1
A PROSPECTIVE SUBSCRIBER SHOULD CONSIDER AND REVIEW THE INFORMATION UNDER THE
CAPTION "RISK FACTORS" BEGINNING ON PAGE 4 OF EXHIBIT "A" ATTACHED AND
INCORPORATED HEREIN BY REFERENCE IN CONNECTION WITH HIS DECISION CONCERNING THE
SUBSCRIPTION OF SECURITIES DESCRIBED HEREIN.
PRIVATE PLACEMENT
SUBSCRIPTION AGREEMENT
THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (the "Agreement"), dated
as of the date of acceptance set forth below, by and between Harken Energy
Corporation, a Delaware corporation, with headquarters located at 0000 Xxxxx
XxxXxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000 (the "Company"), and the undersigned
(the "Buyer").
WITNESSETH:
WHEREAS, the Company and the Buyer are executing and delivering this
Agreement in reliance upon one or more exemptions from securities registration,
including, but not limited to, the exemptions afforded by Rule 506 under
Regulation D ("Regulation D") as promulgated by the United States Securities
and Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "1933 Act") and Rule 504 of Regulation D; and
WHEREAS, the Buyer wishes to subscribe for and purchase shares of
Common Stock, $.01 par value (the "Common Stock"), of the Company upon the
terms and subject to the conditions of this Agreement, subject to acceptance of
this Agreement by the Company,
NOW THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. AGREEMENT TO SUBSCRIBE; PURCHASE PRICE.
a. SUBSCRIPTION. The undersigned hereby subscribes for
and agrees to purchase the number of shares of Common Stock set forth on the
signature page of this Agreement (the "Shares") at the price per Share set
forth on the signature page of this Agreement. The aggregate purchase price for
the Shares shall be as set forth on the signature page hereto and shall be
payable in United States Dollars.
b. SUBSCRIPTION PRICE. The subscription price (the
"Subscription Price") per share of the Common Stock shall be based upon the
average closing market price (the "Average Price") for the Common Stock as
listed on the American Stock Exchange for the five (5) trading
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Private Placement Subscription Agreement
August 15, 1995
Page 2
days immediately prior to August 4, 1995. The Subscription Price per share
shall be determined as the Average Price less a twenty five percent (25%)
discount.
c. FORM OF PAYMENT. The Buyer shall pay the Subscription
Price for the Shares by delivering good funds in United States Dollars to the
Company's bank account identified in item l,d below. Promptly following payment
by the Buyer to the Company of the Subscription Price for the Shares, the
Company shall deliver a certificate for the Shares to the Buyer.
d. METHOD OF PAYMENT. Payment of the purchase price for
the Shares shall be made by wire transfer of funds to:
Company: Harken Energy Corporation
Bank: First Interstate Bank, Houston
Account No.: 400-02-2358-6
ABA No.: 000000000
Telephone No.: 0-000-000-0000
Not later than 4:00 p.m., Dallas, Texas time, on the date which is three
business days after the date on which the Company shall have accepted this
Agreement and returned a signed counterpart of this Agreement to the Buyer, the
Buyer shall deposit with the Company's bank the aggregate subscription price
for the Shares.
2. BUYER REPRESENTATIONS, WARRANTIES, ETC.; ACCESS TO INFORMATION;
INDEPENDENT INVESTIGATION.
The Buyer represents and warrants to, and covenants and agrees with,
the Company as follows:
a. The Buyer is purchasing the Shares for his own account, not as
nominee or agent, for investment only and not with a view towards the public
sale or distribution thereof,
b. The Buyer is an "Accredited Investor" as that term is defined
in Rule 501 of Regulation D by reason of Rule 501(a)(5) or (6);
c. The Buyer has substantial experience in evaluating and
investing in private placement investments of Securities in companies similar
to the Company or has engaged his own advisors for advice and counsel
concerning Buyer's purchase of the Shares, so that he is capable of evaluating
the merits and risks of his investment in the Company and has the capability to
protect his own interests.
