TABLE OF CONTENTS

DAWSON GEOPHYSICAL COMPANY

FORM 10‑K

For the financial statements, other financial information and the business information set forth herein generally speak only as to Legacy TGC and its pre-combination subsidiaries, including Eagle Canada, Inc., as of and for the three years endedYear Ended December 31, 2014, which period pre-dates the February 11, 2015 consummation of the strategic business combination between Legacy TGC and Legacy Dawson.  This Annual Report on Form 10-K does not include the financial results of pre-combination Legacy Dawson and its subsidiaries for such periods. Accordingly, except as otherwise specifically noted herein, references herein to “Legacy TGC,” the “Company,” “we,” “us,” or “our”  refer only to Legacy TGC and its pre-combination subsidiaries and not to Legacy Dawson and its pre-combination subsidiaries.2016

DISCLOSURE REGARDING FORWARD‑LOOKING STATEMENTS

Beginning with the Quarterly Report on Form 10-Q for the quarter ending March 31, 2015, post-combination Dawson Geophysical Company will report on a consolidated basis representing the combined operations of Legacy TGC and Legacy Dawson and their respective subsidiaries.  The quarter ending March 31, 2015 will be the first quarterly reporting period following the combination of Legacy TGC and Legacy Dawson, which was consummated on February 11, 2015.  Because Legacy Dawson was deemed the accounting acquirer under accounting principles generally accepted in the United States, the historical financialStatements other than statements of Legacy Dawson will be treated as the historical financial statements of the combined company and will be reflected in post-combination Dawson Geophysical Company’s future quarterly and annual reports.

In addition, supplemental information concerning the business and properties of post-combination Dawson Geophysical Company (representing the combined operations of Legacy TGC and Legacy Dawson and their respective subsidiaries) will befact included in itsthis Form 8-K/A10‑K that relate to forecasts, estimates or other expectations regarding future events, including without limitation, statements under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business” regarding technological advancements and our financial position, business strategy, and plans and objectives of our management for future operations, may be deemed to be filed on or before April 30, 2015.

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Part I

Item 1.  BUSINESS

ITEM 1. BUSINESS.General

Completion of Acquisition

On February 11, 2015, pursuant to the previously announced Agreement and Plan of Merger, dated October 8, 2014 (the “Merger Agreement”), by and among the Company, Legacy Dawson and Merger Sub, Merger Sub was merged with and into Legacy Dawson, with Legacy Dawson continuing after the merger as the surviving entity and a wholly-owned subsidiary of the Company (the “Merger”). At the effective time of the Merger, without any action on the part of any shareholder, each issued and outstanding share of Legacy Dawson’s common stock, par value $0.331/3 per share (the “Legacy Dawson Common Stock”), including shares underlying Legacy Dawson’s outstanding equity awards, was converted into the right to receive 1.760 shares of common stock of the Company, par value $0.01 per share (the “Company Common Stock”), after giving effect to a 1-for-3 reverse stock split of the issued and outstanding Company Common Stock which occurred immediately prior to the Merger (the “Reverse Stock Split”). In connection with the Merger, Legacy Dawson changed its name to “Dawson Operating Company” and the Company changed its name to “Dawson Geophysical Company.” All shares and per share amounts in this Form 10-K have been retrospectively adjusted to give effect to the Reverse Stock Split.

General

At December 31, 2014 and prior to the Merger, our Company, a Texas corporation (the “Company”), is a leading provider of North America onshore seismic data acquisition services with operations throughout the continental United States (“U.S.”) and Canada. We acquire and process 2‑D, 3‑D and multi‑component seismic data for our wholly-owned subsidiary, Eagle Canada, Inc., a Delaware corporation, were primarily engaged in the geophysical service business of conducting three-dimensional (“3-D”) surveys for clients, in theranging from major oil and gas business. Following the Merger, our Company’scompanies to independent oil and gas operators as well as providers of multi‑client data libraries. Our principal business office is located at 508 West Wall, Suite 800, Midland, Texas 79701 (Telephone: 432-684-3000)432‑684‑3000), and our internet address is www.dawson3d.com. We make available free of charge on our website our annual reports on Form 10-K,10‑K, quarterly reports on Form 10-Q,10‑Q, and current reports on Form 8-K8‑K as soon as reasonably practicable after filing or furnishing such information with the Securities and Exchange Commission.Commission (“SEC”).

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when processed and interpreted, produce precise images of the earth’s subsurface. Our clients then use our seismic data to generate 3‑D geologic models that help reduce drilling risks, finding and development costs and improve recovery rates from existing fields.

In addition to conventional 2‑D and 3‑D seismic surveys, we provide what the industry refers to as multi‑component seismic data surveys. Multi‑component surveys involve the recording of alternative seismic waves known as shear waves. Shear waves can be recorded as wave conversion of conventional energy sources (3‑C converted waves) or from horizontal vibrator energy source units (shear wave vibrators). Multi‑component data are utilized in further analysis of subsurface rock type, fabric and reservoir characterization. We own equipment required for onshore multi‑component surveys. The majority of the projects in Canada require multi‑component recording equipment. We have operated one to two multi‑component equipped crews in the U.S. routinely over the past few years. The use of multi‑component seismic data could increase in North America over the next few years if industry conditions improve and potentially require capital expenditures for additional equipment.

