As filed with the Securities and Exchange Commission on March 12, 2004
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
---------------------
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
--------------------
DAWSON GEOPHYSICAL COMPANY
(Exact name of issuer as specified in its charter)
TEXAS 75-0970548
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
508 WEST WALL, SUITE 800 79701
MIDLAND, TEXAS (Zip Code)
(Address of principal executive offices)
DAWSON GEOPHYSICAL COMPANY
2004 INCENTIVE STOCK PLAN
(Full Title of the Plan)
------------------------
L. DECKER DAWSON, CHAIRMAN OF THE BOARD
AND CHIEF EXECUTIVE OFFICER
DAWSON GEOPHYSICAL COMPANY
508 WEST WALL, SUITE 800
MIDLAND, TEXAS 79701
(432) 684-3000
(Name and address, including zip code, and telephone number,
including area code, of agent for service)
COPIES TO:
DAN G. LEROY
COTTON, BLEDSOE, TIGHE & DAWSON
500 WEST ILLINOIS, SUITE 300
MIDLAND, TEXAS 79701
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CALCULATION OF REGISTRATION FEE
========================================= ========== ================= ================== ==================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
AMOUNT OFFERING AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE PRICE PER OFFERING REGISTRATION
TO BE REGISTERED REGISTERED UNIT (1) PRICE (1) FEE
- ----------------------------------------- ---------- ----------------- ------------------ ------------------
Common Stock, $0.33 1/3 par value....... 375,000 $11.58 $4,342,500 $550.20
========================================= ========== ================= ================== ==================
(1) Estimated solely for the purpose of computing the registration fee and
computed in accordance with Rule 457(h) based upon the average of the high
and low prices for securities of the same class as quoted on the Nasdaq
National Market on March 9, 2004.
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PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Note: The document(s) containing the information concerning the
Dawson Geophysical Company 2004 Incentive Stock Plan (the "Plan") required by
Item 1 of Form S-8 and the statement of availability of Registrant information
and other information required by Item 2 of this Form will be sent or given to
employees eligible to participate in the Plan as specified by Rule 428. In
accordance with Rule 428 and the requirements of Part I of Form S-8, such
documents are not being filed with the Securities and Exchange Commission (the
"Commission") either as part of this Registration Statement or as prospectuses
or prospectus supplements. The Registrant shall maintain a file of such
documents in accordance with the provisions of Rule 428. Upon request, the
Registrant shall furnish to the Commission or its staff a copy or copies of any
or all of the documents included in such file.
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PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents are incorporated herein by reference: (1)
the Annual Report on Form 10-K of Dawson Geophysical Company (the "Company") for
the fiscal year ended September 30, 2003; (2) the Company's Quarterly Report on
Form 10-Q for the quarter ended December 31, 2003 filed by the Company pursuant
to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), since the end of the fiscal year covered by the 10-K
Annual Report referred to in (1) above; and (3) the registration statement filed
by the Company under Section 12 of the Exchange Act, and any amendments thereto,
containing the description of the Common Stock of the Company, par value $0.33
1/3 per share.
All documents hereafter filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a
post-effective amendment of this Registration Statement which indicates that all
securities offered hereby have been sold or which deregisters all securities
then remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing of such
documents.
ITEM 4. DESCRIPTION OF SECURITIES.
The class of securities to be offered pursuant to this Registration
Statement have been registered under Section 12 of the Exchange Act by the
filing of a registration statement under the Exchange Act as described in Item 3
above.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
No expert named in the Registration Statement nor counsel for the
Company (1) was employed for such purpose on a contingent basis; (2) will
receive in connection herewith a substantial interest, direct or indirect, in
the Company or its subsidiaries; or (3) was a promoter, underwriter, voting
trustee, director, officer or employee of the Company.
