Document:

<PAGE>

                                                                    EXHIBIT 10.1
                                                                  CONFORMED COPY

                                 SIXTH AMENDMENT

                  SIXTH AMENDMENT, dated as of July 14, 1999 (this "Amendment"),
to the Second Amended and Restated Credit Agreement, dated as of June 6, 1997,
as amended and restated through September 14, 1998 and as amended by the First
Amendment dated as of November 19, 1998, the Second Amendment dated as of
December 29, 1998, the Third Amendment dated as of April 8, 1999, the Fourth
Amendment dated as of April 15, 1999 and the Fifth Amendment dated as of May 10,
1999 (the "Credit Agreement"), among Key Energy Group, Inc. (now known as Key
Energy Services, Inc.), a Maryland corporation (the "Borrower"), the several
Lenders from time to time parties thereto, PNC Bank, National Association
("PNC"), as Administrative Agent, Norwest Bank Texas, N.A., as Collateral Agent
and PNC Capital Markets, Inc., as Arranger.

                  The parties hereto hereby agree as follows:

                  Section 1. DEFINED TERMS. Unless otherwise defined herein,
terms which are defined in the Credit Agreement and used herein (and in the
recitals hereto) as defined terms are so used as so defined.

                  Section 2.  AMENDMENT TO SUBSECTION 1.1 (DEFINITIONS).
Subsection 1.1 of the Credit Agreement is hereby amended as follows:

                  (a) by inserting in the appropriate alphabetical order the
following new definition of "Designated Joint Venture":

                           "'DESIGNATED JOINT VENTURE': any joint venture,
                  partnership or other similar entity in each case in which the
                  Borrower has made an Investment pursuant to subsection 7.9(q)
                  as a result of which the Borrower has received an ownership
                  interest."; and

                  (b) by deleting the definition of "Foreign Subsidiary" in its
entirety and substituting in lieu thereof the following new definition:

                           "'FOREIGN SUBSIDIARY': any Subsidiary of the Borrower
                  and any Designated Joint Venture which, in each case, is
                  organized under the laws of any jurisdiction outside the
                  United States.";

                  Section 3. AMENDMENTS TO SUBSECTION 2.3. Subsection 2.3 of the
Credit Agreement is hereby amended by deleting paragraphs (a) and (b) therefrom
and substituting in lieu thereof the following:

                           "(a) The Tranche A Term Loan of each Tranche A Lender
                  shall mature in sixteen consecutive quarterly installments
                  commencing on the date fifteen months after the Closing Date,
                  each of which shall be in an amount equal to such Lender's

<PAGE>

                                                                               2

                  Tranche A Term Percentage multiplied by the percentage set
                  forth below opposite such installment of the Tranche A Term
                  Loans outstanding on the Merger Date (after giving effect to
                  any Term Loans made on such date and, in any event, subject to
                  subsection 2.16(b)):

<TABLE>
<CAPTION>

                                          Principal Amount
             Installment                  of each Installment
             -----------                  -------------------
            <S>                           <C>
               1 to 4                        4%

               5 to 8                        6%

              9 to 12                        7%

              13 to 16                       8%
</TABLE>

                           (b) The Tranche B Term Loan of each Tranche B Lender
                  shall mature in nineteen consecutive quarterly installments
                  commencing on the date fifteen months after the Closing Date,
                  each of which shall be in an amount equal to such Lender's
                  Tranche B Term Percentage multiplied by the percentage set
                  forth below opposite such installment of the Trance B Term
                  Loans outstanding on the Merger Date (after giving effect to
                  any Term Loans made on such date and, in any event, subject to
                  subsection 2.16(b)):

<TABLE>
<CAPTION>

                                            Principal Amount
            Installments                    of each Installment
            ------------                    -------------------
<S>         <C>                             <C>
               1 to 4                         0.25%

               5 to 8                         0.25%

              9 to 12                         0.25%

              13 to 16                        0.25%

              17 to 18                       24.00%

                 19                          48.00%"
</TABLE>

                  Section 4. AMENDMENTS TO SUBSECTION 2.10. Subsection 2.10 of
the Credit Agreement is hereby amended by:

                  (a) deleting in its entirety paragraph (b) of subsection 2.10
and substituting in lieu thereof the following new paragraph (b):

                  "(b) Unless the Required Prepayment Lenders shall otherwise
         agree, if any Capital Stock shall be issued by the Borrower or any of
         its Subsidiaries, an amount equal to (i) 100% of the Net Cash Proceeds
         received from all such issuances of Capital Stock

<PAGE>

                                                                               3

         from and after the Closing Date up to an aggregate amount equal to
         $75,000,000, (ii) 55% of the Net Cash Proceeds received from all such
         issuances of Capital Stock from and after the Closing Date in excess of
         an aggregate amount equal to $75,000,000 but less than $165,750,000,
         and (iii) 25% of the Net Cash Proceeds received from all such issuances
         of Capital Stock from and after the Closing Date in excess of an
         aggregate amount equal to $165,750,000 (other than any Net Cash
         Proceeds received as the result of the issuance of Capital Stock by a
         Subsidiary Guarantor or a Foreign Subsidiary (in accordance with
         subsection 7.9(e)) to the Borrower or another Subsidiary), shall be
         applied on the date of such issuance (or, in the case of Net Cash
         Proceeds received as the result of any exercise with respect to
         warrants, rights or options to purchase Capital Stock of the Borrower
         or any Subsidiary, on each date on which the aggregate amount of Net
         Cash Proceeds so received but not previously applied as set forth in
         this subsection 2.10(b) equals or exceeds $5,000,000) toward the
         prepayment of the Term Loans (or reduction of Term Loan Commitments) as
         set forth in Section 2.10(f); PROVIDED that so long as no Event of
         Default has occurred or is continuing pursuant to Sections 8(a),
         8(e)(i), 8(e)(ii), 8(f) or 8(k), Net Cash Proceeds of Capital Stock
         (other than Disqualified Stock) issued by the Borrower may be used to
         prepay the Put Facility and to the extent so used shall not be required
         to be used as mandatory prepayments or Term Loan Commitment reductions
         hereunder."; and

                  (b) deleting subsection 2.10(d) in its entirety and
substituting in lieu thereof the following new subsection 2.10(d):

                  "(d) Unless the Required Prepayment Lenders otherwise agree,
         if the Borrower or any of its Subsidiaries shall receive Net Cash
         Proceeds from any asset sale permitted under Section 7.6(e), then 100%
         of such Net Cash Proceeds shall be applied on the date such Net Cash
         Proceeds are received toward the prepayment of the Term Loans and the
         reduction of the Term Loan Commitments as set forth in Section
         2.10(f)."

