position of the Commission enunciated in no-action letters
issued to Exxon Capital Holdings Corporation (available May 13, 1988), Morgan
Stanley and Co. Incorporated (available June 5, 1991) and, if applicable, any
no-action letter obtained pursuant to clause (i) above, (B) including a
representation that neither the Company nor any Guarantor has entered into any
arrangement or understanding with any Person to distribute the Exchange Notes
to be received in the Exchange Offer and that, to the best of the Company’s
information and belief, each Holder participating in the Exchange Offer is
acquiring the Exchange Notes in its ordinary course of business and has no
arrangement or understanding with any Person to participate in the distribution
of the Exchange Notes received in the Exchange Offer and (C) any other
undertaking or representation required by the Commission as set forth in any
no-action letter obtained pursuant to clause (i) above.


 


(b)                                 Shelf Registration Statement. In
connection with the Shelf Registration Statement, the Company and the
Guarantors shall comply with all the provisions of Section 6(c) below and shall
use their reasonable best efforts to effect such registration to permit the
sale of the Transfer Restricted Securities being sold in accordance with the
intended method or methods of distribution thereof, and pursuant thereto the
Company and the Guarantors will as expeditiously as possible, and in any event
within the time periods and otherwise in accordance with the provisions hereof,
prepare and file with the Commission a Registration Statement relating to the
registration on any appropriate form under the Securities Act, which form shall
be available for the sale of the Transfer Restricted Securities in accordance
with the intended method or methods of distribution thereof.


 


(c)                                  General Provisions. In connection with any
Registration Statement and any Prospectus required by this Agreement to permit
the sale or resale of Transfer Restricted Securities (including, without
limitation, any Exchange Offer Registration Statement and the related
Prospectus required to permit resales of Transfer Restricted Securities by
Restricted Broker-Dealers), the Company and the Guarantors shall:


 


(i)                                     use
their respective reasonable best efforts to keep such Registration Statement
continuously effective and provide all requisite financial statements for the


 


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period specified in Section 3 or 4 of this Agreement, as applicable;
upon the occurrence of any event that would cause any such Registration
Statement or the Prospectus contained therein (A) to contain a material misstatement
or omission or (B) not to be effective and usable for resale of Transfer
Restricted Securities during the period required by this Agreement, the Company
and the Guarantors shall file promptly an appropriate amendment to such
Registration Statement, (1) in the case of clause (A), correcting any such
misstatement or omission, and (2) in the case of either clause (A) or (B), use
their respective reasonable best efforts to cause such amendment to be declared
effective and such Registration Statement and the related Prospectus to become
usable for their intended purpose(s) as soon as practicable thereafter;


 


(ii)                                  use
their respective reasonable best efforts: (A) to prepare and file with the
Commission such amendments and post-effective amendments to the Registration
Statement as may be necessary to keep the Registration Statement effective for
the applicable period set forth in Section 3 or 4 hereof; (B) to 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, and to
comply fully with the applicable provisions of Rules 424, 430A and 462 under
the Securities Act in a timely manner; and (C) to comply with the provisions of
the Securities Act with respect to the disposition of all 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;


 


(iii)                               advise
the underwriter(s), if any, and selling Holders promptly and, if requested by
such Persons, to confirm such advice in writing, (A) when the Prospectus or any
Prospectus supplement or post-effective amendment thereto has been filed, and,
with respect to any Registration Statement or any post-effective amendment
thereto, when the same has become effective, (B) of any request by the
Commission for amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information relating thereto,
(C) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement under the Securities Act or of the
suspension by any state securities commission of the qualification of the
Transfer Restricted Securities for offering or sale in any jurisdiction, or the
initiation of any proceeding for any of the preceding purposes, (D) of the
existence of any fact or the happening of any event that makes any statement of
a material fact made in the Registration Statement, the Prospectus, any
amendment or supplement thereto, or any document incorporated by reference
therein untrue in any material respect, or that requires the making of any
additions to or changes in the Registration Statement or the Prospectus in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading; and 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
Company shall use its reasonable best efforts to obtain the withdrawal or
lifting of such order at the earliest practicable time;


 


