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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
SCHEDULE 13D
(RULE 13D-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13D-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13D-2(a)
DAWSON PRODUCTION SERVICES, INC.
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(Name of Issuer)
Common Stock, Par Value $.01 Per Share
-------------------------------------
Title of Class of Securities
239423106
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(CUSIP Number)
Jack D. Loftis, Jr.
Key Energy Group, Inc.,
Two Tower Center, Twentieth Floor
East Brunswick, NJ 08816
(732) 247-4822
-------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
June 3, 1998
---------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check
the following box [_].
Note: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7(b) for
other parties to whom copies are to be sent.
The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 (the "Act") or otherwise subject to the liabilities
of that section of the Act but shall be subject to all other provisions
of the Act (however, see the Notes).
(Continued on following pages)
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(Page 1 of 10 Pages)
Exhibit Index: Page 10
CUSIP NO. 239423106 13D PAGE 2 OF 10 PAGES
1 Name of Reporting Person
I.R.S. Identification No. of Above Person (ENTITIES ONLY)
Key Energy Group, Inc. (I.R.S. Identification No.: 04-2648081)
2 Check the Appropriate Box If a Member of a Group
a. [ ]
b. [ ]
3 SEC Use Only
4 Source of Funds
WC
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) [ ]
6 Citizenship or Place of Organization
Maryland
7 Sole Voting Power
Number of 820,500
Shares
Beneficially 8 Shared Voting Power
Owned By 0
Each
Reporting 9 Sole Dispositive Power
Person 820,500
With
10 Shared Dispositive Power
0
11 Aggregate Amount Beneficially Owned by Each Reporting Person
820,500
12 Check Box If the Aggregate Amount in Row (11) Excludes
Certain Shares [ ]
13 Percent of Class Represented By Amount in Row (11)
7.4%
14 Type of Reporting Person
CO
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PAGE 3 OF 10 PAGES
ITEM 1. SECURITY AND ISSUER.
This statement (this "Statement") relates to shares of Common Stock,
par value $.01 per share (the "Shares"), of Dawson Production Services,
Inc. (the "Issuer"). The address of the principal executive offices of the
Issuer is 112 E. Pecan Street, Suite 1000, San Antonio, Texas 78205.
ITEM 2. IDENTITY AND BACKGROUND.
This Statement is being filed on behalf of Key Energy Group, Inc. (the
"Reporting Person"). The Reporting Person is a Maryland corporation
engaged in the business of oil and gas well maintenance, including workover
and completion services, contract drilling, oil field fluid transportation,
storage and disposal services, frac tank rentals, fishing and rental tools,
wireline services, air drilling and hot oiling. In addition, the Reporting
Person owns and produces oil and natural gas in the Permian Basin. The
address of the principal executive offices of the Reporting Person is Two
Tower Center, Twentieth Floor, East Brunswick, New Jersey 08816. The
address of the principal business offices of the Reporting Person is 6
Desta Drive, Suite 5900, Midland, Texas 79705.
Set forth on Annex A hereto is a schedule setting forth the
information required by General Instruction C to Schedule 13D with respect
to the executive officers and directors of the Reporting Person. Annex A
is incorporated by reference into this Item 2 and elsewhere in this
Statement as applicable.
During the past five years, the Reporting Person has not been (a)
convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors), or (b) a party to any civil proceeding of a judicial
or administrative body of competent jurisdiction as a result of which it
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, Federal
or State securities laws, or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The Reporting Person expended an aggregate amount of approximately
$9,761,800 of its working capital to purchase the Shares reported herein as
having been acquired for its account. In the ordinary course of business,
the Reporting Person funds a portion of its working capital requirements
through a credit facility established pursuant to an Amended and Restated
Credit Agreement dated as of June 6, 1997, as amended and restated through
November 6, 1997, as subsequently amended December 3, 1997, as further
amended April 28, 1998, with PNC Bank, National Association ("PNC"), as
administrative agent, and a syndicate of lenders. Such Agreement is filed
herewith as Exhibit A and the amendments of December 3, 1997, and April 28,
1998, are filed herewith as Exhibit B and C, respectively, and all are
incorporated herein by reference.
