exv10w1







EXHIBIT 10.1




REGISTRATION RIGHTS AGREEMENT




     This REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of September 18, 2008,
is by and between 1236929 Alberta Ltd. (the “Shareholder”) and ION Geophysical Corporation,
a Delaware corporation (the “Company”). Certain capitalized terms used herein are defined
in Section 6 below. Capitalized terms not otherwise defined herein shall have the
respective meanings ascribed to them in the Share Purchase Agreement (as hereinafter defined).



RECITALS:




     WHEREAS, the Shareholder, ARAM Systems Ltd., an Alberta corporation (“ARAM”), and
Canadian Seismic Rentals Inc., an Alberta corporation (“CSRI” and, together with ARAM, the
“Acquired Entities”), certain other shareholders of the Acquired Entities and the Company
entered into that certain Share Purchase Agreement dated as of July 8, 2008, and entered into that
certain Amended and Restated Share Purchase Agreement dated September 17, 2008 (as such Amended and
Restated Share Purchase Agreement may be further amended, restated, modified or supplemented, the
“Share Purchase Agreement”), that provides, subject to the terms and conditions thereof,
for the purchase by the Company of 100% of the issued and outstanding shares of the Acquired
Entities held by the Shareholder and such other shareholders (the “Share Purchase”);



     WHEREAS, the Buyer Common Stock is listed on the NYSE;



     WHEREAS, as part of the consideration to be paid in the Share Purchase, the Shareholder has
acquired the Share Consideration, consisting in the aggregate, of 3,629,211 shares of Common Stock;



     WHEREAS, in order to induce the Shareholder to consummate the transactions under the Share
Purchase Agreement, the Company has agreed to provide certain registration rights on the terms and
subject to the conditions set forth herein;



     WHEREAS, in order to induce the Company to consummate the transactions under the Share
Purchase Agreement, the Shareholder has agreed to be bound by the terms and conditions set forth
herein; and



     WHEREAS, it is a condition to the closing of the transactions under the Share Purchase
Agreement that the Shareholder and the Company enter into this Agreement.



     NOW, THEREFORE, in consideration of the premises and the covenants and agreements contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby agree as
follows:



SECTION 1. REGISTRATION UNDER THE SECURITIES ACT.




     1.1 Registration.



     As soon as practicable after the Financial Statements Delivery Date, the Company shall prepare
and file with the Securities and Exchange Commission (the “SEC”) a registration statement
on the appropriate form for the purpose of registering under the Securities Act (as hereinafter
defined) all of the Registrable Shares (as hereinafter defined) for distribution by the Shareholder
(the “Registration Statement”). The Company agrees to use its Best Efforts to cause the
Registration Statement to be declared effective by the SEC as soon as practicable after the filing
thereof with the SEC.



 









 




The registration of such Registrable Shares to be effected pursuant to this Agreement is
referred to herein as the “Registration.” The Company shall keep the Registration Statement
effective (including through the filing of any required post-effective amendments) until the
earlier to occur of (i) the date after which all of the Registrable Shares registered thereunder
shall have been distributed by the Shareholder and (ii) the date that is the first anniversary of
the effective date of the Registration Statement; provided, that such date shall be
extended by the amount of time of any period during which the Shareholder may not use the
Registration Statement pursuant to the terms of Section 1.2(e) or Section 2 below,
or as a result of a breach by the Company of its obligations hereunder. Thereafter, the Company
shall be entitled to withdraw the Registration Statement and, upon such withdrawal, the Shareholder
shall have no further right to distribute any of the Registrable Shares pursuant to the
Registration Statement (or any prospectus relating thereto).




     1.2 Registration Procedures. Subject to the terms and conditions hereof, the Company
shall use its Best Efforts to effect the registration of such Registrable Securities for resale or
distribution by the Shareholder in accordance with the intended method of disposition thereof, and
pursuant thereto the Company shall as expeditiously as practicable:




	 	(a)	 	prepare and file with the SEC the Registration Statement with respect to such
Registrable Securities (and any amendment, including any post-effective amendment, to
the Registration Statement that the Company deems to be necessary) and use its Best
Efforts to cause the Registration Statement to become effective within sixty (60) days
after the Financial Statements Delivery Date and to comply with the provisions of the
Securities Act applicable to it (provided that before filing the Registration Statement
or prospectus or any amendments or supplements thereto, the Company shall furnish to the
Shareholder copies of all such documents proposed to be filed so as to provide the
Shareholder and its counsel a reasonable opportunity to review and comment on such
documents);
	 
