FORT WORTH, Texas, Jan. 10, 2022 /PRNewswire/ -- Wilks Brothers, LLC ("Wilks") today announced that WB Acquisitions Inc., a subsidiary of Wilks ("Merger Sub"), Dawson Geophysical Company (NASDAQ: DWSN) ("Dawson") and Wilks, have agreed to a series of amendments to the Agreement and Plan of Merger, dated October 25, 2021 as amended by Amendment No. 1 dated December 14, 2021 and Amendment No. 2 dated January 4, 2022, by and among Dawson, Wilks and Merger Sub (as so amended, the "Merger Agreement") that are intended to facilitate completion of the Offer and the back end merger.
First, the Merger Agreement is being amended to decrease the 80% Minimum Condition from 80% to 66.67% (the "Minimum Condition"). Assuming the other Offer Conditions are satisfied, Merger Sub intends to accept for purchase and pay for all of the Shares validly tendered in the Offer if the Minimum Condition is satisfied on the Expiration Date. Promptly following the completion of the Offer, Dawson intends to convene a special meeting of Dawson's shareholders at which such shareholders will be asked to approve the merger of Merger Sub with and into Dawson, with Dawson surviving such merger (the "Merger"). Merger Sub intends to vote all of the Shares it owns, including the Shares acquired in the Offer, in favor of the Merger at such Dawson shareholder meeting.
If Merger Sub completes the Merger, Dawson shareholders not tendering their Shares in the Offer (other than Dawson or any of its subsidiaries, the Parent Related Entities or any shareholders who have properly exercised their appraisal rights) will receive cash in an amount equal to the $2.34 Offer Price, without interest and less any required withholding taxes. In addition, Dawson, as the surviving corporation in the Merger, will become a subsidiary of Parent and its affiliates, and the Shares will no longer be publicly traded.
If Merger Sub does not complete the Merger, then the shareholders of Dawson not tendering in the Offer will not receive any consideration and will become minority shareholders in a company over which Wilks and its affiliates have significant influence. In addition, there may be so few remaining shareholders and publicly traded shares that there will no longer be an active or liquid public trading market for Shares. In addition, Dawson may no longer be required to make filings with the SEC and the number of outstanding shareholders could be reduced to a number which requires delisting of Dawson's shares from the NASDAQ.
Second, the Merger Agreement has been amended to provide for Stephen Jumper, Craig Cooper and Michael Klofas to resign from Dawson's Board of Directors, with Mark Vander Ploeg and Ted North continuing as directors, and for the appointment to Dawson's Board of Matt Wilks, Sergei Krylov and Bruce Bradley, in each case, effective as of the Acceptance Time. Mr. Jumper is expected to remain with Dawson and continue as its Chief Executive Officer.
Finally, the parties have extended the previously commenced cash Offer by Merger Sub to purchase all of the issued and outstanding Shares of common stock of Dawson to 5:00 p.m., New York City time, on January 14, 2022. The Offer was previously scheduled to expire at 11:59 p.m., New York City time, on January 7, 2022. American Stock Transfer & Trust Company, LLC, the depositary for the Offer, has advised Wilks that, as of 6:00 p.m., New York City time, on January 7, 2022, the Shares tendered pursuant to the Offer together with the Shares owned by Wilks and its affiliates, represented approximately 71.57% of Dawson's outstanding Shares. Shareholders who have already tendered their Shares do not have to re-tender their Shares or take any other actions as a result of the extension.
Wilks encourages Dawson stockholders to tender during the extension period. As previously publicly disclosed by Dawson, weak market conditions have resulted in accelerating cash burn rates, declining accounts receivable balances and minimal opportunities to further reduce costs and capital expenditures. It is Wilks' belief that Dawson, as a private entity, would be better equipped to control costs for the unknown duration of a challenging market environment. Wilks believes the Offer price offered to stockholders of Dawson continues to be the optimal value currently available, and Wilks also believes that further delays and continuing market conditions will likely erode value for all stakeholders. As a result of potential further value erosion, Wilks believes haste is warranted to ensure the ability to deliver optimal value for stakeholders.
The Offer is subject to the Offer to Purchase, and all capitalized terms used but not otherwise defined herein shall have the meanings given in the Offer to Purchase and Merger Agreement.
D.F. King & Co., Inc. is the information agent for the Offer and any questions or requests for the Offer to Purchase and related materials with respect to the Offer may be directed to them by telephone, toll-free, at (800) 207-3158, if a stockholder, or by calling (212) 269-5550, if a bank or broker.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offering, solicitation or sale would be unlawful.
Forward-Looking Statements
Information provided and statements contained in this press release that are not purely historical, such as statements regarding expectations about the Offer, the expected timing of the completion of the transaction and the ability to complete the transaction considering the various closing conditions, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements only speak as of the date of this press release, and Wilks assumes no obligation to update the information included in this press release. Statements made in this press release that are forward-looking in nature may involve risks and uncertainties. Accordingly, readers are cautioned that any such forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict, including, without limitation, the possibility that the transaction does not close, the possibility that the offer is consummated but the shareholder approval to complete the Merger is not obtained, the risk that business disruption relating to the transaction may be greater than anticipated, the failure to obtain any required financing on favorable terms and other specific risk factors discussed herein and in other releases and public filings made by Dawson and Wilks (including filings with the SEC). Although Wilks believes that the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward-looking statements. Unless otherwise required by law, Wilks also disclaims any obligation to update its view of any such risks or uncertainties or to announce publicly the result of any revisions to the forward-looking statements made in this press release.
Important Additional Information and Where to Find It
This communication is neither an offer to purchase nor a solicitation of an offer to sell any Shares or any other securities. On November 1, 2021, Wilks filed a tender offer statement on Schedule TO, including an offer to purchase, a letter of transmittal and related documents, with the SEC. On the same date, Dawson filed a solicitation/recommendation statement on Schedule 14D-9 with respect to the Offer. The offer to purchase the Shares will only be made pursuant to the offer to purchase, the letter of transmittal and related documents filed with such Schedule TO. Investors and security holders are urged to read both the tender offer statement and the solicitation/recommendation statement regarding the Offer, as they may be amended from time to time, when they become available because they will contain important information that should be read carefully before making any decision with respect to the Offer. The tender offer statement has been filed with the SEC by Wilks and the solicitation/recommendation statement has been filed with the SEC by Dawson. Investors and security holders may obtain a free copy of these statements, any amendments thereto, the Merger Agreement and other documents filed with the SEC at the website maintained by the SEC at www.sec.gov or by directing such requests to the information agent for the Offer.
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SOURCE Wilks Brothers, LLC
