GULFSLOPE ENERGY, INC. - 8-K


Exhibit 10.2


 


EXECUTION VERSION


 





NEITHER THIS WARRANT, NOR THE SECURITIES
ISSUABLE UPON EXERCISE OF THIS WARRANT (COLLECTIVELY, THE “SECURITIES”), HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES OR BLUE SKY LAWS. THE SECURITIES ARE
SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED
EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES OR BLUE SKY LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. THE COMPANY MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY TO THE EFFECT
THAT ANY PROPOSED TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES OR BLUE SKY LAWS. THIS
WARRANT IS SUBJECT TO THE TRANSFER RESTRICTIONS SET FORTH HEREIN


 


GULFSLOPE ENERGY, INC.


 


Form
Of Warrant To Purchase Common Stock


 


Warrant No.: 


Number of Shares of Common Stock: 


Date of Issuance: (“Issuance Date”)


 


GulfSlope Energy, Inc.,
a Delaware corporation (the “Company”), hereby certifies that, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, DELEK GOM INVESTMENTS, LLC, the registered holder hereof or its permitted assigns
(the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, at the Exercise
Price (as defined below) then in effect, at any time or times on or after the Issuance Date, but not after 11:59 p.m., New York
time, on the Expiration Date, (as defined below), up to [●] fully paid nonassessable shares of Common Stock (as defined below),
subject to adjustment as provided herein (the “Warrant Shares”). Except as otherwise defined herein, capitalized
terms in this Warrant to Purchase Common Stock (including any Warrants to Purchase Common Stock issued in exchange, transfer or
replacement hereof, this “Warrant”), shall have the meanings set forth in Section 17.


 


This Warrant was issued
pursuant to that certain Term Loan Agreement, dated as of March 1, 2019 (as may be amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof, the “Term Loan Agreement”), by and between
the Company and Holder, and in conjunction with a registration rights agreement with respect to the Warrant Shares (as modified
from time to time in accordance with the terms thereof, the “Registration Rights Agreement”) to be entered into
by the Company and the Holder within twenty-one (21) days of the Issuance Date.


 


1.            EXERCISE
OF WARRANT.


 


(a)       Mechanics
of Exercise. Subject to the terms and conditions hereof, this Warrant may be exercised by the Holder at any time on or after
the Issuance Date, in whole, by (i) delivery (whether via facsimile, electronic mail or otherwise) of a written notice, in the
form attached hereto as Exhibit A (the “Exercise Notice”), of the Holder’s election to exercise
this Warrant and (ii) (A) payment to the Company of an amount equal to the Exercise Price in effect on the date of such exercise
multiplied by the number of Warrant Shares then issuable under this Warrant (the “Aggregate Exercise Price”)
in cash by wire transfer of immediately available funds (a “Cash Exercise”) or (B) if the provisions of Section
1(c) are applicable, by notifying the Company that this Warrant is being exercised pursuant to a Loan Reduction Exercise (as defined
in Section 1(c)). The Holder shall not be required to deliver the original Warrant in order to effect an exercise hereunder, nor
shall any ink-original signature or medallion guarantee (or other type of guarantee or notarization) with respect to any Exercise
Notice be required. On or before the first Trading Day following the date on which the Company has received the


 



    


     


    

 


applicable Exercise
Notice, the Company shall transmit by facsimile or electronic mail an acknowledgment of confirmation of receipt of the Exercise
Notice, in the form attached to the Exercise Notice, to the Holder and the Company’s transfer agent (the “Transfer
Agent”). (i) In the case of a Cash Exercise, (A) so long as the Holder delivers the Aggregate Exercise Price on or prior
to the second Trading Day following the date on which the Exercise Notice has been delivered to the Company, then on or prior to
the third Trading Day following the date on which the Exercise Notice has been delivered to the Company, or (B) if the Holder does
not deliver the Aggregate Exercise Price on or prior to the second Trading Day following the date on which the Exercise Notice
has been delivered to the Company, then on or prior to the second Trading Day following the date on which the Aggregate Exercise
Price is delivered, or (ii) in the case of a Loan Reduction Exercise, on or prior to the third Trading Day following the date on
which the Exercise Notice has been delivered to the Company, the Company shall cause the Transfer Agent to register by book entry,
as described in Section 1(g) below, the transfer and delivery of the Warrant Shares issuable to the Holder upon such exercise and
deliver to the Holder an Ownership Notice (as defined in Section 1(g)) relating to such Warrant Shares. Notwithstanding the preceding
sentence, in the event the Holder exercises the Warrant in connection with a pending sale transaction of the Warrant Shares issuable
to the Holder upon such exercise, the Company shall use commercially reasonable efforts to cause the Transfer Agent to register
such transfer and effect delivery of the Warrant Shares no later than the Trading Day on which the Company has received the Exercise
Notice and Aggregate Exercise Price (in the case of a Cash Exercise). Upon delivery of the Exercise Notice and Aggregate Exercise
Price (in the case of a Cash Exercise) to the Company, the Holder shall be deemed for all corporate purposes to have become the
holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date registration
of such Warrant Shares in the Holder’s name or delivery of the Ownership Notice in respect thereof to Holder occurs. The
Company shall pay any stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of
the Transfer Agent) which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant.
The Company’s obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the conditions
hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or
consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same,
or any setoff, counterclaim or recoupment; provided, however, that the Company shall not be required to deliver Warrant
Shares with respect to a Cash Exercise prior to the Holder’s delivery of the Aggregate Exercise Price. All Warrant Shares
issued upon the exercise of this Warrant pursuant to the terms hereof shall be validly issued, fully paid and non-assessable, issued
without violation of any preemptive or similar rights of any stockholders of the Company and free and clear of all liens imposed
by or through the Company.