	 	(b)	 	furnish to the Shareholder such number of copies of the Registration Statement,
each amendment and supplement thereto, the prospectus included in such Registration
Statement (including each preliminary prospectus) and such other documents as the
Shareholder may reasonably request in order to facilitate the distribution of the
Registrable Securities owned by the Shareholder;
	 
	 	(c)	 	make such filings of the prospectus, and any amended or supplemented prospectus,
as may be required under Rule 424 and keep the Registration Statement with respect to
such Registrable Securities effective for the time periods specified in Section
1.1 in order to permit the prospectus forming a part thereof to be usable for the
offer and sale or distribution of the Registrable Securities owned by the Shareholder;
	 
	 	(d)	 	use its Best Efforts to register or qualify such Registrable Securities under
such other securities or blue sky laws of such jurisdictions as the Shareholder
reasonably requests and do any and all other acts and things which may be reasonably
necessary or advisable to enable the Shareholder to consummate the disposition in such
jurisdictions of the Registrable Securities owned by the Shareholder (provided that the
Company shall not be required to (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
subsection, (ii) subject itself to taxation in any such jurisdiction or (iii) consent to
general service of process in any such jurisdiction);
	 
	 	(e)	 	notify the Shareholder (i) when the Registration Statement or any post-effective
amendment has become effective under the Securities Act, (ii) of the happening of any
event as a result of which the prospectus included in the Registration Statement
contains an untrue statement of a material





 









 











	 	 	 	fact or omits any fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading (whereupon the Shareholder
shall immediately cease any offers, sales or other distribution of Registrable
Securities thereunder), and, at the request of the Shareholder, the Company shall
prepare a supplement or amendment to such prospectus so that, as thereafter delivered
to the Shareholder in connection with the distribution of such Registrable Securities,
such prospectus shall not contain an untrue statement of a material fact or omit to
state any fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading and (iii) of the issuance of any stop order
suspending the effectiveness of the Registration Statement, or of any order suspending
or preventing the use of any related prospectus or suspending the qualification of any
of the Registrable Securities included in the Registration Statement for sale or
distribution in any jurisdiction;
	 
	 	(f)	 	cause all such Registrable Securities to be listed on the NYSE and on each
securities exchange on which similar securities issued by the Company are then listed;
	 
	 	(g)	 	in the event of the issuance of any stop order suspending the effectiveness of
the Registration Statement, or of any order suspending or preventing the use of any
related prospectus or suspending the qualification of any Registrable Securities
included in the Registration Statement for sale or distribution in any jurisdiction, the
Company shall use its Best Efforts promptly to obtain the withdrawal of such order and
shall prepare and file an amended or supplemented prospectus, if required; and
	 
	 	(h)	 	use its Best Efforts to cause such Registrable Securities covered by the
Registration Statement to be registered with or approved by such other governmental
agencies or authorities as may be necessary to enable the Shareholder to consummate the
resale and distribution of such Registrable Securities.





     1.3 Expenses.




	 	(a)	 	Registration Expenses. All Registration Expenses (as hereinafter
defined) shall be borne by the Company.
	 
	 	(b)	 	Selling Expenses. All fees and expenses of counsel for the Shareholder,
state securities or blue sky fees and expenses and broker or dealer discounts or
commissions attributable to the sale or distribution of the Registrable Securities shall
be borne solely by the Shareholder.




 









 











SECTION 2. LOCKUP AGREEMENT.




     2.1 The Shareholder hereby agrees to not effect any public sale or distribution (including any
sales pursuant to Rule 144) of equity securities of the Company, or any securities convertible into
or exchangeable or exercisable for such securities, during the seven (7) days prior to, and the
ninety (90) day period beginning on, the effective date of any underwritten registered public
offering of equity securities of the Company or securities convertible or exchangeable into or
exercisable for equity securities of the Company, unless the underwriters managing the registered
public offering otherwise agree, and the Shareholder will deliver an undertaking to the managing
underwriters (if requested) consistent with this covenant. The Company will give the Shareholder at
least ten (10) days prior notice of any such effective date. The Shareholder shall not be obligated
to comply with the provisions of this Section 2.1 more than two (2) times in any 12-month
period.



SECTION 3. INDEMNIFICATION.




