Document:

Unassociated Document

Exhibit 10.1

INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT (“Agreement”) is made as of this [    ] by and between GulfSlope Energy, Inc., a Delaware corporation (the “Company”), and [        ] (“Indemnitee”).

WHEREAS, the Company and Indemnitee recognize the increasing difficulty in obtaining directors’ and officers’ liability insurance, the significant increases in the cost of such insurance and the general reductions in the coverage of such insurance;

WHEREAS, the Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting officers and directors to expensive litigation risks at the same time as the availability and coverage of liability insurance has been severely limited;

WHEREAS, the Company and Indemnitee desire to have in place the additional protection provided by an indemnification agreement, to provide indemnification and advancement of expenses to the Indemnitee to the maximum extent permitted by Delaware law; and

WHEREAS, the Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as officers and directors of the Company and to indemnify its officers and directors so as to provide them with the maximum protection permitted by law.

NOW, THEREFORE, the Company and Indemnitee hereby agrees as follows:

1.           INDEMNIFICATION.

(a)           THIRD PARTY PROCEEDINGS.  The Company shall indemnify Indemnitee if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director or officer, by reason of the fact that Indemnitee is or was a director or officer of the Corporation or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) actually incurred by Indemnitee in connection with such action or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee’s conduct was unlawful. The termination of any action or proceeding by judgment, order, settlement, conviction, or upon a plea of NOLO CONTENDERE or its equivalent, shall not, of itself, create a presumption that (i) Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Company, or (ii) with respect to any criminal action or proceeding, Indemnitee did not have reasonable cause to believe that Indemnitee’s conduct was unlawful.

(b)           PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY.  The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding by or in the right of the Company, or any subsidiary of the Company, to procure a judgment in its favor by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while an officer or director or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Company, and its stockholders, except that no indemnification shall be made in respect of any claim, issue or matters as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of Indemnitee’s duty to the Company and its stockholders unless and only to the extent that the court in which such action or proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper.

  

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2.           EXPENSES; INDEMNIFICATION PROCEDURE.

(a)           ADVANCEMENT OF EXPENSES.  The Company shall advance all expenses incurred by Indemnitee in connection with the investigation, defense, settlement, or appeal of any civil or criminal action or proceeding referenced in Section 1(a) or (b) hereof.  Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized hereby.  The advances to be made hereunder shall be paid by the Company to Indemnitee within twenty (20) days following delivery of a written request therefor by Indemnitee to the Company.

(b)           NOTICE/COOPERATION BY INDEMNITEE.  Indemnitee shall, as a condition precedent to his right to be indemnified under this Agreement, give the Company notice in writing as soon as practicable of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement, provided, however, that a delay in giving such notice shall not deprive Indemnitee of any right to be indemnified under this Agreement unless, and then only to the extent that, such delay is materially prejudicial to the defense of such claim. Notice to the Company shall be directed to the general counsel of the Company and to the Chief Executive Officer of the Company at the address shown on the signature page of this Agreement (or such other address as the Company shall designate in writing to Indemnitee).  Notice shall be deemed received three business days after the date postmarked if sent by domestic certified or registered mail, properly addressed; otherwise notice shall be deemed received when such notice shall actually be received by the Company.  In addition, Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitee’s power.

(c)           PROCEDURE.  Any indemnification provided for in Section 1 shall be made no later than forty-five (45) days after receipt of the written request of Indemnitee.  If a claim under this Agreement, under any statute, or under any provision of the Company’s Certificate of Incorporation or Bylaws providing for indemnification, is not paid in full by the Company within forty-five (45) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 of this Agreement, Indemnitee shall also be entitled to be paid for the expenses (including attorneys’ fees) of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any action or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee for the amount claimed, but the burden of providing such defense shall be on the Company, and Indemnitee shall be entitled to receive interim payments of expenses pursuant to Subsection 2(a) unless and until such defense may be finally adjudicated by court order or judgement from which no further right of appeal exists. It is the parties’ intention that if the Company contests Indemnitee’s right to indemnification, the question of Indemnitee’s right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct.