In recent years, we have begun providing surface‑recorded microseismic services utilizing equipment we currently own. Microseismic monitoring is used by clients who use hydraulic fracturing to extract hydrocarbon deposits to monitor their hydraulic fracturing operations. In addition, seismic data are sometimes utilized in unconventional reservoirs to identify geo-hazards (such as subsurface faults) for drilling purposes, aid in geo-steering of a horizontal well bore and rock property identification for high grading of well locations and hydraulic fracturing. The majority of our current activity is in areas of unconventional reservoirs.

We market and supplement our services in the continental U.S. from our headquarters in Midland, Texas and from additional offices in three other cities in Texas (Denison, Houston and Plano) as well as two additional states, Oklahoma (Oklahoma City) and Colorado (Denver). In addition, we market and supplement our services in Canada from our facilities in Calgary, Alberta.

The Industry

Technological advances in seismic equipment and computing allow the seismic industry to acquire and process, on a cost‑effective basis, immense volumes of seismic data which produce precise images of the earth’s subsurface. The latest accepted method of seismic data acquisition, processing, and the subsequent interpretation of the processed data is the 3‑D seismic method. Geophysicists use computer workstations to interpret 3‑D data volumes, identify subsurface anomalies, and generate a geologic model of subsurface features. In contrast with the 3‑D method, the 2‑D method involves the collection of seismic data in a linear fashion, thus generating a single plane of subsurface seismic data.

3‑D seismic data are used in the exploration and development of new reserves and enable oil and natural gas companies to better delineate existing fields and to augment their reservoir management techniques. Benefits of incorporating high resolution 3‑D seismic surveys into exploration and development programs include reducing drilling risk, decreasing oil and natural gas finding costs, and increasing the efficiencies of reservoir location, delineation, and management. In order to meet the requirements necessary to fully realize the benefits of 3‑D seismic data, there is an increasing demand for improved data quality with greater subsurface resolution.

Currently, the North American seismic data acquisition industry is made up of a number of companies divided into two groups. The first group is made up of publicly‑traded companies which includes us and SAExploration Holdings, Inc. (“SAE”). The second group is made up of Echo Seismic Ltd. (“ECHO”), Geokinetics, Inc. (“Geokinetics”), Breckenridge Geophysical Inc. (“Breckenridge”), and Paragon Geophysical Services, Inc. (“Paragon”), along with smaller companies which generally run one or two seismic crews and often specialize in specific regions or types of operations.

Equipment and Crews

In recent years, we have experienced continued increases in recording channel capacity on a per crew or project basis. This increase in channel count demand is driven by client needs and is necessary in order to produce higher resolution images, increase crew efficiencies and undertake larger scale projects. Due to the increase in demand for higher channel counts, we have continued our investments in additional channels. In response to project‑based channel requirements, we routinely deploy a variable number of channels on a variable number of crews in an effort to maximize asset utilization and meet client needs. While the number of recording systems we own may exceed the number utilized in the field at any given time, we maintain the excess equipment to provide additional operational flexibility and to allow us to quickly

deploy additional recording channels and energy source units as needed to respond to client demand and desire for improved data quality with greater subsurface images. We believe we will realize the benefit of increased channel counts and flexibility of deployment through increased crew efficiencies, higher revenues and margins with improved conditions.

Since 2011, we have purchased or leased a significant number of cable‑less recording channels. We have utilized this equipment primarily as stand‑alone recording systems, but on occasion we have utilized it in conjunction with our cable‑based systems. As a result of the introduction of cable‑less recording systems, we have realized increased crew efficiencies and increased revenue on projects using this equipment. We believe we will experience continued demand for cable‑less recording systems in the future. While we have replaced cable‑based recording equipment with cable‑less equipment on certain crews, the cable‑based recording equipment continues to be deployed on existing crews.

As of December 31, 2016, we owned equipment for 16 land-based22 land‑based seismic data acquisition crews, 201 vibrator energy source units, approximately 260,000 recording channels and 73 vibration vehicles.22 central recording systems. Of the 22 recording systems we owned at December 31, 2016, 12 were Geospace Technologies GSR and GSX cable‑less recording systems, eight were ARAM ARIES cable‑based recording systems, one was a Wireless Seismic RT System 2 system, and one was a cable‑less INOVA Hawk system. Each crew consists of approximately 40 to 80100 technicians with associated vehicles, geophones, a seismic recording system, energy sources, cables, and a variety of other equipment. Each ARAM crew has one central recording vehicle which captures seismic data. The GSR, GSX and INOVA Hawk crews utilize a recorder to manage the data acquisition while the individual system captures and holds the data until they are placed in the Data Transfer Module. The data is then transferred to a CD-ROM orvarious data tapestorage media, which isare delivered to a data processing center selected by the customer.client.