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PAGE 4 OF 10 PAGES
ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Person has acquired Shares in order to obtain a
substantial equity interest in the Issuer, with a view toward providing the
Reporting Person with an enhanced ability to consider its interest in the
Issuer and its alternatives with respect thereto. Depending upon market
conditions and such other factors as the Reporting Person considers
relevant from time to time, the Reporting Person may pursue various
possible courses of action with respect to the Issuer, including (a)
acquiring additional Shares or other securities of the Issuer in the open
market, in privately negotiated transactions or otherwise, (b) contacting
the Issuer, its representatives or other persons interested in the Issuer,
for the purpose of discussing the Issuer, seeking to merge with or acquire
the Issuer and other related matters, (c) seeking to merge with or acquire
the Issuer, and (d) disposing of some or all of the Shares held by it in
the open market or in privately negotiated transactions. Although the
foregoing activities represent the range of activities within the current
contemplation of the Reporting Person, it should be noted that the
activities within such contemplated range are subject to change at any time.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) An aggregate of 820,500 Shares, or 7.4% of the total outstanding
Shares of the Issuer, are beneficially owned by the Reporting Person. The
calculation of the percentage of outstanding Shares of the Issuer
beneficially owned by the Reporting Person is based on 11,154,877 Shares
outstanding, which is the number of outstanding Shares reported in the
Issuer's most recent Report on Form 10-Q for the quarterly period ended
December 31, 1997.
(b) The Reporting Person has the sole power to vote and the sole
power to dispose of the 820,500 Shares reported herein as being
beneficially owned by it.
(c) Other than the transactions disclosed on Annex B hereto
(which is incorporated herein by reference), all of which were effected in
routine brokerage transactions in the over-the-counter market, there have
been no transactions with respect to the Shares in the past 60 days prior
to the date hereof by the Reporting Person.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER.
Not applicable.
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PAGE 5 OF 10 PAGES
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
A. Amended and Restated Credit Agreement, dated as of June 6, 1997,
as amended and restated through November 6, 1997, among the
Reporting Person, PNC Bank, National Association, as
Administrative Agent, and several other financial institutions
(incorporated by reference to Exhibit 10(s) to the Reporting
Person's Form 10-Q for the quarterly period ended December 31,
1997, File No. 000-22665).
B. First Amendment to the Amended and Restated Credit Agreement of
June 6, 1997, as amended and restated through November 6, 1997,
dated December 3, 1997 (incorporated by reference to Exhibit
10(t) to the Reporting Person's Form 10-Q for the quarterly
period ended December 31, 1997, File No. 000-22665).
C. Second Amendment to the Amended and Restated Credit Agreement of
June 6, 1997, as amended and restated through November 6, 1997,
as amended December 3, 1997, dated April 28, 1998.
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PAGE 6 OF 10 PAGES
SIGNATURE
After reasonable inquiry and to the best of my knowledge
and belief, the undersigned certifies that the information set forth in
this statement is true, complete and correct.
Date: June 15, 1998
KEY ENERGY GROUP, INC.
By: /s/ Francis D. John
----------------------------
Name: Francis D. John
Title: Chairman, President
and Chief Executive Officer
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PAGE 7 OF 10 PAGES
ANNEX A
Directors and Executive Officers of the Reporting Person
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<TABLE>
<CAPTION>
Name Business Address Title Principal Occupation
- ---- ---------------- ----- --------------------
<S> <C> <C> <C>
Francis D. John Key Energy Group, Inc. Chairman, President Chairman, President and
Two Tower Center, Twentieth Floor, and Chief Executive Chief Executive Officer
East Brunswick, NJ 08816 Officer of Reporting Person
Kevin P. Collins The Old Hill Company, L.L.C. Director Managing Member of The
21 Old Hill Farms Road Old Hill Company, L.L.C.
Westport, CT 06880
William Manly Oak Ridge National Laboratory Director Retired
P.O. Box 2008
Building 4500 South, MS 6153
Oak Ridge, TN 37831-6153
W. Phillip Marcum Marcum Natural Gas Services, Inc. Director President and Chief Executive
1675 Broadway, Suite 2150 Officer of Marcum Natural Gas
Denver, Colorado 80202 Services, Inc.
