Document:

Arkanova Energy Corporation - Exhibit 10.3 - Filed by newsfilecorp.com

THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN
OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN)
PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “1933 ACT”).

NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN
REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO
REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE
PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE
CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. “UNITED STATES” AND “U.S.
PERSON” ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT.

STOCK OPTION AND SUBSCRIPTION AGREEMENT 
For Non –
U.S. Persons 

This AGREEMENT is entered into as of the 1st day of
March, 2014 (the “Date of Grant”). 

BETWEEN: 

  
    
      
        ARKANOVA ENERGY CORPORATION, with an office at 305 Camp
          Craft Road, Suite 525, Austin, Texas 78746 (the “Company”) 

      

    

  

AND: 

  
    
      
        ERICH HOFER  (the “Optionee”) 

      

    

  

WHEREAS: 

A.                      
The Company’s board of directors (the “Board”) has approved and adopted a Stock
Option Plan (the “Plan”), whereby the Board is authorized to grant stock options
to purchase common shares of the Company pursuant to the Plan to the directors,
officers, employees, management company employees and consultants of the
Company; 

B.                      
The Optionee currently provides services as a director of the Company (the
“Services”); and 

C.                      
The Company seeks to grant stock options to purchase a total of THREE HUNDRED
THOUSAND (300,000) shares of Common Stock to the Optionee in consideration for
the provision of the Services. 

2 

NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of
the covenants and agreements set forth herein and for other good and valuable
consideration, the receipt and sufficiency whereof is hereby acknowledged, the
parties hereto agree as follows: 

1.1                    
In this Agreement, the following terms shall have the following meanings: 

	 	(a) 	
      “Common Stock” means the shares of common stock of
      the Company;

	 	 	 
	 	(b) 	
      “Exercise Payment” means the amount of money equal
      to the Exercise Price multiplied by the number of Optioned Shares
      specified in the Notice of Exercise;

	 	 	 
	 	(c) 	
      “Exercise Price” means $0.10 per Optioned
      Share;

	 	 	 
	 	(d) 	
      “Expiry Date” means March 1, 2019;

	 	 	 
	 	(e) 	
      “Notice of Exercise” means a notice in writing
      addressed to the Company at its address first recited (or such other
      address of the Company as may from time to time be notified to the
      Optionee in writing), substantially in the form attached as Appendix “A”
      hereto, which notice shall specify therein the number of Optioned Shares
      in respect of which the Options are being exercised;

	 	 	 
	 	(f) 	
      “Options” means the irrevocable right and option
      to purchase, from time to time, all, or any part of the Optioned Shares
      granted to the Optionee by the Company pursuant to Section 1.2 of this
      Agreement;

	 	 	 
	 	(g) 	
      “Optioned Shares” means the shares of Common
      Stock, subject to the Options;

	 	 	 
	 	(h) 	
      “Securities” means, collectively, the Options and
      the Optioned Shares;

	 	 	 
	 	(i) 	
      “Shareholders” means holders of record of the
      shares of Common Stock;

	 	 	 
	 	(j) 	
      “U.S. Person” shall have the meaning ascribed
      thereto in Regulation S under the 1933 Act, and for the purpose of the
      Agreement includes any person in the United States; and

	 	 	 
	 	(k) 	
      “Vested Options” means the Options that have
      vested in accordance with Section 1.3 of this
Agreement.

1.2                   
 The Company hereby grants to the Optionee, on the terms and conditions set
out in this Agreement and in the Plan, Options to purchase a total of
THREE HUNDRED THOUSAND (300,000) Optioned Shares at the Exercise Price. 

1.3                     All
of the THREE HUNDRED THOUSAND (300,000) Options shall vest immediately upon the
Date of Grant. 

1.4                     The
Options shall, at 5:00 p.m. (Austin time) on the Expiry Date, expire and be of
no further force or effect whatsoever. 

1.5                     Vested
Options shall terminate, to the extent not previously exercised, in accordance
with Section 5(g) of the Plan. Each unvested Option granted pursuant hereto
shall terminate immediately upon termination of or resignation from the
Optionee’s employment or contractual relationship with the Company for any
reason whatsoever. 