In addition to the Legacy TGC equipment referenced above, as of December 31, 2014, Legacy Dawson owned approximately 157 vibrator energy source units, approximately 179,000 recording channelsEquipment Acquisition and sixteen central recording systems. Of the sixteen recording systems Legacy Dawson owned at December 31, 2014, seven were Geospace Technologies GSR cable-less recording systems, eight were ARAM ARIES cable-based recording systems, and one was a Wireless Seismic RT System 2 system.  During the quarter ended December 31, 2014, Legacy Dawson operated eight to ten data acquisition crews.  Each crew consisted of approximately forty to one hundred technicians, twenty-five or more vehicles with off-road capabilities, up to 100,000 geophones, a seismic recording system, energy sources, electronic cables and a variety of other equipment.

Capital Expenditures

We believe that it is essential to take advantage ofmonitor and evaluate advances in seismicgeophysical technology and to commit capital funds to purchase and updatethe equipment we deem most effective to maintain our equipment cost-effectively.competitive position. Purchasing and updating seismic equipment and technology involves a commitment to capital spending. We also tie our capital expenditures closely to demand for our services. As a result due toof the continuing softening in demand for seismic services beginning in early in 2013,2014 and the Company’s belief that its current equipment base is sufficient to meet current demand, the Company has adopted a maintenance capital expenditures program curtailingand has generally curtailed large equipment purchases for the duration of 2013 and, with the exception of the INOVA Hawk seismic data acquisition system purchase disclosed earlier, continuing through 2014. During the year ended December 31, 2014, we made capital expenditures of approximately $7,955,000, which includes the INOVA Hawk system purchase and maintenance of existing equipment.  During the year ended December 31, 2013, we made capital expenditures of approximately $2,475,000, primarily to maintain existing equipment.  During the year ended December 31, 2012, capital expenditures of approximately $57,108,000 were used to acquire, maintain, and replace seismic equipment and vehicles. Major purchases in 2012 included our fourth GSR System with 7,200 channels, our fifth GSR System with 7,000 channels, our sixth GSR System with 13,000 channels, some of which were added to existing systems, an 8,000 station 3-channel GSX wireless recording system, and seven new INOVA vibration vehicles.  These major investments should continue to bring us the benefits of these new technologies.purchases.

Clients

Customers

Our customers are major and independent oil and natural gas exploration and development companies. The services we provide to our customers vary according to the size and needs of each customer.  Our services are marketed by supervisory and executive personnel who contact customersclients to determine theirgeophysical needs and respond to customerclient inquiries regarding the availability of crews. Contactscrews or processing schedules. These contacts are based principally upon professional relationships developed over a number of years.

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Long-livedLong lived assets as of December 31, 20142016 were approximately $48,792,000,$324,950,000, with $18,621,000 located$308,418,000 owned in the United StatesU.S. and $30,171,000 located$16,532,000 owned in Canada. Long-livedLong lived assets as of December 31, 20132015 were approximately $63,107,000,$345,619,000, with $20,148,000 located$329,467,000 owned in the United StatesU.S. and $42,959,000 located in Canada.  Long-lived assets as of December 31, 2012 were approximately $89,386,000, with $32,390,000 located in the United States and $56,996,000 located$16,152,000 owned in Canada.

Contracts

Our contracts are obtained either through competitive bidding or as a result of customerclient negotiations. Our services are conducted under general service agreements for seismic data acquisition services which define certain obligations for us and for our customers.clients. A supplemental agreement setting forth the terms of a specific project, which may be canceled by either party upon 30 days’ advance writtenon short notice, is entered into for every project. We currently operate under supplemental agreements that are either “turnkey” agreements providing for a fixed fee to be paid to us for each unit of data acquired or “term” agreements providing for a fixed hourly, daily, or monthly fee during the term of the project or projects.

Currently, as in recent years, most of our projects are operated under turnkey agreements. Turnkey agreements generally provide us more profit potential, but involve more risks because of the potential of crew downtime or operational delays. We attempt to negotiate on a project‑by‑project basis some level of weather downtime protection within the turnkey agreements. Under the term agreements, we forego an increased profit potential in exchange for a more consistent revenue stream with improved protection from crew downtime or operational delays.

Competition

The acquisition of seismic data for the oil and natural gas industry is a highly competitive business. Contracts for such services generally are awarded on the basis of price quotations, crew experience, and the availability of crews to perform in a timely manner, although factors other than price, such as crew safety, performance history, and technological and operational expertise, are often determinative. Our competition includes publicly traded competitors, such as CGG (which recently sold its North American onshore seismic contract acquisition business to Geokinetics) and SAE. Our other major competitors include Echo, Geokinetics, Global Geophysical, Tesla, Breckenridge, Paragon and LoneStar.Paragon. In addition to these previously named companies, we also compete for projects from time to time with smaller seismic companies which operate in local markets with only one or two crews. Further, the barriers to entry in the seismic industry are not prohibitive, and it would not be difficult for seismic companies outside of the U.S. to enter the domestic market and compete with us.

Employees

As of December 31, 2014,2016, we employed a total of 745 full-time814 full‑time employees, of which 39approximately 97 consisted of management, sales, and administrative personnel with the remainder being crew and crew support personnel. Our employees are not represented by a labor union. We believe our relationshipwe have good relations with our employees to be satisfactory.employees.

Operating Risks and Insurance

Our business is subject to the hazards inherent in conducting seismic data acquisition activities in hostile environments with dangerous machinery, and in some instances explosives. These activities can cause personal injury or loss of life, damage to or destruction of property, equipment, the environment, and marine life, and suspension of operations.