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(iv)                              upon
written request, furnish to the Purchasers, and, upon written request, to each
of the selling Holders and each of the underwriter(s) in connection with such
sale, if any, before filing with the Commission, copies of any Registration
Statement or any Prospectus included therein or any amendments or supplements
to any such Registration Statement or Prospectus, which documents will be
subject to the review of such Holders and underwriter(s) in connection with
such sale, if any, for a period of at least five Business Days, and the Company
will not file any such Registration Statement or Prospectus or any amendment or
supplement to any such Registration Statement or Prospectus to which a selling
Holder of Transfer Restricted Securities covered by such Registration Statement
or the underwriter(s) in connection with such sale, if any, shall reasonably
object within five Business Days after the receipt thereof; and a selling
Holder or underwriter in connection with such sale, if any, shall be deemed to
have reasonably objected to such filing (A) if such Registration Statement,
amendment, Prospectus or supplement, as applicable, as proposed to be filed,
contains a material misstatement or omission or fails to comply with the
applicable requirements of the Securities Act or (B) if any of the information
furnished to the Company by such selling Holder or underwriter in connection
with such sale, if any, and included in such Registration statement, amendment,
Prospectus or supplement, as applicable, as proposed to be filed is incorrect
in any respect;


 


(v)                                 [intentionally
omitted];


 


(vi)                              in
the case of a shelf registration, make available at reasonable times for
inspection by the selling Holders, any underwriter participating in any
disposition pursuant to such Registration Statement, and any attorney or
accountant retained by such selling Holders or any of the underwriter(s), all
relevant financial and other records, pertinent corporate documents and
properties of the Company and cause the Company’s officers, directors and
employees to supply all information, in each case,  reasonably requested by any such Holder,
underwriter, attorney or accountant in connection with such Registration
Statement or any post-effective amendment thereto subsequent to the filing
thereof and prior to its effectiveness;


 


(vii)                           in
the case of a shelf registration, if requested by any selling Holders or the
underwriter(s) in connection with such sale, if any, promptly incorporate in
any Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as such selling Holders
and underwriter(s), if any, may reasonably request to have included therein,
including, without limitation, information relating to the “Plan of
Distribution” of the Transfer Restricted Securities, information with respect
to the principal amount of Transfer Restricted Securities being sold to such
underwriter(s), the purchase price being paid therefor and any other terms of
the offering of the Transfer Restricted Securities to be sold in such offering;
and make all required filings of such Prospectus supplement or post-effective
amendment as soon as practicable after the Company is notified of the matters
to be incorporated in such Prospectus supplement or post-effective amendment;


 


(viii)                        in
the case of a shelf registration, use their respective commercially reasonable
efforts to cause the Transfer Restricted Securities covered by the Registration


 


11

















 


Statement to be rated with the appropriate rating agencies, if so
requested by the Holders of a majority in aggregate principal amount of Notes
covered thereby or the underwriter(s) in connection with such sale, if any,
unless such Transfer Restricted Securities are already so rated;


 


(ix)                                in
the case of a shelf registration, furnish to each selling Holder and each of
the underwriter(s) in connection with such sale, if any, without charge, at
least one copy of the Registration Statement, as first filed with the
Commission, and of each amendment thereto, including all documents incorporated
by reference therein and all exhibits (including exhibits incorporated therein
by reference);


 


(x)                                   deliver
to each selling Holder and each of the underwriter(s), if any, without charge,
as many copies of the Prospectus (including each preliminary Prospectus) and
any amendment or supplement thereto as such Persons reasonably may request; the
Company and the Guarantors hereby consent to the use of the Prospectus and any
amendment or supplement thereto by each of the selling Holders and each of the
underwriter(s), if any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;


 


(xi)                                in
the case of a shelf registration, enter into such agreements (including an
underwriting agreement), and make such representations and warranties with
respect to the business of the Company as are customarily addressed in
representations and warranties made by issuers to underwriters in Underwritten
Offerings, and take all such other commercially reasonable actions in
connection therewith in order to expedite or facilitate the disposition of the
Transfer Restricted Securities pursuant to any Shelf Registration Statement
contemplated by this Agreement, all to such extent as may be requested by the
Purchasers or by any Holder of Transfer Restricted Securities or underwriter in
connection with any sale or resale pursuant to any Shelf Registration Statement
contemplated by this Agreement; and whether or not an underwriting agreement is
entered into and whether or not the registration is an Underwritten
Registration, the Company and the Guarantors shall:


 


