MIDLAND, Texas, March 21, 2011 /PRNewswire/ -- Dawson Geophysical
Company (Dawson) (Nasdaq: DWSN)
and TGC Industries, Inc. (TGC) (Nasdaq: TGE) today announced they
have entered into a merger agreement dated March 20, 2011 whereby Dawson will acquire TGC in a tax-free
stock-for-stock transaction. The combined company will retain
the Dawson name and trading
symbol.
Based on the NASDAQ closing prices of Dawson and TGC shares on Friday, March 18, 2011, the transaction is valued
at approximately $157 million,
representing approximately $8.00 per
TGC share.
Pursuant to the terms of the merger agreement, at the effective
time of the merger, TGC shareholders will receive 0.188 shares of
Dawson stock for every one share
of TGC stock, provided that the average of the volume weighted
average price of Dawson common
stock on the NASDAQ during the ten consecutive trading days ending
on the second business day prior to the date of the shareholders'
meetings of Dawson and TGC to be
called for the purpose of approving the transaction is equal to or
greater than $32.54 but less than or
equal to $52.54. In the event
that the average of the volume weighted average price of
Dawson's common stock is outside
of that range, then the parties, at their respective option, shall
be entitled to terminate the transaction following good faith
negotiations to determine a modified, mutually acceptable exchange
ratio. For the ten consecutive trading days ended
March 18, 2011, the average of the
volume weighted average price of Dawson's common stock was $44.16.
At the closing of the transaction, it is anticipated that
Dawson will issue approximately
3.7 million shares in exchange for the approximately 19.6 million
shares of TGC stock outstanding. Upon completion of the
transaction, Dawson will have
approximately 11.7 million shares outstanding, with current
Dawson shareholders owning
approximately 68% of the combined company and current TGC
shareholders owning approximately 32%.
Boards of Directors of both companies have approved the
transaction, and directors and officers representing approximately
29% of TGC outstanding shares and approximately 4% of Dawson outstanding shares have agreed to vote
in favor of the Merger.
The closing of the transaction is anticipated to be completed by
late second quarter or early third quarter of 2011, subject to
approval by holders of 80% of the outstanding shares of TGC and a
majority of the Dawson shares
present and voting at the special meeting, as well as certain other
closing conditions and regulatory approvals.
Raymond James & Associates,
Inc. served as financial advisor to Dawson while Southwest Securities, Inc. served
as financial advisor to TGC.
Upon closing of the transaction, Wayne
Whitener, President, CEO and Director of TGC, will join the
Board of Directors of Dawson along
with Allen T. McInnes, Ph.D.,
current TGC Director and Dean of the Texas Tech Jerry S. Rawls
College of Business Administration. Mr. Whitener will
continue as President and Chief Operating Officer of TGC, which
after the transaction will be a wholly owned subsidiary of
Dawson. Rob Wood, President of Eagle Canada, TGC's
wholly owned Canadian subsidiary, will remain in his role as
President of Eagle Canada. Each of these named executives
will enter into three-year employment agreements with the
continuing entity.
Stephen Jumper, President and
Chief Executive Officer of Dawson,
said: "We are excited to welcome the shareholders of TGC as
shareholders of Dawson.
Likewise, we are excited to welcome the employees of TGC and
its subsidiary Eagle Canada, Inc. to the Dawson family along with their respective
clients."
Jumper continued: "We believe the combination of these companies
provides opportunities to better serve the combined company's
expanded client base with higher channel count capacity, greater
geographic diversification of the combined entity operations and
blending of operational, technical and regional expertise.
With the ability to share equipment and personnel resources,
the combined companies will be able to provide its clients with the
required channel counts to produce higher resolution images,
enhanced efficiencies related to logistical improvements of crew
timing while increasing utilization rates for all crews with an
expanded order book."
Wayne Whitener, President and
Chief Executive Officer of TGC, said: "We are pleased to join
forces with Dawson Geophysical to create a strong and more dynamic
organization capable of providing a multitude of seismic and
geophysical services to our combined client base. We are
excited about the market position and growth potential of Dawson
Geophysical going forward. This transaction is a clear
win-win for our shareholders, clients and employees. I look
forward to our contributing to the success of the combined
organization."
Jumper concluded: "The timing of this transaction creates an
expanded opportunity to benefit all of our clients as demand for
advanced seismic services continues to increase in the lower 48
states and Canada. The
combined operating platform – services, people and equipment –
positions our shareholders and employees to capture any upside in
the onshore North American seismic market."
Dawson and TGC have scheduled a
conference call to discuss the transaction for Monday, March 21, 2011, at 8:30 a.m. Eastern Time / 7:30 a.m. Central Time. To participate in the
conference call, dial 866-322-9730 and use passcode 53785025 at
least 10 minutes before the call begins and ask for the Dawson
Geophysical / TGC Industries conference call. A replay of the call
will be available approximately two hours after the live broadcast
ends and will be accessible through March
23, 2011. To access the replay, dial 800-642-1687 using a
passcode of 53785025. Any materials to be utilized by
Dawson and TGC during the
conference call will be posted to their respective websites at
http://www.dawson3d.com and http://www.tgcseismic.com.
