Gasco Energy, Inc. 12,500,000 Shares of Common Stock Underwriting Agreement
EXHIBIT 1.1
Gasco Energy, Inc.
12,500,000 Shares of Common Stock
November 17, 2005
X.X. Xxxxxx Securities Inc.
As Representative of the
several Underwriters listed
in Schedule 1 hereto
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
As Representative of the
several Underwriters listed
in Schedule 1 hereto
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Gasco Energy, Inc., a Nevada corporation (the “Company”), proposes to issue and sell to the
several Underwriters listed in Schedule 1 hereto (the “Underwriters”), for whom you are acting as
representative (the “Representative”), an aggregate of 12,500,000 shares of its Common Stock, par
value $0.0001 per share, of the Company (the “Underwritten Shares”) and, for the sole purpose of
covering over-allotments in connection with the sale of the Underwritten Shares, up to an
additional 1,875,000 shares of its Common Stock (the “Option Shares”). The Underwritten Shares and
the Option Shares are hereinafter referred to as the “Shares.” The shares of common stock, par
value $0.0001 per share, of the Company to be outstanding after giving effect to the sales
contemplated hereby are hereinafter referred to as the “Stock.”
The Company hereby confirms its agreement with the several Underwriters concerning the
purchase and sale of the Shares, as follows:
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supplement specifically
relating to the Shares together with the Basic Prospectus, and the term “Prospectus” means Basic Prospectus as supplemented by the Prospectus Supplement specifically
relating to the Shares in the form first used to confirm sales of the Shares. If the Company has
filed an abbreviated registration statement pursuant to Rule 462(b) under the Securities Act (the
“Rule 462 Registration Statement”), then any reference herein to the term “Registration Statement”
shall be deemed to include such Rule 462 Registration Statement. Any reference in this Agreement
to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form
S-3 under the Securities Act, as of the effective date of the Registration Statement or the date of
such Preliminary Prospectus or the Prospectus, as the case may be and any reference to “amend”,
“amendment” or “supplement” with respect to the Registration Statement, any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include any documents filed after such date under
the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission
thereunder (collectively, the “Exchange Act”) that are deemed to be incorporated by reference
therein. Capitalized terms used but not defined herein shall have the meanings given to such terms
in the Registration Statement and the Prospectus.
In addition, the Company agrees to issue and sell the Option Shares to the several
Underwriters as provided in this Agreement, and the Underwriters, on the basis of the
representations, warranties and agreements set forth herein and subject to the conditions set forth
herein, shall have the option to purchase, severally and not jointly, from the Company the Option
Shares at the Purchase Price.
If any Option Shares are to be purchased, the number of Option Shares to be purchased by each
Underwriter shall be the number of Option Shares which bears the same ratio to the aggregate number
of Option Shares being purchased as the number of Underwritten Shares set forth opposite the name
of such Underwriter in Schedule 1 hereto (or such number increased as set forth in Section 9
hereof) bears to the aggregate number of Underwritten Shares being purchased from the Company by
the several Underwriters, subject, however, to such adjustments to eliminate any fractional Shares
as the Representative in its sole discretion shall make.
The Underwriters may exercise the option to purchase the Option Shares at any time in whole,
or from time to time in part, on or before the thirtieth day following the date of this Agreement,
by written notice from the Representative to the Company. Such notice shall set forth the
aggregate number of Option Shares as to which the option is being exercised and the date and time
when the Option Shares are to be delivered and paid for which may be the same date and time as the
Closing Date (as hereinafter defined) but shall not be earlier than the Closing
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Date nor later than
the tenth full business day (as hereinafter defined) after the date of such notice (unless such
time and date are postponed in accordance with the provisions of
Section 9 hereof). Any such notice shall be given at least two business days prior to the date and
time of delivery specified therein.