(A)                              furnish to the
Purchasers, each selling Holder and each underwriter, if any, in such substance
and scope as they may reasonably request and as are customarily made by issuers
to underwriters in primary Underwritten Offerings, upon the effectiveness of
the Shelf Registration Statement:


 


(1)                                  a certificate, dated
the date of effectiveness of the Shelf Registration Statement signed on behalf
of the Company and each of the Guarantors by the Chairman of the Board,
President or any Vice President and Treasurer or Chief Financial Officer of the
Company, confirming, as of the date thereof, the matters set forth in Section
7(h) of the Purchase Agreement and such other matters as such parties may
reasonably request;


 


(2)                                  opinions, dated the
date of effectiveness of the Shelf Registration Statement, of counsel or
counsels for the Company and the Guarantors, covering such


 


12

















 


matters as are customarily covered in opinions given in connection with
underwritten firm commitment offerings;


 


(3)                                  customary comfort
letters, dated as of the date of effectiveness of the Shelf Registration
Statement, from the Company’s independent accountants, in the customary form
and covering matters of the type customarily covered in comfort letters by
underwriters in connection with Underwritten Offerings, and affirming the
matters set forth in the comfort letters delivered pursuant to Section 7(e) and
Section 7(f) of the Purchase Agreement, without exception;


 


(B)                                set forth in full or
incorporate by reference in the underwriting agreement, if any, the
indemnification provisions and procedures of Section 8 hereof with respect to
all parties to be indemnified pursuant to said Section; and


 


(C)                                deliver such other
documents and certificates as may be reasonably requested by such parties to
evidence compliance with clause (A) above and with any customary conditions
contained in the underwriting agreement or other agreement entered into by the
Company and the Guarantors pursuant to this clause (xi), if any, it being
understood that the above shall be done at each closing under such underwriting
or similar agreement, as and to the extent required thereunder, and, if at any
time the representations and warranties of the Company and the Guarantors
contemplated in clause (A)(1) above cease to be true and correct in any
material respect, the Company and the Guarantors shall so advise the Purchasers
and the underwriter(s), if any, each selling Holder and each Restricted
Broker-Dealer promptly and, if requested by such Persons, shall confirm such
advice in writing;


 


(xii)                             prior
to any public offering of Transfer Restricted Securities, cooperate with the
selling Holders, the underwriter(s), if any, and its counsel in connection with
the registration and qualification of the Transfer Restricted Securities under
the securities or Blue Sky laws of such jurisdictions as the selling Holders or
underwriter(s), if any, may request and do any and all other acts or things
necessary or advisable to enable the disposition in such jurisdictions of the
Transfer Restricted Securities covered by the applicable Registration
Statement; provided, however, that neither the Company nor any Guarantor shall
be required to register or qualify as a foreign corporation where it is not now
so qualified or to take any action that would subject it to the service of
process in suits or to taxation, other than as to matters and transactions relating
to the Registration Statement, in any jurisdiction where it is not now so
subject;


 


(xiii)                          issue,
upon the request of any Holder of Initial Notes covered by any Shelf
Registration Statement contemplated by this Agreement, Exchange Notes, having
an aggregate principal amount equal to the aggregate principal amount of the
Initial Notes surrendered to the Company by such Holder in exchange therefor or
being sold by such Holder; such Exchange Notes to be registered in the name of
such Holder or in the name of the purchaser(s) of such Notes, as the case may
be; in return, the Initial Notes held by such Holder shall be surrendered to
the Company for cancellation;


 


13

















 


(xiv)                         in
the case of a shelf registration, cooperate with the selling Holders and the
underwriter(s), if any, to facilitate the timely preparation and delivery of
certificates representing Transfer Restricted Securities to be sold and not
bearing any restrictive legends; and enable such Transfer Restricted Securities
to be in such denominations and registered in such names as the Holders or the
underwriter(s), if any, may request at least two Business Days prior to any
sale of Transfer Restricted Securities made by such underwriter(s);


 


(xv)                            use
their respective commercially reasonable efforts to cause the disposition of
the Transfer Restricted Securities covered by the 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
underwriter(s), if any, to consummate the disposition of such Transfer
Restricted Securities, subject to the proviso contained in clause (xii) above;


 


(xvi)                         subject
to Section 6(c)(i), if any fact or event contemplated by clause 6(c)(iii)(D)
above shall exist or have occurred, prepare a supplement or post-effective
amendment to the Registration Statement or related Prospectus or any document
incorporated therein by reference or file any other required document so that,
as thereafter delivered to the purchasers of Transfer Restricted 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 in the
light of the circumstances under which they were made not misleading;