                  Section 5. AMENDMENT TO SUBSECTION 4.2 (NO CHANGE). Subsection
4.2 of the Credit Agreement is hereby amended by deleting such subsection in its
entirety and substituting in lieu thereof the following new subsection 4.2:

                  "(a) From June 30, 1998 through March 31, 1999, there has been
no development or event which has had or could reasonably be expected to have a
Material Adverse Effect other than the lower spending levels by oil and gas
producers attributable to the deterioration of prevailing market prices of oil
and gas sustained during such period. Since March 31, 1999, there has been no
development or event which has had or could reasonably be expected to have a
Material Adverse Effect, and (b) during the period from June 30, 1998 to and
including the date hereof no dividends or other distributions have been
declared, paid or made upon the Capital Stock of the Borrower nor has any of the
Capital Stock of the Borrower been redeemed, retired, purchased or otherwise
acquired for value by the Borrower. Without limiting the representation in the
preceding sentence, from June 30, 1998 to the Merger Date there has been no
development or event which, to the best knowledge of the Borrower, has had or
could reasonably be expected

<PAGE>

                                                                               4

to have a material adverse effect on the business, operations, property,
condition (financial or otherwise) or prospects of Dawson and its Subsidiaries
taken as a whole.

                  Section 6. AMENDMENT TO SUBSECTION 4.25 (YEAR 2000 MATTERS).
Subsection 4.25 of the Credit Agreement is hereby amended by deleting the
reference to "July 1, 1999" and substituting in lieu thereof a reference to
"September 30, 1999".

                  Section 7. AMENDMENT TO SUBSECTION 6.9 (FURTHER ASSURANCES).
Subsection 6.9 (b) of the Credit agreement is hereby amended by deleting such
subsection in its entirety and substituting in lieu thereof the following new
subsection 6.9(b):

                  "(b) Notwithstanding any other provision herein, the Borrower
         shall not be deemed to have failed to satisfy the conditions of Section
         5.1(p) or 5.2(c) or to be in violation of Section 6.10 or 6.14 for
         failure to have caused a duly perfected Lien to be placed on any
         Vehicles (other than Excluded Vehicles) covered by a certificate of
         title of any State if the aggregate fair market value of such
         unperfected Vehicles is less than $5,000,000."

                  Section 8. AMENDMENT TO SUBSECTION 7.2(c) (LIMITATION ON
INDEBTEDNESS). Subsection 7.2(c) of the Credit Agreement is hereby amended by
deleting such subsection in its entirety and substituting in lieu thereof the
following new subsection 7.2(c):

                  "(c) Indebtedness (i) of the Borrower to a Wholly Owned
         Subsidiary, (ii) of a Domestic Wholly Owned Subsidiary to the Borrower
         or any other Subsidiary and (iii) of any Foreign Subsidiary to the
         Borrower or any Subsidiary in an aggregate principal amount at any time
         outstanding (with respect to all such Foreign Subsidiaries of the
         Borrower) not to exceed $10,000,000 in excess of the amount of such
         Indebtedness outstanding on September 14, 1998; PROVIDED, that any such
         Indebtedness referred to in this clause (c) provided to Odessa shall be
         for capital expenditure purposes only."

                  Section 9. AMENDMENT TO SUBSECTIONS 7.2(d), (g) AND (j)
(LIMITATION ON INDEBTEDNESS). Subsections 7.2(d), (g) and (j) of the Credit
Agreement are hereby amended by deleting each of the references to "$15,000,000"
contained therein and substituting in lieu of each thereof a reference to
"$25,000,000".

                  Section 10. AMENDMENT TO SUBSECTION 7.4(g) (LIMITATION ON
GUARANTEE OBLIGATIONS). Subsection 7.4(g) of the Credit Agreement is hereby
amended by deleting the reference to "$5,000,000" contained therein and
substituting in lieu thereof a reference to "$7,500,000".

                  Section 11. AMENDMENTS TO SUBSECTION 7.6 (LIMITATION ON SALE
OF ASSETS). Subsection 7.6 of the Credit Agreement is hereby amended:

                  (a) by deleting the proviso contained in subsection 7.6(a) and
         substituting in lieu thereof the following new proviso:

         5
<PAGE>

                     "PROVIDED that (other than inventory and light vehicles)
         the aggregate proceeds received from all assets so sold, leased or
         disposed of in any fiscal year shall not exceed (i) for the fiscal year
         ending June 30, 1999, 10%, and (ii) for each fiscal year thereafter,
         5% of the Borrower's Consolidated Net Worth as of the end of the
         immediately preceding fiscal year;";

                  (b) by deleting subsection 7.6(d) in its entirety and
substituting in lieu thereof the following new subsection 7.6(d):

                  "(d) the sale of Odessa, PROVIDED that the consideration
         received by the Borrower and its Subsidiaries in respect of any such
         sale shall include cash in an amount greater than or equal to the
         greater of (i) 50% of the aggregate consideration received in respect
         of such sale and (ii) $15,000,000 (the "SIGNIFICANT DISPOSITION");
         and"; and

                  (c) by adding the following new paragraph (e):

                  "(e) the sale of any Argentine Subsidiary or all or any
         portion of the assets thereof, PROVIDED that, subject to subsection
         7.9(q), the consideration received by the Borrower and its Subsidiaries
         in respect of any such sale shall be solely in the form of cash."

                  Section 12. AMENDMENT TO SUBSECTION 7.8 (LIMITATION ON CAPITAL
EXPENDITURES). Subsection 7.8 of the Credit Agreement is hereby amended by
deleting each reference to "$30,000,000" contained therein and substituting in
lieu of each thereof a reference to "$37,500,000".