(b) The Company understands that the Underwriters intend to make a public offering of the
Shares as soon after the effectiveness of this Agreement as in the judgment of the Representative
is advisable, and initially to offer the Shares on the terms set forth in the Prospectus. The
Company acknowledges and agrees that the Underwriters may offer and sell Shares to or through any
affiliate of an Underwriter and that any such affiliate may offer and sell Shares purchased by it
to or through any Underwriter.
(c) Payment for the Shares shall be made by wire transfer in immediately available funds to
the account specified by the Company to the Representative in the case of the Underwritten Shares,
at the offices of Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00
A.M. New York City time on November 23, 2005, or at such other time or place on the same or such
other date, not later than the fifth business day thereafter, as the Representative and the Company
may agree upon in writing or, in the case of the Option Shares, on the date and at the time and
place specified by the Representative in the written notice of the Underwriters’ election to
purchase such Option Shares. The time and date of such payment for the Underwritten Shares is
referred to herein as the “Closing Date” and the time and date for such payment for the Option
Shares, if other than the Closing Date, are herein referred to as the “Additional Closing Date”.
Payment for the Shares to be purchased on the Closing Date or the Additional Closing Date, as
the case may be, shall be made against delivery through the facilities of The Depository Trust
Company to the Representative for the respective accounts of the several Underwriters of the Shares
to be purchased on such date in definitive form registered in such names and in such denominations
as the Representative shall request in writing not later than two full business days prior to the
Closing Date or the Additional Closing Date, as the case may be, with any transfer taxes payable in
connection with the sale of the Shares duly paid by the Company. The certificates for the Shares
will be made available for inspection and packaging by the Representative at the office of X.X.
Xxxxxx Securities Inc. set forth above not later than 1:00 P.M., New York City time, on the
business day prior to the Closing Date or the Additional Closing Date, as the case may be.
(d) The Company acknowledges and agrees that the Underwriters are acting solely in the
capacity of an arm’s length contractual counterparty to the Company with respect to the offering of
Shares contemplated hereby (including in connection with determining the terms of the offering) and
not as a financial advisor or a fiduciary to, or an agent of, the Company or any other person.
Additionally, neither the Representative nor any other Underwriter is advising the Company or any
other person as to any legal, tax, investment, accounting or regulatory matters in any
jurisdiction. The Company shall consult with its own advisors concerning such matters and shall be
responsible for making their own independent investigation and appraisal of the transactions
contemplated hereby, and the Underwriters shall have no responsibility or liability to
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the Company
with respect thereto. Any review by the Underwriters of the Company, the transactions contemplated
hereby or other matters relating to such transactions will be performed solely for the benefit of
the Underwriters and shall not be on behalf of the Company.
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applicable, and will not contain any
untrue statement of a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances under which they
were made, not misleading.
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conducts any business, so as to
require such qualification, other than where the failure to be so qualified or in good standing
would not have a Material Adverse Effect.
(j) Underwriting Agreement. This Agreement has been duly authorized, executed and delivered
by the Company.
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(l) Descriptions of the Underwriting Agreement. This Agreement conforms in all material
respects to the description thereof contained in the Registration Statement and the Prospectus.
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party or which affect any of
their respective properties and in which there is a reasonable possibility of an adverse decision,
including ordinary routine litigation incidental to the business of the Company or any Significant
Subsidiary, would not have a Material Adverse Effect; and, to the best of Company’s knowledge, no
such proceedings are threatened or contemplated by governmental authorities or threatened by
others.
9
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Adverse Effect; except for matters that
would not, individually or in the aggregate, have a Material Adverse Effect, the Company has not
incurred and does not expect to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any “pension plan” or (ii) Section 412 or 4971 of the Internal
Revenue Code of 1986, as amended, including the regulations and published interpretations
thereunder (“Code”); and each “pension plan” for which the Company
and each of its subsidiaries would have any liability that is intended to be qualified under
Section 401(a) of the Code is so qualified in all material respects and nothing has occurred,
whether by action or by failure to act, which would reasonably be expected cause the loss of such
qualification; and no “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975
of Code or “accumulated funding deficiency” (as defined in section 302 of ERISA) has occurred.
