UNITED OILFIELD SERVICES INC, S-1/A, 1998-01-09

UNITED OILFIELD SERVICES INC
S-1/A, 1998-01-09
OIL & GAS FIELD MACHINERY & EQUIPMENT

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 9, 1998
REGISTRATION NO. 333-38559

================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

AMENDMENT NO. 1 TO
FORM S-1

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
UNITED OILFIELD SERVICES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

TEXAS 74-2856284 3533
(STATE OR OTHER (PRIMARY STANDARD
JURISDICTION OF INDUSTRIAL
INCORPORATION OR (I.R.S. EMPLOYER CLASSIFICATION CODE
ORGANIZATION) IDENTIFICATION NO.) NUMBER)

615 UPPER NORTH BROADWAY
SUITE 950, MT-198
CORPUS CHRISTI, TEXAS 78477
(512) 882-3536
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

------------------------

ALVIN H. DUEITT, PRESIDENT
615 UPPER NORTH BROADWAY
SUITE 950, MT-198
CORPUS CHRISTI, TEXAS 78477
(512) 882-3536
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)

------------------------

COPIES TO:
R. CLYDE PARKER, JR., ESQ. SAMUEL E. WING, ESQ.
WINSTEAD SECHREST & MINICK P.C. JONES & KELLER, P.C.
910 TRAVIS, SUITE 2400 1625 BROADWAY, SUITE 1600
HOUSTON, TEXAS 77002 DENVER, COLORADO 80202

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act,
check the following box. [ ]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ] _________________________

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] _________________________

If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] _________________________

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following
box. [ ]

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
=====================================================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER UNIT OFFERING PRICE FEE(1)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock $0.01 par value......... 1,100,000 $7.00 $7,700,000 $2,327.50
=====================================================================================================================
</TABLE>
(1) Calculated pursuant to Rule 457(o) of the rules and regulations under the
Securities Act of 1933, as amended at the rate in effect on October 23, 1997
with respect to the 1,000,000 shares on behalf of which this Registration
Statement was initially filed and at the rate currently in effect (resulting
in an additional fee of $206.50) with respect to the 100,000 shares added in
this filing.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
<PAGE>
UNITED OILFIELD SERVICES, INC.
CROSS-REFERENCE SHEET

This cross-reference sheet is provided pursuant to Item 501(b) of
Regulation S-K showing the location in the Prospectus of information required by
Part I of Form S-1:
<TABLE>
<CAPTION>
FORM S-1 ITEM LOCATION IN PROSPECTUS
- ------------------------------------- --------------------------------------------------------
<S> <C>
1. Forepart of the Registration
Statement and Outside Front
Cover Page of Prospectus........ Front of Registration Statement and Outside Front Cover
Page of Prospectus

2. Inside Front and Outside Back
Cover Pages of Prospectus....... Inside Front Cover Page and Outside Back Cover Page of
Prospectus

3. Summary Information, Risk
Factors and Ratio of Earnings
to Fixed Charges................ Prospectus Summary; Risk Factors; Selected Financial
Information

4. Use of Proceeds................. Prospectus Summary; Use of Proceeds

5. Determination of Offering
Price........................... Outside Front Cover Page of Prospectus; Risk Factors;
Underwriting

6. Dilution........................ Dilution

7. Selling Security Holders........ Inapplicable

8. Plan of Distribution............ Outside Front and Inside Cover Pages of Prospectus;
Underwriting

9. Description of Securities to be
Registered...................... Outside Front Cover Page of Prospectus; Prospectus
Summary; Capitalization; Description of Securities

10. Interests of Named Experts and
Counsel......................... Legal Matters; Experts

11. Information with Respect to the
Registrant...................... Prospectus Summary; The Company; Risk Factors;
Management's Discussion and Analysis of Financial
Condition and Results of Operations; Dividend Policy;
Capitalization; Selected Financial Information;
Management; Certain Transactions; Description of
Securities; Securities Ownership of Management and
Certain Beneficial Holders; Index to Financial
Statements

12. Disclosure of Commission
Position on Indemnification
for Securities Act Liabilities.. Inapplicable
</TABLE>
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.

SUBJECT TO COMPLETION, DATED JANUARY 9, 1998

PROSPECTUS

[LOGO]

UNITED OILFIELD SERVICES, INC.
1,100,000 SHARES OF
COMMON STOCK

United Oilfield Services, Inc., a Texas corporation (the "Company")
organized in October 1997, hereby offers 1,100,000 shares (the "Offering") of
the common stock, par value $.01 per share, of the Company (the "Common
Stock"). The Common Stock is being offered through D. E. Frey & Company, Inc.
(the "Underwriter").

Before the Offering, there has been no trading market for the Common Stock,
and there can be no assurance that any such market for the Common Stock will
develop after the closing of the Offering or that, if developed, it will be
sustained. It is currently estimated that the initial public offering price will
be between $5.00 and $7.00 per share. The Underwriter has indicated that it
intends to make a market in the Common Stock after the Offering, although the
Underwriter may discontinue such market-making activity at any time. The
offering price of the Common Stock will be established by negotiations between
the Company and the Underwriter and may not necessarily bear any direct
relationship to the price at which the Common Stock will trade after the
Offering or to the Company's assets, earnings, book value per share or other
generally accepted criteria of value. For factors to be considered in
determining the initial public offering price, see "Underwriting." The Company
has applied for the listing of its Common Stock on The Nasdaq SmallCap Market
but there can be no assurance that an active trading market will develop. See
"Risk Factors -- No Prior Public Market; No Assurance of Public Trading
Market" and "-- Potential Volatility of Stock Price."

INVESTMENT IN THE SECURITIES OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK. FOR
A DESCRIPTION OF CERTAIN RISKS REGARDING AN
INVESTMENT IN THE COMPANY, SEE "RISK FACTORS" COMMENCING ON PAGE 8.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

- ------------------------------------------------------------------------
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC COMMISSION(1)(2) COMPANY(3)
- ------------------------------------------------------------------------
Per Share......... $ $ $
- ------------------------------------------------------------------------
Total............. $ $ $
- ------------------------------------------------------------------------

(see notes on following page)

The Common Stock is being offered by the Company through the Underwriter on
a best efforts, all or none basis, when, as and if issued, subject to approval
of certain legal matters by counsel for the Underwriter and certain other
conditions, during the offering period beginning on the date of this Prospectus
and ending on [ ], 1998 (which may be extended for up to 30 days or until
[ ], 1998, with the consent of the Company and the Underwriter). The Offering
is made by the Underwriter on behalf of the Company, subject to the
Underwriter's right to reject any subscription in whole or in part or to
withdraw or cancel the Offering without notice to anyone other than the Company.
All proceeds of the Offering will be held in escrow by Colorado State Bank and
Trust, Denver, Colorado, as escrow agent, until the Offering is fully
subscribed. It is expected that delivery of the securities will be made at the
offices of the Underwriter in Denver, Colorado as promptly as practicable
following the receipt of subscriptions for and payment of the aggregate offering
price. If the Offering is not fully subscribed on or before the end of the
offering period or any extension thereof, investors who have deposited funds
into the escrow account will promptly receive a full refund, without interest or
deduction.

D. E. FREY & COMPANY, INC.
THE DATE OF THIS PROSPECTUS IS , 1998

<PAGE>
(1) Subject to completion of the Offering, the Underwriter will receive a
non-accountable expense allowance equal to three percent of the amount raised in
the Offering. The Underwriter will further receive a commission of four percent
on sales of Common Stock to persons to whom the Company has referred the
Underwriter in writing (to a maximum of fifty percent of the Offering) and eight
and one-half percent on all other sales. For purposes of this table, the Company
has assumed that the Underwriter will receive the maximum commission of eight
and one-half percent on all sales. The Company has also agreed to indemnify the
Underwriter against certain liabilities, including liabilities under the
Securities Act of 1933, as amended (the "Securities Act"). See
"Underwriting."

(2) Upon the closing of the Offering, the Company will sell to the
Underwriter and/or its designees, for an aggregate price of $100, warrants to
purchase 110,000 shares of Common Stock. The warrants will entitle the holder to
purchase the shares of Common Stock at a purchase price per share of 130% of the
public offering price and will be exercisable during the four-year period
beginning one year after issuance thereof.

(3) These amounts represent the proceeds to the Company after payment of
underwriting commissions, but before deduction of other offering expenses
estimated at $560,000.

The Company has not previously filed any reports with the Commission and
currently is not a reporting company. The Company anticipates that it will file
appropriate documentation to register the Company as a reporting company under
the Securities Exchange Act of 1934, as amended, such registration to be
effective no later than the date of consummation of the Offering, and will
furnish its stockholders with annual reports containing consolidated financial
statements, audited and reported upon by its independent certified public
accountants, after the end of each fiscal year, beginning with its fiscal year
ended December 31, 1997. The Company will also distribute quarterly reports
containing unaudited interim financial information and such other periodic
reports as the Company may determine to be appropriate or as may be required by
law.

THE COMMON STOCK IS OFFERED SUBJECT TO PRIOR SALE, ALLOTMENT, WITHDRAWAL,
CANCELLATION OR MODIFICATION OF THE OFFERING WITHOUT PRIOR NOTICE. THE
UNDERWRITER RESERVES THE RIGHT TO REJECT ANY SUBSCRIPTION IN WHOLE OR IN PART.
THE OFFERING CANNOT BE MODIFIED UNLESS AN AMENDED REGISTRATION STATEMENT IS
FILED AND DECLARED EFFECTIVE BY THE COMMISSION.

Any document that is incorporated by reference herein but not delivered
herewith may be requested by any person to whom this Prospectus is delivered.
Such requests should be made to United Oilfield Services, Inc., 615 Upper North
Broadway, Suite 950, MT-198, Corpus Christi, Texas 78477, telephone number (512)
882-3536. Delivery of the requested documents will be made without charge.

<PAGE>
PROSPECTUS SUMMARY

SIMULTANEOUSLY WITH AND AS A CONDITION TO THE CLOSING OF THE OFFERING,
UNITED OILFIELD SERVICES, INC. (THE "COMPANY") WILL ISSUE TO THE HOLDERS OF
THE OUTSTANDING EQUITY SECURITIES OF UNITED WELLHEAD SERVICES, INC.
("WELLHEAD"), FLARE KING, INC. ("FLARE KING") AND HI-TECH COMPRESSOR
COMPANY, L.C. ("HI-TECH") SHARES OF COMMON STOCK IN EXCHANGE FOR THE OWNERSHIP
INTERESTS OF SUCH HOLDERS IN SUCH COMPANIES (THE "REORGANIZATION"). WELLHEAD,
HI-TECH AND FLARE KING ARE AT TIMES REFERRED TO HEREIN INDIVIDUALLY AS A
"FOUNDING COMPANY" AND COLLECTIVELY AS THE "FOUNDING COMPANIES." UNLESS THE
CONTEXT INDICATES OTHERWISE, ALL REFERENCES TO THE "COMPANY" HEREIN INCLUDE
THE FOUNDING COMPANIES. THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY,
AND SHOULD BE READ IN CONJUNCTION WITH, THE MORE DETAILED INFORMATION AND THE
PRO FORMA COMBINED AND HISTORICAL FINANCIAL STATEMENTS, INCLUDING THE NOTES
THERETO, APPEARING ELSEWHERE IN THIS PROSPECTUS.

THE COMPANY

Upon consummation of the acquisition of the Founding Companies, the Company
will be a diversified energy service and manufacturing company that provides a
variety of services and equipment to the exploration, production and
transmission sectors of the oil and gas industry, with each Founding Company
operating its business as a separate wholly owned subsidiary of the Company. The
Founding Companies are engaged principally in the manufacture, reconditioning
and distribution of wellhead equipment for the oil and gas industry, mainly the
drilling, exploration and production segment (Wellhead), the manufacture of
flare tips and ignition systems for plant production facilities (Flare King) and
the assembly of rotary screw compressor units to enhance the production of oil
and gas wells (Hi-Tech). The Reorganization will be effected simultaneously with
and as a condition to the closing of the Offering.

WELLHEAD. The operations of Wellhead consist of the manufacture,
reconditioning, distribution, maintenance and sale of oilfield equipment and
components, principally wellhead equipment, valves, drilling spools and
manifolds. Wellhead obtains such equipment and components by acquiring and
reconditioning used items, by manufacturing items at its facilities or by
acquiring new products directly from manufacturers. Wellhead also reconditions
for a fee out-of-service equipment for various oilfield concerns and performs
onsite installations and repairs.

FLARE KING. Flare King designs, manufactures, installs and services flare
stacks and related ignition, reporting and control devices and systems to
control the onshore and offshore burning of various waste gas compounds.
Full-time experts qualified and trained in the science of gas flaring and full
manufacturing facilities permit Flare King to respond quickly to specific
customer needs both in developing appropriate flare systems and in installing
and servicing such systems. Flare King also maintains a fleet of rental flare
equipment to satisfy customer requirements during maintenance or construction or
pending permanent installation.

HI-TECH. Hi-Tech provides a broad range of natural gas compression
equipment to customers principally in Louisiana, Texas, New Mexico, Oklahoma,
Colorado and Wyoming. Hi-Tech also provides rental operations and maintenance
services to its customers. As of September 30, 1997 Hi-Tech had a fleet of nine
compression rental units with an aggregate capacity of approximately 500
horsepower. Hi-Tech's products and services are essential to the production,
transportation, processing and storage of natural gas and are provided primarily
to energy producers and processors.

OFFICES. The Company, incorporated in Texas in October 1997, maintains its
principal executive offices at 615 Upper North Broadway, Suite 950, Corpus
Christi, Texas 78477 and its telephone number is (512) 882-3536.

3
<PAGE>

THE OFFERING
<TABLE>
<CAPTION>
<S> <C>
Common stock offered by the
Company.............................. 1,100,000 shares
Common stock to be outstanding after
the Offering(1).................... 4,218,750 shares
Use of Proceeds...................... To repay a portion of the indebtedness of the Founding
Companies, to finance an expansion of the Company's sales and
marketing operations, to expand inventory, to expand the
compressor fleet, to fund research and development, for future
acquisitions and for other corporate purposes, including
working capital. See "Use of Proceeds."
</TABLE>

- ------------

(1) Includes 3,118,750 shares of common stock to be issued in connection with
the Reorganization.

RISK FACTORS

An investment in the securities offered hereby involves a high degree of
risk. Business risks, including industry conditions, competition, absence of
combined operating history, capital requirements, availability of acquisitions,
operating risks, reliance on significant customers, dependence on key personnel
and environmental, regulatory and control issues, and risks relating to the
Offering, including lack of an existing public market, potential volatility of
stock price, the offering price, lack of underwriter experience with initial
public offerings, shares eligible for future sale, dilution and measures in the
Company's charter documents with anti-takeover effect, are set forth in greater
detail beginning on page 8 of this Prospectus.

4
<PAGE>
SUMMARY PRO FORMA COMBINED FINANCIAL DATA
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

The Company will acquire the Founding Companies in the Reorganization
simultaneously with and as a condition to the closing of the Offering. For
financial statement presentation purposes, Wellhead has been deemed the
"accounting acquiror." The following table presents summary pro forma combined
financial data for the Company, as adjusted for (i) the effects of the
Reorganization, (ii) the effects of certain pro forma adjustments to the
historical financial statements described below, and (iii) the consummation of
the Offering and the application of the net proceeds therefrom. The data
presented below should be read in conjunction with the Selected Financial Data,
Management's Discussion and Analysis of Financial Condition and Results of
Operations, the historical Financial Statements of the Company and of the
individual Founding Companies and the notes thereto and the Unaudited Pro Forma
Combined Financial Statements and the notes thereto included elsewhere in this
Prospectus.

YEAR ENDED NINE MONTHS ENDED
DECEMBER 31, SEPTEMBER 30,
------------ --------------------------
1996 1996 1997
------------ ------------ ------------
STATEMENTS OF OPERATIONS DATA(1)
Revenues....................... $ 10,153 $ 6,995 $ 9,520
Gross profit................... 3,715 2,681 4,099
Selling, general and
administrative expenses...... 2,609 1,743 2,040
Depreciation and amortization
expense(2)................... 367 251 290
Income from operations......... 739 688 1,769
Interest expense............... (74) (70) (70)
Other income (expense), net.... (3) (8) (17)
Income before income tax
provision.................... 662 610 1,682
Income tax provision(3)........ (289) (226) (661)
Net income..................... 373 384 1,021
Net income per share........... 0.11 0.12 0.31
Weighted average shares
outstanding(4)............... 3,305,583 3,305,583 3,305,583

SEPTEMBER 30, 1997
--------------------------
PRO FORMA AS
COMBINED(5) ADJUSTED(6)
----------- -----------
BALANCE SHEET DATA
Cash and cash equivalents....... $ 289 $ 4,753
Working capital................. 1,877 6,548
Total assets.................... 8,531 12,830
Long-term debt, including
current maturities.............. 2,186 1,006
Stockholders' equity............ 4,274 9,753

(FOOTNOTES ON FOLLOWING PAGE)

5
<PAGE>
- ------------

(1) The pro forma combined statements of operations data assume that the
Reorganization and the Offering were closed on January 1, 1996 and are not
necessarily indicative of the results the Company would have obtained had
these events actually occurred then or of the Company's future results.

(2) Includes $146,000 for the year ended December 31, 1996 and $110,000 for the
nine months ended September 30, 1996 and 1997, respectively, of amortization
on the $2,188,000 of goodwill to be recorded as a result of the
Reorganization computed on the basis described in the notes to the Unaudited
Pro Forma Combined Financial Statements.

(3) Assumes all taxable income is subject to a corporate tax rate of 40% and all
goodwill is nondeductible.

(4) Includes (i) 3,118,750 shares to be issued in the Reorganization to holders
of ownership interests in the Founding Companies and (ii) 186,833 of the
1,100,000 shares sold in the Offering necessary to pay the expenses of this
Offering (based on an offering price of $6.00 per share).

(5) The pro forma combined balance sheet data assumes that the Reorganization
was consummated on September 30, 1997.

(6) Adjusted for the sale of 1,100,000 shares of Common Stock offered hereby and
the application of the net proceeds therefrom. See "Use of Proceeds."

6
<PAGE>
SUMMARY FOUNDING COMPANIES FINANCIAL DATA
(IN THOUSANDS)

The following table presents summary financial data for each of the
individual Founding Companies for the three most recent fiscal years ended
December 31, 1994, 1995 and 1996 and the interim periods ended September 30,
1996 and 1997.
<TABLE>
<CAPTION>

NINE MONTHS ENDED
YEAR ENDED
DECEMBER 31, SEPTEMBER 30,
------------------------------- --------------------
1994 1995 1996 1996 1997
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
WELLHEAD
Revenues........................... $ 4,043 $ 4,027 $ 8,011 $ 5,399 $ 8,052
Gross profit....................... 1,494 1,520 2,851 2,042 3,472
Income from operations............. 231 85 653 553 1,711
Net income (loss) (1).............. (194) 181 248 308 1,003
FLARE KING
Revenues........................... $ 1,268 $ 725 $ 1,034 $ 742 $ 902
Gross profit....................... 388 328 492 399 431
Income (loss) from operations...... (224) (123) 66 133 113
Net income (loss).................. (281) (110) 113 109 65
HI-TECH
Revenues........................... $ 337 $ 756 $ 1,108 $ 854 $ 566
Gross profit....................... 134 326 372 240 196
Income from operations............. 35 80 166 111 55
Pro forma net income (2)........... 22 41 106 55 29
</TABLE>

- ------------

(1) Reflects the effect in 1994 of a discount of $379 recognized on the issuance
of redeemable preferred stock because of a conversion feature.

(2) As adjusted to give effect to income taxes of $12, $22, $41, $12 and $5,
respectively, as if Hi-Tech, a limited liability company, were taxed at the
entity level rather than treated as a "pass-through" vehicle for tax
purposes.

<PAGE>
RISK FACTORS

AN INVESTMENT IN THE SHARES OF COMMON STOCK OFFERED BY THIS PROSPECTUS
INVOLVES A HIGH DEGREE OF RISK. PROSPECTIVE INVESTORS SHOULD CONSIDER CAREFULLY,
IN ADDITION TO THE OTHER INFORMATION IN THIS PROSPECTUS, THE RISK FACTORS AND
OTHER SPECIAL CONSIDERATIONS RELATING TO THE BUSINESS OF THE COMPANY AND THE
OFFERING SET FORTH BELOW.

BUSINESS RISKS

INDUSTRY CONDITIONS. Many of the Company's products are sold or leased to
industry sectors that experience significant fluctuations in demand based on
economic conditions, energy prices, consumer demand and other factors beyond the
control of the Company. The Company's operations are materially dependent upon
the levels of activity in oil and natural gas development, production,
processing and transportation. Such activity levels are affected both by
short-term and long-term trends in oil and natural gas prices. In recent years,
oil and natural gas prices, and therefore the level of drilling and exploration
activity, have been extremely volatile. Any prolonged substantial reduction in
oil and natural gas prices would, in all likelihood, depress the level of
exploration and development activity and result in a corresponding decline in
the demand for the Company's products and services. A significant prolonged
decline in oil and natural gas prices could have a material adverse effect on
the Company's business, results of operations and financial condition.

COMPETITION. The oil and gas production equipment, flare systems and
natural gas compression businesses are highly competitive. The Company competes
with several large national and multinational companies, many of which have
greater financial and other resources than the Company. There can be no
assurance that such competitors will not substantially increase the resources
devoted to the development and marketing of products and services competitive
with those of the Company or that new competitors will not enter these
industries. See "The Company -- Competition."

ABSENCE OF COMBINED OPERATING HISTORY; RISKS OF INTEGRATING
COMPANIES. Before the Offering, each of the Founding Companies has been
operating as a separate entity, although there has been some overlap in
ownership and management. As a condition to the closing of the Offering, the
equityholders of the Founding Companies have agreed to effect the
Reorganization. The management group of United Oilfield Services, Inc. has been
assembled only recently and, although the members of the management group have
previously held and will continue to hold various management positions in one or
more of the Founding Companies, there can be no assurance that they will be able
to manage the combined entity or to implement effectively the Company's
acquisition and internal growth operating strategies. The inability of the
Company to integrate the Founding Companies successfully would have a material
adverse effect on the Company's business, financial condition and results of
operations. See "The Company -- Operating Philosophy and Growth Strategies"
and "Management."

SUBSTANTIAL CAPITAL REQUIREMENTS. The Company makes, and intends to
continue to make, substantial capital investments in additional oilfield
equipment and its compressor rental fleet. Historically, the Company has
financed these investments through internally generated funds and bank debt. The
Company believes that it will have sufficient cash provided by the Offering, the
Company's operations and borrowings under the Company's existing credit
facilities with various banks to fund these capital needs. There can be no
assurance, however, that the Company will generate sufficient cash flow or have
sufficient access to external funding to continue to satisfy its capital
requirements. Failure to generate sufficient cash flow, together with the
absence of alternative sources of capital, could have a material adverse effect
on the Company's growth, results of operations and financial condition. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Combined Liquidity and Capital Resources."

AVAILABILITY AND INTEGRATION OF ACQUISITIONS. As part of its growth
strategy, the Company intends to pursue the acquisition of other companies,
assets and product lines that either complement or expand its existing business.
Each such acquisition will involve a number of potential risks, such as the
diversion of management's attention to the assimilation of the operations and
personnel of the acquired businesses and possible short-term adverse effects on
the Company's operating results during the integration process. The

8
<PAGE>
Company will also routinely conduct preliminary discussions with numerous
companies concerning possible acquisitions. The Company is unable to predict
whether or when any prospective candidate will become available or the
likelihood of a material acquisition being completed. The Company may seek to
finance any such acquisition through the issuance of new debt and/or equity
securities. If the Company proceeds with an acquisition, and if such acquisition
is relatively large and consideration is in the form of cash, a substantial
portion of the Company's financial resources could be used in order to
consummate any such acquisition. See "The Company -- Operating Philosophy and
Growth Strategies."

OPERATING RISKS AND INSURANCE. The Company's equipment and services are
provided to operations that are subject to hazards inherent in the oil and gas
industry, such as blowouts, explosions, craterings, fires and oil spills.
Litigation arising from a catastrophic occurrence at a location where the
Company's equipment and services are used may result in the Company being named
as a defendant in lawsuits asserting potentially large claims. The Company
maintains insurance coverage that it believes to be customary in the industry
against these hazards. There can, however, be no assurance that the Company will
be able to maintain adequate insurance in the future at rates it considers
reasonable or that insurance will continue to be available on terms as favorable
as the Company's existing arrangements. In addition, the insurance is subject to
coverage limits, and the occurrence of a significant event or adverse claim in
excess of the insurance coverage limits maintained by the Company or which is
not covered by insurance could have a material adverse effect on the Company's
financial condition and results of operations.

RELIANCE ON SIGNIFICANT CUSTOMERS. The Company's businesses are dependent
on securing and maintaining customers by delivering prompt, reliable and
high-quality service and reliable, high-performance products. While the Company
is not dependent on any one customer and the identity of customers of the
Company does vary from year to year, the loss of one or more significant
customers could, at least on a short-term basis, have an adverse effect on the
Company's results of operations. See "The Company -- The Wellhead Business,"
"-- The Flare Business" and "-- The Compression Business" for information as
to customer concentration.

DEPENDENCE ON KEY PERSONNEL. The success of the Company will largely be
dependent on the efforts and active participation of Alvin H. Dueitt (President
of the Company and of Wellhead) and Burnace J. Boles, Jr. (Vice President of the
Company and President of Flare King). The loss of the services of either
individual could be detrimental to the Company as there is no assurance that the
Company could replace them at affordable compensation levels. The Company has
entered into employment agreements with Mr. Dueitt and Mr. Boles, and maintains
key man life coverage with respect to Mr. Dueitt. See "Management -- Employment
Agreements."

ENVIRONMENTAL LIABILITY RISKS. As a result of its fabrication and
refurbishing operations, the Company generates or manages hazardous wastes, such
as solvents, thinner, waste paint, waste oil, washdown wastes, and sandblast
material. The Company attempts to use generally accepted operating and disposal
practices and, with respect to acquisitions, will attempt to identify and assess
whether there is any contamination before completing an acquisition. Based on
the nature of the industry, however, hydrocarbons or other wastes may have been
disposed of or released on or under properties owned, leased, or operated by the
Company or on or under other locations where such wastes have been taken for
disposal. These properties and the wastes disposed thereon may be subject to
federal or state environmental laws that could require the Company to remove the
wastes or remediate sites where they have been released. See also "Governmental
Regulation" below and "The Company -- Government Regulation."

GOVERNMENTAL REGULATION. The Company is subject to various federal, state
and local laws and regulatory standards relating to safety, health and the
environment, including regulations regarding emission controls. The Company
believes that it is in substantial compliance with such laws and regulations and
that the phasing in of emission controls and other known standards at the rate
currently contemplated by existing laws and regulations will not have a material
adverse effect on the Company's business, results of operations or financial
condition. However, various state and federal agencies from time to time
consider adopting new laws and regulations or amending existing laws and
regulations regarding environmental protection. While the Company may be able to
pass on to its customers the additional costs of complying

9
<PAGE>
with such laws, there can be no assurances that attempts to do so will be
successful. Accordingly, new laws or regulations or amendments to existing laws
or regulations could require the Company to undertake significant capital
expenditures and could otherwise have a material adverse effect on the Company's
business, results of operations and financial condition.

CONTROL BY EXISTING MANAGEMENT AND SHAREHOLDERS. Upon the completion of
the Reorganization and the Offering, the Company's executive officers and
directors, former shareholders of the Founding Companies and entities affiliated
with them will beneficially own approximately 74% of the Common Stock of the
Company. As a result, these persons, if they chose to act together, would have
sufficient voting power to significantly influence the direction and policies of
the Company and the outcome of any matter requiring stockholder approval,
including mergers, consolidations and the sale of all or substantially all of
the assets of the Company, and to prevent or cause a change in control of the
Company.

OFFERING RISKS

NO PRIOR PUBLIC MARKET; NO ASSURANCE OF PUBLIC TRADING MARKET. There has
been no public market for the Common Stock before the Offering. Although the
Company has applied for listing on The Nasdaq SmallCap Market, there can be no
assurance that the Common Stock will be approved for listing, that an active
trading market will develop subsequent to the Offering, that, if developed, it
will be sustained or that the Company will be able to maintain the standards
that must be met to avoid having the shares delisted. The Underwriter has
indicated that it intends to make a market in the Common Stock upon completion
of this Offering, but there can be no assurance that the Underwriter will
continue to do so indefinitely.

POTENTIAL VOLATILITY OF STOCK PRICE. Prices for the Common Stock after the
Offering may be subject to significant fluctuation in response to numerous
factors, including variations in the annual or quarterly financial results of
the Company or its competitors, the liquidity of the market for the Common
Stock, investor perceptions of the Company and the energy services industry and
general economic and other conditions. In addition, the stock market has from
time to time experienced extreme price and volume fluctuations that have
affected the market price for many companies in a manner often unrelated to the
operating performance of such companies.

DETERMINATION OF OFFERING PRICE; BEST EFFORTS UNDERWRITING. The initial
public offering price of the Common Stock will be determined through
negotiations between the Company and the Underwriter and may bear no
relationship to the price at which the Common Stock will trade after the
Offering. For information relating to the factors to be considered in
determining the initial public offering price, see "Underwriting." There is no
commitment on the part of the Underwriter or any person to purchase any of the
shares offered hereby. The shares are being offered on a best efforts, all or
none basis.

UNDERWRITER'S LACK OF EXPERIENCE WITH INITIAL PUBLIC OFFERINGS. Although
the Underwriter offers a broad range of investment and financial services and
has acted as a member of the underwriting group in connection with several
public offerings, the Offering is the first initial public offering undertaken
by the Underwriter individually on behalf of an issuer. Moreover, although the
Underwriter has a trading department and has served as a market maker of equity
securities, with respect to which it has maintained up to twelve trading
positions at any given time, it has limited experience in aftermarket trading or
support of initial public offerings. No assurance can therefore be given that
the Underwriter can successfully complete the Offering or that the Underwriter
will, upon successful completion of the Offering, be able to support the
aftermarket.

SHARES ELIGIBLE FOR FUTURE SALE. Sales of substantial amounts of Common
Stock in the public market subsequent to the Offering could adversely affect the
market price of the Common Stock. Upon consummation of the Offering, the Company
will have 4,218,750 shares of Common Stock outstanding. Of these shares, the
shares of Common Stock issued pursuant to the Offering will be freely tradable
without restriction or further registration under the Securities Act, except for
shares held by persons deemed to be "affiliates" of the Company or acting as
"underwriters" as those terms are defined in the Securities Act. The remaining
3,118,750 shares of Common Stock outstanding will have been issued in the
Reorganization without registration under the Securities Act. They will be
"restricted securities" within the meaning of

10
<PAGE>

Rule 144 under the Securities Act and will be eligible for resale subject to the
volume, manner of sale, holding period and other limitations of Rule 144. In
addition, warrants to purchase 110,000 shares of Common Stock will be issued to
the Underwriter if the Offering is successfully completed and will be
exercisable for a four-year period beginning one year after the issuance
thereof. The executive officers and directors of the Company and certain other
stockholders have agreed not to sell any shares of Common Stock without the
consent of the Underwriter for a period of one year from the date of the closing
of the Offering. See "Shares Eligible for Future Sale" and "Underwriting."

DIVIDENDS. The Company is a newly organized corporation that has never
paid cash dividends on its Common Stock and does not anticipate paying any such
cash dividends in the foreseeable future. In addition, the Founding Companies'
existing lines of credit include restrictions on their ability to pay dividends
without the consent of the lenders and, if the Company is successful in
obtaining one or more new lines of credit, it is likely that any such facility
will include restrictions on the ability of the Company to pay dividends without
the consent of the lender. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Combined Liquidity and Capital
Resources."

DILUTION. Shares of Common Stock purchased by investors participating in
the Offering will incur immediate substantial dilution from the offering price
as compared to the book value of such shares. Thus, investors participating in
the Offering will bear the greatest risk of loss considered on the basis of
initial investment. To the extent outstanding options and warrants to purchase
the Company's Common Stock are exercised, there may be further dilution. See
"Dilution."

POTENTIAL ANTI-TAKEOVER EFFECT OF PROVISIONS IN CHARTER DOCUMENTS. The
Company's Articles of Incorporation and Bylaws (the "Charter Documents")
contain provisions that may make it more difficult for a third party to acquire,
or may discourage acquisition bids for, the Company. The Board of Directors of
the Company is authorized, without action of its stockholders, to issue
authorized but unissued common and preferred stock. The existence of
undesignated preferred stock and authorized but unissued common stock enables
the Company to make more difficult or to discourage an attempt to obtain control
of the Company by means of a merger, tender offer, proxy contest or otherwise.
The Charter Documents provide further that (i) directors be elected for
three-year terms, with approximately one-third of the Board of Directors
standing for election each year, (ii) to alter or repeal the staggered board
provision or other measures in the Charter Documents relating to the matters
listed in this paragraph, the affirmative vote of the holders of not less than
80% of the votes entitled to be cast by the holders of all stock entitled to
vote in the election of directors is required, (iii) the unanimous vote of the
Board of Directors or the affirmative vote of the holders of not less than 80%
of the votes entitled to be cast by the holders of all stock entitled to vote in
the election of directors is required to change the size of the Board of
Directors, (iv) directors may only be removed for cause by holders of not less
than 80% of the Common Stock, (v) a stockholder must notify the Company at least
that number of days in advance of the meeting at which such holder intends to
bring up items of business or nominate directors at any annual meeting of
stockholders as may be required under federal securities laws for companies with
a class of stock registered under the Securities Exchange Act of 1934, as
amended, (vi) a special meeting of stockholders may be called by stockholders
only if at least 25% of the stockholders of the Company request that a special
meeting be called, (vii) any action required or permitted to be taken by
stockholders of the Company must be effected at a duly called annual or special
meeting of such stockholders and may not be effected by consent in writing by
such stockholders and (viii) the affirmative vote of the holders of 66 2/3% of
the Company's capital stock entitled to vote thereon is required to approve the
merger, dissolution or sale of all or substantially all of the assets of the
Company.

11
<PAGE>

SELECTED FINANCIAL DATA
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

The Company will acquire the Founding Companies in the Reorganization
simultaneously with and as a condition to the closing of the Offering. For
financial statement presentation purposes, however, Wellhead has been identified
as the "accounting acquiror." The following selected historical financial
information of Wellhead has been derived from the audited consolidated financial
statements of Wellhead for each year in the three-year period ended December 31,
1996. The remaining selected historical financial information of Wellhead has
been derived from unaudited financial statements of Wellhead, which have been
prepared on the same basis as the audited financial statements and, in the
opinion of Wellhead, reflect all adjustments, consisting of normal recurring
adjustments, necessary for a fair presentation of that information. The
following table presents selected unaudited pro forma combined financial data
for the Company, as adjusted for (i) the effects of the Reorganization, (ii) the
effects of certain pro forma adjustments to the historical financial statements
described below, and (iii) the consummation of the Offering and the application
of the net proceeds therefrom. The data presented below should be read in
conjunction with Management's Discussion and Analysis of Financial Condition and
Results of Operations, the historical Financial Statements of the Company and
the individual Founding Companies and the notes thereto and the Unaudited Pro
Forma Combined Financial Statements and the notes thereto included elsewhere in
this Prospectus.

STATEMENTS OF OPERATIONS DATA

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEARS ENDED DECEMBER 31, SEPTEMBER 30,
----------------------------------------------------- --------------------
1992 1993 1994 1995 1996 1996 1997
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
WELLHEAD--HISTORICAL
Revenues........................... $ 1,211 $ 1,729 $ 4,043 $ 4,027 $ 8,011 $ 5,399 $ 8,052
Gross profit....................... 618 827 1,494 1,520 2,851 2,042 3,472
Selling, general and administrative
expenses......................... 411 507 1,201 1,336 2,082 1,407 1,666
Depreciation and amortization
expenses......................... 24 28 62 99 116 82 95
Income from operations............. 183 292 231 85 653 553 1,711
Interest expense................... 20 18 36 39 36 28 36
Other income (expense), net........ (2) (7) (42) 11 (54) 2 (20)
Income before income tax benefit
(provision)...................... 161 267 153 57 563 527 1,655
Income tax benefit (provision)..... 32 172 (257) (179) (616)
Net income before preferred stock
dividends and preferred stock
discount......................... 161 267 185 229 306 348 1,039
Preferred stock dividends.......... 48 58 40 36
Preferred stock discount........... 379
Net income (loss).................. 161 287 (194) 181 248 308 1,003
</TABLE>
12
<PAGE>

PRO FORMA COMBINED(1)
<TABLE>
NINE MONTHS ENDED
SEPTEMBER 30,
DECEMBER 31, ------------------------
1996 1996 1997
------------ ----------- -----------
<S> <C> <C> <C>
Revenues............................................................................ $ 10,153 $ 6,995 $ 9,520
Gross profit................................................................... 3,715 2,681 4,099
Selling, general and administrative expenses................................... 2,609 1,743 2,040
Depreciation and amortization expense(2)....................................... 367 251 290
Income from operations......................................................... 739 688 1,769
Interest expense............................................................... (74) (70) (70)
Other income (expense), net.................................................... (3) (8) (17)
Income before income tax provision............................................. 662 610 1,682
Income tax provision(3)........................................................ (289) (226) (661)
Net income..................................................................... 373 384 1,021
Net income per share........................................................... 0.11 0.12 0.31
Weighted average shares outstanding(4)......................................... 3,305,583 3,305,583 3,305,583
</TABLE>

BALANCE SHEET DATA

<TABLE>
<CAPTION>
COMBINED COMPANIES
WELLHEAD --------------------------
-----------------------------------------------------------
SEPTEMBER 30, 1997
DECEMBER 31, --------------------------
------------------------------------------ SEPTEMBER 30, PRO FORMA AS
1992 1993 1994 1995 1996 1997 COMBINED(5) ADJUSTED(6)
---- ---- ------ ------ ------ ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Cash and cash equivalents........... $ 25 $ 36 $ 36 $ 23 $ 369 $ 264 $ 289 $ 4,753
Working capital..................... 168 392 616 727 1,244 1,735 1,877 6,548
Total assets........................ 560 845 2,226 2,315 3,898 4,906 8,531 12,830
Long-term debt, including current
maturities........................ 121 181 464 375 620 1,352 2,186 1,006
Stockholders' equity................ 185 396 1,134 1,315 1,563 1,606 4,274 9,753
</TABLE>

- ------------

(1) The pro forma combined statements of operations data assume that the
Reorganization and the Offering were closed on January 1, 1996 and are not
necessarily indicative of the results of the Company would have obtained had
these events actually occurred then or of the Company's future results.