     3.1 Indemnification by the Company. The Company agrees to indemnify, to the extent
permitted by law, the Shareholder against all losses, claims, damages, liabilities and expenses
caused by any untrue or alleged untrue statement of material fact contained in any registration
statement or prospectus, or any amendment thereof or supplement thereto or any omission or alleged
omission of a material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as the same are caused by or contained in any information
furnished in writing to the Company by the Shareholder expressly for use therein or by the failure
of the Shareholder to deliver a copy of the Registration Statement or prospectus or any amendments
or supplements thereto after the Company has furnished the Shareholder with a sufficient number of
copies of the same.



     3.2 Indemnification by the Shareholder. The Shareholder shall furnish to the Company
in writing such information as the Company reasonably requests for use in connection with the
Registration Statement or prospectus and, to the extent permitted by law, shall indemnify the
Company, its directors and officers and each Person (as hereinafter defined) who controls the
Company (within the meaning of the Securities Act) against any losses, claims, damages, liabilities
and expenses resulting from any untrue or alleged untrue statement of material fact contained in
the Registration Statement or prospectus or any amendment thereof or supplement thereto or any
omission or alleged omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, but only to the extent that any information so furnished in
writing by the Shareholder contains such untrue statement or omits a material fact required to be
stated therein necessary to make the statements therein not misleading; provided,
however, that any such obligation of the Shareholder to indemnify the Company hereunder
shall be limited to the aggregate value of the Acquired Shares at the effective date of the
Registration Statement.



     3.3 Indemnification Procedures. Any Person entitled to indemnification hereunder
shall (i) give prompt written notice to the indemnifying party of any claim with respect to which
it seeks indemnification (provided that the failure to give prompt notice shall not impair any
Person’s right to indemnification hereunder to the extent such failure has not prejudiced the
indemnifying party) and (ii) unless in such indemnified party’s reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may exist with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is assumed, the indemnifying party shall not
be subject to any liability for any settlement made by the indemnified party without its consent
(but such consent shall not be unreasonably withheld). An indemnifying party who is not entitled
to, or elects not to, assume the defense of a claim shall not be obligated to pay the fees and
expenses of more than one counsel (in addition to



 









 







local counsel) for all parties indemnified by such indemnifying party with respect to such
claim, unless in the reasonable judgment of any indemnified party a conflict of interest may exist
between such indemnified party and any other of such indemnified parties with respect to such
claim.



     3.4 Investigation; Contribution. The indemnification provided for under this
Agreement shall remain in full force and effect regardless of any investigation made by or on
behalf of the indemnified party or any officer, director or controlling Person of such indemnified
party and shall survive the transfer of securities. If the indemnification provided under
Section 3.1 or Section 3.2 of this Agreement is for any reason unavailable to, or
insufficient to hold harmless, an indemnified party, then each indemnifying party shall contribute
to the amount paid or payable to the indemnified party or parties an amount that is proportionate
to reflect the relative fault of such indemnifying party on the one hand and the indemnified party
or parties on the other.



SECTION 4. RULE 144 TRANSACTIONS.




     4.1 Undertaking to File Reports and Cooperate in Rule 144 Transactions. For as long
as the Shareholder continues to hold any Common Stock, the Company shall use its Best Efforts to
file with the SEC, on a timely basis, all annual, quarterly and other periodic reports required to
be filed by it under Sections 13 and 15(d) of the Exchange Act, and the rules and regulations
thereunder; provided, however, that the foregoing shall not be construed to require
the Company to prepare and file periodic reports if it is not required to do so under the Exchange
Act. In the event of any proposed sale by the Shareholder of Common Stock pursuant to Rule 144
under the Securities Act or otherwise as provided herein, which sale is to be made in accordance
with the terms of Section 5.1(b) hereof, the Company shall cooperate with the Shareholder
so as to enable such sales to be made in accordance with applicable laws, rules and regulations,
the requirements of the transfer agent of the Company and the reasonable requirements of the broker
through which the sales are proposed to be executed.



SECTION 5. RESTRICTIONS ON TRANSFER.




