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FORM 10-K/A-1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------------
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
FOR THE FISCAL YEAR ENDED MAY 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
FOR THE TRANSITION PERIOD FROM ______ TO ______
COMMISSION FILE NUMBER 1-13402
INPUT/OUTPUT, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 22-2286646
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
11104 WEST AIRPORT BLVD., STAFFORD, TEXAS 77477
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (281) 933-3339
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
COMMON STOCK, $0.01 PAR VALUE NEW YORK STOCK EXCHANGE
PREFERRED STOCK PURCHASE RIGHTS NEW YORK STOCK EXCHANGE
(TITLE OF CLASS) (NAME OF EACH EXCHANGE ON WHICH REGISTERED)
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
NONE
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes: [X] No: [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
Aggregate market value of the voting and non-voting common equity held by
non-affiliates of the registrant at June 30, 1998 (for purposes of the
below-stated amount only, all directors, officers and 5% or more stockholders
are presumed to be affiliates):
$568,991,000
Indicate the number of shares outstanding of the registrant's classes of
Common Stock, as of the latest practicable date.
<TABLE>
<CAPTION>
TITLE OF EACH CLASS NUMBER OF SHARES OUTSTANDING
OF COMMON STOCK AT JUNE 30, 1998
--------------- ----------------
<S> <C>
COMMON STOCK, $0.01 PAR VALUE 44,584,634
</TABLE>
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the definitive Proxy Statement for the Registrant's 1998 Annual
Meeting of Stockholders are incorporated by reference into Part III hereof.
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<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K:
(3) Exhibits:
<TABLE>
<S> <C>
23.1 --Consent of KPMG Peat Marwick LLP
99.1 --Information, Financial Statements and Exhibits required by
Form 11-K for the Input/Output, Inc. Employee Stock
Purchase Plan
</TABLE>
<PAGE>
SIGNATURES
The undersigned registrant hereby amends the following items, financial
statements and exhibits of its Annual Report for its fiscal year ended May
31, 1998 on Form 10-K as set forth in the pages attached hereto:
To file as Exhibit 99.1 the Information, Financial Statements and
Exhibits required by Form 11-K for the Input/Output, Inc. Employee Stock
Purchase Plan.
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Form 10-K/A-1
report to be signed on its behalf by the undersigned, thereunto duly
authorized in the city of Stafford, State of Texas, on October 28, 1998.
Input/Output, Inc.
/s/ W.J. Zeringue
-------------------------------------
Chairman and
Chief Executive Officer
S-1
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
Compensation Committee of the Board of Directors
Input/Output, Inc.:
We consent to the incorporation by reference in the registration statements
(No. 33-54394, No. 33-46386, No. 33-50620, No. 33-85304, No. 333-14321 and
No. 333-24125) on Form S-8 of Input/Output, Inc. of our report dated October
26, 1998, relating to the statement of net assets available for plan benefits
of the Input/Output, Inc. Employee Stock Purchase Plan as of June 30, 1998
and 1997, and the related statement of changes in net assets available for
plan benefits for the year ended June 30, 1998 and the period from April 1,
1997 (date operations commenced) through June 30, 1997, which report appears
in the Form 10-K/A-1 of Input/Output, Inc. for the fiscal year ended May 31,
1998.
/s/ KPMG Peat Marwick LLP
-----------------------------------
Houston, Texas
October 28, 1998
<PAGE>
EXHIBIT 99.1
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Input/Output, Inc. Employee Stock Purchase Plan
Independent Auditors' Report. . . . . . . . . . . . . . . . . . . F-2
Statements of Net Assets Available for Plan Benefits
as of June 30, 1998 and 1997. . . . . . . . . . . . . . . . . . . F-3
Statements of Changes in Net Assets Available for
Plan Benefits for the year ended June 30, 1998 and
for the period from April 1, 1997 (date operations
commenced) through June 30, 1997. . . . . . . . . . . . . . . . . F-3
Notes to Financial Statements . . . . . . . . . . . . . . . . . . F-4
</TABLE>
F-1
<PAGE>
INDEPENDENT AUDITORS' REPORT
Compensation Committee of the Board of Directors
Input/Output, Inc.:
We have audited the accompanying statements of net assets available for plan
benefits of the Input/Output, Inc. Employee Stock Purchase Plan as of June
30, 1998 and 1997 and the related statements of changes in net assets
available for plan benefits for the year ended June 30, 1998 and for the
period from April 1, 1997 (date operations commenced) through June 30, 1997.