d. All subsequent offers and sales of the Shares by the Buyer
shall be made
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Private Placement Subscription Agreement
August 15, 1995
Page 3
pursuant to registration of the Shares under the 1933 Act or pursuant to a
valid exemption from registration;
e. The Buyer understands that the Shares are being
offered and sold to him in reliance on specific exemptions from the
registration requirements of United States federal and state Securities laws
and that the Company is relying upon the truth and accuracy of, and the Buyer's
compliance with, the representation, warranties, agreements, acknowledgments
and understandings of the Buyer set forth herein in order to determine the
availability of such exemptions and the eligibility of the Buyer to acquire the
Shares:
f. The Buyer and/or his advisors have been furnished
with all materials relating to the business, management, finances and
operations of the Company and materials relating to the offer and sale of the
Shares which have been requested by the Buyer. The Buyer and his advisors have
been afforded the opportunity to ask questions of the officers of the Company
and have received complete and satisfactory answers to any such inquiries.
Without limiting the generality of the foregoing, the Buyer has had the
opportunity to obtain and to review the Company's (1) Annual Report on Form
10-K for the year ended December 31, 1994, (2) quarterly Reports on Form 10-Q
for the quarters ended March 31, June 30, and September 30, 1994, March 31
and June 30, 1995, (3) Proxy Statement dated April 26, 1995 for the Company's
1995 Annual Meeting and (4) Current Reports on Form 8-K, dated November 4, 1994
as amended on January 3, 1995, and dated April 27, 1995, May 16, 1995, and June
2, 1995, amended on August 3 , 1995, in each case as filed with the Commission.
The Buyer understands that its investment in the Shares involves a high degree
of risk and Buyer is relying solely upon its own knowledge and experience in
making its decision to purchase the Shares and in this regard has received and
read a document entitled "Harken Energy Corporation Supplemental Information"
dated August 14, 1995, which is attached hereto on Exhibit "A";
g. The Buyer understands that no United States federal
or state agency or any other government or governmental agency has passed on or
made any recommendation or endorsement of the Shares; and
h. This Agreement has been duly and validly authorized,
executed and delivered on behalf of the Buyer and is a valid and binding
agreement of the Buyer enforceable in accordance with its terms, subject as to
enforceability to general principles of equity and to bankruptcy or other laws
affecting the enforcement of creditors' rights generally.
i Buyer acknowledges that the Shares must be held
indefinitely unless subsequently registered under the 1933 Act or unless an
exemption from such registration is available. It is aware of the provisions of
Rule 144 promulgated under the 1933 Act which permit limited resale of shares
purchased in a private placement subject to the satisfaction of certain
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Private Placement Subscription Agreement
August 15, 1995
Page 4
conditions, including, among other, things, the existence of a public market
for the shares, the availability of certain current public information about
the Company, the resale occurring not less than two years after a party has
purchased and paid for the security to be sold, the sale being effected through
a "broker's transaction" or in transactions directly with a "market maker" and
the number of shares being sold during any three-month period not exceeding
specified limitations.
3. COMPANY REPRESENTATIONS.
The Company represents and warrants to the Buyer that:
a. ORGANIZATION AND GOOD STANDING. The Company is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and is qualified to do business in the State of
Texas. The Company has full power and authority to enter into this Agreement
and consummate the transactions contemplated by this Agreement. The execution
and delivery of this Agreement by the Company and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of the Company, and this Agreement is a valid and
binding obligation of the Company enforceable in accordance with its terms.
b. FINANCIAL CONDITION. That since the June 30, 1995
10-Q, there has been no material adverse change in the financial condition of
the Company.
c. CONCERNING THE SHARES. The Shares, when issued,
delivered and paid for in accordance with this Agreement, will be duly and
validly authorized and issued, fully paid and nonaccessible and will not
subject the holder thereof to personal liability by reason of being such
holder. There are no preemptive rights of any stockholder of the Company, as
such, to acquire the Shares.
d. SUBSCRIPTION AGREEMENT. This Agreement, when accepted
by the Company, shall have been duly and validly authorized , executed and
delivered on behalf of the Company and shall be a valid and binding agreement
of the Company enforceable in accordance with its terms, subject as to
enforceability to general principles of equity and to bankruptcy or other laws
affecting 1.7 the enforcement of creditors' rights generally.