3 

1.6                     Subject
to the provisions of this Agreement and the Plan and subject to compliance with
any applicable securities laws, the Options shall be exercisable, in full or in
part, at any time after vesting, until termination; provided, however, that if
the Optionee is subject to the reporting and liability provisions of Section 16
of the Securities Exchange Act of 1934 with respect to the Common Stock,
the Optionee shall be precluded from selling, transferring or otherwise
disposing of any Common Stock underlying any Options during the six (6) months
immediately following the grant of that Option. If less than all of the shares
included in the vested portion of any Options are purchased, the remainder may
be purchased at any subsequent time prior to the Expiry Date. Only whole shares
may be issued pursuant to the exercise of any Options, and to the extent that
any Options covers less than one (1) share, it is unexercisable. 

Notwithstanding any other provision herein, in the event of the
termination of Optionee’s employment for any reason, Optionee shall have one
year from the date of such termination to exercise any vested, but unexercised
Options granted pursuant hereto. 

1.7                    
Each exercise of the Options shall be by means of delivery of a Notice of
Exercise (which may be in the form attached hereto as Appendix A) to the
President of the Company at its principal executive office, specifying the
number of shares of Common Stock to be purchased and accompanied by payment in
cash by certified check or cashier’s check in the amount of the full exercise
price for the Common Stock to be purchased. In addition to payment in cash by
certified check or cashier’s check, an Optionee or transferee of the Options may
pay for all or any portion of the aggregate exercise price by complying with one
or more of the following alternatives: 

	 	(a) 	
      by delivering a properly executed Notice of Exercise
      together with irrevocable instructions to a broker promptly to sell or
      margin a sufficient portion of the Common Stock and deliver directly to
      the Company the amount of sale or margin loan proceeds to pay the exercise
      price; or

	 	 	 
	 	(b) 	
      by complying with any other payment mechanism approved by
      the Board at the time of exercise.

1.8                    
It is a condition precedent to the issuance of Optioned Shares that the Optionee
execute and/or deliver to the Company all documents and withholding taxes
required in accordance with applicable laws. 

1.9                    
Nothing in this Agreement shall obligate the Optionee to purchase any Optioned
Shares except those Optioned Shares in respect of which the Optionee shall have
exercised the Options in the manner provided in this Agreement. 

1.10                  
Reference is made to the Plan and the employment agreement between the Optionee
and the Company, if any, for particulars of the rights and obligations of the
Optionee and the Company in respect of: 

	 	(a) 	
      the terms and conditions on which the Options are
      granted; and

	 	 	 
	 	(b) 	
      a consolidation or subdivision of the Company’s share
      capital or an amalgamation or merger;

all to the same effect as if the provisions of the Plan were
set out in this Agreement and to all of which the Optionee assents. 

4 

1.11                  
The terms of the Options are subject to the provisions of the Plan, as the same
may from time to time be amended, and any inconsistencies among this Agreement,
the Plan and the employment agreement between the Optionee and the Company, if
any, as the same may be from time to time amended, shall be governed by the
provisions of the Plan. 

2.                      
Documents Required from Optionee 

2.1                    
The Optionee must complete, sign and return an executed copy of this Agreement
to the Company. 

2.2                    
The Optionee shall complete, sign and return to the Company as soon as possible,
on request by the Company, any documents, questionnaires, notices and
undertakings as may be required by regulatory authorities, and applicable law.

3.                     
 Acknowledgements of the Optionee 

3.1                    
The Optionee acknowledges and agrees that: 

	 	(a) 	
      the Optionee is a director of the Company;

	 	 	 
	 	(b) 	
      none of the Securities have been registered under the
      1933 Act or under any state securities or “blue sky” laws of any state of
      the United States, and, unless so registered, may not be offered or sold
      in the United States or, directly or indirectly, to U.S. Persons, except
      in accordance with the provisions of Regulation S, pursuant to an
      effective registration statement under the 1933 Act, or pursuant to an
      exemption from, or in a transaction not subject to, the registration
      requirements of the 1933 Act and in each case only in accordance with
      applicable state securities laws;

	 	 	 
	 	(c) 	
      the Company has not undertaken, and will have no
      obligation, to register any of the Securities under the 1933
Act;

	 	 	 
	 	(d) 	
      the Optionee has received and carefully read this
      Agreement and the public information which has been filed with the SEC in
      compliance or intended compliance with applicable securities legislation
      (collectively, the “Company Information”);

	 	 	 
	 	(e) 	
      the decision to execute this Agreement and acquire the
      Securities hereunder has not been based upon any oral or written
      representation as to fact or otherwise made by or on behalf of the
      Company, and such decision is based entirely upon a review of the Company
      Information (the receipt of which is hereby acknowledged);

	 	 	 
	 	(f) 	
      no securities commission or similar regulatory authority
      has reviewed or passed on the merits of the Securities;