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ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Seven of the Articles of Incorporation, as amended, the
Company provides as follows:
"A director of the corporation shall not be personally
liable to the corporation or its shareholders for monetary damages
for an act or omission in such director's capacity as a director,
except for liability for (i) a breach of a director's duty of
loyalty to the corporation or its shareholders; (ii) an act or
omission not in good faith or that involves intentional misconduct
or a knowing violation of the law; (iii) a transaction from which a
director received an improper benefit, whether or not the benefit
resulted from an action taken within the scope of the director's
office; (iv) an act or omission for which the liability of a
director is expressly provided by statue; or (v) an act related to
an unlawful stock repurchase or payment of a dividend. If the laws
of the State of Texas are hereafter amended to authorize corporate
action further eliminating or limiting the personal liability of a
director of the corporation, then the liability of a director of the
corporation shall thereupon automatically be eliminated or limited
to the fullest extent permitted by such laws. Any repeal or
modification of this Article Seven by the shareholders of the
corporation shall not adversely affect any right or protection of a
director existing at the time of such repeal or modification with
respect to events or circumstances occurring or existing prior to
such time."
Article IX of the Bylaws of the Company provides that:
"To the extent permitted by Texas Business Corporation
Act Article 2.02-1, the Corporation shall indemnify any present or
former Director, officer, employee, or agent of the Corporation
against judgments, penalties (including excise and similar taxes),
fines, settlements, and reasonable expenses actually incurred by the
person in connection with a proceeding in which the person was, is,
or is threatened to be made a named defendant or respondent because
the person is or was a Director, officer, employee, or agent of the
Corporation."
Article 2.02-1 of the Texas Business Corporation Act generally
permits corporations to indemnify, subject to certain limitations and
restrictions, a person who was or is a director, officer, employee, or agent of
a corporation or who serves at the corporation's request as a director, officer,
partner, proprietor, trustee, employee, or agent of another corporation,
partnership, trust, joint venture, or other enterprise, who was, is, or is
threatened to be named a defendant in a legal proceeding by virtue of such
person's position in the corporation or in an outside enterprise, but only if
the person conducted himself in good faith and reasonably believed, in the case
of conduct in the person's official capacity, that the conduct was in or, in the
case of all other conduct, that the conduct was at least not opposed to the
corporation's best interests, and, in the case of a criminal proceeding, the
person had no reasonable cause to
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believe the conduct was unlawful. A person may be indemnified within the above
limitations against judgments, penalties (including excise and similar taxes),
fines, settlements, and reasonable expenses actually incurred; however,
indemnification is limited to reasonable expenses actually incurred in a
proceeding in which the person is found liable to the corporation or is found to
have improperly received a personal benefit and shall not be made in respect of
any proceeding in which the person shall have been found liable for willful or
intentional misconduct in the performance of his duty to the corporation. A
corporation must indemnify a director, officer, employee, or agent against
reasonable expenses incurred in connection with a proceeding in which the person
is a party because of the person's corporate position, if the person was wholly
successful, on the merits or otherwise, in the defense of the proceeding. Under
certain circumstances, the corporation may also advance expenses to such person.
Article 2.02-1 of the Texas Business Corporation Act also permits a
corporation to purchase and maintain insurance or to make other arrangements on
behalf of any of the above persons against any liability asserted against and
incurred by the person in such capacity, or arising out of the person's status
as such a person, whether or not the corporation would have the power to
indemnify the person against the liability under applicable law.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
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ITEM 8. EXHIBITS.
Exhibit No. Description of Exhibit
----------- -------------------------------------------------------
4.1* Restated and Amended Articles of Incorporation of the
Company, filed as an exhibit to the Company's Form S-1
Registration Statement, Registration No. 33-85328.
4.2* Bylaws of the Company filed as an exhibit to the
Company's Annual Report on Form 10-K for the Fiscal
Year Ended September 30, 2003.
