GSPE Gulfslope Energy Inc (CE)

Securities Purchase Agreement

On October 10, 2022, GulfSlope Energy, Inc. (the “ Company ”), entered into a Securities Purchase Agreement (“ SPA ”) with one or more buyers identified on the signature pages thereto (“ Buyers ”) attached hereto as Exhibit 10.1. Under the terms of the SPA, the Company will issue and sell to Buyers up to an aggregate of $650,000 of convertible promissory notes (“ Convertible Notes ”), which shall be convertible (as converted, the “ Conversion Shares ”) into shares of the Company’s common stock, par value $0.001 per share (the “ Common Stock ”), of which $55,000 shall be purchased upon the signing of the SPA (the “ First Closing ”), with additional tranches of financing subject to further agreement by and between the Buyer and the Company. The SPA contains customary representations, warranties and agreements by us and customary conditions to closing.  

Additionally, the sale of the Convertible Notes is being made pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the “ Securities Act ”). See “Convertible Notes” below.

The above description of the SPA does not purport to be complete and is qualified in its entirety by the full text of such SPA, which is incorporated herein and attached hereto as Exhibit 10.1.

Convertible Notes

Pursuant to the terms of the SPA, at the First Closing (the “ Issuance Date ”), the Company sold to Buyer a Convertible Note. The principal amount of the Convertible Note is $55,000 (as reduced pursuant to redemption, conversion or otherwise, the “ Principal ”), it has an annual interest rate equal to 8% (the interest paid on the outstanding Principal at the applicable interest rate, the “ Interest ”) and a maturity date of April 8, 2023 (the “ Maturity Date ”). At the Maturity Date the Company shall pay to the Holder (as defined in the Convertible Note) an amount in cash representing all outstanding Principal and accrued and unpaid Interest.

Subject to the terms of the Convertible Note, six months after the Issuance Date, the Holder is entitled to convert at the Conversion Price (as defined below) any portion of the outstanding and unpaid Principal and accrued Interest (the “ Conversion Amount ”) into fully paid and nonassessable shares of Common Stock. The number of shares of Common Stock issuable upon conversion of any Conversion Amount is determined by dividing (x) such Conversion Amount by (y) the Conversion Price. The “ Conversion Price ” is 65% of the lowest daily VWAP price (as reported by Bloomberg, LP) for the ten (10) consecutive trading days immediately preceding the date of determination.

The Convertible Debenture contains customary representations, warranties and agreements typical in convertible notes. The Offering was exempt from registration under Section 4(a)(2) of the Securities Act. The above description of the Convertible Notes does not purport to be complete and is qualified in its entirety by the full text of the Convertible Notes, which is incorporated herein attached hereto as Exhibit 10.2.