  

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(d)           NOTICE TO INSURERS.  If, at the time of the receipt of a notice of a claim pursuant to Section 2(b) hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies.  The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

(e)           SELECTION OF COUNSEL.  In the event the Company shall be obligated under Section 2(a) hereof to pay the expenses of any proceeding against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indemnitee, which approval shall not be unreasonably withheld, upon the delivery to Indemnitee of written notice of its election so to do.  After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that (i) Indemnitee shall have the right employ his counsel in any such proceeding at Indemnitee’s expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, which authorization has not been revoked, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then, in the case of (A), (B), or (C) above, the fees and expenses of Indemnitee’s counsel shall be at the expense of the Company.

3.           ADDITIONAL INDEMNIFICATION RIGHTS; NONEXCLUSIVITY.

(a)           SCOPE.  Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify the Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company’s Certificate of Incorporation, the Company’s Bylaws or statute.  In the event of any change, after the date of this Agreement, in any applicable law, statute or rule which expands the right of a Delaware corporation to indemnify a member of its board of directors or an officer, such changes shall be, ipso facto, within the purview of Indemnitee’s rights and Company’s obligations, under this Agreement. In the event of any change in any applicable law, statute or rule which narrows the right of a Delaware corporation to indemnify a member of its Board of Directors or an officer, such changes, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement shall have no effect on this Agreement or the parties’ rights and obligations hereunder.

(b)           NONEXCLUSIVITY.  The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company’s Certificate of Incorporation, its Bylaws, any agreement, any vote of stockholders or disinterested directors, the general corporation laws of the State of Delaware, or otherwise, both as to action in Indemnitee’s official capacity and as to action in another capacity while holding such office.  The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even though he may have ceased to serve in such capacity at the time of any action or other covered proceeding.

  

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4.           PARTIAL INDEMNIFICATION.  If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines or penalties actually or reasonably incurred by him in the investigation, defense, appeal, or settlement of any civil or criminal action or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which Indemnitee is entitled.

5.           MUTUAL ACKNOWLEDGMENT.  Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors and officers under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company’s right under public policy to indemnify Indemnitee.

6.           DIRECTOR’S AND OFFICER’S LIABILITY INSURANCE.  The Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and maintain a policy or policies of insurance with reputable insurance companies providing the officers and directors of the Company with coverage for losses from wrongful acts, or to ensure the Company’s performance of its indemnification obligations under this Agreement.  Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage.  In all policies of directors’ and officers’ liability insurance, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company’s directors; or of the Company’s officers, if Indemnitee is not a director of the Company but is an officer.  Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that such insurance is not reasonably available, if the premium costs for such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company.

7.           SEVERABILITY.  Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law.  The Company’s inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement.  The provisions of this Agreement shall be severable as provided in this Section 7.  If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms.

8.           EXCEPTIONS.  Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement:

(a)           EXCLUDED ACTS.  To indemnify Indemnitee for any acts or omissions or transactions from which a director may not be indemnified under applicable law.

(b)           CLAIMS INITIATED BY INDEMNITEE.  To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; or

  

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(c)           LACK OF GOOD FAITH.  To indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; or

(d)           INSURED CLAIMS.  To indemnify Indemnitee for expenses or liabilities, which have been paid directly to Indemnitee by an insurance carrier under a policy of directors’ and officers’ liability insurance maintained by the Company; or

(e)           CLAIMS UNDER SECTION 16(b).  To indemnify Indemnitee for expenses and the payment of profits inuring to and recoverable by the Company pursuant to Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute.

9.           EFFECTIVENESS OF AGREEMENT.  To the extent that the indemnification permitted under the terms of certain provisions of this Agreement exceeds the scope of the indemnification provided for in the general corporation laws of the State of Delaware, such provisions shall not be effective unless and until the Company’s Certificate of Incorporation authorize such additional rights of indemnification.  In all other respects, the balance of this Agreement shall be effective as of the date set forth on the first page and may apply to acts or omissions of Indemnitee which occurred prior to such date if Indemnitee was an officer, director, employee or other agent of the Company, or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, at the time such act or omission occurred.

