ION announces revised record date for Rights Offering for new convertible Second Lien Notes or common stock
March 09 2021 - 5:17PM
ION Geophysical Corporation (NYSE: IO) announced today that it is
proceeding with steps to launch its previously announced rights
offering (“Rights Offering”) for its New Second Lien Convertible
Notes (“New Notes”) or its Common Stock, as part of its
restructuring transactions (the “Restructuring Transactions”)
approved by shareholders on February 23, 2021. The Company has
filed a registration statement on Form S-1 with the Securities and
Exchange Commission (“SEC”). The Company expects to launch the
Rights Offering after the Registration Statement is declared
effective by the SEC.
The original record date of March 15, 2021 has
been rescheduled to March 22, 2021 (the “Record Date”). Each of our
shareholders as of the Record Date will receive one
non-transferable subscription right (“Right”) for each share of our
Common Stock they own. Each Right will entitle a holder to purchase
(i) a principal amount of our New Notes equal to $50,000,000
divided by the number of shares of our Common Stock outstanding as
of the Record Date, at a purchase price of 100% of the principal
amount thereof or (ii) a number of shares of our Common Stock equal
to $50,000,000 divided by the purchase price of $2.57 per share
divided by the number of shares of our Common Stock outstanding as
of the Record Date, at a purchase price of $2.57 per whole share of
Common Stock; provided that any New Notes will only be issued in
minimum increments of $1,000 and any exercise of Rights therefore
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 our Common Stock rounded down
to the nearest whole share.
As of March 9, 2021, we had 17,960,434 shares of
Common Stock outstanding such that each Right would entitle a
holder to purchase (i) $2.78 principal amount of our New Notes or
(ii) 1.08 shares of our Common Stock. Each holder of a Right will
be entitled to an over-subscription privilege to purchase
additional securities that may remain unsubscribed as a result of
any unexercised rights. We expect to distribute the certificates
evidencing the Rights and other materials related to the Rights
Offering shortly after the Record Date.
In connection with the Rights Offering, as of
March 2, 2021, we have entered into backstop agreements (the
“Backstop Agreements”) with several parties (the “Backstop
Providers”) pursuant to which the Backstop Providers have agreed,
in the aggregate, to purchase in excess of $20,000,000 of New Notes
at par or shares of Common Stock at $2.57 per share (the “Backstop
Commitment”). The Backstop Agreements are subject to customary
terms and conditions, including payment, in principal amount of New
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 and effect the
Restructuring Transactions, we must receive net proceeds of at
least $20,000,000 from the Rights Offering. The current Backstop
Commitment will allow ION to satisfy this condition.
Further details of the Rights Offering will be
publicly announced and a prospectus supplement containing the
detailed terms of the Rights Offering will be filed with the SEC
following clearance of the registration statement by the SEC. For
additional details regarding the Restructuring Transactions,
including the Exchange Offer and the Rights Offering, please see
our Current Report on Form 8-K filed with the SEC on February 12,
2021.
A registration statement relating to
these securities has been filed with the Securities and Exchange
Commission, but has not yet become effective. These securities may
not be sold nor may offers to buy be accepted prior to the time the
registration statement becomes effective. The information in this
press release is not complete and is subject to change. This press
release shall not constitute an offer to sell or a solicitation of
an offer to buy the securities, nor shall there be any offer,
solicitation or sale of the securities in any state or jurisdiction
in which such offer, solicitation or sale would be unlawful under
the securities laws of such state or jurisdiction. The Rights
Offering will be made only by means of prospectus. Copies of the
prospectus, when it becomes available, will be distributed to all
eligible stockholders as of the Rights Offering Record Date and may
also be obtained free of charge on the SEC website
at www.sec.gov or by
contacting the information agent, D.F. King & Co., Inc., for
the Rights Offering.
About IONLeveraging 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.
ContactMike MorrisonExecutive Vice President
and Chief Financial Officer+1.281.879.3615
The information herein contains certain
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. 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; our 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 our Form 10-K for the year ended
December 31, 2020, filed on February 12, 2021, and our Forms S-1
and S-4, 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 Securities and Exchange Commission ("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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