 


(b)       Exercise
Price. For purposes of this Warrant, “Exercise Price” means $0.042, subject to adjustment as provided
herein.


 


(c)       Loan
Reduction Exercise. In lieu of paying the Aggregate Exercise Price in cash, Holder, at its option, may exercise this Warrant
in whole through an extinguishment of the then outstanding Obligations (as defined in the Term Loan Agreement) of the Company in
accordance with Section 2.10(b) of the Term Loan Agreement (a “Loan Reduction Exercise”).


 


The parties hereto intend that for all
applicable income tax purposes, the Loan Reduction Exercise of this Warrant shall be treated by the parties as a deemed Cash Exercise
of the Warrant by the Holder followed by a payment on the Loans (as defined in the Term Loan Agreement) by the Company in an amount
equal to the Aggregate Exercise Price. Unless otherwise required by applicable tax law at the time this Warrant is exercised or
by a “determination” as defined in Section 1313 of the Code, the Company and the Holder shall not take any actions
or positions that are inconsistent with the preceding sentence.


 


(d)       Disputes.
In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the
Company shall promptly issue to the Holder


 



    


     


    

 


the number of Warrant Shares that are not disputed and resolve such dispute in accordance
with Section 11.


 


(e)       No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share that the Holder would otherwise be entitled to purchase upon such exercise, the
Company shall pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise
Price.


 


(f)        Exchange
Act Filings. The Holder agrees and acknowledges that it shall have sole responsibility for making any applicable filings with
the U.S. Securities and Exchange Commission (the “SEC”) pursuant to Sections 13 and 16 of the Exchange Act as
a result of its acquisition of any Warrant and the Warrant Shares and any future retention or transfer thereof.


 


(g)       Book
Entry; Ownership Notice. Any Warrant Shares issued hereunder shall be in uncertificated, book-entry form, as permitted by the
Company’s Bylaws and the Delaware General Corporation Law. The Transfer Agent shall maintain the register for the Common
Stock and such book-entry system. Upon any exercise of this Warrant, the Company shall deliver (or cause the Transfer Agent to
deliver) to the Holder a screen shot of the Transfer Agent’s records or such other instrument as the Transfer Agent shall
typically issue in such circumstance indicating the registration of transfer to the Holder by book entry of the number of shares
of Common Stock issuable to the Holder upon such exercise of the Warrant (an “Ownership Notice”). The Transfer
Agent’s records and any Ownership Notices shall contain the legend set forth in Section 18(d) (or an equivalent notation
reflecting the transfer restrictions described in such legend) until such time as the legend may be removed in accordance with
Section 18(d).


 