	 	 	 
	 	(g) 	
      there is no government or other insurance covering the
      Securities;

	 	 	 
	 	(h) 	
      there are risks associated with an investment in the
      Securities;

5 

	 	(i) 	
      the Optionee has not acquired the Securities as a result
      of, and will not itself engage in, any “directed selling efforts” (as
      defined in Regulation S under the 1933 Act) in the United States in
      respect of the Securities which would include any activities undertaken
      for the purpose of, or that could reasonably be expected to have the
      effect of, conditioning the market in the United States for the resale of
      the Securities; provided, however, that the Optionee may sell or otherwise
      dispose of the Securities pursuant to registration thereof under the 1933
      Act and any applicable state securities laws or under an exemption from
      such registration requirements;

	 	 	 
	 	(j) 	
      the Optionee and the Optionee’s advisor(s) (if
      applicable) have had a reasonable opportunity to ask questions of and
      receive answers from the Company in connection with the distribution of
      the Securities hereunder, and to obtain additional information, to the
      extent possessed or obtainable without unreasonable effort or expense,
      necessary to verify the accuracy of the information about the
    Company;

	 	 	 
	 	(k) 	
      the books and records of the Company were available upon
      reasonable notice for inspection, subject to certain confidentiality
      restrictions, by the Optionee during reasonable business hours at its
      principal place of business, and all documents, records and books in
      connection with the distribution of the Securities hereunder have been
      made available for inspection by the Optionee, the Optionee’s attorney
      and/or advisor(s) (if applicable);

	 	 	 
	 	(l) 	
      the Company is entitled to rely on the representations
      and warranties and the statements and answers of the Optionee contained in
      this Agreement;

	 	 	 
	 	(m) 	
      the Optionee will indemnify and hold harmless the Company
      and, where applicable, its directors, officers, employees, agents,
      advisors and shareholders, from and against any and all loss, liability,
      claim, damage and expense whatsoever (including, but not limited to, any
      and all fees, costs and expenses whatsoever reasonably incurred in
      investigating, preparing or defending against any claim, lawsuit,
      administrative proceeding or investigation whether commenced or
      threatened) arising out of or based upon any representation or warranty of
      the Optionee contained herein or in any document furnished by the Optionee
      to the Company in connection herewith being untrue in any material respect
      or any breach or failure by the Optionee to comply with any covenant or
      agreement made by the Optionee to the Company in connection
    therewith;

	 	 	 
	 	(n) 	
      none of the Securities are listed on any stock exchange
      or automated dealer quotation system and no representation has been made
      to the Optionee that any of the Securities will become listed on any stock
      exchange or automated dealer quotation system; except that currently
      certain market makers make market in the common shares of the Company on
      the OTC Bulletin Board service of the National Association of Securities
      Dealers, Inc.;

	 	 	 
	 	(o) 	
      the Company will refuse to register any transfer of the
      Securities not made in accordance with the provisions of Regulation S,
      pursuant to an effective registration statement under the 1933 Act or
      pursuant to an available exemption from the registration requirements of
      the 1933 Act and in accordance with applicable state securities
    laws;

6 

	 	(p) 	
      the statutory and regulatory basis for the exemption
      claimed for the offer of the Securities, although in technical compliance
      with Regulation S, would not be available if the offering is part of a
      plan or scheme to evade the registration provisions of the 1933 Act or any
      applicable state and provincial securities laws;

	 	 	 
	 	(q) 	
      the Optionee has been advised to consult the Optionee’s
      own legal, tax and other advisors with respect to the merits and risks of
      an investment in the Securities and with respect to applicable resale
      restrictions, and it is solely responsible (and the Company is not in any
      way responsible) for compliance with:

	 	(i) 	
      any applicable laws of the jurisdiction in which the
      Optionee is resident in connection with the distribution of the Securities
      hereunder, and

	 	 	 
	 	(ii) 	
      applicable resale restrictions;
and

	 	(r) 	
      this Agreement is not enforceable by the Optionee unless
      it has been accepted by the Company.