4.3* Rights Agreement by and between the Company and Mellon
Investor Services, LLC (f/k/a Chasemellon Shareholder
Services, L.L.C.), as Rights Agent, dated July 13,
1999, filed as an exhibit to the Company's Annual
Report on Form 10-K for the Fiscal Year Ended September
30, 2003.
5.1** Opinion of Cotton, Bledsoe, Tighe & Dawson, a
Professional Corporation.
10.1** Dawson Geophysical Company 2004 Incentive Stock Plan.
23.1** Consent of KPMG LLP.
23.2** Consent of Cotton, Bledsoe, Tighe & Dawson, a
Professional Corporation (such consent is included in
the Opinion filed as Exhibit 5.1 to this Registration
Statement.)
- --------------------------
*Incorporated by reference to the filing(s) indicated.
**Filed herewith.
ITEM 9. UNDERTAKINGS.
The Company 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;
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(ii) to reflect in the prospectus any facts or events
arising after the effective date of this 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 this
Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected
in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement; and
(iii) to include any material information with respect
to the plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not
apply if the registration statement is on Form S-3, Form S-8, or
Form F-3 and the information required to be included in the
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the
Company pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
Registration Statement.
(2) that, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment 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; and
(3) to remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
The Company hereby further undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Company's Annual Report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of the
Plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in this Registration Statement 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.
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Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Company of expenses incurred or paid by a director, officer or controlling
person of the Company 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 Company 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 Securities
Act of 1933 and will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Midland, State of Texas, on this 12th day of March,
2004.
DAWSON GEOPHYSICAL COMPANY
(Registrant)
By: /S/ L. DECKER DAWSON
-------------------------------------------
L. Decker Dawson, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
SIGNATURE TITLE DATE
- --------- ----- ----
/S/ L. DECKER DAWSON Chairman of the Board, Chief Executive March 12, 2004
- -------------------------------------- Officer and Director
L. Decker Dawson
/S/ STEPHEN C. JUMPER President, Chief Operating Officer March 12, 2004
- -------------------------------------- and Director
Stephen C. Jumper
/S/ HOWELL W. PARDUE Executive Vice President and Director March 12, 2004
- --------------------------------------
Howell W. Pardue
/S/ C. RAY TOBIAS Executive Vice President March 12, 2004
- -------------------------------------- and Director
C. Ray Tobias
/S/ PAUL H. BROWN Director March 12, 2004
- --------------------------------------
Paul H. Brown
/S/ CALVIN J. CLEMENTS Director March 12, 2004
- --------------------------------------
Calvin J. Clements
/S/ MATTHEW P. MURPHY Director March 12, 2004
- ------------------------------------
Matthew P. Murphy
/S/ TIM C. THOMPSON Director March 12, 2004
- --------------------------------------
Tim C. Thompson
/S/ GARY M. HOOVER Director March 12, 2004
- --------------------------------------
Gary M. Hoover, Ph.D.
/S/ CHRISTINA W. HAGAN Executive Vice President and March 12, 2004
- -------------------------------------- Chief Financial Officer
Christina W. Hagan
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INDEX TO EXHIBITS
Exhibit No. Description of Exhibit
----------- -------------------------------------------------------
4.1* Restated and Amended Articles of Incorporation of the
Company, filed as an exhibit to the Company's Form S-1
Registration Statement, Registration No. 33-85328.
4.2* Bylaws of the Company filed as an exhibit to the
Company's Annual Report on Form 10-K for the Fiscal
Year Ended September 30, 2003.
4.3* Rights Agreement by and between the Company and Mellon
Investor Services, LLC (f/k/a Chasemellon Shareholder
Services, L.L.C.), as Rights Agent, dated July 13,
1999, filed as an exhibit to the Company's Annual
Report on Form 10-K for the Fiscal Year Ended September
30, 2003.
5.1** Opinion of Cotton, Bledsoe, Tighe & Dawson, a
Professional Corporation.
10.1** Dawson Geophysical Company 2004 Incentive Stock Plan.