10.           CONSTRUCTION OF CERTAIN PHRASES.

(a)           For purposes of this Agreement, references to the “Company” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued.

(b)           For purposes of this Agreement, references to “other enterprises” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to “serving at the request of the Company” shall include, without limitation, any service as a director, officer, employee of agent of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries.

11.           COUNTERPARTS.  This Agreement may be executed in one or more counterparts, each of which shall constitute an original.

  

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12.           SUCCESSORS AND ASSIGNS.  This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee’s estate, heirs, legal representatives, and assigns.

13.           ATTORNEYS’ FEES.  In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys’ fees, incurred by Indemnitee with respect to such action, unless as a part of such action, the court of competent jurisdiction determines that each of the material assertions made by Indemnitee as a basis for such action were not made in good faith or were frivolous.  In the event of an action instituted by or in the name of the Company under this Agreement or to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all court costs and expenses, including attorneys’ fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee’s counterclaims and cross-claims made in such action), unless as a part of such action the court determines that each of the Indemnitee’s material defenses to such action were made in bad faith or were frivolous.

14.           NOTICE.  All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee, on the date of such receipt, or (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. The addresses for notice to either party are as shown on the signature page of this Agreement, as may subsequently be modified by written notice.

15.           CONSENT OF JURISDICTION.  The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of Texas for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be commenced, prosecuted and continued only in the courts of the State of Texas in and for Harris County, which shall be exclusive and only proper forum for adjudicating such a claim (except for matters for which the Delaware Court of Chancery has exclusive jurisdiction by law).

16.           CHOICE OF LAW.  This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of Delaware.

17.           INTEGRATION AND ENTIRE AGREEMENT.  This Agreement sets forth the entire understanding between the parties hereto and supersedes and merges all previous written and oral negotiations, commitments, understandings, and agreements relating to the subject matter hereof between the parties hereto.

  

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

GULFSLOPE ENERGY, INC.

By:_____________________________

Title:____________________________

Address:2500 CityWest Blvd., Suite 800

Houston, Texas 77042

AGREED TO AND ACCEPTED:

[__________________________]

By:_____________________________

Address: ________________________

_________________________

_________________________

 

 

 

 

 

 

  

7Unassociated Document

Exhibit 10.2

 

SUBSCRIPTION AGREEMENT

This SUBSCRIPTION AGREEMENT ("Agreement") is made and entered into as of the Subscription Date by and between GulfSlope Energy, Inc., a Delaware corporation ("Company"), and the Purchaser ("Purchaser") identified on the Purchaser Omnibus Signature Page attached to this Agreement.

Preliminary Statement

The Purchaser desires to purchase and the Company desires to offer and sell to the Purchaser shares of the Company's common stock, par value $0.001 per share ("Common Stock").

Agreement

The parties, intending to be legally bound, agree as follows:

SECTION 1

SALE OF SHARES

Subject to the terms of the Company’s Confidential Private Placement Memorandum, dated July 26, 2013 (the "Private Placement Memorandum"), the Purchaser will purchase from the Company the number of shares of Common Stock set forth on the Purchaser Omnibus Signature Page attached to this Agreement (such shares, the "Shares") at a price of U.S. $0.12 per Share in cash (the total price paid for such Shares, the "Total Purchase Price").  In consideration for the payment of the Total Purchase Price, the Company will issue and sell the Shares to the Purchaser.  The Purchaser understands that the Company is under no obligation to sell any Shares to the Purchaser unless the Company accepts and signs this Agreement.

SECTION 2

CLOSING; DELIVERY

2.1           Closings.

(a)           The initial closing ("Closing") of the purchase and sale of the Shares to the Purchaser hereunder shall be held at the Company's offices at 3 Riverway, Ste. 1800, Houston, Texas 77056, on or before August 30, 2013 (such date, the "Closing Date"), or at such other time and place as determined by the Company.