In addition, we could be subject to personal injury or real property damage claims in the normal operationSee “Item 2. Properties” for a description of our business. Such claims may not be covered by the indemnification provisionsmaterial properties utilized in our general service agreements to the extent that the damage is due to our negligence or intentional misconduct.business.

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of operations in the past as well as currently and will continue to do so if the level of such exploration activities and the prices for oil and natural gas were to decline in the future or if the downturn that we appear to be emerging from is extended or becomes more severe. In addition to the market prices of oil and natural gas, the willingness of our clients to explore, develop and produce depends largely upon prevailing industry conditions that are influenced by numerous factors over which our management has no control, including general economic conditions and the availability of credit. Any prolonged reduction in the overall level of exploration and development activities, whether resulting from changes in oil and natural gas prices or otherwise, could adversely impact us in many ways by negatively affecting:

Worldwide political, economic, and military events have contributed to oil and natural gas price volatility and are likely to continue to do achieve profitability,so in the future. Depending on the market prices of oil and natural gas, oil and natural gas exploration and development companies may cancel or curtail their capital expenditure and drilling programs, thereby reducing demand for our services, or may become unable to pay, or have to delay payment of, amounts owed to us for our services. Oil and natural gas prices have been highly volatile historically and, we believe, will continue to be so in the future. Many factors beyond our control affect oil and natural gas prices, including:

We, and our clients, may be adversely affected by an economic downturn.

An economic downturn could have a material adverse effect on our financial results and proposed plan of operations and could lead to further significant fluctuations in the demand for and pricing of oil and gas. Reduced demand and pricing pressures could adversely affect the financial condition and results of operations of our clients and their ability to purchase our services. We are not able to predict the timing, extent, and duration of the economic cycles in the markets in which we operate. The oil and natural gas industry appears to be emerging from a severe downturn and prices for oil and natural gas have recently stabilized after the decline that began in the fourth quarter of 2014. If the downturn that we appear to be emerging from continues for an extended period of time, or if it becomes more extreme, it may have material adverse effects on our planned operations, level of capital expenditures and financial condition.

A limited number of clients operating in a single industry account for a significant portion of our revenues, and the loss of one of these clients could adversely affect our results of operations.

We derive a significant amount of our revenues from a relatively small number of oil and gas exploration and development companies and providers of multi‑client data libraries. During the twelve months ended December 31, 2016, our largest client accounted for approximately 13% of our revenues. If this client, or any of our other significant clients, were to terminate their contracts or fail to contract for our services in the future because they are acquired, alter their exploration or development strategy, experience financial difficulties or for any other reason, our results of operations could be adversely affected.

Our clients could delay, reduce or cancel their service contracts with us on short notice, which may lead to lower than expected demand and revenues.

Our order book reflects client commitments at levels we believe are sufficient to maintain operations on our existing crews for the indicated periods. However, our clients can delay, reduce or cancel their service contracts with us on short notice. If the current downturn in the oil and natural gas industry that we appear to be emerging from continues for an extended period of time, or if it becomes more extreme, it may result in an increase in delays, reductions or cancellations by our clients. In addition, the timing of the origination and completion of projects and when projects are awarded and contracted for is also uncertain. As a result, our order book as of any particular date may not be able to sustain or increase profitability on a quarterly or annual basis.indicative of actual demand and revenues for any succeeding period.

Our revenues, and operating results and cash flows can be expected to fluctuate from period to period.

Our revenues, operating results and profitabilitycash flows may fluctuate from period to period. These fluctuations are attributable to the level of new business in a particular period, the timing of the initiation, progress or cancellation of significant projects, higher revenues and expenses on our dynamite contracts, and costs we incur to train new crews we may add in the future to meet increased customerclient demand. Fluctuations in our operating results may also be affected by other factors that are outside of our control such as permit delays, weather delays and crew productivity. Oil and natural gas prices have continued to be volatile during the year ended December 31, 2014, and have resulted in significant demand fluctuations for our services. The current downturn in the oil and natural gas industry that we appear to be emerging from and the related sustained declines in oil and natural gas commodity prices have resulted in declines in the demand for our services. There can be no assurance of future oil and gas price levels or stability. Our operations in Canada are also seasonal as a result of the thawing season and we have historically experienced limited Canadian activity forduring the second and third calendar quarters of each year. The demand for our services will be adversely affected by a significant reduction in oil and natural gas prices and by climate change legislation or material changes to U.S. energy policy. Because our business has high fixed costs, the negative effect of one or more of these factors could trigger wide variations in our operating revenues, cash flows, EBITDA, margin, and profitability from quarter-to-quarter, which these factors render quarter-to-quarterquarter‑to‑quarter, rendering quarter‑to‑quarter comparisons unreliable as an indicator of performance. Due to the factors discussed above, you should not expect sequential growth in our quarterly revenues and profitability.

We extend credit to our clients without requiring collateral, and a default by a client could have a material adverse effect on our operating revenues.

We face intense competitionperform ongoing credit evaluations of our clients’ financial conditions and, generally, require no collateral from our clients. It is possible that one or more of our clients will become financially distressed, especially in our business from companies with greater financial resources.light of the recent downturn in the oil and natural gas industry and low commodity prices, which could cause them to default on their obligations to us and could reduce the client’s future need for seismic services provided by us. Our concentration of clients

may also increase our overall exposure to these credit risks. A default in payment from one of our large clients could have a material adverse effect on our operating revenues for the period involved.