(3) Assumes all taxable income is subject to a corporate tax rate of 40% and all
goodwill is nondeductible.

(5) The pro forma combined balance sheet data assumes that the Reorganization
was consummated on September 30, 1997.

(6) Adjusted for the sale of 1,100,000 shares of Common Stock offered hereby and
the application of the net proceeds therefrom. See "Use of Proceeds."

<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the Selected
Pro Forma Combined Financial Data, the Unaudited Pro Forma Combined Financial
Statements, and the historical Financial Statements of the Company and the
individual Founding Companies and related notes thereto appearing elsewhere in
this Prospectus.

INTRODUCTION

The Company was formed to combine the operations of the Founding Companies,
which provide products and services to the energy industry. The Founding
Companies are engaged in: (1) the manufacture, reconditioning and distribution
of wellhead equipment for the oil and gas industry, mainly the drilling,
exploration and production segments, (2) the manufacturing of flare tips and
ignition systems for plant and production facilities, and (3) the assembling of
rotary screw compressor units to enhance the production of oil and gas wells.

INCOME TAX BENEFIT

The Founding Companies account for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 "Accounting for Income
Taxes." Wellhead, as of September 30, 1997, has an operating loss carryforward
of approximately $544,000 for federal income taxes available to offset future
income, expiring, if not used, at varying dates through the year 2009. The net
operating loss carryforward was acquired in the acquisition of WRI, Inc. and is
subject to an annual limitation of approximately $74,000. Flare King has a
capital loss carryforward of approximately $6,300.

SEASONALITY AND ECONOMIC CONDITIONS

The Company's sales are affected by the timing of planned drilling,
development and construction by its energy industry customers. The fourth
quarter is generally favorably affected.

INFLATION

Management does not believe that inflation has had a material impact upon
the results of operations during the years ended December 31, 1994, 1995, 1996,
and the nine months ended September 30, 1997.

COMBINED RESULTS OF OPERATIONS

INTRODUCTION. The financial data (dollar amounts in thousands) set forth
below for the year ended December 31, 1996 and the nine months ended September
30, 1996 and 1997 are derived from the Unaudited Pro Forma Combined Statements
of Operations of United Oilfield Services, Inc. included elsewhere herein. The
data set forth below for the years ended December 31, 1994 and 1995 were
prepared on a consistent basis with such later periods and were derived from the
historical statements of the individual Founding Companies. Combined income from
operations excludes other income and expenses, interest expense and income
taxes.
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEARS ENDED DECEMBER 31, SEPTEMBER 30,
---------------------------------------------------------------- --------------------
1994 1995 1996 1996
-------------------- -------------------- -------------------- --------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues................................ $ 5,648 100.0% $ 5,508 100.0% $ 10,153 100.0% $ 6,995 100.0%
Cost of goods sold.................. 3,631 64.3% 3,334 60.5% 6,438 63.4% 4,314 61.7%
--------- --------- --------- ---------
Gross profit.................... 2,017 35.7% 2,174 39.5% 3,715 36.6% 2,681 38.3%
Selling, general and administrative
expenses.............................. 1,813 32.1% 1,892 34.4% 2,609 25.7% 1,743 24.9%
Depreciation and amortization
expenses.............................. 161 2.9% 240 4.4% 367 3.6% 141 3.6%
--------- --------- --------- ---------
Income from operations.............. $ 43 0.8% $ 42 0.8% $ 739 7.3% $ 797 9.8%
========= ========= ========= =========
</TABLE>
1997
--------------------
Revenues................................ $ 9,520 100.0%
Cost of goods sold.................. 5,421 56.9%
---------
Gross profit.................... 4,099 43.1%
Selling, general and administrative
expenses.............................. 2,040 21.4%
Depreciation and amortization
expenses.............................. 180 3.0%
---------
Income from operations.............. $ 1,879 18.6%
=========

NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO NINE MONTHS ENDED
SEPTEMBER 30, 1996. Total sales increased $2,525,000 or 36.1% from $6,995,000
in the nine months ended September 30, 1996 to $9,520,000 in the nine months
ended September 30, 1997. Operating income increased $1,082,000 or 135.8% from
$797,000 to $1,879,000 for the same periods. These increases resulted primarily
from improved market conditions. This improvement in market conditions resulted
principally

14
<PAGE>

from an increase in exploration and production activity, which increased the
demand for wellhead equipment and gas compressors. Stricter enforcement of clean
air regulations, which has a direct effect on the demand for flare stacks, also
contributed to the increase.

Cost of goods sold consists of cost associated with manufacturing materials
and components, labor, quality control, subcontracting, installation, and
shipping of the Company's products. Cost of goods sold increased $1,107,000 or
25.7% from $4,314,000 for the nine months ended September 30, 1996 to $5,421,000
for the same period in 1997. Cost of goods sold as a percentage of sales
decreased 4.8% with respect to the same periods. This favorable percentage
decrease resulted from price increases in products sold by the Company.

Selling, general and administrative expense increased 17.0% from $1,743,000
for the nine months ended September 30, 1996 to $2,040,000 for the same period
in 1997, but declined 3.5% as a percentage of sales. The increase was a result
of additional cost to support increased sales.

Depreciation and amortization expense increased $39,000 or 27.7% from
$141,000 for the nine months ended September 30, 1996 to $180,000 for the same
period in 1997. The increase resulted from a continuing expansion in the gas
compressor rental fleet and other capital expenditures.

YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31,
1995. Total sales increased $4,645,000 or 84.3% from $5,508,000 for the year
ended December 31, 1995 to $10,153,000 for the year ended December 31, 1996 and,
with respect to the same periods, operating income increased $843,000 from
$42,000 to $885,000. These increases resulted principally from improved market
conditions, and to a lesser extent from the opening of a wellhead facility in
Shreveport, Louisiana which accounted for an additional $1,363,000 in sales for
the period.

Cost of goods sold increased $3,104,000 or 93.1% from $3,334,000 for the
year ended December 31, 1995 to $6,438,000 for the year ended December 31, 1996.
This increase is the result of additional costs to support an increase in sales.

Selling, general and administrative expenses increased $718,000 or 37.9%
from $1,892,000 for the year ended December 31, 1995 to $2,609,000 for the year
ended December 31, 1996. This increase was necessary to support increased sales
activity.

Depreciation and amortization expense decreased $19,000 or 8.3% from
$240,000 for the year ended December 31, 1995 to $221,000 for the year ended
December 31, 1996. This decrease is primarily the result of certain assets
becoming fully depreciated and that did not require replacement.

YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31,
1994. Total sales decreased $140,000 or 2.5% from $5,648,000 for the year ended
December 31, 1994 to $5,508,000 for the year ended December 31, 1995. This
decrease resulted principally from the fact that the industry, as a whole,
experienced minimal growth.

Cost of goods sold decreased $297,000 or 8.9% from $3,631,000 for the year
ended December 31, 1994 to $3,334,000 for the year ended December 31, 1995. This
was the result primarily of changes in managerial and cost control procedures in
the newly acquired branches of Wellhead. A general decrease in sales activity
also contributed to such decrease.

Selling, general and administrative expense increased $79,000 or 4.2% from
$1,813,000 for the year ended December 31, 1994 to $1,892,000 for the year ended
December 31, 1995. This increase was the result of a full year of certain
administrative costs connected with the acquisition and integration of four new
locations added to Wellhead.

Depreciation and amortization expense increased $79,000 or 49.0% from
$161,000 for the year ended December 31, 1994 to $240,000 for the year ended
December 31, 1995. The increase resulted primarily from the acquisition of WRI,
Inc. in June 1994.

COMBINED LIQUIDITY AND CAPITAL RESOURCES

The Founding Companies have funded their operations and capital
expenditures mainly through cash flows generated from operations and bank debt.
On a combined basis, the Founding Companies generated $414,000 of net cash flow
from operating activities during 1996. At December 31, 1996, the combined

15
<PAGE>

Founding Companies had cash of $369,000, working capital of $1,245,000, and
total long-term debt of $1,269,000, of which $292,000 was classified as current.
On a pro forma basis, after giving effect to the Reorganization, the Company and
the Founding Companies would have had, on a combined basis, a cash balance of
approximately $289,000, working capital of approximately $1,877,000 and total
debt of approximately $2,198,000, $514,000 of which would be classified as
current. Certain debts of the Founding Companies have from time to time been
guaranteed by officers and significant shareholders thereof. See "Certain
Transactions -- Existing Matters." As these debts mature and are paid or
refinanced, the Company does not anticipate that such guarantees will be
extended or renewed or that new guarantees will be executed.

The Company intends to actively pursue acquisitions, although the Company
is not currently involved in negotiations with respect to, and has no agreement
or understanding regarding, any future acquisitions. The Company expects to fund
future acquisitions through borrowings (the Company at September 30, 1997 had a
total unused bank line of credit of approximately $765,000), cash flow from
operations and the issuance of common stock or other equity or debt securities
of the Company. Capital expenditures for equipment and expansion of facilities
will be funded from cash flow from operations and will be supplemented to the
extent necessary by borrowings. To the extent the Company funds a significant
portion of the consideration for future acquisitions with cash, it may have to
increase the credit facilities currently available to it or obtain other sources
of financing. The Company believes that the revenues generated by its operations
will be adequate to meet the Company's normal working capital and debt service
requirements for the foreseeable future.

WELLHEAD RESULTS OF OPERATIONS

INTRODUCTION. Wellhead, headquartered in Corpus Christi, Texas, was
founded in 1990 and maintains facilities in Corpus Christi (Robstown), Houston
and Midland, Texas and Lafayette and Shreveport, Louisiana. The following table
sets forth selected statement of operations data and such data as a percentage
of total revenue for the periods indicated.
<TABLE>
<CAPTION>
NINE MONTHS ENDED
FISCAL YEAR ENDED DECEMBER 31, SEPTEMBER 30,
---------------------------------------------------------------- --------------------
1994 1995 1996 1996
-------------------- -------------------- -------------------- --------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues................................ $ 4,043 100.0% $ 4,027 100.0% $ 8,011 100.0% $ 5,399 100.0%
Cost of goods sold...................... 2,549 63.0% 2,507 62.3% 5,160 64.4% 3,357 62.2%
--------- --------- --------- ---------
Gross profit............................ 1,494 37.0% 1,520 37.7% 2,851 35.6% 2,042 37.8%
Selling, general and administrative
expenses.............................. 1,201 29.7% 1,336 33.2% 2,082 26.0% 1,407 26.1%
Depreciation and amortizations
expenses.............................. 62 1.5% 99 2.5% 116 1.4% 82 1.5%
--------- --------- --------- ---------
Income from operations.................. $ 231 5.7% $ 85 2.1% $ 653 8.2% $ 553 10.2%
========= ========= ========= =========
</TABLE>
1997
--------------------
Revenues................................ $ 8,052 100.0%
Cost of goods sold...................... 4,580 56.9%
---------
Gross profit............................ 3,472 43.1%
Selling, general and administrative
expenses.............................. 1,666 20.7%
Depreciation and amortizations
expenses.............................. 95 1.2%
---------
Income from operations.................. $ 1,711 21.2%
=========

NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO NINE MONTHS ENDED
SEPTEMBER 30, 1996.__Total sales increased $2,653,000 or 49.1% from $5,399,000
in the nine months ended September 30, 1996 to $8,052,000 for the same period in
1997. Operating income increased $1,158,000 or 209.4% from $553,000 to
$1,711,000 for the same period. These increases resulted primarily from improved
market conditions. This improvement in market conditions resulted principally
from an increase in exploration and production activity, which increased the
demand for wellhead equipment.

Cost of goods sold consists of cost associated with manufacturing materials
and components, labor, quality control, subcontracting, installation, and
shipping of Wellhead's products. Cost of goods sold increased $1,223,000 or
36.4% from $3,357,000 for the nine months ended September 30, 1996 to $4,580,000
for the same period in 1997. The increase resulted from the higher level of
sales.

Selling, general and administrative expense increased 18.4% from $1,407,000
for the nine months ended September 30, 1996 to $1,666,000 for the same period
in 1997. This is a result of additional cost to support increased sales and, to
a lesser degree, an increase in profit-based incentive compensation payable to
employees and officers.

Depreciation and amortization expense increased $13,000 or 15.9% from
$82,000 for the nine months ended September 30, 1996 to $95,000 for the same
period in 1997. The increase resulted from the acquisition of additional
equipment and facilities needed to support the growth in sales.

16
<PAGE>

YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31,
1995.__Total sales increased $3,984,000 or 98.9% from $4,027,000 for the year
ended December 31, 1995 to $8,011,000 for the year ended December 31, 1996 and,
with respect to the same periods, operating income increased $568,000 from
$85,000 to $653,000. These increases resulted principally from improved market
conditions, and to a lesser extent from the opening of a wellhead facility in
Shreveport, Louisiana which resulted in an additional $1,363,000 in sales.

Cost of goods sold increased $2,653,000 or 105.8% from $2,507,000 for the
year ended December 31, 1995 to $5,160,000 for the year ended December 31, 1996.
This increase is largely the result of additional costs to support an increased
level of sales.

Selling, general and administrative expenses increased $744,000 or 55.8%
from $1,336,000 for the year ended December 31, 1995 to $2,082,000 for the year
ended December 31, 1996. This increase was necessary to support increased sales
activity and, to a lesser degree, an incentive program to compensate employees
and officers for increased profitability.

Depreciation and amortization expense increased $17,000 or 17.2% from
$99,000 for the year ended December 31, 1995 to $116,000 for the year ended
December 31, 1996. The increase resulted from the acquisition of additional
equipment and facilities needed to support the growth in sales.

YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31,
1994.__Total sales decreased $16,000 or 0.4% from $4,043,000 for the year ended
December 31, 1994 to $4,027,000 for the year ended December 31, 1995. This
decrease principally reflected the lack of growth in the industry, as a whole.

Cost of goods sold decreased $42,000 or 1.6% from $2,549,000 for the year
ended December 31, 1994 to $2,507,000 for the year ended December 31, 1995. This
was primarily the result of a general decrease in sales activity.

Selling, general and administrative expense increased $137,000 or 11.2%
from $1,201,000 for the year ended December 31, 1994 to $1,336,000 for the year
ended December 31, 1995. This increase was the result of a full year of certain
administrative costs incurred to support the integration of WRI, Inc. into
Wellhead following its acquisition.

Depreciation and amortization expense increased $37,000 or 59.7% from
$62,000 for the year ended December 31, 1994 to $99,000 for the year ended
December 31, 1995. The increase resulted primarily from the acquisition of WRI,
Inc. in June 1994.

WELLHEAD LIQUIDITY AND CAPITAL RESOURCES

Wellhead has funded their operations mainly through cash flows generated
from operations. Wellhead generated $414,000 of net cash flow from operating
activities during 1996. At December 31, 1996, Wellhead had cash of $369,000,
working capital of $1,245,000, and total long-term debt of $1,269,000, of which
$292,000 was classified as current. Wellhead generated $497,000 of net cash flow
from operating activities for the nine months ended September 30, 1997. At
September 30, 1997, Wellhead had cash of $264,000, working capital of $1,735,000
and total long-term debt of $1,353,000 of which $376,000 was classified as
current. Wellhead believes that revenues generated by its operations will be
adequate to meet Wellhead's normal working capital and debt service requirements
for the foreseeable future.

YEAR 2000 ISSUES

The Company is evaluating the potential impact of the nearly universal
practice in the computer industry of using two digits rather than four to
designate the calendar year, leading to incorrect results when computer software
performs arithmetic operations, comparisons or date field sorting involving
years later than 1999. Management believes that in light of the limited nature
of the computer software used by the Company and the limited scope of its
electronic interaction with other entities, issues relating to modification or
replacement of existing systems will not have a material effect on the
operations or financial condition of the Company. Although the Company is not
aware of any circumstances in which the failure of a supplier or customer to
deal successfully with such issues would have a material impact, there can be no
assurance that such will be the case.

17
<PAGE>
USE OF PROCEEDS

The net proceeds to the Company from the sale of the 1,100,000 shares of
Common Stock offered hereby, after deducting underwriting commissions and
estimated expenses of the Offering, are estimated to be $5.5 million, assuming
an offering price of $6.00 per share. From the net proceeds, as set forth below
in tabular format and in order of priority of use, the Company intends first to
repay in full the principal and accrued interest with respect to a promissory
note in the principal amount of $960,000, executed by Wellhead in favor of Gay
A. Roane and due in full on or before January 1, 2003. See notes to Financial
Statements of Wellhead. The principal amount bears interest at the rate of eight
percent per annum. The Company next intends to retire current indebtedness in
the outstanding amounts of approximately $120,000 and $100,000 under a $150,000
Commercial Revolving Note due June 19, 2000 and $125,000 Commercial Draw Note
due June 19, 1998, respectively, each dated June 19, 1997, made by Flare King in
favor of Midland American Bank, Midland, Texas. As an accommodation to Flare
King, Wallace C. Sparkman, formerly an executive officer and a significant
shareholder of Flare King, acted as co-maker in both instances. These
obligations accrue interest at an annual rate of 2.75% over the prime rate
published in THE WALL STREET JOURNAL (8.5% at December 31, 1997). It is
anticipated that approximately $200,000 of the remaining net proceeds will be
used to finance an expansion of the Company's sales and marketing activities,
approximately $750,000 will be used to expand inventory, approximately $500,000
will be used to expand the compressor fleet and approximately $50,000 will be
used to fund research and development with respect to flare systems and
compression units. Although the Company is not currently involved in
negotiations with respect to, and has no agreement or understanding regarding,
any future acquisitions, the Company intends to use approximately $2,000,000 to
fund the cash portion of future acquisitions, which the Company anticipates will
be in the oil and gas services industry. The remainder will be used for working
capital and other general corporate purposes.

The following table sets forth in tabular format and in order of priority
of use the amount in dollars and, as a percentage of total net offering
proceeds, each intended use of the proceeds.

PERCENTAGE OF
USE DOLLAR AMOUNT TOTAL PROCEEDS
- ------------------------------------- ------------- --------------
Payment of Roane note................ $ 960,000 17.5%
Payment of Midland American Bank
notes.............................. 220,000 4.0%
Expansion of sales and marketing
activities......................... 200,000 3.6%
Expansion of inventory............... 750,000 13.6%
Compression fleet capital
expenditures....................... 500,000 9.1%
Research and development for flare
systems and compression units...... 50,000 0.9%
Future acquisitions.................. 2,000,000 36.4%
Working capital and general corporate
purposes........................... 820,000 14.9%
------------- --------------
Total................................ $ 5,500,000 100.0%

No specific amounts for such working capital and general corporate purposes
have been allocated and the Company reserves the right to change the allocations
set forth above or to allocate funds received in the Offering for other purposes
upon determination by the Board of Directors of the Company that such
reallocation would be in the best interest of the Company. Pending such uses,
the net proceeds will be invested in investment-grade, short-term,
interest-bearing instruments.

18
<PAGE>
CAPITALIZATION

The following table sets forth the current maturities of long-term
obligations and capitalization as of September 30, 1997 (i) of the Company on a
pro forma combined basis giving effect to the Reorganization, and (ii) of the
Company on such a pro forma combined basis, as adjusted to give effect to the
Offering and the application of a portion of the estimated net proceeds
therefrom as described in "Use of Proceeds." This table should be read in
conjunction with the Unaudited Pro Forma Combined Financial Statements of the
Company and the notes thereto and the historical Financial Statements of the
Company and the individual Founding Companies and the notes thereto included
elsewhere in this Prospectus.

SEPTEMBER 30, 1997
----------------------------
PRO FORMA
PRO FORMA COMBINED,
COMBINED AS ADJUSTED
---------- --------------
(IN THOUSANDS)
Current maturities of long-term
debt(1).............................. $ 856 $ 649
========== ==============
Long-term obligations, less current
maturities(1)........................ $1,330 $ 357
Preferred stock, $0.01 par value,
5,000,000 shares authorized, none
issued.............................
Common stock, $0.01 par value,
25,000,000 shares authorized,
3,118,750 shares and 4,218,750
shares issued and outstanding,
respectively....................... 31 42
Additional paid-in capital........... 3,123 8,591
Retained earnings.................... 1,120 1,120
---------- --------------
Total stockholders' equity...... 4,274 9,753
---------- --------------
Total capitalization....... $5,604 $ 10,110
========== ==============

- ------------

(1) For a description of the Company's long-term debt, see notes to Unaudited
Pro Forma Combined Financial Statements and notes to the historical
Financial Statements of the individual Founding Companies included elsewhere
herein.

19
<PAGE>
DIVIDEND POLICY

The Company is a newly organized corporation that has never paid dividends
on its Common Stock. The Company intends to retain all of its future earnings,
if any, to finance the expansion of its business and for general corporate
purposes, including future acquisitions, and does not anticipate paying any
dividends on its Common Stock in the foreseeable future. The payment of
dividends in the future will depend upon the Company's earning levels, capital
requirements, financial condition, credit and loan agreements and other factors
deemed relevant by the Board of Directors. Certain subsidiaries of the Company
are restricted under existing credit and loan agreements from paying dividends.

DILUTION

The pro forma combined net tangible book value of the Company at September
30, 1997 was approximately $1.8 million or $0.57 per share of Common Stock. Net
tangible book value per share before the Offering represents the amount of the
Company's stockholders' equity, less intangible assets, divided by 3,118,750
shares of Common Stock, the number of shares to be issued in the Reorganization.
Net tangible book value dilution per share represents the difference between the
amount per share paid by purchasers of shares of Common Stock in the Offering
and the pro forma net tangible book value per share of Common Stock immediately
after completion of the Offering.

After giving effect to the sale in the Offering of 1,100,000 shares of
Common Stock, the deduction of underwriting commissions and estimated expenses
of the Offering and the receipt and application of the estimated net proceeds
therefrom of $5.5 million, the pro forma combined net tangible book value of the
Company at September 30, 1997 would have been approximately $7.3 million or
$1.72 per share. This represents an immediate increase in pro forma combined net
tangible book value of $1.15 per share to existing stockholders and an immediate
dilution in pro forma combined net tangible book value of $4.28 per share to
purchasers of Common Stock in the Offering. The following table illustrates this
pro forma dilution:

Assumed initial public offering price
per share............................ $ 6.00
Pro forma combined net tangible
book value per share before the
Offering....................... $ 0.57
Increase in pro forma combined
net tangible book value per
share attributable to new
investors...................... 1.15
---------
Pro forma combined net tangible book
value per share after the
Offering........................... 1.72
---------
Dilution per share to new
investors.......................... $ 4.28
=========
Dilution as a percentage of the
assumed initial public offering
price.............................. 71%
=========

The following table sets forth, on a pro forma combined basis to give
effect to the Reorganization at September 30, 1997, the number of shares of
Common Stock purchased from the Company, the total consideration paid and the
average price per share paid by existing stockholders and the new investors
purchasing shares of Common Stock from the Company in the Offering, before
deducting underwriting commissions and estimated Offering and Reorganization
expenses:
<TABLE>
<CAPTION>
SHARES PURCHASED CONSIDERATION
--------------------- ------------------------- AVERAGE PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
----------- ------- -------------- ------- -------------
<S> <C> <C> <C> <C> <C>
Existing stockholders................ 3,118,750 73.9 $ 4,274,000(1) 39.3 $1.37
New investors........................ 1,100,000 26.1 6,600,000 60.7 $6.00
----------- ------- -------------- -------
Total........................... 4,218,750 100.0 $ 10,874,000 100.0
=========== ======= ============== =======
</TABLE>

- ------------

(1) Total consideration paid by existing stockholders represents the combined
stockholders' equity of the Company and the Founding Companies after the
Reorganization, but before the Offering.

20
<PAGE>
THE COMPANY

THE INDUSTRY

Based on its operating familiarity with the industry, management believes
that several large, well capitalized companies account for the majority of the
market. A large number of small privately held companies operating in a single
or limited number of locations make up the remainder of the market. The Company
believes there is a significant opportunity for a well capitalized regional
company to provide remanufacturing of used equipment to the industry together
with new systems and equipment. The fragmented nature of the industry,
particularly of the remanufacturing aspect, should provide the Company with
significant opportunities to expand both through internally generated growth and
acquisitions.

The Company believes that the fundamental force driving the demand for
equipment used in the oil and gas specialty service industry, including the
products and services offered by the Company, is the growing consumption of
natural gas. As more gas is consumed, the demand for such products and services
increases. Demand for such equipment and services is thus expected to continue
to rise as a result of (i) the increasing demand for energy, both domestically
and abroad; (ii) environmental considerations which provide strong incentives to
use natural gas in place of other carbon fuels; (iii) implementation of
international environmental and conservation laws for conservation of natural
gas; (iv) the aging of producing natural gas reserves worldwide; and (v) the
extensive supply of as yet undeveloped natural gas reserves. As producing
natural gas reserves are depleted, demand for remanufacture of wellhead
equipment and for gas compression facilities increases. Development of as yet
undeveloped natural gas reserves adds to the supply of used wellhead equipment
as such reserves are produced and maintains if not increases demand for gas
compression facilities. The Company believes that it is especially well
positioned through its remanufacturing, gas compression and flare system
activities to take advantage of the aging of reserves and the development of new
reserves.

The products and services required by the oil and gas specialty service
industry typically must be highly engineered to meet demanding and unique
customer specifications. The fundamental nature of such products and services
has, however, been stable and not subject to rapid technological change. It is
often therefore more efficient and less costly to remanufacture existing
equipment.

THE BUSINESS

Simultaneously with the closing of the Offering, the Company will cause the
Reorganization to be effected, pursuant to which the Founding Companies will be
acquired, thereby creating a regional company providing a range of specialty
energy industry services and products. The Reorganization is being effected
primarily in response to increased demand in the natural gas exploration,
production, processing, transmission and user markets. The Company is involved
in the sale and service of (i) remanufactured wellhead equipment and other
specialized production equipment, (ii) natural gas flare stacks and ignition
systems and (iii) natural gas compressors. Wellhead has manufacturing facilities
located in Houston, Midland and Robstown, Texas and Shreveport and Lafayette,
Louisiana, where it remanufactures and services used oilfield wellhead equipment
and other specialized production equipment. Flare King has a manufacturing
facility located in Midland, Texas, where it designs and manufactures natural
gas flare stacks and ignition systems for use in oilfield, refinery, and
petrochemical plant applications. Hi-Tech has a facility located in Midland,
Texas, where it assembles natural gas compressor units. See " -- The Wellhead
Business," " -- The Flare Business," " -- The Compression Business" and the
historical Financial Statements of the individual Founding Companies included
herein.

The Founding Companies currently provide their products and services
largely to a customer base of approximately 440 companies, out of a potential
20,400 independent oil and gas exploration and production companies operating in
Louisiana, Texas, New Mexico, Oklahoma, Colorado and Wyoming. The Company
believes that because such independent producers are actively buying fields from
the major companies, the market for the Company's products and services will
continue to expand.

The Company is a Texas corporation organized on October 20, 1997 with Alvin
H. Dueitt as its sole shareholder pending the Reorganization. Its principal
executive offices are located at 615 Upper North Broadway, Suite 950, Corpus
Christi, Texas 78477. Its telephone number is (512) 882-3536.

21
<PAGE>
OPERATING PHILOSOPHY AND GROWTH STRATEGIES

The Company's operating philosophy is to maximize profit while preserving
the integrity of shareholders' equity. Management believes that this can be
achieved by implementing the following growth strategies:

ACCELERATING INTERNAL GROWTH. The Company believes that following the
Reorganization and the Offering and in conjunction with implementation of its
acquisition plans, acceleration of internal growth can be initiated by combining
its existing separate marketing efforts and establishing a regional sales and
marketing program to increase its business opportunities. The Company also
believes that it can accelerate internal growth by more actively pursuing
international sales. Although it has on occasion made international sales in the
past, it has lacked the financial resources to pursue such sales aggressively
before the Offering.

CAPITALIZING ON NEW CORPORATE STRUCTURE. Centralization of purchasing
operations should increase the Company's ability to negotiate more favorable
terms with respect to insurance and financing than were available to the
Founding Companies as independent operations. Management further believes that
there will be opportunities to eliminate redundant facilities and equipment
through coordination of subsequently acquired operations and to benefit from
cross-marketing and increased equipment utilization.

EXPANDING THROUGH ACQUISITIONS. The Company intends to pursue an
aggressive acquisition strategy to enhance its position in its current markets
and to acquire operations in new markets by expanding into new geographic areas.
The Company is actively seeking to acquire well established manufacturing and
service operations that either broaden the range of services provided by the
Company in its existing markets or expand the geographic scope of the Company's
current operations. The Company is not currently involved in negotiations with
respect to, and has no agreements or understandings with respect to any
potential acquisitions.

THE WELLHEAD BUSINESS

The production of oil and gas requires the support of specialized
production equipment and engineering services, particularly as production
operations have expanded into ever more remote and inhospitable locations.
Growth in the market for wellhead equipment is primarily related to the price of
oil and gas, although the market for remanufactured wellhead and other
specialized production equipment can remain strong in a price downturn as
producers maintain already operating wells as efficiently as possible.

Wellhead was formed in 1990 to remanufacture wellhead equipment. In June
1994, Wellhead acquired WRI, Inc. with facilities in Robstown, Houston and
Midland, Texas and Lafayette, Louisiana, expanding its geographical area and its
customer base. In 1996 Wellhead also opened a facility in Shreveport, Louisiana.

Wellhead manufactures, supplies, repairs, installs, maintains and
refurbishes pressure control equipment used at the wellhead in the drilling for
and production and transmission of oil and gas, both onshore and offshore. The
primary products include wellheads, gate valves, ball valves, drilling spools
and manifolds. The equipment is manufactured or remanufactured in a variety of
sizes and to various specifications with working pressure ratings up to 20,000
pounds per square inch. Wellhead equipment is designed to support the casing and
production pipe on a completed well and includes casing head housings, casing
heads, casing spools, tubing heads and casing and tubing hangers. Valves of
different sizes and design are assembled with other components into a device
known as the "Christmas Tree," which is mounted on the wellhead equipment and
is used to control pressure and the flow of oil and gas from a producing well.
Most Christmas Trees are custom designed to meet individual customer
requirements.

A substantial portion of Wellhead's oilfield equipment business is
conducted through surplus wellhead equipment management programs. Under these
programs, Wellhead collects out-of-service equipment at the customer's wellhead
or accepts delivery of a customer's equipment at one of its locations. Such
equipment is inspected by Wellhead upon its receipt and, before being
inventoried, is classified according to its condition and degree of
obsolescence. If deemed salvageable, the equipment is cleaned and disassembled.
Components are either replaced or repaired. The equipment is then remachined on
Wellhead's lathes, boring mills, radial drills, milling machines and grinding
machines to new equipment standards. Substantially all remanufacturing is done
in accordance with American Petroleum Institute ("API") specifications.

22
<PAGE>
Reconditioned equipment may thereafter be reemployed by the customer in
accordance with its requirements. The customer is charged for this
reconditioning service based on an established price schedule, in addition to
any charges incurred for receiving, inspecting and classifying the equipment. In
certain cases, Wellhead may also purchase the customer's used equipment for
resale to other customers. The resale price of the equipment is typically based
upon a percentage of the current list price for new equipment. The payment for
the customer's equipment is occasionally in the form of a merchandise credit to
be applied toward a future purchase by that customer. Although Wellhead does not
expressly warrant reconditioned equipment, Wellhead does work with its customers
to correct or resolve any complaints or other issues raised by a customer.

In addition to remanufacturing the equipment of its customers, Wellhead
also purchases used equipment for its own account from various sources, which it
then remanufactures for resale. Using remanufactured or reconditioned equipment
allows the customer to lower initial drillwell capital costs, which
significantly improves overall exploration and production project economics and
reduces oil and gas product price sensitivity.

The sales and service locations of Wellhead act, in part, as clearing
houses for oilfield operators. If an operator at a particular location requires
a unique component held by Wellhead for another customer, Wellhead will contact
the customer and effect a purchase or exchange for the required equipment and
resell such equipment to the customer requiring it. Wellhead maintains a
computerized inventory system which allows it to determine if requested
equipment is available at any of its locations at the time requested.

Of Wellhead's total sales of wellhead equipment, sales of remanufactured
and refurbished wellhead equipment account for approximately 50%. Sales of new
wellhead equipment account for approximately 25%, and service renewals,
transportation and rentals account for the remainder. Wellhead generally
achieves a higher margin on sales of refurbished equipment but anticipates that
sales of new equipment will increase over time as a percentage of the whole.

Wellhead had sales to five customers that represented 19% of total Wellhead
revenue for the year ended December 31, 1996. No single customer accounted for
over 10%, and the identity of customers varies from year to year, but loss of a
group of customers accounting for such a portion of the business could have a
material adverse impact on the business.

THE FLARE BUSINESS

The drilling for and production of oil and gas results in certain gaseous
hydrocarbon byproducts that generally must be burned off at the source. Although
flares and flare systems of some sort have been part of the oilfield and
petrochemical environment for many years, increasing regulation of emissions
have resulted in a significant increase in demand for flare systems of
increasingly complex design meeting the strictest environmental regulations.
Growth is primarily related, as is the case for most industries connected with
oil and gas, to the price of oil and gas.

Flare King was acquired by its current owners in 1993. Flare King designs,
manufactures, installs and services flare stacks and related ignition and
control devices for onshore and offshore burning of gas compounds such as H2S,
CO2, natural gas and LPGs. Flare King produces two ignition systems for varied
applications: (a) a standing jet-like pipe for minimal fuel consumption, with a
patented electronic igniter; and (b) an electronic sparked ignition system.
Flare tips are available in carbon steel as well as many grades of stainless
steel alloys and the stacks can be free standing, guyed, or trailer mounted. The
flare stack and ignition systems are designed to use a smokeless
state-of-the-art design for reduced emissions which meet or exceed government
regulated clean air standards. The Flare King product line includes
solar-powered flare ignition systems and thermocouple control systems designed
to detect the loss of combustion in the product stream and reignite the product
stream. These products contain specially-designed combustion tips and utilize
pilot flow Venturi tubes to maximize the efficient burning of waste gas with a
minimal use of pilot or assist gas, thereby minimizing the impact on the
environment of the residual output. Increased emphasis on "clean air" and
industry emissions has had a positive effect on the flare industry. Flare King's
broad energy industry experience has allowed it to work closely with its
customers to seek cost-effective solutions to their flare requirements.

23
<PAGE>
Flare King had sales to five customers that represented 38% of total Flare
King revenue for the year ended December 31, 1996. No single customer accounted
for over 10% and the identity of customers varies from year to year, but loss of
a group of customers accounting for such a portion of the business of Flare King
could have a material adverse impact on its business.

THE COMPRESSION BUSINESS

Natural gas compressors are used in a number of applications intended to
enhance the productivity of oil and gas wells, gas transportation lines and
processing plants. Compression equipment is required to boost the well's
production to economically viable levels and allow gas to be brought to market.
As gas is transported through a pipeline, compression equipment is applied to
allow the gas to continue to flow in the pipeline to its destination.
Additionally, compressors re-inject associated gas to artificially lift liquid
hydrocarbons which increases the rate of crude oil production from oil and gas
wells.

Changing well and pipeline pressures and conditions over the life of a well
often require producers to reconfigure their compressor units to optimize the
well production or pipeline efficiency. Because the equipment is highly
technical, a highly trained staff of field service personnel, a substantial
parts inventory and a diversified fleet of natural gas compressors are often
necessary to perform such functions in the most economic manner. It is not,
however, reasonably efficient or even, in many cases, economically possible for
independent natural gas producers to maintain such capabilities individually.
Also, certain major domestic oil companies, in order to streamline their
operations and reduce their capital expenditures and other costs, have sold
certain domestic energy reserves to independent energy producers and have
outsourced many facets of their operations. Such initiatives, in the opinion of
Hi-Tech, are likely to contribute to increased rental of compressor equipment.
For that reason, Hi-Tech, which initially concentrated on selling gas
compression units to its customers, has created its own compressor-rental fleet
to take advantage of the rental market.

Hi-Tech was formed in 1994 to take advantage of the concept of packaging a
rotary screw compressor, making available lower cost compression for marginal
wells. Hi-Tech provides its customers with a full range of compressor rental,
maintenance and contract compression services. As of December, 1997, Hi-Tech's
gas compressor fleet consisted of nine units, ranging from 20 to 80 horsepower
and had under construction eight additional rental units at 80 horsepower. The
size, type and geographic diversity of this rental fleet enables Hi-Tech to
provide its customers with a range of compression units that can serve a wide
variety of applications, and to select the correct equipment for the job, rather
than trying to "fit" the job to its fleet of equipment. Hi-Tech bases its gas
compressor rental rates on several factors, including the cost and size of the
equipment, the type and complexity of service desired by the customer, the
length of contract, and the inclusion of any other services desired, such as
installation, transportation and daily operation.

Although natural gas compressors generally do not suffer significant
technological obsolescence, they do require routine maintenance and periodic
refurbishing to prolong their useful life. Routine maintenance includes
alignment, compression checks, and other parametric checks which indicate a
change in the condition of the equipment. In addition, oil and wear-particle
analysis is performed on all units prior to their redeployment at specific
compression rental jobs. Overhauls are done on a condition-based interval
instead of a time-based schedule. In Hi-Tech's experience, these rigorous
procedures maximize component life and unit availability and minimize downtime.

Hi-Tech also fabricates natural gas compressors for its customers,
designing compressors to meet the unique specifications dictated by the well
pressure, production characteristics and the particular applications for which
compression is sought. In general, units to be sold to third parties are
assembled according to customer specification and sold on a turnkey basis. In
order to meet the ongoing needs of its customers, Hi-Tech offers a variety of
services, including: (i) engineering, fabrication and assembly of the compressor
unit; (ii) installation and testing of the units; (iii) ongoing performance
review to assess the need for a change in compression; and (iv) periodic
maintenance and replacement parts supply.

San Juan Compression, L.L.C. and Marathon Oil Company accounted for 31% and
25%, respectively, of total Hi-Tech revenue for the year ended December 31,
1996. San Juan Compression, L.L.C. purchases compressor units from Hi-Tech
(under the name "Rotary Gas Systems") pursuant to an Exclusive Sales

24
<PAGE>

Agreement that grants San Juan Compression, L.L.C. the exclusive right to market
Rotary Gas Systems compressor units in the Farmington, New Mexico area as long
as it purchases a specified number of units per year. The Exclusive Sales
Agreement currently continues in effect. No ongoing purchase contract or other
ageement exists between Hi-Tech and Marathon Oil Company. Loss of either such
customer could have a material adverse impact on the business of Hi-Tech.