(b)           After the Initial Closing, the Company may sell, pursuant to this Agreement and subject to the terms of the Private Placement Memorandum, additional Shares to one or more purchasers (the "Additional Purchasers").  Each Additional Purchaser shall become a party to this Agreement and the Registration Rights Agreement in the form attached hereto as Exhibit A ("Registration Rights Agreement").  In the even there are multiple closings, the term “Closing” shall refer to each such additional closing.

2.2           Delivery.  At each Closing, the Company shall execute and deliver to Purchaser this Subscription Agreement and the Registration Rights Agreement.  At each Closing, the Purchaser shall pay the Company the Total Purchase Price in immediately available funds by wire transfer to the following account.

  

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At each Closing, the Company shall issue the shares to the Purchaser, and on or as soon as reasonably practicable after the Closing Date, the Company shall deliver or cause the delivery to each Purchaser of a stock certificate representing the Shares purchased by the Purchaser.

SECTION 3

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

The Purchaser represents and warrants to the Company with respect to this purchase as follows:

3.1           Organization and Standing.  If the Purchaser is not an individual, the Purchaser is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its organization.

3.2           Power.  The Purchaser has all requisite power and authority to execute and deliver this Agreement and the Registration Rights Agreement and to carry out and perform its obligations under the terms of this Agreement and the Registration Rights Agreement.

3.3           Authorization.  The execution, delivery, and performance of this Agreement and the Registration Rights Agreement by the Purchaser have been duly authorized by all requisite action, and this Agreement and the Registration Rights Agreement constitute legal, valid, and binding obligations of the Purchaser enforceable against the Purchaser in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, or similar laws relating to or affecting the enforcement of creditors' rights.

3.4           Consents and Approvals.  The Purchaser need not give any notice to, make any filing with, or obtain any authorization, consent, or approval (i) of any person under any instrument, contract or agreement to which the Purchaser or any of its affiliates is a party or (ii) of any government or governmental agency in order to execute and deliver this Agreement and the Registration Rights Agreement, consummate the transactions contemplated hereby and thereby and perform its obligations hereunder and thereunder.

3.5           Non-Contravention.  None of the execution and the delivery of this Agreement and the Registration Rights Agreement by the Purchaser, the consummation of the transactions contemplated hereby and thereby and the performance by the Purchaser of its obligations hereunder or thereunder will violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of any government, governmental agency or court to which the Purchaser is subject or any instrument, contract, or agreement to which the Purchaser or any of its affiliates is a party.

3.6           Purchase for Investment Only.  The Purchaser is purchasing the Shares for the Purchaser's own account for investment purposes only and not with a view to, or for resale in connection with, any "distribution" thereof for purposes of the Securities Act of 1933, as amended ("Act").  By executing this Agreement, the Purchaser further represents that it does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer, or grant participation to such person or to any third person, with respect to any of the Shares.  The Purchaser understands that the Shares have not been registered under the Act or any applicable state securities laws by reason of a specific exemption therefrom that depends upon, among other things, the bona fide nature of the Purchaser's investment intent as expressed herein.

3.7           Receipt of Information.  The Purchaser has received and had the opportunity to review a copy of the Company's Private Placement Memorandum, including the information set forth under the heading "Risk Factors" therein.  Additionally, the Purchaser has had an opportunity to review the Company's filings under the Securities Exchange Act of 1934, as amended ("Exchange Act"), incorporated by reference in the Private Placement Memorandum.  The Purchaser has received all such information that the Purchaser deems necessary and appropriate to enable the Purchaser to evaluate the financial risk inherent in making an investment in the Shares.  The Purchaser has been afforded the opportunity to ask questions of and receive answers from duly authorized officers or other representatives of the Company concerning the business and financial condition of the Company and the terms of the offering of the Shares.