We incur losses.

We incurred net losses of $39,792,000 and $26,279,000 for the twelve months ended December 31, 2016 and 2015, respectively.

Our ability to be profitable in the future will depend on many factors beyond our control, but primarily on the level of demand for land‑based seismic data acquisition services industryby oil and natural gas exploration and development companies. Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.

We have indebtedness under credit facilities with a commercial bank, and certain of our core assets and our accounts receivable are pledged as collateral for these obligations. Our ability to borrow may be limited if our accounts receivable decrease or the value of certain of our core assets is materially impaired.

We have indebtedness under credit facilities with a highly competitive business in the continental U.S.commercial bank, and Canada.  Our competitors include companies with financial resources that are significantly greater thancertain of our owncore assets as well as companiesour accounts receivable are pledged as collateral for these borrowings. If we are unable to repay all secured borrowings when due, whether at maturity or if declared due and payable following a default, our lenders have the right to proceed against the assets pledged to secure the indebtedness and may sell these assets in order to repay those borrowings, which could materially harm our business, financial condition and results of operations. Our ability to borrow funds under our revolving line of credit is tied to the value of pledged assets as well as the amount of our eligible accounts receivable. If our pledged assets become materially impaired or our accounts receivable decrease materially for any reason, including delays, reductions or cancellations by clients or decreased demand for our services, our ability to borrow to fund operations or other obligations may be limited.

Our financial results could be adversely affected by asset impairments.

We periodically review our portfolio of equipment and our intangible assets for impairment. In connection with the Merger, we recorded intangibles associated with the combination of Legacy TGC and Legacy Dawson that are an asset on our consolidated balance sheet. Future events, including our financial performance, sustained decreases in oil and natural gas prices, reduced demand for our services, our market valuation or the market valuation of comparable companies, loss of a significant client’s business, or strategic decisions, could cause us to conclude that impairment indicators exist and smaller size. In addition,ultimately that the barriersasset values associated with our equipment or our intangibles were to entrybe impaired. If we were to impair our equipment or intangibles, these noncash asset impairments could negatively affect our financial results in a material manner in the seismic industryperiod in which they are not prohibitive,recorded, and it would notthe larger the amount of any impairment that may be difficult for seismic companies outside oftaken, the U.S. to entergreater the U.S. market and compete with us.

Our clients could delay, reduce or cancel their service contracts with us on short notice, whichimpact such impairment may lead to lower than expected demand and revenues.

Our order book reflects client commitments at levels we believe are sufficient to maintain operationshave on our existing crews for the indicated periods. However, our clients can delay, reduce or cancel their service contracts with us on short notice. In addition, the timing of the origination and completion of projects and when projects are awarded and contracted for is also uncertain. As a result, our order book as of any particular date may not be indicative of actual demand and revenues for any succeeding fiscal period.financial results.

Our profitability is determined, in part, by the utilization level and productivity of our crews and is affected by numerous external factors that are beyond our control.

Our revenue is determined, in part, by the contract price we receive for our services, the level of utilization of our data acquisition crews and the productivity of these crews. Crew utilization and productivity is partly a function of external factors, such as client cancellation or delay of projects, or operating delays from inclement weather, obtaining land access rights and other factors, over which we have no control. If our crews encounter operational difficulties or delays on any data acquisition survey, our results of operations may vary, and in some cases, may be adversely affected.

In recent years, most of our projects have been performed on a turnkey basis for which we were paid a fixed price for a defined scope of work or unit of data acquired. The revenue, cost and gross profit realized under our turnkey contracts can vary from our estimates because of changes in job conditions, variations in labor and equipment productivity or because of the performance of our subcontractors. Turnkey contracts may also cause us to bear substantially all of the risks of business interruption caused by external factors over which we may have no control, such as weather, obtaining land access rights, crew downtime or operational delays. These variations, delays and risks inherent in turnkey contracts may result in reducing our profitability.

We face intense competition in our business that could result in downward pricing pressure and the loss of market share.

The seismic data acquisition services industry is a highly competitive business in the continental U.S. and Canada. Our competitors include companies with financial resources that are greater than our own as well as companies of comparable and smaller size. Additionally, the seismic data acquisition business is extremely price competitive and has a history of periods in which seismic contractors bid jobs below cost and, therefore, adversely affected industry pricing. Many contracts are awarded on a bid basis, which may further increase competition based primarily on price. Further, the barriers to entry in the seismic industry are not prohibitive, and it would not be difficult for seismic companies outside of the U.S. to enter the domestic market and compete with us.

Inclement weather may adversely affect our ability to complete projects and could therefore adversely affect our results of operations.

Our seismic data acquisition operations could be adversely affected by inclement weather conditions. Delays associated with weather conditions could adversely affect our results of operations. For example, weather delays could affect our operations on a particular project or an entire region and could lengthen the time to complete data acquisition projects. In addition, even if we negotiate weather protection provisions in our contracts, we may not be fully compensated by our clients for delays caused by inclement weather.

