UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 1.01. | Entry Into Material Definitive Agreements. |
Amendment to Credit Facility
On September 30, 2022, Dawson Geophysical Company (the “Company”) entered into a Third Loan Modification Agreement (the “Third Modification”) to the Loan and Security Agreement (as amended by (i) that certain Loan Modification Agreement dated as of September 30, 2020, (ii) that certain Second Loan Modification Agreement dated as of September 30, 2021, and (iii) the Third Modification, the “Loan Agreement”) for the purpose of (a) amending and extending the maturity of the Company’s line of credit with its lender, Dominion Bank, a Texas state bank (the “Lender”), by one year, (b) amending the principal amount under the Loan Agreement, (c) amending the interest rate under the Loan Agreement, (d) amending the Company’s obligation to maintain a certain tangible net worth and (e) adding the Company’s obligation to maintain a minimum liquidity amount. The Loan Agreement continues to provide for a secured revolving credit facility (the “Revolving Credit Facility”) in an amount up to the lesser of (I) $10,000,000 or (II) a sum equal to (A) 80% of the Company’s eligible accounts receivable plus (B) 100% of the amount on deposit with the Lender in the Company’s collateral account, including a certificate of deposit for $5,000,000. As of September 30, 2022, the Company has not borrowed any amounts under the Revolving Credit Facility.
The Revolving Credit Facility now matures on September 30, 2023, which date was extended in the Third Modification from a previous maturity of September 30, 2022. The Lender’s commitment under the Loan Agreement is now $10,000,000. The Company is now obligated under the Loan Agreement to maintain, as of the end of each calendar quarter, a tangible net worth of not less than $38,000,000. Additionally, the Company is now obligated under the Loan Agreement to maintain, to be tested as of the end of each calendar quarter, unencumbered liquid assets of not less than $5,000,000. The remaining terms and conditions of the Loan Agreement generally continue in the form existing prior to the Third Modification.
The foregoing description of the Third Modification is qualified in its entirety by reference to the full text of the Third Modification, which is filed as Exhibit 10.1 to this Current Report and is incorporated by reference herein.
| Item 2.03. | Creation of Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information provided in item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits. |
| EXHIBIT NUMBER |
DESCRIPTION | ||
| 10.1 | — | Third Loan Modification Agreement to Loan and Security Agreement, by and between Dawson Geophysical Company and Dominion Bank, dated September 30, 2022. | |
| 104 | — | Cover Page Interactive Data File, formatted in Inline XBRL, and included as Exhibit 101. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| DAWSON GEOPHYSICAL COMPANY | ||
| Date: October 4, 2022 | By: | /s/ James K. Brata |
| James K. Brata | ||
| Executive Vice President, Chief Financial Officer, Secretary and Treasurer | ||