Key Energy noteholders consent to extension of reporting periods

New York, April 6 - Key Energy Services, Inc. said holders of a majority of its 6 3/8% senior notes due 2013 and 8 3/8% senior notes due 2008 have consented to amend the note indenture.

The changes extend the periods within which the company must file annual and quarterly reports for 2003, 2004 and 2005.

Under the amended note indenture, the Midland, Texas, oilfield services company has a waiver until May 31 of defaults from its failure to comply with reporting requirements for 2003, until July 31 for 2004 reports and until Aug. 31 for reports for the first two fiscal quarters of 2005.

Key Energy will pay to noteholders $3.75 per $1,000 principal amount for the delays for 2003 and 2004 for a total of $1.6 million.

In addition, the company will pay $1.25 per $1,000 principal amount on the first day of each month starting May that the reporting requirements are not met for 2004 and the first three quarters of 2004.

Key Energy said it does not expect to make the 2004 filings before June.

On July 1, the company will make a one-time payment of $1.25 per $1,000 principal amount if it has not filed its first quarter 2005 10-Q report. It will make a further $1.25 per $1,000 principal amount payment if it has not filed its first and second quarter 2005 10-Q reports by Aug. 10.

If the 10-K annual report for 2003 is not filed by April 30, Key Energy will pay $3.75 per $1,000 principal amount.

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