Our operations are subject to Canadian foreign currency exchange rate risk.

We conduct business in Canadadelays related to obtaining land access rights of way from third parties which subjects us to foreign currency exchange rate risk.  Ourcould affect our results of operations.

Our seismic data acquisition operations and our cash flows could be impactedadversely affected by changesour inability to obtain timely right of way usage from both public and private land and/or mineral owners. We cannot begin surveys on property without obtaining permits from governmental entities as well as the permission of the private landowners who own the land being surveyed. In recent years, it has become more difficult, costly and time‑consuming to obtain access rights of way as drilling activities have expanded into more populated areas. Additionally, while landowners generally are cooperative in foreign currency exchange rates.granting access rights, some have become more resistant to seismic and drilling activities occurring on their property. In addition, governmental entities do not always grant permits within the time periods expected. Delays associated with obtaining such rights of way could negatively affect our results of operations.

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of our competitors may be able to purchase newer equipment when we may not be able to do so.so, thus affecting our ability to compete.

We rely on a limited number of key suppliers for specific seismic services and equipment.

We depend on a limited number of third parties to supply us with specific seismic services and equipment. From time to time, increased demand for seismic data acquisition services has decreased the available supply of new seismic equipment, resulting in extended delivery dates on orders of new equipment. Any delay in obtaining equipment could delay our deployment of additional crews and restrict the productivity of existing crews, adversely affecting our business and results of operation.operations. In addition, any adverse change in the terms of our suppliers’ arrangements could affect our results of operations.

Some of our suppliers may also be our competitors. If competitive pressures were to become such that our suppliers would no longer sell to us, we would not be able to easily replace the technology with equipment that communicates effectively with our existing technology, thereby impairing our ability to conduct our business.

Inclement weather may adversely affect our ability to complete projects and could therefore adversely affect our results of operations.

Our seismic data acquisition operations could be adversely affected by inclement weather conditions. Delays associated with weather conditions could adversely affect our results of operations. For example, weather delays could affect our operations on a particular project or an entire region and could lengthen the time to complete data acquisition projects. In addition, even if we negotiate weather protection provisions in our contracts, we may not be fully compensated by our clients for the delay caused by the inclement weather.

We are dependent on our management team and key employees, and the loss of any of theminability to retain our current team or attract new employees could harm our business.

We have limited management depth.Our continued success depends upon attracting and retaining highly skilled professionals and other technical personnel. A number of our employees are highly skilled scientists and highly trained technicians. The result of the loss, whether by death, departure or illness, of our President and Chief Executive Officersenior executives or other senior executives could have a material adverse effect on the ability of managementkey employees or our failure to continue operations at the same level of efficiency.

We extend credit to our customers without requiring collateral,attract and a default by a customerretain skilled and technically knowledgeable personnel could have a material adverse effect on our operating revenues.

We perform ongoing credit evaluations of our customers’ financial conditions and, generally, require no collateral from our customers. It is possible that one or more of our clients will become financially distressed, which could cause them to default on their obligations to us and could reduce the client’s future need for seismic services provided by us. Our concentration of clients may also increase our overall exposure to these credit risks. A default in payment from one of our large customers could have a material adverse effect on our operating revenues for the period involved.

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Our common stock has traded below $5.00 per share in the past year, and when it trades below $5.00 per share it may be considered a low‑priced stock and may be subject to regulations that limit or restrict the potential market valuationfor the stock.

Although currently our common stock is trading above $5.00 per share, our common stock may be considered a low-priced stock pursuant to rules promulgated under the Exchange Act, if it trades below a price of comparable companies, loss of$5.00 per share. Under these rules, broker-dealers participating in transactions in low-priced securities must first deliver a significantrisk disclosure document which describes the risks associated with such stock, the broker-dealer’s duties, the client’s business, failurerights and remedies, and certain market and other information, and make a suitability determination approving the client for low-priced stock transactions based on the client’s financial situation, investment experience and objectives. Broker-dealers must also disclose these restrictions in writing and provide monthly account statements to realize the benefitsclient, and obtain specific written consent of the Merger, or strategic decisions, could causeclient. With these restrictions, the likely effect of designation as a low-price stock would be to decrease the willingness of broker-dealers to make a market for our common stock, to decrease the liquidity of the stock and to increase the transaction costs of sales and purchases of such stocks compared to other securities. As of February 10, 2016, our common stock was quoted at a closing sales price of $2.93 per share and we cannot guarantee that our common stock will trade at a price greater than $5.00 per share.

We do not expect to pay cash dividends on our common stock for the foreseeable future, and, therefore, only appreciation of the price of our common stock may provide a return to shareholders.

While there are currently no restrictions prohibiting us from paying dividends to concludeour shareholders, our board of directors, after consideration of economic and market conditions affecting the energy industry in general, and the oilfield services business in particular, determined that impairment indicators existwe would not pay a dividend in respect of our common stock for the foreseeable future. Payment of any dividends in the future will be at the discretion of our board and that the asset values associated withwill depend on our equipment or our intangibles, if any, must be impaired. If we are forced to impair our equipment or intangibles these noncash asset impairments could negatively affect ourfinancial condition, results of operations, incapital and legal requirements, and other factors deemed relevant by the board.