23.1** Consent of KPMG LLP.
23.2** Consent of Cotton, Bledsoe, Tighe & Dawson, a
Professional Corporation (such consent is included in
the Opinion filed as Exhibit 5.1 to this Registration
Statement.)
- --------------------------
*Incorporated by reference to the filing(s) indicated.
**Filed herewith.
EXHIBIT 5.1
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COTTON, BLEDSOE, TIGHE & DAWSON
A PROFESSIONAL CORPORATION
ATTORNEYS AT LAW
SUITE 300
500 WEST ILLINOIS
MIDLAND, TEXAS 79701-4337
P. O. BOX 2776
ZIP 79702-2776
TELEPHONE
(432) 684-5782
FAX (432) 682-3672
March 12, 2004
Dawson Geophysical Company
508 W. Wall, Suite 800
Midland, Texas 79701
Re: Registration Statement on Form S-8
Dawson Geophysical Company 2004 Incentive Stock Plan
Gentlemen:
We have acted as counsel for Dawson Geophysical Company, a Texas
corporation (the "Company") in connection with the registration under the
Securities Act of 1933, as amended (the "Act"), of 375,000 shares (the "Shares")
of the common stock, par value $0.33 1/3 per share (the "Common Stock") of the
Company reserved for issuance under the Dawson Geophysical Company 2004
Incentive Stock Plan (the "Plan"). A Registration Statement on Form S-8 (the
"Registration Statement") covering the sale of the Shares was filed under the
Act with the Securities and Exchange Commission (the "Commission").
In reaching the conclusions expressed in this opinion, we have
examined signed copies of the Registration Statement and all exhibits thereto.
We have also examined and relied upon originals or copies certified to our
satisfaction, of (i) the Articles of Incorporation and Bylaws of the Company,
(ii) minutes and records of the corporate proceedings of the Company with
respect to the issuance of the Shares and related matters, (iii) the Plan, and
(iv) such other agreements and instruments relating to the Company as we have
deemed necessary or appropriate for the purposes of the opinions hereinafter
expressed. In rendering such opinions, we have relied, to the extent we deemed
reasonable, on certificates and certain other information provided to us by
officers of the Company and public officials as to matters of fact
Dawson Geophysical Company
March 12, 2004
Page 2
of which the maker of such certificates or the person providing such information
had knowledge. Furthermore, in rendering such opinions we have assumed that the
signatures on all documents examined by us are genuine, that all documents and
corporate record books submitted to us as originals are authentic, accurate and
complete, and that all documents submitted to us as copies are true, correct and
complete copies of the originals thereof.
Based solely upon the foregoing, subject to the assumptions,
limitations and qualifications set forth herein, and specifically limited in all
respects to the laws of the State of Texas and the United States of America, we
are of the opinion that the Shares registered pursuant to the Registration
Statement have been duly and validly authorized by the Company, and when paid
for, issued or sold and delivered in accordance with the terms of the Plan such
Shares will be legally issued, fully paid and nonassessable.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement. In giving this consent we do not thereby admit that we
come within the category of persons whose consent is required under Section 7 of
the Act or the rules and regulations of the Commission promulgated thereunder.
This opinion is rendered only to the Company and solely for the
benefit of the Company and the Commission in connection with the registration
and the issuance of the Shares pursuant to the Registration Statement and the
Plan, respectively. This opinion may not be otherwise used, circulated, quoted,
relied upon, or referred to by you or the Commission for any other purpose or by
any other person, firm or corporation for any purpose, without our prior written
consent.