These financial statements are the responsibility of the Plan's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the
Input/Output, Inc. Employee Stock Purchase Plan as of June 30, 1998 and 1997
and the changes in net assets available for plan benefits for the year ended
June 30, 1998 and for the period from April 1, 1997 (date operations
commenced) through June 30, 1997 in conformity with generally accepted
accounting principles.
/s/ KPMG Peat Marwick LLP
-----------------------------------
Houston, Texas
October 26, 1998
F-2
<PAGE>
INPUT/OUTPUT, INC. EMPLOYEE STOCK PURCHASE PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
<TABLE>
<CAPTION>
June 30,
----------------------------
1998 1997
----------- -----------
<S> <C> <C>
ASSETS
------
Cash. . . . . . . . . . . . . . . . . . . . . . . $ 261,510 $ 250,692
---------- -----------
Investments in shares of Input/Output, Inc.
Common Stock at fair value. . . . . . . . . . . 760,968 --
Net Assets available for plan benefits. . . . . . $1,022,478 $ 250,692
---------- -----------
---------- -----------
</TABLE>
INPUT/OUTPUT, INC. EMPLOYEE STOCK PURCHASE PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
<TABLE>
<CAPTION>
Period from April 1, 1997
(date operations
Year Ended commenced) through
June 30, 1998 June 30, 1997
------------- -------------
<S> <C> <C>
Additions to assets:
Employee contributions. . . . . . . . . . . . . $995,544 $250,692
Net appreciation in market value of
Input/Output, Inc. Common Stock . . . . . . . . 109,473 --
Net realized gain on sales and distributions of
Input/Output, Inc. Common Stock . . . . . . . . 209,471 --
---------- --------
Total additions. . . . . . . . . . . . . . . . . . 1,314,488 250,692
---------- --------
Subtractions:
Distributions to participants . . . . . . . . . 542,702 --
---------- --------
Change in net assets available for plan benefits
during the year . . . . . . . . . . . . . . . . $771,786 $250,692
---------- --------
---------- --------
Net Assets available for plan benefits:
At beginning of period. . . . . . . . . . . . . $250,692 $--
---------- --------
---------- --------
At end of period. . . . . . . . . . . . . . . . $1,022,478 $250,692
---------- --------
---------- --------
</TABLE>
See accompanying notes to financial statements.
F-3
<PAGE>
INPUT/OUTPUT, INC. EMPLOYEE STOCK PURCHASE PLAN
NOTES TO FINANCIAL STATEMENTS
(1) DESCRIPTION OF PLAN:
The following brief description of the Input/Output, Inc. Employee
Stock Purchase Plan ("the Purchase Plan") is provided for general
information purposes only. Participants should refer to the Purchase Plan
for complete information regarding the Purchase Plan's definitions,
benefits, eligibility and other matters.
(a) GENERAL
The Purchase Plan was approved by the Input/Output, Inc. (the Company)
Board of Directors in March, 1997 and commenced on April 1, 1997. The
Stockholders of the Company approved the Purchase Plan on September 29,
1997. There are 1.5 million shares of Common Stock of the Company reserved
for issuance under the Purchase Plan.
The Purchase Plan is intended to advance the long-term interests of
the Company by encouraging the acquisition and ownership of capital stock
of the Company by employees of the Company. The Purchase Plan is intended
to qualify as an "employee stock purchase plan" under Section 423 of the
Internal Revenue Code (the Code) of 1986, as amended.
(b) ELIGIBILITY
An "eligible employee" under the Purchase Plan is a person who (i) is
actively employed (ii) is actively employed on the first day of the
calendar month prior to an offering period and (iii) is not excluded
pursuant to the following sentence. The following persons shall not be
eligible: (1) employees whose customary employment is twenty (20) hours or
less per week, (2) employees who have not been employed for at least six
months prior to the beginning of an Offering Period, and (3) an employee
who owns 5% or more of the Company's Common Stock.
