ION Geophysical Corporation (NYSE: IO) confirmed that after considering several strategic options it has filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Southern District of Texas, Houston Division (the Bankruptcy Court). The decision has been taken to pursue a value-maximizing transaction that will help bolster the Company's balance sheet and position it for long-term success.

ION decided to enter into a Restructuring Support Agreement (the RSA) with the lenders under its Credit Agreement and the holders of roughly 80% of its 2025 Notes in connection with the Chapter 11 filing, under which the parties promised to support the Company's Chapter 11 plan of reorganization (the Plan).

The Company has submitted several standard motions with the Bankruptcy Court, including, but not confined to, paying employees, and continuing existing benefit programs without interruption, as well as satisfying obligations to customers, suppliers, employees, and other stakeholders. These motions are common in the Chapter 11 procedure, and ION expects them to be addressed and accepted within the first few days of the case.

Furthermore, the Company and the RSA's consenting creditors have agreed to the terms of a comprehensive restructuring, which includes the Plan, which is based on either a debt-for-equity exchange with the potential sale of certain assets to one or more third parties. Another option is the sale of substantially all of the Company's assets.

Under the terms of the RSA, ION will continue to seek third-party interest in prospective sale transactions involving the Company, with the goal of maximizing the value of the Company's assets through an open and transparent process that allows interested buyers to submit bids for assets.