<PAGE>
 
  The Energy Industries Sale will have no federal income tax consequences to
stockholders of the Company in their capacity as stockholders.  The Company
believes that the total amount of taxable gain that the Company will recognize
as a result of the Energy Industries Sale will be approximately $47.7 million
for tax purposes.  The Company estimates that the recognition of such gain will
increase the Company's United States federal and state income and franchise tax
liability by approximately $14.0 million.

FINANCIAL INFORMATION

  For selected financial data of the Company and unaudited pro forma
consolidated financial statements showing the effect of the consummation of the
Energy Industries Sale and Cimarron Sale, see "Selected Financial Data" and
"Unaudited Pro Forma Consolidated Financial Statements".

ACCOUNTING TREATMENT

  The Energy Industries Sale will be subject to purchase accounting treatment.

REGULATORY APPROVALS

  The Company is not aware of any federal or state regulatory approvals that
must be obtained in order to consummate the Energy Industries Sale except that
the Energy Industries Sale is reportable under, and subject to the waiting
period requirements of, the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended ("HSR Act"), by the Company and Enterra.

  Under the HSR Act and the rules promulgated thereunder by the Federal Trade
Commission (the "FTC"), certain acquisition transactions may not be consummated
unless notice has been given and certain information has been furnished to the
Antitrust Division of the United States Department of Justice (the "Antitrust
Division") and the FTC and specified waiting period requirements have been
satisfied.  The Company and Enterra each filed with the Antitrust Division and
the FTC a Notification and Report Form with respect to the Energy Industries
Sale on September 28, 1995.  Assuming that the filings are in substantial
compliance with the HSR Act, the required waiting period for the Energy
Industries Sale will expire on October 28, 1995 unless extended by a request for
additional information or documentary material or unless early termination of
the waiting period is granted.  If either the FTC or the Antitrust Division
requests additional information or documents from the Company or Enterra within
such initial waiting period, the applicable waiting period will be extended for
an additional 20 days from the date of substantial compliance with such request.
At any time before or after the consummation of the Energy Industries Sale, it
is possible that the FTC or the Antitrust Division could take such action under
the United States antitrust laws as such agency deems necessary or desirable in
the public interest, including seeking to enjoin the Energy Industries Sale.

RELATION TO THE CIMARRON SALE PROPOSAL

  Neither the Energy Industries Sale Proposal nor the Cimarron Sale Proposal is
conditioned on the other. 

CERTAIN INFORMATION CONCERNING ENTERRA

  Enterra's business generally consists of oilfield services, gas compression
services and pipeline services.  Enterra's principal executive offices are
located at 13100 Northwest Freeway, Sixth Floor, Houston, Texas  77050,
telephone number (713) 462-7300.

  For a summary of the negotiations between Enterra and the Company relating to
the Energy Industries Sale Proposal, see "The Energy Industries Sale
Proposal--Background of the Energy Industries Sale Proposal".

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