 


(xvii)                      provide
a CUSIP number for all Transfer Restricted Securities not later than the
effective date of the Registration Statement covering such Transfer Restricted
Securities and provide the Trustee with one or more certificates for the
Transfer Restricted Securities which are in a form eligible for deposit with
The Depository Trust Company;


 


(xviii)                   in
the case of a shelf registration, cooperate and assist in any filings required
to be made with the FINRA 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 FINRA), and use their respective reasonable best efforts to
cause such Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to enable the Holders
selling Transfer Restricted Securities to consummate the disposition of such
Transfer Restricted Securities;


 


(xix)                           otherwise
use their respective commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make generally
available to the Company’s security holders, as soon as practicable, a consolidated
earnings statement meeting the requirements of Rule 158 (which need not be
audited) for the twelve-month period (A) commencing at the end of any fiscal
quarter in which Transfer Restricted Securities are sold to underwriters in a
firm or best efforts Underwritten Offering or (B) if not sold to underwriters
in such an offering, beginning


 


14

















 


with the first month of the Company’s first fiscal quarter commencing
after the effective date of the Registration Statement;


 


(xx)                             qualify the Indenture
under the TIA (at or before the Effective Time of the Exchange Offer or the
Shelf Registration, as the case may be);


 


(xxi)                          in the case of a shelf
registration, cause all Transfer Restricted Securities covered by the
Registration Statement to be listed on each securities exchange on which
similar securities issued by the Company are then listed if requested by the
Holders of a majority in aggregate principal amount of the Initial Notes or the
managing underwriter(s), if any; and


 


(xxii)                       provide promptly to each Holder
upon request each document filed with the Commission pursuant to the
requirements of Section 13 and Section 15(d) of the Exchange Act.


 


(d)                                 Restrictions on Holders. (i) Each
Holder agrees by acquisition of a Transfer Restricted Security that, upon
receipt of any notice from the Company of the existence of any fact of the kind
described in Section 6(c)(iii)(D) hereof, such Holder will forthwith
discontinue disposition of Transfer Restricted Securities pursuant to the
applicable Registration Statement until such Holder’s receipt of the copies of
the supplemented or amended Prospectus contemplated by Section 6(c)(xvi)
hereof, or until it is advised in writing (the “Advice”) by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus. If
so directed by the Company, each Holder will deliver to the Company (at the
Company’s expense) all copies, other than permanent file copies then in such
Holder’s possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice. In the event
the Company shall give any such notice, the time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or 4
hereof, as applicable, 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 6(c)(iii)(D) hereof to and including the date when each selling Holder
covered by such Registration Statement shall have received the copies of the
supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof or
shall have received the Advice.


 


7.                                      Registration
Expenses.  All expenses incident
to the Company’s and the Guarantors’ performance of or compliance with this
Agreement will be borne by the Company, regardless of whether a Registration
Statement becomes effective, including, without limitation:  (i) all registration and filing fees and
expenses (including filings made by the Purchasers or any Holder with the FINRA
(and, if applicable, the fees and expenses of any “qualified independent
underwriter”) that may be required by the rules and regulations of the FINRA);
(ii) all fees and expenses of compliance with federal securities and state Blue
Sky or securities laws; (iii) all expenses of printing (including printing of
Prospectuses); (iv) all fees and disbursements of counsel for the Company; (v)
all messenger and delivery services and telephone expenses of the Company and
the Guarantors; and (vi) all fees and disbursements of independent certified
public accountants of the Company (including the expenses of any special audit
and comfort letters required by or incident to such performance).


 


15

















 


The Company and the Guarantors will, in any event, bear their internal
expenses (including, without limitation, all salaries and expenses of any of
their officers and employees performing legal or accounting duties), the
expenses of any annual audit and the fees and expenses of any Person, including
special experts, retained by the Company or the Guarantors.