David J. Breazzano DDJ Capital Management, LLC Director Principal of DDJ Capital
141 Linden Street Management, LLC
Suite S-4
Wellesley, MA 02181
Morton Wolkowitz Key Energy Group, Inc. Director Private Investor
Two Tower Center, Twentieth Floor,
East Brunswick, NJ 08816
Kenneth V. Huseman Key Energy Group, Inc. Executive Vice Chief Operating Officer
6 Desta Drive, Suite 5900, President and Chief of the Reporting Person
Midland, Texas 79705 Operating Officer
Stephen E. McGregor Key Energy Group, Inc. Executive Vice Chief Financial Officer
Two Tower Center, Twentieth Floor, President and Chief of the Reporting Person
East Brunswick, NJ 08816 Financial Officer
Danny R. Evatt Key Energy Group, Inc. Vice President of Chief Accounting
6 Desta Drive, Suite 5900, Financial Operations Officer of the Reporting
Midland, Texas 79705 and Chief Information Person
Officer
</TABLE>
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PAGE 8 OF 10 PAGES
ANNEX A (cont.)
Each of the above-listed persons is a United States citizen. To the best
of the Reporting Person's knowledge, except as set forth in this Statement,
none of the above persons:
(a) has been (i) convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors), or (ii) a party to
any civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which he was or is subject
to a judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, Federal or
State securities laws, or finding any violation with respect to
such laws;
(b) has sole or shared voting or sole or shared dispositive power
over any Shares, except that Mr. Collins is the beneficial owner
of 9,354 Shares and Mr. Marcum is the beneficial owner of 6,054
Shares;
(c) has any contracts, arrangements, understandings or
relationships with respect to the Shares or any other securities
of the Issuer; and
(d) has engaged in any transactions involving the Shares in the past
60 days prior to the date hereof.
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PAGE 9 OF 10 PAGES
ANNEX B
RECENT TRANSACTIONS IN THE COMMON STOCK OF
DAWSON PRODUCTION SERVICES, INC.
<TABLE>
<CAPTION>
Date of Transaction Nature of Transaction Number of Shares Price per Share
- ------------------- --------------------- ---------------- ---------------
<S> <C> <C> <C>
5/11/98 Open Market Purchase 10,000 $12.6250
5/11/98 Open Market Purchase 51,500 $12.7500
5/12/98 Open Market Purchase 100,000 $12.7500
5/21/98 Open Market Purchase 229,400 $12.8750
5/22/98 Open Market Purchase 100,900 $12.7500
5/27/98 Open Market Purchase 30,000 $12.7500
6/1/98 Open Market Purchase 28,200 $10.8218
6/3/98 Open Market Purchase 79,400 $10.2500
6/3/98 Open Market Purchase 23,100 $10.1250
6/3/98 Open Market Purchase 25,000 $10.1875
6/4/98 Open Market Purchase 96,400 $10.2500
6/4/98 Open Market Purchase 7,600 $10.2188
6/5/98 Open Market Purchase 23,000 $10.4375
6/5/98 Open Market Purchase 16,000 $10.5000
TOTAL: 820,500
</TABLE>
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PAGE 10 OF 10 PAGES
EXHIBIT INDEX
EXHIBIT
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A. Amended and Restated Credit Agreement, dated as of June 6, 1997, as
amended and restated through November 6, 1997, among the Reporting Person,
PNC Bank, National Association, as Administrative Agent, and several other
financial institutions (incorporated by reference to Exhibit 10(s) to the
Reporting Person's Form 10-Q for the quarterly period ended December 31,
1997, File No. 000-22665).
B. First Amendment to the Amended and Restated Credit Agreement of June 6,
1997, as amended and restated through November 6, 1997, dated December 3,
1997 (incorporated by reference to Exhibit 10(t) to the Reporting Person's
Form 10-Q for the quarterly period ended December 31, 1997, File No.
000-22665).
C. Second Amendment to the Amended and Restated Credit Agreement of June 6,
1997, as amended and restated through November 6, 1997, as amended
December 3, 1997, dated April 28, 1998.
<PAGE>
Exhibit C
- ---------
SECOND AMENDMENT TO CREDIT AGREEMENT
SECOND AMENDMENT, dated as of April 28, 1998 (this "Amendment"),
to the Amended and Restated Credit Agreement, dated as of June 6, 1997, as
amended and restated through November 6, 1997 and as amended by the First
Amendment thereto dated as of December 3, 1997 (the "Credit Agreement"),
among Key Energy Group, Inc., a Maryland corporation (the "Borrower"), the
several Lenders from time to time parties thereto, PNC Bank, National
Association, as Administrative Agent and Norwest Bank Texas, N.A., as
Collateral Agent.
The parties hereto hereby agree as follows:
1. Defined Terms. Unless otherwise defined herein, terms which
are defined in the Credit Agreement and used herein (and in the recitals
hereto) as defined terms are so used as so defined.