                  Section 13. AMENDMENTS TO SUBSECTION 7.9 (LIMITATION ON
INVESTMENTS, LOANS AND ADVANCES). Subsection 7.9 of the Credit Agreement is
hereby amended as follows:

                  (a) by deleting from the fourth line of the first sentence
         thereof the reference to "any Person, except:" and inserting in lieu
         thereof a reference to "any Person (any of the foregoing, an
         "INVESTMENT"), except:";

                  (b) by deleting subsection 7.9(e) in its entirety and
         substituting in lieu thereof the following new subsection 7.9(e):

                  "(e) loans by the Borrower or any Subsidiary to, and equity
         investments by the Borrower or any Subsidiary in, Foreign Subsidiaries
         in an aggregate amount (or, in the case of loans, outstanding principal
         amount) at any time not to exceed the amount thereof outstanding on
         September 14, 1998, plus $10,000,000 (for all such Foreign
         Subsidiaries, taken together, net of the aggregate amount of any
         dividends or other distributions received by the Borrower and any such
         Subsidiary in respect of such equity investments in Foreign
         Subsidiaries and excluding the amount of any such equity investments in
         a Designated Joint Venture made in accordance with subsection 7.9(q));"

                                                                               6
<PAGE>

                  (c) by deleting from subsection 7.9(i) the reference to
         "$5,000,000" and substituting in lieu thereof "$7,500,000";

                  (d) by deleting subsection 7.9(q) in its entirety and
         substituting in lieu thereof the following new subsection 7.9(q):

                  "(q) any Investments occasioned by the transfer or sale of any
         or all of the Argentine Subsidiaries or all or any portion of the
         assets thereof to any joint venture, partnership or other similar
         entity; PROVIDED that such transfer or sale shall be on terms
         reasonably satisfactory to the Administrative Agent;"

                  (e) by deleting the period at the end of subsection 7.9(r) and
         inserting in lieu thereof a semicolon;

                  (f) by adding the following new paragraph (s):

                  "(s) other Investments not otherwise permitted pursuant to
         this subsection 7.9 in an aggregate amount not to exceed $5,000,000;";

                  (g) by adding the following new paragraph (t):

                  "(t) any Investments made in connection with the Significant
         Disposition; and"; and

                  (h) by adding the following new paragraph (u):

                  "(u) deferred compensation (and/or oil and gas interests taken
         in lieu of cash payment) at any time owing by customers to (or, in the
         case of oil and gas interests, owned by) the Borrower and its
         Subsidiaries (in the case of each such arrangement agreed to on or
         after July [9], 1999, on terms reasonably satisfactory to the
         Administrative Agent) for services rendered to such customers by the
         Borrower and its Subsidiaries, so long as the value of such services
         (as determined in good faith by the Borrower and its Subsidiaries),
         minus the amount of any cash compensation received in respect of such
         services and/or oil and gas interests) does not exceed (i) $15,000,000
         for all such customers and (ii) $5,000,000 for all such customers whose
         long-term debt either (x) has been assigned a rating of less than
         "BBB-" by Standard and Poor's Ratings Services ("S&P") or "Baa3" by
         Moody's Investors Service, Inc. ("MOODY'S") or (y) has not been rated
         by either S&P or Moody's."

                  Section 14. AMENDMENT TO SUBSECTION 7.12 (LIMITATION ON SALES
AND LEASEBACKS). Subsection 7.12 of the Credit Agreement is hereby amended by
deleting each reference to "$15,000,000"contained therein and substituting in
lieu of each thereof a reference to "$25,000,000".

                                                                               7
<PAGE>

                  Section 15. CONDITIONS TO EFFECTIVENESS OF THIS AMENDMENT.
This Amendment shall become effective as of the date (the "Effective Date") that
the Administrative Agent shall have received (a) this Amendment, executed and
delivered by a duly authorized officer of the Borrower and the Required Lenders,
(b) the attached Acknowledgment and Consent, executed and delivered by a duly
authorized officer of each of the signatories thereto, and (c) such other
corporate documents and resolutions as the Administrative Agent may request.

                  Section 16.  MISCELLANEOUS.

                  (a) REPRESENTATIONS AND WARRANTIES. The Borrower represents
         and warrants to the Administrative Agent and the Lenders that as of the
         Effective Date, after giving effect to this Amendment, no Default or
         Event of Default has occurred and is continuing, and the
         representations and warranties made by the Borrower in or pursuant to
         the Credit Agreement or any Loan Documents are true and correct in all
         material respects on and as of the Effective Date as if made on such
         date (except to the extent that any such representations and warranties
         expressly relate to an earlier date, in which case such representations
         and warranties were true and correct in all material respects on and as
         of such earlier date).

                  (b) CONTINUING EFFECT OF THE CREDIT AGREEMENT. This Amendment
         shall not constitute an amendment or waiver of or consent to any
         provision of the Credit Agreement not expressly referred to herein and
         shall not be construed as an amendment, waiver or consent to any action
         on the part of the borrower that would require an amendment, waiver or
         consent to any action on the part of the Borrower that would require an
         amendment, waiver or consent of the Agents or the Lenders except as
         expressly stated herein. Except as expressly consented to hereby, the
         provisions of the Credit Agreement are and shall remain in full force
         and effect.

                  (c) FEES AND EXPENSES. The Borrower agrees to pay or reimburse
         the Administrative Agent on demand for all its reasonable out-of-pocket
         costs and expenses incurred in connection with the preparation and
         execution of this Amendment, including, without limitation, the
         reasonable fees and disbursements of counsel to the Administrative
         Agent.

                  (d) COUNTERPARTS. This Amendment may be executed in any number
         of counterparts (including by telecopy) by the parties hereto, each of
         which counterparts when so executed shall be an original, but all
         counterparts taken together shall constitute one and the same
         instrument.

                  (e)      GOVERNING LAW.  THIS WAIVER AND AMENDMENT AND
         THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE
         GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW
         OF THE STATE OF NEW YORK.

                                                                               8
<PAGE>

                  IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.

                                     KEY ENERGY SERVICES, INC. (formerly
                                     known as Key Energy Group, Inc.)

