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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JANUARY 17, 1997
INPUT/OUTPUT, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 1-13402 22-2286646
(STATE OF INCORPORATION) (COMMISSION FILE NO.) (IRS EMPLOYER
IDENTIFICATION NO.)
11104 WEST AIRPORT BOULEVARD, STAFFORD, TEXAS 77477
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (281) 933-3339
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ITEM 5. OTHER EVENTS
On January 17, 1997, the Board of Directors of Input/Output, Inc. (the
"Company") declared a dividend distribution of one Right for each outstanding
share of the Company's common stock, $0.01 par value (the "Common Stock"), to
stockholders of record at the close of business on January 27, 1997. Each
Right entitles the registered holder to purchase from the Company one
one-thousandth (1/1,000) of a share of Series A Preferred Stock, par value
$0.01 per share (the "Preferred Stock"), at a Purchase Price of $200 per one
one-thousandth (1/1,000) of a share, subject to adjustment. The description
and terms of the Rights are set forth in a Rights Agreement (the "Rights
Agreement") between the Company and Harris Trust and Savings Bank, as Rights
Agent (the "Rights Agent").
Initially, the Rights will be attached to all Common Stock certificates
representing shares then outstanding, and no separate Rights Certificates
will be distributed. The Rights will separate from the Common Stock upon the
earlier of (i) the date of a public announcement by the Company that a person
or group of affiliated or associated persons (an "Acquiring Person") has
acquired, or obtained the right to acquire, beneficial ownership of twenty
percent (20%) or more of the outstanding shares of Common Stock (the "Stock
Acquisition Date"), or (ii) ten (10) business days (or such later date as the
Board of Directors shall determine) following the commencement of a tender or
exchange offer that would result in a person or group beneficially owning
twenty percent (20%) or more of such outstanding shares of Common Stock. The
date the Rights separate is referred to as the "Distribution Date."
Until the Distribution Date, (i) the Rights will be evidenced by the
Common Stock certificates and will be transferred only with such Common Stock
certificates, (ii) new Common Stock certificates issued after January 27,
1997 will contain a notation incorporating the Rights Agreement by reference,
and (iii) the surrender for transfer of any certificates for Common Stock
outstanding will also constitute the transfer of the Rights associated with
the Common Stock represented by such certificates.
The Rights are not exercisable until the Distribution Date and will
expire at the close of business on January 27, 2007, unless earlier redeemed
by the Company as described below.
As soon as practicable after the Distribution Date, Rights Certificates
will be mailed to holders of record of the Common Stock as of the close of
business on the Distribution Date and, thereafter, the separate Rights
Certificates will represent the Rights. Except in connection with shares of
Common Stock issued or sold pursuant to the exercise of stock options or
under any employee plan or arrangements, or upon the exercise, conversion or
exchange of securities hereinafter issued by the Company, or as otherwise
determined by the Board of Directors, only shares of Common Stock issued
prior to the Distribution Date will be issued with Rights.
In the event that (i) the Company is the surviving corporation in a
merger or other business combination with an Acquiring Person (or any
associate or affiliate thereof) and its Common Stock remains outstanding and
unchanged, (ii) any person shall acquire beneficial ownership of more than
twenty percent (20%) of the outstanding shares of Common Stock (except
pursuant to certain consolidations or mergers involving the Company or sales
or transfers of the combined assets, cash flow or earning power of the
Company and its subsidiaries), or (iii) there occurs a reclassification of
securities, a recapitalization of the Company or any of certain business
combinations or other transactions (other than certain consolidations and
mergers involving the Company and sales or transfers of the combined assets,
cash flow or earning power of the Company and its subsidiaries) involving the
Company or any of its subsidiaries which has the effect of increasing by more
than one percent (1%) the proportionate share of any class of the outstanding
equity securities of the Company or any of its subsidiaries beneficially
owned by an Acquiring Person (or any associate or affiliate thereof), each
holder of a Right (other than the Acquiring Person and certain related
parties) will thereafter have the right to receive, upon exercise, Common
Stock (or, in certain circumstances, cash, property or other securities of
the Company) having a value equal to two times the Purchase Price of the
Right. Notwithstanding any of the foregoing, following the occurrence of any
of the events described in this paragraph, all Rights that are, or (under
certain circumstances specified in the Rights Agreement) were, beneficially
owned by any Acquiring Person will be null and void.