e. NON-CONTRAVENTION. The execution and delivery of this
Agreement by the Company and the consummation by the Company of the issuance of
the Shares and the other transactions contemplated by this Agreement do not and
will not conflict with or result in a breach by the Company of any of the terms
or provisions of, or constitute a default under, the certificate of
incorporation or by-laws of the Company, or any indenture, mortgage, deed of
trust or other material agreement or instrument to which the Company is a party
or by which it or any of its properties or assets are bound, or any existing
applicable law, rule or regulation or any applicable decree,
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Private Placement Subscription Agreement
August 15, 1995
Page 5
judgment or order of any court, United States federal or state regulatory body,
administrative agency or other governmental body having jurisdiction over the
Company or any of its properties or assets.
f. APPROVALS. The Company is not aware of any
authorization, approval or consent of any governmental body which is required
to be obtained by the Company for the issuance and sale of the Shares to the
Buyer as contemplated by this Agreement other than the filing of a listing
application covering the Shares with the American Stock Exchange, Inc.
4. CERTAIN COVENANTS AND ACKNOWLEDGEMENTS.
a. TRANSFER RESTRICTIONS. The Buyer acknowledges that
(1) the Shares to be issued to it hereunder have not been and are not being
registered under the provisions of the 1933 Act (except as provided in the
registration procedures set forth in Section 5 of this Agreement), and may not
be transferred unless (A) the Shares are subsequently registered under the 1933
Act or (B) the Buyer shall have delivered to the Company an opinion of counsel,
reasonably satisfactory in form, scope and substance to the Company, to the
effect that the Shares may be sold or transferred pursuant to a valid exemption
from such registration; (2) any sale of the Shares made in reliance on Rule 144
promulgated under the 1933 Act may be made only in accordance with the terms of
said Rule and further, if said Rule is not applicable, any resale of such
Shares under circumstances in which the seller, or the person through whom the
sale is made, may be deemed to be an underwriter, as that term is used in the
1933 Act, may require compliance with some other exemption under the 1933 Act
or the rules and regulations of the Commission thereunder; and (3) neither the
Company or any other person is under any obligation to register the Shares
(other than pursuant to the registration procedure referred to in Section 5 of
this Agreement) under the 1933 Act or any state Securities regulations or to
comply with the terms and conditions of any exemption thereunder.
b. RESTRICTIVE LEGEND. The Buyer acknowledges and agrees
that the certificates for the Shares may bear a restrictive legend in
substantially the following form (and a stop-transfer order may be placed
against transfer of the certificates for the Shares):
The shares represented by this certificate have not been registered
under the Securities Act of 1933, as amended. The shares have been
acquired for investment and may not be sold, transferred or assigned
in the absence of an effective registration statement for these shares
under the Securities Act of 1933, as amended, or an opinion of
counsel acceptable to the Company that registration is not required
under said Act.
c. FORM D. The Company agrees to file a Form D with
respect to the Shares as required under Regulation D.
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Private Placement Subscription Agreement
August 15, 1995
Page 6
5. REGISTRATION PROCEDURES.
a. Within 60 days from the date of Closing Date (as
defined in Section 7) the Company shall prepare and file or cause to be filed
with the Securities and Exchange Commission ("Commission") a registration
statement (the "Registration Statement") with respect to all of the Shares
(such Shares being registered are referred to as "Registrable Shares"). The
Company shall thereafter use its best efforts in attempting to cause the
Registration Statement to be declared effective by the Commission and shall
thereafter use diligence to maintain the effectiveness of the Registration
Statement for the shorter of (i) one year from the date of effectiveness; or
(ii) the date on which all of the Registerable Shares have been sold by Buyer.
b. Following effectiveness, the Company shall furnish to
each Buyer a prospectus as well as such other documents, in connection with his
sale of the Shares, as the Buyer may reasonably request and the Company may
lawfully deliver.