SALES AND MARKETING

GENERAL. The Company conducts its operations from each of its locations.
Each location, with the exception of the executive offices, maintains inventory
for local customer requirements, trained service technicians, and machine shop
capabilities to provide quick delivery and service for its customers. The
Company's sales force also operates out of each location and focuses on
communication with its customers and potential customers through frequent direct
contact, technical assistance, print literature, and direct mail, as well as
through "word of mouth" referrals.

Additionally, the Company's personnel coordinate with each other to develop
relationships with customers who operate in multiple regions. The sales
personnel of the Company maintain intensive contact with the Company's
operations personnel in order to promptly respond to and satisfy customer needs.
The Company's overall sales efforts concentrate on demonstrating the Company's
commitment to enhancing the customer's cash flow through superior product
design, fabrication, manufacturing, installation, customer service and
aftermarket support.

WELLHEAD EQUIPMENT SEGMENT. The Company has eleven salesmen in the
wellhead equipment segment. The wellhead equipment marketing program emphasizes
providing complete supply chain management of wellhead equipment requirements
for its customers. This program includes repair of customer equipment, sale of
remanufactured equipment, sale of new equipment, and a distribution network of
machine shop locations and sales offices to provide prompt local service and
support.

FLARE SYSTEMS SEGMENT. The Company employs one salesman in the flare
systems segment. The marketing program emphasizes the Company's ability to
design, manufacture, install and service flares with the latest technology.

COMPRESSION SEGMENT. The Company employs one salesman in the compression
segment. The compression marketing program emphasizes the ability of the Company
to design and fabricate gas compressor units in accordance with the customer's
unique specifications and to provide all necessary service for such units.

COMPETITION

GENERAL. Over the past several years, there has been severe price
competition in the oil and gas industry which has continued to have a
substantial impact on profit margins of specialty service providers. Although
the Company has experienced improved profit margins in the last two years, no
assurance can be given that such trend will continue.

WELLHEAD EQUIPMENT SEGMENT. Oilfield equipment, both new and used, is sold
by many manufacturers, distributors and dealers, some of which have
substantially greater resources than the Company. The Company estimates that it
has five major competitors in the wellhead equipment segment, but does not have
sufficient information to determine its competitive position within that group.
The Company believes, however, that relatively few competitors offer programs
involving maintenance, reconditioning, storage, distribution, and management of
equipment such as those offered by the Company. In offering its programs, the
Company emphasizes its ability to provide reconditioned oilfield equipment at
favorable prices while at the same time performing services which the customer
would otherwise have to perform or have performed at substantial cost and
inconvenience. The Company's management believes that it has a distinct
competitive advantage against many of these companies because remanufactured
wellhead equipment reduces the operating costs of oil and gas operators and thus
increases their profit margins.

FLARE SYSTEMS SEGMENT. The flare business is also highly competitive.
Flare King estimates that it has six major competitors in the flare systems
segment, but does not have sufficient information to determine its competitive
position within that group. Flare King's responsive, experienced staff have
enabled it to

25
<PAGE>
develop a strong customer base. Flare King's commitment to product quality and
service are reflected in repeat business with its customers.

COMPRESSION SEGMENT. The natural gas compression and power services
business is highly competitive. Overall, the Company experiences considerable
competition from companies with significantly greater financial resources and,
on a regional basis, from several smaller companies which compete directly with
the Company. The Company estimates that it has six major competitors in the
natural gas compression segment, but does not have sufficient information to
determine its competitive position within that group. The Company believes that
it competes effectively on the basis of price, customer service, including the
ability to place personnel in remote locations, flexibility in meeting customer
needs and quality and reliability of its compressors and related services.

Compressor industry participants can achieve significant advantages through
increased size and geographic breadth. As the number of rental units in the
Company's rental fleet increases, the number of sales, engineering,
administrative and maintenance personnel required and the minimum level of
inventory required to be maintained do not increase commensurately. As a result
of economies of scale, the Company, with a growing rental fleet, has relatively
lower operating costs and higher margins than smaller companies. These benefits
are expected to increase as the Company implements its acquisition strategy.

The Company also fabricates natural gas compressors in competition with
other fabricators of compressor units. The compressor fabrication business is
dominated by a few major competitors, several of which also compete with the
Company in the compressor rental business.

PROPERTIES

The Company leases its 1,227 square-foot executive offices in Corpus
Christi, Texas on a month-to-month basis. The Company also operates the six
facilities described below for its combined operations. All of these facilities
are leased. All of the facilities, with the exception of the executive office
located in Corpus Christi, Texas, are used principally for operations, testing,
warehousing and storage, general and administrative functions, and training.

Wellhead leases (i) a 14,660 square-foot facility in Houston, Texas; (ii) a
10,000 square-foot facility in Robstown, Texas; (iii) a 4,800 square-foot
facility in Midland, Texas; (iv) a 5,000 square-foot facility in Shreveport,
Louisiana; and (v) a 9,950 square-foot facility in Lafayette, Louisiana.
Together, all of the Wellhead locations provide over 40,000 square-feet of metal
machine shop space fully equipped with all machinery necessary to manufacture
and refurbish all wellhead components on site. The Houston and Midland, Texas
locations are rented pursuant to month-to-month arrangements and are subject to
termination on short notice. The Company believes that it could readily obtain
substantially similar facilities within the same area at similar rates if any
such termination were to occur and that the expense associated with obtaining
and moving operations to any such facility would not be material. The four
leases are for varying terms, and the Company does not anticipate any difficulty
in renewing such leases on substantially similar terms.

Flare King and Hi-Tech share a leased 24,645 square foot facility in
Midland, Texas. This facility provides Flare King and Hi-Tech with sufficient
space to manufacture, test and assemble their equipment on site.

The aggregate expense for the facilities leased by the Founding Companies
was approximately $227,000 during 1996. The Company's current facilities are
anticipated to provide the Company with sufficient space and capacity for at
least the next three years and thus there are no current plans to open new
locations, unless they are acquired as a result of any future acquisitions. The
Company believes that its properties are generally well maintained, in good
condition and adequate for its present needs.

LIABILITY AND OTHER INSURANCE COVERAGE

The Company's equipment and services are provided to operations that are
subject to hazards inherent in the oil and gas industry, such as blowouts,
explosions, craterings, fires and oil spills. The Company maintains liability
insurance that it believes to be customary in the industry against these
hazards, and losses from such hazards have not historically exceeded its
insurance coverage. The Company also maintains

26
<PAGE>

insurance with respect to its facilities. Although management believes that the
Company's insurance coverage is adequate and comparable to that generally
carried in the wellhead manufacturing, flare systems and gas compression
industry segments, there can be no assurance given that such insurance will be
sufficient to cover the Company's liabilities or will be generally available in
the future or, if available, that premiums will be commercially justifiable. If
the Company were to incur substantial liability and such damages were not
covered by insurance or were in excess of policy limits, or if the Company were
to incur such liability at a time when it is not able to obtain liability
insurance, its business, results of operations and financial condition could be
materially adversely affected. See "Risk Factors -- Operating Risks and
Insurance."

GOVERNMENT REGULATION

The Company is subject to numerous federal, state, local laws and
regulations relating to the storage, handling, emission and discharge of
materials into the environment, including the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA"), the Clean Water Act, the
Clean Air Act and the Resource Conservation and Recovery Act. As a result of its
fabrication and refurbishing operations, the Company generates or manages
hazardous wastes, such as solvents, thinner, waste paint, waste oil, washdown
wastes, and sandblast material. Although the Company attempts to identify and
address contamination before acquiring properties, and although the Company
attempts to utilize generally accepted operating and disposal practices,
hydrocarbons or other wastes may have been disposed of or released on or under
properties owned, leased, or operated by the Company or on or under other
locations where such wastes have been taken for disposal. These properties and
the wastes disposed thereon may be subject to federal or state environmental
laws that could require the Company to remove the wastes or remediate sites
where they have been released.

The Company believes that its existing environmental control procedures are
adequate and it has no current plans for substantial operating or capital
expenditures relating to environmental control requirements. The Company
believes that it is in substantial compliance with environment laws and
regulations and that the phasing in of emission controls and other known
regulatory requirements at the rate currently contemplated by such laws and
regulations will not have a material adverse affect on the Company's financial
condition or operational results. Some risk of environmental liability and other
costs are inherent in the nature of the Company's business, however, and there
can be no assurance that environmental costs will not rise. Moreover, it is
possible that future developments, such as increasingly strict requirements and
environmental laws and enforcement policies thereunder, could lead to material
costs of environmental compliance by the Company. While the Company may be able
to pass on the additional cost of complying with such laws to its customers,
there can be no assurance that attempts to do so will be successful.

RESEARCH AND DEVELOPMENT

The Company engages in a continuing effort to improve its compressor and
flare operations. Research and development activities in this regard include new
and existing product development testing and analysis, process and equipment
development and testing and product performance improvement. The Company
continues to develop low emission compressor and engine technology. The Company
also focuses its activities on reducing overall costs to the customer, which
includes both the initial capital cost for equipment and the operating costs
associated with such equipment, including energy consumption, maintenance cost
and environmental emissions. Research and development expenditures for 1996
were, however, not material and the Company did not have a specific amount
budgeted for research and development in 1997 but anticipates that it will
expend approximately $50,000 in 1998.

BACKLOG

The Company's wellhead operations currently have no backlog. With respect
to its compressor operations, the Company had a backlog of approximately
$425,000 as of September 30, 1997 as compared to approximately $500,000 as of
the same period in 1996 and approximately $172,000 as of the same period in
1995. With respect to its flare system operations, the Company had a backlog of
approximately $52,000 at September 30, 1997 as compared to approximately
$129,000 as of the same period in 1996 and approximately $31,000 at the same
period in 1995. Backlog consists of firm customer orders for which a

27
<PAGE>
purchase order has been received, satisfactory credit or financing arrangements
exist and delivery is scheduled.

PATENTS, TRADEMARKS AND OTHER INTELLECTUAL PROPERTY

The Company believes that the success of its business depends more on the
technical competence, creativity and marketing abilities of its employees than
on any individual patent, trademark or copyright. Nevertheless, as part of its
ongoing research, development and manufacturing activities, the Company has a
policy of seeking patents when appropriate on inventions concerning new products
and product improvements. The Company currently owns two United States patents
covering certain flare system technologies, which expire on May 2, 2009 and
December 11, 2010, respectively. The Company does not own any foreign patents.
Although the Company continues to use the patented technology and considers it
useful in certain applications, the Company does not consider these patents to
be material to its business as a whole.

The Company also relies on trade secret protection for its confidential and
proprietary information and enters into confidentiality agreements with its key
employees. There can be no assurance, however, that others will not
independently obtain similar information or otherwise gain access to the
Company's trade secrets.

SUPPLIES AND RAW MATERIALS

With respect to its compressor and flare system operations, the principal
raw materials used by the Company are cast and forged iron and steel. Such
materials are generally available from a number of suppliers, and accordingly,
the Company is not dependent on any particular supplier. The Company currently
does not have long term contracts with its suppliers of raw materials, but
believes its sources of raw materials are reliable and adequate for its needs.
The Company has not experienced any significant supply problems in its
operations and does not anticipate any significant supply problems in the
foreseeable future.

With respect to its wellhead operations, the Company acquires used wellhead
equipment. Such equipment is generally available from its customers, salvage
yards, and other remanufacturers of wellhead equipment. The Company is not
dependent on any particular source for its used wellhead equipment. The Company
has not experienced any significant supply problems in its operations and does
not anticipate any significant supply problems in the foreseeable future.

EMPLOYEES

As of September 30, 1997, the Company had 83 employees, of which 15 are
employed in administration, 13 in sales and marketing, 43 in technical
capacities and 12 in field services. No employees are represented by labor
unions and the Company believes that its relations with its employees are
satisfactory.

LEGAL PROCEEDINGS

From time to time the Company has been and expects to continue to be
subject to various legal proceedings, all of which are of an ordinary or routine
nature and incidental to the operations of the Company. Such proceedings have
not in the past had a material impact on the Company's results of operations or
financial condition. In the opinion of the Company's management, such
proceedings and actions should not, individually or in the aggregate, have a
material adverse effect on the Company's results of operations or financial
condition. There can, however, be no assurance that legal proceedings and
actions will not in the future have a material impact on such results or
condition.

28
<PAGE>
THE REORGANIZATION

Simultaneously with and as a condition to the closing of the Offering, the
Company will issue to the holders of the outstanding equity securities of the
Founding Companies shares of its Common Stock in exchange for the ownership
interests of such holders in such companies. In connection with the
Reorganization, the equityholders of Wellhead (other than Hi-Tech, which will
not exchange the 1500 shares of Wellhead owned by it) will receive 5.068638
shares of Common Stock of the Company for each share of Wellhead held by them
for an aggregate of 2,659,175 shares of Common Stock of the Company, the
equityholders of Flare King will receive an average of 2.730393 shares of Common
Stock of the Company for each share of Flare King held by them for an aggregate
of 304,316 shares of Common Stock of the Company and the equityholder of Hi-Tech
(other than Flare King, which will not exchange the 50% membership interest held
by it) will receive 3,105.18 shares of Common Stock of the Company for each one
percent of membership interest in Hi-Tech held by them for an aggregate of
155,259 shares of Common Stock of the Company. Under Section 1032 of the
Internal Revenue Code of 1986, as amended (the "Code"), the Company will not
recognize any gain or loss in the Reorganization or the Offering. Based on
Section 351 of the Code and Internal Revenue Service regulations thereunder and
interpretations thereof, it is anticipated that equityholders of Wellhead,
Hi-Tech, and Flare King will not recognize gain or loss in the Reorganization.
Immediately following the Reorganization, Flare King will distribute its
membership interest in Hi-Tech to the Company, Hi-Tech will distribute its
shares of Wellhead to the Company and each of the Founding Companies will be a
wholly owned subsidiary of the Company.

The following table sets forth the consideration to be paid by the Company
for each of the Founding Companies:

SHARES OF
COMMON STOCK
------------
Wellhead................................ 2,659,175
Flare King.............................. 304,316
Hi-Tech................................. 155,259
------------
Total................................... 3,118,750
============

Thus, holders of Wellhead stock before the Reorganization will receive 85%
of the voting stock of the combined Company without giving effect to the shares
issued pursuant to the Offering and 65% giving effect to the issuance of shares
pursuant to the Offering. In connection with the Reorganization, and as
consideration for their interests in the Founding Companies, certain officers
and directors of the Company will receive shares of Common Stock of the Company
determined on the same basis as the other equityholders of the Founding
Companies as follows:

SHARES OF
NAME COMMON STOCK
- ---------------------------------------- ------------
Wallace O. Sellers...................... 472,227(1)
Alvin H. Dueitt......................... 650,185
Martin L. Tomlin........................ 642,582
Earl R. Wait............................ 5,068

- ------------

(1) Includes 90,112 shares to be received by Naudain Ives Sellers, Mr. Sellers'
spouse.

The consummation of the Reorganization is subject to customary conditions.
These conditions include, among others, the continuing accuracy on the closing
date of the Reorganization of the representations and warranties with respect to
the Founding Companies, the performance by the parties thereto of all covenants
included in the agreement relating to the Reorganization, the receipt of certain
consents of third parties and the absence of a material adverse change in the
results of the operations, financial condition or business of each Founding
Company.

There can be no assurance that the conditions to the closing of the
Reorganization will be satisfied or waived or that the reorganization agreement
will not be terminated prior to consummation. If the Reorganization is
terminated for any reason, the Company does not intend to consummate the
Offering.

<PAGE>
MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth information concerning the Company's
directors and executive officers and those persons who will become executive
officers in connection with the Offering:

<TABLE>
<CAPTION>
NAME AGE POSITION
- ---------------------------------------- --- ---------------------------------------------------------------------
<S> <C>
Wallace O. Sellers...................... 68 Director and Chairman of the Board of Directors
Alvin H. Dueitt......................... 42 Director and President and Chief Operating Officer of the Company and
President of Wellhead
Burnace J. Boles, Jr.................... 52 Vice President of the Company and President of Flare King
Earl R. Wait............................ 54 Chief Accounting Officer and Secretary/Treasurer of the Company
Wayne L. Vinson......................... 39 President of Hi-Tech(1)
Martin L. Tomlin........................ 47 Vice President of Wellhead(1)
J. Richard Espinosa..................... 53 Vice President of Wellhead(1)
Donald D. McAtee........................ 47 Controller of Wellhead(1)
L. Melvin Cooper........................ 44 Director
Charles K. Miller, Jr................... 40 Director
Francis M. Ricci........................ 54 Director
</TABLE>

- ------------

(1) Will have certain responsibilities and functions of an executive officer of
the Company.

The principal occupations and positions for the past five years of each of
the person listed above are as follows:

Wallace O. Sellers has served as a director and the Chairman of the Board
of Directors of the Company since its organization on October 20, 1997. Since
January 1, 1995, he has been retired, having served from November 1986 through
December 1994 as President and Chief Executive Officer of Enhance Financial
Services, Inc. ("Enhance"). Mr. Sellers is serving as Vice-Chairman of the
Board and Chairman of the Executive Committee of Enhance and also serves as a
director of Danielson Holding Corp. ("Danielson"). Enhance and Danielson are
each reporting companies under the Securities Exchange Act of 1934.

Alvin H. Dueitt has served as a director and the President of the Company
since the Company's organization on October 20, 1997. Since April 1, 1990, he
has been serving as President and Chief Executive Officer of Wellhead. Mr.
Dueitt has more than 19 years of management experience in the energy service
industry.

Burnace J. Boles, Jr. has served as the Vice President of the Company since
its organization on October 20, 1997. Since January 1, 1997, he has been serving
as President of Flare King and from October 1, 1996 he served as Flare King's
General Manager. Mr. Boles pursued other business interests from July 1996
through October 1996. From January 1995 through July 1996, he was West Area
Manager - Midland Region for Burlington Resources. From March 1986 through
December 1994, he was West Region Production Manager - Meridian Oil. Mr. Boles
has more than 28 years of experience in the energy service industry.

Earl R. Wait has served as the Chief Accounting Officer and
Secretary/Treasurer of the Company since its organization on October 20, 1997.
He has served as Secretary/Treasurer of Wellhead since 1992, as
Secretary/Treasurer of Flare King since April 1993 and as Assistant
Secretary/Treasurer for Hi-Tech since June 1996. Mr. Wait is a certified public
accountant and has more than 15 years of experience in the energy service
industry.

Wayne L. Vinson has served as the President of Hi-Tech since February,
1994. From January 1990 to June 1995, Mr. Vinson served as Vice President and
since June 1995, he has served as President of Vinson Operating Company. Since
1992, he has served as Vice President of CNG Engines Co. Since 1988, he has
served as President of A&W Petroleum Inc. From August 1985 through March 1997,
he served as Vice

30
<PAGE>
President of Production Meter and Testing, Inc. Despite the other business
commitments of Mr. Vinson, he devotes substantially all of his time to the
performance of his duties as President of Hi-Tech. Mr. Vinson has more than 13
years of experience in the energy service industry.

Martin L. Tomlin has served as Vice President of Wellhead since April 1,
1990. Mr. Tomlin has more than 22 years of experience in the energy service
industry.

J. Richard Espinosa has served as Vice President of Wellhead since June
1994. From 1978 until their acquisition by Wellhead, Mr. Espinosa served as
President and a director of WRI, Inc. and Wellhead Recycling, Inc. Mr. Espinosa
has more than 25 years of experience in the energy service industry.

Donald D. McAtee has served as Controller for Wellhead since June 1994.
From July 1992 through June 1994, he served as Controller for WRI, Inc., which
was acquired by Wellhead in June 1994. Mr. McAtee is a certified public
accountant and has more than 19 years of experience in the energy service
industry.

L. Melvin Cooper has served as a director of the Company since its
organization on October 20, 1997. Since August 1997 Mr. Cooper has acted as an
independent financial consultant. From March 1997 through August 1997 Mr. Cooper
served as President of ImmuDyne, Inc. and from February 1996 through March 1997
as its Senior Vice President, Secretary and Chief Financial Officer. Mr. Cooper
was a partner in MCN Partners, an investment partnership, from June 1995 through
February 1996. From May 1994 through June 1995 Mr. Cooper served as General
Manager and Director of AquaNatural Company and from March 1993 through May 1994
as its Vice President, Secretary and Chief Financial Officer. Mr. Cooper served
as Vice President and Chief Financial Officer of Southern Holdings Corp. from
1989 through March 1993. Mr. Cooper is a certified public accountant.

Charles K. Miller, Jr. has served as a director of the Company since its
organization on October 20, 1997. Mr. Miller has served as a director of
Wellhead since 1995 and has served as the President and Chief Executive Officer
of Miller Environmental Services, Inc. since 1983.

Francis M. Ricci has served as a director of the Company since its
organization on October 20, 1997. Since 1991, Mr. Ricci has served as Chairman
and President of Precision Acquisitions, Inc., which provides corporate finance
and management consulting services. Mr. Ricci is a certified public accountant
and served in both client service and firm management capacities with Deloitte
Haskins & Sells (now Deloitte & Touche LLP) for 22 years. Since November 1995
Mr. Ricci has acted as a corporate finance consultant to D.E. Frey & Company,
Inc., the Underwriter.

The Board of Directors has been divided into three classes of one, two and
two directors with directors serving staggered three-year terms expiring at the
annual meeting of stockholders in 1998, 1999 and 2000, respectively. At each
annual meeting of stockholders, one class of directors will be elected for a
full term of three years to succeed those directors in the class whose term is
expiring. With respect to the existing Board of Directors, the term of Mr.
Miller will expire in 1998, the terms of Mr. Cooper and Mr. Ricci in 1999 and
the terms of Mr. Dueitt and Mr. Sellers in 2000. All officers of the Company
serve at the discretion of the Board of Directors.

The Company's Board of Directors has established an Audit Committee and a
Compensation Committee. The members of the Audit Committee and the Compensation
Committee will be Messrs. Cooper and Ricci and Messrs. Cooper and Miller,
respectively.

DIRECTOR COMPENSATION

Directors who are also employees of the Company or one of its subsidiaries
will not receive additional compensation for serving as directors. Each director
who is not an employee of the Company or one of its subsidiaries will receive a
fee of $1,000 for attendance at each meeting of the Board of Directors and
$1,000 for each committee meeting (unless held on the same day as a meeting of
the Board of Directors). Directors are also reimbursed for out-of-pocket
expenses incurred in attending meetings of the Board of Directors or committees
thereof. See also " -- 1997 Incentive Compensation Plan."

31
<PAGE>
EXECUTIVE COMPENSATION

The following table sets forth information concerning the compensation
earned during the year ended December 31, 1996 by the president of Wellhead, who
has also served as president of the Company since its organization in October
1997 and the other most highly compensated executive officer of the Founding
Companies, each of whom will be an executive officer of the Company or a
subsidiary thereof and whose annual salary and bonus for the year ended December
31, 1996 exceeded $100,000 (the "named executive officers"):

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
OTHER ALL
NAME AND PRINCIPAL POSITION(S) WITH THE ANNUAL OTHER
COMPANY(1) SALARY BONUS COMPENSATION COMPENSATION
- ---------------------------------------- --------- --------- ------------ ------------
<S> <C> <C> <C> <C>
Alvin H. Dueitt, President of the
Company and President of Wellhead..... $ 77,770 $ 91,268 (2) (3)
J. Richard Espinosa, Vice President of
Wellhead.............................. 70,539 74,686 (2) (3)
</TABLE>
- ------------

(1) No executive officer of any of the individual Founding Companies received
annual compensation in excess of $100,000 in 1995 or 1994.

(2) The Company provides an automobile to each of the named officers, the
personal use of which is valued at an amount not exceeding 10% of such
officer's annual compensation.

(3) The Company made contributions to its 401(k) plan of $2,906 and $2,761 for
the accounts of Mr. Dueitt and Mr. Espinosa, respectively.

EMPLOYMENT AGREEMENTS

The Company has entered into employment agreements (the "Employment
Agreements") with Alvin H. Dueitt, Martin L. Tomlin and J. Richard Espinosa
(the "Contracting Officers"). The Employment Agreements will be effective upon
consummation of the Reorganization and the Offering. Each of the Employment
Agreements will be for a period of three years commencing on the closing of the
sale of Common Stock in the Offering and will provide for the payment of an
initial base salary at an annual rate not less than $120,000, $77,000, and
$70,000, respectively. The base salaries will be subject to adjustment upon
recommendation of the Compensation Committee. The Employment Agreements provide
for the payment of incentive compensation based on a percentage of consolidated
profits of the Company for Mr. Dueitt and on a percentage of Wellhead profits
for Messrs. Tomlin and Espinosa.

The Employment Agreements contain certain confidentiality and
noncompetition provisions and provide for the termination of the employment of a
Contracting Officer on the grounds of (i) cause, i.e., willful breach or neglect
of duty, willful violation of Company policies, refusal to obey reasonable
direction, conviction of a felony or fraud, or inability to perform duties
because of a legal impediment, (ii) disability, (iii) death or (iv) certain
specified changes affecting the Contracting Officer's employment. The Employment
Agreements also provide that if the Contracting Officer is terminated, the
Contracting Officer will receive one lump-sum payment in an amount equal to
three months' base salary (six months with respect to Mr. Dueitt).

Burnace J. Boles, Jr. and Flare King are parties to an existing employment
contract having a term of five years which expires in January of 2002. The
agreement provides for annual compensation at a base rate of $40,000, subject to
upward adjustment at the discretion of the Board of Directors of Flare King. In
addition, Mr. Boles is entitled to receive an annual bonus based on a percentage
of the earnings of Flare King before interest and taxes. Other terms are
substantially the same as those described with respect to the Employment
Agreements.

1997 INCENTIVE COMPENSATION PLAN

In October 1997, the Board of Directors and the sole shareholder approved
the Company's 1997 Incentive Compensation Plan (the "Plan"). The purpose of
the Plan is to provide employees, non-employee

32
<PAGE>
directors and consultants with additional incentives by increasing their
ownership interests in the Company. Individual awards under the Plan may take
the form of one or more of (i) either incentive stock options or nonqualified
stock options, (ii) stock appreciation rights, (iii) restricted or deferred
stock, (iv) dividend equivalent rights and (v) other awards not otherwise
provided for, the value of which is based in whole or in part upon he value of
the Common Stock.

The Compensation Committee will administer the Plan, select the individuals
who will receive awards and establish the terms and conditions of those awards.
The maximum number of shares of Common Stock that may be subject to outstanding
awards, determined immediately after the grant of any award may not exceed
411,000 shares. Shares of Common Stock which are attributable to awards which
have expired, terminated or been canceled or forfeited are available for
issuance or use in connection with future awards.

The Plan will remain in effect until terminated by the Board of Directors.
The Plan may be amended by the Board of Directors without the consent of the
stockholders of the Company, except that any amendment, although effective when
made, will be subject to stockholder approval if required by any federal or
state law or regulation or by the rules of any stock exchange or automated
quotation system on which the Common Stock may then be listed or quoted. There
have been no awards made under the Plan to date.

CERTAIN TRANSACTIONS

EXISTING MATTERS

Wellhead will continue to lease certain of its facilities from J. Richard
Espinosa, a Vice-President of Wellhead, pursuant to a Commercial Lease Agreement
dated June 6, 1994. The lease provides for a total annual rent of approximately
$60,000 with an initial five (5) year term commencing on June 1, 1994. Wellhead
currently has the option to purchase the facilities for the sum of $274,000 and
an amount as determined by a formula set forth in the purchase option relating
to an addition built to the facilities. The exercise price as of October 1, 1997
was approximately $385,000. The lease was executed in connection with the
acquisition of WRI, Inc.

Wellhead has executed an Installment Note dated July 30, 1996 (the
"Espinosa Note"), payable to the order of J. Richard Espinosa in the principal
amount of $135,000, together with interest at the annual rate of 1 1/4% over the
prime rate established from time to time by Texas Commerce Bank. This Note
represents a refinancing of the note originally issued in connection with the
acquisition of WRI, Inc. Principal payments of $5,625 plus accrued interest are
due and payable in monthly installments with the first installment beginning on
August 1, 1996, with remaining installments of principal plus accrued interest
on the first day of each succeeding calendar month thereafter until the
expiration of twenty-four (24) months. Wellhead has also, pursuant to a loan
made by Mr. Espinosa to Wellhead, executed a Promissory Note dated January 1,
1998, payable to the order of Richard Espinosa in the approximate principal
amount of $98,000, together with interest at the annual rate of 9%. The unpaid
principal and accrued interest of the Promissory Note is due and payable in full
on December 31, 1998.

Wellhead has, pursuant to a loan made by Mr. Dueitt to Wellhead, executed a
Promissory Note dated January 1, 1998, payable to the order of Alvin H. Dueitt
in the approximate principal amount of $103,000, together with interest at the
annual rate of 9%. The unpaid principal and accrued interest of the Promissory
Note is due and payable in full on December 31, 1998.

Certain directors and officers of the Founding Companies have acted as
guarantors or co-makers with respect to indebtedness previously incurred by the
Founding Companies. Wallace C. Sparkman, who formerly held a significant equity
interest in Wellhead and Flare King and served as an executive officer and
director of each of the Founding Companies, retired as a director and officer of
each of the Founding Companies effective October 22, 1997. Mr. Sparkman had
previously (i) absolutely and unconditionally guaranteed all of the indebtedness
of Wellhead under that $700,000 Loan Agreement (the "$700,000 Loan Agreement)
dated January 16, 1997 with Community National Bank, Midland, Texas; (ii)
absolutely and unconditionally guaranteed all of the indebtedness of Hi-Tech
under (a) the $425,000 Loan Agreement (the "$425,000 Loan Agreement") dated
October 1, 1996 with Norwest Bank Texas, Midland, N.A. ("Norwest Bank") and
(b) the $250,000 Loan Agreement (the "$250,000 Loan Agreement") dated May 1,
1997 with

33
<PAGE>

Norwest Bank; (iii) signed as a co-maker along with Flare King (a) the $150,000
Commercial Revolving Note dated June 19, 1997 with Midland American Bank,
Midland, Texas ("Midland Bank") and (b) the $125,000 Commercial Draw Note
dated June 19, 1997 with Midland Bank (the Notes described in clause (iii)(a)
and (iii)(b) being the "Midland Notes"); (iv) absolutely and unconditionally
guaranteed Wellhead's payment of the Espinosa Note; and (v) unconditionally
guaranteed Flare King's payment of a Promissory Note dated June 16, 1997, in the
principal amount of $65,502, payable to Robert Chambers. The Midland Notes will
be paid out of the net proceeds of the Offering (see "Use of Proceeds"), and
Mr. Sparkman, as comaker of the Midland Notes, will have no further obligation
under the Midland Notes. Although Mr. Sparkman has been instrumental in
negotiating the Reorganization and the Offering and may therefore be considered
a promoter of the Company, Mr. Sparkman has transferred all of his interests in
Wellhead and Flare King to Diamente Investments, L.P., a Texas limited
partnership in which Mr. Sparkman and his wife are the only general and limited
partners (the "Partnership"). Mr. Sparkman will not receive any compensation
in connection with the Reorganization or the Offering, but the Partnership will
receive, along with and on the same basis as other equityholders of Wellhead and
Flare King, shares of the Company in exchange for the shares it holds in
Wellhead and Flare King. The Partnership has executed an irrevocable proxy in
favor of the Chairman of the Board of Directors of the Company with respect to
its shares of capital stock of the Company to be issued in the Reorganization.
If a majority of the Board of Directors is made up of independent directors, the
Chairman (or other authorized designee) will vote such shares in accordance with
the direction of a majority of the directors in attendance at such meeting. If a
majority of the Board of Directors is not made up of independent directors, the
Chairman (or other authorized designee) will vote such shares in accordance with
the direction of a majority of the independent directors in attendance at such
meeting. By its terms, the proxy will expire at such time as the Partnership's
ownership interest in the Company represents less than five percent of the
Company's outstanding common stock. Mr. Sparkman will not continue any
affiliation as an officer or director of the Founding Companies and will not be
an officer or director of the Company. Until the consummation of the
Reorganization and the Offering, he will remain an employee of the Company to
assist with transitional matters. Thereafter, the Board of Directors intends to
engage Mr. Sparkman as a consultant to the Company on transitional issues and
otherwise project by project as deemed appropriate, including with respect to
potential acquisitions. Mr. Sparkman has indicated that he will make himself
available on such basis.

Mr. Sparkman has executed a note in favor of Flare King in satisfaction and
discharge of his obligations under a renewal and extension of that certain
Variable Rate Revolving Line of Credit Note dated July 8, 1993. The note, in the
outstanding principal amount of approximately $91,000, bears interest at the
rate of 8.5% per annum and is due in full on January 21, 1999.

Alvin H. Dueitt, a director and President of the Company and Chief
Executive Officer of Wellhead, and Martin L. Tomlin, Vice President of Wellhead,
have also absolutely and unconditionally guaranteed all of the indebtedness of
Wellhead under the $700,000 Loan Agreement. Wayne L. Vinson, President of Hi-
Tech, has also absolutely and unconditionally guaranteed all of the indebtedness
of Hi-Tech under the $425,000 Loan Agreement and the $250,000 Loan Agreement.

In connection with the Reorganization, and as consideration for their
interests in the Founding Companies, certain officers and directors of the
Company will receive shares of Common Stock of the Company. See
"Reorganization."

Francis M. Ricci serves as a director of the Company and as a consultant to
the Underwriter, to whom the Company has certain ongoing obligations. See
"Underwriting."

COMPANY POLICY

The Company believes that the terms of the transactions described in the
preceding section were equivalent to those that could have been obtained from
unaffiliated third parties and the Board of Directors has ratified such
transactions. The Company's Bylaws provide that transactions with affiliated
parties be approved by a majority of the Board of Directors, including a
majority of the disinterested members of the Board of Directors, and that such
transactions be on terms no less favorable than those that are deemed by

34
<PAGE>

the Board of Directors to be equivalent to those the Company could obtain from
unaffiliated third parties. Of the five members of the Board of Directors, four
are independent directors who are neither officers nor employees of the Company
and do not have a material business or professional relationship with the
Company except as directors and with respect to Mr. Sellers, who will receive
shares of common stock of the Company in the Reorganization. The Company intends
to nominate and recommend for election by the shareholders at each annual
meeting of shareholders such number of independent directors as will ensure that
the Board of Directors has at all times at least two independent members.

SECURITIES OWNERSHIP OF MANAGEMENT
AND CERTAIN BENEFICIAL HOLDERS

The following table sets forth information as of the effective date of the
Reorganization regarding the beneficial ownership of the Common Stock, after
giving effect to the Reorganization and the Offering, by (i) each director, (ii)
each named executive officer, (iii) all executive officers and directors as a
group and (iv) each person known to be the beneficial owner (as defined in Rule
13d-3 of the Securities Exchange Act of 1934, as amended) of more than 5% of the
outstanding shares of Common Stock. All persons listed have an address c/o the
Company's principal executive offices and have sole voting and investment power
with respect to their shares unless otherwise indicated.

SHARES BENEFICIALLY
OWNED
AFTER REORGANIZATION
AND OFFERING
-----------------------
NUMBER PERCENT
----------- -------
Diamente Investments, L.P./Wallace C.
and Patsy Sparkman(1).............. 745,276 17.67%
Alvin H. Dueitt...................... 650,185 15.41%
Wallace O. Sellers(2)................ 472,227 11.19%
Martin L. Tomlin..................... 642,582 15.23%
J. Richard Espinosa.................. 64,321 1.52%
L. Melvin Cooper.....................
Charles K. Miller, Jr................
Francis M. Ricci.....................
All directors and executive officers
as a group (11 persons)............ 1,834,384 43.48%

- ------------

(1) The Partnership is a Texas limited partnership in which Wallace C. Sparkman
and his spouse, Patsy Sparkman, are the only general and limited partners.
The Partnership and the general partners have investment power with respect
to the shares of the Company owned by the Partnership. The Partnership has
executed an irrevocable proxy in favor of the Chairman of the Board of
Directors of the Company with respect to such shares. See "Certain
Transactions." The address of the Partnership is 205 Del Mar, Corpus
Christi, Texas 78404.

(2) Includes 90,112 shares to be received in the Reorganization by Ms. Sellers.

35
<PAGE>
DESCRIPTION OF SECURITIES

GENERAL

The authorized capital stock of the Company consists of 25,000,000 shares
of common stock, par value $.01 per share, and 5,000,000 shares of preferred
stock, par value $.01 per share. After giving effect to the Reorganization, but
without giving effect to the Offering, the Company will have outstanding
3,118,750 shares of common stock and no shares of preferred stock. Giving effect
to the Offering, the Company will have outstanding 4,218,750 shares of common
stock and no shares of preferred stock.

The following discussion is qualified in its entirety by reference to the
Articles of Incorporation and the Bylaws of the Company, which are included as
exhibits to the Registration Statement of which this Prospectus is a part.

COMMON STOCK

Holders of Common Stock are entitled to one vote per share on any matter
submitted to the vote of shareholders. Shareholders elect only one-third of the
members of the Board of Directors in any given year, each director serving for a
term of three years. See "Risk Factors -- Anti-Takeover Measures" for a
discussion of the classified board and other terms of the Charter Documents
having an anti-takeover effect. Subject to preferential rights with respect to
preferred stock and any other stock ranking prior to Common Stock as to
dividends, holders of Common Stock are entitled to receive ratably such
dividends, if any, as may be declared from time to time by the Board of
Directors out of funds legally available therefor. See "Dividend Policy." In
the event of any liquidation, dissolution or winding up of the Company, whether
voluntary or involuntary, holders of Common Stock are entitled to share ratably
in all assets remaining after payment of the debts and other liabilities and the
liquidation preference of any stock ranking prior to Common Stock. Holders of
Common Stock have no preemptive rights to purchase shares of stock of the
Company. Shares of Common Stock are not subject to any redemption or sinking
fund provisions and are not convertible into any other securities of the
Company. In addition, the rights of the holders of Common Stock will be subject
to, and may be adversely affected by, the rights of any holders of preferred
stock which may be issued in the future and that may be senior to the rights of
the holders of Common Stock. The shares of Common Stock presently outstanding
are, and the shares of Common Stock to be issued in the Reorganization and the
shares of Common Stock offered hereby when issued will be, fully paid and
nonassessable.