Certain provisions of our amended and restated certificate of formation may make it difficult for a material mannerthird party to acquire us in the periodfuture or may adversely impact your ability to obtain a premium in which they are recorded,connection with a future change of control transaction.

Our amended and restated certificate of formation contains provisions that require the largerapproval of holders of 80% of our issued and outstanding shares before we may merge or consolidate with or into another corporation or entity or sell all or substantially all of our assets to another corporation or entity. Additionally, if we increase the amountsize of any impairment thatour board from the current eight directors to nine directors, we could, by resolution of the board of directors, stagger the directors’ terms, and our directors could not be removed without approval of holders of 80% of our issued and outstanding shares. These provisions could discourage or impede a tender offer, proxy contest or other similar transaction involving control of us.

In addition, our board of directors has the right to issue preferred stock upon such terms and conditions as it deems to be in our best interest. The terms of such preferred stock may be taken,adversely impact the greaterdividend and liquidation rights of our common shareholders without the impact such impairment would have onapproval of our results of operations.common shareholders.

We may be subject to liability claims that are not covered by our insurance.

Our business is subject to the general risks inherent in land-basedland‑based seismic data acquisition activities. Our activities are often conducted in remote areas under dangerous conditions, including the detonation of dynamite. These operations are subject to risksrisk of injury to personnel and damage to equipment. Our crews are mobile, and equipment and personnel are subject to vehicular accidents. These risks could cause us to experience equipment losses, injuries to our personnel, and interruptions in our business.

In addition, we could be subject to personal injury or real property damage claims in the normal operation of our business. Such claims may not be covered under the indemnification provisions contained in our general service agreements to the extent that the damage is due to our negligence or intentional misconduct.

WeOur general service agreements require us to have specific amounts of insurance. However, we do not carry insurance against certain risks that could cause losses, including business interruption resulting from equipment maintenance or weather delays. See “Item 1. Business — Operating Risks and Insurance”.

Our general service agreements require us to have specific amounts of insurance. ThereFurther, there can be no assurance, however, that any insurance obtained by us will be adequate to cover all losses or liabilities or that this insurance will continue to be available or available on terms which are

acceptable to us. Liabilities for which we are not insured, or which exceed the policy limits of our applicable insurance, could have a materially adverse effect on us.

We may be held liable for the actions of our subcontractors.

We often work as the general contractor on seismic data acquisition surveys and, consequently, engage a number of subcontractors to perform services and provide products. While we obtain contractual indemnification and insurance covering the acts of these subcontractors and require the subcontractors to obtain insurance for our benefit, we could be held liable for the actions of these subcontractors. In addition, subcontractors may cause injury to our personnel or damage to our property that is not fully covered by insurance.

We are subject to the requirements of Section 404 of the Sarbanes-Oxley Act. If we are unable to maintain compliance with Section 404, or if the costs related to maintaining compliance are significant, our profitability, stock price, and results of operations and financial condition could be materially adversely affected.

If we are unable to maintain adequate internal controls in accordance with Section 404, as such standards are amended, supplemented, or modified from time to time, we may not be able to ensure that we have effective internal controls over financial reporting on an ongoing basis in accordance with Section 404.  Failure to achieve and maintain effective internal controls could have a material adverse effect on our stock price.  In addition, a material weakness in the effectiveness of our internal control over financial reporting could result in an increased chance of fraud and the loss of customers, reduce our ability to obtain financing, and/or require additional expenditures to comply with these requirements, each of which could negatively impact our business, profitability, and financial condition.

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change legislation. Canadian operations have been historically cyclical due to governmental restrictions on seismic acquisition during certain periods. As a result, there is a risk that there will be a significant amount of unused equipment during those periods. We are required to expend financial and managerial resources to comply with such laws and related permit requirements in our operations, and we anticipate that we will continue to be required to do so in the future. Although such expenditures historically have not been material to us, the fact that such laws or regulations change frequently makes it impossible for us to predict the cost or impact of such laws and regulations on our future operations. The adoption of laws and regulations that have the effect of reducing or curtailing exploration and development activities by energy companies could also adversely affect our operations by reducing the demand for our services.

Current and future legislation or regulation relating to climate change or hydraulic fracturing could negatively affect the exploration and production of oil and gas and adversely affect demand for our services.

In response to concerns suggesting that emissions of certain gases, commonly referred to as “greenhouse gases” (GHG)(“GHG”) (including carbon dioxide and methane), may be contributing to global climate change, legislative and regulatory measures to address the concerns are in various phases of discussion or implementation at the national and state levels. At least one-halfone‑half of the states, either individually or through multi-statemulti‑state regional initiatives, have already taken legal measures intended to reduce GHG emissions, primarily through the planned development of GHG emission inventories and/or GHG cap and trade programs. Although various climate change legislative measures have been under consideration by the U.S. Congress, it is not possible at this time to predict whether or when Congress may act on climate change legislation. The U.S. Environmental Protection Agency (the “EPA”) has promulgated a series of rulemakings and taken other actions that the EPA states will result in the regulation of GHG as “air pollutants” under the existing federal Clean Air Act. Furthermore, in 2010, EPA regulations became effective that require monitoring and reporting of GHG emissions on an annual basis, including extensive GHG monitoring and reporting requirements. While this new rule does not control GHG emission levels from any facilities, it will cause covered facilities to incur monitoring and reporting costs. Moreover, lawsuits have been filed seeking to require individual companies to reduce GHG emissions from their operations. These and other lawsuits relating to GHG emissions may result in decisions by state and federal courts and agencies that could impact our operations.