c. The Company shall use diligent efforts to (i)
register and qualify the Registrable Shares covered by the Registration
Statement under such other Securities or blue sky laws of such jurisdictions as
the Buyer may reasonably request (ii) prepare and file in those jurisdictions
such amendments (including post-effective amendments) and supplements, (iii)
take such other actions as may be necessary to maintain such registrations and
qualifications in effect at all times when the Registration Statement is
likewise maintained effective, (iv) take all other actions reasonably necessary
or advisable to qualify the Registerable Shares for sale in such jurisdictions;
provided however, that the Company shall not be required in connection
therewith or as a condition thereto (I) qualify to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 5(c), (II) subject itself to general taxation in any such jurisdiction,
(III) file a general consent to service of process in any such jurisdiction,
(IV) provide any undertakings that cause more than nominal expense or burden to
the Company or (V) make any change in its charter or bylaws, which in each case
the Board of Directors of the Company determines to be contrary to the best
interests of the Company and its stockholders;
d. The Company shall, following effectiveness of the
Registration Statement, as promptly as practicable after becoming aware of such
event, notify the Buyer of the happening of any event of which the Company has
knowledge, as a result of which the prospectus included in the Registration
Statement, as then in effect, includes an untrue statement of a material fact
or omits to state material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading, and use its best efforts promptly to prepare a
supplement or amendment to the Registration Statement to correct such untrue
statement or omission, and deliver a number of copies of such supplement or
amendment to each Buyer or as Buyer may reasonably request;
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Private Placement Subscription Agreement
August 15, 1995
Page 7
e. Following effectiveness of the Registration
Statement, the Company, as promptly as practicable after becoming aware of such
event, will notify the Buyer of the issuance by the Commission of any stop
order or other suspension of effectiveness of the Registration Statement at the
earliest possible time;
f. Following effectiveness the Company will use
diligence either to (i) cause all the Registrable Shares covered by the
Registration Statement to be listed on a national Securities exchange and on
each additional national Securities exchange on which similar Securities issued
by the Company are then listed, if any, if the listing of such Shares is then
permitted under the rules of such exchange or (ii) secure designation of all
the Registerable Shares covered by the Registration Statement as a National
Association of Securities Dealers Automated Quotations System ("NASDAQ")
"national market system security" within the meaning of Rule llAa2-1 of the
Commission under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the quotation of the Registerable Shares on the NASDAQ National
Market System or, if, despite the Company's best efforts to satisfy the
preceding clause (i) or (ii), the Company is unsuccessful in satisfying the
preceding clause (i) or (ii), to secure listing on a national Securities
exchange or NASDAQ authorization and quotation for such Registerable Securities
and, without limiting the generality of the foregoing, to arrange for at least
two market makers to register with the National Association of Securities
Dealers, Inc. ("NASD") as such with respect to such Registerable Securities;
g. Provide a transfer agent and registrar, which may be
a single entity, for the Shares not later than the effective date of the
Registration Statement;
h. Take all other reasonable actions necessary to
expedite and facilitate disposition by the Buyer of the Registerable Shares
pursuant to the Registration Statement;
i. In the event that the Company shall have failed to
prepare and file the Registration Statement with the Commission within the time
period set forth under Section 5(a) above, then the Buyer may engage
independent legal counsel to prepare and file a registration statement covering
the Shares and the Company shall bear the reasonable costs and expenses of such
independent counsel in connection therewith.
j. It shall be a condition precedent to the obligations
of the Company to take any action pursuant to this Section 5 that the Buyer
shall furnish to the Company such information regarding itself, the Shares held
by it and the intended method of disposition of the Registerable Shares held by
it as shall be reasonably required to the effect the registration of the Shares
and shall execute such documents in connection with such registration as the
Company may reasonably request.
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Private Placement Subscription Agreement
August 15, 1995
Page 8
k. The Buyer agrees to cooperate with the Company in any
manner reasonably requested by the Company in connection with the preparation
and filing of the Registration Statement hereunder unless such Buyer shall
elect in writing to the Company to exclude all of such Buyer's Shares from the
Registration Statement;
l. The Buyer agrees that, upon receipt of any notice
from the Company of the happening of any event of the kind described in Section
5(d) or 5(e), Buyer will immediately discontinue disposition of Registerable
Shares pursuant to the Registration Statement covering such Registrable Shares
until such Buyer's receipt of the copies of the supplemented or amended
prospectus and, if so directed by the Company, shall deliver to the Company (at
the expense of the Company) or destroy (and deliver to the Company a
certificate of destruction) all copies in Buyer's possession of the prospectus
covering such Shares current at the time of receipt of such notice; and
m. All expenses, including fees of investment bankers
engaged by the Company, incurred in connection with registrations, filings or
qualifications pursuant to this Section 5, including, without limitation, all
registration, listing and qualification fees, printers and accounting fees and
the fees and disbursements of counsel to the Company, shall be borne by the
Company, including in the event of the applicability of Section 5(i) the costs
of Buyer's independent legal counsel, except for any costs, fees or expenses
related to Buyers sale of the Shares including but not limited to any brokerage
commissions and underwriting discounts and commissions.
n. To the extent permitted by law, the Company will
indemnify and hold harmless each Buyer who holds such Registerable Shares, the
directors, if any, of such Buyer, the officers, if any, of such Buyer, each
person, if any, who controls any Buyer within the meaning of the Securities
Act or the Exchange Act, any underwriter (as defined in the 0000 Xxx) for the
Buyer, the directors, if any, of such underwriter and the officers, if any , of
such underwriter, and each person, if any, who controls any such underwriter
within the meaning of the 1933 Act or the Exchange Act (each, an "Indemnified
Person"), against any losses, claims, damages, expenses or liabilities (joint or
several) (collectively, "Claims") to which any of them may become subject under
the 1933 Act, the Exchange Act or otherwise, insofar as such Claims (or actions
or proceedings, whether commenced or threatened, in respect thereof) arise out
of or are based upon any of the following statements, omissions or violations
in the Registration Statement, or any post-effective amendment thereof, or any
prospectus included therein; (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
post effective amendment thereof or the omission or alleged omission to state
there a material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus if used
prior to the effective date of such Registration Statement, or contained in the
final prospectus (as amended or supplemented, if the Company files any
amendment thereof or supplement thereto with the Commission) or the omission or
alleged omission to state therein any material fact necessary to
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Private Placement Subscription Agreement
August 15, 1995
Page 9
make the statements made therein, in light of the circumstances under which the
statements therein were made, not misleading or (iii) any violation or alleged
violation by the Company of the Securities Act, any state Securities law or any
rule or regulation by the Company of the 1933 Act the Exchange Act or any state
Securities law (the matters in the foregoing clauses (i) through (iv) being,
collectively, "Violations"). Subject to the restrictions set forth in Section
5(p) with respect to the number of local counsel, the Company shall reimburse
the Buyer and each such underwriter or controlling person, promptly as such
expenses are incurred and are due and payable, for any legal fees or other
reasonable expenses incurred by them in connection with investigating or
defending any such Claim. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 5(n) (I) shall
not apply to a Claim arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in writing to the
Company by any Indemnified Person or underwriter for such Indemnified Person
expressly for use in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement thereto, if such
prospectus was timely made available by the Company; (II) with respect to any
preliminary prospectus shall not inure to the benefit of any such person from
whom the person asserting any such Claim purchased the Registrable Securities
that are the subject thereof (or to the benefit of any person controlling such
person) if the untrue statement or omission of material fact contained in the
preliminary prospectus was corrected in the prospectus, as then amended or
supplemented, if such prospectus was timely made available by the Company; and
(III) shall not apply to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which
consent shall not be reasonably withheld. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of the
Indemnified Person and shall survive the transfer of the Registrable Shares by
the Buyers.
o. In connection with any Registration Statement in
which Buyer is participating, such Buyer agrees to indemnify and hold harmless,
to the same extent and in the same manner set forth in Section 5(n), the
Company, each of its directors, each of its officers who signs the Registration
Statement, each person, if any, who controls the Company within the meaning of
the 1933 Act or the Exchange Act, any underwriter and any other stockholder
selling Securities pursuant to the Registration Statement or any of its
directors or officers or any person who controls such stockholder or
underwriter within the meaning of the 1933 Act or the Exchange Act
(collectively and together with an Indemnified Person, an "Indemnified Party"),
against any Claim to which any of them may become subject, under the 1933 Act,
the Exchange Act or otherwise, insofar as such Claim arises out of or is based
upon any Violation, in each case to the extent (and only to the extent) that
such Violation occurs in reliance upon and in conformity with written
information furnished to the Company by such Buyer expressly for use in
connection with such Registration Statement; and such Buyer will reimburse any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 5(o) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the
prior written consent of such Buyer, which consent shall not be
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Private Placement Subscription Agreement
August 15, 1995
Page 10
unreasonably withheld; provided, further, however, that the Buyer shall be
liable under this Section 5(o) for only that amount of a Claim as does not
exceed the net proceeds to such Buyer as a result of the sale of Registrable
Shares pursuant to such Registration Statement. Such investigation made by or
on behalf of such Indemnified Party and shall survive the transfer of the
Registrable Shares by the Buyers. Notwithstanding anything to the contrary
contained herein the indemnification agreement contained in this Section 5(o)
with respect to any preliminary prospectus shall not inure to the benefit of
any Indemnified Party if the untrue statement or omission of material fact
contained in the preliminary prospectus was corrected on a timely basis in the
prospectus, as then amended or supplemented.
p. Promptly after receipt by an Indemnified Person or
Indemnified Party under this Section 5(n) and 5(o) of notice of the
commencement of any action (including any governmental action), such
Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is
made against any indemnifying party under this Section 5, deliver to the
indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying parties; provided, however, that an
Indemnified Person or Indemnified Party shall have the right to retain its own
counsel, with the fees and expenses to be paid by the indemnifying party, if,
in the reasonable opinion of counsel retained by the indemnifying party, the
representation by such counsel of the Indemnified Person or Indemnified Party
and the indemnifying party would be inappropriate due to actual or potential
differing interests between such Indemnified Person or Indemnified Party and
any other party represented by such counsel in such proceeding. The Company
shall pay for only one separate legal counsel for the Buyer(s); such legal
counsel shall be selected by the Buyer(s) holding a majority in interest of the
Registrable Securities. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 5, except to the
extent that the indemnifying party is prejudiced in its ability to defend such
action. The indemnification required by this Section 5 shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as such expense, loss, damage or liability is incurred and is due
and payable.
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Private Placement Subscription Agreement
August 15, 1995
Page 11
6. TRANSFER AGENT INSTRUCTIONS.
Promptly following the delivery by the Buyer of the aggregate
subscription price for the Shares in accordance with Section I(c) hereof, the
Company's transfer agent will be instructed by the Company to issue one or more
certificates representing in total the Shares, bearing the restrictive legend
specified in Section 4(b) of this Agreement, registered in the name of the
Buyer or his nominee and in such denominations as shall be specified in writing
by the Buyer prior to the Closing Date. The Company warrants that no
instruction other than such instructions referred to in this Section 6 and stop
transfer instructions to give effect to Section 4(a) hereof will be given by
the Company to the transfer agent and that the Shares shall otherwise be freely
transferable on the books and records of the Company as and to the extent
provided in this Agreement. Nothing in this Section shall affect in any way the
Buyer's obligations and agreement to comply with all applicable Securities laws
upon resale of the Shares. If the Buyer provides the Company with an opinion of
counsel reasonably satisfactory in form, scope and substance to the Company
that registration of a resale by the Buyer of any of the Shares in accordance
with Section 4(a) is not required under the 1933 Act, the Company shall permit
the transfer agent to issue one or more share certificates in such name and in
such denominations as specified by the Buyer.
7. CLOSING DATE.
The effective date and time of the issuance and sale of the Shares
(the "Closing Date") shall be 9:00 a.m. , Dallas time, on the first business
day following the date on which the Buyer has paid the aggregate subscription
price for the Shares in accordance with Section 1(c) hereof, to the Company and
the Company shall have delivered the Shares to the Buyer in accordance with
Section 1(d) hereof
8. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.