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(a) Effectiveness of the Registration Statement. The Company will file the final Prospectus
with the Commission within the time periods specified by Rule 424(b) and Rule 430A under the
Securities Act and will file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for so long as
the delivery of a prospectus is required in connection with the offering or sale of the Shares; and
the Company will furnish copies of the Prospectus to the Underwriters in New York City prior to
10:00 A.M., New York City time, on the business day next succeeding the date of this Agreement in
such quantities as the Representative may reasonably request.
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counsel
to the Underwriters) reasonably incurred in connection with such qualification and in connection
with the determination of the eligibility of the Shares for investment under the laws of such
jurisdictions as the Underwriters may designate; provided that the Company shall not be required to
file a general consent to service of process in any jurisdiction or to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified.
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(financial or other) furnished to holders of the Shares, and copies of any reports and financial
statements furnished to or filed with the Commission or any national securities exchange or
automatic quotation system; provided, however, that any document filed by the
Company with the Commission that is publicly available on the Commission’s XXXXX system shall be
deemed furnished to the Representative at the time of such filing.
(a) Registration Compliance; No Stop Order. The Registration Statement (or if a
post-effective amendment thereto is required to be filed under the Securities Act, such
post-effective amendment) shall have become effective, and the Representative shall have received
notice thereof, not later than 5:00 P.M., New York City time, on the date hereof; no order
suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding
for such purpose shall be pending before or threatened by the Commission; the Prospectus shall have
been timely filed with the Commission under the Securities Act and in accordance with Section 4(a)
hereof; and all requests by the Commission for additional information shall have been complied with
to the reasonable satisfaction of the Representative.
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All opinions, letters, certificates and evidence mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form
and substance reasonably satisfactory to counsel for the Underwriters.
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Underwriter (or to the benefit of
any of its affiliates, directors, officers or person controlling such Underwriter) from whom the
person asserting any such losses, claims, damages or liabilities purchased Shares if such untrue
statement or omission or alleged untrue statement or omission made in such Preliminary Prospectus
is eliminated or remedied in the Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) and, if required by law, a copy of the Prospectus
(as so amended or supplemented) shall not have been furnished to such person at or prior to the
written confirmation of the sale of such Shares to such person, unless such failure is the result
of noncompliance by the Company with Section 4(b) hereof.
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reasonably satisfactory to the Indemnified Person; (iii) the
Indemnified Person shall have reasonably concluded that there may be legal defenses available to it
that are different from or in addition to those available to the Indemnifying Person; or (iv) the
named parties in any such proceeding (including any impleaded parties) include both the
Indemnifying Person and the Indemnified Person and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests between them. It is
understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or
related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Indemnified Persons, and that all such
fees and expenses shall be paid or reimbursed as they are incurred. Any such separate firm for any
Underwriter, its affiliates, directors and officers and any control persons of such Underwriter
shall be designated in writing by X.X. Xxxxxx Securities Inc. and any such separate firm for the
Company, its directors, its officers who signed the Registration Statement and any control persons
of the Company shall be designated in writing by the Company. The Indemnifying Person shall not be
liable for any settlement of any proceeding effected without its written consent, but if settled
with such consent or if there be a final judgment for the plaintiff, the Indemnifying Person agrees
to indemnify each Indemnified Person from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time an Indemnified
Person shall have requested that an Indemnifying Person reimburse the
Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the
Indemnifying Person shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after receipt by the
Indemnifying Person of such request and (ii) the Indemnifying Person shall not have reimbursed the
Indemnified Person in accordance with such request prior to the date of such settlement. No
Indemnifying Person shall, without the written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or
could have been a party and indemnification could have been sought hereunder by such Indemnified
Person, unless such settlement (x) includes an unconditional release of such Indemnified Person, in
form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims
that are the subject matter of such proceeding and (y) does not include any statement as to or any
admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.