                                     By: /s/ Thomas K. Grundman
                                        __________________________________
                                     Title: Executive Vice President and Chief
                                            Financial Officer

                                     PNC BANK, NATIONAL ASSOCIATION,
                                     as Administrative Agent and as a Lender

                                     By: /s/ Thomas Majeski
                                        __________________________________
                                     Title: Vice President

<PAGE>

                                     WELLS FARGO BANK

                                     By:
                                         ______________________________________
                                     Title:
                                           ____________________________________

<PAGE>

                                     BANK POLSKA KASA OPIEKI S.A.,
                                     PEKAO S.A. GROUP, NEW YORK
                                     BRANCH

                                     By: /s/ Hussein B. El-Tawil
                                         ______________________________________
                                     Title: Vice President

<PAGE>

                                     BANK LEUMI, USA

                                     By: /s/ Joung Hee Hong
                                         ______________________________________
                                     Title: Vice President

<PAGE>

                                     BOEING CAPITAL CORPORATION

                                     By: /s/ David Nelson
                                         ______________________________________

                                     Title: Special Credits Officer

<PAGE>

                                     THE CIT GROUP/EQUIPMENT
                                     FINANCING, INC.

                                     By:
                                         ______________________________________
                                     Title:

<PAGE>

                                     KZH HIGHLAND-2 LLC

                                     By: /s/ Peter Chin
                                         ______________________________________
                                     Title: Authorized Agent

                                     KZH PAMCO LLC

                                     By: /s/ PETER CHIN
                                         ______________________________________
                                     Title: Authorized Agent

<PAGE>

                                     BEAR STEARNS INVESTMENT
                                     PRODUCT INC.

                                     By: /s/ Harry Rosenberg
                                         ______________________________________
                                     Title: Authorized Signatory

<PAGE>

                                     Crescent/Mach I Partners, L.P.
                                     by: TCW Asset Management Company
                                     its investment Manager

                                     By: /s/ Justin L. Driscoll
                                         ______________________________________
                                     Title: Senior Vice President

<PAGE>

                                     Continental Assurance Company
                                     Separate Account (E)
                                     By: TCW Asset Management Company
                                     as Attorney-in-Fact

                                     By: /s/ Mark L. Gold
                                         ______________________________________
                                     Title: Managing Director

                                     By: /s/ Justin L. Driscoll
                                         ______________________________________
                                     Title: Senior Vice President

<PAGE>

                                     United Of Omaha Life Insurance Company
                                     By: TCW Asset Management Company,
                                     its Investment Advisor

                                     By: /s/ Justin L. Driscoll
                                         ______________________________________
                                     Title: Senior Vice President

                                     By: /s/ Jonathan R. Insull
                                         ______________________________________
                                     Title: Vice President

<PAGE>

                                     SEQUILS 1. LTD

                                     By: TCW Advisors, Inc. as its Collateral
                                     Manager

                                     By: /s/ Justin L. Driscoll
                                         ______________________________________
                                     Title: Senior Vice President

                                     By: /s/ Jonathan R. Insull
                                         ______________________________________
                                     Title: Vice President

<PAGE>

                                     ELC (CAYMAN) LTD. CDO SERIES
                                     1999-1

                                     By: /s/ Mark B. Mahoney
                                         ______________________________________
                                     Title: President

<PAGE>

                                     INDOSUEZ CAPITAL FUNDING IV, L.P.

                                     By: /s/ MELISSA MARANO
                                         ______________________________________
                                     Title: Vice President

                                     INDOSUEZ CAPITAL FUNDING IIA,
                                     LIMITED

                                     By: /s/ MELISSA MARANO
                                         ______________________________________
                                     Title: Vice President

<PAGE>

                                     PAMCO CAYMAN LTD.

                                     By:   Highland Capital Management, L.P., as
                                           Collateral Manager

                                     By: /s/ James Dondero
                                         ______________________________________
                                     Title: President
                                     Highland Capital Management, L.P.

                                     ML CBO IV (Cayman)

                                     By: Highland Capital Management, L.P., as
                                         Collateral Agent

                                     By: /s/ James Dondero
                                         ______________________________________
                                     Title: President
                                     Highland Capital Management, L.P.

                                     PAM CAPITAL FUNDING, L.P.
                                     By: Highland Capital Management, L.P., as
                                         Collateral Manager

                                     By: /s/ James Dondero
                                         ______________________________________
                                     Title: President
                                     Highland Capital Management, L.P.

<PAGE>

                                     ML CLO XX PILGRIM AMERICA
                                     (CAYMAN) LTD.

                                     By:      Pilgrim Investments, Inc. as its
                                              Investment Manager

                                     By: /s/ Robert L. Wilson
                                          ______________________________________
                                     Title: Vice President

                                     PILGRIM PRIME RATE TRUST

                                     By:      Pilgrim Investments, Inc., as its
                                              Investment Manager

                                     By: /s/ Robert L. Wilson
                                         ______________________________________
                                     Title: Vice President

<PAGE>

                                     MERRILL LYNCH PRIME RATE
                                     PORTFOLIO

                                     By:      Merrill Lynch Asset Management,
                                              L.P., as Investment Advisor

                                     By: /s/ Giles Marchand
                                         ______________________________________
                                     Title: Authorized Signatory

<PAGE>

                                     MERRILL LYNCH SENIOR FLOATING
                                     RATE FUND, INC.

                                     By: /s/ Giles Marchand
                                         ______________________________________
                                     Title: Authorized Signatory

                                     MERRILL LYNCH SENIOR FLOATING
                                     RATE FUND II, INC.

                                     By: /s/ Giles Marchand
                                         ______________________________________
                                     Title: Authorized Signatory

                                     MERRILL LYNCH DEBT STRATEGIES
                                     FUND II, INC.

                                     By: /s/ Giles Marchand
                                         ______________________________________
                                     Title: Authorized Signatory

                                     MERRILL LYNCH DEBT STRATEGIES
                                     FUND III, INC.