     5.1 Permitted Transfers. The Shareholder hereby agrees that, until it and any
permitted transferees under Section 5.1(b) or (c) hereunder have disposed of all of
the Registrable Securities, it will not, directly or indirectly, without the prior written consent
of the Company, sell, distribute, transfer or otherwise dispose of any shares of Common Stock
except:




	 	(a)	 	sales of Common Stock pursuant to Rule 144 under the Securities Act;
	 
	 	(b)	 	a bona fide pledge of or the granting of a security interest in the shares of
Common Stock to an institutional lender for money borrowed, provided that such
lender acknowledges in writing that it has received a copy of this Agreement and agrees,
upon its becoming the owner of, or obtaining dispositive authority with respect to or in
connection with any disposition of, any such shares of Common Stock, to be bound by the
provisions of this Agreement in connection with any right it may have to dispose of or
vote any such shares of Common Stock (and, upon agreeing so to be bound, the provisions
of this Agreement shall inure to the benefit of such party);
	 
	 	(c)	 	dispositions of Common Stock by the Shareholder to Donald G. Chamberlain as
controlling equity owner of Shareholder, or to any Family Member (as hereinafter
defined) of Mr. Chamberlain; provided, however, that each such
transferee shall receive and hold such Common Stock subject to, and such transferee and
all of the transferees’ Affiliates (as hereinafter defined) shall agree to be bound by,
all the terms of this Agreement, which terms shall also inure to the




 









 












	 	 	 	benefit of such transferees, and there shall be no further transfer of such shares
except in accordance with the provisions of this Section 5.1; or
	 
	 	(d)	 	dispositions pursuant to any merger, consolidation, reorganization or
recapitalization to which the Company is a party or in connection with any
reclassification of the Common Stock.





SECTION 6. DEFINITIONS.




     “Affiliate” means, with respect to any specified Person, any other Person that,
directly or indirectly or through one or more intermediaries, controls, is controlled by or is
under common control with such specified Person.



     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder, or any successor statute.



     “Family Member” means (a) with respect to any individual, such individual’s spouse,
any descendants (whether natural or adopted), any trust (all of the beneficial interests of which
are owned by any of such individuals or by any of such individuals together with any organization
described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended), the estate of any
such individual, and any corporation, association, partnership or limited liability company all of
the equity interests of which are owned by those above described individuals, trusts or
organizations and (b) with respect to any trust, the owners of the beneficial interests of such
trust.



     “Person” means any individual, firm, partnership, corporation, trust, joint venture,
limited liability company, association, joint stock company, unincorporated organization or any
other entity or organization, including a governmental entity or any department, agency or
political subdivision thereof.



     “Registrable Securities” means (i) the Share Consideration, (ii) any other Buyer
Common Stock issued as a dividend or other distribution on or as a result of a subdivision,
combination or reclassification of any Share Consideration and (iii) any Common Stock issued to the
Shareholder in any merger, consolidation or business combination involving the Company.



     “Registration Expenses” means all expenses incident to the Company’s performance of or
compliance with this Agreement, including without limitation all registration and filing fees, fees
and expenses of compliance with securities or blue sky laws, any fees with respect to filings
required to be made with the NASD, printing expenses, messenger and delivery and mailing expenses,
fees and disbursements of custodians, and fees and disbursements of counsel for the Company and all
registered public accounting firms retained by the Company and other Persons retained by the
Company.



     “Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any successor statute.



SECTION 7. MISCELLANEOUS.




     7.1 Legends and Stop Transfer Orders.




	 	(a)	 	The Shareholder hereby agrees that all certificates representing Registrable
Securities shall have the following legend (or other legend to the same effect): “The
shares represented by this certificate are subject to certain restrictions on transfer
and other restrictions pursuant to the provisions of a Registration Rights Agreement,
dated September 18, 2008, between the Shareholder and the Company, a copy of which is on
file at the office of the corporate secretary of the Company.”




 









 












	 	(b)	 	The Shareholder hereby agrees to the entry of stop transfer orders with the
transfer agent and registrar of the Common Stock against the transfer (other than in
compliance with this Agreement) of legended securities held by the Shareholder (or their
permitted transferees under Section 5.1(b) or (c) hereof).
	 
	 	(c)	 	The Company agrees to remove any stop transfer orders provided in Section
7.1(b) in sufficient time to permit any party to make any transfer permitted by the
terms of this Agreement.





     7.2 No Inconsistent Agreements. The Company shall not hereafter enter into any
agreement with respect to its securities which violates the rights granted to the Shareholder in
this Agreement.