Yours very truly,
COTTON, BLEDSOE, TIGHE & DAWSON
By: /S/ DAN G. LEROY
------------------------------
Dan G. LeRoy
EXHIBIT 10.1
------------
DAWSON GEOPHYSICAL COMPANY
2004 INCENTIVE STOCK PLAN
1. PURPOSE
This Employee Incentive Stock Plan (the "Plan") is intended as an
incentive and to encourage stock ownership by certain officers and employees of
Dawson Geophysical Company or of its subsidiary companies as that term is
defined in Article 3 below (the "Subsidiaries"), so that they may acquire or
increase their proprietary interest in the success of the Company and
Subsidiaries and to encourage them to remain in the employ of the Company or of
the Subsidiaries. It is further intended that options issued pursuant to this
Plan shall constitute "incentive stock options" within the meaning of Section
422 of the Internal Revenue Code of 1986, as now or hereafter amended (the
"Code"), except as to those awards made pursuant to Article 11 of the Plan.
2. ADMINISTRATION
The Plan shall be administered by a committee appointed by the Board
of Directors of the Company (the "Committee"). The Committee shall consist of
not less than three members of the Company's Board of Directors. The Board of
Directors may from time to time remove members from or add members to the
Committee. Vacancies on the Committee, howsoever caused, shall be filled by the
Board of Directors. The Committee shall select one of its members as Chairman
and shall hold meetings at such times and places as it may determine. A majority
of the Committee at which a quorum is present or acts reduced to or approved in
writing by a majority of the members of the Committee shall be the valid acts of
the Committee. No director while a member of the Committee shall be eligible to
receive an option under the Plan. The Committee shall from time to time at its
discretion make recommendations to the Board of Directors with respect to the
employees who shall be granted options and the amount of stock to be optioned to
each. All members of the Committee and majority of directors of the Company
shall be disinterested persons (as that term is hereinafter defined) for
purposes of administering the Plan and determining the employees and amount of
stock to be optioned to each. The term "disinterested person" for purposes of
the Plan shall mean an administrator of a Plan who is not at the time he or she
exercises discretion in administering the Plan eligible and has not at any time
within one year prior thereto been eligible for selection as a person to whom
stock options may be granted pursuant to the Plan.
The interpretation and construction by the Committee of any
provisions of the Plan or any option granted under it shall be final unless
otherwise determined by the Board of Directors. No member of the Board of
Directors or the Committee shall be liable for any action or determination made
in good faith with respect to the Plan or any option granted under it.
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3. ELIGIBILITY
The persons who shall be eligible to receive options shall be such
executives and other employees (including officers, whether or not they are
directors) of the Company or its Subsidiaries existing from time to time as the
Board of Directors shall elect from time to time from among those nominated by
the Committee. An optionee may hold more than one option but only on the terms
and subject to the restrictions hereinafter set forth. No person shall be
eligible to receive an option for a larger number of shares than is recommended
for him or her by the Committee. No person owning more than ten percent (10%) of
the total combined voting power of all classes of stock of the Company, its
parent or subsidiary, shall be eligible to receive an incentive stock option
unless the option price is at least one hundred ten percent (110%) of the fair
market value of the optioned stock (as to which see paragraph 5 below).
4. STOCK
The stock subject to the options shall be shares of the Company's
authorized but unissued or reacquired $0.33 1/3 par value per share common stock
hereinafter sometimes called the "Stock." The aggregate number of shares which
may be issued under options shall not exceed 375,000 shares of Stock. The
limitations established by the preceding sentence shall be subject to adjustment
as provided in Article 5(h) of the Plan.
If any outstanding option under the Plan for any reason expires or
is terminated, the shares of the Stock allocatable to the unexercised portion of
such option may again be subjected to an option under the Plan.
The aggregate fair market value (determined at the time the option
is granted) of the Stock with respect to which options are exercisable for the
first time by any person eligible hereunder during any calendar year under this
Plan and any other plan qualifying under Section 422 of the Code which is
maintained by the Company and/or its Subsidiaries shall not exceed $100,000.