(h)       Reservation
of Warrant Shares. The Company covenants that it will at all times reserve and keep available out of the aggregate of its authorized
but unissued and otherwise unreserved Common Stock, solely for the purpose of enabling it to issue Warrant Shares upon exercise
of this Warrant as herein provided, the number of shares of Common Stock which are then issuable and deliverable upon the exercise
of this entire Warrant. The Company covenants that all shares of Common Stock so issuable and deliverable shall, upon issuance
and the payment of the applicable Exercise Price in accordance with the terms hereof, be duly and validly authorized, issued and
fully paid and nonassessable. If, notwithstanding the foregoing, and not in limitation thereof, at any time while this Warrant
remains outstanding the Company does not have a sufficient number of authorized and unreserved shares of Common Stock to satisfy
its obligation to reserve for issuance upon exercise of this Warrant at least a number of shares of Common Stock (the “Required
Reserve Amount”) equal to the maximum number of shares of Common Stock as shall from time to time be necessary to effect
the exercise of all this Warrant (without regard to any limitations on exercise contained herein) (an “Authorized Share
Failure”), then the Company shall promptly take all action necessary to increase the Company’s authorized shares
of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount for this entire Warrant. Without
limiting the generality of the foregoing sentence, to the extent necessary to remedy the Authorized Share Failure, as soon as practicable
after the date of the occurrence of an Authorized Share Failure, but in no event later than 75 days after the occurrence of such
Authorized Share Failure, the Company shall hold a meeting of its stockholders for the approval of an increase in the number of
authorized shares of Common Stock. In connection with such meeting, the Company shall provide each stockholder with a proxy statement
and use its best efforts to solicit its stockholders’ approval of such increase in authorized shares of Common Stock and
shall cause its board of directors to recommend to the stockholders that they approve such proposal. Notwithstanding the foregoing,
if any such time of an Authorized Share Failure, the Company is able to obtain the written consent of a majority of the shares
of its issued and outstanding shares of Common Stock to approve the increase in the number of authorized shares of Common Stock,
the Company may satisfy this obligation by obtaining such


 



    


     


    

 


consent and submitting for filing with the SEC an Information Statement
on Schedule 14C. The Company shall not effect any subdivision (by way of stock split, stock dividend, recapitalization or otherwise)
of its outstanding Common Stock into a greater number of shares of Common Stock which would result, pursuant to Section 2(a), in
a reduction of the Exercise Price below the par value of the shares of Common Stock then in effect unless on or prior to such subdivision
or action the par value of such shares of Common Stock is reduced to the extent necessary (or another adjustment reasonably acceptable
to the Required Holders and the Company is made) to permit the adjustments under Section 2(a) which would otherwise be made in
connection therewith, but for the restriction of Section 2(b), and to permit the Warrants to be exercised into Warrant Shares that
are fully paid after giving effect to such adjustments.


 


2.            ADJUSTMENT
OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES.


 


(a)       Adjustment
Upon Subdivision or Combination of Shares of Common Stock. If the Company at any time on or after the Issuance Date subdivides
(by any stock split, stock dividend, recapitalization or otherwise) its outstanding shares of Common Stock into a greater number
of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the number of
Warrant Shares will be proportionately increased. If the Company at any time on or after the Issuance Date combines (by combination,
reverse stock split or otherwise) its outstanding shares of Common Stock into a smaller number of shares, the Exercise Price in
effect immediately prior to such combination will be proportionately increased and the number of Warrant Shares will be proportionately
decreased. Any adjustment under this Section 2(a) shall become effective at the close of business on the date the subdivision or
combination becomes effective.


 


(b)       Par
Value. Notwithstanding anything to the contrary in this Warrant, in no event shall the Exercise Price be reduced below the
par value of the Company’s Common Stock.


 


(c)       Special
Distributions. In case the Company shall declare a dividend or make any other distribution (excluding dividends payable in
shares of its Common Stock and other dividends or distributions referred to in Section 2(a)), including, without limitation, in
property or assets, to all holders of Common Stock (a “Non-Cash Distribution”), then the board of directors
of the Company shall make provision so that upon the exercise of the Warrant, the Holder or the Holder’s subsequent permitted
transferee(s) shall be entitled to receive such dividend or distribution that the Holder would have received had the Warrant been
exercised in whole immediately prior to the record date for such dividend or distribution. In case the Company shall declare a
dividend or make any other distribution in cash or cash equivalents to all holders of Common Stock (a “Cash Distribution”
and together with a Non-Cash Distribution, a “Special Distribution”), then the Exercise Price in effect immediately
prior to such Cash Distribution will be reduced by the per share amount of any such Cash Distribution. When a Special Distribution
is made, the Company shall promptly notify the Holder of such event in writing and the dividend or other distribution that the
Holder is entitled to receive.


 


(d)       Voluntary
Adjustment By Company. The Company may at any time during the term of this Warrant reduce the then current Exercise Price to
any amount and for any period of time deemed appropriate by the Board of Directors of the Company.


 


(e)       Adjustment
for Outstanding Obligations at Exercise Notice Date. If at the time the Holder exercises this Warrant in whole and the number
of Warrant Shares then issuable under the Warrant (prior to any adjustment pursuant to this Section 2(e)) is not equal to the quotient
of the Obligations (as defined in the Term Loan Agreement) of the Company outstanding under the Term Loan Agreement at the date
of the Exercise Notice (the “Exercise Notice Date”) divided by $0.042 (such quotient, the “Exercise
Shares”), then the number of Warrant Shares issuable under this Warrant shall be


 



    


     


    

 


increased or decreased as necessary
for the Warrant Shares issuable upon exercise of the Warrant as of the Exercise Notice Date to be equal to the Exercise Shares.