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Underwriters on the other shall be deemed to be in the same respective proportions as the
net proceeds (before deducting expenses) received by the Company from the sale of the Shares and
the total underwriting discounts and commissions received by the Underwriters in connection
therewith, in each case as set forth in the table on the cover of the Prospectus, bear to the
aggregate offering price of the Shares. The relative fault of the Company on the one hand and the
Underwriters on the other shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or by the Underwriters and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
8. Termination. This Agreement may be terminated in the absolute discretion of the
Representative, by notice to the Company, if after the execution and delivery of this Agreement and
prior to the Closing Date or, in the case of the Option Shares, prior to the Additional Closing
Date, (i) trading generally shall have been suspended or materially limited on or by any of the New
York Stock Exchange, the American Stock Exchange, the National Association of Securities Dealers,
Inc., the Chicago Board Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade; (ii) trading of any securities issued or guaranteed by the
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Company shall have been suspended
on any exchange or in any over-the-counter market; (iii) a general moratorium on commercial banking
activities in New York shall have been declared by federal or New York State authorities; or (iv)
there shall have occurred any outbreak or escalation of hostilities or any change in financial
markets or any calamity or crisis, either within or outside the United States, that, in the
judgment of the Representative, is material and adverse and makes it impracticable or inadvisable
to proceed with the offering, sale or delivery of the Shares on the Closing Date or the Additional
Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement and
the Prospectus.
(b) If, after giving effect to any arrangements for the purchase of the Shares of a defaulting
Underwriter or Underwriters by the non-defaulting Underwriters and the Company as provided in
paragraph (a) above, the aggregate number of Shares that remain unpurchased on the Closing Date or
the Additional Closing Date, as the case may be, does not exceed one-eleventh of the aggregate
number of Shares to be purchased on such date, then the Company shall have the right to require
each non-defaulting Underwriter to purchase the number of Shares that such Underwriter agreed to
purchase hereunder on such date plus such Underwriter’s pro rata share (based on the number of
Shares that such Underwriter agreed to purchase on such date) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase of the Shares of a defaulting
Underwriter or Underwriters by the non-defaulting Underwriters and the Company as provided in
paragraph (a) above, the aggregate number of Shares that remain unpurchased on the Closing Date or
the Additional Closing Date, as the case may be, exceeds one-eleventh of the aggregate amount of
Shares to be purchased on such date, or if the Company shall not exercise the right described in
paragraph (b) above, then this Agreement or, with respect to any Additional
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Closing Date, the
obligation of the Underwriters to purchase Shares on the Additional Closing Date, as the case may
be, shall terminate without liability on the part of the non-defaulting Underwriters. Any
termination of this Agreement pursuant to this Section 9 shall be without liability on the part of
the Company, except that the Company will continue to be liable for the payment of expenses as set
forth in Section 10 hereof and except that the provisions of Section 6 hereof shall not terminate
and shall remain in effect.
(d) Nothing contained herein shall relieve a defaulting Underwriter of any liability it may
have to the Company or any non-defaulting Underwriter for damages caused by its default.
(b) If (i) this Agreement is terminated pursuant to Section 8, (ii) the Company for any reason
fails to tender the Shares for delivery to the Underwriters or (iii) the Underwriters decline to
purchase the Shares for any reason permitted under this Agreement, the Company agrees to reimburse
the Underwriters for all out-of-pocket costs and expenses (including the fees and expenses of their
counsel) reasonably incurred by the Underwriters in connection with this Agreement and the offering
contemplated hereby.
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13. Certain Defined Terms. For purposes of this Agreement, (a) except where otherwise
expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities
Act; (b) the term “business day” means any day other than a day on which banks are permitted or
required to be closed in New York City; and (c) the term “subsidiary” has the meaning set forth in
Rule 405 under the Securities Act.