5. TERMS AND CONDITIONS OF OPTIONS
Stock options granted pursuant to the Plan shall be authorized by
the Board of Directors and shall be evidenced by agreements in such form as the
Committee shall from time to time recommend and the Board of Directors shall
from time to time approve, which agreements shall comply with and be subject to
the following terms and conditions:
(a) Optionee's Agreement. Each optionee shall agree to
remain in the employ of and to render to the Company or
Subsidiaries his or her services for a period of five
years from the date of the option, but such agreement
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shall not impose upon the Company or Subsidiaries any
obligation to retain the optionee in their employ for
any period.
(b) Number of Shares. Each option shall state the number of
shares to which it pertains.
(c) Option Price. Each option shall state the option price,
which shall be not less than 100% of the fair market
value of the shares of Stock of the Company on the date
of the granting of the option (110% in the case of an
over 10% shareholder; as to which see paragraph 3
above). The fair market value per share shall be deemed
to be the mean between the highest price and the lowest
price of which the Stock shall have been sold, regular
way, in the over-the-counter market or other applicable
market on the day the option is granted; or if no sale
of the Company's Stock shall have been made on any stock
exchange on that day, on the next preceding day on which
there was a sale of such Stock.
(d) Medium and Time of Payment. The option price shall be
payable in United States dollars upon the exercise of
the option and may be paid in cash or by check or
payment may be made with Stock of the Company.
(e) Term and Exercise of Options. Subject to other terms and
provisions herein contained, during the term of an
option the shares with respect to which that option may
be exercised shall become exercisable to the extent of
25% of the shares optioned on each of the four
anniversaries of the date of grant. Subject to the
foregoing, each option shall be exercisable in whole or
in part at any time and from time to time during its
term. Not less than one thousand (1,000) shares may be
purchased at any one time unless the number purchased is
the total number at the time purchasable under the
option. During the lifetime of the optionee, the option
shall be exercisable only by him or her and shall not be
assignable or transferable by him or her and no other
person shall acquire any rights therein. An option
granted under the Plan must be exercised by the earlier
of (a) five years from the date of the grant, or (b) the
applicable time limit specified in paragraphs (o) and
(g) of this Section 5. Any option not exercised within
the applicable aforementioned time period shall
automatically terminate at the expiration of such
period.
(f) Termination of Employment Except Death. If an optionee
shall cease to be employed by the Company or
Subsidiaries for any reason, other than his or her
death, and no longer shall be in the employ of any of
them, such optionee shall have the right to exercise the
option at any time within three months after such
termination of employment (one year if the optionee is
disabled within the meaning of Section 22(e)(3) of the
Code) to the extent his or her right to exercise such
option had not previously been exercised at the date of
such termination. Whether authorized leave of absence or
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absence for military or governmental service shall
constitute termination of employment, for the purposes
of the Plan, shall be determined by the Committee, which
determination, unless overruled by the Board of
Directors, shall be final and conclusive.
(g) Death of Optionee and Transfer of Option. If the
optionee shall die while in the employ of the Company or
a Subsidiary or within a period of three months after
the termination of his or her employment with the
Company and all Subsidiaries and shall not have fully
exercised the option, an option may be exercised,
subject to the condition that no option shall be
exercisable after the expiration of one year from the
date it is granted to the extent that the optionee's
right to exercise such option had accrued pursuant to
Article 5(3) of the Plan at the time of his or her death
and had not previously been exercised, at any time
within one year after the optionee's death, by the
executors or administrators of the optionee or by any
person or persons who shall have acquired the option
directly from the optionee by bequest or inheritance.
No option shall be transferable by the optionee
otherwise than by will or the laws of descent and
distribution.
(h) Recapitalization. Subject to any required action by the
stockholders, the number of shares of Stock covered by
each outstanding option and the price per share thereof
in each such option shall be proportionately adjusted
for any increase or decrease in the number of issued
shares of Stock of the Company resulting from a
subdivision or consolidation of shares or the payment of
a stock dividend (but only on the Stock) or any other
increase or decrease in the number of such shares
effected without receipt of consideration by the
Company.
