ION announces certain holders of its second priority 2025 notes purchase ION’s indebtedness to PNC, agree to further forbearance extensions related to both the first lien and second lien debt

Rhea-AI Summary

ION Geophysical Corporation (NYSE: IO) announced that PNC Bank has sold its loans under the Revolving Credit and Security Agreement to holders of ION’s 2025 Notes. The company entered into amendments extending the current forbearance period until April 4, 2022. ION is in discussions regarding strategic alternatives to enhance its financial standing, which may include asset sales or restructuring. These moves aim to maximize stakeholder value amid ongoing financial challenges.

Positive

• Extended forbearance period until April 4, 2022, provides temporary relief.
• Ongoing discussions with 2025 Notes holders indicate potential pathways for financial recovery.

Negative

• Continued reliance on forbearance raises concerns about long-term financial stability.
• Ongoing financial discussions suggest potential distress, impacting investor confidence.

HOUSTON, March 09, 2022 (GLOBE NEWSWIRE) -- ION Geophysical Corporation (NYSE: IO) announced today that PNC Bank, National Association (“PNC”), has sold and assigned its commitment and outstanding loans under ION’s Revolving Credit and Security Agreement dated August 22, 2014 (as amended, the “Credit Agreement”) to certain holders of ION’s 2025 Notes (the “purchasing lenders”). In addition, ION entered into a First Amendment to the Second Forbearance and Seventh Amendment to the Credit Agreement with the purchasing lenders pursuant to which, among other things, the purchasing lenders have agreed to extend the current forbearance through April 4, 2022.  ION also announced that it had entered into Amendment No. 2 to the Forbearance Agreement with holders of more than 79% of its 2025 Notes to continue their forbearance through April 4, 2022.  The forbearances are subject to the terms and conditions of the relevant agreements, which are described in more detail in our current report on Form 8-K that will be filed with the SEC.

ION remains in continuing discussions with the holders of its 2025 Notes and other indebtedness regarding various strategic alternatives to strengthen its financial position and maximize stakeholder value. These strategic alternatives include, among others, a sale or business combination transaction or sales of assets, any of which may be executed as part of an in-court or out-of-court restructuring process. 

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.

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; the ultimate benefits of our completed restructuring transactions; political, execution, regulatory, and currency risks; the outcome or changes, if any, of our consideration of various strategic alternatives; and the impact to our liquidity in the current uncertain macroeconomic environment, including the war in Ukraine. 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 10-Q for the quarters ended March 31, 2021, June 30, 2021, and September 30, 2021, filed on May 6, 2021, August 12, 2021, and November 3, 2021, respectively. 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.

FAQ

What financial agreement did ION enter into as of March 2022?

ION entered into a First Amendment to the Second Forbearance and Seventh Amendment to the Credit Agreement to extend the current forbearance through April 4, 2022.

Who purchased ION's loans from PNC Bank?

Certain holders of ION's 2025 Notes purchased the loans from PNC Bank.

What strategic alternatives is ION considering?

ION is considering various strategic alternatives including asset sales or a business combination transaction.

What impact does the forbearance have on ION's financial position?

The forbearance suggests ongoing financial challenges but also provides temporary relief as ION explores financial restructuring.