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KEY ENERGY SERVICES INC filed this Form S-4/A on 03/08/1996
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Odessa Exploration Incorporated

On August 5, 1993, Key acquired Odessa  Exploration  Incorporated  ("OEI").  The
effective date of the OEI  acquisition was July 1, 1993, when Key took effective
control.  OEI is  engaged  in the  operation  of oil and  natural  gas wells and
exploration  for oil and natural gas. OEI was acquired in  consideration  of the
issuance of 150,000 shares of Key Common Stock (which had a closing market value
of  approximately  $638,000 at July 1, 1993) to Mr. D. Kirk Edwards,  the former
owner  and the now  current  President  and CEO of OEI,  and the  assumption  of
approximately  $1,811,000 in bank debt.  Key  guaranteed  all of the assumed OEI
bank debt. The acquisition was accounted for as a purchase.

The following  unaudited  pro forma results of operations  have been prepared as
though Clint Hurt  Drilling and WellTech West Texas had been acquired on July 1,

                                                       Year Ended
                                              June 30, 1995      June 30, 1994
                                            (In thousands, except  share data)

   Revenues                                      $50,485             $ 48,069
   Net income                                      2,798                2,146
   Earnings per share:
   Net income                                      $0.40                $0.31
   Weighted average shares outstanding:            6,924                6,914


On October 20,  1992,  Key,  then known as National  Environmental  Group,  Inc.
("NEGI") and several affiliated companies,  filed a Joint Plan of Reorganization
under Chapter 11 of the  Bankruptcy  Code (the  "Prepackaged  Plan").  Under the
Prepackaged Plan, holders of the various debt issues, preferred stockholders and
common stockholders of Key and affiliates received shares of Key Common Stock in
exchange  for their  claims.  On  December  4, 1992,  the  Prepackaged  Plan was
confirmed.  The  Prepackaged  Plan was  implemented by merging Key Energy Group,
Inc.,  a newly  formed,  wholly-owned  subsidiary  of NEGI,  with and into NEGI,
merging  ESKEY  Inc.,  a  wholly-owned   subsidiary  of  NEGI,  into  NEGI,  and
liquidating YFC International,  N.V., another  wholly-owned  subsidiary of NEGI.
The  Articles  of  Incorporation  of  NEGI  were  amended  to (a)  reduce  Key's
authorized  capital  stock to  10,000,000  shares,  (b) prohibit the issuance of
non-voting  equity  securities and (c) change the name to Key Energy Group, Inc.
In connection with the reorganization, a reverse stock split of the common stock
occurred as a result of which each share of NEGI  common  stock  converted  into
 .0178  shares  of Key  Common  Stock,  and each  share of NEGI  preferred  stock
converted into 1.04 shares of Key Common Stock.