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KEY ENERGY SERVICES INC filed this Form S-4/A on 03/08/1996
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Recent Developments

         The Merger and the Interim Operations Agreement.  On November 18, 1995,
Key and WellTech  entered into the Merger  Agreement  pursuant to which WellTech
will  merge  with and into  Key.  (See  "Proposals  to be Voted  upon at the Key
Special Meeting--Item 1: The Merger.")  Simultaneously with the execution of the
Merger  Agreement,   Key  and  WellTech  entered  into  the  Interim  Operations
Agreement. (See "Business and Properties of Key--Recent Developments--The Merger
and the Interim Operations Agreement.") In January 1996, WellTech entered into a
credit  agreement  with  CIT.  (See  "Business  and  Properties  of  Key--Recent
Developments--New Indebtedness .")

         Dawson  WellTech.  Dawson  WellTech,  L.C., a Texas  limited  liability
company,  was owned 61% by Dawson and 39% by  WellTech.  Effective  November  1,
1995,  WellTech exchanged its 39% interest in Dawson WellTech,  L.C. for 309,186
shares of Dawson and  effective  December  31, 1995 Dawson  WellTech,  L.C.  was
merged into Dawson.  WellTech has directed Dawson to distribute the Dawson stock
to the WellTech  shareholders  and directors  prior to the Merger.  In addition,
WellTech has agreed to perform consulting services to Dawson in return for 11.7%
of Dawson's  consolidated  pre-tax  earnings.  This  consulting  agreement  will
terminate on the earlier of (i) March 31, 1996,  (ii) the date Dawson closes and
funds an initial public offering of its securities, or (iii) the date upon which
Dawson shall engage in a business  combination or sell  substantially all of its
assets to another party.

Domestic Operations

        Presently, WellTech conducts its domestic operations in two regions: the
Mid-Continent  Region with  approximately  110 rigs,  12 water haul trucks,  and
other  well  servicing  assets  operating  principally  in  Oklahoma  and  Texas
(confined to East Texas);  and the Northeast Region with  approximately 60 rigs,
68 water haul trucks,  and other well servicing assets operating  principally in
Michigan, Pennsylvania and West Virginia.

        WellTech  provides  services  pursuant  to the terms and  provisions  of
written   (approximately   60%)  and  verbal   (approximately   40%)  contracts,
specifying,  in general,  the equipment to be used,  crew  component,  hourly or
daily rate, payment terms and other terms customary in the industry.  During the
first three quarters of 1995, the major  customers in the  Mid-Continent  Region
were Amoco Production Co., Exxon Co. U.S.A.,  Texaco Exploration and Production,
Inc.,  and Maxus  Exploration,  Inc.; and in the  Northeastern  Region were U.S.
Steel  Mining Co.,  Amoco  Production  Co.,  Bethlehem  Steel  Corporation,  and
Angerman  Associates,  Inc.  No  single  customer  accounted  for 10% or more of
WellTech's  revenues  during  any of  its  last  three  fiscal  years.  WellTech
considers its customer relations to be good.

Foreign Operations

        In 1993 WellTech entered into an agreement with a foreign  subsidiary of
M.D. Seis ("Seis") for the  procurement  and  mobilization of two well servicing
rigs to operate near Kogalym, Russia, under a 700 (initially 500) well servicing