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If the foregoing is in accordance with your understanding, please indicate your acceptance of
this Agreement by signing in the space provided below.
| Very truly yours, | ||||||
| GASCO ENERGY, INC. | ||||||
| By | /s/ X. Xxxx Xxxxx | |||||
| Name: | X. Xxxx Grant | |||||
| Title: | Executive Vice President
and Chief Financial Officer |
|||||
| Accepted: November 17, 2005 | ||||
| X.X. XXXXXX SECURITIES INC. | ||||
| For itself and on behalf of the several Underwriters listed in Schedule 1 hereto. |
||||
By
|
/s/ Xxxxx X. Xxxxxxxx | |||
Name:
|
Xxxxx X. Xxxxxxxx | |||
Title:
|
Vice President | |||
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Schedule 1
| Number of | ||||
| Underwriter | Underwritten Shares | |||
X.X. Xxxxxx Securities Inc. |
6,875,000 | |||
First Albany Capital Inc. |
2,375,000 | |||
Xxxxxxxxx & Company, Inc. |
1,625,000 | |||
Xxxxxx Xxxxxxx & Co., Inc. |
1,625,000 | |||
Total |
12,500,000 | |||
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Annex A
FORM OF OPINION OF XXXXXX & XXXXXX L.L.P.
(1) The Registration Statement was declared effective under the Securities Act as of the date
specified in such opinion; the Prospectus was filed with the Commission pursuant to the
subparagraph of Rule 424(b) under the Securities Act specified in such opinion on the date
specified therein; and no order suspending the effectiveness of the Registration Statement has been
issued and no proceeding for that purpose is pending or, to the best knowledge of such counsel,
threatened by the Commission.
(2) The Registration Statement and the Prospectus (other than the financial statements and
schedules and other financial, accounting and statistical data and the oil and gas reserve data, in
each case contained or incorporated by reference (including the notes thereto and auditor’s report
thereon) therein, as to which such counsel need express no opinion) appeared on their face to
comply as to form in all material respects with the requirements of the Securities Act as of the
effective date thereof, as of the effective date of any amendment thereto, and as of the date of
the Underwriting Agreement.
(3) The authorized capital stock of the Company conforms as to legal matters to the
description thereof contained in the Prospectus.
(4) No consent, approval, authorization or qualification of or with any federal or state
court, governmental agency or body is required for the issue and sale of the Shares or the
consummation by the Company of the transactions contemplated by the Underwriting Agreement (other
than federal securities laws, as to which such counsel expresses no opinion in this paragraph, and
state securities or blue sky laws, as to which such counsel expresses no opinion).
(5) The Company is not and, after giving effect to the offering and sale of the Shares and the
application of the proceeds thereof as described in the Prospectus, will not be required to
register as an “investment company” as defined in the Investment Company Act of 1940, as amended.
(6) The statements in the Registration Statement and the Prospectus under the caption
“Description of Capital Stock,” the statements incorporated by reference in the Registration
Statement and the Prospectus from Item 3 of Part I of the Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2004, as modified by the statements incorporated by reference in
the Registration Statement and the Prospectus from Item 1 of Part II of the Company’s Quarterly
Reports on Form 10-Q filed since such Annual Report and incorporated by reference in the
Registration Statement and the Prospectus from Item 8.01 of the Company’s Current Reports on Form
8-K, if any, filed since such Annual Report, insofar as such statements constitute summaries of the
legal matters, documents or proceedings referred to therein, fairly present the information called
for with respect to such legal matters, documents or proceedings.