 


8.                                      Indemnification.


 


(a)                                                          The
Company and each Guarantor, jointly and severally, shall indemnify and hold
harmless each Holder, its directors, officers and each person, if any, who
controls such Holder within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities, judgments and actions, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim, damage,
liability, judgment or action relating to purchases and sales of Notes), to
which that Holder, its directors, officers or controlling persons may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability, judgment or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained in
any Registration Statement, preliminary Prospectus, Prospectus, Free Writing
Prospectus or any “issuer information” (as defined in Rule 433 of the
Securities Act) filed or required to be filed pursuant to Rule 433(d) under the
Securities Act or any amendment or supplement thereto or (ii) the omission or
alleged omission to state in any Registration Statement, preliminary Prospectus
or Prospectus, or in any amendment or supplement thereto, any material fact
required to be stated therein or necessary to make the statements therein not
misleading, and shall reimburse such Holder and each such director, officer or
controlling person promptly upon demand for any legal or other out-of-pocket
expenses reasonably incurred by such Holder, director, officer or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability, judgment or action as such
expenses are incurred; provided, however, that the Company and the Guarantors
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability, judgment or action arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in any Registration Statement, preliminary Prospectus or Prospectus, or in
any such amendment or supplement thereto, in reliance upon and in conformity
with written information concerning such Holder furnished to the Company by or
on behalf of such Holder specifically for inclusion therein. The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any Holder or to any director, officer or controlling person
of such Holder.


 


(b)                                                         Each
Holder, severally and not jointly, shall indemnify and hold harmless the
Company, the Guarantors and their respective directors, officers and each
person, if any, who controls the Company or any Guarantor within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities, judgments or actions,
joint or several, or any action in respect thereof, to which the Company, any
Guarantor or any such director, officer or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability, judgment or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained in
any Registration Statement, preliminary Prospectus or Prospectus or in any
amendment or supplement thereto or (ii) the omission or alleged omission to
state in any Registration Statement, preliminary Prospectus or Prospectus, or
in any amendment or


 


16

















 


supplement thereto, any material fact
required to be stated therein or necessary to make the statements therein not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information concerning such Holder
furnished to the Company by or on behalf of such Holder specifically for
inclusion therein, and shall reimburse the Company, the Guarantors and any such
director, officer or controlling person promptly upon demand for any legal or
other out-of-pocket expenses reasonably incurred by the Company, any Guarantor
or any such director, officer or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability, judgment or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which any Holder
may otherwise have to the Company, any Guarantor or any such director, officer
or controlling person.


 


(c)                                                          Promptly
after receipt by any person in respect of which indemnity may be sought
pursuant to Section 8(a) or 8(b) (the “indemnified party”) of notice of any claim or
the commencement of any action, the indemnified party shall, if a claim in
respect thereof is to be made against any person against whom indemnity may be
sought pursuant to Section 8(a) or 8(b) (the “indemnifying party”), notify the
indemnifying party in writing of the claim or the commencement of that action;
provided, however, that the failure to notify the indemnifying party shall not
relieve it from any liability which it may have under this Section 8 except to
the extent it has been materially prejudiced by such failure and, provided
further, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have to an indemnified party otherwise than
under this Section 8. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party,
to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party and the payment of all fees and out-of-pocket expenses of
such counsel shall be the responsibility of the indemnifying party. After
notice from the indemnifying party to the indemnified party of the indemnifying
party’s election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Section 8 for any legal or other out-of-pocket expenses subsequently incurred
by the indemnified party in connection with the defense thereof other than
reasonable costs of investigation. In addition, any indemnified party shall
have the right to employ separate counsel in any such action and participate in
the defense thereof, but  the fees and
out-of-pocket expenses of such counsel shall be at the expense of the
indemnified party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
the indemnified party and the indemnifying party, and the indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and out-of-pocket expenses of more than
one separate firm of attorneys (in addition to any local counsel) of all
indemnified parties, and all such fees and expenses shall be


 


17

















 


reimbursed as they are incurred. Such firm
shall be designated in writing by the Purchasers in the case of the parties
indemnified pursuant to Section 8(a), and by the Company in the case of parties
indemnified pursuant to Section 8(b). No indemnifying party shall (i) without
the prior written consent of the indemnified parties (which consent shall not
be unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding, or (ii) be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the consent of
the indemnifying party or if there be a final judgment of the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by reason of such
settlement or judgment.