2. Limitation on Investment Loans and Advances. Section 7.9 of
the Credit Agreement is hereby amended by (i) deleting the word "and" at
the end of clause (n) thereof, (ii) adding a semi-colon and the word "and"
at the end of clause (o) thereof and (iii) adding a new clause (p) which
shall be and read as follows:
"(p) additional investments not to exceed $10,000,000 in the
aggregate."
3. Conditions to Effectiveness of this Amendment. The
effectiveness of this Amendment is subject to the satisfaction of the
following conditions precedent:
(a) Execution. The Administrative Agent shall have received
this Amendment, executed and delivered by a duly authorized officer of
the Borrower and the Required Lenders and (ii) the attached
Acknowledgement and Consent, executed and delivered by a duly
authorized officer of each of the signatories thereto.
(b) No Default. No Default or Event of Default shall have
occurred and be continuing on the date hereof or after giving effect
to the amendment contemplated hereby.
(c) Representations and Warranties. Except to the extent that
they are made as of a specific date, each of the representations and
warranties made by any Loan Party in or pursuant to the Loan Documents
shall be true and correct in all material respects on and as of the
date hereof as if made on and as of the date hereof.
4. Miscellaneous.
(a) Effect. Except as expressly amended hereby, all of the
representations, warranties, terms, covenants and conditions of the Loan
Documents shall remain unamended and not waived and shall continue to be in
full force in effect.
(b) Counterparts. This Amendment may be executed by one or more
of the parties to this Amendment on any number of separate counterparts
(including by telecopy), and all of said counterparts taken together shall
be deemed to constitute one and the same instrument. A set of the copies
of this Amendment signed by all the parties shall be lodged with the
Borrower and the Administrative Agent.
<PAGE>
PAGE 2
(c) Severability. Any provision of this Amendment which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
(d) Integration. This Amendment and the other Loan Documents
represent the agreement of the Loan Parties, the Administrative Agent, the
Collateral Agent and the Lenders with respect to the subject matter hereof,
and there are no promises, undertakings, representations or warranties by
the Administrative Agent, the Collateral Agent or any Lender relative to
the subject matter hereof not expressly set forth or referred to herein or
in the other Loan Documents.
(e) GOVERNING LAW. THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
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PAGE 3
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.
KEY ENERGY GROUP, INC.
By: /s/ Francis D. John
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Title: President
PNC BANK, NATIONAL ASSOCIATION,
as Administrative Agent and as a
Lender
By: /s/ Thomas A. Majeski
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Title: Vice President
NORWEST BANK TEXAS, N.A.
as Collateral Agent and as a Lender
By: /s/ Mark D. McKinney
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Title: Senior Vice President
THE BANK OF NEW YORK
By: /s/ Catherine G. Goff
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Title: Vice President
BHF-BANK AKTIENGESELLSCHAFT
By: /s/ Paul Travers
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Title: Vice President
By: /s/ John Sykes
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Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH
By: /s/ Phillippe Soustra
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Title: Senior Vice President
HIBERNIA NATIONAL BANK
By: /s/ Byron P. Kives
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Title: Assistant Vice President
COMMERCIAL LOAN FUNDING TRUST I
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PAGE 4
By: LEHMAN COMMERCIAL PAPER INC.,
not in its individual capacity but
solely as Administrative Agent
By: /s/ Michele Swanson
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Title: Authorized Signatory
BANK ONE, TEXAS, N.A., as a
Purchasing Lender
By: /s/ W.M. Mark Crammer
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Title: Vice President
CORESTATES BANK, N.A., as a
Purchasing Lender
By: /s/ Laura J. Rowley
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Title: Assistant Vice President
DEN NORSKE BANK ASA, as a
Purchasing Lender
By: /s/ Byron L. Cooley
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Title: Senior Vice President
By: /s/ J. Morton Kreutz
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Title: Vice President
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Robert G. Sperhac
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Title: Vice President
GOLDMAN SACHS CREDIT PARTNERS L.P.,
as a Purchasing Lender
By: /s/ Stephen B. King
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Title: Authorized Signatory
FUJI BANK
By: /s/ Philip C. Lauinger III
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Title: Vice President and Manager
THE BANK OF NOVA SCOTIA
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PAGE 5
By: /s/ F.C.H. Ashby
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Title: Senior Manager Loan Operations
BANK POLSKA KASA OPIEKE S.A.
By: ________________________________
Title:
BANK LEUMI, USA
By: ________________________________
Title:
