EXHIBIT 99.1
FORM OF
SUBSCRIPTION AND REGISTRATION RIGHTS AGREEMENT
This Subscription and Registration Rights Agreement (this "Agreement"),
made as of the date set forth below by and between Carrizo Oil & Gas, Inc. (the
"Company") and the undersigned (the "Subscriber" and, together with the other
subscribers for Shares (as defined below), the "Subscribers") is intended to set
forth certain representations, covenants and agreements between the Company and
the Subscriber with respect to the offering (the "Offering") for sale by the
Company of up to 1,200,000 shares (the "Shares") of common stock, par value
$0.01 per share (the "Common Stock"), as described in the Company's Confidential
Private Placement Memorandum dated June 7, 2005, as supplemented (the
"Memorandum"), a copy of which has been delivered to the Subscriber. The Shares
are being offered by the Company through Hibernia Southcoast Capital, Inc., as
the Company's managing placement agent (the "Placement Agent").
1. Subscription. Subject to the terms and conditions hereof, the
Subscriber hereby irrevocably subscribes for and agrees to purchase from the
Company the number of Shares set forth under the Subscriber's name on the
signature page hereto at a purchase price of $15.25 per share (the "Offering
Price"), and the Company agrees to sell such Shares to the Subscriber at the
Offering Price, subject to the Company's right to sell to the Subscriber such
lesser number of Shares as the Company may, in its sole discretion, deem
necessary or desirable.
2. Delivery of Subscription Amount; Acceptance of Subscription; Delivery
of Shares. The Subscriber understands, acknowledges and agrees that this
subscription is made subject to the following terms and conditions:
(a) The Subscriber understands that separate subscription agreements
may be executed with other Subscribers for any remaining Shares to be sold
in the Offering;
(b) The Subscriber must be an institution that is (i) currently a
security holder of the Company and (ii) an "accredited investor" as
defined in Rule 501(a)(1), (2), (3), (7) or (8) of Regulation D under the
Securities Act of 1933, as amended (the "Securities Act");
(c) Contemporaneously with the completion, execution and delivery of
this Agreement, the Subscriber shall complete, execute and deliver, in
accordance with the instructions set forth on Exhibit A attached hereto,
the Certificate of Accredited Investor Status attached hereto as Exhibit
B. Contemporaneously with or prior to Closing (as defined below), the
Subscriber shall wire to the Company to hold in a separate,
non-interest-bearing account, immediately available United States funds in
the amount equal to the Offering Price multiplied by the number of Shares
for which the Subscriber has subscribed (the "Subscription Amount") in
accordance with the instructions set forth on Exhibit A attached hereto;
(d) The Company is offering for sale up to 1,200,000 Shares at the
Offering Price, for an aggregate price of the Offering of up to $15.25;
(e) The Subscriber shall have the right to cancel the Subscriber's
subscription and
withdraw the proceeds representing the Subscription Amount at any time
during the Offering if the Closing shall not have occurred prior to June
15, 2005;
(f) The subscription for Shares shall be deemed to be accepted only
when this Agreement has been signed by an authorized executive officer of
the Company, on behalf of the Company. The deposit of the Subscription
Amount for clearance will not be deemed an acceptance of this Agreement;
(g) The Subscriber understands and acknowledges that (i) the Company
has the unconditional right, exercisable in its sole and absolute
discretion, to accept or reject the subscriber's subscription for Shares,
in whole or in part, (ii) subscriptions need not be accepted by the
Company in the order received by the Company, (iii) all subscriptions are
subject to prior sale, withdrawal, modification or cancellation of the
Offering by the Company, (iv) no subscription shall be valid unless and
until accepted by the Company, (v) the Subscriber's subscription for
Shares shall be deemed to be accepted by the Company only when this
Agreement is signed by an authorized executive officer of the Company, on
behalf of the Company, (vi) the Company shall have the right to allocate
Shares among the Subscribers in any manner it may desire; provided,
however, that no Subscriber shall be obligated to purchase more than the
number of Shares set forth under its name on the signature page hereto
without its prior written consent, and (vii) notwithstanding anything in
this Agreement to the contrary, the Company shall have no obligation to
issue Shares to any person to whom the issuance of Shares would constitute
a violation of the Securities Act or any state securities laws;
(h) The payment of the Subscription Amount (or, in the case of
rejection of a portion of the Subscriber's subscription, the part of the
payment relating to such rejected portion) will be returned promptly,
without interest, if the Subscriber's subscription is rejected in whole or
in part or if the Offering is withdrawn or canceled;
(i) Certificates representing the Shares purchased will be issued in
the name of each Subscriber as soon as reasonably practicable on or after
Closing as set forth under Section 3 hereof;
(j) The Offering is being conducted on a "best efforts" basis, and
the Company is not required to accept any minimum aggregate amount of
subscriptions before conducting a Closing; and
(k) The representations and warranties of the Company and the
Subscriber set forth herein shall be true and correct as of the date that
the Company accepts this subscription.
3. Terms of Subscription.
(a) The subscription period will begin as of June 7, 2005 and will
terminate at 11:59 p.m. Eastern Time on June 20, 2005, unless extended by
the Company, on one or more occasions for up to an additional 60 days (the
"Termination Date"), which extension may be effected without notice to the
Subscribers. The purchase and sale of the Shares (the "Closing") shall
occur as soon as practicable after the execution of this Agreement by the
Company and each of the Subscribers in the Offering at a time (the
"Closing Date") and location agreed upon by the Company and the Placement
Agent. As soon as reasonably
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practicable on or after the Closing Date, the Company will deliver or
cause to be delivered, one or more physical certificates representing the
Shares purchased by each Subscriber.
(b) In consideration of the Placement Agent's services rendered to
the Company as its managing placement agent in connection with the
Offering, the Company will pay the Placement Agent a fee equal to five
percent (5%) of the gross proceeds received by the Company in connection
with the sale of Shares in the Offering. The Subscriber understands that
the Company will also pay all of the Placement Agent's expenses in
connection with the Offering as previously agreed upon by the Company and
the Placement Agent.
4. Registration Rights.
(a) Within 30 days after the Closing Date, or within such 30-day
period as extended by such additional number of days as are attributable
to any delay caused by any act or failure to act by any of the Subscribers
or their counsel, the Company shall use its commercially reasonable
efforts to prepare and file with the Securities and Exchange Commission
(the "SEC"), a registration statement (the "Registration Statement") and
such other documents as may be necessary or appropriate in the opinion of
counsel for the Company and shall use its commercially reasonable efforts
to have such Registration Statement declared effective as soon as
practicable after the filing date in order to comply with the provisions
of the Securities Act, so as to permit the registered resale or other
disposition of the Shares for a period of two (2) years following the
Closing Date by each and every holder of Shares sold in the Offering
except for those holders who designate on the signature page hereto that
they do not wish to have their Shares included in the Registration
Statement. The Shares that are registered for resale under such
Registration Statement are referred to herein as the "Offering Shares,"
and the Subscribers who are eligible to sell their Shares under such
Registration Statement, together with their respective affiliates, are
hereafter referred to as "Offering Holders." The Company will include in
such Registration Statement (i) the information required under the
Securities Act to be so included concerning the Offering Holders, as
provided by the Offering Holders on the signature pages to this Agreement
and the other Subscription and Registration Rights Agreements entered into
in connection with the Offering, including the information specified by
Items 507 and 508 of Regulation S-K under the Securities Act and any
changes in such information that may be provided by the Offering Holders
in writing to the Company from time to time, and (ii) a section entitled
"Plan of Distribution," substantially in the form of Exhibit C attached
hereto (with such changes thereto as may be required by the SEC or
otherwise as may be required to comply with applicable law or regulation),
that describes the various procedures that may be used by the Offering
Holders in the sale of Offering Shares.
(b) In the event that the Company does not file a Registration
Statement to register the Offering Shares with the SEC within thirty (30)
days following the closing of the Offering, or within such 30-day period
as extended by such additional number of days as are attributable to any
delay caused by any act or failure to act by any of the Subscribers or
their counsel, the Company will be required to pay liquidated damages to
each Offering Holder equal to one percent (1%) of such Offering Holder's
purchase price ($15.25 per Share) for the Offering Shares, and an
additional one percent (1%) of such Offering Holding's purchase price
($15.25 per Share) for the Offering Shares for each additional 30-day
period during
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which such Registration Statement is not filed.
(c) Notwithstanding the foregoing provisions of this Section 4, the
Company may voluntarily suspend the effectiveness of any such Registration
Statement for a limited time or may otherwise require the discontinuance
of offers and transfers under the Registration Statement, which in no
event shall be longer than 30 days in any three-month period and no longer
than 60 days in any twelve month period, if (i) the Company has been
advised by counsel or underwriters to the Company that the offering of any
Offering Shares pursuant to the Registration Statement would materially
adversely affect, or would be improper in view of (or improper without
disclosure in a prospectus), a proposed financing, a reorganization,
recapitalization, merger, consolidation, or other transaction involving
the Company or (ii) any event occurs that would cause any such
Registration Statement to contain a material misstatement or omission or
not to be effective and usable during the period that such Registration
Statement is required to be effective and usable (in either case, a
"Suspension"). The Company shall be deemed to be in breach of this
Agreement if it shall require any Suspension in excess of the time periods
set forth above. The Company shall notify all Offering Holders of any
Suspension and, upon receipt of such notice, each such Offering Holder
will discontinue any offers or transfers sales of Offering Shares pursuant
to the Registration Statement until such Offering Holder has received
copies of a supplemented or amended prospectus or until such Offering
Holder is advised in writing by the Company that the then current
prospectus may be used. In the event of a Suspension as described in
clause (ii) above, the Company shall promptly notify the Offering Holders
to that effect and, if requested, the Offering Holders shall immediately
cease making offers or transfers of Offering Shares and return all
prospectuses to the Company. The Company shall promptly file a supplement
or an amendment to the Registration Statement or a document incorporated
by reference into the Registration Statement to correct such misstatement
or omission and use its commercially reasonable efforts to cause any such
amendment to be declared effective as soon as practicable thereafter. The
Company shall promptly provide the Offering Holders with revised
prospectuses and, following receipt of the revised prospectuses, the
Offering Holders shall be free to resume making offers of the Offering
Shares. Notwithstanding any provision contained herein to the contrary,
the Company's obligation to include, or continue to include, Offering
Shares in the Registration Statement under this Section 4 shall terminate
to the extent such Offering Shares are eligible for resale under Rule
144(k) promulgated under the Securities Act.
(d) If and whenever the Company is required by the provisions of
this Agreement to use its commercially reasonable efforts to effect the
registration of the Offering Shares under the Securities Act for the
account of an Offering Holder, the Company will, in addition, as promptly
as practicable:
(i) use commercially reasonable efforts to prepare and file
with the SEC, promptly upon the reasonable request of any
Subscriber, such amendments and supplements to such Registration
Statement and the prospectus used in connection therewith as may be
necessary to keep such Registration Statement effective and to
comply with the requirements of the Securities Act and the rules and
regulations promulgated by the SEC thereunder relating to the sale
or other disposition of the securities covered by such Registration
Statement; and
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(ii) furnish to each Offering Holder such numbers of copies of
a prospectus, complying with the requirements of the Securities Act,
and such other documents as such Offering Holder may reasonably
request in order to facilitate the public sale or other disposition
of the Offering Shares owned by such Offering Holder, but such
Offering Holder shall not be entitled to use any selling materials
other than a prospectus and such other materials as may be approved
by the Company, which approval will not be unreasonably withheld.
(e) At any time when a prospectus relating to the Offering is
required to be delivered under the Securities Act:
(i) the Company will notify the Offering Holder, upon the
awareness of an executive officer of the Company, if the prospectus
included in such Registration Statement, as then in effect, includes
an untrue statement of material fact or omits to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then
existing. Upon receipt of such notice, the Offering Holders will
make no further sales or other dispositions, or offers therefor, of
Offering Shares under the Registration Statement until they receive
from the Company copies of a new, amended or supplemented prospectus
complying with the Securities Act or until the Company has filed an
appropriate report with the SEC pursuant to the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), which filing shall be
made as promptly as reasonably practicable; and
(ii) the Subscriber will notify the Company of the happening
of any event relating to the Subscriber as a result of which the
prospectus included in such Registration Statement, as then in
effect, includes an untrue statement of material fact or omits to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the
circumstances then existing, and the Subscriber shall promptly make
available to the Company information necessary to enable the Company
to prepare a new, amended or supplemented prospectus or to file an
appropriate report with the SEC pursuant to the Exchange Act which
preparation or filing shall be made as soon as reasonably
practicable.
(f) The Subscriber agrees not to take any action with respect to any
distribution deemed to be made pursuant to such Registration Statement
that constitutes a violation of Regulation M under the Exchange Act or any
other applicable rule, regulation or law.
(g) The Subscriber acknowledges and agrees that in the event of
sales under a Registration Statement pursuant to this Agreement, the
Offering Shares sold pursuant to such Registration Statement are not
transferable on the books of the Company unless the share certificate
submitted to the transfer agent evidencing such Offering Shares is
accompanied by a certificate reasonably satisfactory to the Company to the
effect that (A) the Offering Shares have been sold in accordance with such
Registration Statement and (B) the requirement of delivering a current
prospectus has been satisfied.
(h) The Subscriber acknowledges and agrees that it will keep
confidential all nonpublic information it receives in connection with this
Agreement and that such information be neither used for the Subscriber's
personal benefit (other than in connection
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with the subscription) nor disclosed to any third party for any reason.
This shall include, without limitation, the receipt of any notice of any
suspension of the offering and sale of the Offering Shares pursuant to the
provisions of Section 4(c) hereof in the event the Company notifies the
Subscriber that such notice constitutes material nonpublic information;
provided, however, that the number of days during which the Subscriber
must keep confidential such information or any other information it
receives from the Company in connection with this Agreement that the
Company designates as material nonpublic information shall be counted
toward the satisfaction of the 30- and 60-day periods of voluntary
suspension set forth in Section 4(c) (with any such days prior to the date
of effectiveness of the Registration Statement being counted toward the
satisfaction of the voluntary suspension periods during the first 30 days
or 12 months, as the case may be, following effectiveness). This Section
4(h) shall not apply to any information that is or becomes publicly
available through no fault of the Subscriber or that the Subscriber is
legally required to disclose by a governmental entity or other third
party; provided, however, that if the Subscriber is requested or ordered
to disclose any such information pursuant to any court or other government
order or any other applicable legal procedure, it shall cooperate with the
Company and provide the Company with prompt notice of any such request or
order, unless the Subscriber is legally prohibited from providing such
notice, in time sufficient to enable the Company to seek an appropriate
protective order. The Company acknowledges and agrees that upon and at the
time of the filing of the Form 8-K described in Section 5(v), the
Subscriber shall not be in possession of any material nonpublic
information related to this Agreement.
(i) Except as provided below in this Section 4, the expenses
incurred by the Company in connection with action taken by the Company to
comply with this Section 4, including, without limitation, all
registration and filing fees, printing and delivery expenses, accounting
fees, fees and disbursements of counsel to the Company, consultant and
expert fees, premiums for liability insurance, if the Company chooses to
obtain such insurance, obtained in connection with a registration
statement filed to effect such compliance and all expenses, including
counsel fees, of complying with any state securities laws, shall be paid
by the Company; provided, however, that each Offering Holder shall bear
its own selling expenses, brokerage fees, commissions and similar payments
and transfer taxes attributable to the Offering Shares being sold by such
Offering Holder and shall bear fees and expenses of its own counsel and
other advisors, if any.
(j) In the event of any registration of Shares pursuant to this
Section 4, the Company will, to the maximum extent permitted by law,
indemnify and hold harmless each Offering Holder and each person, if any,
who controls an Offering Holder within the meaning of Section 15 of the
Securities Act (collectively, the "Indemnified Parties") against any
losses, claims, damages, or liabilities, joint or several, to which any of
such Indemnified Parties may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) are caused by any untrue statement of any
material fact contained in the registration statement, any prospectus
contained therein, or any amendment or supplement thereof, or arising out
of or based upon the omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading and will reimburse such Indemnified Parties for any reasonable
legal or other expenses they incur in connection with investigating or
defending against any such loss, claim, damage, liability or action;
provided, however, that the Company will not be
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liable to the extent that any such loss, claim, damage, expense or
liability arises out of, or is based upon, an untrue statement or alleged
untrue statement or omission or alleged omission so made in conformance
with information that has been furnished in writing by such indemnified
party in accordance with Section 5(l) hereof; and, provided further, that
the Company shall not be required to provide such indemnification if such
loss, claim, damage or liability (or action in respect thereof) arises out
of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in any final prospectus and if, in
respect to such statement, alleged statement, omission or alleged
omission, a more current prospectus corrected such statement or omission
and was delivered to the Offering Holder and a copy of such more current
prospectus had not been sent or given at or prior to the confirmation of
the sale with respect to which such loss, claim, damage, expense or
liability relates. The indemnification provided for herein shall be
applicable, regardless of whether any such losses, claims, damages, or
liabilities result solely or in part from the active, passive or
concurrent negligence or strict liability of the indemnitee.
(k) In the event of any registration of Shares pursuant to this
Section 4, the Subscriber will, to the maximum extent permitted by law,
indemnify and hold harmless the Company, each of its directors, each of
its officers who has signed the Registration Statement, and each person,
if any, who controls the Company, within the meaning of the Securities Act
(collectively, the "Indemnified Persons"), against any loss, claim, damage
or liability of which the Company or any such Indemnified Person may be or
become subject under the Securities Act or otherwise, insofar as such
loss, claim, damage or liability (or action in respect thereof) is caused
by any untrue statement of any material fact contained in the Registration
Statement, such prospectus, or amendment or supplement thereof, or arises
out of or is based upon the omission to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading, or arises out of or is based on any failure by the
Subscriber to comply with the covenants or agreements contained in this
Agreement with respect to Offering Shares, in each case to the extent, but
only to the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission relates to the information that has been
furnished in writing by such Subscriber in accordance with Section 5(l)
hereof and will reimburse the Company and each such officer, director and
controlling person for any reasonable legal or other expenses they incur
in connection with investigating or defending against any such loss,
claim, damage, liability or action. The indemnification provided for
herein shall be applicable, regardless of whether any such losses, claims,
damages, or liabilities result solely or in part from the active, passive
or concurrent negligence or strict liability of the indemnitee.
(l) Promptly after receipt by an indemnified party as described in
Section 4(j) or 4(k) hereof of notice of the commencement of any action,
such indemnified party will, if a claim thereof is to be made against the
indemnifying party pursuant thereto, notify the indemnifying party of the
commencement thereof, but the omission to notify the indemnifying party
will not relieve it from any liability which it may have to any
indemnified party except to any extent to which the indemnifying party is
actually prejudiced thereby. In case such action is brought against any
indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate in, and, to the extent that it may wish, jointly with any
other indemnifying party, similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such
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indemnified party. An indemnified party shall not be liable for any
settlement of an action or claim effected without its written consent
(which shall not be unreasonably withheld or delayed). An indemnifying
party who is entitled to, or elects to, assume the defense of a claim
shall have the right to employ its counsel in such claim or action, unless
in the reasonable judgment of any indemnified party a conflict of interest
may exist between such indemnified party and any other of such indemnified
parties with respect to such claim that makes the representation by such
counsel inappropriate, in which case the indemnifying party shall select
separate counsel for such indemnified party reasonably acceptable to such
indemnified party; provided, however, that the indemnifying party will not
be obligated to pay the fees and expenses of more than one counsel (other
than local counsel as reasonably required) for all parties indemnified by
such indemnifying party with respect to such claim.
(m) If the indemnification provided for in Section 4(j) or Section
4(k) hereof is unavailable to an indemnified party thereunder in respect
to any losses, claims, damages, liabilities or expenses referred to
therein, then each indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities
or expenses in such proportion as is appropriate to reflect the relative
fault of the Company, on the one hand, and all shareholders offering
securities via the Registration Statement (the "Selling Shareholders"), on
the other hand, in connection with the statements or omissions that
resulted in such losses, claims, damages, liabilities or expenses, as well
as any other relevant equitable considerations. The relative fault of the
Company on the one hand and the Selling Shareholders on the other shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of material facts or the omission or alleged
omission to state a material fact relates to information supplied by the
Company or by the Selling Shareholders and the parties' relative intent,
knowledge, access to information and opportunity to correct such statement
or omission. The Company and the Selling Shareholders agree that it would
not be just and equitable if contribution pursuant to this Section 4(m)
were based solely on the number of entities from whom contribution was
requested or by any other method of allocation that does not take account
of the equitable considerations referred to above in this Section 4(m).
The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, expenses and liabilities referred to above in
this Section 4(m) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim, subject to the
provisions of Section 4(l) hereof. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.
(n) Notwithstanding any other provision of this Agreement, the
liability of the Subscriber for indemnification or contribution under this
Agreement shall not exceed an amount equal to the number of Shares sold by
the Subscriber under the Registration Statement multiplied by the net
amount per Share received in such sale(s). The indemnification and
contribution provided for under this Agreement shall remain in full force
and effect regardless of any investigation made by or on behalf of the
indemnified party or any officer, director or controlling person of such
indemnified party and shall survive the transfer of securities.
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(o) The Company agrees to file, within the time period provided by
applicable rules of the NASDAQ Stock Market, a notification form relating
to the listing the Shares on that market.
(p) The Subscriber acknowledges that the Company is a party to (a)
that certain Registration Rights Agreement dated as of December 15, 1999
with the purchasers named therein, (b) that certain Amended and Restated
Registration Rights Agreement dated as of December 15, 1999 with the
purchasers named therein, (c) that certain Registration Rights Agreement
dated as of February 20, 2002 with the purchasers named therein and (d)
that certain Registration Rights Agreement dated as of April 18, 2005
between the Company and Panamerican Operating, Inc. (the purchasers named
in these four agreements, collectively, the "Prior Purchasers") pursuant
to which the Company has granted the Prior Purchasers certain registration
rights and agreed upon specified restrictions to the Company's grant of
registration rights to subsequent shareholders. The Subscriber also
acknowledges that the Company may grant purchasers ("Future Purchasers")
in a subsequent offering of additional shares of Common Stock certain
registration rights prior to the filing of the Registration Statement. The
Subscriber acknowledges and agrees that the Company may include the
registrable securities of such Prior Purchasers and Future Purchasers and
shares to be sold be the Company in the Registration Statement required by
this Section 4 and that no Subscriber shall have the right to include its
Offering Shares in any registration or underwriting initiated by the Prior
Purchasers or, except as specifically contemplated by Section 4(a) hereof,
by the Company.
(q) The Company agrees to use its reasonable best efforts, upon
resale of the Offering Shares ("Resold Shares") by an Offering Holder
pursuant to an effective Registration Statement, to deliver to such
Offering Holder a certificate evidencing such Resold Shares free of any
restrictive legends or to provide required letters of instruction within
three business days of the Company's receipt from the Offering Holder of
notice of such resale; provided, that no such delivery relating to Resold
Shares shall be required until the Company has received from the Offering
Holder any reasonably required legal opinion, transfer taxes, if any, or
any other such documentation.
5. Representations and Warranties of the Subscriber. The Subscriber hereby
represents and warrants to, and covenants and agrees with, each of the Company
and the Placement Agent as follows:
(a) The Subscriber is acquiring the Shares for its own account and
for the purpose of investment and not with a view to, or for resale in
connection with, any distribution or public offering thereof within the
meaning of the Securities Act and applicable state securities laws.
(b) The Subscriber understands that:
(i) the Shares (A) have not been registered under the
Securities Act or any state securities laws, (B) will be issued in
reliance upon an exemption from the registration and prospectus
delivery requirements of the Securities Act pursuant to Section 4(2)
and/or Regulation D thereof and (C) will be issued in reliance upon
exemptions from the registration and prospectus delivery
requirements of state securities laws which relate to
9
private offerings;
(ii) the Subscriber must therefore bear the economic risk of
such investment indefinitely unless a subsequent disposition thereof
is registered under the Securities Act and applicable state
securities laws or is exempt therefrom;
(iii) such exemptions depend upon, among other things, the
bona fide nature of the investment intent of the Subscriber
expressed herein;
(iv) any transfer of participations in the Shares or any
arrangement for an economic interest in the Shares to be held or
owned by anyone other than the Subscriber will constitute a
violation of this representation and will be null and void; and
(v) the Company is not assuming any obligation to repurchase
or, except as expressly set forth herein, to register the transfer
of any portion of the Shares under the Securities Act or under any
state securities law;
(c) The Subscriber acknowledges that the certificates representing
the Shares acquired by the Subscriber shall bear a restrictive legend
substantially as follows and agrees to comply with the terms of the
restrictive legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON TRANSFER UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND STATE SECURITIES LAWS, AND MAY NOT BE OFFERED FOR SALE,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF UNLESS
(I) REGISTERED UNDER THE APPLICABLE SECURITIES LAWS OR (II) AN
OPINION OF COUNSEL, WHICH OPINION AND COUNSEL ARE BOTH REASONABLY
SATISFACTORY TO THE COMPANY, HAS BEEN DELIVERED TO THE COMPANY AND
SUCH OPINION STATES THAT THE SHARES MAY BE TRANSFERRED WITHOUT SUCH
REGISTRATION. ADDITIONALLY, THE TRANSFER OF SUCH SHARES IS SUBJECT
TO COMPLIANCE WITH THE TERMS OF AN AGREEMENT WITH THE COMPANY DATED
JUNE 7, 2005, AND NO TRANSFER OF SUCH SHARES WILL BE VALID WITHOUT
SUCH COMPLIANCE. A COPY OF SUCH AGREEMENT WILL BE PROVIDED BY THE
COMPANY UPON REQUEST."
(d) The Subscriber will not sell or transfer the Shares unless:
(i) there is then in effect a Registration Statement under the
Securities Act covering such proposed disposition and such
disposition is made in accordance with such Registration Statement;
or
(ii) it shall have notified the Company of the proposed
disposition and shall have furnished the Company with an opinion of
counsel, which opinion and counsel both
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are reasonably satisfactory to the Company, that such disposition is
exempt from registration of such shares under the Securities Act or
any applicable state, foreign or other securities laws.
(e) The Subscriber has knowledge, skill and experience in financial,
business and investment matters relating to an investment of this type and
is capable of evaluating the merits and risks of such investment and
protecting the Subscriber's interest in connection with the acquisition of
the Shares. The Subscriber understands that the acquisition of the Shares
is a speculative investment and involves substantial risks and that the
Subscriber could lose the Subscriber's entire investment in the Shares.
Further, the Subscriber has carefully read and considered the matters set
forth under the section entitled "Risk Factors" in the Memorandum and has
taken full cognizance of and understands all of the risks related to the
purchase of the Shares. To the extent deemed necessary by the Subscriber,
the Subscriber has retained, at its own expense, and relied on,
appropriate professional advice regarding the investment, tax and legal
merits and consequences of purchasing and owning the Shares. The
Subscriber has the ability to bear the economic risks of the Subscriber's
investment in the Company, including a complete loss of the investment,
and the Subscriber has no need for liquidity in such investment, which
investment is not disproportionate to the Subscriber's net worth.
(f) The Subscriber has been furnished by the Company all information
(or has been provided by the Company access to all information) regarding
the business and financial condition of the Company, its expected plans
for future business activities, the attributes of the Shares and the
merits and risks of an investment in the Shares which the Subscriber has
requested or otherwise needs to evaluate the investment in the Company.
(g) The Subscriber is in receipt of and has carefully read and
understands the following items:
(i) Annual Report on Form 10-K for the fiscal year ended
December 31, 2004, filed by the Company with the SEC on March 31,
2005, as amended by that certain Form 10-K/A filed by the Company
with the SEC on May 2, 2005;
(ii) Definitive Proxy Statement on Schedule 14A filed by the
Company with the SEC on April 19, 2005;
(iii) Quarterly Report on Form 10-Q for the fiscal quarter
ended March 31, 2005 filed by the Company with the SEC on May 10,
2005;
(iv) Current Reports on Form 8-K filed by the Company with the
SEC on April 22, 2005, April 28, 2005, May 3, 2005 and June 3, 2005;
and
(v) Confidential Private Placement Memorandum, dated June 7,
2005, the supplement thereto and the items attached thereto (the
Memorandum, collectively with Attachments (A) through (E) thereto
and together with all exhibits with those Attachments and
incorporated by reference therein, the "Disclosure Documents").
(h) In making the proposed investment decision, the Subscriber is
relying solely on investigations made by the Subscriber and the
Subscriber's representatives, if any, and not on
11
the Company, the Placement Agent or their respective counsel for an
evaluation of the investment, tax and legal merits and consequences of
purchasing and owning the Shares. The Subscriber acknowledges that the
documents and other information listed in Section 5(g) hereof are the only
information provided to the Subscriber by the Company or the Placement
Agents and that the Subscriber is not relying on any other information in
making the proposed investment decision. The offer to sell the Shares was
communicated to the Subscriber in such a manner that the Subscriber was
able to ask questions of and receive answers from the management of the
Company concerning the terms and conditions of the proposed transaction.
(i) No securities were offered or sold to the Subscriber by means of
any form of general solicitation or general advertising contemplated by
Rule 502(c) under the Securities Act including, but not limited to, any
advertisement, article, leaflet, public promotional meeting, notice or
other communication published in any newspaper, magazine or similar media
or broadcast over television or radio or presented at any seminar or
meeting or any other form of general public advertising or solicitation.
Without limiting the generality of the foregoing, the Subscriber confirms
that it has a prior substantive relationship with either the Company or
the Placement Agent that preexists the transactions contemplated hereby.
No presentation or meeting at any investor conference or similar activity
constituted a general solicitation as to the offering of common stock to
Subscribers or played a role in Subscriber's investment in the Shares.
(j) The Subscriber acknowledges that statements the Company has made
in the Disclosure Documents and other information the Subscriber has
received, if any, including oral statements, include forward-looking
statements about the Company's future business operations, financial
projections and other matters. Those statements speak only as of the date
made, are not guarantees of future financial performance and involve known
and unknown risks and other factors that could case actual results to be
materially different from any future results expressed or implied by those
statements.
(k) The Subscriber acknowledges that the Subscriber has been advised
that:
(i) The Shares offered hereby have not been approved or
disapproved by the SEC or any state securities commission nor has
the SEC or any state securities commission passed upon the accuracy
or adequacy of any representations by the Company. Any
representation to the contrary is a criminal offense.
(ii) In making an investment decision, the Subscriber must
rely on its own examination of the Company and the terms of the
Offering, including the merits and risks involved. The Shares have
not been recommended by any federal or state securities commission
or regulatory authority. Furthermore, the foregoing authorities have
not confirmed the accuracy or determined the adequacy of any
representation. Any representation to the contrary is a criminal
offense.
(iii) The Shares are "Restricted Securities" within the
meaning of Rule 144 under the Securities Act, are subject to
restrictions on transferability and resale and may not be
transferred or resold except as permitted under the Securities Act
and applicable state securities laws, pursuant to registration or
exemption therefrom. The Subscriber is aware
12
that the Subscriber may be required to bear the financial risks of
this investment for an indefinite period of time.
(l) The Subscriber acknowledges and is aware that there has never
been any representation, guarantee or warranty made by the Company or the
Placement Agents or any officer, director, employee or agent or
representative of the Company or the Placement Agents, expressly or by
implication, as to (i) the approximate or exact length of time that the
Subscriber will be required to remain an owner of the Shares; (ii) the
percentage of profit and/or amount of or type of consideration, profit or
loss to be realized, if any, as a result of this investment; or (iii) that
the limited past performance (if any) or experience on the part of the
Company, or any future expectations will in any way indicate the
predictable results of the ownership of the Shares or of the overall
financial performance of the Company.
(m) The Subscriber agrees to furnish the Company and the Placement
Agents such other information as the Company may reasonably request in
order to verify the accuracy of the information contained herein and
agrees to notify the Company and the Placement Agents immediately of any
material change in the information provided herein that occurs prior to
the Company's acceptance of this Agreement. The Subscriber agrees that if
the Subscriber is an Offering Holder, it will promptly furnish to the
Company such information regarding such Offering Holder, the Offering
Shares and the distribution proposed by such Offering Holder as the
Company may reasonably request in writing or as shall be reasonably
required in connection with any registration, qualification or compliance
referred to in this Agreement.
(n) The Subscriber further represents and warrants that the
Subscriber is an institution that (i) is an "accredited investor" within
the meaning of Rule 501(a)(1), (2), (3), (7) or (8) of Regulation D under
the Securities Act, as further described in the Certificate of Accredited
Investor Status attached hereto as Exhibit B, which shall be completed,
executed and delivered by the Subscriber to the Company or the Placement
Agent in accordance with the instructions set forth on Exhibit A attached
hereto, (ii) is a current security holder of the Company and (iii) has a
prior substantive relationship with the Company in existence prior to the
date the Placement Agent or the Company first contacted the Subscriber
regarding the Offering.
(o) As of the date of this Agreement, the Subscriber and its
affiliates do not have, and during the 30 day period prior to the date of
this Agreement the Subscriber and its affiliates have not entered into,
any "put equivalent position" as such term is defined in Rule 16a-1 under
the Exchange Act or short sale positions with respect to the Common Stock
of the Company. Until the Registration Statement referred to in Section
4(a) hereof is declared effective, the Subscriber hereby agrees not to,
and will cause its affiliates not to, enter into any such "put equivalent
position" or short sale position (1) if that put equivalent or short sale
position is covered with any of the Shares it purchases hereunder or (2)
with respect to the Shares that does not comply with applicable law and
regulation.
(p) If this Agreement is executed and delivered on behalf of a
partnership, corporation, trust, estate or other entity (an "Entity"): (i)
such Entity has the full legal right and power and all authority and
approval required (a) to execute and deliver, or authorize execution and
delivery of, this Agreement and all other instruments executed and
delivered
13
by or on behalf of such Entity in connection with the purchase of the
Shares, (b) to delegate authority pursuant to power of attorney and (c) to
purchase and hold the Shares; (ii) the party signing on behalf of such
Entity has all authority to make the agreements contained herein on behalf
of such Entity and the signature of the party signing on behalf of such
Entity is binding upon such Entity; and (iii) such Entity has not been
formed for the specific purpose of acquiring the Shares, unless each
beneficial owner of such Entity is qualified as an accredited investor
within the meaning of Rule 501(a) of Regulation D promulgated under the
Securities Act and has submitted information substantiating such
individual qualification.
(q) If the Subscriber is not a United States person, the Subscriber
hereby represents that it has satisfied itself as to the full observance
of the laws of its jurisdiction in connection with any invitation to
subscribe for the Shares or any use of this Agreement, including, without
limitation, (i) the legal requirements within its jurisdiction for the
purchase of the Shares, (ii) any foreign exchange restrictions applicable
to such purchase, (iii) any governmental or other consents that may need
to be obtained and (iv) the income tax and other tax consequences, if any,
that may be relevant to the purchase, holding, redemption, sale or
transfer of the Shares. The Subscriber represents and warrants that the
Subscriber's subscription and payment for, and the Subscriber's continued
beneficial ownership of, the Shares will not violate any applicable
securities or other laws of the Subscriber's jurisdiction.
(r) If the Subscriber is a retirement plan or is investing on behalf
of a retirement plan, the Subscriber acknowledges that investment in the
Shares poses additional risks, including, without limitation, the
inability to use losses generated by an investment in the Shares to offset
taxable income.
(s) The Subscriber represents and warrants that it is not a
broker-dealer or an affiliate of a broker-dealer.
(t) The Subscriber has not incurred and will not incur, directly or
indirectly, any liability for brokerage or finders' fees or agents'
commissions or any similar charges in connection with this Agreement or
any transaction contemplated hereby.
(u) The Subscriber makes the foregoing representations and
warranties with the intent that the Company and the Placement Agent and
their respective counsel and the Company's transfer agent rely upon them
in determining the Subscriber's suitability as an investor and in
establishing an exemption from registration under the Securities Act and
state securities laws for sale of the Shares to the Subscriber and of
other shares to other persons, and the Subscriber understands that any
inaccuracy of any of its representations and warranties herein could
affect the Company's ability to establish an exemption. The Subscriber
will not take any position inconsistent with any of its representations
and warranties. The Subscriber hereby agrees that such representations and
warranties shall survive its purchase of the Shares. The Subscriber
understands and agrees that the foregoing representations and warranties
are for the benefit of the Company and the Placement Agent and may be
waived by the Company in its discretion as to the Subscriber or any other
subscriber for the Shares.
(v) The Subscriber acknowledges that it previously agreed, and the
Subscriber hereby agrees, to keep confidential and not trade in the
Company's securities on the basis of
14
the nonpublic information in the Confidential Private Placement
Memorandum, including, but not limited to, the fact that the Company is
considering transactions contemplated by this Agreement until such time as
the Company shall have filed with the SEC a current report on Form 8-K
relating to the Offering, which the Company covenants will occur not later
than 8:00 a.m. Eastern Time on the first business day following the
Closing.
6. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Subscriber as follows:
(a) Each of the Company and its subsidiaries is duly incorporated,
validly existing and in good standing under the laws of its state of
incorporation, and is duly qualified to do business as a foreign
corporation in all jurisdictions in which the failure to be so qualified
would materially and adversely affect the business or financial condition,
properties or operations of the Company. Each of the Company and its
subsidiaries has all requisite corporate power and authority (i) to own
and lease the properties and assets it currently owns and leases (if any)
and it contemplates owning and leasing and (ii) to conduct its activities
as such activities (if any) are currently conducted and as currently
contemplated to be conducted.
(b) The authorized capital of the Company immediately prior to the
Closing will consist of: (i) 10,000,000 shares of Preferred Stock, none of
which are issued and outstanding, and (ii) 40,000,000 shares of Common
Stock, 22,749,554 of which were issued and outstanding as of April 6,
2005.
(c) The Company has duly authorized the issuance and sale of the
Shares in accordance with the terms of this Agreement (as described
herein) by all requisite corporate action, including the authorization by
the Company's Board of Directors of the issuance and sale of the Shares in
accordance herewith and the execution, delivery and performance of any
other agreements and instruments executed in connection herewith. This
Agreement constitutes a valid and legally binding obligation of the
Company, enforceable in accordance with its terms, except (i) as limited
by applicable bankruptcy, insolvency, reorganization, moratorium, and
other laws of general application affecting enforcement of creditors'
rights generally, (ii) as limited by laws relating to the availability of
specific performance, injunctive relief, or other equitable remedies, and
(iii) to the extent the indemnification provisions contained herein may be
limited by applicable federal or state securities laws.
(d) The Shares, when issued and paid for in accordance with this
Agreement, will represent validly authorized, duly issued and fully paid
and nonassessable shares of Common Stock of the Company, and the issuance
thereof will not conflict with the Articles of Incorporation or Bylaws of
the Company and will be in compliance in all material respects with all
federal and state securities laws applicable to such issuance and sale.
(e) The execution and delivery of this Agreement, the fulfillment of
the terms set forth herein and the consummation of the transactions
contemplated hereby will not conflict with, or constitute a breach of or
default under, any agreement, indenture or instrument by which the Company
is bound or any law, administrative rule, regulation or decree of any
court or any governmental body or administrative agency applicable to the
Company.
15
(f) As of the date of this Agreement, the Disclosure Documents do
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
(g) The Disclosure Documents that have been filed with the SEC, at
the time they were filed with the SEC, complied in all material respects
with the requirements of the Exchange Act, and, when read together and
with the other information in the Disclosure Documents, do not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(h) Subsequent to the dates as of which information is given in the
Disclosure Documents, except as described therein, or in any SEC filing
made after the date thereof, there has not been any material adverse
change with regard to the assets or properties, results of operations or
financial condition of the Company.
7. Survival; Indemnification. All representations, warranties and
covenants contained in this Agreement and the indemnification contained in this
Section 7 shall survive (i) the acceptance of this Agreement by the Company and
(ii) changes in the transactions, documents and instruments described herein
which are not material or which are to the benefit of the Subscriber. The
Subscriber acknowledges and understands the meaning and legal consequences of
the representations, warranties and covenants in Section 5 hereof and that the
Company and the Placement Agent have relied upon such representations,
warranties and covenants in determining the Subscriber's qualification and
suitability to purchase the Shares. The Subscriber hereby agrees to indemnify,
defend and hold harmless the Company, the Placement Agent and their respective
officers, directors, employees, agents and controlling persons from and against
any and all losses, claims, damages, liabilities, expenses (including attorneys'
fees and disbursements), judgments or amounts paid in settlement of actions
arising out of or resulting from the untruth of any representation of the
Subscriber herein or the breach of any warranty or covenant herein by the
Subscriber. Notwithstanding the foregoing, however, no representation, warranty,
covenant or acknowledgment made herein by the Subscriber shall in any manner be
deemed to constitute a waiver of any rights granted to it under the Securities
Act or state securities laws.
8. Notices. All notices and other communications provided for herein shall
be in writing and shall be deemed to have been duly given if delivered
personally or sent by registered or certified mail, return receipt requested,
postage prepaid, or sent by reputable overnight carrier, charges prepaid or upon
confirmation if delivered by facsimile:
(a) if to the Company, to the following address:
Carrizo Oil & Gas, Inc.
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxx X. Xxxxxx
Chief Financial Officer
Fax: (000) 000-0000
16
(b) if to the Subscriber, to the address set forth on the signature
page hereto or at such other address as any party shall have specified by
notice in writing to the others.
(c) if to the Placement Agents, to the following address:
Hibernia Southcoast Capital, Inc.
000 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxxx, Xx.
Managing Director
Fax: (000) 000-0000
9. Notification of Changes. The Subscriber agrees and covenants to notify
the Company and the Placement Agents immediately upon the occurrence of any
event prior to the consummation of the Offering that would cause any
representation, warranty, covenant or other statement contained in this
Agreement to be false or incorrect or of any change in any statement made herein
occurring prior to the consummation of the Offering.
10. Assignability. This Agreement and the rights granted hereunder are
assignable or transferable by the Subscriber only if (i) such transfer or
assignment may otherwise be effected in accordance with applicable securities
laws, (ii) such assignee or transferee acquires at least 50,000 Shares from the
Subscriber (subject to appropriate adjustment for any stock splits, dividends,
subdivisions, combinations, recapitalizations and the like) and (iii) the
Subscriber notifies the Company in writing of the transfer or assignment,
stating the name and the address of the transferee or assignee and identifying
the securities with respect to which such registration rights are being
transferred or assigned, and the assignee or transferee agrees in writing to be
bound by the provisions of this Agreement. This Agreement and the rights granted
hereunder may not be modified, waived or terminated except by an instrument in
writing signed by the party against whom enforcement of such modification,
waiver or termination is sought.
11. Binding Effect. Except as otherwise provided herein, this Agreement
shall be binding upon and inure to the benefit of the Company, the Placement
Agents, the Subscriber and their heirs, executors, administrators, successors,
legal representatives and permitted assigns, and the agreements,
representations, warranties and acknowledgments contained herein shall be deemed
to be made by and be binding upon such heirs, executors, administrators,
successors, legal representatives and permitted assigns.
12. Obligations Irrevocable. The obligations of the Subscriber shall be
irrevocable, except with the consent of the Company, until the consummation or
termination of the Offering or the rejection of the Subscriber's subscription in
whole by the Company.
13. Entire Agreement; Amendment. This Agreement constitutes the entire
agreement of the Subscriber and the Company relating to the matters contained
herein, superseding all prior contracts or agreements, whether oral or written.
Except as expressly provided herein, neither this Agreement nor any term hereof
may be amended, waived, discharged or terminated other than by a written
instrument signed by the party against whom enforcement of any such amendment,
waiver, discharge or termination is sought; provided, however, that any
provisions hereof included in Section 4 hereof other than (j) through (n) or
otherwise relating to registration
17
rights may be amended, waived, discharged or terminated upon the written consent
of the Company and the holders of a majority in interest of the aggregate of the
then outstanding Offering Shares (or prior to their registration, the Shares)
held by the Subscribers.
14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas, without regard to the principles
of conflicts of law thereof that would require the application of the laws of
any jurisdiction other than the State of Texas.
15. Severability. If any provision of this Agreement or the application
thereof to the Subscriber or any circumstance shall be held invalid or
unenforceable to any extent, the remainder of this Agreement and the application
of such provision to other subscriptions or circumstances shall not be affected
thereby and shall be enforced to the greatest extent permitted by law.
16. Headings. The headings in this Agreement are inserted for convenience
and identification only and are not intended to describe, interpret, define, or
limit the scope, extent or intent of this Agreement or any provision hereof.
17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which together shall be deemed to be one and the same
agreement.
18. Indemnity; Certain Remedies.
(a) THE INDEMNIFICATION RIGHTS PROVIDED FOR IN THIS AGREEMENT SHALL
BE APPLICABLE WITHOUT REGARD TO THE CAUSE THEREOF INCLUDING, BUT NOT
LIMITED, TO THE NEGLIGENCE OR STRICT LIABILITY OF ANY PERSON ENTITLED TO
SUCH INDEMNIFICATION AND WHETHER SUCH NEGLIGENCE BE SOLE, JOINT, OR
CONCURRENT, ACTIVE OR PASSIVE AND SHALL SURVIVE THE EXECUTION AND DELIVERY
OF THIS AGREEMENT AND THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED
HEREBY WITHOUT LIMIT, REGARDLESS OF ANY INVESTIGATION, INQUIRY OR
EXAMINATION.
(b) Subject to the Subscriber's right to specific performance, but
otherwise notwithstanding anything to the contrary in this Agreement, the
payment of cash as provided in Section 4(b) hereof shall be damages (and
is not intended as a penalty) and shall be the Subscriber's sole and
exclusive remedy in the event of the registration default as described in
that Section 4(b); provided, however, that if the foregoing remedy is
deemed unenforceable by a court of competent jurisdiction then the
Subscriber shall have all other remedies available at law or in equity.
19. Counsel. The Subscriber hereby acknowledges that the Company and its
counsel, Xxxxx Xxxxx L.L.P., represent the interests of the Company and not
those of the Subscriber in any agreement (including this Agreement) to which the
Company is a party.
[Signature page to follow]
18
IN WITNESS WHEREOF, the Subscriber has executed this Subscription and
Registration Rights Agreement as of June _______, 2005.
SUBSCRIBER
_____________________________________________
Number of Shares: ___________________________
Offering Price per Share: $__________________
Subscription Amount: $_______________________
By: _________________________________________
Name: ___________________________________
Title: __________________________________
Address: ________________________________
_________________________________________
_________________________________________
Please designate name in which a stock
certificate(s) representing Shares purchased
are to be registered.
_____________________________________________
Please designate address for delivery of a
stock certificate(s) representing Shares
purchased (if different from above).
_____________________________________________
_____________________________________________
_____________________________________________
Please designate the individual to whom all
correspondence concerning the Subscriber's
subscription for Shares should be sent, along
with such individual's requested contact
information.