                                     By: /s/ Giles Marchand
                                         ______________________________________
                                     Title: Authorized Signatory

<PAGE>

                           ACKNOWLEDGMENT AND CONSENT

                  Each of the undersigned corporations, as a guarantor under
that certain Amended and Restated Master Guarantee and Collateral Agreement,
dated as of June 6, 1997, as amended and restated through September 14, 1998 (as
amended, supplemented or otherwise modified from time to time, the "GUARANTEE"),
made by each of such corporations in favor of the Collateral Agent, acknowledges
the foregoing amendment and confirms and agrees that the Guarantee is, and shall
continue to be, in full force and effect and is hereby ratified and confirmed in
all respects and the guarantee and all of the Collateral (as defined in the
Guarantee) do, and shall continue to, secure the payment of all of the
Obligations (as defined in the Guarantee) pursuant to the terms of the
Guarantee. Capitalized terms not otherwise defined herein shall have the
meanings assigned to them in the Credit Agreement referred to in the Amendment
to which this Acknowledgment and Consent is attached.

                                    YALE E. KEY, INC.
                                    KEY ENERGY DRILLING, INC.
                                    WELLTECH EASTERN, INC.
                                    ODESSA EXPLORATION INCORPORATED
                                    KALKASKA OILFIELD SERVICES, INC.
                                    WELL-CO OIL SERVICE, INC.
                                    PATRICK WELL SERVICE, INC.
                                    MOSLEY WELL SERVICE, INC.
                                    RAM OIL WELL SERVICE, INC.
                                    ROWLAND TRUCKING CO., INC.
                                    LANDMARK FISHING & RENTAL, INC.
                                    DUNBAR WELL SERVICE, INC.
                                    FRONTIER WELL SERVICE, INC.
                                    KEY ROCKY MOUNTAIN, INC.
                                    KEY FOUR CORNERS, INC.
                                    JETER SERVICE CO.
                                    JETER WELL SERVICE, INC.
                                    JETER TRANSPORTATION, INC.
                                    INDUSTRIAL OILFIELD SUPPLY, INC.
                                    BROOKS WELL SERVICING, INC.
                                    UPDIKE BROTHERS, INC.
                                    J.W. GIBSON WELL SERVICE COMPANY
                                    KEY ENERGY SERVICES-SOUTH TEXAS, INC.
                                    WATSON OILFIELD SERVICE & SUPPLY, INC.
                                    WELLTECH MID-CONTINENT, INC.

<PAGE>

                                    DAWSON PRODUCTION MANAGEMENT, INC.
                                    DAWSON PRODUCTION ACQUISITION CORP.
                                    DAWSON PRODUCTION TAYLOR, INC.
                                    KEY ENERGY SERVICES-CALIFORNIA, INC.

                                     By: /s/ Thomas K. Grundman
                                        ________________________________________
                                     Title: Vice President of each of the
                                            foregoing companies

                                     DAWSON PRODUCTION PARTNERS, L.P.

                                             By:      DAWSON PRODUCTION
                                                      MANAGEMENT, INC., Its sole
                                                      general partner,

                                     By: /s/ Thomas K. Grundman
                                        ________________________________________
                                        Title: Vice President<PAGE>

                                                                    EXHIBIT 10.2
                                                                  CONFORMED COPY

                                SEVENTH AMENDMENT

                  SEVENTH AMENDMENT, dated as of March 1, 2000 (this
"Amendment"), to the Second Amended and Restated Credit Agreement, dated as of
June 6, 1997, as amended and restated through September 14, 1998 and as amended
by the First Amendment dated as of November 19, 1998, the Second Amendment dated
as of December 29, 1998, the Third Amendment dated as of April 8, 1999, the
Fourth Amendment dated as of April 15, 1999, the Fifth Amendment dated as of May
10, 1999 and the Sixth Amendment dated as of July 14, 1999 (the "Credit
Agreement"), among Key Energy Group, Inc. (now known as Key Energy Services,
Inc.), a Maryland corporation (the "Borrower"), the several Lenders from time to
time parties thereto, PNC Bank, National Association ("PNC"), as Administrative
Agent, Norwest Bank Texas, N.A., as Collateral Agent and PNC Capital Markets,
Inc., as Arranger.

                  The parties hereto hereby agree as follows:

                  Section 1. DEFINED TERMS. Unless otherwise defined herein,
terms which are defined in the Credit Agreement and used herein (and in the
recitals hereto) as defined terms are so used as so defined.

                  Section 2. AMENDMENT TO SUBSECTION 1.1 (DEFINITIONS).
Subsection 1.1 of the Credit Agreement is hereby amended by inserting in the
appropriate alphabetical order the following new definition of "Production
Payment Transaction":

                           "'PRODUCTION PAYMENT TRANSACTION': the sale by
                  Odessa, pursuant to a production payment of a specified
                  quantity of hydrocarbons to be produced from oil and gas
                  interests owned by Odessa for an aggregate purchase price of
                  at least $15,000,000."

                  Section 3. AMENDMENT TO SUBSECTION 7.2 (LIMITATION ON
INDEBTEDNESS). Subsection 7.2 of the Credit Agreement is hereby amended as
follows:

                  (a) by deleting from paragraph (c) the reference to
         "$10,000,000" and substituting in lieu thereof a reference to
         "$20,000,000"; and by adding the following immediately after the
         reference to "September 14, 1998":

                           ", plus any amount loaned in connection with the
                  acquisition of any Foreign Subsidiary listed on Schedule
                  7.9(c);";

                  (b) by deleting from paragraph (d) the reference to
         "$25,000,000" and substituting in lieu thereof a reference to
         "$30,000,000";

                  (c) by deleting from paragraph (g) the reference to
         "$25,000,000" and substituting in lieu thereof a reference to
         "$30,000,000";

<PAGE>

                  (d) by deleting from paragraph (j) the reference to
         "$25,000,000" and substituting in lieu thereof a reference to
         "$30,000,000";
                  (e) by deleting the word "and"  at the end of paragraph (l);

                  (f) by deleting the period at the end of paragraph (m) and
         substituting in lieu thereof a semicolon and the word "and"; and

                  (g) by adding the following new paragraph (n):

                           "(n) in the event that the Production Payment
                  Transaction involves the incurrence of Indebtedness,
                  Indebtedness represented thereby.