 


3.            FUNDAMENTAL
TRANSACTIONS. Prior to the occurrence of any Fundamental Transaction, the Company shall make appropriate provision to ensure
that the Successor Entity shall deliver upon exercise of this Warrant, in lieu of the shares of the Common Stock (or other securities,
cash, assets or other property purchasable upon the exercise of the Warrant prior to such Fundamental Transaction), such shares
of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase or subscription rights),
if any, that the Holder would have been entitled to receive upon the happening of such Fundamental Transaction had this Warrant
been exercised immediately prior to the record date for such Fundamental Transaction, as adjusted in accordance with the provisions
of this Warrant. Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and be substituted
for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring to the “Company”
shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the
obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named as the Company herein.
Upon consummation of the Fundamental Transaction, the Successor Entity shall deliver to the Holder confirmation that there shall
be issued upon exercise of this Warrant at any time after the consummation of the Fundamental Transaction, in lieu of the shares
of the Common Stock (or other securities, cash, assets or other property purchasable upon the exercise of the Warrant prior to
such Fundamental Transaction), such shares of stock, securities, cash, assets or any other property whatsoever (including warrants
or other purchase or subscription rights), if any, that the Holder would have been entitled to receive upon the happening of such
Fundamental Transaction had this Warrant been exercised immediately prior to the record date for such Fundamental Transaction,
as adjusted in accordance with the provisions of this Warrant. In addition to and not in substitution for any other rights hereunder,
prior to the consummation of any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive
securities or other assets with respect to or in exchange for shares of Common Stock (a “Corporate Event”),
the Company shall make appropriate provision to ensure that the Holder will thereafter have the right to receive upon an exercise
of this Warrant in whole within 90 days after the consummation of the Fundamental Transaction but, in any event, prior to the Expiration
Date, in lieu of the shares of the Common Stock (or other securities, cash, assets or other property) purchasable upon the exercise
of the Warrant prior to such Fundamental Transaction, such shares of stock, securities, cash, assets or any other property whatsoever
(including warrants or other purchase or subscription rights) which the Holder would have been entitled to receive upon the happening
of such Fundamental Transaction had the Warrant been exercised in whole immediately prior to the record date for such Fundamental
Transaction. The provisions of this Section 3 shall apply similarly and equally to successive Fundamental Transactions and Corporate
Events and any adjustment under this Section 3 shall be without duplication for any adjustment or distribution made under Section
2.


 


4.            NO
DUPLICATIVE ADJUSTMENT; LIMIT ON ADJUSTMENTS. Any adjustments or distribution rights under any provision of Sections 2 or 3
shall be made without duplication for any other adjustment under any other provision of Section 2 or 3. In addition, if the Holder
or the Company reasonably believes, based on the written opinion of legal counsel, that any regulatory or stockholder approval,
including under applicable antitrust laws or applicable rules and regulations of any national securities exchange or over-the-counter
market on which the Common Stock is listed for trading, is required prior to the Holder acquiring any securities or other property
to which it is entitled, the Holder or the Company may delay such issuance to the Holder until such approval has been obtained
(or, in the case of applicable antitrust laws, the required filings have been completed and any applicable waiting period has expired).
The Company shall use commercially reasonable efforts to comply promptly with all applicable regulatory requirements related to
obtaining such approvals.


 






    


     


    




 


5.            NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation or Bylaws,
or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issuance or sale
of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this
Warrant, and will at all times in good faith carry out all of the provisions of this Warrant and take all action as may be required
to protect the rights of the Holder. Without limiting the generality of the foregoing, the Company (i) shall not increase the par
value of any shares of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii)
shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid
and nonassessable shares of Common Stock upon the exercise of this Warrant, and (iii) shall, so long as any of the Warrants are
outstanding, take all action necessary to reserve and keep available out of its authorized and unissued shares of Common Stock,
solely for the purpose of effecting the exercise of the Warrants, the number of shares of Common Stock as shall from time to time
be necessary to effect the exercise of the Warrants then outstanding (without regard to any limitations on exercise).


 


 6.           WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person’s
capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of capital stock
of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in
such Person’s capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to
vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock,
consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise,
prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise
of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to
purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities
are asserted by the Company or by creditors of the Company. Notwithstanding this Section 6, the Company shall provide the Holder
with copies of the same notices and other information given to the stockholders of the Company generally, contemporaneously with
the giving thereof to the stockholders.


 


7.            REGISTRATION
AND REISSUANCE OF WARRANTS.


 


(a)       Registration
of Warrant. The Company shall register this Warrant, upon the records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat
the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to
the Holder, and for all other purposes, absent actual notice to the contrary. The Company shall also register any transfer, exchange,
reissuance or cancellation of any portion of this Warrant in the Warrant Register.