 


(d)                                                         If
the indemnification provided for in this Section 8 shall for any reason be
unavailable or insufficient to hold harmless an indemnified party under Section
8(a) or 8(b) in respect of any loss, claim, damage, liability, judgment or any
action in respect thereof, referred to therein, then each indemnifying party
shall, in lieu of indemnifying such indemnified party, contribute to the amount
paid or payable by such indemnified party as a result of such loss, claim,
damage, liability, judgment or action in respect thereof, (i) in such
proportion as shall be appropriate to reflect the relative benefits received by
the Company and the Guarantors, on the one hand, and the Holders, on the other,
from the offering of the Notes or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company and the Guarantors, on the one hand, and
the Holders, on the other, with respect to the statements or omissions which
resulted in such loss, claim, damage, liability, judgment or action in respect
thereof, as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Guarantors, on the one hand, and the
Holders, on the other, with respect to such offering shall be deemed to be in
the same proportion as the total net proceeds from the offering of the Initial
Notes purchased under the Purchase Agreement (before deducting expenses)
received by the Company on the one hand, and the total net proceeds received by
such Holder upon its resale of Notes less the amount paid by such Holder for such
Notes, on the other hand, bear to the total sum of such amounts. The relative
fault shall be determined by reference to whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company and the Guarantors
or such Holder, the intent of the parties and their relative knowledge, access
to information and opportunity to correct or prevent such statement or omission.
Solely for the purposes of the preceding two sentences, the net proceeds
received by the Company shall be deemed also to be indirectly for the benefit
of the Guarantors and the information supplied by the Company shall also be
deemed to have been supplied by the Guarantors. The Company and the Guarantors
and the Holders agree that it would not be just and equitable if contributions
pursuant to this Section 8 were to be determined by pro rata allocation (even
if the Holders were treated as one entity for such purpose) or by any other
method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage, liability, judgment or action in
respect thereof, referred to above in this Section 8, shall


 


18

















 


be deemed to include, for purposes of this
Section 8(d), any legal or other out-of-pocket expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8(d), no
Holder, and none of its directors, officers or controlling persons, shall be
required to contribute, in the aggregate, any amount in excess of the amount by
which the total net proceeds received by such Holder upon its resale of Notes
exceeds the sum of the amount paid by such Holder for such Notes and the amount
of any damages which such Holder has otherwise paid or become liable to pay by
reason of any untrue or alleged untrue statement or omission or alleged
omission. 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. The Holders’
obligations to contribute as provided in this Section 8(d) are several in
proportion to the respective principal amount of Notes held by each of the
Holders hereunder and not joint.


 


(e)                                                          The
remedies provided for in this Section 8 are not exclusive and shall not limit
any rights or remedies which may otherwise be available to any indemnified
party at law or in equity.


 


9.                                      Rule
144A.  The Company and the
Guarantors hereby agree with each Holder, for so long as any Transfer Restricted
Securities remain outstanding and during any period in which the Company is not
subject to Section 13 or 15(d) of the Exchange Act, to make available to any
Holder or beneficial owner of Transfer Restricted Securities in connection with
any sale thereof and any prospective purchaser of such Transfer Restricted
Securities from such Holder or beneficial owner, the information required by
Rule 144A(d)(4) under the Securities Act in order to permit resales of such
Transfer Restricted Securities pursuant to Rule 144A.


 


10.                               Participation
in Underwritten Registration.  No
Holder may participate in any Underwritten Registration hereunder unless such
Holder (a) agrees to sell such Holder’s Transfer Restricted Securities on the
basis provided in any underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements and (b) completes and executes
all reasonable questionnaires, powers of attorney, indemnities, underwriting
agreements, lock-up letters and other documents required under the terms of
such underwriting arrangements.


 


11.                               Selection
of Underwriters.  For any
Underwritten Offering, the investment banker or investment bankers and manager
or managers that will administer such offering will be selected by the Holders
of a majority in aggregate principal amount of the Transfer Restricted
Securities included in such offering; provided, that such investment bankers
and managers must be reasonably satisfactory to the Company. Such investment
bankers and managers are referred to herein as the “underwriters.”


 


12.                               Miscellaneous.


 


(a)                                  Remedies.
Each Holder, in addition to being entitled to exercise all rights provided
herein, in the Indenture, the Purchase Agreement or granted by law, including
recovery of liquidated or other damages, will be entitled to specific
performance of its rights under this Agreement. The Company and the Guarantors
agree that monetary damages (including the Additional Interest contemplated
hereby) would not be adequate compensation for any loss


 


19

















 


incurred by reason of a breach by them of the
provisions of this Agreement and hereby agree to waive the defense in any
action for specific performance that a remedy at law would be adequate.