Subject to any required action by the stockholders, if
the Company shall be the surviving company in any merger
or consolidation, each outstanding option shall pertain
to and apply to the securities to which a holder of the
number of shares of Stock subject to the option would
have been entitled. A dissolution or liquidation of the
Company or a merger or consolidation in which the
Company is not the surviving company shall cause each
outstanding option to terminate, provided that each
optionee shall, in such event, have the right
immediately prior to such dissolution or liquidation or
merger or consolidation in which the Company is not the
surviving company to exercise his or her option in whole
or in part.
Upon a change in the Stock of the Company as presently
constituted which is limited to a change of all its
authorized shares with par value into the same number of
shares with a different par value or without par value,
the shares resulting from any such change shall be
deemed to be the Stock within the meaning of the Plan.
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To the extent that the foregoing adjustments relate to
stock or securities of the Company, such adjustments
shall be made by the Committee, whose determination in
that respect shall be final, binding and conclusive,
provided that each option continues to qualify as an
incentive stock option within the meaning of Section 422
of the Code.
Except as hereinbefore expressly provided in this
Article 5(h), the optionee shall have no rights by
reason of any subdivisions or consolidation of shares of
stock of any class or the payment of any stock dividend
or any other increase or decrease in the number of
shares of stock of any class or by reason of any
dissolution, liquidation, merger or consolidation or
spin-off of assets or stock of another company, and any
issue by the Company of share of stock of any class, or
securities convertible into shares of stock of any
class, shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or
price of shares of Stock subject to the option.
The grant of an option pursuant to the Plan shall not
affect in any way the right or power of the Company to
make adjustments, reclassifications, reorganizations or
changes of its capital or business structure or to merge
or to consolidate or to dissolve, liquidate or sell, or
transfer all or any part of its business or assets.
(i) Rights as a Stockholder. An optionee or a transferee of
an option shall have no rights as a stockholder with
respect to any shares covered by his or her option until
the date of the issuance of a stock certificate to him
or her for such shares. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash,
securities or other property) or distributions or other
rights for which the record date is prior to the date
such stock certificate is issued, except as provided in
Article 5(g) hereof.
(j) Modification, Extension and Renewal of Options. Subject
to the terms and conditions and within the limitations
of the Plan, the Board of Directors may modify, extend
or renew outstanding options granted under the Plan, or
accept the surrender of outstanding options (to the
extent not theretofore exercised) and Board of Directors
shall not, however, modify any outstanding options so as
to specify a lower price or accept the surrender of
outstanding options and authorize the granting of new
options in substitution therefor specifying a lower
price. Notwithstanding the foregoing, however, no
modification of an option shall, without the consent of
the optionee, alter or impair any rights or obligations
under any option theretofore granted under the Plan.
(k) Investment Purpose. Each option under the Plan shall be
granted on the condition that the purchases of Stock
thereunder shall be for investment purposes and not with
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a view to resale or distribution except that if the
Stock subject to such option or distribution is
registered under the Securities Act of 1933, as amended,
or if a resale of such stock without such registration
would otherwise be permissible, such condition shall be
inoperative if in the opinion of counsel for the Company
such condition is not required under the Securities Act
of 1933 or any other applicable law, regulation, or rule
of any governmental agency.
(l) Other Provisions. The option agreements authorized under
the Plan shall contain such other provisions, including,
without limitation, restrictions upon the exercise of
the option, as the Committee and the Board of Directors
of the Company shall deem advisable. Any such option
agreement shall contain such limitations and
restrictions upon the exercise of the option as shall be
necessary in order that such option will be an
"incentive stock option" as defined in Section 422 of
the Code or to conform to any change in the law.
6. TERM OF THE PLAN
Options may be granted to the Plan from time to time within a period
of five years from the date the Plan is adopted, or the date the Plan is
approved by the stockholders, whichever is earlier.