4.                      
Representations, Warranties and Covenants of the Optionee 

4.1                     The
Optionee hereby represents and warrants to and covenants with the Company (which
representations, warranties and covenants shall survive the closing) that: 

	 	(a) 	
      the Optionee is a director of the Company;

	 	 	 
	 	(b) 	
      the Optionee has the legal capacity and competence to
      enter into and execute this Agreement and to take all actions required
      pursuant hereto;

	 	 	 
	 	(c) 	
      the Optionee has received and carefully read this
      Agreement;

	 	 	 
	 	(d) 	
      the Optionee has duly executed and delivered this
      Agreement and it constitutes a valid and binding agreement of the Optionee
      enforceable against the Optionee in accordance with its terms;

	 	 	 
	 	(e) 	
      the Optionee is not acquiring the Securities for the
      account or benefit of, directly or indirectly, any U.S. Person;

	 	 	 
	 	(f) 	
      the Optionee is not a U.S. Person;

	 	 	 
	 	(g) 	
      the Optionee is resident in the jurisdiction set out on
      page 1 of this Agreement;

	 	 	 
	 	(h) 	
      the acquisition of the Securities by the Optionee as
      contemplated in this Agreement complies with or is exempt from the
      applicable securities legislation of the jurisdiction of residence of the
      Optionee;

	 	 	 
	 	(i) 	
      the Optionee is acquiring the Securities for investment
      only and not with a view to resale or distribution and, in particular, it
      has no intention to distribute either directly or indirectly any of the
      Securities in the United States or to U.S.
Persons;

7 

	 	(j) 	
      the Optionee is outside the United States when receiving
      and executing this Agreement and is acquiring the Securities as principal
      for the Optionee’s own account, for investment purposes only, and not with
      a view to, or for, resale, distribution or fractionalisation thereof, in
      whole or in part, and no other person has a direct or indirect beneficial
      interest in such Securities;

	 	 	 
	 	(k) 	
      the Optionee is not an underwriter of, or dealer in, the
      common shares of the Company, nor is the Optionee participating, pursuant
      to a contractual agreement or otherwise, in the distribution of the
      Securities;

	 	 	 
	 	(l) 	
      the Optionee (i) has adequate net worth and means of
      providing for his/her/its current financial needs and possible personal
      contingencies, (ii) has no need for liquidity in this investment, and
      (iii) is able to bear the economic risks of an investment in the
      Securities for an indefinite period of time, and can afford the complete
      loss of such investment;

	 	 	 
	 	(m) 	
      the Optionee is aware that an investment in the Company
      is speculative and involves certain risks, including the possible loss of
      the investment, and the Optionee has carefully read and considered the
      matters set forth under the caption “Risk Factors” appearing in the
      Company’s various disclosure documents, filed with the SEC;

	 	 	 
	 	(n) 	
      the Optionee has the requisite knowledge and experience
      in financial and business matters as to be capable of evaluating the
      merits and risks of the investment in the Securities and the
    Company;

	 	 	 
	 	(o) 	
      the Optionee understands and agrees that the Company and
      others will rely upon the truth and accuracy of the acknowledgements,
      representations and agreements contained in this Agreement, and agrees
      that if any of such acknowledgements, representations and agreements are
      no longer accurate or have been breached, the Optionee shall promptly
      notify the Company;

	 	 	 
	 	(p) 	
      the Optionee acknowledges that the Optionee has not
      acquired the Securities as a result of, and will not itself engage in, any
      “directed selling efforts” (as defined in Regulation S under the 1933 Act)
      in the United States in respect of the Securities which would include any
      activities undertaken for the purpose of, or that could reasonably be
      expected to have the effect of, conditioning the market in the United
      States for the resale of the Securities; provided, however, that the
      Optionee may sell or otherwise dispose of the Securities pursuant to
      registration of the Securities pursuant to the 1933 Act and any applicable
      state and provincial securities laws or under an exemption from such
      registration requirements and as otherwise provided herein;

	 	 	 
	 	(q) 	
      the Optionee has made an independent examination and
      investigation of an investment in the Securities and the Company and has
      depended on the advice of its legal and financial advisors and agrees that
      the Company will not be responsible in anyway whatsoever for the
      Optionee’s decision to invest in the Securities and the
  Company;

8 

	 	(r) 	
      the Optionee understands and agrees that none of the
      Options or the Optioned Securities have been or will be registered under
      the 1933 Act, or under any state securities or “blue sky” laws of any
      state of the United States, and, unless so registered, may not be offered
      or sold except in accordance with the provisions of Regulation S, pursuant
      to an effective registration statement under the 1933 Act, or pursuant to
      an exemption from, or in a transaction not subject to, the registration
      requirements of the 1933 Act and in each case only in accordance with
      applicable state securities laws;

	 	 	 
	 	(s) 	
      it understands and agrees that the Company will refuse to
      register any transfer of the Optioned Securities not made in accordance
      with the provisions of Regulation S, pursuant to an effective registration
      statement under the 1933 Act or pursuant to an available exemption from,
      or in a transaction not subject to, the registration requirements of the
      1933 Act;