PREFERRED STOCK

Subject to the provisions of the Company's Articles of Incorporation and
limitations prescribed by law, the Board of Directors is expressly authorized to
issue one of more series of preferred stock, to fix by resolution with respect
to the issue of each series the preferences, limitations and relative rights of
such series including without limitation, the following: (i) the number of
shares of any series and to change the number of shares constituting any series,
(ii) the dividend rights of any series, the preferences, if any, over any other
class or series of stock, or of any other class or series of stock over such
series, as to dividends, the extent, if any to which shares of any series will
be entitled to participate in dividends with shares of any other series or class
of stock, whether dividends on shares of any series will be fully, partially or
conditionally cumulative, or a combination thereof, and limitations or
restrictions thereof, (iii) the rights of any series, and the preferences, if
any, over any other class or series, or of any other class or series over such
series, in the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and the extent to which shares of any series will be
entitled to participate with any other series or class; (iv) the terms of
redemption and redemption prices; (v) the terms of any purchase, retirement or
sinking fund; (vi) the terms of conversion or exchangability rights; and (vii)
the voting powers of any series. The Company has no current plans to issue any
shares of preferred stock and will not in any event issue preferred stock to
former equityholders of the Founding Companies except on the same terms as such
preferred stock may be offered to all shareholders of the Company in existence
at the time such shares are issued.

36
<PAGE>
One of the effects of undesignated preferred stock may be to enable the
Board of Directors to render more difficult or to discourage an attempt to
obtain control of the Company by means of a tender offer, proxy contest, merger
or otherwise, and thereby to protect the continuity of the Company's management.
The issuance of shares of preferred stock pursuant to the Board of Directors'
authority described above may adversely affect the rights of the holders of
Common Stock. For example, preferred stock issued by the Company may rank prior
to the Common Stock as to dividend rights, liquidation preference or both, may
have full or limited voting rights and may be convertible into shares of Common
Stock. Accordingly, the issuance of shares of preferred stock may discourage
bids for the Common Stock or may otherwise adversely affect the market price of
the Common Stock. See also "Risk Factors -- Anti-Takeover Measures."

WARRANTS TO PURCHASE COMMON STOCK

Upon successful completion of the Offering, the Company will grant to the
Underwriter for a purchase price of $100 warrants to purchase 110,000 shares of
Common Stock at an exercise price of 130% of the offering price. The warrants
may not be transferred, except to or among officers of the Underwriter or by
operation of law or to a successor of the business of the Underwriter for a
period of one year following the effective date of the Offering and will be
exercisable at any time during a four-year period beginning one year after the
effective date of the Offering. The Underwriter may request the Company upon 60
days written notice to register the shares issuable upon exercise of such
warrants under the Securities Act, and if requested the Company will at its
expense prepare and file a registration statement within 60 days.

LIMITATION ON LIABILITY AND INDEMNIFICATION OF OFFICERS AND DIRECTORS

Pursuant to the Company's Articles of Incorporation and as permitted by
Texas law, directors of the Company are not liable to the Company or its
stockholders for monetary damages for breach of fiduciary duty, except for
liability in connection with a breach of duty of loyalty, for acts or omissions
not in good faith or which involve intentional misconduct or a knowing violation
of law, for any transaction in which a director has received an improper benefit
or for acts or omissions for which the liability of a director is expressly
provided for by statute.

The Company's Articles of Incorporation and Bylaws provide that the Company
shall indemnify directors of the Company to the fullest extent permitted by the
Texas Business Corporation Act. The Company has also entered into
indemnification agreements with its directors and officers covering the matters
provided for in the Bylaws and intends to obtain insurance with respect to such
indemnification.

TRANSFER AGENT AND REGISTRAR

The Transfer Agent and Registrar for the Common Stock is American
Securities Transfer & Trust, Inc.

SHARES ELIGIBLE FOR FUTURE SALE

After effecting the Reorganization and upon completion of the Offering, the
Company will have 4,218,750 shares of Common Stock outstanding. In addition, the
Company may issue up to 110,000 shares upon exercise of the warrants granted to
the Underwriters in connection with the Offering. Of these shares, the shares
sold in the Offering will be freely tradeable without restriction under the
Securities Act, except that any shares acquired by "affiliates" of the
Company, as that term is defined in Rule 144 ("Rule 144") under the Securities
Act, may generally only be sold in compliance with the applicable provisions of
Rule 144. The remaining 3,118,750 shares of Common Stock (and any shares issued
pursuant to exercise of the warrants) outstanding after the Offering will be
issued without registration under the Securities Act and will, therefore, be
"restricted securities" within the meaning of Rule 144 and may not be sold in
a public distribution except in compliance with the registration requirements of
the Securities Act or an applicable exemption under the Securities Act,
including an exemption pursuant to Rule 144. Restricted securities are eligible
for sale in the public market pursuant to Rule 144 no sooner than one year from
the date of acquisition.

37
<PAGE>

In general, under Rule 144 a person (or persons whose shares are
aggregated) who has beneficially owned shares for at least one year is entitled
to sell in "broker's transactions" or to market makers, within any three-month
period commencing 90 days after the date of this Prospectus, a number of shares
that does not exceed the greater of: (i) one percent of the number of shares of
Common Stock then outstanding (approximately 4,218,750 shares immediately after
the Offering); or (ii) generally, the average weekly trading volume of the
Common Stock during the four preceding calendar weeks. Sales under Rule 144 are
also subject to requirements concerning the availability of certain public
information about the Company, restrictions on the manner of sale and notice
requirements. Under Rule 144(k), a person who is not deemed an affiliate of the
Company at any time during the three months preceding a sale, and who has
beneficially owned the shares proposed to be sold for at least two years, is
entitled to sell such shares without having to comply with the manner of sale,
public information, volume limitation or notice provisions of Rule 144.

The Company, its officers and directors and certain of its stockholders,
who will hold upon completion of the Offering approximately 74% of the
outstanding shares of Common Stock, have entered into contractual "lock-up"
agreements pursuant to which they have agreed that during the period beginning
from the date of the closing of the Offering and continuing and including the
twelve months thereafter, they will not offer, sell, contract to sell or
otherwise dispose of any shares of Common Stock, including without limitation
any securities that are convertible into or exchangeable for, or that represent
the right to receive, Common Stock without the prior written consent of the
Underwriter, except for the shares of Common Stock offered in connection with
the Offering and issuances of capital stock by the Company in connection with
potential future acquisitions, provided that the shares issuable pursuant to any
such acquisitions shall not be transferable before the end of the twelve month
period. As a result of these contractual restrictions, shares subject to lock-up
agreements cannot be sold until the agreements expire without the prior written
consent of the Underwriter.

Prior to the Offering, there has been no public market for the Common
Stock, and no prediction can be made as to the effect, if any, that market sales
of shares of Common Stock or the availability of such shares for sale to the
public will have on the market price for the Common Stock prevailing from time
to time. Sales of substantial amounts of Common Stock following the Offering
could adversely affect the market price of the Common Stock.

38
<PAGE>
UNDERWRITING

The Company has engaged the Underwriter to conduct an offering of its
Common Stock on a best efforts, all or none basis. The Offering is being made
without a firm commitment by the Underwriter, which has no obligation or
commitment to purchase any of the Common Stock. The Company has been advised by
the Underwriter that it proposes to offer the Common Stock to the public within
the price range shown on the cover page of this Prospectus and to certain
dealers at such price. The dealers will receive a portion of the commission not
in excess of $[ ]per share.

Prior to the Offering, there has been no public market for the Common Stock
of the Company. The initial public offering price for the Common Stock has been
determined through negotiations between the Company and the Underwriter. In
determining the offering price, the Company and the Underwriter considered such
factors as the Company's historic performance, the stage of its development as a
commercial enterprise, existing business relationships and the future potential
benefits of such relationships, its business plan, the size and condition of the
industry, its perception of potential market penetration and the financial
benefits that would result therefrom, the intended use of the proceeds of the
Offering, the financial resources of the Company, the amount of equity or
control desired to be retained by the Company's existing stockholders, the
amount of dilution to potential investors and the general condition of the
securities market.

Unless sooner withdrawn or canceled by either the Company or the
Underwriter, the Offering will continue until the earlier of the date on which
all the Common Stock offered hereby is sold or [ ], 1998 (which may be
extended to [ ], 1998). Until such date as the Offering is closed,
all proceeds from the sale of the Common Stock will be deposited in escrow with
Colorado State Bank and Trust (the "Escrow Agent"). Proceeds deposited in
escrow with the Escrow Agent may not be withdrawn by purchasers prior to the
closing or termination of the Offering. If the Offering is withdrawn, canceled
or terminated, all proceeds will be returned by the Escrow Agent without
interest or deduction to the persons from which they are received within five
business days after such withdrawal or cancellation.

Subject to the closing of the Offering, the Underwriter will receive a
non-accountable expense allowance equal to three percent of the amount raised in
the Offering. The Underwriter will further receive a commission of four percent
on sales of Common Stock to persons to whom the Company has referred the
Underwriter in writing (to a maximum of fifty percent of the Offering) and eight
and one-half percent on all other sales. The Underwriter is also receiving a fee
of $10,000 per month ($80,000 through December 1997) for financial advisory
services being provided to the Company. Such fee will be credited against the
Underwriter's nonaccountable expense allowance upon completion of the Offering.

Pursuant to the Underwriting Agreement, the obligations of the Underwriter
to solicit offers to purchase the shares and of investors solicited by the
Underwriter to purchase the Common Stock are subject to approval of certain
legal matters by counsel to the Underwriter and to various other conditions
which are customary in transactions of this type. Certain officers, directors
and major stockholders will also be subject to restrictions on their ability to
sell shares of Common Stock. See "Shares Eligible for Future Sale." The
Company has agreed to indemnify the Underwriter against certain liabilities,
including liabilities under the Securities Act.

Francis M. Ricci, a consultant to the Underwriter, serves as a director of
the Company. Mr. Ricci will receive $1,000 for each meeting of the Board of
Directors he attends.

The Underwriter does not intend to sell the Common Stock to any accounts
over which it exercises discretionary authority.

As additional underwriting compensation, the Company has granted to the
Underwriter for a purchase price of $100 warrants to purchase 110,000 (which
constitutes 10% of the shares to be sold in the Offering) shares at an exercise
price of 130% of the offering price. See "Description of Securities." The
warrants will be exercisable during the four-year period beginning one year
after issuance thereof.

39
<PAGE>
LEGAL MATTERS

The validity of the shares of Common Stock offered hereby is being passed
upon for the Company by Winstead Sechrest & Minick P.C., Houston, Texas. Certain
legal matters related to this Offering will be passed upon for the Underwriter
by Jones & Keller, P.C., Denver, Colorado.

EXPERTS

The audited financial statements of the Company and the Founding Companies
included in the Prospectus and Registration Statement have been audited by
Karlins Fuller Arnold & Klodosky, P.C., independent public accountants, as set
forth in their report. Such audited financial statements are included in
reliance upon the authority of such firm as experts in giving said reports.

ADDITIONAL INFORMATION

The Company has filed with the SEC a Registration Statement (which term
shall encompass any and all amendments thereto) on Form S-1 (the "Registration
Statement") under the Securities Act, with respect to the Common Stock offered
hereby. This Prospectus, which is part of the Registration Statement, does not
contain all the information set forth in the Registration Statement and the
exhibits and schedules thereto, certain items of which are omitted in accordance
with the rules and regulations of the SEC. Statements made in this Prospectus as
to the contents of any contract, agreement or other document referred to are not
necessarily complete. With respect to each such contract, agreement or other
document filed as an exhibit to the Registration Statement, reference is hereby
made to the exhibit for a more complete description of the matter involved, and
each such statement shall be deemed qualified in its entirety by such reference.
For further information with respect to the Company, reference is hereby made to
the Registration Statement and such exhibits and schedules filed as a part
thereof, which may be inspected, without charge, at the Public Reference Section
of the SEC at Room 1024, Judiciary Plaza, 450 Fifth Street N.W., Washington,
D.C. 20549, and at the regional offices of the SEC located at Seven World Trade
Center, 13th Floor, New York, New York 10048 and at Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. The SEC maintains a web
site that contains reports, proxy and information statements regarding
registrants that file electronically with the SEC. The address of this web site
is (http://www.sec.gov). Copies of all or any portion of the Registration
Statement may be obtained from the Public Reference Section of the SEC, upon
payment of the prescribed fees.

<PAGE>
INDEX TO FINANCIAL STATEMENTS

PAGE
----
UNITED OILFIELD SERVICES, INC. PRO
FORMA COMBINED FINANCIAL STATEMENTS
Basis of Presentation........... F-2
Unaudited Pro Forma Combined
Balance Sheet September 30,
1997........................... F-3
Unaudited Pro Forma Combined
Statement of Operations For the
Nine Months Ended September
30, 1997....................... F-4
Unaudited Pro Forma Combined
Statement of Operations for the
Nine Months Ended September 30,
1996........................... F-5
Unaudited Pro Forma Combined
Statement of Operations For the
Year Ended December 31,
1996........................... F-6
Notes to Unaudited Pro Forma
Combined Financial
Statements..................... F-7
UNITED OILFIELD SERVICES, INC.
FINANCIAL STATEMENT
Independent Auditor's Report.... F-9
Balance Sheet................... F-10
Notes to Balance Sheet.......... F-11
UNITED WELLHEAD SERVICES, INC.
FINANCIAL STATEMENTS
Independent Auditor's Report.... F-12
Consolidated Balance Sheets..... F-13
Consolidated Statements of
Operations..................... F-14
Consolidated Statements of
Stockholders' Equity........... F-15
Consolidated Statements of Cash
Flows.......................... F-16
Notes to Consolidated Financial
Statements..................... F-17
FLARE KING, INC. FINANCIAL STATEMENTS
Independent Auditor's Report.... F-24
Balance Sheets.................. F-25
Statements of Operations........ F-26
Statements of Stockholders'
Equity......................... F-27
Statements of Cash Flows........ F-28
Notes to Financial Statements... F-29
HI-TECH COMPRESSOR COMPANY, L.C.
FINANCIAL STATEMENTS
Independent Auditor's Report.... F-35
Balance Sheets.................. F-36
Statements of Operations........ F-37
Statements of Members'
Capital........................ F-38
Statements of Cash Flows........ F-39
Notes to Financial Statements... F-40

F-1
<PAGE>
UNITED OILFIELD SERVICES, INC. AND FOUNDING COMPANIES
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

BASIS OF PRESENTATION

The following unaudited pro forma combined financial statements give effect
to the acquisitions by United Oilfield Services, Inc. (the "Company") of the
outstanding capital stock of United Wellhead Services, Inc. ("Wellhead") and
Flare King, Inc. ("Flare King") and the membership interests of Hi-Tech
Compressor Company, L.C. ("Hi-Tech"). These acquisitions (the
"Reorganization") will occur simultaneously with and as a condition to the
consummation of the offering by the Company of 1,100,000 shares of its common
stock (the "Offering") and will be accounted for using the purchase method of
accounting.

The unaudited pro forma combined balance sheet gives effect to the
Reorganization and Offering as if they had occurred on September 30, 1997. The
unaudited pro forma combined statements of operations give effect to the
Reorganization and the Offering as if they had occurred on January 1, 1996.

The pro forma adjustments (Reorganization and Offering) are based on
estimates, available information and certain assumptions and may be revised as
additional information becomes available. The pro forma financial data does not
purport to represent what the Company's financial position or results of
operations would actually have been if such transactions had in fact occurred on
those dates and are not necessarily representative of the Company's financial
position or results of operations of the Company for any future period.
Historical combined results may not be comparable to or indicative of future
performance. The unaudited pro forma combined financial statements should be
read in conjunction with the historical Financial Statements of the Company and
the individual Founding Companies and notes thereto included elsewhere in this
Prospectus.

F-2
<PAGE>

UNITED OILFIELD SERVICES, INC.
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
SEPTEMBER 30, 1997
(IN THOUSANDS)
<TABLE>
<CAPTION>
PRO FORMA
PRO FORMA AS ADJUSTED--
REORGANIZATION REORGANIZATION
COMPANY WELLHEAD FLARE KING HI-TECH ADJUSTMENTS ONLY
------- -------- ---------- ------- -------------- -------------
<S> <C> <C> <C> <C>
ASSETS
Current Assets
Cash................................ $ $ 264 $ 11 $ 14 $ $ 289
Accounts and notes receivable,
net............................... 2,541 227 213 (13)(3) 2,968
Inventory........................... 1,135 52 180 1,367
Prepaid expenses.................... 93 33 29 155
Deferred income taxes............... 25 25
------- -------- ---------- ------- -------------- -------------
Total current assets............ 4,058 323 436 (13) 4,804
------- -------- ---------- ------- -------------- -------------
Property, plant and equipment, at
cost.................................. 1,542 281 373 2,196
Less accumulated depreciation and
amortization...................... (1,034) (167) (96) (1,297)
------- -------- ---------- ------- -------------- -------------
508 114 277 899
------- -------- ---------- ------- -------------- -------------
Other Assets
Investments......................... 45 90 6 (90)(3) 51
Prepaid offering costs.............. 165 165
Intangible assets, net.............. 34 287 2,188 (4) 2,509
Other assets........................ 1 2 4 7
Deferred income taxes............... 96 96
------- -------- ---------- ------- -------------- -------------
Total other assets.............. 1 340 379 10 2,098 2,828
------- -------- ---------- ------- -------------- -------------
Total assets.................... $ 1 $ 4,906 $ 816 $ 723 $ 2,085 $ 8,531
======= ======== ========== ======= ============== =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current portion of long-term debt... $ $ 376 $ 166 $ 314 $ $ 856
Accounts payable, trade............. 659 40 50 (13)(3) 736
Accrued liabilities................. 825 39 8 872
Income tax payable.................. 463 463
------- -------- ---------- ------- -------------- -------------
Total current liabilities....... 2,323 245 372 (13) 2,927
------- -------- ---------- ------- -------------- -------------
Long term debt.......................... 977 178 175 1,330
------- -------- ---------- ------- -------------- -------------
Stockholders' Equity
Common stock........................ 1 479 111 (560)(1) 31
Additional paid-in capital.......... 375 2,748 (1) 3,123
Retained earnings (deficit)......... 1,127 (93) 176 (90)(3) 1,120
------- -------- ---------- ------- -------------- -------------
Total stockholders' equity...... 1 1,606 393 176 2,098 4,274
------- -------- ---------- ------- -------------- -------------
Total liabilities and
stockholders' equity.......... $ 1 $ 4,906 $ 816 $ 723 $ 2,085 $ 8,531
======= ======== ========== ======= ============== =============
</TABLE>
PRO FORMA
PRO FORMA AS ADJUSTED--
OFFERING REORGANIZATION
ADJUSTMENTS AND OFFERING
----------- -------------
ASSETS
Current Assets
Cash................................ $4,464 (1)(2) $ 4,753
Accounts and notes receivable,
net............................... 2,968
Inventory........................... 1,367
Prepaid expenses.................... 155
Deferred income taxes............... 25
----------- -------------
Total current assets............ 4,464 9,268
----------- -------------
Property, plant and equipment, at
cost.................................. 2,196
Less accumulated depreciation and
amortization...................... (1,297)
----------- -------------
899
----------- -------------
Other Assets
Investments......................... 51
Prepaid offering costs.............. (165)(1)
Intangible assets, net.............. 2,509
Other assets........................ 7
Deferred income taxes............... 96
----------- -------------
Total other assets.............. (165) 2,663
----------- -------------
Total assets.................... $ 4,299 $ 12,830
----------- -------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current portion of long-term debt... $ (207)(2) $ 649
Accounts payable, trade............. 736
Accrued liabilities................. 872
Income tax payable.................. 463
----------- -------------
Total current liabilities....... (207) 2,720
----------- -------------
Long term debt.......................... (973)(2) 357
----------- -------------
Stockholders' Equity
Common stock........................ 11 (1) 42
Additional paid-in capital.......... 5,468 (1) 8,591
Retained earnings (deficit)......... 1,120
----------- -------------
Total stockholders' equity...... 5,479 9,753
----------- -------------
Total liabilities and
stockholders' equity.......... $ 4,299 $ 12,830
=========== =============

F-3
<PAGE>

UNITED OILFIELD SERVICES, INC.
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
WELLHEAD FLARE KING HI-TECH ADJUSTMENTS AS ADJUSTED
-------- ---------- ------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues................................ $ 8,052 $ 902 $ 566 $ $ 9,520
Cost of goods sold...................... 4,580 471 370 5,421
-------- ---------- ------- ----------- -----------
Gross profit............................ 3,472 431 196 4,099
Selling, general and administrative
expenses.............................. 1,666 264 110 2,040
Depreciation and amortization expense... 95 54 31 110 (5) 290
-------- ---------- ------- ----------- -----------
1,761 318 141 110 2,330
-------- ---------- ------- ----------- -----------
Income from operations.................. 1,711 113 55 (110) 1,769
Income from unconsolidated subsidiary... 17 (17)(6)
Other income (expense), net............. (20) 3 (17)
Interest expense........................ (36) (25) (24) 15 (7) (70)
-------- ---------- ------- ----------- -----------
(56) (8) (21) (2) (87)
-------- ---------- ------- ----------- -----------
Income before income tax provision...... 1,655 105 34 (112) 1,682
Income tax provision.................... (616) (40) (5) (661)
-------- ---------- ------- ----------- -----------
Net income.............................. $ 1,039 $ 65 $ 29 $ (112) $ 1,021
======== ========== ======= =========== ===========
Net income per common share............. $ 0.31

Shares used in computing pro forma net
income per common share(8)............ 3,305,583
</TABLE>

F-4
<PAGE>

UNITED OILFIELD SERVICES, INC.
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
WELLHEAD FLARE KING HI-TECH ADJUSTMENTS AS ADJUSTED
-------- ---------- ------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues................................ $ 5,399 $ 742 $ 854 $ $ 6,995
Cost of goods sold...................... 3,357 343 614 4,314
-------- ---------- ------- ----------- -----------
Gross profit............................ 2,042 399 240 2,681
Selling, general and administrative
expenses.............................. 1,407 230 106 1,743
Depreciation and amortization
expenses.............................. 82 36 23 110 (5) 251
-------- ---------- ------- ----------- -----------
1,489 266 129 110 1,994
-------- ---------- ------- ----------- -----------
Income from operations.................. 553 133 111 (110) 688
Income from unconsolidated subsidiary... 34 (34)(6)
Other income (expense), net............. 2 1 (11) (8)
Interest expense........................ (28) (24) (33) 15 (7) (70)
-------- ---------- ------- ----------- -----------
(26) 11 (44) (19) (78)
-------- ---------- ------- ----------- -----------
Income before income tax provision...... 527 144 67 (129) 610
Income tax provision.................... (179) (35) (12) (226)
-------- ---------- ------- ----------- -----------
Net income.............................. $ 348 $ 109 $ 55 $ (129) $ 384
======== ========== ======= =========== ===========
Net income per common share............. $ 0.12

Shares used in computing pro forma net
income per common share(8)............ 3,305,583
</TABLE>

F-5
<PAGE>
UNITED OILFIELD SERVICES, INC.
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
WELLHEAD FLARE KING HI-TECH ADJUSTMENTS AS ADJUSTED
-------- ---------- ------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues................................ $ 8,011 $ 1,034 $ 1,108 $ $ 10,153
Cost of goods sold...................... 5,160 542 736 6,438
-------- ---------- ------- ----------- -----------
Gross profit............................ 2,851 492 372 3,715
Selling, general and administrative
expenses.............................. 2,082 353 174 2,609
Depreciation and amortization
expenses.............................. 116 73 32 146 (5) 367
-------- ---------- ------- ----------- -----------
2,198 426 206 146 2,976
-------- ---------- ------- ----------- -----------
Income from operations.................. 653 66 166 (146) 739
Income from unconsolidated subsidiary... 73 (73)(6)
Other income (expense), net............. (54) 54 (3) (3)
Interest expense........................ (36) (48) (16) 26 (7) (74)
-------- ---------- ------- ----------- -----------
(90) 79 (19) (47) (77)
-------- ---------- ------- ----------- -----------
Income before income tax provision...... 563 145 147 (193) 662
Income tax provision.................... (257) (32) (289)
-------- ---------- ------- ----------- -----------
Net income.............................. $ 306 $ 113 $ 147 $ (193) $ 373
======== ========== ======= =========== ===========
Net income per common share............. $ 0.11

Shares used in computing pro forma net
income per common share(8)............ 3,305,583
</TABLE>

F-6
<PAGE>
UNITED OILFIELD SERVICES, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

GENERAL

The Company was founded to become a diversified energy service and
manufacturing company through the combination of Wellhead, Flare King and
Hi-Tech (the "Founding Companies"). The Company provides a variety of services
and equipment to the exploration, production and transmission sectors of the oil
and gas industry. The Founding Companies are engaged principally in the business
of manufacturing and reconditioning wellhead equipment for the oil and gas
industry, mainly the drilling and exploration segment (Wellhead), the
manufacture of flare tips and ignition systems for plant production facilities
(Flare King), and the assembling of rotary screw compressor units to enhance the
production of oil and gas wells (Hi-Tech).

In April of 1997, the Founding Companies signed a "Letter of Intent" with
D. E. Frey & Company, Inc. which provided for the Founding Companies'
stockholders to exchange their shares through a business combination to form the
Company, in contemplation of an initial public offering (the "Offering") on a
"best efforts basis."

Effective as of October 14, 1997 Wellhead and the equity holders of the
Founding Companies entered into an Agreement and Plan of Reorganization, which
was subsequently amended. Pursuant to such agreement and simultaneously with and
as a condition to the closing of such agreement and the Offering, the Company
will issue to the holders (other than one of the Founding Companies) of the
outstanding equity interests in the Founding Companies shares of its Common
Stock in exchange for such equity interests (the "Reorganization").

The historical financial statements reflect the financial position of the
Company and the Founding Companies and the results of operations of the Founding
Companies and were derived from the respective separate historical financial
statements. The periods included in these financial statements for the
individual Founding Companies are as of and for the nine months ended September
30, 1996 and 1997 and for the twelve months ended December 31, 1996. The balance
sheet includes information on the Company at the date of its inception. The
audited historical financial statements included elsewhere herein have been
included in accordance with Securities and Exchange Commission ("SEC") Staff
Accounting Bulletin No. 80.

ACQUISITION OF FOUNDING COMPANIES

The Company is acquiring the Founding Companies in a transaction in which
Wellhead is deemed the "Accounting Acquiror" and the acquisition of Flare King
and Hi-Tech is accounted for on the purchase method of accounting. Wellhead is
deemed the Accounting Acquiror because, among other reasons, shareholders of
Wellhead will receive in the Reorganization 85% of the voting stock of the
combined Company without including the shares to be issued pursuant to the
Offering and 65% if such shares are included. Based upon management's analysis,
the historical carrying value of Flare King's and Hi-Tech's assets and
liabilities substantially approximate fair value.

The following table sets forth the consideration to be paid in shares of
Common Stock to the stockholders and members of each of the Founding Companies.

SHARES OF VALUE OF
COMMON STOCK SHARES(1)
------------ --------------
Wellhead............................. 2,659,175 $ 11,966,288
Flare King........................... 304,316 1,369,422
Hi-Tech.............................. 155,259 698,666
------------ --------------
3,118,750 $ 14,034,376
============ ==============

F-7
<PAGE>
UNITED OILFIELD SERVICES, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

- ------------

(1) Value has been determined based on an initial offering price of $6.00 per
share, less a discount of 25% based on restrictions on the sale and
transferability of the shares issued.

PRO FORMA ADJUSTMENTS

BALANCE SHEET

(1) Records the gross proceeds of $6,600,000 (based on an initial public
offering price of $6 per share) from the issuance of shares of Common Stock, net
of offering costs of $956,000 ($1,121,000 total estimated offering costs less
prepaid offering expenses of $165,000). Offering costs primarily consist of
underwriting commissions, fees and expenses, accounting fees, legal fees and
printing expenses.

(2) Records $1,180,000 used to retire a $960,000 note issued in August
1997 to retire redeemable preferred stock and $220,000 of other debt.

(3) Eliminates intercompany investment and balances.

(4) Records the purchase by Wellhead of Flare King and Hi-Tech consisting
of 459,575 shares of Common Stock valued at $6.00 per share or $2,757,450,
resulting in excess purchase price of $2,188,450 over the net assets acquired of
$569,000.

STATEMENTS OF OPERATIONS

(5) Records pro forma goodwill amortization expense over a 15-year
estimated life based upon cash flow projections and comparable industry data.

(6) Eliminates Flare King's income in its 50% ownership in Hi-Tech.

(7) Records anticipated reduction in interest expense due to reduction of
outstanding indebtedness.

ADDITIONAL PRO FORMA INFORMATION

(8) Shares used in computing pro forma net income include 3,118,750
shares issued to owners of the Founding Companies and 186,833 of the 1,100,000
shares sold in the Offering necessary to pay the expenses of this Offering
(based on an offering price of $6.00 per share). The remaining 913,167 shares
reflect the net cash proceeds to the Company.

(9) Differences in totals result from variances in rounding dollar amounts
to the nearest thousand. Amounts $500 and greater have been rounded up. Amounts
under $500 have been rounded down.

F-8

<PAGE>
INDEPENDENT AUDITOR'S REPORT

To the Stockholder and Directors of
UNITED OILFIELD SERVICES, INC.
Corpus Christi, Texas

We have audited the accompanying balance sheet of UNITED OILFIELD SERVICES,
INC. as of October 20, 1997 (date of inception). This balance sheet is the
responsibility of the Company's management. Our responsibility is to express an
opinion on this balance sheet based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the balance sheet is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the balance sheet. An audit also includes
assessing the accounting princples used and significant estimates made by
management, as well as evaluating the overall balance sheet presentation. We
believe that our audit provides a reasonable basis for our opinion.

In our opinion, the balance sheet referred to above presents fairly, in all
material respects, the financial position of UNITED OILFIELD SERVICES, INC. at
October 20, 1997 (date of inception) in conformity with generally accepted
accounting principles.

/s/__KARLINS FULLER ARNOLD & KLODOSKY, P.C.
The Woodlands, Texas
December 23, 1997

F-9
<PAGE>

UNITED OILFIELD SERVICES, INC.
BALANCE SHEET
OCTOBER 20, 1997
(DATE OF INCEPTION)

ASSETS
OTHER ASSETS
Organizational costs............... $ 1,000
---------
$ 1,000
=========

STOCKHOLDER'S EQUITY
STOCKHOLDER'S EQUITY
Preferred stock $.01 par value,
5,000,000 shares authorized, no
shares issued................... $ --
Common stock, $.01 par value,
25,000,000 shares authorized and
200 shares issued............... 1,000
---------
$ 1,000
=========

The accompanying notes are an integral part of this Balance Sheet.

F-10
<PAGE>

UNITED OILFIELD SERVICES, INC.
NOTES TO BALANCE SHEET
OCTOBER 20, 1997
(DATE OF INCEPTION)

NOTE A BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

LINES OF BUSINESS -- United Oilfield Services, Inc. ("United Oilfield
Services" or "the Company") was founded to become a diversified energy
service and manufacturing company through the combination of United Wellhead
Services, Inc. ("Wellhead"), Flare King Inc. and Hi-Tech Compressor Company,
L.C. (the "Founding Companies"). The Company will provide a variety of
services and equipment to the exploration, production and transmission sectors
of the oil and gas industry. The Founding Companies are engaged principally in
the business of manufacturing and reconditioning wellhead equipment for the oil
and gas industry, mainly the drilling and exploration segment (United Wellhead
Services, Inc.), the manufacture of flare tips and ignition systems for plant
production facilities (Flare King, Inc.), and the assembling of rotary screw
compressor units to enhance the production of oil and gas wells (Hi-Tech
Compressor Company, L.C.).

NOTE B STOCKHOLDER'S EQUITY

In connection with its organization and initial capitalization, the Company
issued 200 shares of common stock for $1,000 to the Company's president in
exchange for preorganization services rendered on behalf of the Company. The
Company's president has agreed to contribute the shares to the Company for
cancellation upon consummation of the Offering and the Reorganization.

NOTE C REORGANIZATION

F-11
<PAGE>
INDEPENDENT AUDITOR'S REPORT

To the Stockholders and Directors of
UNITED WELLHEAD SERVICES, INC.
Corpus Christi, Texas

We have audited the accompanying consolidated balance sheets of UNITED
WELLHEAD SERVICES, INC. and subsidiary as of December 31, 1995 and 1996 and the
related consolidated statements of operations, stockholders' equity, and cash
flows for each of the three years in the period ended December 31, 1996. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the consolidated financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of UNITED
WELLHEAD SERVICES, INC. and subsidiary at December 31, 1995 and 1996, and the
results of their operations and cash flows for each of the three years in the
period ended December 31, 1996, in conformity with generally accepted accounting
principles.

/s/ KARLINS FULLER ARNOLD & KLODOSKY, P.C.

(SUCCESSORS TO THE PRACTICE OF KARLINS, PATRICK & CO., P.C.
WHO AUDITED THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
DECEMBER 31, 1995 AND 1994)
The Woodlands, Texas
March 3, 1997 except for Note L,
as to which the dates are April 11, 1997 and December 23, 1997

F-12
<PAGE>
UNITED WELLHEAD SERVICES, INC.
CONSOLIDATED BALANCE SHEETS

DECEMBER 31,
-------------------------- SEPTEMBER 30,
1995 1996 1997
------------ ------------ -------------
(UNAUDITED)
ASSETS
Current Assets
Cash........................... $ 22,707 $ 369,490 $ 264,384
Accounts receivable, trade, net
of allowance of $11,000,
$10,000 and $7,365........... 818,482 2,089,309 2,541,380
Inventory...................... 683,217 738,692 1,135,169
Prepaid expenses............... 79,186 46,733 91,369
Deferred income taxes.......... 26,695 25,113 25,113
------------ ------------ -------------
Total current assets...... 1,630,287 3,269,337 4,057,415
------------ ------------ -------------
Property, Plant and Equipment, at
cost................................ 1,287,042 1,387,135 1,542,491
Less accumulated depreciation
and amortization............. 892,333 973,028 1,034,125
------------ ------------ -------------
394,709 414,107 508,366
------------ ------------ -------------
Other Assets
Investments.................... 40,104 44,169 45,177
Prepaid offering costs......... 165,250
Intangible assets, net......... 70,410 49,440 33,713
Deferred income tax............ 179,827 120,832 95,627
------------ ------------ -------------
290,341 214,441 339,767
------------ ------------ -------------
$ 2,315,337 $ 3,897,885 $ 4,905,548
============ ============ =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Notes payable.................. $ 185,000 $ 140,559 $ 83,550
Current portion of long-term
debt......................... 92,074 169,739 291,833
Accounts payable, trade........ 350,882 977,259 659,211
Accrued liabilities............ 274,774 561,979 824,586
Income tax payable............. 175,000 463,126
------------ ------------ -------------
Total current
liabilities............ 902,730 2,024,536 2,322,306
------------ ------------ -------------
Long Term Debt...................... 97,600 310,054 977,336
------------ ------------ -------------
Stockholders' Equity
Preferred stock................ 960,000 960,000
Common stock................... 479,210 479,210 479,210
Retained earnings.............. (124,003) 124,285 1,126,896
Treasury stock, at cost........ (200) (200) (200)
------------ ------------ -------------
1,315,007 1,563,295 1,605,906
------------ ------------ -------------
$ 2,315,337 $ 3,897,885 $ 4,905,548
============ ============ =============

The accompanying notes are an integral part of these consolidated financial
statements

F-13
<PAGE>
UNITED WELLHEAD SERVICES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS

The accompanying notes are an integral part of these consolidated financial
statements

F-14
<PAGE>
UNITED WELLHEAD SERVICES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
PREFERRED COMMON RETAINED TREASURY
STOCK STOCK EARNINGS STOCK TOTAL
---------- ---------- ------------ -------- ------------
<S> <C> <C> <C> <C>
Balance, December 31, 1993.............. $ $ 1,516 $ 428,249 $ (200) $ 429,565
Distributions........................... (115,267) (115,267)
Reorganization relating to acquisition
of Wellhead Recycling, Inc............ 960,000 477,694 (396,260) 1,041,434
Common stock dividends.................. (27,485) (27,485)
Net loss................................ (193,787) (193,787)
---------- ---------- ------------ -------- ------------
Balance, December 31, 1994.............. 960,000 479,210 (304,550) (200) 1,134,460
Net income.............................. 180,547 180,547
---------- ---------- ------------ -------- ------------
Balance, December 31, 1995.............. 960,000 479,210 (124,003) (200) 1,315,007
Net income.............................. 248,288 248,288
---------- ---------- ------------ -------- ------------
Balance, December 31, 1996.............. 960,000 479,210 124,285 (200) 1,563,295
Issuance of long-term debt to redeem
preferred stock (unaudited)........... (960,000) (960,000)
Net income (unaudited).................. 1,002,611 1,002,611
---------- ---------- ------------ -------- ------------
Balance, September 30, 1997
(unaudited)........................... $ $ 479,210 $ 1,126,896 $ (200) $ 1,605,906
========== ========== ============ ======== ============
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements

F-15
<PAGE>
UNITED WELLHEAD SERVICES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
------------------------------------------ ------------------------
1994 1995 1996 1996 1997
------------ ------------ -------------- ---------- ------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss).................. $ (193,787) $ 180,547 $ 248,288 $ 307,847 $ 1,002,611
Preferred stock dividends....... 48,000 57,600 40,000 36,000
Preferred stock discount........ 378,829
------------ ------------ -------------- ---------- ------------
Net income before preferred stock
dividends and preferred stock
discount.......................... 185,042 228,547 305,888 347,847 1,038,611
Adjustments to obtain net cash
provided by (used in) operating
activities:
Depreciation and amortization... 69,289 98,368 115,823 82,324 95,185
Change in deferred income tax... (31,704) (174,818) 60,577 25,205
Loss (gain) on disposition of
assets......................... (1,979) 4,222 4,222 (1,979)
Change in cash, restricted...... (315) 8,619
Change in accounts receivable... 30,359 154,387 (1,270,827) (847,247) (452,071)
Change in inventory............. 101,226 (79,382) (55,475) (36,006) (396,477)
Change in prepaid expenses...... 108,835 (31,067) 170,664 (56,786) (44,638)
Change in accounts payable...... (42,918) (137) 626,377 164,346 (318,048)
Change in accrued liabilities... 33,362 (15,425) 281,607 408,170 262,607
Change in income tax payable.... 175,000 179,194 288,126
------------ ------------ -------------- ---------- ------------
Total adjustments............. 266,155 (39,455) 107,968 (101,783) (542,090)
------------ ------------ -------------- ---------- ------------
Net cash provided by
operating activities.... 451,197 189,092 413,856 246,064 496,521
------------ ------------ -------------- ---------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures............... (60,667) (17,140) (9,281) (97,896) (176,595)
Proceeds from sale of assets....... 18,142 4,058 4,421 4,858
Acquisition of business, net of
cash acquired..................... (186,532)
Purchase of investments............ (4,065) (4,065) (1,008)
------------ ------------ -------------- ---------- ------------
Net cash used in investing
activities.............. (229,057) (17,140) (9,288) (97,540) (172,745)
------------ ------------ -------------- ---------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Prepayment of offering costs....... (165,250)
Proceeds from notes payable........ 228,000 100,000 157,199 183,224
Principal payments under notes
payable........................... (216,532) (284,000) (131,948) (209,072) (190,233)
Proceeds from long-term debt....... 100,000 315,307 91,044 125,458
Principal payments under long-term
debt.............................. (99,975) (68,498) (189,144) (42,853) (346,081)
Distributions paid................. (115,267)
Common stock dividends paid........ (27,485)
Preferred stock dividends paid..... (24,000) (52,000) (40,000) (36,000)
------------ ------------ -------------- ---------- ------------
Net cash used in financing
activities.............. (231,259) (176,498) (57,785) (43,682) (428,882)
------------ ------------ -------------- ---------- ------------
NET INCREASE (DECREASE) IN CASH...... (9,119) (4,546) 346,783 104,842 (105,106)
CASH AT BEGINNING OF PERIOD.......... 36,372 27,253 22,707 22,707 369,490
------------ ------------ -------------- ---------- ------------
CASH AT END OF PERIOD................ $ 27,253 $ 22,707 $ 369,490 $ 127,549 $ 264,384
============ ============ ============== ========== ============
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements

F-16
<PAGE>
UNITED WELLHEAD SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION AND LINES OF BUSINESS

The consolidated financial statements include the accounts of United
Wellhead Services, Inc. (Wellhead) and its wholly owned subsidiary, Wellhead
Recycling, Inc. (WRI). The Company is engaged principally in the business of
sales and service of new and used wellhead equipment. All significant
intercompany accounts have been eliminated.