  

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3.8           Risk of Investment.  The Purchaser realizes that the purchase of the Shares will be a highly speculative investment.  The Purchaser is able, without impairing the Purchaser's financial condition, to hold such Shares for an indefinite period of time and to suffer a complete loss of the Purchaser's investment.  The Purchaser understands all of the risks related to the purchase of the Shares.  By virtue of the Purchaser's experience in evaluating and investing in private placement transactions of securities in companies similar to the Company, the Purchaser is capable of evaluating the merits and risks of the Purchaser's investment in the Company and has the capacity to protect the Purchaser's own interests.

3.9           Advisors.  The Purchaser has reviewed with its own tax advisors the federal, state, and local tax consequences of this investment and the transactions contemplated by this Agreement.  The Purchaser acknowledges that it has had the opportunity to review this Agreement and the Registration Rights Agreement and the transactions contemplated by this Agreement with the Purchaser's own legal counsel.  The Purchaser is relying solely on its legal counsel and tax advisors and not on any statements or representations of the Company or any of the Company's agents for legal or tax advice with respect to this investment or the transactions contemplated by this Agreement.

3.10           Finder.  The Purchaser is not obligated and will not be obligated to pay any broker commission, finders' fee or success fee in connection with the transactions contemplated by this Agreement.

3.11           Restricted Shares.  The Purchaser understands that the Shares must be held indefinitely unless subsequently registered under the Act or unless an exemption from registration is otherwise available.  Moreover, the Purchaser understands that, except as set forth in the Registration Rights Agreement, the Company is under no obligation to register the Shares.  The Purchaser is aware of Rule 144 promulgated under the Act that permits limited resales of securities purchased in a private placement subject to the satisfaction of certain conditions.  In addition, the Company is a "shell company" as defined under Section 12b-2 of the Exchange Act, and until such time as it is no longer considered as a "shell company" in accordance with Rule 144(i), no shareholder who owns restricted securities of the Company may rely on or utilize the safe harbor resale exemption provided by Rule 144 of the Act.

3.12           Legend.  It is understood by the Purchaser that each certificate representing the Shares shall be endorsed with the following legend:

"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR ANY STATE SECURITIES OR "BLUE SKY LAWS," AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED."

  

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The Company need not register a transfer of Shares unless the conditions specified in the foregoing legend are satisfied.  The Company may also instruct its transfer agent not to register the transfer of any of the Shares unless the conditions specified in the foregoing legend are satisfied.

3.13           Removal of Legend and Transfer Restrictions.  It is understood by the Purchaser that the legend relating to the Act endorsed on a stock certificate pursuant to Subsection 3.12 of this Agreement and the stop transfer instructions with respect to the Shares represented by such certificate shall not be removed until such Shares are sold pursuant to an effective registration statement, or the holder of such Shares provides to the Company an opinion of counsel for such holder of the Shares reasonably satisfactory to the Company or a no-action letter or interpretive opinion of the staff of the Securities and Exchange Commission ("SEC") to the effect that a public sale, transfer, or assignment of such Shares may be made without registration and without compliance with any restriction such as Rule 144.  Any legend imposed by state securities laws will be removed if the state agency imposing such legend has consented to its removal.

3.14           Investor Qualification.  The Purchaser qualifies as an "accredited investor" as defined in Rule 501(a) of Regulation D under the Act.  The Purchaser acknowledges that it has completed the Confidential Prospective Purchaser Questionnaire in the form attached hereto as Exhibit B ("Purchaser Questionnaire").  The Purchaser has truthfully set forth in the Purchaser Questionnaire the factual basis or reason for qualification as an "accredited investor" as defined in Rule 501(a) of Regulation D under the Act and such information remains true and correct as of the date of execution of this Agreement and the Closing Date.  The Purchaser agrees to furnish any additional information that the Company deems necessary in order to verify the answers set forth in the Purchaser Questionnaire.