Name: _______________________________________
Address: ____________________________________
Telephone: (_____) __________________________
Facsimile: (_____) __________________________
E-mail: _____________________________________
The name(s) of the natural person(s) who will have voting and investment power
over the Shares purchased are as follows: ______________________________________
Please indicate the number of shares of the Company's Common Stock currently
owned by the Subscriber in additional to those being subscribed for in this
Agreement. _______________________________
19
The Company hereby accepts the foregoing subscription subject to the terms
and conditions hereof as of June ____________, 2005.
Carrizo Oil & Gas, Inc.
By: _________________________________________
Name:
Title:
20
EXHIBIT A
HOW TO SUBSCRIBE
(1) If you are subscribing for the purchase of Shares, please complete,
date and sign the signature page to this Subscription and Registration Rights
Agreement in the applicable spaces. Please signify the amount of Shares you are
purchasing by inserting such amount in the space provided for on the signature
page to the Agreement.
(2) You must be an institution that is (a) currently a security holder of
the Company and (b) an accredited investor to participate in the Offering.
Complete, date and sign the "Certificate of Accredited Investor Status" attached
to this Agreement as Exhibit B.
(3) Send all signed, completed documents to:
Carrizo Oil & Gas, Inc.
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxx X. Xxxxxx
Chief Financial Officer
Fax: (000) 000-0000
(4) Fax all completed documents to:
Hibernia Southcoast Capital, Inc.
Attn: Xxxxxxx X. Xxxxxxxxx, Xx.
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
(5) Transmit funds (in an amount equal to the number of Shares you are
purchasing multiplied by the Offering Price) via wire transfer to one of the
following accounts:
DOMESTIC
For further credit to:
FOREIGN
For further credit to:
ATTENTION SUBSCRIBERS: NO SUBSCRIPTION WILL BE ACCEPTED UNLESS ALL REQUIRED
DOCUMENTATION IS FULLY COMPLETED AND EXECUTED. THE COMPANY WILL RETURN ANY
MATERIALS RECEIVED THAT ARE INCOMPLETE IN ANY RESPECT.
21
EXHIBIT B
CERTIFICATE OF ACCREDITED INVESTOR STATUS
UNDER RULE 501(a) OF REGULATION D UNDER THE SECURITIES ACT OF 1933
The undersigned represents and warrants that, as of the date of its
purchase of securities of Carrizo Oil & Gas, Inc., a Texas corporation (the
Company"), it is an institution that comes within one of the categories marked
below, and that for any category marked, it has truthfully set forth the factual
basis or reason the undersigned comes within that category. The undersigned
agrees to furnish any additional information the Company deems necessary to
verify the answers set forth below.
[ ] (a) The undersigned is a bank; a savings and loan association; a broker
or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934; an insurance company; a registered investment
company; a registered business development company; a licensed small
business investment company; a plan established by a state or
political subdivision for the benefit of its employees that has
assets in excess of $5,000,000; or an employee benefit plan within
the meaning of Title 1 of ERISA for which the investment decision is
made by a plan fiduciary which is either a bank, savings and loan
association, insurance company or registered investment advisor or
it is an employee benefit plan having total assets in excess of
$5,000,000 or if it is a self directed plan, the investment decision
is made solely by persons that are accredited investors.
____________________________________________________________________
____________________________________________________________________
(describe entity)
[ ] (b) The undersigned is a private business development company as defined
in Section 202(a)(22) of the Investment Advisers Act of 1940.
____________________________________________________________________
____________________________________________________________________
(describe entity)
[ ] (c) The undersigned is a corporation, partnership or non-profit
organization within the meaning of Section 501(c)(3) of the Internal
Revenue Code, in each case not formed for the specific purpose of
acquiring the securities offered by the Company and with total
assets in excess of $5,000,000.
____________________________________________________________________
____________________________________________________________________
(describe entity)
[ ] (d) The undersigned is a trust with total assets in excess of
$5,000,000, not formed for the specific purpose of acquiring the
securities offered by the Company, whose purchase is directed by a
"sophisticated person" as defined in Rule 506(b)(2)(ii) of
Regulation D under the Securities Act of 1933.
____________________________________________________________________
____________________________________________________________________
(describe entity)
22
[ ] (e) The undersigned is an entity in which all of the equity owners are
accredited investors.
____________________________________________________________________
____________________________________________________________________
(describe entity)
THE UNDERSIGNED UNDERSTANDS THE SIGNIFICANCE TO THE COMPANY AND THE PLACEMENT
AGENT OF THE FOREGOING REPRESENTATIONS, AND THE UNDERSIGNED MAKES THESE
REPRESENTATIONS WITH THE INTENTION THAT THE COMPANY AND THE PLACEMENT AGENT WILL
RELY ON THEM.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Accredited Investor Status effective as of __________, 2005.
By: ______________________________
Name:
Title:
Address:
23
EXHIBIT C
PLAN OF DISTRIBUTION
As of the date of this prospectus, we have not been advised by the selling
shareholders as to any plan of distribution. Distributions of the shares by the
selling shareholders, or by their partners, pledgees, donees (including
charitable organizations), transferees or other successors in interest, may from
time to time be offered for sale either directly by such individual, or through
underwriters, dealers or agents or on any exchange on which the shares may from
time to time be traded, in the over-the-counter market, or in independently
negotiated transactions or otherwise. The methods by which the shares may be
sold include:
- a block trade (which may involve crosses) in which the broker or dealer so
engaged will attempt to sell the securities as agent but may position and
resell a portion of the block as principal to facilitate the transaction;
- purchases by a broker or dealer as principal and resale by such broker or
dealer for its own account pursuant to this prospectus;
- exchange distributions and/or secondary distributions;
- sales in the over-the-counter market;
- underwritten transactions;
- ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and
- privately negotiated transactions.
Such transactions may be effected by the selling shareholders at market
prices prevailing at the time of sale or at negotiated prices. The selling
shareholders may effect such transactions by selling the securities to
underwriters or to or through broker-dealers, and such underwriters or
broker-dealers may receive compensations in the form of discounts or commissions
from the selling shareholders and may receive commissions from the purchasers of
the securities for whom they may act as agent. The selling shareholders may
agree to indemnify any underwriter, broker-dealer or agent that participates in
transactions involving sales of the shares against certain liabilities,
including liabilities arising under the Securities Act. We have agreed to
register the shares for sale under the Securities Act and to indemnify the
selling shareholders against certain civil liabilities, including certain
liabilities under the Securities Act.
In connection with sales of the securities under this prospectus, the
selling shareholders may enter into hedging transactions with broker-dealers,
who may in turn engage in short sales of the securities in the course of hedging
the positions they assume. The selling shareholders also may sell securities
short and deliver them to close our the short positions, or loan or pledge the
securities to broker-dealers that in turn may sell them.
The selling shareholders and any underwriters, dealers or agents that
participate in distribution of the securities may be deemed to be underwriters,
and any profit on sale of the securities by them and any discounts, commissions
or concessions received by any underwriter, dealer or agent may be deemed to be
underwriting discounts and commissions under the Securities Act.
There can be no assurances that the selling shareholders will sell any or
all of the securities offered under this prospectus.
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