 


(b)       Transfer
of Warrant. Subject to the terms and conditions hereof, including the restrictions on transfer set forth in Section 7(c), this
Warrant and all rights hereunder are transferable, in whole or in part, without charge to the Holder, upon surrender of this Warrant
with a properly executed assignment (in the form attached hereto as Exhibit B) at the principal office of the Company. Any
transfer or assignment of this Warrant (and the Warrant Shares issuable upon exercise of this Warrant) shall be made only in compliance
with all applicable securities laws and, if requested by the Company, following delivery to the Company of a legal opinion reasonably
satisfactory to the Company confirming such compliance. If this Warrant is to be transferred in accordance with the terms hereof,
the Holder shall (i) surrender this Warrant to the Company together with all applicable transfer taxes, whereupon the Company will
promptly issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(f)), registered as the Holder
may request, representing the right to purchase the


 



    


     


    

 


number of Warrant Shares being transferred by the Holder and, if less than
the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section
7(e)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred and (ii) provide advance
written notice to the Company of the Warrant being transferred, the name and notice details of the transferee and an instrument
duly executed by the transferee whereby such transferee makes the representations set forth in Section 18 of this Warrant and agrees
to be bound by all obligations of the Holder under this Warrant. Any transfer of the Warrant or Warrant Shares which is not made
in accordance with the terms of this Section 7 shall be void.


 


(c)       Restrictions
on Transfer. The Warrant and the Warrant Shares issuable and deliverable upon exercise of this Warrant may be transferred or
assigned to any Person without the consent of the Company; provided that any such transferee shall agree in writing to be bound
by all obligations of the Holder under this Warrant.


 


(d)       Lost,
Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by
the Holder to the Company in customary form or the provision of reasonable security by the Holder to the Company and, in the case
of mutilation, upon surrender and cancellation of this Warrant, the Company shall execute and deliver to the Holder a new Warrant
(in accordance with Section 7(f)) representing the right to purchase the Warrant Shares then underlying this Warrant.


 


(e)       Exchangeable
for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the
Company together with all applicable transfer taxes, for a new Warrant or Warrants (in accordance with Section 7(f)) representing
in the aggregate the right to purchase the number of Warrant Shares then underlying this Warrant, and each such new Warrant will
represent the right to purchase such portion of such Warrant Shares as is designated by the Holder at the time of such surrender;
provided, however, that the Company shall not be required to issue Warrants for fractional shares of Common Stock hereunder.


 


(f)        Issuance
of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant
shall (i) be of like tenor with this Warrant, (ii) represent, as indicated on the face of such new Warrant, the right to purchase
the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(b) or Section
7(d), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other
new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant),
(iii) have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date and (iv) have
the same rights and conditions as this Warrant.


 


8.            NOTICES. Whenever
notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance
with the information set forth in the Warrant Register. The Company shall provide the Holder with prompt written notice of all
actions taken pursuant to this Warrant, including, in reasonable detail, a description of such action and the reason or reasons
therefore. Without limiting the generality of the foregoing, the Company will give written notice to the Holder following any
adjustment of the Exercise Price or Warrant Shares issuable upon exercise hereof, setting forth in reasonable detail, and certifying,
the calculation of such adjustment.


 


9.            AMENDMENT
AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended or waived and the Company may
take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained
the written consent of the Required Holders. Any amendment or waiver approved by the


 



    


     


    

 


Required Holders and any other approval or
consent granted by the Required Holders hereunder shall be effective and binding on all current and future holders of the Warrant.


 


10.          GOVERNING
LAW; JURISDICTION; JURY TRIAL. This Warrant shall be governed by and construed and enforced in accordance with, and all questions
concerning the construction, validity, interpretation and performance of this Warrant shall be governed by, the internal laws
of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State
of New York. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The
City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is improper. The Company hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof
to the Company at the address set forth on the signature page for the Company below or such other address as the Company subsequently
delivers to the Holder and agrees that such service shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing
contained herein shall be deemed or operate to preclude the Holder from bringing suit or taking other legal action against the
Company in any other jurisdiction to collect on the Company’s obligations to the Holder, to realize on any collateral or
any other security for such obligations, or to enforce a judgment or other court ruling in favor of the Holder. THE COMPANY
HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER
OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.