                  Section 4. AMENDMENTS TO SUBSECTION 7.3 (LIMITATION ON LIENS).
Subsection 7.3 of the Credit Agreement is hereby amended as follows:

                  (a) by deleting the word "and" at the end of paragraph (k);

                  (b) by deleting the period at the end of paragraph (l) and
         substituting in lie thereof a semicolon and the word "and"; and

                  (c) by adding the following new paragraph (m):

                           "(m) Liens on oil and gas properties and stock of
                  Odessa, arising in connection with the Production Payment
                  Transaction.".

                  Section 5.  AMENDMENTS TO SUBSECTION 7.6 (LIMITATION ON SALE
OF ASSETS). Subsection 7.6 of the Credit Agreement is hereby amended as follows:

                  (a) by deleting the word "and" at the end of paragraph (c);

                  (b) by deleting the word "and" at the end of paragraph (d);

                  (c) by deleting the period at the end of paragraph (e) and
         substituting in lieu thereof a semicolon;

                  (d) by adding the following new paragraph (f):

                           "(f) Odessa may consummate the Production Payment
                  Transaction, PROVIDED that $10,000,000 of the proceeds is used
                  to prepay the Term Loans; and"; and

                  (e) by adding the following new paragraph (g):

                                                                               2
<PAGE>

                           "(g) the swap of a portion of the Borrower's
                  production testing, slickline, wireline and pipe testing
                  business in Texas and Louisiana in exchange for trucking
                  assets of substantially equivalent value, PROVIDED that (i)
                  the fair market value of the assets swapped by the Borrower in
                  the asset swap is no more than $10,000,000 and (ii) the
                  Borrower shall comply with the provisions of Section
                  6.10 with respect to the trucking assets acquired by the
                  Borrower in the asset swap."

                  Section 6. AMENDMENT TO SECTION 7.8 (LIMITATION ON CAPITAL
EXPENDITURES). Section 7.8 of the Credit Agreement is hereby amended as follows:

                  (a) by adding after "Significant Disposition" in Subsection
         7.8(a) the words "or the Production Payment Transaction"; and

                  (b) by adding the following after the reference to "plus (ii)"
in Subsection 7.8(b):

                           "the amount of any Indebtedness incurred pursuant to
                  Subsection 7.2(d) during such fiscal year plus (iii)".

                  Section 7. AMENDMENT TO SECTION 7.9 (LIMITATION ON
INVESTMENTS, LOANS AND ADVANCES). Section 7.9 of the Credit Agreement is hereby
amended as follows:

                  (a) Subsection 7.9(d) of the Credit Agreement is hereby
         amended to read in its entirety as follows:

                           "(d) Permitted Acquisitions after the Merger Loan
Date and the exchange of assets permitted by Subsection 7.6(g)";

                  (b) Subsection 7.9(e) of the Credit Agreement is hereby
         amended to read in its entirety as follows:

                           "(e) loans by the Borrower or any Subsidiary to, and
                  equity investments by the Borrower or any Subsidiary in,
                  Foreign Subsidiaries in an aggregate amount (or, in the case
                  of loans, outstanding principal amount) at any time not to
                  exceed the amount thereof outstanding on September 14, 1998,
                  plus any amount invested in the acquisition of any Foreign
                  Subsidiaries listed on Schedule 7.9(c), plus $20,000,000 (for
                  all such Foreign Subsidiaries, taken together, net of the
                  aggregate amount of any dividends or other distributions
                  received by the Borrower and any such Subsidiary in respect of
                  such equity investments in Foreign Subsidiaries and excluding
                  the amount of any such equity investments in a Designated
                  Joint Venture made in accordance with Subsection 7.9(q)),
                  PROVIDED that, of the amounts of investments in Foreign
                  Subsidiaries made pursuant to this paragraph after the
                  effective date of the Seventh Amendment hereto, not more than
                  $5,000,000 may be loaned to, or invested in, Foreign
                  Subsidiaries in the form of cash or Cash Equivalents and the
                  remaining amount which may be loaned to or

                                                                               3
<PAGE>

                  invested in Foreign Subsidiaries shall be in the form of loans
                  or contributions of supplies, equipment and other non-cash
                  items;"; and

                  (c) Subsection 7.9(f) of the Credit Agreement is hereby
         amended to read in its entirety as follows:

                 "(f) as permitted by Subsection 7.2(c)(iii);".

                  Section 8.AMENDMENT TO SUBSECTION 7.10 (LIMITATION ON OPTIONAL
PAYMENTS AND MODIFICATIONS OF DEBT INSTRUMENTS AND ORGANIZATIONAL DOCUMENTS,
ETC.). Subsection 7.10 of the Credit Agreement is hereby amended by adding the
following new sentence at the end of such Subsection:

                            "Notwithstanding anything to the contrary contained
                  in the foregoing, the Borrower may apply to the purchase of
                  Indebtedness (including the Convertible Subordinated
                  Debentures, the 1997 Convertible Subordinated Notes and the
                  Senior Subordinated Notes) the sum of (i) up to $75,000,000 of
                  the Net Cash Proceeds of any issuance of its Capital Stock,
                  PROVIDED that the Borrower shall have applied toward
                  prepayment of the Term Loans the portion of such Net Cash
                  Proceeds required by Subsection 2.10, and (ii) all the sale
                  proceeds of the Production Payment Transaction in excess of
                  the amount to be applied to prepay the Term Loans pursuant to
                  Section 7.6(f)."

                  Section 9. INSTRUCTION OF COLLATERAL AGENT. The Lenders hereby
instruct the Collateral Agent to release its Liens on the stock and assets of
Odessa upon receipt by the Collateral Agent of written notice from the Borrower
that the Borrower is ready, willing and able to consummate the Production
Payment Transaction and to comply with the provisions of Subsection 7.6(f).

                  Section 10. RESIGNATION OF COLLATERAL AGENT; APPOINTMENT OF
SUCCESSOR COLLATERAL AGENT. If Norwest Bank Texas N.A., gives notice of
resignation as Collateral Agent pursuant to Section 9.9 of the Credit Agreement
within ninety (90) days of the Effective Date (as defined below), the Required
Lenders hereby approve the future appointment of PNC Bank, National Association
as the successor Collateral Agent, and the Borrower hereby consents pursuant to
Section 9.9 of the Credit Agreement.