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(7) Each document incorporated by reference in the Prospectus (other than the financial
statements and schedules and other financial, accounting and statistical data and the oil and gas
reserve data, in each case contained or incorporated by reference (including the notes thereto and
auditor’s report thereon) therein, as to which such counsel need express no opinion) appeared on
its face to comply as to form when it was filed with the Commission in all material respects with
the Securities Act or the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder;
In addition, Xxxxxx & Xxxxxx L.L.P. shall state that because the primary purpose of their
engagement was not to establish or confirm factual matters or oil and gas reserve or financial or
statistical data and because of the wholly or partially non-legal character of many of the
statements contained or incorporated by reference in the Registration Statement and the Prospectus,
they are not passing upon and do not assume any responsibility for the accuracy, completeness or
fairness of the statements contained or incorporated by reference in the Registration Statement and
the Prospectus (except to the extent stated in paragraphs (1) and (6)), and that they (i) have not
independently verified the accuracy, completeness or fairness of such statements and (ii) assume no
responsibility for and have not independently verified the accuracy, completeness or fairness of
the oil and gas reserve or financial statements and schedules and other financial, accounting and
statistical data included or incorporated by reference in the Registration Statement and the
Prospectus and (iii) have not examined the production, financial, accounting or other records from
which such oil and gas reserves or financial statements and other oil and gas reserve and financial
and statistical data are derived. However, Xxxxxx & Xxxxxx LLP shall state that they have
participated in conferences with officers and other representatives of the Company, representatives
of the independent registered public accountants of the Company, representatives of the
Underwriters and counsel for the Underwriters, at which conferences, the contents of the
Registration Statement and the Prospectus and any amendment and supplement thereto and related
matters were discussed. Such counsel shall further state that, based on the participation
described above in the course of acting as counsel to the Company, no information has come to their
attention that has caused such counsel to believe that, on the date of the Underwriting Agreement,
the Registration Statement (including the information, if any, deemed pursuant to Rule 430A to be
part of the Registration Statement at the time of effectiveness), as supplemented by the
Prospectus, contained any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not misleading, or that
the Prospectus or any amendment or supplement thereto as of its date and the Closing Date contained
or contains any untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading (other than the financial statements and schedules and other
financial, accounting and statistical data and the oil and gas reserve data, in each case contained
or incorporated by reference (including the notes thereto and auditor’s report thereon) therein, as
to which such counsel need not express any belief).
In rendering such opinions, such counsel may rely (A) as to matters involving the application
of laws other than the laws of the United States and the States of Texas and New York, to the
extent such counsel deems proper and to the extent specified in such opinion, if at
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all, upon an
opinion or opinions (reasonably satisfactory to Underwriters’ counsel) of other
counsel reasonably acceptable to the Underwriters’ counsel, familiar with the applicable laws; and
(B) as to matters of fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and certificates or other written statements of officials of jurisdictions
having custody of documents respecting the corporate existence or good standing of the Company.
The opinion of such counsel for the Company shall state that the opinion of any such other counsel
is in form satisfactory to such counsel and, in such counsel’s opinion, the Underwriters and they
are justified in relying thereon.
The opinion of Xxxxxx & Xxxxxx L.L.P. described above shall be rendered to the Underwriters at
the request of the Company and shall so that therein.
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Annex B
FORM OF OPINION OF
XXXX, DILL, CARR, XXXXXXXXXX & XXXXXXXXX P.C.
XXXX, DILL, CARR, XXXXXXXXXX & XXXXXXXXX P.C.
(1) The Company has been duly incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described in the Registration
Statement and the Prospectus.
(2) The Company has all requisite corporate power and authority to execute and deliver the
Underwriting Agreement and to perform its obligations thereunder. The execution, delivery and
performance of the Underwriting Agreement by the Company has been duly authorized by all necessary
corporate action on the part of the Company. The Underwriting Agreement has been duly and validly
executed and delivered by the Company.
(3) The authorized capital stock of the Company conforms as to legal matters to the
description thereof contained in the Prospectus.
(4) The shares of Stock outstanding on the Closing Date have been duly authorized and are
validly issued, fully paid and non-assessable.
(5) The Shares to be sold by the Company under the Underwriting Agreement have been duly
authorized by the Company, and when issued and delivered and paid for as provided therein, will be
validly issued, fully paid and non-assessable and will conform to the description thereof contained
in the Prospectus, and the issuance of the Shares will not be subject to any preemptive or similar
rights under the Company’s Articles of Incorporation or Bylaws or under the laws of the State of
Nevada.
(6) The Company has been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other jurisdiction in which it owns or
leases properties, or conducts any business, so as to require such qualification, other than where
the failure to be so qualified or in good standing would not have a Material Adverse Effect.