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are stated at cost. Depreciation of plant and
equipment is provided over the estimated useful lives of the respective assets
using the straight-line method, generally from five to ten years.

Expenditures for additions, major renewals and betterments are capitalized
and expenditures for maintenance and repairs are charged to earnings as
incurred.

When machinery and equipment are retired or otherwise disposed of, the cost
thereof and the applicable accumulated depreciation are removed from the
respective accounts and the resulting gain or loss is reflected in earnings.

INVENTORY

Inventory consisting of finished goods is valued at the lower of cost or
market, by the specific identification method.

USES OF ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from these estimates.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts of cash, cash equivalents, accounts receivable,
inventory, accounts payable and accrued liabilities approximate fair value
because of the short maturity of these items. The carrying amounts of long-term
debt approximate fair value because the interest rates on these instruments
change with market interest rates.

INCOME TAXES

Wellhead utilizes SFAS No. 109, Accounting for Income Taxes, which requires
an asset and liability approach to financial accounting and reporting for income
taxes. The difference between the financial statement and tax basis of assets
and liabilities is determined annually. Deferred income tax assets and
liabilities are computed for those differences that have future tax consequences
using the currently enacted tax laws and rates that apply to the periods in
which they are expected to affect taxable income. Valuation allowances are
established, if necessary, to reduce the deferred tax asset to the amount that
will more likely than not be realized. Income tax expense is the current tax
payable or refundable for the period plus or minus the net change in the
deferred tax assets and liabilities.

Income tax expense includes federal and state taxes currently payable and
the change in deferred taxes arising from temporary differences between income
for financial reporting and income tax purposes.

F-17
<PAGE>
UNITED WELLHEAD SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

REVENUE RECOGNITION

Revenues from the sale of equipment and services are recognized upon
shipping the equipment or providing the service to the customer.

AMORTIZATION OF GOODWILL

The cost in excess of net assets of WRI ("goodwill") is being amortized
on a straight-line basis over 5 years. On an annual basis, the carrying value of
goodwill is assessed in order to determine whether an impairment has occurred,
taking into account both historical and forecasted results of operations.

CHANGES IN ACCOUNTING STANDARDS

Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and Assets to be Disposed of" is applicable to
Wellhead in fiscal 1996. This statement requires that long-lived assets and
certain intangibles to be held and used by Wellhead be reviewed for impairment.
This pronouncement did not have a material impact on the financial statements of
Wellhead.

INTERIM FINANCIAL INFORMATION

The interim financial statements included herein are unaudited; however
they include all adjustments of a normal recurring nature, which, in the opinion
of management, are necessary to present fairly the financial position of
Wellhead at September 30, 1997, and the results of its operations and cash flows
for the nine months ended September 30, 1996 and 1997. Accounting measurements
at interim dates inherently involve greater reliance on estimates than at year
end. The results of operations for the interim periods presented are not
necessarily indicative of the results to be expected for the entire year.

DEFERRED OFFERING COSTS

Deferred offering costs represents costs incurred in connection with the
proposed public offering as described in Note L. Deferred offering costs will be
offset against net proceeds, if successful, or expensed if the offering is
unsuccessful.

STATEMENT OF CASH FLOWS

For purposes of the Statement of Cash Flows, Wellhead considers all highly
liquid debt instruments purchased with a maturity of three months or less to be
cash equivalents. As of December 31, 1996, balances of cash and cash equivalents
at two financial banking institutions exceeded the federally insured limit of
$100,000 by $167,825 and $105,471.

Supplemental disclosures of cash flows information:

Interest paid amounted to $44,733, $38,069, $23,986, $27,840 and $37,695
for the years ended December 31, 1996, 1995 and 1994 and the nine months ended
September 30, 1997 and 1996, respectively.

Noncash investing and financing activities consisted of the following:

Long-term debt obligations in the amount of $113,311 and $63,436 were
incurred for the acquisition of transportation equipment for the years ended
December 31, 1996 and 1995, respectively. Notes payable in the amount of
$157,199 and $65,325 were incurred to finance insurance premiums for the years
ended December 31, 1996 and 1995, respectively.

MAJOR CUSTOMERS

Wellhead had sales to five customers that represented 19%, 24%, 26%, 20%
and 21% of total revenue, of which no single customer accounted for over 10%,
for the years ended December 31, 1996, 1995 and 1994 and the nine months ended
September 30, 1997 and 1996, respectively.

F-18
<PAGE>
UNITED WELLHEAD SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

PER SHARE DATA

Per share data is calculated based upon the number of shares of common
stock outstanding, calculated on a pro forma basis giving effect to the
Reorganization (see Note L below). There are no dilutive stock options or
warrants outstanding.

NOTE B PROPERTY, PLANT AND EQUIPMENT

The major asset categories, together with the related costs and accumulated
depreciation and amortization, are as follows:

DECEMBER 31,
-------------------------- SEPTEMBER 30,
1995 1996 1997
------------ ------------ -------------
(UNAUDITED)
Land............................... $ 16,298 $ 16,298 $ 16,298
Machinery and equipment............ 823,200 840,150 859,812
Furniture and fixtures............. 127,450 129,537 137,115
Transportation equipment........... 182,401 263,457 391,575
Leasehold improvements............. 137,693 137,693 137,691
------------ ------------ -------------
1,287,042 1,387,135 1,542,491
Less accumulated depreciation and
amortization..................... 892,333 973,028 1,034,125
------------ ------------ -------------
$ 394,709 $ 414,107 $ 508,366
============ ============ =============

At December 31, 1996 and 1995 plant and equipment which cost $575,645 and
$573,830, respectively, has been fully depreciated but continues to be used in
current operations.

NOTE C NOTES PAYABLE

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31, SEPTEMBER 30,
1995 1996 1997
------------ ------------ -------------
(UNAUDITED)
<S> <C> <C>
Note payable, finance company for
insurance premiums -- payable $13,100
monthly including interest at 6.17%;
secured by unearned premiums.......... $ $ 25,251 $ 83,550
Notes payable, stockholders -- payable
on December 23, 1997 including
interest at 9.00%; unsecured.......... 115,308
Note payable, stockholder -- payable on
June 6, 1996 with interest at prime
plus 1.25%; secured by the personal
guarantee of another stockholder...... 185,000 See Note D
------------ ------------ -------------
$185,000 $140,559 $ 83,550
============ ============ =============
</TABLE>

F-19
<PAGE>
UNITED WELLHEAD SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE D LONG-TERM DEBT

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31, SEPTEMBER 30,
1995 1996 1997
------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C>
Note payable, bank -- payable $12,500
quarterly beginning on April 1, 1996,
with interest at prime plus 2.00%;
secured by accounts receivable and
inventory............................. $100,000 $ 62,500 $ 12,500
Note payable, bank -- payable on January
16, 1998, interest payable monthly at
prime plus 2%; Wellhead may borrow up
to 75% of its eligible receivables and
25% of eligible inventory with a
maximum availability of $700,000;
secured by accounts receivable,
inventory and guarantee of major
stockholder........................... 200,000 50,000
Note payable, stockholder -- payable
$5,625 monthly with interest at prime
plus 1.25%; secured by the personal
guarantee of another stockholder...... See Note C 101,250 50,625
Note payable, American National
Bank -- payable $779 monthly with
interest at 7.5%; secured by
transportation equipment.............. 4,672
Notes payable, finance
companies -- payable $5,322 (1996) and
$2,514 (1995) monthly with interest
from 8.5% - 11.9%; secured by
transportation equipment.............. 67,730 116,043 196,044
Note payable, individual--payable
$19,465 monthly including interest
beginning February 1, 1998; interest
at 8%, unsecured...................... 960,000
Notes payable, stockholders -- payable
$1,894 monthly with interest varying
from 7.75% to 8.5%.................... 17,272
------------ ------------ -------------
189,674 479,793 1,269,169
Current portion.................... 92,074 169,739 291,833
------------ ------------ -------------
Long-term portion.................. $ 97,600 $310,054 $ 977,336
============ ============ =============
</TABLE>

The aggregate principal payments on long-term debt during the years
subsequent to December 31, 1996, are: 1997 -- $169,739; 1998 -- $291,139; and
1999 -- $18,915.

NOTE E LEASES

Wellhead leases office and warehouse space under operating leases that
expire at various times through July, 1999. Total rent expense for all operating
leases for the years ended December 31, 1996, 1995 and 1994 amounted to
$184,739, $175,337 and $162,580, respectively.

Future minimum payments, by year and in aggregate, related to the operating
leases at December 31, 1996 are as follows:

1997.................................... $ 150,539
1998.................................... 60,913
1999.................................... 25,700
----------
$ 237,152
==========

The operating leases include office and warehouse space leased from a
stockholder (See Note H).

F-20
<PAGE>
UNITED WELLHEAD SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE F INCOME TAXES

The components of income tax provisions (benefits) are as follows:
<TABLE>
<CAPTION>
DECEMBER 31,
------------------------------------ SEPTEMBER 30,
1994 1995 1996 1997
---------- ------------ ---------- -------------
(UNAUDITED)
<S> <C> <C> <C>
Current................................. $ $ (3,100) $ 175,000 $ 570,000
Deferred................................ (31,704) (168,589) 82,266 45,581
---------- ------------ ---------- -------------
$ (31,704) $ (171,689) $ 257,266 $ 615,581
========== ============ ========== =============
</TABLE>

The significant components of the net deferred tax asset (liability) are as
follows:

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------------------ SEPTEMBER 30,
1994 1995 1996 1997
------------ ---------- ---------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
Depreciation of plant and equipment..... $ (42,254) $ (41,917) $ (64,065) $ (64,156)
Accrued liabilities..................... 1,581
Net operating losses.................... 271,971 212,025 210,010 184,896
------------ ---------- ---------- -------------
229,717 171,689 145,945 120,740
Valuation allowance..................... (271,971)
------------ ---------- ---------- -------------
Net deferred tax asset (liability)...... $ (42,254) $ 171,689 $ 145,945 $ 120,740
============ ========== ========== =============
</TABLE>

The provisions (benefits) for income taxes differs from an amount computed
at the statutory rates as follows:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31, DECEMBER 31, SEPTEMBER 30,
1994 1995 1996 1997
------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
Federal income tax statutory rates...... $ 52,020 $ 19,331 $202,880 $ 554,198
State income taxes...................... 8,876 9,736 41,685 66,168
Nondeductible expenses.................. 27,429 25,937 38,228 32,146
Effect of S Corporation income.......... (42,162)
Recognition of net operating loss
benefit............................... (212,025)
Net operating loss deduction............ (77,867) (14,668) (25,527) (36,931)
------------ ------------ ------------ -------------
$(31,704) $ (171,689) $257,266 $ 615,581
============ ============ ============ =============
</TABLE>

Under the asset and liability method, deferred tax assets and liabilities
are determined based on the differences between the financial statement and tax
basis of assets and liabilities and are measured using enacted tax rates.

Valuation allowances are established when necessary to reduce deferred tax
assets to the amount expected to be realized. Income tax expense is the tax
payable or refundable for the period plus or minus the change during the period
in deferred tax assets and liabilities.

As of December 31, 1996, Wellhead has net operating loss carryforwards of
approximately $615,000 for federal income tax purposes available to offset
future financial income, expiring, if not used, periodically through the year
2009. Subsequent to December 31, 1996, as a result of the proposed initial
public offering (Note L), there will be a change in ownership which, when
considered with potential future ownership changes, could restrict the
utilization of net operating loss carryforwards in the future.

F-21
<PAGE>
UNITED WELLHEAD SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE G REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY

Stockholders' equity consists of the following:

Redeemable preferred stock -- The preferred stock has a par value of $4.73
per share, 202,960 shares are authorized, issued and outstanding. The preferred
stock has a liquidation value of $4.73 per share. Preferred stock has a voting
power equivalent to common stock. Preferred stock also has preferences in
liquidation or winding up of the affairs of Wellhead. When the redeemable
preferred stock was issued, due to a conversion feature, a discount of $378,829
was recognized, and written off during the period ended December 31, 1994.
Accrued liabilities at December 31, 1996 and 1995 included dividends payable of
$29,600 and $24,000, respectively.

Dividends on the preferred stock are payable as follows:

1996.................................... 6%
1997.................................... 6%
1998.................................... 10%
1999.................................... 11%
2000.................................... 12%

Common stock -- The common stock is no par stock, of which 1,000,000 shares
are authorized, and 526,133 are issued and outstanding.

NOTE H RELATED PARTY TRANSACTIONS

Related party transactions and related balances with the stockholders of
Wellhead and companies owned by stockholders are as follows:

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31, DECEMBER 31, SEPTEMBER 30,
1994 1995 1996 1997
------------ ------------ ------------ -------------
(UNAUDITED)
<S> <C> <C>
Accounts receivable..................... $ 7,728 $ $ $
Notes payable........................... 219,000 185,000 115,308
Accrued liabilities..................... 17,780 9,118
Long-term debt.......................... 66,663 17,272 101,250 50,625
Rent expense............................ 18,550 53,836 59,102 39,309
Interest expense........................ 21,482 23,146 17,393 14,511
Management fee expense, Flare King,
Inc................................... 48,000 52,000 80,300 36,000
</TABLE>

NOTE I CONCENTRATION OF CREDIT RISK

Wellhead sells and services new and used wellhead equipment to oil and gas
industry in Texas and Louisiana. Wellhead grants credit to customers,
substantially all of whom are commercial establishments located in the vicinity
of the operating locations of Wellhead.

NOTE J PROFIT SHARING AND 401(K) PLAN

Wellhead maintains a qualified cash or deferred compensation plan under
section 401(k) of the Internal Revenue Code. Under the plan, employees may elect
to defer up to 15% of their salary, subject to the Internal Revenue Code limits.
Wellhead may make a discretionary matching as well as a discretionary
contribution. The contributions of Wellhead totaled $31,346 and $4,000 for the
years ended December 31, 1996, and 1995, respectively. No contributions were
accrued at September 30, 1997 or 1996.

F-22
<PAGE>
UNITED WELLHEAD SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE K BUSINESS ACQUISITION

On May 31, 1994, Wellhead acquired all of the outstanding stock of WRI,
Inc. (the holding company for Wellhead Recycling, Inc.), in exchange for 202,960
shares of preferred stock, 12,690 shares of common stock, $200,000 in cash and a
$219,000 note. The purchase price was allocated to the estimated fair value of
assets acquired and liabilities assumed, of approximately $1,471,000 and
$440,000, respectively.

In conjunction with the acquisition, the tax status of Wellhead was
converted from a Subchapter S corporation to a Subchapter C corporation.

NOTE L SUBSEQUENT EVENTS

In April, 1997, Wellhead signed a letter of intent with D.E. Frey &
Company, Inc., which provided that the stockholders of Wellhead, along with the
equityholders of Flare King, Inc. ("Flare King"), and Hi-Tech Compressor
Company, L.C. ("Hi-Tech") will exchange their shares or equity interests
through a business combination to form a new holding company, United Oilfield
Services, Inc. United Oilfield Services, Inc. intends to proceed with an initial
public offering (the "Offering") on a "best efforts basis." There can be no
assurances that the Offering will be consummated.

In August, 1997 (unaudited), the preferred stock was redeemed by issuance
of a promissory note in the amount of $960,000, with interest only at 8% monthly
from September 30, 1997 through January 1, 1998. Beginning February 1, 1998,
principal and interest are payable in monthly installments in the amount of
$19,465. If the Offering referred to above is successful, part of the proceeds
will be used to retire this debt.

Effective as of October 14, 1997, Wellhead and the equity holders of
Wellhead, Flare King and Hi-Tech (the "Founding Companies") entered into an
Agreement and Plan of Reorganization, which was subsequently amended. Pursuant
to such agreement and simultaneously with and as a condition to the closing of
such agreement and the Offering, United Oilfield Services, Inc. will issue to
the holders (other than one of the Founding Companies) of the outstanding equity
interests in the Founding Companies shares of its Common Stock in exchange for
such equity interests (the "Reorganization"). There can be no assurances that
the Offering or the Reorganization will be consummated.

F-23

<PAGE>
INDEPENDENT AUDITOR'S REPORT

To the Stockholders and Directors of
FLARE KING, INC.
Corpus Christi, Texas

We have audited the accompanying balance sheet of FLARE KING, INC. as of
December 31, 1996 and the related statements of operations, stockholders'
equity, and cash flows for the year then ended. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of FLARE KING, INC. at December
31, 1996, and the results of its operations and its cash flows for the year
ended December 31, 1996, in conformity with generally accepted accounting
principles.

/s/ KARLINS FULLER ARNOLD & KLODOSKY, P.C.

The Woodlands, Texas
March 3, 1997 except for Note J,
as to which the dates are April 11, 1997 and December 23, 1997

F-24
<PAGE>
FLARE KING, INC.
BALANCE SHEETS

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)

ASSETS

CURRENT ASSETS
Cash............................... $ 16,483 $ 11,082
Accounts receivable, trade......... 156,116 123,656
Accounts receivable, other......... 39,770 90,648
Accounts receivable, Hi-Tech
Compressor Company, L.C.......... 28,717 12,556
Inventory.......................... 62,243 51,713
Prepaid expenses................... 6,624 32,556
Deferred income taxes.............. 32,228
------------ -------------
Total current assets.......... 342,181 322,211
------------ -------------
PROPERTY, PLANT AND EQUIPMENT, at
cost.................................. 271,392 281,131
Less accumulated depreciation and
amortization..................... 135,319 167,325
------------ -------------
136,073 113,806
------------ -------------
OTHER ASSETS
Investments........................ 83,485 90,714
Intangible assets, net............. 309,321 286,951
Deposits........................... 2,305 2,305
------------ -------------
395,111 379,970
------------ -------------
$ 873,365 $ 815,987
============ =============

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Current portion of long-term
debt............................. $ 203,647 $ 166,198
Accounts payable, trade............ 103,250 40,309
Accrued liabilities................ 45,421 38,989
------------ -------------
Total current liabilities..... 352,318 245,496
------------ -------------
LONG-TERM DEBT.......................... 193,687 177,674
------------ -------------
STOCKHOLDERS' EQUITY
Common stock....................... 111,455 111,455
Additional paid-in capital......... 374,545 374,545
Retained earnings (deficit)........ (158,640) (93,183)
------------ -------------
327,360 392,817
------------ -------------
$ 873,365 $ 815,987
============ =============

The accompanying notes are an integral part of these financial statements.

F-25
<PAGE>
FLARE KING, INC.
STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
DECEMBER 31, ----------------------
1996 1996 1997
------------ ---------- ----------
(UNAUDITED)
<S> <C> <C> <C>
Revenues............................. $1,033,920 $ 742,218 $ 902,169
Cost of goods sold................... 541,755 343,335 471,079
------------ ---------- ----------
Gross Profit......................... 492,165 398,883 431,090
Selling, general and administrative
expenses........................... 353,403 229,262 263,776
Depreciation and amortization
expenses........................... 72,487 36,612 54,375
------------ ---------- ----------
425,890 265,874 318,151
------------ ---------- ----------
Income from operations............... 66,275 133,009 112,939
------------ ---------- ----------
Income in subsidiary................. 73,140 33,650 17,229
Interest expense..................... (47,842) (24,057) (24,754)
Other income (expense), net.......... 53,730 519 16
------------ ---------- ----------
79,028 10,112 (7,509)
------------ ---------- ----------
Income before income tax provision... 145,303 143,121 105,430
Income tax provision................. (32,607) (34,521) (39,973)
------------ ---------- ----------
Net income........................... $ 112,696 $ 108,600 $ 65,457
============ ========== ==========
Net income per common share.......... $ 1.01 $ 0.97 $ 0.59
============ ========== ==========
Shares used in computing net income
per common share................... 111,455 111,455 111,455
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-26
<PAGE>
FLARE KING, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
ADDITIONAL RETAINED
COMMON PAID-IN EARNINGS
STOCK CAPITAL (DEFICIT) TOTAL
-------- ---------- --------- ----------
<S> <C> <C> <C> <C>
Balance, December 31, 1995........... $111,455 $ 374,545 $(271,336) $ 214,664
Net income........................... 112,696 112,696
-------- ---------- --------- ----------
Balance, December 31, 1996........... 111,455 374,545 (158,640) 327,360
Net income (unaudited)............... 65,457 65,457
-------- ---------- --------- ----------
Balance, September 30, 1997
(unaudited).......................... $111,455 $ 374,545 $ (93,183) $ 392,817
======== ========== ========= ==========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-27
<PAGE>

FLARE KING, INC.
STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED
SEPTEMBER 30,
DECEMBER 31, ----------------------
1996 1996 1997
------------ ---------- ----------
(UNAUDITED)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income......................... $ 112,696 $ 108,600 $ 65,457
------------ ---------- ----------
Adjustments to obtain net cash
provided by operating activities:
Depreciation and
amortization............... 79,314 36,612 54,376
Change in deferred income
tax........................ 32,607 32,228
Loss (gain) on disposition of
assets..................... (13,678) (519)
Income from Hi-Tech Compressor
Company, L.C............... (73,140) (33,650) (17,229)
Change in accounts receivable,
trade...................... (81,061) (53,007) 32,460
Change in accounts receivable,
other...................... 11,136 (8,286) (50,878)
Change in accounts receivable,
Hi-Tech Compressor Company,
L.C........................ 46,769 31,377 16,161
Change in inventory........... (29,637) 2,900 10,530
Change in prepaid expenses.... 25,411 (15,043) (25,932)
Change in deposits............ 697
Change in accounts payable.... (51,939) (61,820) (62,941)
Change in accrued
liabilities................ 43,595 33,361 (6,432)
------------ ---------- ----------
Total adjustments........ (9,926) (68,075) (17,657)
------------ ---------- ----------
Net cash provided
by operating
activities....... 102,770 40,525 47,800
------------ ---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Distributions received from Hi-Tech
Compressor
Company, L.C..................... 38,500 16,502 10,000
Capital expenditures............... (7,035) (8,040) (9,739)
Proceeds from sale of assets....... 15,200 10,744
------------ ---------- ----------
Net cash provided
by investing
activities....... 46,665 19,206 261
------------ ---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term debt....... 80,800 79,921 42,224
Principal payments under long-term
debt............................. (213,752) (139,651) (95,686)
------------ ---------- ----------
Net cash used in
financing
activities....... (132,952) (59,730) (53,462)
------------ ---------- ----------
Net increase (decrease) in cash......... 16,483 1 (5,401)
Cash at beginning of period............. 16,483
------------ ---------- ----------
Cash at end of period................... $ 16,483 $ 1 $ 11,082
============ ========== ==========

The accompanying notes are an integral part of these financial statements.

F-28
<PAGE>
FLARE KING, INC.
NOTES TO FINANCIAL STATEMENTS

NOTE A BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

LINES OF BUSINESS

Flare King, Inc. ("Flare King") is a manufacturer of natural gas flare
stacks and ignition systems for use in oilfield, refinery, and petrochemical
plant applications.

ALLOWANCE FOR DOUBTFUL ACCOUNTS

Management believes that all receivables at December 31, 1996 and September
30, 1997 (unaudited), are collectible, therefore no allowance for doubtful
accounts has been recorded. During the year ended December 31, 1996, accounts
receivable in the amount of $5,864 were written off.

PROPERTY, PLANT AND EQUIPMENT

Expenditures for additions, major renewals and betterments are capitalized
and expenditures for maintenance and repairs are charged to earnings as
incurred.

INVENTORY

Inventory is valued at the lower of cost or market, by the first-in,
first-out method. Inventory consisted of the following:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
Finished goods.......................... $ 28,656 $31,709
Work-in-progress........................ 33,587 20,004
------------ -------------
$ 62,243 $51,713
============ =============

Work-in-process and finished goods include raw materials, direct labor and
manufacturing overhead at December 31, 1996 and September 30, 1997 (unaudited).

USES OF ESTIMATES

INCOME TAXES

Flare King utilizes SFAS No. 109, Accounting for Income Taxes, which
requires an asset and liability approach to financial accounting and reporting
for income taxes. The difference between the financial statement and tax basis
of assets and liabilities is determined annually. Deferred income tax assets and
liabilities are computed for those differences that have future tax consequences
using the currently enacted tax laws and rates that apply to the periods in
which they are expected to affect taxable income. Valuation allowances are
established, if necessary, to reduce the deferred tax asset to the amount that
will more likely

F-29
<PAGE>
FLARE KING, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
than not be realized. Income tax expense is the current tax payable or
refundable for the period plus or minus the net change in the deferred tax
assets and liabilities.

REVENUE RECOGNITION

Revenues from the sale of equipment and services are generally recognized
upon shipping of equipment or providing service to the customer.

CHANGES IN ACCOUNTING STANDARDS

Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and Assets to be Disposed of" is applicable to
Flare King in fiscal 1996. This statement requires that long-lived assets and
certain intangibles to be held and used by Flare King be reviewed for
impairment. This pronouncement did not have a material impact on the financial
statements of Flare King.

AMORTIZATION

Patent costs are amortized on a straight-line basis over 17 years. On an
annual basis, Flare King assesses the carrying value of patents in order to
determine whether an impairment has occurred, taking into account both
historical and forecasted sales and gross profits.

PER SHARE DATA

Per share data is calculated based upon the weighted average number of
shares of common stock and dilutive stock options and warrants outstanding.

FAIR VALUE OF FINANCIAL INSTRUMENTS

INTERIM FINANCIAL INFORMATION

The interim financial statements included herein are unaudited; however,
they include all adjustments of a normal recurring nature, which, in the opinion
of management, are necessary to present fairly the financial position of Flare
King at September 30, 1997, and the results of its operations and cash flows for
the nine months ended September 30, 1996 and 1997. Accounting measurements at
interim dates inherently involve greater reliance on estimates than at year end.
The results of operations for the interim periods presented are not necessarily
indicative of the results to be expected for the entire year.

STATEMENT OF CASH FLOWS

For purposes of the Statement of Cash Flows, Flare King considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents.

Supplemental disclosures of cash flows information:

Interest paid amounted to $43,558, $24,560 and $24,056 for the year
ended December 31, 1996 and the nine months ended September 30, 1997 and
1996 (unaudited), respectively.

Noncash investing and financing activities consisted of the following:

Long-term debt obligations in the amount of $31,722 were incurred for
accounts payable reclassified. Notes payable in the amount of $20,919 were
incurred to finance insurance premiums for the year ended December 31,
1996.

F-30
<PAGE>
FLARE KING, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

MAJOR CUSTOMERS

Flare King had sales to five customers that aggregated to 38%, 57% and 70%
of total revenue, for the year ended December 31, 1996 and the nine months ended
September 30, 1997 and 1996 (unaudited), respectively.

INVESTMENT IN HI-TECH COMPRESSOR COMPANY, L.C. ("HI-TECH")

Flare King accounts for its investment in Hi-Tech using the equity method
of accounting.

NOTE B PROPERTY, PLANT AND EQUIPMENT

The major asset categories, together with the related costs and accumulated
depreciation and amortization, are as follows:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------- -------------
(UNAUDITED)
Rental equipment..................... $ 67,717 $ 67,717
Machinery and equipment.............. 65,936 70,275
Furniture and fixtures............... 29,600 31,204
Transportation equipment............. 28,560 32,356
Building, and leasehold
improvements......................... 79,579 79,579
------------- -------------
271,392 281,131
Less accumulated depreciation........ (135,319) (167,325)
------------- -------------
$ 136,073 $ 113,806
============= =============

NOTE C INTANGIBLE ASSETS

Intangible assets consists principally of two patents, a flare tip ignition
device and flare tip pilot burner. These patents have a basis of $403,802 and
accumulated amortization of $97,469 as of December 31, 1996, for a net book
value of $306,333. The flare tip ignition device is a patent design that is used
in most of Flare King production design flares. The flare tip pilot burner is a
patented design that is included in the majority of the flares manufactured by
Flare King and is used to provide a flame to ignite waste gas that is channeled
through the flare tip. These patents are being amortized over seventeen years.

F-31
<PAGE>
FLARE KING, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

NOTE D INVESTMENT IN HI-TECH COMPRESSOR COMPANY, L.C.

For the year ended December 31, 1996 and the nine months ended September
30, 1997 (unaudited) Flare King had a 50% investment in Hi-Tech. A summarized
balance sheet and statement of operations for the year ended December 31, 1996
and September 30, 1997 (unaudited) are as follows:

Summarized balance sheets:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
ASSETS
Cash............................ $ 84,614 $ 13,470
Accounts and note receivable.... 253,207 212,710
Inventory....................... 185,589 180,462
Prepaid expenses and other
assets.......................... 18,881 38,977
------------ -------------
542,291 445,619
------------ -------------
Property, plant and equipment... 179,977 372,798
Accumulated depreciation........ (64,721) (95,595)
------------ -------------
115,256 277,203
------------ -------------
$ 657,547 $ 722,822
============ =============
LIABILITIES AND MEMBERS' CAPITAL
Current liabilities............. $ 350,847 $ 366,321
Long-term debt, net of current
maturities.................... 139,729 175,072
Members' capital................ 166,971 181,429
------------ -------------
$ 657,547 $ 722,822
============ =============

Summarized Statements of Operations:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Revenue......................... $1,107,638 $ 566,045
Cost of goods sold.............. 735,705 370,277
------------ -------------
Gross profit.................... 371,933 195,768
------------ -------------
Selling, general and
administrative expenses....... 174,137 109,650
Depreciation and amortization
expenses...................... 31,913 30,875
Other expense (income), net..... 19,603 20,785
------------ -------------
225,653 161,310
------------ -------------
Net Income........................... $ 146,280 $ 34,458
============ =============

F-32
<PAGE>
FLARE KING, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

NOTE E LONG-TERM DEBT

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Note payable, bank -- payable $8,770
monthly, with interest at prime plus
2.75%; secured by accounts receivable,
inventory and machinery and
equipment............................. $257,564 $
Note payable, bank -- revolving line of
credit, with maximum borrowings up to
$125,000 at an interest rate of prime
plus 2.75%; secured by accounts
receivable, inventory, machinery and
equipment and personal guarantee of
the stockholder....................... 97,981
Note payable, bank -- payable $4,940
monthly, with interest at prime plus
2.75%; secured by accounts receivable,
inventory, machinery and equipment and
personal guarantee of the major
stockholder........................... 139,163
Note payable, individual -- payable
$2,114 monthly with interest at
10.00%; unsecured..................... 66,422 60,778
Notes payable, two
individuals -- payable $2,000 monthly;
non-interest bearing and unsecured.... 56,000 28,000
Notes payable, miscellaneous............ 17,348 17,950
------------ -------------
397,334 343,872
Current portion......................... 203,647 166,198
------------ -------------
Long-term portion....................... $193,687 $ 177,674
============ =============

The aggregate principal payments on long-term debt during the years
subsequent to December 31, 1996 are: 1997 -- $203,647; 1998 -- $98,467 and
1999 -- $95,220.

NOTE F PROVISION FOR INCOME TAXES

The components of the provision for income taxes are as follows:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Current................................. $ $ (7,745)
Deferred................................ (32,607) (32,228)
------------ -------------
$(32,607) $ (39,973)
============ =============

The provision for income taxes differs from the amount computed at the
statutory rates as follows:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Federal income tax at statutory rates... $ 39,918 $ (15,596)
Utilization of net operating loss
carryforward.......................... (24,377)
Recognition of net operating loss
benefit............................... (72,525)
------------ -------------
$(32,607) $ (39,973)
============ =============

The deferred tax asset at December 31, 1996, consisted of Flare King's
benefit from net operating loss carryforwards. The benefit was recognized for
the nine months ended September 30, 1997 (unaudited).

F-33
<PAGE>
FLARE KING, INC.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

As of December 31, 1996, Flare King has net operating loss carryforwards of
approximately $95,000 for federal income tax purposes available to offset future
financial income, expiring, if not used, periodically through the year 2009.
Flare King also has capital loss carryforwards of approximately $6,300.

NOTE G STOCKHOLDERS' EQUITY

Stockholders' equity consists of the following:

Common stock -- The common stock is $1 par stock, 1,000,000 shares are
authorized; 111,455 are issued and outstanding.

NOTE H RELATED PARTY TRANSACTIONS

Related party transactions and related balances with the stockholders of
Flare King and companies owned by stockholders are as follows:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Accounts receivable, stockholder........ $ 39,770 $90,648
Accounts receivable, Hi-Tech............ 28,717 12,556
Management fee income, United Wellhead
Services, Inc. ("Wellhead")......... 80,300 36,000

NOTE I CONCENTRATION OF CREDIT RISK

Flare King sells its products and services to the oil and gas industry in
Texas. Flare King grants credit to customers, substantially all of whom are
commercial establishments located in the vicinity of the operating locations of
Flare King.

NOTE J SUBSEQUENT EVENTS

In April, 1997, Flare King signed a Letter of Intent with D.E. Frey &
Company, Inc., which provided for the stockholders of Flare King, along with the
equityholders of Wellhead and Hi-Tech to exchange their shares or equity
interests through a business combination to form a new holding company, United
Oilfield Services, Inc. United Oilfield Services, Inc. intends to proceed with
an initial public offering (the "Offering") on a "best efforts basis." There
can be no assurances that this Offering will be consummated.

F-34

<PAGE>
INDEPENDENT AUDITOR'S REPORT

To the Members of
HI-TECH COMPRESSOR COMPANY, L.C.
Corpus Christi, Texas

We have audited the accompanying balance sheet of HI-TECH COMPRESSOR
COMPANY, L.C. as of December 31, 1996 and the related statements of results of
operations, members' capital, and cash flows for the year then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of HI-TECH COMPRESSOR COMPANY,
L.C. at December 31, 1996, and the results of its operations and its cash flows
for the year ended December 31, 1996, in conformity with generally accepted
accounting principles.

/s/ KARLINS FULLER ARNOLD & KLODOSKY, P.C.

The Woodlands, Texas
March 3, 1997 except for Note H,
as to which the dates are April 11, 1997 and December 23, 1997

F-35
<PAGE>
HI-TECH COMPRESSOR COMPANY, L.C.
BALANCE SHEETS

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------- --------------
(UNAUDITED)
ASSETS
Current Assets
Cash............................ $ 84,614 $ 13,470
Accounts receivable, trade, net
of allowance................... 203,455 181,405
Accounts receivable, other...... 12,775 10,150
Note receivable................. 36,977 21,155
Inventory....................... 185,589 180,462
Prepaid expenses................ 9,005 29,151
------------- --------------
Total Current Assets....... 532,415 435,793
------------- --------------
Property, Plant and Equipment, at
cost................................. 179,977 372,798
Less accumulated depreciation
and amortization............... 64,721 95,595
------------- --------------
115,256 277,203
------------- --------------
Other Assets
Investments..................... 6,000 6,000
Deposits........................ 3,876 3,826
------------- --------------
9,876 9,826
------------- --------------
$ 657,547 $722,822
============= ==============
LIABILITIES AND MEMBERS' CAPITAL
Current Liabilities
Current portion of long-term
debt........................... $ 153,356 $314,149
Accounts payable, trade......... 30,990 37,403
Accounts payable, Flare King,
Inc............................ 28,717 12,556
Accrued liabilities............. 17,184 2,213
Deferred income................. 120,600
------------- --------------
Total Current
Liabilities............ 350,847 366,321
------------- --------------
Long-term Debt....................... 139,729 175,072
------------- --------------
Members' Capital..................... 166,971 181,429
------------- --------------
$ 657,547 $722,822
============= ==============

The accompanying notes are an integral part of these financial statements

F-36
<PAGE>
HI-TECH COMPRESSOR COMPANY, L.C.
STATEMENTS OF OPERATIONS

YEAR ENDED NINE MONTHS ENDED
DECEMBER 31, SEPTEMBER 30,
------------- ----------------------
1996 1996 1997
------------- ---------- ----------
Revenues............................. $ 1,107,638 $ 853,503 $ 566,045
Cost of goods sold................... 735,705 614,057 370,277
------------- ---------- ----------
Gross Profit......................... 371,933 239,446 195,768
Selling, general and administrative
expenses........................... 174,137 105,101 109,650
Depreciation and amortization
expenses........................... 31,913 23,281 30,875
------------- ---------- ----------
206,050 128,382 140,525
------------- ---------- ----------
Income from operations............... 165,883 111,064 55,243
------------- ---------- ----------
Interest expense..................... (16,175) (11,333) (24,159)
Other income (expense), net.......... (3,428) (32,433) 3,374
------------- ---------- ----------
(19,603) (43,766) (20,785)
------------- ---------- ----------
Net Income before pro forma
adjustment........................... 146,280 67,298 34,458
Pro forma
adjustment -- provision for
income taxes.................. 40,549 11,824 5,169
------------- ---------- ----------
Pro forma net income............ $ 105,731 $ 55,474 $ 29,289
============= ========== ==========

The accompanying notes are an integral part of these financial statements

F-37
<PAGE>
HI-TECH COMPRESSOR COMPANY, L.C.
STATEMENTS OF MEMBERS' CAPITAL

MEMBERS'
CAPITAL
--------

Balance, December 31, 1995.............. $ 97,691

Distributions........................... (77,000)

Net income.............................. 146,280
--------

Balance, December 31, 1996.............. 166,971

Distributions (unaudited)............... (20,000)
Net Income (unaudited).................. 34,458
--------

Balance, September 30, 1997
(unaudited)........................... $181,429
========

The accompanying notes are an integral part of these financial statements

F-38
<PAGE>
HI-TECH COMPRESSOR COMPANY, L.C.
STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED SEPTEMBER 30,
DECEMBER 31, --------------------------
1996 1996 1997
------------ ------------ ------------
(UNAUDITED)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income......................... $ 146,280 $ 67,298 $ 34,458
------------ ------------ ------------
Adjustments to obtain net cash
provided by (used in) operating
activities:
Depreciation and
amortization............... 27,836 23,281 30,875
Gain on disposition of
assets..................... (25,883)
Change in accounts receivable,
trade...................... (16,501) 149 22,050
Change in accounts receivable,
other...................... (11,225) 2,625
Change in note receivable..... (36,977) 15,822
Change in inventory........... (115,332) (169,858) 1,301
Change in prepaid expenses.... (7,450) (7,442) (16,270)
Change in deposits............ 67
Change in accounts payable.... 13,591 100,182 6,413
Change in accounts payable,
Flare King, Inc............ (61,026) (31,526) (17,107)
Change in accrued
liabilities................ (26,553) (474) (14,025)
Change in deferred revenue.... 120,600 (120,600)
------------ ------------ ------------
Total adjustments........ (138,853) (85,688) (88,916)
------------ ------------ ------------
Net cash provided
by (used in)
operating
activities....... 7,427 (18,390) (54,458)
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures............... (7,007) (192,821)
Proceeds from sale of assets....... 99,341 104,839
------------ ------------ ------------
Net cash provided
by (used in)
investing
activities....... 92,334 104,839 (192,821)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term debt....... 538,780 328,704 318,712
Principal payments under long-term
debt............................. (483,380) (385,857) (122,577)
Member distributions............... (77,000) (27,000) (20,000)
------------ ------------ ------------
Net cash provided
by (used in)
financing
activities....... (21,600) (84,153) 176,135
------------ ------------ ------------
Net increase (decrease) in cash......... 78,161 2,296 (71,144)
Cash at beginning of period............. 6,453 6,453 84,614
------------ ------------ ------------
Cash at end of period................... $ 84,614 $ 8,749 $ 13,470
============ ============ ============
</TABLE>

The accompanying notes are an integral part of these financial statements

F-39
<PAGE>
HI-TECH COMPRESSOR COMPANY, L.C.
NOTES TO FINANCIAL STATEMENTS

NOTE A BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

LINES OF BUSINESS

Hi-Tech Compressor Company, L.C. ("Hi-Tech") is a packager of natural gas
compressors.