	 	 	 
	 	(t) 	
      the Optionee is not aware of any advertisement of any of
      the Securities and is not acquiring the Securities as a result of any form
      of general solicitation or general advertising including advertisements,
      articles, notices or other communications published in any newspaper,
      magazine or similar media or broadcast over radio or television, or any
      seminar or meeting whose attendees have been invited by general
      solicitation or general advertising; and

	 	 	 
	 	(u) 	
      no person has made to the Optionee any written or oral
      representations:

	 	(i) 	
      that any person will resell or repurchase any of the
      Securities;

	 	 	 
	 	(ii) 	
      that any person will refund the purchase price of any of
      the Securities; or

	 	 	 
	 	(iii) 	
      as to the future price or value of any of the
      Securities.

4.2                    
In this Agreement, the term “U.S. Person” shall have the meaning ascribed
thereto in Regulation S promulgated under the 1933 Act and, for the purpose of
this Agreement, includes any person in the United States. 

5.                      
Acknowledgement and Waiver 

5.1                    
The Optionee has acknowledged that the decision to purchase the Securities was
solely made on the basis of publicly available information contained in the
Company Information. The Optionee hereby waives, to the fullest extent permitted
by law, any rights of withdrawal, rescission or compensation for damages to
which the Optionee might be entitled in connection with the distribution of any
of the Securities. 

6.                     
 Legending of Subject Securities 

6.1                    
The Optionee hereby acknowledges that that upon the issuance thereof, and until
such time as the same is no longer required under the applicable securities laws
and regulations, the certificates representing any of the Securities will bear a
legend in substantially the following form: 

9 

  
    
      
        THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED IN AN
          OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN)
          PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
          AMENDED (THE “1933 ACT”). NONE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN
          REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO
          REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED
          STATES (AS DEFINED HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE
          PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE
          REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION
          FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
          1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
          LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE
          CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. “UNITED STATES” AND “U.S.
          PERSON” ARE AS DEFINED BY REGULATION S UNDER THE 1933 ACT. 

      

    

  

6.2                    
The Optionee hereby acknowledges and agrees to the Company making a notation on
its records or giving instructions to the registrar and transfer agent of the
Company in order to implement the restrictions on transfer set forth and
described in this Agreement. 

7.                      
Costs 

7.1                     The
Optionee acknowledges and agrees that all costs and expenses incurred by the
Optionee (including any fees and disbursements of any special counsel retained
by the Optionee) relating to the acquisition of the Securities shall be borne by
the Optionee. 

8.                     
 Governing Law 

8.1                    
This Agreement is exclusively governed by the laws of the State of Texas and the
federal laws of the United States applicable therein. The Optionee irrevocably
attorns to the exclusive jurisdiction of the courts of the State of Texas. 

9.                      
Survival 

9.1                     This
Agreement, including without limitation the representations, warranties and
covenants contained herein, shall survive and continue in full force and effect
and be binding upon the parties hereto notwithstanding the completion of the
purchase of the shares underlying the Options by the Optionee pursuant hereto.

10.                    
Assignment 

10.1                  
This Agreement is not transferable or assignable. 

10 

11.                    
Counterparts and Electronic Means 

11.1                   This
Agreement may be executed in several counterparts, each of which will be deemed
to be an original and all of which will together constitute one and the same
instrument. Delivery of an executed copy of this Agreement by electronic
facsimile transmission or other means of electronic communication capable of
producing a printed copy will be deemed to be execution and delivery of this
Agreement as of the date first above written. 

12.                    
Currency 

12.1                   Unless
explicitly stated otherwise, all funds in this Agreement are stated in United
States dollars. 

13.                     Severability

13.1                   The
invalidity or unenforceability of any particular provision of this Agreement
shall not affect or limit the validity or enforceability of the remaining
provisions of this Agreement. 

14.                    
Entire Agreement 

14.1                   Except
as expressly provided in this Agreement and in the agreements, instruments and
other documents contemplated or provided for herein, this Agreement is the only
agreement between the Optionee and the Company with respect to the Options, and
this Agreement supersedes all prior and contemporaneous oral and written
statements and representations and contains the entire agreement between the
parties with respect to the Securities. 

15.                     Effectiveness

15.1                   This
Agreement shall be deemed to be effective following the delivery by the Optionee
to the Company of two fully executed copies of this Agreement. 