SECTION 4

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company represents and warrants to the Purchaser as follows:

4.1           Organization and Standing.  The Company is duly organized, validly existing and in good standing under the laws of the State of Delaware.  The Company has the corporate power and authority to own and operate its properties and assets and to carry on its business as presently conducted and as proposed to be conducted.  The Company is qualified to do business as a foreign entity in every jurisdiction in which the failure to be so qualified would have a material adverse effect on the Company's business as now conducted or as proposed to be conducted.

4.2           Power.  The Company has the corporate power and authority to execute and deliver this Agreement and the Registration Rights Agreement, to sell and issue the Shares hereunder and to perform its obligations under this Agreement and the Registration Rights Agreement.

4.3           Authorization.  The execution, delivery, and performance of this Agreement and the Registration Rights Agreement by the Company have been duly authorized by all requisite corporate action, and this Agreement and the Registration Rights Agreement constitute legal, valid, and binding obligations of the Company enforceable against the Company in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, or similar laws relating to or affecting the enforcement of creditors' rights.

4.4           Consents and Approvals.  The Company need not give any notice to, make any filing with, or obtain any authorization, consent, or approval (i) of any person under any instrument, contract or agreement to which the Company or any of its affiliates is a party or (ii) of any government or governmental agency in order to execute and deliver this Agreement and the Registration Rights Agreement, consummate the transactions contemplated hereby and thereby and perform its obligations hereunder and thereunder, except in the case of clause (ii) above for the filing of a registration statement with the SEC as contemplated by the Registration Rights Agreement.

  

4

  

4.5           Non-Contravention.  None of the execution and the delivery of this Agreement and the Registration Rights Agreement by the Company, the consummation of the transactions contemplated hereby and thereby and the performance by the Company of its obligations hereunder or thereunder will violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge or other restriction of any government, governmental agency, or court to which the Purchaser is subject or any instrument, contract, or agreement to which the Purchaser or any of its affiliates is a party

4.6           Shares.  The Shares, when issued pursuant to the terms of this Agreement against receipt of the payment therefor as provided for herein, will be validly issued, fully paid, and nonassessable, and will be free of any liens or encumbrances caused or created by the Company; provided, however, that the Shares shall be subject to restrictions on transfer under state or federal securities laws as set forth in this Agreement, or otherwise required at the time a transfer is proposed.

SECTION 5

MISCELLANEOUS

5.1           Survival.  The representations and warranties contained herein shall survive the execution and delivery of this Agreement and the sale of the Shares.

5.2           Assignment; Successors and Assigns.  This Agreement may not be assigned by either party without the prior written consent of the other party.  This Agreement and all provisions thereof shall be binding upon, inure to the benefit of, and are enforceable by the parties hereto and their respective successors and permitted assigns.

5.3           Notices.  All notices, requests, and other communications hereunder shall be in writing and will be deemed to have been duly given and received (a) when personally delivered, (b) when sent by facsimile upon confirmation of receipt, (c) one business day after the day on which the same has been delivered prepaid to a nationally recognized courier service, or (d) five business days after the deposit in the United States mail, registered or certified, return receipt requested, postage prepaid, in each case addressed to the Company at Three Riverway, Suite 1800, Houston, Texas 77056, Attn: Chief Executive Officer, with a copy to Brewer & Pritchard, P.C., Three Riverway, Suite 1800, Houston, Texas 77056, Attn: Thomas C. Pritchard, facsimile number (713) 209-2921, and as to the Purchaser at the address and facsimile number set forth below the Purchaser's signature on the Purchaser Omnibus Signature Page attached to this Agreement.  Any party hereto from time to time may change its address, facsimile number, or other information for the purpose of notices to that party by giving notice specifying such change to the other parties hereto.  The Purchaser and the Company may each agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures reasonably approved by it; provided that approval of such procedures may be limited to particular notices or communications.