 


11.          DISPUTE
RESOLUTION. Any dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares must
be raised by the Required Holders or the Company. In the case of any such dispute, the Company shall submit the disputed determinations
or arithmetic calculations, as the case may be, to the Holder, via facsimile within two Trading Days of receipt of the Exercise
Notice giving rise to such dispute. If the Required Holders and the Company are unable to agree upon such determination or calculation
of the Exercise Price or the Warrant Shares within five Trading Days of such disputed determination or arithmetic calculation being
submitted to the Holder, then the Company and the Holder shall, within two Trading Days submit via facsimile their respective disputed
determinations of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Required
Holders. The Company shall cause the investment bank to perform the determinations or calculations and notify the Company and the
Holder of the results no later than ten Trading Days from the time it receives the disputed determinations or calculations. Such
investment bank’s determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable
error. The expenses of the investment bank will be borne equally by the Holder and the Company. Nothing in this Section 11 shall
be deemed to modify or mitigate the terms of Section 1(d) hereof.


 


12.          REMEDIES,
OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative and in addition
to all other remedies available under this Warrant, at law or in equity (including a decree of specific performance and/or other
injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual damages for any failure by the Company
to comply with the terms of this Warrant. The Company acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that,
in the event of any such 


 






     


     


    

 


breach
or threatened breach, the holder of this Warrant shall be entitled, in addition to all other available remedies, to seek an injunction
restraining any breach, without the necessity of showing economic loss and without any bond or other security being required.


 


13.          LIMITATION
ON LIABILITY. No provisions hereof, in the absence of affirmative action by the Holder to purchase Warrant Shares hereunder,
shall give rise to any liability of the Holder to pay the Exercise Price or as a stockholder of the Company (whether such liability
is asserted by the Company or creditors of the Company).


 


14.          SUCCESSORS
AND ASSIGNS. This Warrant shall bind and inure to the benefit of and be enforceable by the Company and the Holder and their
respective successors and permitted assigns.


 


15.          SEVERABILITY;
CONSTRUCTION; HEADINGS. If any provision of this Warrant is prohibited by law or otherwise determined to be invalid or unenforceable
by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed
amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such
provision shall not affect the validity of the remaining provisions of this Warrant so long as this Warrant as so modified continues
to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited
nature, invalidity or unenforceability of the provisions(s) in question does not substantially impair the respective expectations
or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the
parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provisions(s)
with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provisions(s).
This Warrant shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any person
as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or affect the
interpretation of, this Warrant.


 


16.          [Reserved].


 


17.          CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:


 


(a)       “Affiliate”
means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries controls, is
controlled by or is under common control with, the Person in question. As used herein, the term “control” means the
possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether
through ownership of voting securities, by contract or otherwise. For the avoidance of doubt, for purposes of this Warrant, the
Company, on the one hand, and the Holder, on the other, shall not be considered Affiliates.


 


(b)       “Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are
authorized or required by law to remain closed.


 


(c)       “Common
Stock” means (i) the Company’s common stock, $0.001 par value per share, and (ii) any capital stock into which
such Common Stock shall have been changed or any share capital resulting from a reclassification of such Common Stock.


 


(d)       “Eligible
Market” means the Principal Market, the OTC QX, the NYSE American, The Nasdaq Global Select Market, The Nasdaq Global
Market, The Nasdaq Capital Market or The New York Stock Exchange, Inc.


 






    


     


    




 


(e)       “Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations at the SEC promulgated
thereunder.


 


(f)        “Expiration
Date” means the March 4, 2020 or, if such date falls on a day other than a Business Day or on which trading does
not take place on the Principal Market (a “Holiday”), the next day that is not a Holiday.


 


(g)       “Fundamental
Transaction” means that, after the Issuance Date, the Company shall, directly or indirectly, in one or more related
transactions, (i) consolidate or merge with or into another Person, (ii) sell, assign, transfer, convey or otherwise dispose of
all or substantially all of the properties or assets of the Company to another Person, (iii) allow another Person to make a purchase,
tender or exchange offer that is accepted by the holders of more than 50% of the outstanding shares of Common Stock (not including
any shares of Common Stock held by the Person or Persons making or party to, or associated or affiliated with the Persons making
or party to, such purchase, tender or exchange offer), (iv) consummate a stock purchase agreement or other business combination
(including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person whereby
such other Person acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held
by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to,
such stock purchase agreement or other business combination immediately prior to such stock purchase or business combination),
(v) reorganize, recapitalize or reclassify its Common Stock or (vi) any “person” or “group” (as these terms
are used for purposes of Sections 13(d) and 14(d) of the Exchange Act), other than the Company, the Holder or any Related Party
thereof, is or shall become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock (excluding any debt securities
convertible into equity) normally entitled to vote in the election of directors (“Voting Stock”) of the Company
(or its successor by merger, consolidation or purchase of all or substantially all of its assets) (for purposes of this clause,
such person or group shall be deemed to beneficially own any Voting Stock held by a Parent Entity, if such person or group “beneficially
owns” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, more than 50% of the voting power of the
Voting Stock of such Parent Entity) or 50% of the aggregate economic interests in the Company (or its successor by merger, consolidation
or purchase of all or substantially all of its assets).