11 

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

ARKANOVA ENERGY CORPORATION 

 

	By: 	/s/ Reginald Denny 	 
	  	Authorized Signatory 	 

	WITNESSED BY: 	) 	  
	  	) 	  
	  	) 	  
	Name 	) 	  
	  	) 	  
	Address 	) 	/s/
      Erich Hofer 
	  	) 	ERICH HOFER 
	  	) 	  
	  	) 	  
	Occupation 	) 	  

APPENDIX A

	TO: 	Arkanova Energy Corporation 
	  	305 Camp Craft Road, Suite 525, 
	  	Austin, Texas 78746 

Notice of Exercise 

This Notice of Exercise shall constitute proper notice pursuant
to Section 1.7 of the Stock Option and Subscription Agreement dated as of March
1, 2014 (the “Agreement”), between the Company and the undersigned. The
undersigned hereby elects to exercise Optionee’s option to purchase
____________________shares of the common stock of the Company at price of
US$0.10 per share, for aggregate consideration of US$ ____________, on the terms
and conditions set forth in the Agreement. Such aggregate consideration, in the
form specified in Section 1.7 of the Agreement, accompanies this notice. The
undersigned reconfirms the representations and warranties set out in the
Agreement as of the date hereof. 

The Optionee hereby directs the Company to issue, register and
deliver the certificates representing the shares as follows: 

	Registration Information: 	 	Delivery Instructions: 
	 	 	 
	 	 	 
	Name to appear on
      certificates 	 	Name
  
	 	 	 
	 	 	 
	Address 	 	Address
    
	  	 	  
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	  	 	Telephone Number 

DATED at ____________________________________, the _______day
of______________, _______. 

	 	 	 
	 	 	(Name of Optionee – Please type or print)

	 	 	 
	 	 	 
	 	 	(Signature and, if applicable, Office) 
	 	 	 
	 	 	 
	 	 	(Address of Optionee) 
	 	 	 
	 	 	 
	 	 	(City, State, and Zip Code of Optionee) 
	 	 	 
	 	 	 
	 	 	(Fax Number)Arkanova Energy Corporation - Exhibit 10.6 - Filed by newsfilecorp.com

AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT 

THIS AGREEMENT made the 1st day of March, 2014. 

BETWEEN: 

  
    
      
        ARKANOVA ENERGY CORPORATION, a Nevada corporation 

        (the “Company”) 

      

    

  

AND: 

  
    
      
        PIERRE MULACEK, an  individual

        (the “Executive”) 

      

    

  

WHEREAS: 

A.          The
Company and the Executive entered into an Employment Agreement, dated July 17,
2012 (the “Employment Agreement”), pursuant to which the Executive and
the Company agreed to pay the Executive a salary of US $240,000 per annum; 

B.          The
Company and the Executive have agreed to decrease the annual compensation
payable to the Executive from US $240,000 per annum to US $135,000 per annum,
which decrease is effective on March 1, 2014; and 

C.          The Company
and the Executive have agreed to amend the terms of the Employment Agreement to
decrease the compensation payable to the Executive to US $135,000 per annum.

NOW THEREFORE THIS AGREEMENT witnesses that, for good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows: 

	1. 	
      Section 8(a) of the Employment Agreement is deleted and
      replaced with the following:

	(a) 	
      As compensation for the services provided by the
      Executive under this Agreement, the Company will pay the Executive an
      annual salary of $135,000.00, to be paid in accordance with the Company's
      usual payroll procedures (the
“Salary”).

	2. 	
      The Company and the Executive each acknowledge and agree
      that all other provisions of the Employment Agreement remain in full force
      and effect.

- 2 - 

	3. 	
      This Agreement may be executed in counterpart and such
      counterparts together shall constitute a single instrument. Delivery of an
      executed counterpart of this Agreement by electronic means, including by
      facsimile transmission or by electronic delivery in portable document
      format (“.pdf”), shall be equally effective as delivery of a manually
      executed counterpart hereof. The Parties acknowledge and agree that in any
      legal proceedings between them respecting or in any way relating to this
      Agreement, each waives the right to raise any defense based on the
      execution hereof in counterparts or the delivery of such executed
      counterparts by electronic means.

	 	 
	4. 	
      This Agreement will be governed by and construed in
      accordance with the law of Texas.

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

ARKANOVA ENERGY CORPORATION 

 

	Per: 	/s/ Reginald Denny 	 
	  	Authorized Signatory 	 

 

	/s/ Pierre
      Mulacek 	 
	PIERRE G. MULACEK

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