Investors, analysts, and the general public will also have the
opportunity to listen to the conference call over the Internet by
visiting http://www.dawson3d.com or http://www.tgcseismic.com. For
those who cannot listen to the live webcast, an archive will be
available shortly after the call and will remain available for
approximately twelve months on both above-mentioned websites.
Important Information For Investors and Shareholders
This release does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval. The transactions contemplated by the merger
agreement, including the proposed merger and the proposed issuance
of Dawson common stock in the
merger, will, as applicable, be submitted to the shareholders of
Dawson and TGC for their
consideration. Dawson will file
with the Securities and Exchange Commission (SEC) a registration
statement on Form S-4 that will include a joint proxy statement of
Dawson and TGC that also
constitutes a prospectus of Dawson. Dawson and TGC will mail the joint proxy
statement/prospectus to their respective shareholders. Dawson and TGC also plan to file other
documents with the SEC regarding the proposed transaction.
INVESTORS AND SECURITY HOLDERS OF DAWSON AND TGC ARE URGED TO READ
THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS
THAT WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY
WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and
shareholders will be able to obtain free copies of the joint proxy
statement/prospectus and other documents containing important
information about Dawson and TGC,
once such documents are filed with the SEC, through the website
maintained by the SEC at http://www.sec.gov. Dawson and TGC make available free of charge
at http://www.dawson3d.com and http//:www.tgcseismic.com,
respectively (in the "Investor Relations" section), copies of
materials they file with, or furnish to, the SEC, or investors and
shareholders may contact Dawson at
(432) 684-3000 or TGC at (972) 881-1099 or c/o Dennard Rupp Gray & Lascar, LLC, at (713)
529-6600 to receive copies of documents that each company files
with or furnishes to the SEC.
Participants in the Merger Solicitation
Dawson, TGC, and certain of
their respective directors and officers may be deemed to be
participants in the solicitation of proxies from the shareholders
of Dawson and TGC in connection
with the proposed transactions. Information about the directors and
officers of Dawson is set forth in
its proxy statement for its 2011 annual meeting of shareholders,
which was filed with the SEC on December 7,
2010. Information about the directors and officers of TGC is
set forth in its proxy statement for its 2010 annual meeting of
shareholders, which was filed with the SEC on April 23, 2010. These documents can be obtained
free of charge from the sources indicated above. Other information
regarding the participants in the proxy solicitation and a
description of their direct and indirect interests, by security
holdings or otherwise, will be contained in the joint proxy
statement/prospectus and other relevant materials to be filed with
the SEC when they become available.
About Dawson Geophysical
Dawson Geophysical Company is the leading provider of U.S.
onshore seismic data acquisition services as measured by the number
of active data acquisition crews. Founded in 1952, Dawson acquires and processes 2D, 3D and
multi-component seismic data solely for its clients, ranging from
major oil and gas companies to independent oil and gas operators as
well as providers of multi-client data libraries.
About TGC Industries
TGC Industries, Inc., based in Plano,
Texas, is a provider of seismic data acquisition services
with operations throughout the continental United States and Canada. The Company has branch offices
in Houston, Midland, Oklahoma
City and Calgary.
Safe Harbor Provisions
In accordance with the Safe Harbor provisions of the Private
Securities Litigation Reform Act of 1995, Dawson Geophysical
Company and TGC Industries, Inc. caution that statements in this
press release which are forward-looking and which provide other
than historical information involve risks and uncertainties that
may materially affect Dawson's or
TGC's actual results of operations. These risks include but are not
limited to the volatility of oil and natural gas prices, dependence
upon energy industry spending, disruptions in the global economy,
industry competition, delays, reductions or cancellations of
service contracts, high fixed costs of operations, external factors
affecting Dawson's or TGC's crews
such as weather interruptions and inability to obtain land access
rights of way, whether either company enters into turnkey or term
contracts, crew productivity, limited number of customers, credit
risk related to Dawson's or TGC's
customers, the availability of capital resources and operational
disruptions. A discussion of these and other factors, including
risks and uncertainties with respect to Dawson is set forth in Dawson's Form 10-K for the fiscal year ended
September 30, 2010, and with respect to TGC, is set forth in
TGC's Form 10-K for the fiscal year ended December 31, 2010. Dawson and TGC disclaim any intention or
obligation to revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
Company
Contact
Dawson Geophysical
Company
Stephen C. Jumper, President
& CEO
Christina W. Hagan,
CFO
(800) 332-9766
www.dawson3d.com
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Company
Contact
TGC Industries
Wayne Whitener, President &
CEO
(972) 881-1099
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Company
Contact
EnerCom, Inc.
Gregory B. Barnett,
President
Anthony D. Andora, Managing
Director
(303) 296-8834
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Company
Contact
DRG&L
Jack Lascar
(713) 529-6600
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SOURCE Dawson Geophysical Company