ALLOWANCE FOR DOUBTFUL ACCOUNTS

PROPERTY, PLANT AND EQUIPMENT

Expenditures for additions, major renewals and betterments are capitalized
and expenditures for maintenance and repairs are charged to earnings as
incurred.

INVENTORY

Inventory is valued at the lower of cost or market, by the first-in,
first-out method. Inventory consisted of the following:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Finished goods.......................... $101,590 $ 111,509
Work-in-progress........................ 83,999 68,953
------------ -------------
$185,589 $ 180,462
============ =============

Work-in-process and finished goods include raw materials, direct labor and
manufacturing overhead at December 31, 1996 and September 30, 1997 (unaudited).

USES OF ESTIMATES

FAIR VALUE OF FINANCIAL INSTRUMENTS

F-40
<PAGE>
HI-TECH COMPRESSOR COMPANY, L.C.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

INTERIM FINANCIAL INFORMATION

The interim financial statements included herein are unaudited, but include
all adjustments of a normal recurring nature, which, in the opinion of
management, are necessary to present fairly the financial position of Hi-Tech at
June 30, 1997, and the results of its operations and cash flows for the nine
months ended September 30, 1996 and 1997. Accounting measurements at interim
dates inherently involve greater reliance on estimates than at year end. The
results of operations for the interim periods presented are not necessarily
indicative of the results to be expected for the entire year.

INCOME TAXES

Hi-Tech currently operates as a limited liability corporation. As such, no
provision for income taxes for Hi-Tech has been provided in the accompanying
financial statements as any income or loss is included on the income tax returns
of the individual members. The pro forma tax provision and net income, assuming
a 34% tax rate, discloses the tax expense incurred had Hi-Tech been a
C-Corporation subject to federal income taxes.

REVENUE RECOGNITION

Revenues from the sale of equipment and services are recognized upon
shipping of equipment and providing of service to the customer. Rental revenues
are recognized over the terms of the leases.

STATEMENT OF CASH FLOWS

For purposes of the Statement of Cash Flows, Hi-Tech considers all highly
liquid debt instruments purchased with a maturity of three months or less to be
cash equivalents.

Supplemental disclosures of cash flows information:

Interest paid amounted to $16,175, $24,159 and $11,333 for the year
ended December 31, 1996 and nine months ended September 30, 1997 and 1996
(unaudited), respectively.

Noncash investing and financing activities consisted of the following:

Long-term debt obligations in the amount of $26,685 were incurred for
the acquisition of transportation equipment for the year ended December 31,
1996.

MAJOR CUSTOMERS

Hi-Tech had sales to two customers that represented 31% and 25% of total
revenue for the year ended December 31, 1996. For nine months ended September
30, 1997 and 1996, sales to these two customers represented 44% and 39% of total
revenue, respectively.

F-41
<PAGE>
HI-TECH COMPRESSOR COMPANY, L.C.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

NOTE B PROPERTY, PLANT AND EQUIPMENT

The major asset categories, together with the related costs and accumulated
depreciation and amortization, are as follows:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Rental equipment..................... $133,061 $ 325,882
Machinery and equipment.............. 2,143 2,143
Furniture and fixtures............... 4,177 4,177
Transportation equipment............. 22,715 22,715
Building, and leasehold
improvements......................... 17,881 17,881
------------ -------------
179,977 372,798
Less accumulated depreciation and
amortization....................... (64,721) (95,595)
------------ -------------
$115,256 $ 277,203
============ =============

NOTE C NOTE RECEIVABLE

At December 31, 1996 and September 30, 1997 (unaudited), Hi-Tech has a note
receivable with a customer, which is receivable $3,259 monthly including
interest at 10.50%. This note is secured by equipment sold to the customer.

NOTE D LONG-TERM DEBT

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Note payable, bank -- payable $11,800
monthly, plus interest at prime
plus 1.00%; Hi-Tech may borrow up
to 80% of its eligible receivables
and 50% of eligible inventory with
a maximum availability of $425,000;
secured by accounts receivable,
inventory and machinery and
equipment.......................... $266,400 $ 307,000
Note payable, bank -- revolving line
of credit, with interest at 9.5%;
Hi-Tech may borrow up to 80% of its
eligible receivables and 50% of
eligible inventory with a maximum
availability of $250,000; secured
by accounts receivable, inventory,
machinery and equipment............ 162,000
Note payable, bank -- payable $629
monthly, including interest at
8.25%; secured by transportation
equipment.......................... 20,000 16,872
Note payable, miscellaneous.......... 6,685 3,349
------------ -------------
293,085 489,221
Current portion...................... 153,356 314,149
------------ -------------
Long-term portion.................... $139,729 $ 175,072
============ =============

The aggregate principal payments on long-term debt during the years
subsequent to December 31, 1996 are: 1997 -- $153,356; 1998 -- $131,360 and
1999 -- $8,369.

NOTE E DEFERRED INCOME

At December 31, 1996, deferred income in the amount of $120,600 consists of
funds received from a customer in advance of the deliverance of goods.

F-42
<PAGE>
HI-TECH COMPRESSOR COMPANY, L.C.
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

NOTE F RELATED PARTY TRANSACTIONS

Related party transactions and related balances with a member of Hi-Tech
and another company owned in part by such member are as follows:

DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ -------------
(UNAUDITED)
Accounts receivable, other........... $ 10,000 $10,000
Accounts receivable, Flare King, Inc.
("Flare King")..................... 28,717 12,556

NOTE G CONCENTRATION OF CREDIT RISK

Hi-Tech sells its products and services to the oil and gas industry in
Texas. Hi-Tech grants credit to customers, substantially all of whom are
commercial establishments located in the vicinity of the operating locations of
Hi-Tech.

NOTE H SUBSEQUENT EVENTS

In April, 1997, Hi-Tech signed a Letter of Intent with D.E. Frey & Company,
Inc., which provided for the members of Hi-Tech, along with the stockholders of
United Wellhead Services, Inc. ("Wellhead") and Flare King will exchange their
shares and equity interests through a business combination to form a new holding
company, United Oilfield Services, Inc. United Oilfield Services, Inc. intends
to proceed with an initial public offering (the "Offering") on a "best
efforts basis." There can be no assurances the Offering will be consummated.

Effective as of October 14, 1997, Wellhead and the equity holders of
Wellhead, Flare King and Hi-Tech (the "Founding Companies") entered into an
Agreement and Plan of Reorganization, which was subsequently amended. Pursuant
to the such agreement and simultaneously with and as a condition to the closing
of such agreement and the Offering, United Oilfield Services, Inc. will issue to
the holders (other than one of the Founding Companies) of the outstanding equity
interests in the Founding Companies shares of its Common Stock in exchange for
such equity interests (the "Reorganization"). There can be no assurances that
the Offering or the Reorganization will be consummated.

F-43

<PAGE>
NO PERSON HAS BEEN AUTHORIZED IN CONNECTION WITH THE OFFERING MADE HEREBY TO
GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE UNDERWRITER. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER
TO BUY ANY OF THE SECURITIES OFFERED HEREBY TO ANY PERSON OR BY ANYONE IN ANY
JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER
THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF.
------------------------

TABLE OF CONTENTS

PAGE
----
Prospectus Summary...................... 3
Risk Factors............................ 8
Selected Pro Forma Combined Financial
Data.................................. 12
Management's Discussion and Analysis of
Financial Condition and Results of
Operations............................ 14
Use of Proceeds......................... 18
Capitalization.......................... 19
Dividend Policy......................... 20
Dilution................................ 20
The Company............................. 21
The Reorganization...................... 29
Management.............................. 30
Certain Transactions.................... 33
Securities Ownership of Management and
Certain Beneficial Holders............ 35
Description of Securities............... 36
Shares Eligible for Future Sale......... 37
Underwriting............................ 39
Legal Matters........................... 40
Experts................................. 40
Additional Information.................. 40
Index to Financial Statements........... F-1

------------------------

UNTIL , 1998, ALL DEALERS EFFECTING TRANSACTIONS IN THE
REGISTERED SECURITIES, WHETHER OR NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE
REQUIRED TO DELIVER A PROSPECTUS. THIS REQUIREMENT IS IN ADDITION TO THE
OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND
WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

1,100,000 SHARES
[LOGO]
UNITED OILFIELD
SERVICES, INC.
COMMON STOCK

------------------------
PROSPECTUS
------------------------

D. E. FREY & COMPANY, INC.

, 1998

<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The expenses of this offering will be paid by United Oilfield Services,
Inc. (the "Registrant") and are estimated as follows:

SEC registration fee.................... $ 2,327
Listing fees............................ 10,000
Printing including engraving of share
certificates.......................... 50,000
Legal fees and expenses (including Blue
Sky).................................. 200,000
Accounting fees and expenses............ 25,000
Officer and director indemnification
insurance premiums.................... 25,000
Underwriting nonaccountable expenses
(other than commissions).............. 198,000
Miscellaneous........................... 49,673
----------
Total.............................. $ 560,000
==========

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Reference is made to Article 2.02-1 of the Texas Business Corporation Act
(the "TBCA"), which enables a corporation in its original articles of
incorporation or an amendment thereto to limit the personal liability of a
director to the corporation or its stockholders for monetary damages for breach
of the director's fiduciary duty, except (i) for any breach of the director's
duty of loyalty to the corporation and to its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) pursuant to article 2.38 of the TBCA (providing for
liability of directors for unlawful payment of dividends or unlawful stock
purchases or redemptions), or (iv) for any transaction from which the director
derived an improper personal benefit. The Registrant's Articles of Incorporation
contain provisions permitted by the TBCA.

The Registrant is incorporated under the laws of the State of Texas.
Section 2.02-1 of the TBCA provides that a Texas corporation may indemnify any
persons who are, or are threatened to be made, parties to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative, arbitrative or investigative (other than an action by or in the
right of such corporation), by reason of the fact that such person is or was an
officer, director, employee or agent of such corporation, or is or was serving
at the request of such corporation as a director, officer, employee or agent of
another corporation or enterprise. The indemnity may include expenses (including
attorneys' fees), judgments, penalties, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action,
suit or proceeding, provided such person acted in good faith and in a manner he
reasonably believed to be in or not opposed to the corporation's best interests
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe that his conduct was unlawful. Where an officer or director is
successful on the merits or otherwise in the defense of any action referred to
above, the corporation must indemnify him against the expenses which such
officer or director has actually and reasonably incurred.

Article Ten of the Registrant's Articles of Incorporation requires the
Registrant to indemnify the Registrant's directors to the maximum extent
permitted by the TBCA as set forth in the Registrant's Bylaws.

Section 6.10 of the Registrant's Bylaws provides that the Registrant shall
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding whether
civil, criminal, administrative, arbitrative or investigative (other than an
action by or in the right of the Registrant), by reason of the fact that he is
or was a director or officer of the Registrant, or is or was serving at the
request of the Registrant as a director, officer, partner, venturer, proprietor,
member, employee, trustee, agent or similar functionary of another domestic or
foreign corporation, employee benefit plan, other enterprise or other entity,
against expenses (including attorneys' fees), judgments, penalties,

II-1
<PAGE>
fines and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in good faith and in
a manner he reasonably believed to be in or not opposed to the best interests of
the Registrant and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The determination of
whether an incumbent or former director or officer is entitled to
indemnification because such officer or director has met the applicable
standards of conduct set forth above is to be made, unless ordered by a court:
(i) by a majority vote of a quorum consisting of directors who at the time of
the vote are not parties to the proceeding; (ii) if such quorum cannot be
obtained, by a majority vote of a committee of the Board of Directors,
consisting of disinterested members; (iii) by independent legal counsel in a
written opinion; or (iv) by a vote of disinterested shareholders of the
Registrant. The Bylaws further provide that the expenses (including attorneys'
fees) incurred in any such action by a director of officer of the Registrant may
be paid or reimbursed by the Registrant in advance of the final disposition of
such action, suit or proceeding upon receipt of a written undertaking by or on
behalf of the director or officer to repay the amount paid or reimbursed if it
is ultimately determined that he is not entitled to be indemnified by the
Registrant as authorized therein.

The Registrant's Bylaws also provide that the Registrant may indemnify to
the extent of the provisions set forth therein, any person, other than an
officer or director, who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative, arbitrative or investigative, by reason of the
fact that he is or was an employee or agent of the Registrant, or was serving at
the request of the Registrant as a director, officer, partner, venturer,
proprietor, member, employee, trustee, agent or similar functionary of another
domestic or foreign corporation, employee benefit plan, other enterprise or
other entity, if the Board determines that indemnification is appropriate and
the extent thereof.

The Registrant's Bylaws further provide that the indemnification described
therein is not exclusive, and shall not exclude any other rights to which the
person seeking to be indemnified may be entitled under statute, any bylaw,
agreement, vote of shareholders or disinterested directors, or otherwise, both
as to action in his official capacity and to his action in another capacity
while holding such office.

The Registrant intends to sign indemnification agreements with the
directors and executive officers of the Registrant and certain of its
subsidiaries certain of whose executive officers also perform policy-making
functions on behalf of the Registrant pursuant to which the Registrant will
indemnify them in accordance with the Registrant's Articles of Incorporation and
its Bylaws. The Registrant further intends to obtain insurance with respect to
such indemnification.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

Simultaneously with and as a condition to the consummation of the Offering,
the Registrant will issue shares of its Common Stock to the equity holders of
the Founding Companies. The issuance of the Registrant's Common Stock pursuant
to the negotiated Reorganization was accomplished without registration under the
Securities Act in reliance upon the exemption provided by Section 4(2) of the
Securities Act. See "The Reorganization" in Part I of this Registration
Statement.

ITEM 16. EXHIBITS

(a) Exhibits

EXHIBIT
NO. EXHIBIT
- ----------------------------------------------------------------
***1.1 -- Underwriting Agreement
**1.2 -- Form of Selected Dealer's Agreement
***1.3 -- Form of Underwriter's Warrant
**1.4 -- Form of Fund Escrow Agreement

II-2

<PAGE>

EXHIBIT
NO. EXHIBIT
- ----------------------------------------------------------------
*2 -- Agreement and Plan of Reorganization,
dated as of October 14, 1997 (the
"Agreement"), by and among United
Wellhead Services, Inc., the
Stockholders of United Wellhead
Services, Inc., the Stockholders of
Flare King, Inc., and the Equityholders
of Hi-Tech Compressor Company, L.C.
**2.1 -- First Amendment to Agreement and Plan of
Reorganization dated as of December 22,
1997
*3.1 -- Articles of Incorporation of United
Oilfield Services, Inc.
*3.2 -- Bylaws of United Oilfield Services, Inc.
**4 -- Form of certificate evidencing ownership
of Common Stock of United Oilfield
Services, Inc.
**5 -- Opinion of Winstead Sechrest & Minick
P.C.
**9 -- Proxy
*10.1 -- Loan Agreement, dated January 16, 1997,
between Community National Bank and
United Wellhead Services, Inc., for
$700,000 working capital line of credit.
*10.2 -- Commercial Revolving Note, dated June
19, 1997, made by Flare King, Inc. and
Wallace C. Sparkman in favor of Midland
American Bank, Midland, Texas, in the
principal amount of $150,000.
*10.3 -- Commercial Draw Note, dated June
19,1997, made by Flare King, Inc. and
Wallace C. Sparkman in favor of Midland
American Bank, Midland, Texas, in the
principal amount of $125,000.
*10.4 -- Loan Agreement, dated October 1, 1996,
between Norwest Bank Texas, Midland,
Texas and Hi-Tech Compressor Company,
L.C., for $425,000 revolving line of
credit.
*10.5 -- Loan Agreement, dated May 1, 1997,
between Norwest Bank Texas, Midland,
Texas and Hi-Tech Compressor Company,
L.C., for $250,000 revolving line of
credit.
*10.6 -- Preferred Stock Redemption and Loan
Agreement, dated August 27, 1997, by and
between United Wellhead Services, Inc.
and Gay A. Roane, in the principal
amount of $960,000.
*10.7 -- Installment Note, dated July 30, 1996,
made by United Wellhead Services, Inc.
in favor of J. Richard Espinosa, in the
principal amount of $135,000.
*10.8 -- Commercial Lease Agreement, dated June
6, 1994, by and between United Wellhead
Services, Inc. and J. Richard Espinosa.
*10.9 -- Commercial Lease Agreement, dated April
8, 1997, by and between United Wellhead X
Services, Inc. and Nolan J. Guidry.
*10.10 -- Commercial Lease Agreement, dated
effective as of January 1, 1997, by and
between United Wellhead Services, Inc.
and Bruce Graham Roberts, and others.
*10.11 -- Commercial Lease Agreement, dated March
2, 1994, by and between Hi-Tech
Compressor Company, L.C. and Tom
Jackson.
**10.12-- Exclusive Sales Agreement, dated
December 5, 1995, between Outwest
Unlimited and Rotary Gas Systems (dba of
Hi-Tech), and Notice of Assignment to
San Juan Compression, L.L.C., dated May
29, 1996
*10.13 -- 1997 Incentive Compensation Plan.
**10.14 -- Employment Agreement by and between
United Oilfield Services, Inc. and Alvin
H. Dueitt.
**10.15 -- Employment Agreement by and between
Flare King, Inc. and Burnace J. Boles,
Jr.
**10.16 -- Employment Agreement by and between
United Wellhead Services, Inc. and
Martin L. Tomlin
**10.17 -- Employment Agreement by and between
United Wellhead Services, Inc. and J.
Richard Espinosa
*21 -- List of Subsidiaries of United Oilfield
Services, Inc.
**23.1 -- Consent of Karlins Fuller Arnold &
Klodosky, P.C.
**23.2 -- Consent of Winstead Sechrest & Minick
P.C. (included in Exhibit 5)
*24 -- Power of Attorney
**27 -- Financial Data Schedule

- ------------

* Previously filed with this Registration Statement.
** Filed herewith.
*** Revised form to be filed by amendment.

II-3
<PAGE>

Disclosure schedules, exhibits and other appendices to the exhibits set
forth above have been omitted. Upon request, the Registrant undertakes to
furnish to the Securities and Exchange Commission a copy of any omitted
schedule, exhibit or other appendix.

(b) Financial Statement Schedules

All schedules for which provision is made in the applicable accounting
regulation of the Commission are not required under the related instructions,
are inapplicable or the information is included in the financial statements and
therefore have been omitted.

ITEM 17. UNDERTAKINGS

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions described in Item 15 above,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a directors, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement;

(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement.

(2) To provide to the Underwriter at the closing specified in the
underwriting agreements certificates in such denominations and
registered in such names as required by the Underwriter to permit
prompt delivery to each purchaser.

(3) (i) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the
form of prospectus filed as part of this registration
statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be
deemed to be part of this registration statement as of the
time it was declared effective.

(ii) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that
contains a form of prospectus shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering
thereof.

II-4
<PAGE>
SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS AMENDMENT NO. 1 TO THE REGISTRATION STATEMENT TO BE SIGNED
ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF
HOUSTON, STATE OF TEXAS, ON THE 9TH DAY OF JANUARY, 1998.

UNITED OILFIELD SERVICES, INC.
By: /s/ ALVIN H. DUEITT
ALVIN H. DUEITT
PRESIDENT AND CHIEF OPERATING
OFFICER

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
NO. 1 TO THE REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN
THE CAPACITIES INDICATED ON JANUARY 9, 1998.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ---------------------------------------- --------------------------------------------------------
<C> <S>
/s/ALVIN H. DUEITT President and Chief Operating Officer
ALVIN H. DUEITT (Principal Executive Officer)
/s/EARL R. WAIT Chief Accounting Officer and Secretary/Treasurer
EARL R. WAIT (Principal Accounting Officer)
/s/ALVIN H. DUEITT Director
ALVIN H. DUEITT
L. MELVIN COOPER* Director
L. MELVIN COOPER
CHARLES K. MILLER, JR.* Director
CHARLES K. MILLER, JR.
FRANCIS M. RICCI* Director
FRANCIS M. RICCI
WALLACE O. SELLERS* Director
WALLACE O. SELLERS
*By: /s/EARL R. WAIT
EARL R. WAIT,
ATTORNEY-IN-FACT
</TABLE>

II-5

EXHIBIT 1.2

A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION BUT HAS NOT YET BECOME EFFECTIVE. NO OFFER TO
BUY THE SECURITIES CAN BE ACCEPTED AND NO PART OF THE PURCHASE PRICE CAN BE
RECEIVED UNTIL THE REGISTRATION STATEMENT HAS BECOME EFFECTIVE, AND ANY SUCH
OFFER MAY BE WITHDRAWN OR REVOKED, WITHOUT OBLIGATION OR COMMITMENT OF ANY KIND,
AT ANY TIME PRIOR TO NOTICE OF ITS ACCEPTANCE GIVEN AFTER THE EFFECTIVE DATE.

UNITED OILFIELD SERVICES, INC.

SELECTED DEALERS AGREEMENT

December ___, 1997

Dear Ladies and Gentlemen:

1. GENERAL DESCRIPTION. D.E. FREY & COMPANY, INC., named as the
Underwriter in the enclosed Preliminary Prospectus ("We" or the "Underwriter"),
proposes to offer on a best efforts basis, subject to the terms and conditions
and execution of the Underwriting Agreement, 1,000,000 shares of the $0.01 par
value common stock (the "Shares") of UNITED OILFIELD SERVICES, INC. (the
"Company"). The Shares are more particularly described in the enclosed
Preliminary Prospectus, additional copies of which as well as the Prospectus
(after effective date) will be supplied in reasonable quantities upon request.

2. OFFER TO PARTICIPATE. The Underwriter invites your offer to participate
as a selected dealer in the offer of the Shares to be registered with the
Securities and Exchange Commission (the "Commission"), upon the terms and
conditions hereof. Shares are to be offered at a price of $_____ a share.
Selected Dealers will be allowed a concession of not less than ___% of the
offering price. You will be notified of the precise amount of such concession
prior to the effective date of the Registration Statement. The offer is
solicited subject to, and conditioned upon, acceptance by the Underwriter;
completion of the offering on a best efforts, all or nothing basis; and to the
approval of legal matters by counsel and to the terms and conditions as herein
set forth. You will be entitled only to the foregoing concessions upon meeting
the preceding conditions.

3. ACCEPTANCE. You, as a Selected Dealer, agree and acknowledge that you
will be and will act as a sub-agent for the Company and an agent for the
Underwriter to sell the Shares to your customers only as authorized by the
Underwriter and the Company. In all offers and sales of the Shares to proposed
purchasers, you shall act as agent for the Company in the transaction subject to
the terms and conditions contained in this

1
<PAGE>
Agreement, the Underwriting Agreement and the Registration Statement. You may
only make offers pursuant to the Preliminary Prospectus and sales pursuant to
the Final Prospectus and in compliance with Paragraph 10 of this Agreement.

4. UNDERTAKINGS. No person is authorized to give any information or to
make any representations concerning the Company or the Shares except those
contained in the Company's Final Prospectus. You agree to provide each proposed
purchaser with the Final Prospectus prior to making a sale. You agree not to use
any sales literature of any kind, other than the Preliminary and Final
Prospectus supplied by the Company, without prior written consent by the Company
and the Underwriter, or unless such sales literature is furnished to you by the
Company and the Underwriter for distribution to proposed purchasers. The
Underwriter agrees to provide you with reasonable quantities of the Preliminary
and Final Prospectuses.

5. LIMITATION. YOU MAY NOT ACCEPT, IN WHOLE OR IN PART, THE PURCHASE PRICE
OF SHARES FROM A PROPOSED PURCHASER UNTIL SUCH TIME AS THE REGISTRATION
STATEMENT HAS BEEN DECLARED EFFECTIVE BY THE COMMISSION. ANY PROCEEDS RECEIVED
FOR THE PURCHASE OF SHARES PRIOR TO THE REGISTRATION STATEMENT BEING DECLARED
EFFECTIVE BY THE COMMISSION WILL BE REJECTED, AND SUCH PROCEEDS WILL BE
IMMEDIATELY RETURNED TO THE PROPOSED PURCHASER.

6. OFFERING PRICE. Any of the Shares purchased pursuant to this Agreement
are to be at the public offering price, subject to the terms hereof. Shares
shall not be offered or sold by you below the public offering price before the
termination of this Agreement.

7. ESCROW ARRANGEMENTS. Unless all of the Shares, as set forth in the
Registration Statement and Prospectus, are sold within 30 days after the
Effective Date (which period may be extended for an additional period not to
exceed 30 days by mutual agreement between the Company and the Underwriter), the
agency between the Company and the Underwriter will terminate. If the agency
between the Company and the Underwriter terminates, the full proceeds which have
been paid for the Shares shall be returned to the purchasers and you will not be
entitled to any concession described in Paragraph 2. Prior to the sale of all of
the Shares, all proceeds received from the sale of the Shares will be deposited
into an escrow account entitled "United Oilfield Services, Inc. Escrow Account"
with Colorado State Bank and Trust, Denver, Colorado, as escrow agent (the
"Escrow Agent"). The Company, the Underwriter and the Escrow Agent, will, prior
to the beginning of the offering of the Shares, enter into a fund escrow
agreement, certain provisions of which will be binding upon you. On behalf of
the Underwriter, you agree to promptly deliver the funds along with the name(s)
and address of the proposed purchaser(s), to the Escrow Agent and otherwise
cooperate in such delivery and perform such other procedures as may be requested
by the Underwriter, in accordance with the escrow agreement and Rule 15(c)2-4 of
the Securities Exchange Act of 1934, as

2
<PAGE>
amended. Until all of the Shares are sold, you shall promptly, upon receipt of
any and all checks, drafts, and money orders received from prospective
purchasers of the Shares, deliver the same to the Escrow Agent by noon of the
next business day following the receipt, together with a written account of each
purchaser which sets forth, among other things, the name and address of the
purchaser, the number of Shares purchased and the amount paid therefor. Any
checks, drafts or money orders received which are made payable to any party
other than the Escrow Agent shall be returned to the purchaser who submitted the
check and not accepted. Certificates for the securities shall be delivered as
soon as practicable after delivery instructions are received by the Underwriter.

8. PAYMENT. No commission will be paid by the Company or concessions
allowed to you unless and until the all of the Shares have been sold and the
terms of the Fund Escrow Agreement have been met.

9. REGISTRATION. A registration statement covering the offering has been
filed with the Commission with respect to the Shares. You will be promptly
advised when the registration statement becomes effective. Each Selected Dealer
in selling Shares pursuant hereto agrees (which agreement shall also be for the
benefit of the Company) that it will comply with the applicable requirements of
the Securities Act of 1933 and of the Securities Exchange Act of 1934 and any
applicable rules and regulations issued under said Acts. No person is authorized
by the Company or by the Underwriter to give any information or to make any
representations other than those contained in the Prospectus in connection with
the sale of the Shares.

10. BLUE SKY. We will inform you, in writing, of which states the Company
has filed applications to qualify or register the Shares, or as to the states in
which the offer of the Shares is exempt from qualification or registration. You
may deliver Preliminary Prospectuses only to residents of such states.
Furthermore, upon the Registration Statement being declared effective by the
Commission, we will inform you, in writing, of the states in which the Shares
have been qualified or registered, or as to the states in which the sale of the
Shares is exempt from qualification or registration. You shall deliver the Final
Prospectus and make sales solely to residents of such states. Sales will not be
accepted from residents of states in which the Shares have not been qualified,
registered, or exempt from qualification or registration. You agree that you
will take appropriate measures, and perform appropriate due diligence, to
reasonably ensure that offers and sales of the Shares are made only to
purchasers in compliance with this paragraph. A sale may be made only after
delivery of the Final Prospectus to the prospective investor.

11. UNDERWRITER'S AUTHORITY. The Underwriter shall have full authority to
take such action as it may deem advisable in respect of all matters pertaining
to the offering or arising thereunder. The Underwriter shall not be under any
liability to you, except such as may be incurred under the Securities Act of
1933 and the rules and regulations thereunder,

3
<PAGE>
except for lack of good faith and except for obligations assumed by us in this
Agreement, and no obligation on our part shall be implied or inferred herefrom.

12. REPRESENTATIONS OF THE SELECTED DEALERS. You represent that you are a
member in good standing of the NASD, you are registered as a broker-dealer with
the Commission and you are either registered, or exempt from such registration,
as a broker-dealer in all states in which you have or will make offers or sales
of the Shares. Your attention is called to the following: (a) The Conduct Rules
of the NASD and the interpretations of such Rules, including the interpretation
with respect to "Free-Riding and Withholding"; ( b) Section 10(b) of the 1934
Act and Rules 10b-6 and 10b-10 of the general rules and regulations promulgated
under said Act; (c) Securities Act Release #3907; (d) Securities Act Release
#4150; and (e) Securities Act Release #4968 requiring the distribution of a
Preliminary Prospectus to all persons reasonably expected to be purchasers of
shares from you at least 48 hours prior to the time you expect to mail
confirmations. By signing this Agreement, you acknowledge that you are familiar
with the cited law, rules and releases, and agree that you will not directly
and/or indirectly violate any provisions of applicable law in connection with
your participation in the distribution of the Shares.

13. LIMITATIONS ON SECONDARY TRADING. In addition to compliance with the
provisions of Paragraph 12 hereof, you will not bid, until advised by us in
writing or by wire that the entire offering has been distributed and closed, for
or purchase Shares in the open market or otherwise make a market in the Shares
or otherwise attempt to induce others to purchase shares in the open market.
Nothing contained in this Paragraph 13 shall, however, preclude you from acting
as agent in the execution of unsolicited orders of customers in transactions
effectuated for them through a market maker.

14. INDEMNIFICATION BY SELECTED DEALER. You agree to indemnify and hold
harmless the Company, its agents, officers, directors, employees and each person
who controls the Company within the meaning of either Section 15 of the Act or
Section 20 of the Securities Exchange Act of 1934 from and against any and all
losses, claims, damages, liabilities or expenses, joint or several, (including
reasonable legal or other expenses incurred by each such person in connection
with defending or investigating any such claims or liabilities, whether or not
resulting in any liability to such person) which they or any of them may incur
and to reimburse persons indemnified as above for any legal or other expense
(including the cost of any investigation and preparation) incurred by any of
them in connection with any investigation, mediation, arbitration, litigation,
or other proceeding, whether or not resulting in any liability, but only insofar
as such losses, claims, damages, liabilities and litigation arise out of or are
based upon a breach by you of any provision of this Agreement. This indemnity
agreement is in addition to any other liability which the Selected Dealer may
otherwise have to the Company and other indemnified persons.

4
<PAGE>
15. COMPANY'S INDEMNIFICATION. The Company shall indemnify and hold
harmless each Selected Dealer and their respective officers, directors,
employees and agents against any and all loss, claim, damage or liability, joint
or several, to which such Selected Dealer or such person ("covered person") may
become subject, under the Act or otherwise, insofar as such loss, claim, damage,
or liability (or action with respect thereto) arises out of or is based upon (a)
any violation of any registration requirements; (b) any improper use of sales
literature by the Company; (c) any untrue statement or alleged untrue statement
of a material fact contained (i) in the Registration Statement, any Preliminary
Prospectus or the Final Prospectus or any amendment or supplement thereto, or
(ii) in any application or other document, executed by the Company specifically
for such application or based upon written information furnished by the Company,
filed in order to qualify the Shares under the securities laws of the states
where filings were made (any such application, document, or information being
hereinafter called "Blue Sky Application"); or (d) the omission or alleged
omission to state in the Registration Statement, any Preliminary Prospectus, the
Final Prospectus or any amendment or supplement thereto or in any Blue Sky
Application a material fact required to be stated therein or necessary to make
the statements therein not misleading. The Company shall reimburse the Selected
Dealer or covered person for any legal or other reasonable expenses incurred by
such Selected Dealer or covered person in connection with investigating or
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action, notwithstanding the possibility
that payments for such expenses might later be held to be improper, in which
case the person receiving them shall promptly refund them; except that the
Company shall not be liable in any such case to the extent, but only to the
extent, that any such loss, claim, damage, or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with written
information furnished to the Company through the Selected Dealer or the
Underwriter specifically for use in the preparation of the Registration
Statement, any Preliminary Prospectus, and the Final Prospectus or any amendment
or supplement thereto, or any Blue Sky Application.

16. CONTRIBUTION. If the indemnification provided for in paragraphs 14 and
15 of this Agreement is unavailable or insufficient to hold harmless an
indemnified party, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of the losses, claims,
damages, or liabilities referred to in paragraphs 14 or 15 above (a) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Selected Dealer on the other from the offering
of the Shares; or (b) if the allocation provided by clause (a) above is not
permitted by applicable law, in such proportion as is appropriate to reflect the
relative benefits referred to in clause (a) above but also the relative fault of
the Company on the one hand and the Selected Dealer on the other in connection
with the statements or omissions which resulted in such losses, claims, damages,
or liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Selected Dealer shall be
deemed to be in the same proportion as the total net proceeds from the offering

5
<PAGE>
(before deducting expenses) received by the Company bear to the total commission
received by the Selected Dealer. Relative fault shall be determined by reference
to, among other things, whether the untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
Company, the Underwriter or the Selected Dealer and the parties' relative
intent, knowledge, access to information, and opportunity to correct or prevent
such untrue statement or omission. For purposes of this Paragraph 16, the term
"damages" shall include any counsel fees or other expenses reasonably incurred
by the Company or the Selected Dealer in connection with investigating or
defending any action or claim which is the subject of the contribution
provisions of this Paragraph 16. No person adjudged guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act of
1933) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.

Each party entitled to contribution agrees that upon the service of a
summons or other initial legal process upon it in any action instituted against
it in respect of which contribution may be sought, it shall promptly give
written notice of such service to the party or parties from whom contribution
may be sought, but the omission so to notify such party or parties of any such
service shall not relieve the party from whom contribution may be sought from
any obligation it may have hereunder or otherwise.

17. NOTICES. All communications from you should be directed to D.E. Frey &
Company, Inc., 1700 Lincoln Street, Suite 2200, Denver, Colorado 80203,
telephone: (303) 863-4040, Attention ____________________. All communications
from us to you shall be directed to the address to which this letter is mailed.

Very truly yours,

D.E. FREY & COMPANY, INC.

By:__________________________
Dale E. Frey, President

Confirmed ___________________, 19______

_______________________________________

By: ______________________________
(sign name and print name and title)

EXHIBIT 2.1

FIRST AMENDMENT

AGREEMENT AND PLAN OF REORGANIZATION

BY AND AMONG

UNITED WELLHEAD SERVICES, INC.,

THE STOCKHOLDERS OF UNITED WELLHEAD SERVICES, INC.,

THE STOCKHOLDERS OF FLARE KING, INC.

AND

THE EQUITYHOLDERS OF HI-TECH COMPRESSOR
COMPANY, L.C.

AS OF DECEMBER 22, 1997
<PAGE>
FIRST AMENDMENT TO
AGREEMENT AND PLAN OF REORGANIZATION

This FIRST AMENDMENT TO AGREEMENT AND PLAN OF REORGANIZATION (the
"First Amendment"), dated as of December 22, 1997 is by and among United
Wellhead Services, Inc., a Texas corporation (the "Company"), the stockholders
("Company Stockholders") of the Company, the stockholders ("FK Stockholders") of
Flare King, Inc., a Texas corporation ("Flare King"), and the equityholders ("HT
Equityholders") of Hi-Tech Compressor Company, L.C., a Texas limited liability
company ("Hi-Tech"), as identified on the signature pages hereto.

W I T N E S S E T H:

WHEREAS, the Company, the Company Stockholders, the FK Stockholders and
the HT Equityholders entered into an Agreement and Plan of Reorganization as of
October 14, 1997 (the "Original Agreement") pursuant to which it is their intent
to effect a rollup of the three entities and initially capitalized terms used
herein and not defined shall have the meanings ascribed thereto in the Original
Agreement;

WHEREAS, based on economic performance of the parties for 1997, the
parties have agreed to modify the allocation to the parties of Parent Common
Stock as set forth herein;

NOW, THEREFORE, in consideration of the mutual premises, covenants and
agreements set forth herein and in reliance upon the representations and
warranties contained herein, the parties hereto covenant and agree as follows:

1. The first sentence of Section 1.3 of the Original Agreement is hereby amended
to read in its entirety as follows:

As set forth in detail on Schedule 1, as consideration for the Company
Contribution to the Parent, the Company Stockholders, the FK
Stockholders and the HT Equityholders (collectively, the "Founders")
shall cause the Parent to issue to each Company Stockholder (other than
Hi-Tech) 5.068638 shares of common stock of the Parent, $.01 par value
per share (the "Parent Common Stock"), for each share of Company common
stock held by such Company Stockholder as of 12:01 a.m. on the Funding
and Consummation Date (as hereinafter defined).