(7) Each of the Company’s Significant Subsidiaries has been duly incorporated and is validly
existing as a corporation under the laws of its jurisdiction of incorporation with power and
authority (corporate and other) to own its properties and conduct its business as described in the
Registration Statement and the Prospectus and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of each other jurisdiction in
which it owns or leases properties, or conducts any business, so as to require such qualification,
other than where the failure to be so qualified and in good standing would not have a Material
Adverse Effect; and all of the outstanding shares of capital stock of each Significant Subsidiary
have been duly and validly authorized and issued, are fully paid and non assessable, and are owned
directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or
claims.
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(8) To such counsel’s knowledge, after due inquiry, other than as set forth, incorporated by
reference or contemplated in the Registration Statement and the Prospectus, there are no legal or
governmental proceedings pending or threatened to which the Company or any of its subsidiaries is
or may be a party or to which any property of the Company or its subsidiaries is or may be the
subject which, if determined adversely to the Company or such subsidiaries, could individually or
in the aggregate reasonably be expected to have a Material Adverse Effect. To such counsel’s
knowledge, no such proceedings are threatened or contemplated by governmental authorities or
threatened by others.
(9) Neither the Company nor any of its Significant Subsidiaries is, or with the giving of
notice or lapse of time or both would be, in violation of or in default under, its Articles of
Incorporation or Bylaws or any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which the Company or any of its Significant
Subsidiaries is a party or by which it or any of them or any of their respective properties is
bound, except for violations and defaults which individually and in the aggregate would not have a
Material Adverse Effect. The issue and sale of the Shares and the execution, delivery and
performance by the Company of the Underwriting Agreement and the consummation of the transactions
therein contemplated will not conflict with or result in a breach of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other
material agreement or instrument known to such counsel to which the Company or any of its
Significant Subsidiaries is a party or by which the Company or any of its Significant Subsidiaries
is bound or to which any of the property or assets of the Company or any of its Significant
Subsidiaries is subject, nor will any such action result in any violation of the provisions of the
Articles of Incorporation, or the Bylaws of the Company or any applicable law or statute or any
order, rule or regulation of any court or governmental agency or body having jurisdiction over the
Company, its Significant Subsidiaries or any of their respective properties.
In rendering such opinions, such counsel may rely (A) as to matters involving the application
of laws other than the laws of the United States and the States of Colorado and Nevada, to the
extent such counsel deems proper and to the extent specified in such opinion, if at all, upon an
opinion or opinions (reasonably satisfactory to Underwriters’ counsel) of other counsel reasonably
acceptable to the Underwriters’ counsel, familiar with the applicable laws; and (B) as to matters
of fact, to the extent such counsel deems proper, on certificates of responsible officers of the
Company and certificates or other written statements of officials of jurisdictions having custody
of documents respecting the corporate existence or good standing of the Company. The opinion of
such counsel for the Company shall state that the opinion of any such other counsel is in form
satisfactory to such counsel and, in such counsel’s opinion, the Underwriters and they are
justified in relying thereon.
The opinion of Xxxx, Dill, Carr, Xxxxxxxxxx & Xxxxxxxxx P.C. described above shall be rendered
to the Underwriters at the request of the Company and shall so that therein.
30
Exhibit A
FORM OF LOCK-UP AGREEMENT
November 17, 2005
X.X. XXXXXX SECURITIES INC.
As Representative of
the several Underwriters listed in
Schedule 1 to the Underwriting
Agreement referred to below
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
As Representative of
the several Underwriters listed in
Schedule 1 to the Underwriting
Agreement referred to below
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Gasco Energy, Inc. — Public Offering
Ladies and Gentlemen:
The undersigned understands that you, as Representative of the several Underwriters, propose
to enter into an Underwriting Agreement (the “Underwriting Agreement”) with Gasco Energy, Inc., a
Nevada corporation (the “Company”), providing for the public offering (the “Public Offering”) by
the several Underwriters named in Schedule 1 to the Underwriting Agreement (the “Underwriters”), of
common stock, par value $0.0001 per share, of the Company (the “Securities”). Capitalized terms
used herein and not otherwise defined shall have the meanings set forth in the Underwriting
Agreement.