(c) CONTRIBUTIONS
The Purchase Plan allows all eligible employees to authorize payroll
deductions at the rate of 1% up to 15% of base compensation to be applied
toward the purchase of Input/Output, Inc. Common Stock. The Purchase Price
of the Common Stock will be the lesser of 85% of the closing price on the
first day of the applicable Offering Period or most recently preceding
trading day or 85% of the closing price on the last day of the Offering
Period or most recently preceding trading day. Under the Purchase Plan,
separate six-month offering periods commence on April 1st and October 1st
of each year.
F-4
<PAGE>
INPUT/OUTPUT, INC. EMPLOYEE STOCK PURCHASE PLAN
NOTES TO FINANCIAL STATEMENTS - (CONTINUED)
(d) PARTICIPANT ACCOUNTS
A Purchase Plan account in the name of each participant will be
maintained. On each pay day a participant's payroll deduction shall be
withheld and credited to such account. As of the last day of the Offering
Period the amount then in the participant's account shall be applied to the
purchase of the Company's Common Stock. The purchase of stock will be made
solely from amounts credited to the participant's plan account. The total
number of employees participating in the purchase plan as of June 30, 1998
and 1997 was 401 and 378, respectively.
(e) DISTRIBUTIONS
A participant may request in writing the sale of all or part of the
shares of Common Stock in such participant's plan account. The shares will
be sold within five business days, and the Purchase Plan will deliver to
the participant the proceeds of the sale, less a handling charge, brokerage
commissions, and other costs of sale.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Plan are presented on the accrual basis
of accounting.
Investments in Company Stock are reported at fair value determined by
reference to quoted market prices. Net realized gains and losses on
disposition of investments are reported on the revalued cost method. Revalued
cost is the fair value of the assets at the beginning of the Plan year or
historical cost if the investment was acquired since the beginning of the
year. Any unrealized appreciation or depreciation is recognized as a gain or
loss currently in the statement of changes in net assets available for
benefits.
(3) FEDERAL INCOME TAXES
The Purchase Plan and the right of participants to make purchases
thereunder are intended to qualify under the provision of Section 423 of the
Code. Under those provisions, no income will be taxable to a participant at
the time of the grant of the option or purchase of shares for federal income
tax purposes. However, a participant may become liable for tax upon
dispositions of shares acquired, and the tax consequences will depend on how
long a participant has held the shares prior to disposition.
F-5
<PAGE>
INPUT/OUTPUT, INC. EMPLOYEE STOCK PURCHASE PLAN
NOTES TO FINANCIAL STATEMENTS - (CONTINUED)
(4) ADMINISTRATION OF PLAN ASSETS
The Purchase Plan's investment in shares of Input/Output, Inc. Common
Stock are held in safekeeping as designated by Harris Trust, Inc.
("Registrar"). Cash contributions to the Purchase Plan are held by the
Company prior to the investment in Input/Output, Inc. Common Stock. Certain
administrative functions are performed by officers or employees of the
Company or Registrar. No such officers or employees receive compensation from
the Purchase Plan. All administrative expenses of the Purchase Plan are borne
by the Company.
(5) PLAN TERMINATION
The Purchase Plan will terminate (a) on the date all shares authorized
for sale under the Purchase Plan have been purchased or (b) at any time, at
the discretion of the Board of Directors of the Company; provided however,
that no termination shall affect outstanding offerings of shares.
Upon termination of the Purchase Plan and the exercise or lapse of all
Offering rights thereunder all remaining amounts credited to the Purchase
Plan accounts of participants shall be returned to such participants in cash
without interest. At this time, there is no intention to terminate the
Purchase Plan.
(6) INVESTMENTS
The investments, at June 30, 1998 and 1997, are presented in the
following table:
<TABLE>
<CAPTION>
June 30,
-----------------------
1998 1997
-------- --------
<S> <C> <C>
Shares of Input/Output, Inc. Common Stock
Number of shares . . . . . . . . . . . . . . . 42,721 --
-------- --------
-------- --------
Average cost . . . . . . . . . . . . . . . . . $651,495 $ --
-------- --------
-------- --------
Market . . . . . . . . . . . . . . . . . . . . $760,968 $ --
-------- --------
-------- --------
</TABLE>
F-6