 


(b)                                 Free Writing Prospectus. The Company
represents, warrants and covenants that it (including its agents and
representatives) will not prepare, make, use, authorize, approve or refer to
any “written communication” (as defined in Rule 405 under the Securities Act)
in connection with the issuance and sale of the Notes and the Exchange Notes,
other than any communication pursuant to Rule 134, Rule 135 or Rule 135c under
the Securities Act, any document constituting an offer to sell or solicitation
of an offer to buy the Notes or the Exchange Notes that falls within the
exception from the definition of prospectus in Section 2(a)(10)(a) of the
Securities Act or a prospectus satisfying the requirements of Section 10(a) of
the Securities Act or of Rule 430, Rule 430A, Rule 430B, Rule 430C or Rule 431
under the Securities Act.


 


(c)                                  No Inconsistent Agreements. Neither the
Company nor any Guarantor will on or after the date of this Agreement enter
into any agreement with respect to its securities that is inconsistent with the
rights granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof. Neither the Company nor any Guarantor is currently bound by
any agreement granting registration rights with respect to its securities that
conflicts with the registration rights set forth herein.


 


(d)                                 Adjustments Affecting the Initial Notes. Neither
the Company nor any Guarantor will take any action, or permit any change to
occur, with respect to the Initial Notes that would materially and adversely
affect the ability of the Holders to Consummate any Exchange Offer.


 


(e)                                  Amendments and Waivers. The provisions of
this Agreement may not be amended, modified or supplemented, and waivers or
consents to or departures from the provisions hereof may not be given unless
(i) in the case of Section 5 hereof and this Section 12(e), the Company has
obtained the written consent of the Holders of all outstanding principal amount
of Transfer Restricted Securities and (ii) in the case of all other provisions
hereof, the Company has obtained the written consent of Holders of a majority
of the outstanding principal amount of Transfer Restricted Securities. Notwithstanding
the foregoing, a waiver or consent to departure from the provisions hereof that
relates exclusively to the rights of Holders whose securities are being
tendered pursuant to the Exchange Offer and that does not affect directly or
indirectly the rights of other Holders whose securities are not being tendered
pursuant to such Exchange Offer may be given by the Holders of a majority of the
outstanding principal amount of Transfer Restricted Securities being tendered
or registered.


 


(f)                                    Notices. All notices and other
communications provided for or permitted hereunder shall be made in writing by
hand-delivery, first-class mail (registered or certified, return receipt
requested), fax, or air courier guaranteeing overnight delivery:


 


(i)                                     if
to a Holder, at the address set forth on the records of the registrar under the
Indenture or to such other address as it may have provided to the Company in accordance
with this Section 12 and


 


20

















 


With copies to:


 


Lehman Brothers Inc.

Banc of America Securities LLC


Morgan Stanley & Co. Incorporated


c/o Lehman Brothers Inc.


745 Seventh Avenue


New York, New York 10019


Attention:  Syndicate Department


Fax:  212-526-0943


 


and


 


Vinson & Elkins L.L.P.


Attention: D. Alan Beck, Jr.


1001 Fannin, Suite 2500


Houston, Texas  77002-6760


Fax:  713-615-5620


 


(ii)                                  if
to the Purchasers, to the address specified in Section 12(a) of the Purchase
Agreement.


 


(iii)                               if
to the Company or any Guarantor:


 


Key Energy Services, Inc. 

1301 McKinney, Suite 1800


Houston, Texas  77010


Attention: Chief Financial Officer

Fax: 713-652-4005


 


With a copy to:


 


Porter & Hedges, L.L.P.

1001 Main Street, 36th Floor


Houston, Texas 77002


Attention: William W. Wiggins


Fax: 713-226-6227


 


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 receipt acknowledged, if faxed; and on the
next Business Day, if timely delivered to an air courier guaranteeing overnight
delivery.


 


Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.