 


(h)       “Group”
means a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.


 


(i)        “Parent
Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common
stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent
Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental
Transaction.


 


(j)        “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.


 


(k)       “Principal
Market” means OTC Markets (QB Marketplace Tier).


 


(l)        “Related
Party” means, with respect to any specified Person, such Person’s affiliates and the respective directors,
officers, employees, agents and advisors of such Person and such Person’s affiliates.


 






    


     


    




 


(m)      “Required
Holders” means holders of the Warrants representing at least a majority of shares of Common Stock underlying the
Warrants then outstanding.


 


(n)       “Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations at the SEC promulgated thereunder.


 


(o)       “Successor
Entity” means one or more Person or Persons (or, if so elected by the Required Holders, the Parent Entity) formed
by, resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Required
Holders, the Parent Entity) with which such Fundamental Transaction shall have been entered into.


 


(p)       “Trading
Day” means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not
the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the
Common Stock is then traded.


 


18.          REPRESENTATIONS
AND WARRANTIES. The Holder represents, warrants and covenants to the Company as follows:


 


(a)       Accredited
Investor Status; Sophisticated Purchaser. The Holder is an “accredited investor” within the meaning of Rule 501
under the Securities Act and is able to bear the risk of its investment in this Warrant and the Warrant Shares issuable and deliverable
upon exercise of this Warrant. The Holder has such knowledge and experience in financial and business matters that it is capable
of evaluating the merits and risks of the purchase of this Warrant and the Warrant Shares issuable and deliverable upon exercise
of this Warrant.


 


(b)       Information.
The Holder has been afforded the opportunity to ask questions of, and obtain information from, the Company. The Holder understands
that its acquisition of this Warrant and the Warrant Shares issuable and deliverable upon exercise of this Warrant involves a high
degree of risk. The Holder has sought such accounting, legal and tax advice as it has considered necessary to make an informed
investment decision with respect to its acquisition of this Warrant and the Warrant Shares issuable and deliverable upon exercise
of this Warrant.


 


(c)       Filings.
The Holder shall cooperate reasonably with the Company (at the Company’s sole cost and expense) to provide any information
necessary for any applicable securities filings of the Company.


 


(d)       Legends.
The Holder understands that, until such time, if any, as the Warrant or the Warrant Shares issuable and deliverable upon exercise
of this Warrant have been registered pursuant to the provisions of the Securities Act, or the Warrant or Warrant Shares issuable
and deliverable upon exercise of this Warrant are eligible for resale pursuant to Rule 144 promulgated under the Securities Act
without any restriction as to the number of securities as of a particular date that can then be immediately sold, or as provided
in this Section 18(d), the Warrant (and any Warrant Shares) will bear the following restrictive legend (in addition to any legend
required under applicable state securities laws):


 


THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER
ANY STATE SECURITIES OR BLUE SKY LAWS. THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE
OFFERED, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND APPLICABLE STATE


 



    


     


    

 


SECURITIES OR BLUE SKY LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE COMPANY MAY REQUIRE AN OPINION OF COUNSEL IN
FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY TO THE EFFECT THAT ANY PROPOSED TRANSFER IS IN COMPLIANCE WITH THE SECURITIES
ACT AND ANY APPLICABLE STATE SECURITIES OR BLUE SKY LAWS. TRANSFER OF THE SECURITIES IS ALSO IS SUBJECT TO THE TRANSFER RESTRICTIONS
SET FORTH IN A WARRANT DATED MARCH 4, 2019, A COPY OF WHICH IS AVAILABLE WITH THE SECRETARY OF THE COMPANY.


 


and other legends set
forth in or required by state securities laws applicable to the Holder.


 


The legend
set forth in this Section 18(d) shall be removed by the Company from the book-entry position on the Company’s register for
such Warrant or Warrant Shares upon delivery to the Company of an opinion by counsel, reasonably satisfactory to the Company, that
a registration statement under the Securities Act is at that time in effect with respect to the legended security or that such
security can be freely transferred in a public sale without such a registration statement being in effect and that such transfer
shall not jeopardize the exemption or exemptions from registration pursuant to which the Company issued the Warrant or Warrant
Shares.