The Buyer understands that the Company's obligation to sell the Shares
to the Buyer pursuant to this Agreement is conditioned upon:
a. The receipt and acceptance in its sole and absolute discretion
by the Company of this Subscription Agreement from the Buyer for the Shares as
evidenced solely by the execution and delivery to Buyer of this Agreement by
the Company;
b. Timely delivery by the Buyer to the Company of good funds as
payment in full of an amount equal to the aggregate subscription price for the
Shares in accordance with Section 1(d) hereof, and
c. The accuracy on the Closing Date of the representations and
warranties of the Buyer
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Private Placement Subscription Agreement
August 15, 1995
Page 12
contained in this Agreement and the performance by the Buyer on or before the
Closing Date of all covenants and agreements of the Buyer required to be
performed on or before such Closing Date.
9. CONDITIONS TO THE BUYER'S OBLIGATION TO PURCHASE.
The Company understands that the Buyer's obligation to purchase
the Registerable Shares is conditioned upon:
a. Delivery by the Company to the Buyer of this Agreement duly
executed by the Company in acceptance thereof;
b. The accuracy on the Closing Date of the representations and
warranties of the Company contained in this Agreement and the performance by
the Company on or before the Closing Date of all covenants and agreements of
the Company required to be performed on or before such Closing Date; and
c. On the Closing Date, the Buyer shall have received an opinion
of counsel from the Company, in the form as set forth in Annex I attached
hereto.
10. GOVERNING LAW; MISCELLANEOUS. This Agreement shall be governed
by and interpreted in accordance with the laws of the State of Texas. A
facsimile transmission of this signed agreement shall be legal and binding on
all parties hereto. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement. If any provision of this Agreement shall be invalid or unenforceable
in any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Agreement or the validity
or enforceability of this Agreement or the validity or enforceability of this
Agreement in any other jurisdiction. This Agreement may be amended only by an
instrument in writing signed by the party to be charged with enforcement. Any
notices required or permitted to be given under the terms of this Agreement
shall be sent by mail or delivered personally or by courier and shall be
effective five (5) days after being placed in the mail, if mailed, or upon
receipt, if delivered personally or by courier, in each case addressed to a
party at such party's address shown in the introductory paragraph or on the
signature page of this Agreement or such other address as a party in accordance
with this provision.
11. NO OFFER TO SELL. This Agreement shall not be construed nor
interpreted as any offer by the Company to sell the Shares. The Company shall
have no obligation to accept this Subscription Agreement if offered by the
Buyer and may in the Company's sole discretion elect to reject this
Subscription Agreement. The Company shall have no obligation nor liability to
the Buyer nor any other party should the Company in its sole and absolute
discretion not accept this Subscription Agreement.
13
Private Placement Subscription Agreement
August 15, 1995
Page 13
12. ENTIRE UNDERSTANDING. This Agreement (including the
attachments hereto) constitutes the entire understanding of the parties hereto
with respect to the subject matter hereof and supersedes any and all prior
agreements, whether written or oral. This Agreement may be amended only in a
written document duly executed by both parties hereto.
IN WITNESS WHEREOF, this Agreement has been duly executed by the Buyer
or one of its officers thereunto duly authorized as of the date set forth
below.
NUMBER OF SHARES: 700,000
PRICE PER SHARE: $1.125
AGGREGATE SUBSCRIPTION PRICE: $787,500
NAME OF BUYER: Xxxxxx X. Xxxxxxx
SIGNATURE: /s/ XXXXXX X. XXXXXXX
Title: XXXXXX X. XXXXXXX
Date: August 19, 1995
Address: 0000 Xxxxxxxxx Xx.
Xxxxxx, XX 00000
IRS TAXPAYER NO.: ###-##-####
14
Private Placement Subscription Agreement
August 15, 1995
Page 14
This Agreement has been accepted by the Company as of the date
set forth below (the "Acceptance Date").
HARKEN ENERGY CORPORATION
By: /s/ XXXXX X. XXXX
Title: Sr. Vice President
Date: August 21, 1995
---------------------------------
(1) The Average Price as defined in Section 1(b) was $1.50.