 


21

















 


(g)                                 Successors and Assigns. This Agreement
shall inure to the benefit of and be binding upon the successors and assigns of
each of the parties, including without limitation and without the need for an
express assignment, subsequent Holders of Transfer Restricted Securities;
provided, however, that nothing herein shall be deemed to permit any assignment,
transfer or other disposition of Transfer Restricted Securities in violation of
the terms hereof or of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Transfer Restricted Securities in any
manner, whether by operation of law or otherwise, such Transfer Restricted
Securities shall be held subject to all of the terms of this Agreement, and by
owning and holding such Transfer Restricted Securities such person shall be
conclusively deemed to have agreed to be bound by and to perform all of the
terms and provisions of this Agreement, including the restrictions on resale
set forth in this Agreement and, if applicable, the Purchase Agreement, and
such Person shall be entitled to receive the benefits hereof.


 


(h)                                 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.


 


(i)                                     Headings. The headings in this Agreement
are for convenience of reference only and shall not limit or otherwise affect
the meaning hereof.


 


(j)                                   Governing
Law. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.


 


(k)                               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 by a court of competent jurisdiction, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.


 


(l)                                     Entire Agreement. This Agreement and the
other writings referred to herein (including the Purchase Agreement, the
Indenture and the form of Notes) are intended by the parties as a final
expression of their agreement 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 Company with respect to
the Transfer Restricted Securities. This Agreement and the other writings
referred to herein (including the Purchase Agreement, the Indenture and the
form of Notes) supersede all prior agreements and understandings between the
parties with respect to such subject matter.


 


22

















 


IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first written above.


 


	
   

  	
  KEY ENERGY SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Richard J. Alario

  
	
   

  	
   

  	
  Richard J. Alario

  
	
   

  	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Newton W. Wilson

  
	
   

  	
   

  	
  Newton W. Wilson III

  
	
   

  	
   

  	
  Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  KEY ENERGY SERVICES MEXICO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Newton W. Wilson

  
	
   

  	
   

  	
  Newton W. Wilson III

  
	
   

  	
   

  	
  Vice President and Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PETROLEUM WELL SERVICES, INC.

  
	
   

  	
  MONCLA WELL SERVICE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Newton W. Wilson

  
	
   

  	
   

  	
  Newton W. Wilson III

  
	
   

  	
   

  	
  President and Secretary

  



 


Signature Page to Registration Rights Agreement


 

















 


	
   

  	
  KEY ENERGY SERVICES, LLC

  
	
   

  	
  KEY ENERGY PRESSURE PUMPING SERVICES, LLC

  
	
   

  	
  KEY ENERGY FISHING & RENTAL SERVICES,
  LLC

  
	
   

  	
  KEY ENERGY SHARED SERVICES, LLC

  
	
   

  	
  MISR KEY ENERGY INVESTMENTS, LLC*

  
	
   

  	
  MISR KEY ENERGY SERVICES, LLC*

  
	
   

  	
  KEY ELECTRIC WIRELINE SERVICES, LLC

  
	
   

  	
  KEY ENERGY SERVICES (MEXICO), LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Newton W. Wilson

  
	
   

  	
   

  	
  Newton W. Wilson III

  
	
   

  	
   

  	
  Vice President and Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  *Executing in the capacity of President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BROTHERS OILFIELD SERVICE & SUPPLY,
  L.L.C.

  
	
   

  	
  4M EQUIPMENT & LEASING, L.L.C.

  
	
   

  	
  LCM INDUSTRIES, L.L.C.

  
	
   

  	
  MONCLA MARINE, L.L.C.

  
	
   

  	
  MONCLA DRILLING, L.L.C.

  
	
   

  	
  MONCLA MARINE CREW BOATS, L.L.C.

  
	
   

  	
  MONCLA MARINE OPERATIONS, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 1, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 2, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 3, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 4, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 5, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 6, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 8, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 9, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 10, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 11, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 12, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 14, L.L.C.

  
	
   

  	
  MONCLA MARINE VESSEL NO. 15, L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Newton W. Wilson

  
	
   

  	
   

  	
  Newton W. Wilson III

  
	
   

  	
   

  	
  Manager

  



 


Signature Page to Registration Rights
Agreement


 

















 


	
  Accepted as of the date hereof:

  
	
   

  
	
  LEHMAN BROTHERS INC.

  
	
  BANC OF AMERICA SECURITIES LLC

  
	
  MORGAN STANEY & CO. INCORPORATED

  
	
  As Representatives of the several Purchasers

  
	
   

  
	
   

  
	
  By: LEHMAN BROTHERS INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Matthew J. Savino

  	
   

  
	
   

  	
    Authorized Representative

  



 


Signature Page to Registration Rights
Agreement