 


(e)       Holder
Representation. The Holder is acquiring the Warrant and the Warrant Shares issuable and deliverable upon exercise of this Warrant
for its own account and not with a view to distribution in violation of any securities laws. The Holder has been advised and understands
that none of the Warrants or shares of Common Stock issuable upon exercise of the Warrants have been registered under the Securities
Act or under the “blue sky” laws of any jurisdiction and may be resold only if registered pursuant to the provisions
of the Securities Act (or if eligible, pursuant to the provisions of Rule 144 promulgated under the Securities Act or pursuant
to another available exemption from the registration requirements of the Securities Act). The Holder has been advised and understands
that the Company, in issuing the Warrants and any Warrant Shares issuable and deliverable upon exercise of this Warrant, is relying
upon, among other things, the representations and warranties of the Holder contained in this Section 18 in concluding that such
issuance is a “private offering” and is exempt from the registration provisions of the Securities Act.


 


(f)        Rule
144. The Holder understands that there is no public trading market for the Warrants, that none is expected to develop and that
the Warrants must be held indefinitely unless and until the Warrants are registered under the Securities Act or an exemption from
registration is available. The Holder has been advised of and is aware of the provisions of Rule 144 promulgated under the Securities
Act.


 


(g)       Reliance
by the Company. The Holder understands that the Warrants are being offered and sold in reliance on a transactional exemption
from the registration requirements of federal and state securities laws and that the Company is relying upon the truth and accuracy
of the representations, warranties, agreements, acknowledgments and understandings of the Holder set forth herein in order to determine
the applicability of such exemptions and the suitability of the Holder to acquire the Warrants.


 


19.          REGISTRATION
RIGHTS AGREEMENT. This Warrant and the Warrant Shares issuable upon exercise hereof shall be subject to the terms and conditions
of the Registration Rights Agreement to be entered into by the Company and Holder and the Holder shall be entitled to all of the
rights and subject to all of the obligations under such Registration Rights Agreement. The Warrant Shares shall be deemed “Registrable
Securities” as defined in such Registration Rights Agreement.


 


[Signature Page Follows]


 




    


     


    

 


IN WITNESS WHEREOF,
the Company has caused this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out above.


  





	 	GULFSLOPE ENERGY, INC.
	 	 	 
	 	By:	 /s/ John N. Seitz
	 	Name: John N. Seitz
	 	Title: CEO



 







    


     


    

 


EXHIBIT A


 


EXERCISE NOTICE


 


TO BE EXECUTED BY THE REGISTERED HOLDER
TO EXERCISE THIS WARRANT TO PURCHASE COMMON STOCK (THE “WARRANT”)


 


GULFSLOPE ENERGY, INC.


 


The undersigned holder
hereby exercises the right to purchase the number of shares of Common Stock issuable under the Warrant (as adjusted pursuant to
the Warrant, the “Warrant Shares”) of GulfSlope Energy, Inc., a Delaware corporation (the “Company”),
evidenced by the attached Warrant. Capitalized terms used herein and not otherwise defined shall have the respective meanings set
forth in the Warrant.


 


1.       Exercise
Price. The Holder intends that payment of the Exercise Price shall be made as:


 


____________ a “Cash
Exercise” with respect to all Warrant Shares issuable upon the exercise of the Warrant; and/or


 


____________ a “Loan
Reduction Exercise” with respect to all Warrant Shares issuable upon exercise of the Warrant.


 


2.       Payment
of Exercise Price. In the event that the holder has elected a Cash Exercise with respect to all of the Warrant Shares to be
issued pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in
accordance with the terms of the Warrant.


 


3.       Delivery
of Warrant Shares. The Company shall deliver (or cause to be delivered) to the holder __________ Warrant Shares by book entry
in accordance with the terms of the Warrant.


 


4.       Representations
and Warranties. By its delivery of this Exercise Notice, the undersigned represents and warrants to the Company that the representations
and warranties of the Holder set forth in Section 18 of the Warrant.


 


Date: _______________, ______





 


	 	 	 
	Name of Registered Holder	 
	 	 	 
	By: 	 	 
		Name:	 
		Title:	 









 




    


     


    

 


ACKNOWLEDGMENT


 


The Company hereby
acknowledges this Exercise Notice.


 





	 	GULFSLOPE ENERGY, INC.
	 	 	 
	 	By:	 
	 		Name:
	 		Title:





 




    


     


    

 


EXHIBIT B


 


FORM OF ASSIGNMENT


 


ASSIGNMENT


 


FOR VALUE RECEIVED,
__________hereby sells, assigns and transfers all of the rights of the undersigned under the attached Warrant (Warrant No. ___) with respect
to the number of shares of the Common Stock covered thereby set forth below, unto:


 


	
        Names
of Assignee 
	
        Address 
	
        No.
of Shares 

	 	 	 
	 	 	 
	 	 	 


 


	Dated:	 	Signature	 
	 	 	 	 
	 	 	Witness