2. The first sentence of Section 1.4 of the Original Agreement is
hereby amended to read in its entirety as follows:

As set forth in detail on Schedule 1, as consideration for the Flare
King Contribution to the Parent, the Founders shall cause the Parent to
issue to (i) Diamente Investments, L.P. ("Diamente"), as an FK
Stockholder, 214,204 shares of Parent Common Stock in exchange for the
79,592 shares of common stock of Flare King held by Diamente as of
12:01 a.m. on the Funding and Consummation Date and (ii)
<PAGE>
Naudain Ives Sellers ("Mrs. Sellers"), 90,112 shares of Parent Common
Stock in exchange for the 31,863 shares of common stock of Flare King
held by Mrs. Sellers as of 12:01 a.m. on the Funding and Consummation
Date.

3. The first sentence of Section 1.5 of the Original Agreement is
hereby amended to read in its entirety as follows:

As set forth in detail on Schedule 1, as consideration for the Hi-Tech
Contribution to the Parent, the Founders shall cause the Parent to
issue to each HT Equityholder (other than Flare King) 3,105.18 shares
of Parent Common Stock for each percent of membership interest of
Hi-Tech held by such HT Equityholder as of 12:01 a.m. on the Funding
and Consummation Date.

4. Schedule 1 to the Original Agreement is deleted in its entirety and
replaced with Schedule 1 to this First Amendment.

5. As contemplated in Section 17.11 of the Original Agreement, Wallace
C. Sparkman transferred his interest in the Company and Flare King to Diamente
Investments, L.P. which is hereby substituted in lieu of Wallace C. Sparkman as
a party to the Original Agreement and the First Amendment for all purposes.

6. Except as set forth above, all of the terms and provisions of the
Original Agreement shall remain in full force and effect.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of December 22, 1997.

COMPANY:

UNITED WELLHEAD SERVICES, INC.:

By: /s/ ALVIN H. DUEITT
Alvin H. Dueitt, President

THE COMPANY STOCKHOLDERS:

/s/ Alvin H. Dueitt

2
<PAGE>
/s/ Martin L. Tomlin

DIAMENTE INVESTMENTS, L.P.

By: /s/ WALLACE C. SPARKMAN
Wallace C. Sparkman
General Partner

/s/ Wallace O. Sellers

/s/ William M. Duncan

/s/ J. Richard Espinosa

/s/ Eugene Grummer

/s/ Gary W. Boening

/s/ Scott Sparkman

3
<PAGE>
/s/ John H. Briscoe

/s/ Terry L. Boening

/s/ Thomas R. Pipes

/s/ Earl R. Wait

/s/ HI-TECH COMPRESSOR COMPANY, L.C.:

By: /s/ WAYNE L. VINSON
Wayne L. Vinson, President

THE FK STOCKHOLDERS:

DIAMENTE INVESTMENTS, L.P.

By: /s/ WALLACE C. SPARKMAN
Wallace C. Sparkman
General Partner

4
<PAGE>
/s/ Naudain Ives Sellers

THE HT EQUITYHOLDERS:

FLARE KING, INC.:

By: /s/ BURNACE J. BOLES
Burnace J. Boles, Jr., President

/s/ Richard L. Yadon

CAV-RDV, LTD.:

By: General Partner

Executed by United Oilfield Services, Inc. for purposes of
acknowledging its rights hereunder and of agreeing to carry out each action
required of it as contemplated hereunder.

UNITED OILFIELD SERVICES, INC.

By: /s/ ALVIN H. DUEITT
Alvin H. Dueitt
President

5
<PAGE>
STATE OF ss.
ss.

COUNTY OF ss.

On this the _____ day of _______________, 1997, before me, the
undersigned officer, personally appeared Alvin H. Dueitt, who acknowledged
himself to be the President of United Wellhead Services, Inc., a corporation,
and that he, as such officer being authorized so to do, executed the foregoing
instrument for the purposes therein contained, by signing the name of the
corporation by himself as President.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public

STATE OF ss.
ss.

COUNTY OF ss.

On this the _____ day of _______________, 1997, before me, the
undersigned officer, personally appeared Alvin H. Dueitt, known to me (or
satisfactorily proven) to be the person whose name is subscribed to the within
instrument and acknowledged that he executed the same for the purposes therein
contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public

6
<PAGE>
STATE OF TEXAS ss.
ss.

COUNTY OF NEUCES ss.

On this the 5 day of January, 1997, before me, the undersigned officer,
personally appeared Martin L. Tomlin, known to me (or satisfactorily proven) to
be the person whose name is subscribed to the within instrument and acknowledged
that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.
/s/ DEBRA SCHWERTNER
Notary Public

STATE OF TEXAS ss.
ss.

COUNTY OF MIDLAND ss.

On this the 31 day of December, 1997, before me, the undersigned
officer, personally appeared Wallace C. Sparkman, who acknowledged himself to be
a General Partner of Diamente Investments, L.P., a limited partnership, and that
he, as such General Partner being authorized so to do, executed the foregoing
instrument for the purposes therein contained, by signing the name of the
limited partnership by himself as the General Partner.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ PEGGY SWAILS

7
<PAGE>
STATE OF PENNSYLVANIA ss.
ss.

COUNTY OF BUCKS ss.

On this the 31 day of December, 1997, before me, the undersigned
officer, personally appeared Wallace O. Sellers, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/WENDY A. CLEARY
STATE OF TEXAS ss.
ss.

COUNTY OF KLEBERG ss.

On this the 31 day of December, 1997, before me, the undersigned
officer, personally appeared William M. Duncan, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ ELVA V. LOPEZ

8
<PAGE>
STATE OF ss.
ss.

COUNTY OF ss.

On this the _____ day of _______________, 1997, before me, the
undersigned officer, personally appeared J. Richard Espinosa, known to me (or
satisfactorily proven) to be the person whose name is subscribed to the within
instrument and acknowledged that he executed the same for the purposes therein
contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public

STATE OF VERMONT ss.
ss.

COUNTY OF CHITTENDEN ss.

On this the 2nd day of January, 1997, before me, the undersigned
officer, personally appeared Eugene Grummer, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ PRISCILLA L. HILL
9
<PAGE>
STATE OF TEXAS ss.
ss.

COUNTY OF NUECES ss.

On this the 31 day of December, 1997, before me, the undersigned
officer, personally appeared Gary W. Boening, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ JUDY B. GALLAGHER
STATE OF TEXAS ss.
ss.

COUNTY OF NUECES ss.

On this the 31 day of December, 1997, before me, the undersigned
officer, personally appeared Scott Sparkman, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/LUDIE A. LITZ
10
<PAGE>
STATE OF TEXAS ss.
ss.

COUNTY OF HARRIS ss.

On this the 31 day of December, 1997, before me, the undersigned
officer, personally appeared John H. Briscoe, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ DENISE SCALES
STATE OF TEXAS ss.
ss.

COUNTY OF FORT BEND ss.

On this the 31 day of December, 1997, before me, the undersigned
officer, personally appeared Terry L. Boening, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ LAURIE SPANO
11
<PAGE>
STATE OF TEXAS ss.
ss.

COUNTY OF MIDLAND ss.

On this the 31 day of December, 1997, before me, the undersigned
officer, personally appeared Thomas R. Pipes, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same for the purposes therein contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ JANA KRAUS
STATE OF TEXAS ss.
ss.

COUNTY OF NUECES ss.

On this the 31 day of December, 1997, before me, the
undersigned officer, personally appeared Earl R. Wait, known to me (or
satisfactorily proven) to be the person whose name is subscribed to the within
instrument and acknowledged that he executed the same for the purposes therein
contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ LAVERNE SMITH
12
<PAGE>
STATE OF TEXAS ss.
ss.

COUNTY OF MIDLAND ss.

On this the 2 day of January, 1997, before me, the
undersigned officer, personally appeared Wayne L. Vinson, who acknowledged
himself to be the President of Hi-Tech Compressor Company, L.C., a limited
liability company, and that he, as such officer being authorized so to do,
executed the foregoing instrument for the purposes therein contained, by signing
the name of the company by himself as President.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ JOSIE M. MADRID
STATE OF PENNSYLVANIA ss.
ss.

COUNTY OF BUCKS ss.

On this the 31 day of December, 1997, before me, the
undersigned officer, personally appeared Naudain Ives Sellers, known to me (or
satisfactorily proven) to be the person whose name is subscribed to the within
instrument and acknowledged that she executed the same for the purposes therein
contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ WENDY A. CLEARY
13
<PAGE>
STATE OF TEXAS ss.
ss.

COUNTY OF MIDLAND ss.

On this the 31 day of December, 1997, before me, the
undersigned officer, personally appeared Burnace J. Boles, Jr., who acknowledged
himself to be the President of Flare King, Inc., a corporation, and that he, as
such officer being authorized so to do, executed the foregoing instrument for
the purposes therein contained, by signing the name of the corporation by
himself as President.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ PEGGY SWAILS
STATE OF TEXAS ss.
ss.

COUNTY OF MIDLAND ss.

On this the 31 day of December, 1997, before me, the
undersigned officer, personally appeared Richard L. Yadon, known to me (or
satisfactorily proven) to be the person whose name is subscribed to the within
instrument and acknowledged that he executed the same for the purposes therein
contained.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ CHRISTY MUEHLBRAD
14
<PAGE>
STATE OF TEXAS ss.
ss.

COUNTY OF MIDLAND ss.

On this the 2 day of January, 1997, before me, the
undersigned officer, personally appeared Kirk Mchaffey, who
acknowledged himself to be the General Partner of CAV-RDV, Ltd., a limited
partnership, and that he, as such General Partner being authorized so to
do, executed the foregoing instrument for the purposes therein contained, by
signing the name of the limited partnership by himself as General Partner.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public
/s/ JOSIE M. MADRID
STATE OF ss.
ss.

COUNTY OF ss.

On this the _____ day of _______________, 1997, before me, the
undersigned officer, personally appeared Alvin H. Dueitt, who acknowledged
himself to be the President of United Oilfield Services, Inc., a corporation,
and that he, as such officer being authorized so to do, executed the foregoing
instrument for the purposes therein contained, by signing the name of the
corporation by himself as President.

IN WITNESS WHEREOF I hereby set my hand and official seal.

Notary Public

EXHIBIT 4

<TABLE>
<CAPTION>
<S> <C> <C>
NUMBER UOS SHARES
00 UNITED OILFIELD SERVICES, INC. __________
COMMON STOCK SEE REVERSE CERTAIN DEFINITIONS

CUSIP 911263 10 1

INCORPORATED UNDER THE LAWS OF THE STATE OF TEXAS

THIS CERTIFIES THAT

IS THE OWNER OF

FULLY PAID NON-ASSESSABLE SHARES OF THE PAR VALUE OF ONE CENT ($0.01) EACH OF THE COMMON STOCK OF

United Oilfield Services, Inc. transferable on the books of the Corporation by the holder
hereof in person or by duly authorized attorney upon surrender of this Certificate properly endorsed.
This Certificate and the shares represented hereby are issued and shall be subject to all of the
provisions of the Articles of Incorporation of the Corporation as now or hereafter amended, which
are incorporated herein by reference in their entirety. This Certificate is not valid unless
countersigned by the Transfer Agent and registered by the Registrar.

WITNESS the facsimile seal of the Corporation and the signatures of its duly authorized officers.

Dated:

[United Oilfield Earl R. Wait Alvin H. Dueitt
Services, Inc. SECRETARY PRESIDENT
SEAL]

COUNTERSIGNED AND REGISTERED:
AMERICAN SECURITIES TRANSFER & TRUST, INC.
P.O. Box 1596, Denver, Colorado 80201

TRANSFER AGENT AND REGISTRAR AUTHORIZED SIGNATURE

AMERICAN BANK NOTE COMPANY DEC 5, 1997 fm
3504 ATLANTIC AVENUE
SUITE 12
LONG BEACH, CA 90807 O54113fc
(562) 989-2333
(FAX) (582)426-7450 7B NEW
<PAGE>
UNITED OILFIELD SERVICES, INC.

THE ARTICLES OF INCORPORATION OF THE CORPORATION ON FILE IN THE OFFICE OF THE SECRETARY OF
STATE OF TEXAS SET FORTH A FULL STATEMENT OF (A) ALL OF THE DESIGNATIONS, PREFERENCES, LIMITATIONS
AND RELATIVE RIGHTS OF THE SHARES OF EACH CLASS OF SHARES AUTHORIZED TO BE ISSUED AND (B) THE AUTHORITY
OF THE BOARD OF DIRECTORS TO FIX AND DETERMINE THE RELATIVE RIGHTS AND PREFERENCES OF THE SHARES OF
PREFERRED STOCK THAT THE CORPORATION IS AUTHORIZED TO ISSUE IN SERIES AND, IF AND TO THE EXTENT THAT
THEY HAVE BEEN FIXED AND DETERMINED, THE RELATIVE RIGHTS AND PREFERENCES OF ANY SUCH SERIES. THE
CORPORATION WILL FURNISH A COPY OF SUCH STATEMENT TO THE RECORD HOLDER OF THIS CERTIFICATE WITHOUT
CHARGE ON WRITTEN REQUEST TO THE CORPORATION AT ITS PRINCIPLE PLACE OF BUSINESS OR REGISTERED OFFICE.

THE ARTICLES OF INCORPORATION OF THE CORPORATION ON FILE IN THE OFFICE OF THE SECRETARY OF STATE OF
TEXAS SET FORTH A FULL STATEMENT OF THE DENIAL OF PREEMPTIVE RIGHTS OF SHAREHOLDERS. THE CORPORATION WILL
FURNISH A COPY OF SUCH STATEMENT TO THE RECORD HOLDER OF THIS CERTIFICATE WITHOUT CHARGE ON WRITTEN
REQUEST TO THE CORPORATION AT ITS PRINCIPAL PLACE OF BUSINESS OR REGISTERED OFFICE.

The following abbreviations, when used in the inscription on the face of this certificate, shall be
construed as though they were written out in full according to applicable laws or regulations:

TEN COM -- as tenants in common UNIF GIFT MIN ACT --______Custodian______
TEN ENT -- as tenants by the entireties (Cust) (Minor)
JT TEN -- as joint tenants with right Under Uniform Gifts to Minors
of survivorship and not as Act___________________________
tenants in common (State)

Additional abbreviations may also be used though not in the above list.

ASSIGNMENT

For Value Recieved,______________________________________hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
______________________________
|____________________________|___________________________________________________________________

_________________________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE, OF ASSIGNEE

_________________________________________________________________________________________________

__________________________________________________________________________________________ Shares
of the capital stock represented by the within Certificate, and do hereby irrevocably constitute
and appoint

_________________________________________________________________________________________ Attorney
to transfer the said stock on the books of the within-named Corporation, with full power of substitution
in the premises.

Dated ___________________________________
X____________________________________________________
NOTICE (SIGNATURE)
THE SIGNATURE(S) TO THIS ASSIGMENT MUST
CORRESPOND WITH THE NAME(S) AS WRITTEN
UPON THE FACE OF THE CERTIFICATE WITHOUT---------->
ALTERATION OR ANY CHANGE WHATEVER. X_____________________________________________________
(SIGNATURE)
___________________________________________________________
|THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE |
|GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND |
|LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN|
|APPROVED SIGNATURE GUARANTEE PROGRAM), PURSUANT TO S.E.C.|
| RULE 17Ad-15. |
|_________________________________________________________|
|SIGNATURE(S) GUARANTEED BY: |
| |
| |
| |
| |
|_________________________________________________________|

AMERICAN BANK NOTE COMPANY DEC 5, 1997 se
3504 ATLANTIC AVENUE
SUITE 12
LONG BEACH, CA 90807 O54113bk
(562) 989-2333
(FAX) (582)426-7450 Proof____ NEW
</TABLE>

Exhibit 5

2400 Bank One Center WINSTEAD (713)650-8400
910 Travis Street SECHREST Telecopier (713)650-2400
Houston, Texas 77002-5895 & MINICK
A Professional Direct Dial: (713)650-2727
DALLAS HOUSTON AUSTIN Corporation [email protected]
MEXICO CITY Attorneys & Counselors

January 7, 1998

The Board of Directors
United Oilfield Services, Inc.
615 Upper North Broadway, Suite 950, MT-198
Corpus Christi, Texas 78477

Gentlemen:

You have requested our opinion as to the legality of the issuance of
1,100,000 shares (the "Shares") of the common stock, $.01 par value per share,
of United Oilfield Services, Inc. (the "Company"), which are the subject of a
registration statement on Form S-1 (the "Registration Statement") filed by the
Company with the Securities and Exchange Commission pursuant to the Securities
Act of 1933, as amended. You have requested our opinion as to whether the Shares
to be issued will, when issued, be duly and validly issued, fully paid and
nonassessable.

We have examined the Articles of Incorporation of the Company, the
Bylaws and such other corporate records, documents and proceedings and the
resolutions adopted by the Board of Directors of the Company in connection with
the issuance, sale and delivery of the Shares as we have deemed necessary for
the purposes of this opinion.

On the basis of the foregoing, it is our opinion that the Shares to be
issued and sold by the Company pursuant to the Registration Statement have been
duly and validly authorized by all necessary corporate action of the Company,
and each of such Shares will, when so issued, be duly and validly issued, fully
paid and nonassessable shares of common stock of the Company.

We hereby consent to the use of our name in the Registration Statement
and to the filing of this opinion as an exhibit to the Registration Statement.

Very truly yours,

WINSTEAD SECHREST & MINICK P.C.

By: /s/ R. CLYDE PARKER, JR.
R. Clyde Parker, Jr.
FOR THE FIRM

IRREVOCABLE PROXY

WHEREAS, Wallace C. Sparkman ("Sparkman"), a shareholder of United
Wellhead Services, Inc., a Texas corporation ("Wellhead"), and Flare King, Inc.,
a Texas corporation ("Flare King"), Wellhead, the other stockholders of
Wellhead, the other stockholder of Flare King, and the equityholders of Hi-Tech
Compressor Company, L.C., a Texas limited liability company ("Hi-Tech"), have
entered into that certain Agreement and Plan of Reorganization dated October 14,
1997 (the "Agreement"), to effect the rollup of Wellhead, Flare King, and
Hi-Tech, as wholly owned subsidiaries of United Oilfield Services, Inc., a Texas
corporation (the "Company");

WHEREAS, Sparkman (i) has transferred his ownership interest in Wellhead
and Flare King and his rights and interests under the Agreement to Diamente
Investments, L.P., a Texas family limited partnership ("Diamente"), (ii) has
elected to retire from all formal and informal positions with Wellhead, Flare
King and Hi-Tech, and (iii) will not serve as an officer or director of the
Company; and

WHEREAS, Diamente shall receive a certain number of shares of common
stock (the "Common Stock") of the Company upon the Funding and Consummation
Date, as such term is defined in the Agreement, in exchange for shares of common
stock of Wellhead and Flare King;

WHEREAS, the Company is currently in the process of effecting an initial
public offering (the "IPO") of the Company's Common Stock pursuant to a
Registration Statement on Form S-1 with the Securities and Exchange Commission
in connection therewith; and

WHEREAS, Diamente desires to execute this Irrevocable Proxy to appoint
the Board of Directors of the Company as its lawful proxy pursuant to the terms
hereunder.

NOW, THEREFORE, for Ten Dollars cash in hand paid and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, as an inducement for the consummation of the Agreement by all the
parties thereto, and in recognition of the reliance on this Irrevocable Proxy by
the participants in the IPO, the foregoing effectively coupling this proxy with
an interest, Diamente hereby appoints each such individual who has from time to
time been appointed or may be acting as Chairman of the Board of the Company (or
other authorized designee) as its lawful proxy with respect to the Common Stock,
with full power of substitution to vote at any time the number of votes which
the undersigned would be entitled to cast if represented personally with respect
to any matter, as such proxy may be directed by the Board of Directors (as set
forth below), acting by majority vote at a duly convened and constituted meeting
at which a quorum is present; and that such power be irrevocable until and shall
terminate only at such time as Diamente's ownership interest in the Company (or
if Diamente shall be dissolved, the ownership interest of Wallace C. Sparkman
and Patsy Sparkman) becomes less than five percent (5%) of the total outstanding
Common Stock of the Company. If a majority of the Board of Directors is made up
of independent directors, the Chairman (or other authorized designee) will vote
such shares in accordance with the direction of a majority of the directors in
attendance at such meeting. If a majority of the Board of Directors is not made
up of independent directors, the Chairman (or other authorized designee)
<PAGE>
will vote such shares in accordance with the direction of a majority of the
independent directors in attendance at such meeting. Independent directors shall
be directors deemed to be independent pursuant to the federal securities laws of
the United States of America.

Nothing contained in this Irrevocable Proxy shall limit or restrict the
investment powers of Diamente.

IN WITNESS WHEREOF, Diamente Investments, L.P. has caused this
Irrevocable Proxy to be executed effective as of October 22, 1997.

DIAMENTE INVESTMENTS, L.P. Acknowledged:

By: /s/ WALLACE C. SPARKMAN /s/ WALLACE C. SPARKMAN
Wallace C. Sparkman, General Partner Wallace C. Sparkman, Individually

DIAMENTE INVESTMENTS. L.P. Acknowledged:

By: /s/ PATSY SPARKMAN /s/ PATSY SPARKMAN
Patsy Sparkman, General Partner Patsy Sparkman, Individually

STATE OF TEXAS

COUNTY OF NUECES

BEFORE ME, the undersigned, a Notary Public in and for said State, on
this day personally appeared Wallace C. Sparkman, a General Partner of Diamente
Investments. L.P., acting as such and individually, who is a person known to me
to be at least eighteen (18) years of age and the person whose name is
subscribed to the foregoing instrument, and acknowledged to me that he executed
the same for the purposes and consideration therein expressed.

GIVEN UNDER MY HAND AND SEAL OF OFFICE this 23rd day of October, 1997.

[SEAL] LAVERNE SMITH /s/ LAVERNE SMITH
Notary Public Notary Public
STATE OF TEXAS in and for the State of Texas
My Comm. Exp. March 25, 2001
<PAGE>
STATE OF TEXAS

COUNTY OF NUECES

BEFORE ME, the undersigned, a Notary Public in and for said State, on
this day personally appeared Patsy Sparkman, a General Partner of Diamente
Investments, L.P., acting as such and individually, who is a person known to me
to be at least eighteen (18) years of age and the person whose name is
subscribed to the foregoing instrument, and acknowledged to me that she executed
the same for the purposes and consideration therein expressed.

GIVEN UNDER MY HAND AND SEAL OF OFFICE this 23rd day of October, 1997.

[SEAL] LAVERNE SMITH /s/ LAVERNE SMITH
Notary Public Notary Public
STATE OF TEXAS in and for the State of Texas
My Comm. Exp. March 25, 2001

EXHIBIT 10.12

EXCLUSIVE SALES AGREEMENT

1. Outwest Unlimited, or it's assigns, shall have the exclusive rights to
the Farmington, NM area for selling Rotary Gas Systems compressor
units. This area will encompass a 300 mile radius. In the event
Outwest Unlimited purchases a rental fleet they shall have the
exclusive rental rights as well. A rental fleet shall be defined as a
minimum of 50 units on rental or available for rental.

2. This area shall remain exclusive as long as Outwest Unlimited
purchases from and/or sells a minimum of 12 Rotary Gas Systems units
the first year and shall have sold a minimum of 72 units by the end of
second year. This two year period shall start January 11, 1996.

3. Following the first year, Outwest Unlimited must buy at least 36 units
per year to maintain exclusive territory rights. After 180 units have
been purchased the territory shall remain exclusive regardless of
sales unless there are no further purchases for a two year period.

4. Outwest Unlimited will provide Rotary Gas Systems with their call
sheets so that Rotary Gas Systems is aware of whom they are working
with. This will help eliminate the customer from trying to "go
around" Outwest Unlimited.

5. Outwest Unlimited may sell and/or rent units outside of the exclusive
area as well, and shall have the same agreement of exclusively should
a customer attempt to deal directly with Rotary Gas Systems after
having been introduced to the units by Outwest Unlimited.

6. The selling price per unit to Outwest Unlimited shall be provided by
Rotary Gas Systems and will be exclusive of sales tax,
F.O.B. -- Midland, Texas.

7. Rotary Gas Systems delivered to Outwest Unlimited on October 11, 1995
an initial unit for a period of 90 days at no charge. At the end of
the 90 day period Outwest Unlimited is to either purchase the unit for
the sum of $43,000 or return the same to the Rotary Gas Systems
Midland, Texas facility. Outwest Unlimited will be responsible in all
regards for the unit including maintenance and repairs.

8. Rotary Gas Systems warrants its units to be free from defects in
material and workmanship for a period of 90 days. All warranties by
Rotary Gas Systems are F.O.B. -- Midland, Texas. In addition Rotary
Gas Systems receives additional warranties from its suppliers (i.e.:
compressor 1 year; panel 2 years; cooler 1 year). All of these
respective warranties are F.O.B. the point of origination (i.e.:
compressor Sydney, Ohio; panel Tulsa, Oklahoma). Rotary Gas Systems
will use its best efforts to assist Outwest Unlimited in any warranty
claim. Outwest Unlimited will provide any on site service and freight
expense necessitated to fulfill warranty claims.

9. To insure warranties, all applications must be approved by Rotary Gas
Systems prior to putting the unit in service. Any change in
application after unit is in service must be approved by Rotary Gas
Systems.

10. All information obtained by either party shall be confidential
information. Outwest Unlimited or its associates will be made aware of
privileged information in regard to packaging rotary screw
compressors. Therefore Outwest Unlimited and/or its principals agree
they will not package rotary screw compressors.

11. Rotary Gas Systems shall name Outwest Unlimited as an additional
insured on their product liability insurance policy.
<PAGE>
12. A representative from Rotary Gas Systems shall be on hand for the
initial start up of any unit type not previously purchased by Outwest
Unlimited.

Agreed and accepted this 5th day of
December, 1995

/s/ KEVIN D. KING
KEVIN D. KING FOR OUTWEST UNLIMITED

/s/ WAYNE L. VINSON
WAYNE L. VINSON FOR ROTARY GAS SYSTEMS
<PAGE>
SAN JUAN COMPRESSION, INC. 1331 LAMAR, SUITE 501 HOUSTON, TEXAS 77010
================================================================================

May 29, 1996

Via Certified Mail
Return Receipt Requested

Rotary Gas Systems
2911 S. Co. Road 1260
Midland, TX 79706

Attn: Wayne L. Vinson

Gentlemen:

Please be advised that Outwest Unlimited has assigned all of its interests
under the Exclusive Sales Agreement dated December 5, 1995 between Outwest
Unlimited and Rotary Gas Systems, to San Juan Compression, L.L.C. The same
principals who owned Outwest Unlimited own San Juan Compression, L.L.C. The
transfer is being done merely for business and corporate reasons. In accordance
with Section 11 of the Exclusive Sales Agreement concerning the product
liability insurance policy of Rotary Gas Systems, please furnish us with a copy
of the certificate naming San Juan Compression, L.L.C. as an additional insured.
If you have any questions, please contact me.

Very truly yours,

By: /s/ RUSSELL D. GORDY
Name: Russell D. Gordy
Title: Chair of the Managers

- --------------------------------------------------------------------------------
SAN JUAN COMPRESSION, L.L.C.
(713) 951-0100 FAX: (713) 951-0191

EXHIBIT 10.14

EMPLOYMENT CONTRACT

THIS EMPLOYMENT CONTRACT, ("Agreement") is made and entered into as of the
1st day of December, 1997, by and between UNITED OILFIELD SERVICES, INC., a
Texas Corporation, whose address is 615 Upper North Broadway, Suite 950, MT-198,
Corpus Christi, Texas 78477, hereinafter referred to in this Agreement as the
"Employer," and ALVIN H. DUEITT, whose address is 639 County Road 48, Robstown,
Texas 78380, hereinafter referred to in this Agreement as "the Employee."

ARTICLE 1.

TERM OF EMPLOYMENT

1.01. The Employer employs the Employee, and the Employee accepts
employment with the Employer, for the three-year period from December 1, 1997,
through November 30, 2000, and thereafter until terminated by either party upon
ninety (90) days' advance written notice to the other party (herein referred to
as the "term of employment"). However, the term of employment may be terminated
earlier as provided in Article 5.

ARTICLE 2.

DUTIES OF EMPLOYEE

BASIC DUTIES

2.01. The Employee is hired as the President of the Employer. The Employee
shall perform all services, acts, or things necessary and advisable to manage
and conduct the business of the Employer, subject to the policies set by the
board of directors from time-to-time.

The Employee agrees to devote substantially all of his entire productive
time, ability and attention to the business of the Employer during the term of
employment. The services of the Employee shall be performed at such locations
and at such times as shall be directed by the board of directors from
time-to-time. The Employee shall to the best of his ability make every effort to
promote the business of the Employer and assist in the collection of all sums
due from customers of the Employer.

EMPLOYER TO PROVIDE AUTOMOBILE OR AUTOMOBILE ALLOWANCE

2.02. The Employer agrees to provide the Employee use of a properly
registered automobile selected by the Employer for all of the Employee's
transportation needs required for the performance of the Employee's duties under
this Agreement. The Employer shall also reimburse the Employee for all
reasonable and necessary gasoline, oil and automobile maintenance expenses
incurred by the Employee in the performance of his duties under this Agreement.
<PAGE>
ARTICLE 3.

COMPENSATION OF EMPLOYEE

BASIC SALARY

3.01. The Employee shall receive an annual salary of one-hundred-twenty
thousand dollars ($120,000.00) during the term of employment, payable biweekly.
If the Employee voluntarily terminates employment prior to November 30, 2000 or
is terminated pursuant to Article 5 prior to November 30, 2000, or if the
Employee's employment is terminated by either party at any time after November
30, 2000, the Employee's salary and his incentive bonus (as provided under
Section 3.02 hereof) shall be prorated and paid only to the date of termination
of employment.

INCENTIVE BONUS

3.02. The Employee shall receive an annual incentive bonus during the term
of employment equal to a percentage of the net pre-tax profits of the Employer
as shown by audited financial income statements of the Employer prepared in
accordance with generally accepted accounting procedures. Such incentive bonus
shall be determined for each annual period commencing as of December 1 and
ending as of November 30 (the "Contract Year"), with payment to the Employee to
be made on or before the ninetieth (90th) day following the end of each such
annual period. The incentive bonus shall be determined based upon the following
formula:

ANNUAL NET PRE-TAX PROFITS CUMULATIVE PERCENTAGE BONUS
- -------------------------- ---------------------------
$500,000 or less 5% of actual amount

over $500,000 plus 7-1/2% on amount over $500,000

(For example, if the Employer's net pre-tax profit for the period from December
1, 1997 through November 30, 1998 is $600,000, then the Employee shall receive
5% of $500,000 or $25,000, plus 7-1/2% of $100,000 or $7,500, for a total
incentive bonus of $32,500 for such year.)

VACATION AND SICK PAY

3.03. After the completion of six (6) months of service in the employ of
the Employer, the Employee shall be entitled to an annual paid vacation of
fifteen (15) business days with full pay. Such vacation shall be taken at any
time selected by the Employee and approved by the Employer. In addition, the
Employee shall be entitled to six (6) days per year as sick leave with pay.
Neither vacation time nor sick leave may be accumulated, and if not used during
the year in which it is granted, it shall be deemed to have been waived by the
Employee.

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<PAGE>
HOLIDAYS

3.04. The Employee shall be entitled to a holiday with full pay on New
Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day,
Christmas Day, and any other day designated by the Employer.

OTHER BENEFITS

3.05. All base compensation provided for in this Agreement shall be
exclusive of any benefits which the board of directors of the Employer may
elect, in its sole and complete discretion, after the date hereof to make
available to the Employee under any bonus plan, profit sharing trust, pension
plan, deferred compensation plan, hospitalization plan, medical or dental
service plans, health insurance plan, or any other employee benefit plan that
may be in effect at any time or from time-to-time during the term of employment
hereof. The Employer agrees that during the term of employment the Employee
shall be afforded the opportunity to participate in any such plan which is
generally available to other employees of the Employer other than any bonus plan
or other plan measured by the income or performance of the Employer.
Participating in any such plans shall be consistent with the Employee's rate of
basic compensation to the extent that compensation is a determinant with respect
to coverage or participation under any such plan; provided, however, that the
Employee's participation shall not be limited by reason of income or basic
compensation if such limitations are not necessary to obtain tax deductions or
are not required by law.

ARTICLE 4.

PROPERTY RIGHTS OF THE PARTIES

INVENTIONS AND PATENTS

4.01. The Employee agrees that he (she) will promptly and completely
inform and disclose to the Employer all inventions, designs, improvements and
discoveries that the Employee may have during the term of employment that
pertain or relate to the business of the Employer or to any experimental work
carried on by the Employer, whether conceived by the Employee alone or with
others and whether or not conceived during regular working hours. All such
inventions, designs, improvements and discoveries shall be the exclusive
property of the Employer. The Employee shall assist the Employer in obtaining
patents on all such inventions, designs, improvements and discoveries deemed
patentable by the Employer.

TRADE SECRETS OF EMPLOYER

4.02. During the term of employment under this Agreement, the Employee
will have access to and become familiar with various trade secrets. The term
"trade secrets" means devices, secret inventions, processes and compilations of
information, records and specifications, that are owned by the Employer and that
are regularly used in the operation of the business of the Employer. The
Employee shall not disclose any trade secrets of the Employer during or at any
time after the term of this Agreement, except as required in the course of his
employment
3
<PAGE>
under this Agreement. All files, records, documents, drawings, specifications,
equipment and similar items relating to the business of the Employer, whether or
not prepared by the Employee, shall remain the exclusive property of the
Employer and shall not be removed under any circumstances from the premises
where the work of the Employer is being carried on, unless prior written consent
of the Employer has been obtained.

CONFIDENTIAL DATA OF CUSTOMERS OF EMPLOYER

4.03. In the course of performing duties under this Agreement, the
Employee will be handling financial, accounting, statistical and personnel
information concerning customers of the Employer. All such information is
confidential and shall not be disclosed, directly or indirectly, to any person
other than agents of the Employer, either during the term of this Agreement or
any time after such term.

ARTICLE 5.

TERMINATION OF EMPLOYMENT

TERMINATION BY EMPLOYER FOR CAUSE

5.01. The Employer may at its option terminate this Agreement at any time
by giving written notice of termination to the Employee without prejudice to any
other remedy to which the Employer may be entitled either at law, in equity, or
under this Agreement, if the Employee:

(a) Willfully breaches or habitually neglects the duties that the
Employee is required to perform under the terms of this
Agreement;

(b) Willfully violates reasonable and substantial rules governing
employee performance;

(d) Commits clearly dishonest acts toward the Employer; or

(e) Engages in acts of disruption or violence such as unprovoked
fighting.

TERMINATION ON GROUNDS OTHER THAN FOR CAUSE

5.02. This Agreement shall terminate immediately on the occurrence of any
one of the following events:

(a) The occurrence of circumstances that make it impossible or
impracticable for the business of the Employer to be continued;

(b) The death of the Employee;

4
<PAGE>
(c) The loss by the Employee of legal capacity; or

(d) The continued incapacity on the part of the Employee to perform his
duties for a continuous period of one hundred eighty (180) days,
unless waived by the Employer.

COMPENSATION UPON TERMINATION

5.03. If the Employee is terminated by the Employer pursuant to either
Section 5.01 or 5.02 hereof, the Employer shall pay the Employee, within ten
(10) days following such termination, severance pay equal to six (6) months of
the Employee's salary, as provided under Section 3.01 hereof. If the Employee is
terminated by the Employer prior to November 30, 2000 other than pursuant to
either Section 5.01 or 5.02 hereof, the Employer shall pay the Employee, within
ten (10) days following such termination, the salary of the Employee, as
provided under Section 3.01 hereof (less all usual deductions for withholding
taxes, FICA, etc.) for the period from and after the date of termination through
November 30, 2000, and the Employee shall be entitled to no further compensation
of any nature, other than unpaid salary and incentive bonus which accrued prior
to the date of termination.

ARTICLE 6.

REIMBURSEMENT OF EXPENSES INCURRED BY EMPLOYEE

BUSINESS EXPENSES

6.01. The Employee is authorized to incur reasonable business expenses in
the performance of the Employee's duties under this Agreement and in promoting
the business of the Employer, including expenditures for entertainment and
travel. The Employer will reimburse the Employee on a monthly basis for all such
business expenses, provided that the Employee presents to the Employer:

(a) An account book or statement of expense or diary in which the
Employee recorded at or near the time each expenditure was made:

(i) The amount of the expenditure;

(ii) The time, place and type of entertainment and travel or other
expense;

(iii) The business reason for the expenditure and the nature of the
business benefit derived or expected to be derived as a result
of the expenditure;

(iv) The name and any other pertinent information concerning each
person who was entertained, sufficient to comply with Internal
Revenue Service Guidelines as revised from time-to-time;

5
<PAGE>
(b) Documentary evidence, such as receipts or paid bills, that states
sufficient information to establish the amount, date, place and
essential character of the expenditure, for each expenditure.

No expenditures will be reimbursed pursuant to this Section unless the expense
is verified and approved by the board of directors of Employer.

ARTICLE 7.

EMPLOYEE'S OBLIGATIONS OTHER THAN TO PERFORM SERVICES

NON-PIRACY AND NON-COMPETITION BY EMPLOYEE

7.01. The Employee covenants and agrees that during the term of employment
and for a period of one (1) year (provided, however, that such one (1) year
period of time may be extended to include any period of violation hereof and/or
any period of time may be extended to enforce this covenant) following any
termination of his employment with the Employer, the Employee shall not,
directly or indirectly, within the Employer's sales area, either as principal,
agent, manager, employee, owner, partner (general or limited), stockholder,
director or officer of a corporation, member of an association or otherwise,
solicit the rendering of any services of the nature performed by the Employer as
of the date of termination of Employee's employment with the Employer or sell or
offer to sell any wellhead equipment or other equipment of the nature sold by
the Employer as of the date of termination of the Employee's employment with the
Employer.

