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Subsequent Events
3 Months Ended
Dec. 31, 2014
Subsequent Events

10. SUBSEQUENT EVENTS

On January 7, 2015, Andrew Speese, through his attorney, filed a purported shareholder class action and derivative action relating to the Merger on behalf of himself and Legacy Dawson’s other shareholders in the United States District Court for the Western District of Texas (Midland/Odessa Division), against Legacy Dawson, Legacy Dawson’s directors prior to the Merger, Legacy TGC and Merger Sub. The lawsuit alleges, among other things, that the members of Legacy Dawson’s Board of Directors at the time the action was initiated (the “Legacy Dawson Board”) breached their fiduciary duties in connection with the strategic business combination with Legacy TGC, and that Legacy Dawson’s registration statement dated November 6, 2014, as subsequently amended, and prospectus filed on December 31, 2014 contain material omissions and materially misleading statements. The complaint sought to enjoin Legacy Dawson, Legacy TGC and Merger Sub from taking any actions that would allow the consummation of the proposed strategic business combination contemplated by the merger agreement or, now that the strategic business combination has been consummated, a judgment for damages.

 

In addition, on January 8, 2015, Legacy Dawson received a letter dated January 7, 2015 from legal counsel for Andrew Speese with respect to the lawsuit described above demanding that the Legacy Dawson Board take legal action to remedy alleged breaches of fiduciary duties in connection with the strategic business combination and to recover damages caused by such alleged breaches. This demand letter was in addition to the letter dated December 18, 2014 that Legacy Dawson received on December 22, 2014 from legal counsel for another purported shareholder demanding that the Legacy Dawson Board take appropriate legal action against the members of the Legacy Dawson Board (the “December Demand Letter”). The December Demand Letter alleges conflicts of interest on the part of certain of Legacy Dawson officers and directors in connection with the Merger, disclosure deficiencies by Legacy Dawson with respect to the Merger and the negotiations leading to the merger agreement and breaches of fiduciary duties by such persons in connection with such matters. The December Demand Letter also demanded that Legacy Dawson make various corrective disclosures concerning the Merger.

The Legacy Dawson Board formed a Special Litigation Committee, which committee is authorized to retain independent legal counsel, to investigate the claims in the demand letters described above and to determine whether any of the derivative claims should be pursued. That committee is continuing to function following the consummation of the Merger.

On March 16, 2015, Andrew Speese, through his attorney, dismissed these claims without prejudice. Accordingly, only the December Demand Letter remains outstanding as of the filing of this report.

As discussed in Note 3 above, on February 11, 2015, Legacy Dawson completed the merger with Merger Sub, with Legacy Dawson continuing after the Merger as the surviving entity and a wholly-owned subsidiary of Legacy TGC.