In consideration of the Underwriters’ agreement to purchase and make the Public Offering of
the Securities, and for other good and valuable consideration receipt of which is hereby
acknowledged, the undersigned hereby agrees that, without the prior written consent of X.X. Xxxxxx
Securities Inc. on behalf of the Underwriters, the undersigned will not, during the period
commencing on the date hereof and ending 90 days after the date of the prospectus supplement
relating to the Public Offering (the “Prospectus”), (1) offer, pledge, announce the intention to
sell, sell, contract to sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose
of, directly or indirectly, any shares of Common Stock, par value $0.0001 per share par value, of
the Company (the “Common Stock”) or any securities convertible into or exercisable or exchangeable
for Common Stock (including, without limitation, Common Stock which may be deemed to be
beneficially owned by the undersigned in accordance with the rules and regulations of the
Securities and Exchange Commission and securities which may be issued upon exercise of a stock
option or warrant) or (2) enter into any swap or other agreement that transfers, in whole
31
or in
part, any of the economic consequences of ownership of the Common Stock, whether any
such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock
or such other securities, in cash or otherwise. In addition, the undersigned agrees that, without
the prior written consent of X.X. Xxxxxx Securities Inc. on behalf of the Underwriters, it will
not, during the period commencing on the date hereof and ending 90 days after the date of the
Prospectus, make any demand for or exercise any right with respect to, the registration of any
shares of Common Stock or any security convertible into or exercisable or exchangeable for Common
Stock. The foregoing restrictions shall not apply to (a) transfers of Common Stock by gift, will
or intestacy, including without limitation transfers by gift, will or intestacy to family members
of the undersigned or to a settlement or trust established under the laws of any country or (b)
sale of Stock acquired upon exercise of options outstanding under the Company’s stock option
agreements and stock option plan, in each case existing on the date of the Prospectus [or (c) a
pledge of shares of Common Stock by the undersigned under an agreement existing prior to the date
of this Lock-Up Agreement] provided that in the event of any transfer pursuant to clause (a), the
transferee shall enter into a lock-up agreement substantially in the form of this Lock-Up Agreement
covering the remainder of the 90-day period referred to herein.
In furtherance of the foregoing, the Company, and any duly appointed transfer agent for the
registration or transfer of the securities described herein, are hereby authorized to decline to
make any transfer of securities if such transfer would constitute a violation or breach of this
Letter Agreement.
The undersigned hereby represents and warrants that the undersigned has full power and
authority to enter into this Letter Agreement. All authority herein conferred or agreed to be
conferred and any obligations of the undersigned shall be binding upon the successors, assigns,
heirs or personal representatives of the undersigned.
The undersigned understands that, if the Underwriting Agreement does not become effective
within 10 days following the date hereof, or if the Underwriting Agreement (other than the
provisions thereof which survive termination) shall terminate or be terminated prior to payment for
and delivery of the Common Stock to be sold thereunder, the undersigned shall be released form all
obligations under this Letter Agreement.
The undersigned understands that the Underwriters are entering into the Underwriting Agreement
and proceeding with the Public Offering in reliance upon this Letter Agreement.
This Letter Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without regard to the conflict of laws principles thereof.
| Very truly yours, | ||||
| (Name) | ||||
| (Address) |
32
Exhibit A-1
PERSONS SUBJECT TO LOCK-UP
Xxxx Xxxxxx
Xxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxxx
X. Xxxx Xxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxx
Xxxx Xxxxxxxxxxx
Xxxx X. Xxxxxx
Xxxxxxx X. Xxxxxxx
Xxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxxx
X. Xxxx Xxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxx
Xxxx Xxxxxxxxxxx
Xxxx X. Xxxxxx
Xxxxxxx X. Xxxxxxx