                  Section 11. CONDITIONS TO EFFECTIVENESS OF THIS AMENDMENT.
This Amendment shall become effective as of the date (the "Effective Date") that
the Administrative Agent shall have received (a) this Amendment, executed and
delivered by a duly authorized officer of the Borrower and the Required Lenders,
(b) the attached Acknowledgment and Consent, executed and delivered by a duly
authorized officer of each of the signatories thereto, (c) from the Borrower, an
amendment fee of 5.0 basis points on the Aggregate Exposure as in effect on the
Effective Date of each Lender consenting to the Amendment, such amendment fee to
be payable to the Administrative Agent for the account of such Lender, on the
Effective Date, and (d) such other corporate documents and resolutions as the
Administrative Agent may request.

                                                                              4
<PAGE>

                  Section 12. MISCELLANEOUS.

                  (a) REPRESENTATIONS AND WARRANTIES. The Borrower represents
and warrants to the Administrative Agent and the Lenders that as of the
Effective Date, after giving effect to this Amendment, no Default or Event of
Default has occurred and is continuing, and the representations and warranties
made by the Borrower in or pursuant to the Credit Agreement or
any Loan Documents are true and correct in all material respects on and as of
the Effective Date as if made on such date (except to the extent that any such
representations and warranties expressly relate to an earlier date, in which
case such representations and warranties were true and correct in all material
respects on and as of such earlier date).

                  (b) CONTINUING EFFECT OF THE CREDIT AGREEMENT. This Amendment
shall not constitute an amendment or waiver of or consent to any provision of
the Credit Agreement not expressly referred to herein and shall not be construed
as an amendment, waiver or consent to any action on the part of the borrower
that would require an amendment, waiver or consent to any action on the part of
the Borrower that would require an amendment, waiver or consent of the Agents or
the Lenders except as expressly stated herein. Except as expressly consented to
hereby, the provisions of the Credit Agreement are and shall remain in full
force and effect.

                  (c) FEES AND EXPENSES. The Borrower agrees to pay or reimburse
the Administrative Agent on demand for all its reasonable out-of-pocket costs
and expenses incurred in connection with the preparation and execution of this
Amendment, including, without limitation, the reasonable fees and disbursements
of counsel to the Administrative Agent.

                  (d) COUNTERPARTS. This Amendment may be executed in any number
of counterparts (including by telecopy) by the parties hereto, each of which
counterparts when so executed shall be an original, but all counterparts taken
together shall constitute one and the same instrument.

                  (e)    GOVERNING LAW.  THIS WAIVER AND AMENDMENT AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL
BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

                                                                               5
<PAGE>

                  IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.

                                     KEY ENERGY SERVICES, INC. (formerly
                                     known as Key Energy Group, Inc.)

                                     By:  /s/ THOMAS K. GRUNDMAN
                                        ________________________________________
                                     Title: Vice President

                                     PNC BANK, NATIONAL ASSOCIATION,
                                     as Administrative Agent and as a Lender

                                     By: /s/ Thomas A. Majeski
                                        ________________________________________
                                     Title: Vice President

<PAGE>

                                     BANK POLSKA KASA OPIEKI S.A.,
                                     PEKAO S.A. GROUP, NEW YORK
                                     BRANCH

                                     By: /s/ Barry W. Henry
                                        ________________________________________
                                     Title: Vice President

<PAGE>

                                     BANK LEUMI, USA

                                     By: /s/ Joung Hee Hong
                                        _______________________________________
                                     Title: Vice President

<PAGE>

                                     BOEING CAPITAL CORPORATION

                                     By:
                                        _______________________________________
                                     Title:

<PAGE>

                                     THE CIT GROUP/EQUIPMENT
                                     FINANCING, INC.

                                     By: /s/ Daniel E. A. Nichols
                                         _______________________________________
                                     Title: Assistant Vice President

<PAGE>

                                     KZH CRESCENT LLC

                                     By: /s/ Peter Chin
                                        ________________________________________
                                     Title: Authorized Agent

                                     KZH CRESCENT-2 LLC

                                     By: /s/ Peter Chin
                                        ________________________________________
                                     Title: Authorized Agent

                                     KZH CRESCENT-3 LLC

                                     By: /s/ Peter Chin
                                        ________________________________________
                                     Title: Authorized Agent

<PAGE>

                                     KZH HIGHLAND-2 LLC

                                     By: /s/ Peter Chin
                                        ________________________________________
                                     Title: Authorized Agent

                                     KZH PAMCO LLC

                                     By: /s/ Peter Chin
                                        ________________________________________
                                     Title: Authorized Agent

<PAGE>

                                     BEAR STEARNS INVESTMENT
                                     PRODUCT INC.

                                     By:
                                        ________________________________________
                                     Title:
                                        ________________________________________

<PAGE>

                                     Crescent/Mach I Partners, L.P.
                                     by: TCW Asset Management Company
                                     its investment Manager

                                     By: /s/ Jonathan R. Insull
                                        ________________________________________
                                     Title: Vice President

<PAGE>

                                     Continental Assurance Company
                                     Separate Account (E)
                                     By: TCW Asset Management Company
                                     as Attorney-in-Fact

                                     By: /s/ Mark L. Gold
                                        ________________________________________
                                     Title: Managing Director

                                     By: /s/ Jonathan R. Insull
                                        ________________________________________
                                     Title: Vice President

<PAGE>

                                     United Of Omaha Life Insurance Company
                                     By: TCW Asset Management Company,
                                     its Investment Advisor

                                     By: /s/ Mark L. Gold
                                        ________________________________________
                                     Title: Managing Director

                                     By: /s/ Jonathan R. Insull
                                        ________________________________________
                                     Title: Vice President

<PAGE>

                                     SEQUILS 1. LTD

                                     By: TCW Advisors, Inc. as its Collateral
                                     Manager

                                     By: /s/ Mark L. Gold
                                        ________________________________________
                                     Title: Managing Director

                                     By: /s/ Jonathan R. Insull
                                        ________________________________________
                                     Title: Vice President

<PAGE>

                                     ELC (CAYMAN) LTD. CDO SERIES
                                     1999-1

                                     By: /s/ Joseph H. Towell
                                        ________________________________________
                                     Title: Senior Vice President

<PAGE>

                                     INDOSUEZ CAPITAL FUNDING IV, L.P.