For purposes of this Article 7, the term "Conflicting Organization" shall
mean any person or organization which is engaged in or about to become engaged
in, research on or development, marketing, rendering or selling of a
"Conflicting Service" within a one hundred fifty (150) mile radius of each
location in which United has an office or place of business as of the date of
termination of this Agreement. The term "Conflicting Service" shall mean any
service or process of any person or organization other than the Employer, in
existence or under development, which is substantially similar to, resembles or
competes directly with any service, or process rendered by the Employer at the
time of the termination of the Employee's employment hereunder. The Employee
covenants and agrees that during the Employee's employment with the Employer and
for a period of one (1) year (provided, however, that such one (1) year period
may be extended to include any period of violation hereof and/or any period of
time required to enforce this covenant) following any termination of his
employment with the Employer, the Employee shall not engage in the following
activities:

(a) render services, directly or indirectly, to any Conflicting
Organization in connection with the marketing, rendering or selling
of a Conflicting Service; or

(b) render services to or own or participate in the ownership of,
finance or participate in the financing of, manage, operate, join or
control, directly or indirectly, any Conflicting Organization.

6
<PAGE>
The Employee acknowledges that this Section 7.01 constitutes an
independent covenant and shall be operative regardless of the reasons for
termination of his employment and shall not be affected by performance or
non-performance of any provision of this Agreement by the Employer.

REMEDIES

7.02. It is agreed between the parties hereto that the Employer would be
irreparably damaged by reason of any violation of the provisions of Section 7.01
hereof, and that any remedy at law for a breach of such provisions would be
inadequate. Therefore, in addition to other remedies or relief that may be
available at law to the Employer, the Employer shall be entitled to seek and
obtain injunctive or other equitable relief (including, but not limited to, a
temporary restraining order, a temporary injunction or a permanent injunction)
against Employee, his agents, assigns, or successors for a breach or threatened
breach of such provisions and without the necessity of providing actual monetary
loss. It is expressly understood between the parties that this injunctive or
other equitable relief shall not be the Employer's exclusive remedy for any
breach of this Agreement and the Employer shall be entitled to seek any other
relief or remedy which it may have by contract, statute, law or otherwise for
any breach hereof.

REASONABLENESS OF NON-PIRACY COVENANT AND COVENANT NOT TO COMPETE

7.03. The Employee warrants and represents that:

(a) he is familiar with non-piracy covenants and convents not to
compete;

(b) he has discussed the provisions of the non-piracy covenant and the
covenant not to compete contained herein with his attorney (or has
had the opportunity to discuss such covenants with his attorney and
has elected not to do so) and has concluded that such provisions
(including, without limitation, the right to equitable relief and
the length of time provided for herein) are fair, reasonable and
just under the circumstances;

(c) he is fully aware of the obligations, limitations and liabilities
included in the non-piracy covenant and the covenant not to compete
contained in this Agreement;

(d) the duration of this non-piracy covenant and covenant not to compete
has been agreed upon as a reasonable restriction, giving
consideration to the following factors: (1) The Employee and the
Employer reasonably anticipate that this Agreement, although
terminable in accordance with Article 5 hereof or otherwise, may
continue in effect for sufficient duration to allow the Employee to
attain superior bargaining strength and an ability for unfair
competition with respect to the customers covered hereby; and (2)
the duration of the non-piracy covenant and covenant not to compete
is a reasonably necessary period to allow the Employer to restore
its position of equivalent bargaining strength and fair competition
with respect to those customers covered hereby;

7
<PAGE>
(e) the failure of the non-piracy covenant to delineate a geographical
territory covered hereby does not constitute an unlimited
geographical limitation, that the non-piracy covenant imposes no
geographical restriction at all, and that the non-piracy
restrictions in the Agreement apply only to customers, and not to
territory.

It is the express intention of the Employee and the Employer to comply with the
provisions of TEX. BUS. & COMM. CODE ANN. ss.ss. 15.50 and 15.51 (Vernon 1990).

EXCLUSIONS FROM NON-COMPETITION PROVISION

7.04. The obligation of the Employee not to compete with the Employer, set
forth in Section 7.01 of this Agreement, shall not prohibit the Employee from
being a member of professional or social organizations or from owning or
purchasing any corporate securities of a Conflicting Organization that are
regularly traded on a recognized stock exchange or over-the-counter market,
provided that the Employee's ownership interest therein does not exceed one
percent (1%) of all issued and outstanding shares of any class of corporate
security thereof.

INDEMNIFICATION

7.05. The Employee shall indemnify and hold harmless Employer from all
liability from loss, damage, or injury to persons or property resulting from the
willful misconduct of the Employee committed in the scope of the Employee's
employment.

ARTICLE 8.

GENERAL PROVISIONS

NOTICES

8.01. Any notices required to be given under this Agreement by either
party to the other may be effected either by personal delivery in writing or by
mail, registered or certified, postage prepaid with return receipt requested.
Mailed notices shall be addressed to the parties at the addresses appearing in
the introductory paragraph of this Agreement. Each party may change that party's
address by written notice in accordance with this paragraph. Notices delivered
personally shall be deemed effective as of actual receipt. Mailed notices shall
be deemed effective as of two (2) days after posting with the United States Mail
Service.

ENTIRETY OF AGREEMENT

8.02. This Agreement supersedes all previous agreements between the
Employee and the Employer, and contains the entire understanding between the
parties with respect to the subject matter specified in this Agreement. Each
party to this Agreement acknowledges that no other agreement, statement, or
promise not contained in this Agreement shall be valid or binding. Any
modification of this Agreement will be effective only if it is in writing signed
by the party to be charged.

8
<PAGE>
PARTIAL INVALIDITY

8.03. If any provision in this Agreement is held by a court of competent
jurisdiction to be invalid, void, or unenforceable, the remaining provisions
shall nevertheless continue in full force without being impaired or invalidated
in any way.

LAW GOVERNING AGREEMENT

8.04. It is the intent of the parties that this Agreement be governed by
and construed in accordance with the laws of the State of Texas.

WAIVER

8.05. The failure of either the Employer or the Employee to insist in one
or more instances upon performance of any of the terms or conditions of this
Agreement shall not be construed as a waiver of future performance required by
such term or condition, and the obligations of either party with respect to the
term or condition shall continue in effect as if no forbearance had occurred. No
covenant or condition of this Agreement may be waived except by the written
consent of the waiving party.

CAPTIONS

8.06. The captions contained in this Agreement are for convenient
reference only and do not affect the meaning of any term or provision.

BINDING EFFECT

8.07. This Agreement shall be binding upon the parties hereto and upon
their successors, heirs, executors and assigns.

TERMINATION OF EXISTING EMPLOYMENT AGREEMENT

8.08. The Employer and the Employee acknowledge that this Agreement shall
supersede and replace in its entirety that certain Employment Agreement dated
May 31, 1994, by and between the Employer and the Employee (the "Original
Agreement"). Upon the execution and delivery of this Agreement, the Original
Agreement shall be deemed to have terminated and shall thereafter have no
further force or effect.

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<PAGE>
EXECUTED in multiple originals as of the date first written above.

EMPLOYER:

UNITED OILFIELD SERVICES, INC.

By:/s/WALLACE SELLERS
Wallace Sellers,
Chairman of the Board

EMPLOYEE:

/s/ ALVIN H. DUEITT
ALVIN H. DUEITT

EXHIBIT 10.15

EMPLOYMENT CONTRACT

THIS EMPLOYMENT CONTRACT, ("Agreement") is made and entered into as of the
1st day of December, 1997, by and between UNITED OILFIELD SERVICES, INC., a
Texas Corporation, whose address is 615 Upper North Broadway, Suite 950, MT-198,
Corpus Christi, Texas 78477, hereinafter referred to in this Agreement as the
"Employer," and BURNACE J. BOLES, JR., whose address is c/o Flare King, Inc.,
2911 S. CR 1260, Midland, Texas 79706 hereinafter referred to in this Agreement
as "the Employee."

ARTICLE 1.

TERM OF EMPLOYMENT

ARTICLE 2.

DUTIES OF EMPLOYEE

BASIC DUTIES

2.01. The Employee is hired as the President of Flare King, Inc., a wholly
owned subsidiary of Employer. The Employee shall perform all services, acts, or
things necessary and advisable to manage and conduct the business of the
Employer, subject to the policies set by the board of directors from
time-to-time.

EMPLOYER TO PROVIDE AUTOMOBILE OR AUTOMOBILE ALLOWANCE

COMPENSATION OF EMPLOYEE

BASIC SALARY

3.01. The Employee shall receive an annual salary of sixty thousand
dollars ($60,000.00) during the term of employment, payable biweekly. If the
Employee voluntarily terminates employment prior to November 30, 2000 or is
terminated pursuant to Article 5 prior to November 30, 2000, or if the
Employee's employment is terminated by either party at any time after November
30, 2000, the Employee's salary and his incentive bonus (as provided under
Section 3.02 hereof) shall be prorated and paid only to the date of termination
of employment.

INCENTIVE BONUS

3.02. The Employee shall receive an annual incentive bonus during the term
of employment equal to a percentage of the net pre-tax profits of Flare King,
Inc. and Hi-Tech Compressor Company, L.C. as shown by audited financial income
statements of such companies prepared in accordance with generally accepted
accounting procedures. Such incentive bonus shall be determined for each annual
period commencing as of December 1 and ending as of November 30 (the "Contract
Year"), with payment to the Employee to be made on or before the ninetieth
(90th) day following the end of each such annual period. The incentive bonus
shall be equal to 10% of the pre-tax profits of Flare King, Inc., plus 5% of the
pre-tax profits of Hi-Tech; provided, however, that the total incentive bonus
shall not exceed 200% of the Employee's base annual salary.

VACATION AND SICK PAY

HOLIDAYS

OTHER BENEFITS

2
<PAGE>
sharing trust, pension plan, deferred compensation plan, hospitalization plan,
medical or dental service plans, health insurance plan, or any other employee
benefit plan that may be in effect at any time or from time-to-time during the
term of employment hereof. The Employer agrees that during the term of
employment the Employee shall be afforded the opportunity to participate in any
such plan which is generally available to other employees of the Employer other
than any bonus plan or other plan measured by the income or performance of the
Employer. Participating in any such plans shall be consistent with the
Employee's rate of basic compensation to the extent that compensation is a
determinant with respect to coverage or participation under any such plan;
provided, however, that the Employee's participation shall not be limited by
reason of income or basic compensation if such limitations are not necessary to
obtain tax deductions or are not required by law.

ARTICLE 4.

PROPERTY RIGHTS OF THE PARTIES

INVENTIONS AND PATENTS

TRADE SECRETS OF EMPLOYER

4.02. During the term of employment under this Agreement, the Employee
will have access to and become familiar with various trade secrets. The term
"trade secrets" means devices, secret inventions, processes and compilations of
information, records and specifications, that are owned by the Employer and that
are regularly used in the operation of the business of the Employer. The
Employee shall not disclose any trade secrets of the Employer during or at any
time after the term of this Agreement, except as required in the course of his
employment under this Agreement. All files, records, documents, drawings,
specifications, equipment and similar items relating to the business of the
Employer, whether or not prepared by the Employee, shall remain the exclusive
property of the Employer and shall not be removed under any circumstances from
the premises where the work of the Employer is being carried on, unless prior
written consent of the Employer has been obtained.

CONFIDENTIAL DATA OF CUSTOMERS OF EMPLOYER

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<PAGE>
to any person other than agents of the Employer, either during the term of this
Agreement or any time after such term.

ARTICLE 5.

TERMINATION OF EMPLOYMENT

TERMINATION BY EMPLOYER FOR CAUSE

(a) Willfully breaches or habitually neglects the duties that the
Employee is required to perform under the terms of this Agreement;

(b) Willfully violates reasonable and substantial rules governing
employee performance;

(d) Commits clearly dishonest acts toward the Employer; or

(e) Engages in acts of disruption or violence such as unprovoked
fighting.

TERMINATION ON GROUNDS OTHER THAN FOR CAUSE

5.02. This Agreement shall terminate immediately on the occurrence of any
one of the following events:

(a) The occurrence of circumstances that make it impossible or
impracticable for the business of the Employer to be continued;

(b) The death of the Employee;

(d) The continued incapacity on the part of the Employee to perform his
duties for a continuous period of one hundred eighty (180) days,
unless waived by the Employer.

COMPENSATION UPON TERMINATION

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<PAGE>
Section 3.01 hereof. If the Employee is terminated by the Employer prior to
November 30, 2000 other than pursuant to either Section 5.01 or 5.02 hereof, the
Employer shall pay the Employee, within ten (10) days following such
termination, the salary of the Employee, as provided under Section 3.01 hereof
(less all usual deductions for withholding taxes, FICA, etc.) for the period
from and after the date of termination through November 30, 2000, and the
Employee shall be entitled to no further compensation of any nature, other than
unpaid salary and incentive bonus which accrued prior to the date of
termination.

ARTICLE 6.

REIMBURSEMENT OF EXPENSES INCURRED BY EMPLOYEE

BUSINESS EXPENSES

(a) An account book or statement of expense or diary in which the
Employee recorded at or near the time each expenditure was made:

(i) The amount of the expenditure;

(ii) The time, place and type of entertainment and travel or other
expense;

(iii) The business reason for the expenditure and the nature of the
business benefit derived or expected to be derived as a result
of the expenditure;

(iv) The name and any other pertinent information concerning each
person who was entertained, sufficient to comply with Internal
Revenue Service Guidelines as revised from time-to-time;

(b) Documentary evidence, such as receipts or paid bills, that states
sufficient information to establish the amount, date, place and
essential character of the expenditure, for each expenditure.

No expenditures will be reimbursed pursuant to this Section unless the expense
is verified and approved by the board of directors of Employer.

ARTICLE 7.

EMPLOYEE'S OBLIGATIONS OTHER THAN TO PERFORM SERVICES

NON-PIRACY AND NON-COMPETITION BY EMPLOYEE

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<PAGE>
7.01. The Employee covenants and agrees that during the term of employment
and for a period of one (1) year (provided, however, that such one (1) year
period of time may be extended to include any period of violation hereof and/or
any period of time may be extended to enforce this covenant) following any
termination of his employment with the Employer, the Employee shall not,
directly or indirectly, within the Employer's sales area, either as principal,
agent, manager, employee, owner, partner (general or limited), stockholder,
director or officer of a corporation, member of an association or otherwise,
solicit the rendering of any services of the nature performed by the Employer as
of the date of termination of Employee's employment with the Employer or sell or
offer to sell any wellhead equipment or other equipment of the nature sold by
the Employer as of the date of termination of the Employee's employment with the
Employer.

(a) render services, directly or indirectly, to any Conflicting
Organization in connection with the marketing, rendering or selling
of a Conflicting Service; or

(b) render services to or own or participate in the ownership of,
finance or participate in the financing of, manage, operate, join or
control, directly or indirectly, any Conflicting Organization.

REMEDIES

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assigns, or successors for a breach or threatened breach of such provisions and
without the necessity of providing actual monetary loss. It is expressly
understood between the parties that this injunctive or other equitable relief
shall not be the Employer's exclusive remedy for any breach of this Agreement
and the Employer shall be entitled to seek any other relief or remedy which it
may have by contract, statute, law or otherwise for any breach hereof.

REASONABLENESS OF NON-PIRACY COVENANT AND COVENANT NOT TO COMPETE

7.03. The Employee warrants and represents that:

(a) he is familiar with non-piracy covenants and convents not to
compete;

(c) he is fully aware of the obligations, limitations and liabilities
included in the non-piracy covenant and the covenant not to compete
contained in this Agreement;

(e) the failure of the non-piracy covenant to delineate a geographical
territory covered hereby does not constitute an unlimited
geographical limitation, that the non-piracy covenant imposes no
geographical restriction at all, and that the non-piracy
restrictions in the Agreement apply only to customers, and not to
territory.

It is the express intention of the Employee and the Employer to comply with the
provisions of TEX. BUS. & COMM. CODE ANN. ss.ss. 15.50 and 15.51 (Vernon 1990).

EXCLUSIONS FROM NON-COMPETITION PROVISION

7.04. The obligation of the Employee not to compete with the Employer, set
forth in Section 7.01 of this Agreement, shall not prohibit the Employee from
being a member of

7
<PAGE>
professional or social organizations or from owning or purchasing any corporate
securities of a Conflicting Organization that are regularly traded on a
recognized stock exchange or over-the-counter market, provided that the
Employee's ownership interest therein does not exceed one percent (1%) of all
issued and outstanding shares of any class of corporate security thereof.

INDEMNIFICATION

ARTICLE 8.

GENERAL PROVISIONS

NOTICES

ENTIRETY OF AGREEMENT

PARTIAL INVALIDITY

LAW GOVERNING AGREEMENT

8.04. It is the intent of the parties that this Agreement be governed by
and construed in accordance with the laws of the State of Texas.

WAIVER

8
<PAGE>
8.05. The failure of either the Employer or the Employee to insist in one
or more instances upon performance of any of the terms or conditions of this
Agreement shall not be construed as a waiver of future performance required by
such term or condition, and the obligations of either party with respect to the
term or condition shall continue in effect as if no forbearance had occurred. No
covenant or condition of this Agreement may be waived except by the written
consent of the waiving party.

CAPTIONS

8.06. The captions contained in this Agreement are for convenient
reference only and do not affect the meaning of any term or provision.

BINDING EFFECT

8.07. This Agreement shall be binding upon the parties hereto and upon
their successors, heirs, executors and assigns.

TERMINATION OF EXISTING EMPLOYMENT AGREEMENT

8.08. The Employer and the Employee acknowledge that this Agreement shall
supersede and replace in its entirety that certain Employment Agreement dated
January 14, 1997, by and between the Employer and the Employee (the "Original
Agreement"). Upon the execution and delivery of this Agreement, the Original
Agreement shall be deemed to have terminated and shall thereafter have no
further force or effect.

9
<PAGE>
EXECUTED in multiple originals as of the date first written above.

EMPLOYER:

UNITED OILFIELD SERVICES, INC.

By:/s/ALVIN H. DUEITT
Alvin H. Dueitt,
President

EMPLOYEE:

/s/BURNACE J. BOLES, JR.
BURNACE J. BOLES, JR.

EXHIBIT 10.16

EMPLOYMENT CONTRACT

THIS EMPLOYMENT CONTRACT, ("Agreement") is made and entered into as of the
1st day of December, 1997, by and between UNITED OILFIELD SERVICES, INC., a
Texas Corporation, whose address is 615 Upper North Broadway, Suite 950, MT-198,
Corpus Christi, Texas 78477, hereinafter referred to in this Agreement as the
"Employer," and MARTIN TOMLIN, whose address is 639 County Road 48, Robstown,
Texas 78380, hereinafter referred to in this Agreement as "the Employee".

ARTICLE 1.

TERM OF EMPLOYMENT

1.01. The Employer employs the Employee, and the Employee accepts
employment with the Employer, for the three-year period from December 1, 1997,
through November 30, 2000, and thereafter until terminated by either party upon
ninety (90) days advance written notice to the other party (herein referred to
as the "term of employment"). However, the term of employment may be terminated
earlier as provided in Article 5.

ARTICLE 2.

DUTIES OF EMPLOYEE

BASIC DUTIES

2.01. The Employee is hired as a Vice President of United Wellhead
Services, Inc. ("Wellhead"), a wholly owned subsidiary of Employer. The Employee
shall perform all services, acts, or things necessary and advisable to manage
and conduct the business of Wellhead, subject to the policies set by the board
of directors from time-to-time.

The Employee agrees to devote substantially all of his entire productive
time, ability and attention to the business of Wellhead and the Employer during
the term of employment. The services of the Employee shall be performed at such
locations and at such times as shall be directed by the board of directors from
time-to-time. The Employee shall to the best of his ability make every effort to
promote the business of Wellhead and the Employer and assist in the collection
of all sums due from customers of the Employer.

EMPLOYER TO PROVIDE AUTOMOBILE OR AUTOMOBILE ALLOWANCE

COMPENSATION OF EMPLOYEE

BASIC SALARY

3.01. The Employee shall receive an annual salary of seventy-seven
thousand dollars ($77,000.00) during the term of employment, payable biweekly.
If the Employee voluntarily terminates employment prior to November 30, 2000 or
is terminated pursuant to Article 5 prior to November 30, 2000, or if the
Employee's employment is terminated by either party at any time after November
30, 2000, the Employee's salary and his incentive bonus (as provided under
Section 3.02 hereof) shall be prorated and paid only to the date of termination
of employment.

INCENTIVE BONUS

3.02. The Employee shall receive an annual incentive bonus during the term
of employment equal to a percentage of the net pre-tax profits of the Corpus
Christi branch of the Employer as shown by audited financial income statements
of the Employer prepared in accordance with generally accepted accounting
procedures. Such incentive bonus shall be determined for each annual period
commencing as of December 1 and ending as of November 30 (the "Contract Year"),
with payment to the Employee to be made on or before the ninetieth (90th) day
following the end of each such annual period. The incentive bonus shall be
determined based upon the following formula:

ANNUAL NET PRE-TAX PROFITS CUMULATIVE PERCENTAGE BONUS

$500,000 or less 5% of actual amount

over $500,000 plus 7-1/2% on amount over $500,000

VACATION AND SICK PAY

HOLIDAYS

2
<PAGE>
OTHER BENEFITS

ARTICLE 4.

PROPERTY RIGHTS OF THE PARTIES

INVENTIONS AND PATENTS

TRADE SECRETS OF EMPLOYER

4.02. During the term of employment under this Agreement, the Employee
will have access to and become familiar with various trade secrets. The term
"trade secrets" means devices, secret inventions, processes and compilations of
information, records and specifications, that are owned by the Employer and that
are regularly used in the operation of the business of the Employer. The
Employee shall not disclose any trade secrets of the Employer during or at any
time after the term of this Agreement, except as required in the course of his
employment under this Agreement. All files, records, documents, drawings,
specifications, equipment and similar items relating to the business of the
Employer, whether or not prepared by the Employee, shall remain the exclusive
property of the Employer and shall not be removed under any circumstances from
the premises where the work of the Employer is being carried on, unless prior
written consent of the Employer has been obtained.

3
<PAGE>
CONFIDENTIAL DATA OF CUSTOMERS OF EMPLOYER

ARTICLE 5.

TERMINATION OF EMPLOYMENT

TERMINATION BY EMPLOYER FOR CAUSE

(a) Willfully breaches or habitually neglects the duties that the
Employee is required to perform under the terms of this Agreement;

(b) Willfully violates reasonable and substantial rules governing
employee performance;

(d) Commits clearly dishonest acts toward the Employer; or

(e) Engages in acts of disruption or violence such as unprovoked
fighting.

TERMINATION ON GROUNDS OTHER THAN FOR CAUSE

5.02. This Agreement shall terminate immediately on the occurrence of any
one of the following events:

(a) The occurrence of circumstances that make it impossible or
impracticable for the business of the Employer to be continued;

(b) The death of the Employee;

(d) The continued incapacity on the part of the Employee to perform his
duties for a continuous period of one hundred eighty (180) days,
unless waived by the Employer.

4
<PAGE>
COMPENSATION UPON TERMINATION

5.03. If the Employee is terminated by the Employer pursuant to either
Section 5.01 or 5.02 hereof, the Employer shall pay the Employee, within ten
(10) days following such termination, severance pay equal to three (3) months of
the Employee's salary, as provided under Section 3.01 hereof. If the Employee is
terminated by the Employer prior to November 30, 2000 other than pursuant to
either Section 5.01 or 5.02 hereof, the Employer shall pay the Employee, within
ten (10) days following such termination, the salary of the Employee, as
provided under Section 3.01 hereof (less all usual deductions for withholding
taxes, FICA, etc.) for the period from and after the date of termination through
November 30, 2000, and the Employee shall be entitled to no further compensation
of any nature, other than unpaid salary and incentive bonus which accrued prior
to the date of termination.

ARTICLE 6.

REIMBURSEMENT OF EXPENSES INCURRED BY EMPLOYEE

BUSINESS EXPENSES

(a) An account book or statement of expense or diary in which the
Employee recorded at or near the time each expenditure was made:

(i) The amount of the expenditure;

(ii) The time, place and type of entertainment and travel or other
expense;

(iii) The business reason for the expenditure and the nature of the
business benefit derived or expected to be derived as a result
of the expenditure;

(iv) The name and any other pertinent information concerning each
person who was entertained, sufficient to comply with Internal
Revenue Service Guidelines as revised from time-to-time;

(b) Documentary evidence, such as receipts or paid bills, that states
sufficient information to establish the amount, date, place and
essential character of the expenditure, for each expenditure.

No expenditures will be reimbursed pursuant to this Section unless the expense
is verified and approved by the board of directors of Employer.

5
<PAGE>
ARTICLE 7.

EMPLOYEE'S OBLIGATIONS OTHER THAN TO PERFORM SERVICES

NON-PIRACY AND NON-COMPETITION BY EMPLOYEE

(a) render services, directly or indirectly, to any Conflicting
Organization in connection with the marketing, rendering or selling
of a Conflicting Service; or

(b) render services to or own or participate in the ownership of,
finance or participate in the financing of, manage, operate, join or
control, directly or indirectly, any Conflicting Organization.

6
<PAGE>
REMEDIES

REASONABLENESS OF NON-PIRACY COVENANT AND COVENANT NOT TO COMPETE

7.03. The Employee warrants and represents that:

(a) he is familiar with non-piracy covenants and convents not to
compete;

(c) he is fully aware of the obligations, limitations and liabilities
included in the non-piracy covenant and the covenant not to compete
contained in this Agreement;

7
<PAGE>
It is the express intention of the Employee and the Employer to comply with the
provisions of TEX. BUS. & COMM. CODE ANN. ss.ss. 15.50 and 15.51 (Vernon 1990).

EXCLUSIONS FROM NON-COMPETITION PROVISION

INDEMNIFICATION

ARTICLE 8.

GENERAL PROVISIONS

NOTICES

ENTIRETY OF AGREEMENT

PARTIAL INVALIDITY

8
<PAGE>
LAW GOVERNING AGREEMENT

8.04. It is the intent of the parties that this Agreement be governed by
and construed in accordance with the laws of the State of Texas.

WAIVER

CAPTIONS

8.06. The captions contained in this Agreement are for convenient
reference only and do not affect the meaning of any term or provision.

BINDING EFFECT

8.07. This Agreement shall be binding upon the parties hereto and upon
their successors, heirs, executors and assigns.

TERMINATION OF EXISTING EMPLOYMENT AGREEMENT

9
<PAGE>
EXECUTED in multiple originals as of the date first written above.

EMPLOYER:

UNITED OILFIELD SERVICES, INC.

By:/s/ALVIN DUEITT
Alvin Dueitt,
President

EMPLOYEE:

/s/MARTIN TOMLIN
MARTIN TOMLIN

EXHIBIT 10.17

EMPLOYMENT CONTRACT

THIS EMPLOYMENT CONTRACT, ("Agreement") is made and entered into as of the
1st day of December, 1997, by and between UNITED OILFIELD SERVICES, INC., a
Texas Corporation, whose address is 615 Upper North Broadway, Suite 950, MT-198,
Corpus Christi, Texas 78477, hereinafter referred to in this Agreement as the
"Employer," and J. RICHARD ESPINOSA, whose address is 8730 Ley Road, Houston,
Texas 77028-2901, hereinafter referred to in this Agreement as "the Employee".

ARTICLE 1.

TERM OF EMPLOYMENT

1.01. The Employer employs the Employee, and the Employee accepts
employment with the Employer, for the three-year period from December 1, 1997,
through November 30, 2000, and thereafter until terminated by either party upon
ninety (90) days advance written notice to the other party (herein referred to
as the "term of employment"). However, the term of employment may be terminated
earlier as provided in Article 5.

ARTICLE 2.

DUTIES OF EMPLOYEE

BASIC DUTIES

EMPLOYER TO PROVIDE AUTOMOBILE OR AUTOMOBILE ALLOWANCE

COMPENSATION OF EMPLOYEE

BASIC SALARY

3.01. The Employee shall receive an annual salary of seventy thousand
dollars ($70,000.00) during the term of employment, payable biweekly. If the
Employee voluntarily terminates employment prior to November 30, 2000 or is
terminated pursuant to Article 5 prior to November 30, 2000, or if the
Employee's employment is terminated by either party at any time after November
30, 2000, the Employee's salary and his incentive bonus (as provided under
Section 3.02 hereof) shall be prorated and paid only to the date of termination
of employment.

INCENTIVE BONUS

ANNUAL NET PRE-TAX PROFITS CUMULATIVE PERCENTAGE BONUS

$500,000 or less 2%

between $500,000 and $600,001 5%

between $600,000 and $700,001 6%

between $700,000 and $800,001 7%

over $800,000 8%

(For example, if the Employer's net pre-tax profit for the period from December
1, 1997 through November 30, 1998 is $600,000, then the Employee shall receive
2% of $500,000 or $10,000, plus 5% of $100,000 or $5,000, for a total incentive
bonus of $15,000 for such year.)

VACATION AND SICK PAY

2
<PAGE>
pay. Neither vacation time nor sick leave may be accumulated, and if not used
during the year in which it is granted, it shall be deemed to have been waived
by the Employee.

HOLIDAYS

OTHER BENEFITS

ARTICLE 4.

PROPERTY RIGHTS OF THE PARTIES

INVENTIONS AND PATENTS

TRADE SECRETS OF EMPLOYER

3
<PAGE>
that are owned by the Employer and that are regularly used in the operation of
the business of the Employer. The Employee shall not disclose any trade secrets
of the Employer during or at any time after the term of this Agreement, except
as required in the course of his employment under this Agreement. All files,
records, documents, drawings, specifications, equipment and similar items
relating to the business of the Employer, whether or not prepared by the
Employee, shall remain the exclusive property of the Employer and shall not be
removed under any circumstances from the premises where the work of the Employer
is being carried on, unless prior written consent of the Employer has been
obtained.

CONFIDENTIAL DATA OF CUSTOMERS OF EMPLOYER

ARTICLE 5.

TERMINATION OF EMPLOYMENT

TERMINATION BY EMPLOYER FOR CAUSE

5.01. The Employer may at its option terminate this Agreement under this
Section 5.01 at any time by giving two (2) weeks advance written notice of
termination to the Employee without prejudice to any other remedy to which the
Employer may be entitled either at law, in equity, or under this Agreement, if
the Employee:

(a) Willfully breaches or habitually neglects the duties that the
Employee is required to perform under the terms of this Agreement;

(b) Willfully violates reasonable and substantial rules governing
employee performance;

(d) Commits clearly dishonest acts toward the Employer; or

(e) Engages in acts of disruption or violence such as unprovoked
fighting.

TERMINATION ON GROUNDS OTHER THAN FOR CAUSE

5.02. This Agreement shall terminate immediately on the occurrence of any
one of the following events:

4
<PAGE>
(a) The occurrence of circumstances that make it impossible or
impracticable for the business of the Employer to be continued;

(b) The death of the Employee;

(d) The continued incapacity on the part of the Employee to perform his
duties for a continuous period of one hundred eighty (180) days,
unless waived by the Employer.

COMPENSATION UPON TERMINATION

5.03. If the Employee is terminated by the Employer pursuant to either
Section 5.01 or 5.02 hereof, the Employer shall pay the Employee, within ten
(10) days following such termination, severance pay equal to three (3) months of
the Employee's salary, as provided under Section 3.01 hereof. If the Employee is
terminated by the Employer prior to November 30, 2000 other than pursuant to
either Section 5.01 or 5.02 hereof, the Employer shall pay the Employee, within
ten (10) days following such termination, the salary of the Employee, as
provided under Section 3.01 hereof (less all usual deductions for withholding
taxes, FICA, etc.) for the period from and after the date of termination through
November 30, 2000, and the Employee shall be entitled to no further compensation
of any nature, other than unpaid salary and incentive bonus which accrued prior
to the date of termination.

ARTICLE 6.

REIMBURSEMENT OF EXPENSES INCURRED BY EMPLOYEE

BUSINESS EXPENSES

(a) An account book or statement of expense or diary in which the
Employee recorded at or near the time each expenditure was made:

(i) The amount of the expenditure;

(ii) The time, place and type of entertainment and travel or other
expense;

(iii) The business reason for the expenditure and the nature of the
business benefit derived or expected to be derived as a result
of the expenditure;

5
<PAGE>
(iv) The name and any other pertinent information concerning each
person who was entertained, sufficient to comply with Internal
Revenue Service Guidelines as revised from time-to-time;

(b) Documentary evidence, such as receipts or paid bills, that states
sufficient information to establish the amount, date, place and
essential character of the expenditure, for each expenditure.

No expenditures will be reimbursed pursuant to this Section unless the expense
is verified and approved by the board of directors of Employer.

ARTICLE 7.

EMPLOYEE'S OBLIGATIONS OTHER THAN TO PERFORM SERVICES

NON-PIRACY AND NON-COMPETITION BY EMPLOYEE

(a) render services, directly or indirectly, to any Conflicting
Organization in connection with the marketing, rendering or selling
of a Conflicting Service; or

6
<PAGE>
(b) render services to or own or participate in the ownership of,
finance or participate in the financing of, manage, operate, join or
control, directly or indirectly, any Conflicting Organization.

The Employee acknowledges that this Section 7.01 constitutes an
independent covenant and shall be operative regardless of the reasons for
termination of his employment and shall not be affected by performance or
non-performance of any provision of this Agreement by the Employer; provided,
however, that if Employer terminates this Agreement for any reason other than
for cause (as defined in Section 5.01 hereof), the noncompetition and nonpiracy
covenants of this Agreement shall then prospectively terminate upon Employer's
termination of this Agreement.

REMEDIES

REASONABLENESS OF NON-PIRACY COVENANT AND COVENANT NOT TO COMPETE

7.03. The Employee warrants and represents that:

(a) he is familiar with non-piracy covenants and convents not to
compete;

(c) he is fully aware of the obligations, limitations and liabilities
included in the non-piracy covenant and the covenant not to compete
contained in this Agreement;

7
<PAGE>
may continue in effect for sufficient duration to allow the Employee
to attain superior bargaining strength and an ability for unfair
competition with respect to the customers covered hereby; and (2)
the duration of the non-piracy covenant and covenant not to compete
is a reasonably necessary period to allow the Employer to restore
its position of equivalent bargaining strength and fair competition
with respect to those customers covered hereby;

It is the express intention of the Employee and the Employer to comply with the
provisions of TEX. BUS. & COMM. CODE ANN. ss.ss. 15.50 and 15.51 (Vernon 1990).

EXCLUSIONS FROM NON-COMPETITION PROVISION

INDEMNIFICATION

ARTICLE 8.

GENERAL PROVISIONS

NOTICES

8
<PAGE>
ENTIRETY OF AGREEMENT

PARTIAL INVALIDITY

LAW GOVERNING AGREEMENT

8.04. It is the intent of the parties that this Agreement be governed by
and construed in accordance with the laws of the State of Texas.

WAIVER

CAPTIONS

8.06. The captions contained in this Agreement are for convenient
reference only and do not affect the meaning of any term or provision.

BINDING EFFECT

8.07. This Agreement shall be binding upon the parties hereto and upon
their successors, heirs, executors and assigns.

TERMINATION OF EXISTING EMPLOYMENT AGREEMENT

8.08. The Employer and the Employee acknowledge that this Agreement shall
supersede and replace in its entirety that certain Employment Agreement dated
June 6, 1994, by and between the Employer and the Employee (the "Original
Agreement"). Upon the execution and delivery of this Agreement, the Original
Agreement shall be deemed to have terminated and shall thereafter have no
further force or effect.

9
<PAGE>
EXECUTED in multiple originals as of the date first written above.

EMPLOYER:

UNITED OILFIELD SERVICES, INC.

By:/s/ALVIN H. DUEITT
Alvin H. Dueitt,
President

EMPLOYEE:

/s/J. RICHARD ESPINOSA
J. RICHARD ESPINOSA

EXHIBIT 10.12

EXCLUSIVE SALES AGREEMENT

2. This area shall remain exclusive as long as Outwest Unlimited
purchases from and/or sells a minimum of 12 Rotary Gas System units
the first year and shall have sold a minimum of 72 units by the end of
second year. This two year period shall start January 11, 1996.

6. The selling price per unit to Outwest Unlimited shall be provided by
Rotary Gas Systems and will be exclusive of sales tax,
F.O.B. -- Midland, Texas.

Agreed and accepted this 5th day of
December, 1995

/s/ KEVIN D. KING
KEVIN D. KING FOR OUTWEST UNLIMITED

May 29, 1996

Via Certified Mail
Return Receipt Requested

Rotary Gas Systems
2911 S. Co. Road 1260
Midland, TX 79706

Attn: Wayne L. Vinson

Gentlemen:

Very truly yours,

By: /s/ RUSSELL D. GORDY
Name: Russell D. Gordy
Title: Chair of the Managers

- --------------------------------------------------------------------------------
SAN JUAN COMPRESSION, L.L.C.
(713) 951-0100 FAX: (713) 951-0191

EXHIBIT 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

[LETTERHEAD OF KARLINS FULLER ARNOLD & KLODOSKY, P.C.]

We consent to the inclusion in this registration statement on Form S-1 of our
report dated March 3, 1997, on our audits of the financial statements of United
Wellhead Services, Inc., Flare King, Inc., and Hi-Tech Compressor Company, L.C.,
except for Note L on United Wellhead Services, Inc., Note J on Flare King, Inc.
and Note H on Hi-Tech Compressor Company, L.C., as to which to the dates are
April 11, 1997 and December 23, 1997. We consent to inclusion in this
registration statement of Form S-1 of our report dated December 23, 1997 on our
audit of the balance sheet of United Oilfield Services, Inc. We also consent to
the reference to our firm under the caption "Experts."

/s/ KARLINS FULLER ARNOLD & KLODOSKY, P.C.
KARLINS FULLER ARNOLD & KLODOSKY, P.C.

The Woodlands, Texas
January 7, 1998

<ARTICLE> 5
<LEGEND>
THE AMENDED FINANCIAL DATA SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM UNITED WELLHEAD SERVICES, INC. AS THE ACCOUNTING ACQUIROR AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 369
<SECURITIES> 0
<RECEIVABLES> 2099
<ALLOWANCES> (10)
<INVENTORY> 739
<CURRENT-ASSETS> 3,269
<PP&E> 1,387
<DEPRECIATION> (973)
<TOTAL-ASSETS> 3,898
<CURRENT-LIABILITIES> (2,025)
<BONDS> 0
0
(960)
<COMMON> (479)
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> (1,563)
<SALES> (8,011)
<TOTAL-REVENUES> (8,011)
<CGS> 5,160
<TOTAL-COSTS> 2,198
<OTHER-EXPENSES> 54
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 36
<INCOME-PRETAX> (563)
<INCOME-TAX> 257
<INCOME-CONTINUING> (306)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (306)
<EPS-PRIMARY> .09
<EPS-DILUTED> .09

</TABLE>