5.4           Governing Law; Jurisdiction.  This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, both substantive and remedial. Any judicial proceeding brought against either of the parties to this agreement or any dispute arising out of this Agreement or any matter related hereto shall be brought in the courts of the State of Texas, Harris County, or in the United States District Court for the Southern District of Texas and, by its execution and delivery of this agreement, each party to this Agreement accepts the jurisdiction of such courts. The foregoing consent to jurisdiction shall not be deemed to confer rights on any person other than the parties to this Agreement.

  

5

  

5.5           Severability.  In the event that any provision of this Agreement or the application of any provision hereof is declared to be illegal, invalid, or otherwise unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall not be affected except to the extent necessary to delete such illegal, invalid, or unenforceable provision unless that provision held invalid shall substantially impair the benefits of the remaining portions of this Agreement.

5.6           Headings.  The headings in this Agreement are for convenience of reference only and shall not constitute a part of this Agreement, nor shall they affect its meaning, construction, or effect.

5.7           Counterparts; Omnibus Signature Page.  This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original instrument and all of which together shall constitute one and the same instrument.  By Purchaser's execution of the Purchaser Omnibus Signature Page attached to this Agreement, Purchaser agrees that it shall be deemed to have executed and be bound by this Agreement and the Registration Rights Agreement and agrees to comply with the terms and conditions of this Agreement and the Registration Rights Agreement.

5.8           Entire Agreement.  This Agreement embodies the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings relating to the subject matter hereof.

[Signature page follows]

 

 

 

 

 

 

 

 

 

 

 

  

6

  

PURCHASER OMNIBUS SIGNATURE PAGE TO

SUBSCRIPTION AGREEMENT AND

REGISTRATION RIGHTS AGREEMENT

Purchaser hereby elects to subscribe under the Subscription Agreement to which this Purchaser Omnibus Signature Page is attached (the "Subscription Agreement") for a total of ________ Shares for a Purchase Price of $0.12 per share (with a minimum subscription of $100,000, subject to the Company’s right to accept subscriptions for less than $100,000).

Subscriber’s signature below constitutes execution of both the Subscription Agreement and the Registration Rights Agreement (as defined in the Subscription Agreement).

If the Subscriber is an INDIVIDUAL, and if purchased as JOINT TENANTS, as TENANTS IN COMMON, or as COMMUNITY PROPERTY:

 

	
____________________________

	
______________________________

	
Print Name(s)

	
Social Security Number(s)

	  	  
	
___________________________

	
______________________________

	
Signature(s) of Purchaser(s)

	
Signature

	  	  
	
____________________________

	
______________________________

	
Date

	
Address

	  	  
	  	  
	
If the Subscriber is a PARTNERSHIP, CORPORATION, LIMITED LIABILITY COMPANY or TRUST:

	  
	  	  
	
____________________________

	
______________________________

	
Name of Partnership,

	
Federal Taxpayer

	
Corporation, Limited

	
Identification Number

	
Liability Company or Trust

	  
	  	  
	
By:_________________________

	
______________________________

	
Name:

	
State of Organization

	
Title:

	  
	  	  
	
__________________, 2013

	
 ______________________________

	
Date

	
Address

 

 

 

  

7

  

CERTIFICATE OF SIGNATORY

(To be completed if Shares are

being subscribed for by an entity)

I, ____________________________, am the ____________________________ of __________________________________________ (the “Entity”).

I certify that I am empowered and duly authorized by the Entity to execute and deliver the Subscription Agreement and the Registration Rights Agreement.

IN WITNESS WHEREOF, I have set my hand this ________ day of _________________, 2013.

 

 

	 	 	 	 
_______________________________________

	 	 	 	(Signature)
	 	 	 	 

 

                                                                                                                                                                                                                                                

 

 

 

 

 

 

 

 

 

 

  

8

  

GULFSLOPE ENERGY, INC.

SIGNATURE PAGE TO

SUBSCRIPTION AGREEMENT

ACCEPTED AND AGREED TO

this ____ day of ________________, 2013

GulfSlope Energy, Inc.

By : _______________________

Name: John N. Seitz

Title: Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

  

9

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