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Representatives has commenced its own investigation into hydraulic fracturing practices. The EPA issued a final report in December 2016, concluding that hydraulic fracturing activities have the potential to impact drinking water resources, particularly when involving water withdrawals, spills, fracturing into wells with inadequate mechanical integrity, fracturing directly into such resources, underground migration of liquids and gases, and inadequate treatment, disposal, storage and discharge of wastewater. The final report also listed the data gaps and uncertainties that limited the EPA’s ability to fully assess the potential impacts of hydraulic fracturing on drinking water resources.

These legislative and regulatory initiatives imposing additional reporting obligations on, or otherwise limiting, the hydraulic fracturing process could make it more difficult or costly to complete natural gas wells. Shale gas cannot be economically produced without extensive fracturing. In the event such legislation is enacted, demand for our seismic acquisition services may be adversely affected.

Risks Related To Our Common Stock

Our common stock has experienced, and may continueWe are subject to experience, price volatility and low trading volume.

Ourthe requirements of Section 404 of the Sarbanes‑Oxley Act. If we are unable to maintain compliance with Section 404, or if the costs related to maintaining compliance are significant, our profitability, stock price, is subjectresults of operations and financial condition could be materially adversely affected.

If we are unable to significant volatility. Overall market conditions, includingmaintain adequate internal controls in accordance with Section 404, as such standards are amended, supplemented, or modified from time to time, we may not be able to ensure that we have effective internal controls over financial reporting on an ongoing basis in accordance with Section 404. Failure to achieve and maintain effective internal controls could have a declinematerial adverse effect on our stock price. In addition, a material weakness in oil and natural gas prices and other risks and uncertainties described in this “Risk Factors” section and elsewhere in this Form 10-K, could cause the market priceeffectiveness of our common stock to fall. The high and low sales pricesinternal control over financial reporting could result in an increased chance of our common stock for the year ended December 31, 2014, were $22.35 and $5.79, respectively, as adjusted for our 1-for-3 Reverse Stock Split on February 11, 2015.

Our common stock is listed on the Nasdaq Global Select Market under the symbol “DWSN.” However, daily trading volumes for our common stock are, and may continue to be, relatively small compared to many other publicly traded securities.  For example, during 2014 our daily trading volume was as low as 2,266 shares, as adjusted for our 1-for-3 Reverse Stock Split on February 11, 2015.  It may be difficult for you to sell your shares in the public market at any given time at prevailing prices,fraud and the priceloss of clients, reduce our common stock may, therefore, be volatile.

Certain provisions of our amended and restated certificate of formation may make it difficult for a third party to acquire us in the future or may adversely impact your ability to obtain a premium in connectionfinancing, and/or require additional expenditures to comply with a future changethese requirements, each of control transaction.

Our amended restated certificate of formation, as amended, contains provisions that require the approval of holders of 80% ofwhich could negatively impact our issuedbusiness, profitability and outstanding shares before we may merge or consolidate with or into another corporation or entity or sell all or substantially all of our assets to another corporation or entity. Additionally, if we increase the size of our board from the current eight directors to nine directors, we could by resolution of the board of directors stagger the directors’ terms, and our directors could not be removed without approval of holders of 80% of our issued and outstanding shares. These provisions could discourage or impede a tender offer, proxy contest or other similar transaction involving control of us.

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For a discussion of certain contingencies affecting the Company, please refer to us.Note 16, “Commitments and Contingencies”, to the Consolidated Financial Statements incorporated by reference herein.

ITEMItem 4.  MINE SAFETY DISCLOSURES.

None.

15DISCLOSURES

Equity Compensation Plan Information

PERFORMANCE GRAPH

The following graph sets forth the five-yearbelow matches Dawson Geophysical Company’s cumulative five year total shareholder return which assumes reinvestmenton common stock with the cumulative total returns of dividends,the S&P 500 index and the PHLX Oil Service Sector index. The graph tracks the performance of a $100 investment beginning in our common stock a peer group made upand in each index (with the reinvestment of companiesall dividends) from December 31, 2011 to December 31, 2016.

The stock prices used in the Philadelphiacomputation of the graph below reflect those of Legacy TGC from December 31, 2010 to December 31, 2014 multiplied by three to account for the 1‑for‑3 reverse stock split undertaken by Legacy TGC in connection with the Merger. The stock price at December 31, 2015 and 2016 reflects that of the combined Company following the Merger, as reported on NASDAQ under the symbol “DWSN”.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

Among Dawson Geophysical Company, the S&P 500 Index

and the PHLX Oil Service Sector Index and the S&P 500 Stock Index. 

*$100 invested on December 31, 2011 in stock or index, including reinvestment of dividends.

Year ended December 31.

The Philadelphia Oil Service Sector Index consistsstock price performance included in this graph is not necessarily indicative of far larger companies that provide a variety of services as compared to the land-based geophysical services provided by the Company.future stock price performance.