     7.3 Specific Performance. The parties hereto acknowledge and agree that in the event
of any breach of this Agreement, the non-breaching parties would be irreparably harmed and could
not be made whole by monetary damages. It is accordingly agreed that the parties hereto shall and
do hereby waive the defense in any action for specific performance that a remedy at law would be
adequate and that the parties hereto, in addition to any other remedy to which they may be entitled
at law or in equity, shall be entitled to compel specific performance of this Agreement in any
action instituted hereunder.



     7.4 Amendments and Waivers. The failure of any party to enforce any of the provisions
of this Agreement shall in no way be construed as a waiver of such provisions and shall not affect
the right of such party thereafter to enforce each and every provision of this Agreement in
accordance with its terms. No modification, amendment or waiver of any provision of this Agreement
shall be effective against the Company or the Shareholder except by a written agreement signed by
the Company and the Shareholder.



     7.5 Successors and Assigns. All covenants and agreements in this Agreement by or on
behalf of any of the parties hereto shall bind and inure to the benefit of the respective heirs,
legal representatives, successors and permitted assigns of the parties hereto, whether so expressed
or not (including, without limitation, any Person that is a legal representative or permitted
assignee of, or the successor to, the Company or the Shareholder).



     7.6 Severability. If any term, provision, covenant or restriction of this Agreement,
or any part thereof, is held by a court of competent jurisdiction or any foreign federal, state,
county or local government or any other governmental, regulatory or administrative agency or
authority to be invalid, void, unenforceable or against public policy for any reason, the remainder
of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force
and effect and shall in no way be affected, impaired, or invalidated.



     7.7 Entire Agreement. Except as otherwise expressly set forth herein, this document
embodies the complete agreement and understanding among the parties hereto with respect to the
subject matter hereof and supersedes and preempts any prior understandings, agreements or
representations by or among the parties, written or oral, which may have related to the subject
matter hereof in any way.



     7.8 Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which shall constitute one and the same instrument,
and it shall not be necessary in making proof of this Agreement to produce or account for more than
one such counterpart.



     7.9 Headings. The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning of terms contained herein.



 









 





     7.10 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS BY THE INTERNAL
LAWS OF THE STATE OF DELAWARE.



     7.11 Notices. All notices, requests, demands, claims, instructions and other
communications hereunder shall be in writing. Any notice, request, demand, claim, instruction or
other communication to be given hereunder by any party to the other parties shall be sent by
facsimile (with confirmation received of the recipient’s number) to the number stated below or
shall be delivered personally or sent by registered or certified mail (postage prepaid and return
receipt requested) to the address stated below.



If to the Company:




ION Geophysical Corporation

2105 City West Blvd., Suite 400

Houston, Texas 77042

Attention: Brian Hanson

Facsimile: 281-879-3674




Copy to (which shall not constitute notice):




ION Geophysical Corporation

2105 City West Blvd., Suite 400

Houston, Texas 77042

Attention: David L. Roland, Esq.

Facsimile: 281-879-3600




And:




Mayer Brown LLP

700 Louisiana Street, Suite 3400

Houston, Texas 77002

Attention: Marc H. Folladori

Facsimile: 713-238-4696




If to the Shareholder:




1236929 Alberta Ltd.

161 Lochend Drive

Cochrane, Alberta T4C 2H2

Attention: Donald G. Chamberlain

Facsimile: 403-932-2438




Copy to (which shall not constitute notice):




Borden Ladner Gervais LLP

1000 Canterra Tower

400 Third Avenue S.W.

Calgary, Alberta T2P 4H2

Attention: David C. Whelan

Facsimile: 403-266-1395




 









 




or at such other facsimile number or address for a party as shall be specified by like notice. Any
notice which is delivered personally in the manner provided herein shall be deemed to have been
duly given to the party to whom it is directed upon actual receipt by such party. Any notice which
is sent by facsimile or addressed and mailed in the manner herein provided shall be conclusively
presumed to have been duly given to the party to which it is addressed on the date indicated on the
facsimile confirmation or the postal receipt. Any party may change the address to which notices,
requests, demands, claims and other communications hereunder are to be delivered by giving the
other parties notice in the manner herein set forth.




[Signature Page Follows]




 









 








     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first above written.



	 	 	 	 	 	 	 
	 	 	ION GEOPHYSICAL CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David L. Roland	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	David L. Roland	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	Senior Vice President and General Counsel	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	1236929 ALBERTA LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Donald Chamberlain	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	DONALD CHAMBERLAIN	 	 
	 

	 	Title:
	 	President