In the event that, at any time following the Stock Acquisition Date, (i)
the Company shall enter into a merger or other business combination
transaction in which the Company is not the surviving corporation, (ii) the
Company is the surviving corporation in a consolidation, merger or similar
transaction pursuant to which all or part of the outstanding shares of Common
Stock are changed into or exchanged for stock or other securities of any
other person or cash or any other property or (iii) more than 50% of the
combined assets, cash flow or earning power of the Company and its
subsidiaries is sold or transferred (in each case other than certain
consolidations with, mergers with and into, or sales of assets, cash flow or
earning power by or to subsidiaries of the Company as specified in the Rights
Agreement), each holder of a Right (except Rights which previously have been
voided as set forth above) shall thereafter have the right to receive, upon
exercise, common stock of the acquiring company having a value equal to two
times the Purchase Price of the Right. The events described in this
paragraph and in the preceding paragraph are referred to as the "Triggering
Events."
The Purchase Price payable, the number and kind of shares covered by each
Right and the number of Rights outstanding are subject to adjustment from
time to time to prevent dilution (i) in the event of a stock dividend on, or
a subdivision, combination or reclassification of, the Preferred Stock, (ii)
if holders of the Preferred Stock are granted certain rights, options or
warrants to subscribe for Preferred Stock or securities convertible into
Preferred Stock at less than the current market price of the Preferred Stock,
or (iii) upon the distribution to holders of the Preferred Stock
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of evidences of indebtedness, cash (excluding regular quarterly cash
dividends), assets (other than dividends payable in Preferred Stock) or
subscription rights or warrants (other than those referred to in (ii)
immediately above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments amount to at least one percent (1%) of
the Purchase Price. No fractional shares of Preferred Stock are required to
be issued (other than fractions which are integral multiples of one
one-thousandth (1/1,000) of a share of Preferred Stock) and, in lieu thereof,
the Company may make an adjustment in cash based on the market price of the
Preferred Stock on the trading date immediately prior to the date of exercise.
At any time after any person or group becomes an Acquiring Person and
prior to the acquisition by such person or group of fifty percent (50%) or
more of the outstanding shares of Common Stock, the Board of Directors of the
Company may, without payment of the Purchase Price by the holder, exchange
the Rights (other than Rights owned by such person or group, which will
become void), in whole or in part, for shares of Common Stock at an exchange
ratio of one-half (1/2) the number of shares of Common Stock (or in certain
circumstances, Preferred Stock) for which a Right is exercisable immediately
prior to the time of the Company's decision to exchange the Rights (subject
to adjustment).
At any time following the Stock Acquisition Date, the Company may redeem
the Rights in whole, but not in part, at a price of $0.001 per Right (payable
in cash, shares of Common Stock or other consideration deemed appropriate by
the Board of Directors). Immediately upon the action of the Board of
Directors ordering redemption of the Rights, the Rights will terminate and
the only right of the holders of Rights will be to receive the $0.001
redemption price.
The term "Disinterested Director" means any member of the Board of
Directors of the Company who was a member of the Board prior to the date of
the Rights Agreement, and any person who is subsequently elected to the Board
if such person is recommended or approved by a majority of the Disinterested
Directors, but shall not include an Acquiring Person, or an affiliate or
associate of an Acquiring Person, or any representative of the foregoing
entities.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends. While it is expected that under
current federal income tax law, the distribution of the Rights will not be
taxable to stockholders or to the Company, stockholders may, depending upon
the circumstances, recognize taxable income in the event that the Rights
become exercisable for Common Stock (or other consideration) of the Company
or for common stock of an acquiring company as set forth above or in the
event that the Rights are redeemed.
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Other than those provisions relating to the principal economic terms of
the Rights, any of the provisions of the Rights Agreement may be amended by
the Board of Directors of the Company prior to the Distribution Date;
PROVIDED, that any amendments after the Stock Acquisition Date must be
approved by a majority of the Disinterested Directors. After the
Distribution Date, the provisions of the Rights Agreement may be amended by
the Board in order to cure any ambiguity, inconsistency or defect, to make
changes which do not adversely affect the interest of holders of Rights
(excluding the interest of any Acquiring Person) or to shorten or lengthen
any time period under the Rights Agreement; PROVIDED, HOWEVER, that no
amendment to adjust the time period governing redemption shall be made at
such time as the Rights are not redeemable.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A
filed on January 27, 1997. A copy of the Rights Agreement is available free
of charge from the Rights Agent. This summary description of the Rights does
not purport to be complete and is qualified in its entirety by reference to
the Rights Agreement, which is attached hereto as Exhibit 4 and incorporated
herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS
4 Rights Agreement, dated as of January 17, 1997, by and between
Input/Output, Inc. and Harris Trust and Savings Bank, as Rights Agent,
including exhibits thereto.
99 Press Release dated January 17, 1997.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
INPUT/OUTPUT, INC.
January 24, 1997 By: /s/ ROBERT P. BRINDLEY
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Robert P. Brindley
Senior Vice President, Chief
Financial Officer and Secretary
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