                                     By: Indosuez Capital as Portfolio Advisor

                                     By: /s/ Melissa Marano
                                        ________________________________________
                                     Title: Vice President

                                     INDOSUEZ CAPITAL FUNDING IIA,
                                     LIMITED

                                     By: Indosuez Capital as Portfolio Advisor

                                     By: /s/ Melissa Marano
                                        ________________________________________
                                     Title: Vice President

<PAGE>

                                     PAMCO CAYMAN LTD.

                                     By:      Highland Capital Management, L.P.,
                                              as Collateral Manager

                                     By: /s/ James Dondero, CFA, CPA
                                        ________________________________________
                                     Title: President
                                            Highland Capital Management, L.P.

                                     ML CBO IV (Cayman)

                                     By: Highland Capital Management, L.P.
                                     as Collateral Agent

                                     By:  /s/ James Dondero, CFA, CPA
                                        ________________________________________

                                     Title:  President
                                     Highland Capital Management, L.P.

                                     PAM CAPITAL FUNDING, L.P.
                                     By: Highland Capital Management, L.P.
                                     as Collateral Manager

                                     By: /s/ James Dondero, CFA, CPA
                                        ________________________________________
                                     Title: President
                                            Highland Capital Management, L.P.

<PAGE>

                                     ML CLO XX PILGRIM AMERICA
                                     (CAYMAN) LTD.

                                     By:      Pilgrim Investments, Inc. as its
                                              Investment Manager

                                     By: /s/ Charles E. Lemieux, CFA
                                        ________________________________________
                                     Title: Assistant Vice President

                                     PILGRIM PRIME RATE TRUST

                                     By:      Pilgrim Investments, Inc., as its
                                              Investment Manager

                                     By: /s/ Charles E. Lemieux, CFA
                                        ________________________________________
                                     Title: Assistant Vice President

<PAGE>

                                     MERRILL LYNCH PRIME RATE
                                     PORTFOLIO

                                     By:      Merrill Lynch Asset Management,
                                              L.P., as Investment Advisor

                                     By: /s/ Giles Marchand, CFA
                                        ________________________________________
                                     Title: Authorized Signatory

<PAGE>

                                     MERRILL LYNCH SENIOR FLOATING
                                     RATE FUND, INC.

                                     By: /s/ Giles Marchand, CFA
                                        ________________________________________
                                     Title: Authorized Signatory

                                     MERRILL LYNCH SENIOR FLOATING
                                     RATE FUND II, INC.

                                     By: /s/ Giles Marchand, CFA
                                        ________________________________________
                                     Title: Authorized Signatory

                                     MERRILL LYNCH DEBT STRATEGIES
                                     FUND II, INC.

                                     By: /s/ Giles Marchand, CFA
                                        ________________________________________
                                     Title: Authorized Signatory

                                     MERRILL LYNCH DEBT STRATEGIES
                                     FUND III, INC.

                                     By: /s/ Giles Marchand, CFA
                                        ________________________________________
                                     Title: Authorized Signatory

<PAGE>

                                     LEHMAN COMMERCIAL PAPER INC.

                                     By: /s/ Michele Swanson
                                         _______________________________________
                                     Title: Authorized Signatory

<PAGE>

                           ACKNOWLEDGMENT AND CONSENT

                  Each of the undersigned corporations, as a guarantor under
that certain Amended and Restated Master Guarantee and Collateral Agreement,
dated as of June 6, 1997, as amended and restated through September 14, 1998 (as
amended, supplemented or otherwise modified from time to time, the "GUARANTEE"),
made by each of such corporations in favor of the Collateral Agent, acknowledges
the foregoing amendment and confirms and agrees that the Guarantee is, and shall
continue to be, in full force and effect and is hereby ratified and confirmed in
all respects and the Guarantee and all of the Collateral (as defined in the
Guarantee) do, and shall continue to, secure the payment of all of the
Obligations (as defined in the Guarantee) pursuant to the terms of the
Guarantee. Capitalized terms not otherwise defined herein shall have the
meanings assigned to them in the Credit Agreement referred to in the Amendment
to which this Acknowledgment and Consent is attached.

                                     YALE E. KEY, INC.
                                     KEY ENERGY DRILLING, INC.
                                     WELLTECH EASTERN, INC.
                                     ODESSA EXPLORATION INCORPORATED
                                     KALKASKA OILFIELD SERVICES, INC.
                                     WELL-CO OIL SERVICE, INC.
                                     PATRICK WELL SERVICE, INC.
                                     MOSLEY WELL SERVICE, INC.
                                     RAM OIL WELL SERVICE, INC.
                                     ROWLAND TRUCKING CO., INC.
                                     LANDMARK FISHING & RENTAL, INC.
                                     DUNBAR WELL SERVICE, INC.
                                     FRONTIER WELL SERVICE, INC.
                                     KEY ROCKY MOUNTAIN, INC.
                                     KEY FOUR CORNERS, INC.
                                     JETER SERVICE CO.
                                     JETER WELL SERVICE, INC.
                                     JETER TRANSPORTATION, INC.
                                     INDUSTRIAL OILFIELD SUPPLY, INC.
                                     BROOKS WELL SERVICING, INC.
                                     UPDIKE BROTHERS, INC.
                                     J.W. GIBSON WELL SERVICE COMPANY
                                     KEY ENERGY SERVICES-SOUTH TEXAS, INC.
                                     WATSON OILFIELD SERVICE & SUPPLY, INC.
                                     WELLTECH MID-CONTINENT, INC.

<PAGE>

                                     DAWSON PRODUCTION MANAGEMENT, INC.
                                     DAWSON PRODUCTION ACQUISITION CORP.
                                     DAWSON PRODUCTION TAYLOR, INC.
                                     KEY ENERGY SERVICES-CALIFORNIA, INC.

                                     By:  /s/ Thomas k. Grundman
                                         _______________________________________
                                           Title: Vice President

                                     DAWSON PRODUCTION PARTNERS, L.P.

                                            By:      DAWSON PRODUCTION
                                                     MANAGEMENT, INC., Its sole
                                                     general partner,

                                     By:  /s/ Thomas k. Grundman
                                         _______________________________________
                                        Title: Vice President

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