ION Adopts Shareholder Rights Plan
(NYSE: IO) today announced that its Board of Directors adopted a Shareholder
Rights Plan. The Rights Plan is designed to enable all of the Company’s
shareholders to realize the full long-term value of their investment and to
provide for fair and equal treatment for all shareholders in the event that an
unsolicited attempt is made to acquire the Company.
The Company’s Board of Directors believes the value of the Company’s
assets is not reflected in the current market price of the Company’s stock,
which may make the Company vulnerable to coercive or abusive takeover tactics.
The Company believes that adoption of the Rights Plan is in the best interests
of all the Company’s shareholders, as it will help to protect shareholders
against takeover tactics that may be used to gain control of the Company
without paying a full and fair price that is in the best interest of all
shareholders. The Plan, which was adopted following evaluation and
consultation with outside advisors, is similar to those adopted by numerous
publicly traded companies and is not intended to prevent a takeover of the
Company on terms that are fair to and in the best interests of all the
Company’s shareholders.
In connection with the adoption of the Rights Plan, the Company’s Board of
Directors declared a dividend distribution of one Preferred Stock Right for
each outstanding share of Common Stock of the Company held by shareholders of
record as of the close of business on
initially be represented by the Company’s common stock certificates and will
be transferred only with the common stock. The Rights distribution is not
taxable to shareholders under U.S. laws.
Under the Rights Plan, with certain exceptions, the Rights will become
exercisable only if a person or group acquires 20 percent or more of the
common stock of the Company or commences a tender or exchange offer that could
result in ownership of 20 percent or more of the Company’s common stock. The
Rights Plan has a limited term of three years and will expire on
2011
Each Right will entitle its holder to buy one one-thousandth of a share of
a newly created class of junior participating preferred stock of the Company
at an exercise price of
acquisition of 20 percent or more of the Company’s outstanding common stock by
a person or group, the holders of the Rights (other than the acquiring person
or group) will be entitled to purchase shares of common stock at half-price,
and, in the event of a subsequent merger or other acquisition of the Company,
to buy shares of common stock of the acquiring entity at one-half of the
market price of those shares. The Rights are redeemable for
subject to adjustment, before the acquisition by a person or group of 20
percent or more of the Company’s Common Stock.
The Company will file a Current Report on Form 8-K and Form 8-A with the
United States Securities and Exchange Commission that will contain additional
information regarding the terms and conditions of the Rights Plan.
About ION
ION is a leading provider of geophysical technology, services, and
solutions for the global oil & gas industry. ION’s offerings allow E&P
operators to obtain higher resolution images of the subsurface to reduce the
risk of exploration and reservoir development, and enable seismic contractors
to acquire geophysical data more efficiently. Additional information about
ION is available at http://www.iongeo.com.
CONTACTS:
R. Brian Hanson
Chief Financial Officer
+1.281.879.3672
Jack Lascar
DRG&E
+1.713.529.6600
SOURCE ION Geophysical Corporation