ION announces commencement of Rights Offering
March 23 2021 - 6:45AM
ION Geophysical Corporation (NYSE: IO) (the “Company”) today
announced that it has commenced its previously announced Rights
Offering. The Company is distributing, at no charge, to its holders
of common stock, par value $0.01 per share (the “Common Stock”) as
of 5:00 p.m. New York City time on March 22, 2021 (the “Record
Date”), non-transferable subscription rights (the “Rights”) to
purchase (i) $2.78 principal amount of the 8.00% Senior Secured
Second Priority Convertible Notes due 2025 (the “Notes”) per Right,
at a purchase price of 100% of the principal amount thereof or (ii)
1.08 shares of Common Stock per Right, at a purchase price of $2.57
per whole share of Common Stock; provided that any Notes will only
be issued in minimum increments of $1,000 and will be rounded down
to the nearest whole increment of $1,000 and any shares of Common
Stock will only be issued in whole numbers of shares with any
fractional shares of Common Stock rounded down to the nearest whole
share. Each holder of Common Stock will receive one Right for each
share of Common Stock owned as of the Record Date. The maximum
amount of net proceeds that the Company may receive from the Rights
Offering is $50 million, before deducting certain fees and expenses
of the offering. The Rights Offering is intended to generate
proceeds to make certain payments to holders of its 9.125% Senior
Secured Second Priority Notes due 2021 (the “Existing Second Lien
Notes”) in the Company’s previously announced Exchange Offer and
for general corporate purposes. The Rights Offering will terminate,
as to unexercised rights, at 5:00 p.m. New York City time on April
8, 2021, unless the Company elects to extend the Rights Offering.
Holders who subscribe for all of their basic subscription rights
can also elect to subscribe for additional shares pursuant to an
over-subscription privilege.
In connection with the Rights Offering, as of
March 23, 2021, the Company has entered into backstop agreements
(the “Backstop Agreements”) with several holders of Common Stock
(the “Backstop Providers”) pursuant to which the Backstop Providers
have agreed, in the aggregate, to purchase approximately $40.1
million of Notes at par or shares of Common Stock at $2.57 per
share pursuant to the over-subscription privilege (the “Backstop
Commitment”). If holders of Common Stock, including the Backstop
Providers, subscribe for more than $50 million, in the aggregate,
of Notes and Common Stock, then the Notes and Common Stock actually
delivered to each subscriber, will be decreased, pro rata, to give
effect to the $50 million limit on proceeds noted in the preceding
paragraph. The Backstop Agreements are subject to other customary
terms and conditions, including payment, in principal amount of
Notes or shares of Common Stock at $2.57 per share, of a backstop
fee in an amount up to five percent (5%) of the Backstop
Commitment. To complete the Rights Offering, the Company must
receive net proceeds of at least $20 million from the Rights
Offering. The current Backstop Commitment will allow the Company to
satisfy this condition.
Beneficial owners of Common Stock who desire to
participate and acquire Notes or Common Stock in the Rights
Offering should contact their brokers, dealers or other nominee
holders of their Common Stock.
The description above includes only a summary of
certain key terms of the Rights Offering. The complete terms and
conditions of the Rights Offering are contained in a registration
statement on Form S-1, including the prospectus, respecting the
Rights Offering filed by the Company with the U.S. Securities and
Exchange Commission (“SEC”) that became effective on March 10,
2021.
A copy of the prospectus relating to the Rights
Offering along with additional materials related to the Rights
Offering will be mailed to the Company’s stockholders as of the
Record Date as soon as practicable on or about March 23, 2021.
Stockholders may also obtain a copy of the prospectus free of
charge on the SEC website at www.sec.gov or by contacting the
information agent for the Rights Offering, D.F. King & Co.,
Inc., at 1 (877) 732-3617 or ion@dfking.com.
Oppenheimer & Co. Inc. is acting as the sole
Dealer Manager for the Rights Offering.
This press release is for informational purposes
only and is not an offer to purchase or to sell or a solicitation
of an offer to purchase or sell any securities, nor shall there be
any offer, solicitation or sale of any securities in any
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction.
About ION
Leveraging innovative technologies, ION delivers
powerful data-driven decision-making to offshore energy and
maritime operations markets, enabling clients to optimize
investments and results through access to our data, software and
distinctive analytics. Learn more at iongeo.com.
Contacts
ION (Investor relations)
Executive Vice President and Chief Financial
OfficerMike Morrison, +1 281.879.3615 mike.morrison@iongeo.com
ION (Media relations)
Vice President, CommunicationsRachel White, +1
281.781.1168rachel.white@iongeo.com
The information herein contains certain
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. These forward-looking
statements may include information and other statements that are
not of historical fact. Actual results may vary materially from
those described in these forward-looking statements. All
forward-looking statements reflect numerous assumptions and involve
a number of risks and uncertainties. These risks and uncertainties
include the risks associated with the timing and development of ION
Geophysical Corporation's products and services; pricing pressure;
decreased demand; changes in oil prices; agreements made or adhered
to by members of OPEC and other oil producing countries to maintain
production levels; the COVID-19 pandemic; the Company’s ability to
complete the Restructuring Transactions and other related matters
in a timely manner, if at all; and political, execution,
regulatory, and currency risks. For additional information
regarding these various risks and uncertainties, see the Company’s
Form 10-K for the year ended December 31, 2020, filed on February
12, 2021, and the Company’s Form S-1 and Form S-4, each filed on
January 29, 2021, and amended on February 12, 2021 and March 3,
2021. Additional risk factors, which could affect actual results,
are disclosed by the Company in its filings with the SEC, including
its Form 10-K, Form 10-Qs and Form 8-Ks filed during the year. The
Company expressly disclaims any obligation to revise or update any
forward-looking statements.
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