7. INDEMNIFICATION OF COMMITTEE
In addition to such other rights of indemnification as they may have
as directors or as members of the Committee, the members of the Committee shall
be indemnified by the Company against the reasonable expenses, including
attorneys' fees actually and necessarily incurred in connection with the defense
of any action, suit or proceeding, or in connection with any appeal therein, to
which they or any of them may be a party by reason of any action taken or
failure to act under or in connection with the Plan or any option granted
thereunder, and against all amounts paid by them in settlement thereof (provided
such settlement is approved by independent legal counsel selected by the
Company) or paid by them in satisfaction of a judgment in any such action, suit
or proceeding that such Committee member is liable for negligence or misconduct
in the performance of his or her duties; provided that within 60 days after
institution of any such action, suit or proceeding a Committee member shall in
writing offer the Company the opportunity, at its own expense, to handle and
defend the same.
8. AMENDMENT OF THE PLAN
The Board of Directors of the Company may, insofar as permitted by
law, from time to time, with respect to any shares at the time not subject to
options, suspend or discontinue the Plan or revise or amend it in any respect
whatsoever except that, without approval of the stockholders no such revision or
amendment shall change the number of shares subject to the Plan, change the
designation of the class of employees eligible to
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receive options, decrease the price at which options may be granted, remove the
administration of the Plan from the Committee, or render any member of the
Committee eligible to receive an option under the Plan while serving thereon.
Furthermore, the Plan may not, without the approval of the stockholders, be
amended in any manner that will cause options issued under it to fail to meet
the requirements of incentive stock options as defined in Section 422 of the
Code, except as to those shares awarded under Article 11 of this Plan.
9. APPLICATION OF FUNDS
The proceeds received by the Company from the sale of Stock pursuant
to options will be used for general corporate purposes.
10. NO OBLIGATION TO EXERCISE OPTION
The granting of an option shall impose no obligation upon the
optionee to exercise such option.
11. STOCK AWARDS
The Committee may award to officers, directors and employees of the
Company shares of capital stock out of the 375,000 shares of Stock provided for
in Article 4 of the Plan for the purpose of additional compensation for
outstanding achievement and to encourage ownership of the Stock. These awards,
in the discretion of the Committee, may be made with or without payment therefor
by any officer, director or employee to whom such capital stock is made under
such terms and conditions as the Committee may in its sole discretion provide.
Such awards shall not constitute incentive stock options within the meaning of
Section 422 of the Code and shall not exceed 250,000 shares of Stock of the
375,000 shares of Stock provided for under Article 4 of the Plan. Of such
250,000 shares of Stock (a) 125,000 shares may be awarded without payment by any
officer, director, or employee to whom such capital stock is made under such
terms and conditions as the Committee in its sole discretion may provide and (b)
125,000 shares may be awarded with the restrictions that such shares shall not
be assignable nor may any other person acquire any rights therein and that the
officer, director or employee of the Company remain in the employment of the
Company for a period of not less than three years from the date of the award,
subject to such other terms and conditions as the Committee may in its sole
discretion may provide. Any shares not awarded under this Article 11 of the Plan
may be the subject of incentive stock options under the Plan.
12. EFFECTIVE DATE
Adoption of this Plan and shareholders' approval shall be effective
January 27, 2004.
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EXHIBIT 23.1
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CONSENT OF INDEPENDENT AUDITORS
The Board of Directors and Stockholders
Dawson Geophysical Company:
We consent to the incorporation by reference in the registration statement
(No.333-XXXXX) on Form S-8, of Dawson Geophysical Company, of our report dated
November 3, 2003 with respect to the balance sheets of Dawson Geophysical
Company as of September 30, 2003 and 2002, and the related statements of
operations, stockholders' equity, and cash flows for each of the years in the
three-year period ended September 30, 2003 and all related financial statement
schedules, which report appears in the September 30, 2003 annual report on Form
10-K of Dawson Geophysical Company.
Midland, Texas
March 9, 2004