UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14A
Proxy
Statement Pursuant to Section 14(a) of the Securities
Exchange
Act of 1934
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by the Registrant ☒
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Preliminary
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for Use of the Commission Only (as permitted by Rule
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Definitive
Proxy Statement |
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Definitive
Additional Materials |
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Soliciting
Material Pursuant to §240.14a-12 |
GulfSlope
Energy, Inc.
(Name
of Registrant as Specified In Its Charter)
Payment
of Filing Fee (Check the appropriate box):
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No
fee required. |
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Fee
paid previously with preliminary materials |
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Fee
computed on table in exhibit required by Item 25(b) per Exchange
Act Rules 14a-6(i)(1) and 0-11 |
|
|
GULFSLOPE
ENERGY, INC.
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
TO
BE HELD ON SEPTEMBER 30, 2022
We
hereby give notice that the Annual Meeting of Stockholders of
GulfSlope Energy, Inc. (“we,” “us” and the “Company”) will be held
on September 30, 2022, at 10:00 a.m. Central Time, at 1000 Main
Street, Suite 2300, Houston, Texas 77002, for the following
purposes:
|
(1) |
To
elect three directors; |
|
(2) |
To
ratify the selection of Pannell Kerr Forster of Texas, P.C. as our
independent registered public accounting firm for the fiscal year
ending September 30, 2022; |
|
(3) |
To
approve an amendment to our certificate of incorporation to
increase the number of authorized shares of common stock of the
Company from 1,500,000,000 to 3,000,000,000; |
|
(4) |
To
approve an amendment to our certificate of incorporation to effect
one or a series of reverse splits of our common stock at a ratio of
not less than 1-for-2 and not greater than 1-for-200, with the
exact ratio to be set within such range in the discretion of our
board of directors, without further approval or authorization of
stockholders; |
|
(5) |
To
approve an amendment to our certificate of incorporation that
eliminates reference to the classification of the board of
directors into classes with staggered terms; |
|
(6) |
To
approve a non-binding advisory resolution on executive
compensation; |
|
(7) |
To
vote on whether advisory votes on executive compensation should
occur every one, two or three years; and |
|
(8) |
To
transact such other business as may properly come before the
meeting. |
Under
Delaware law, only stockholders of record on the record date, which
is August 12, 2022, are entitled to notice of and to vote at the
Annual Meeting or any adjournment. It is important that your shares
of common stock be represented at this meeting so that the presence
of a quorum is assured.
Due
to the public health impact of the novel coronavirus disease
(“COVID-19”) outbreak, any person in attendance who exhibits cold
or flu-like symptoms or who has been exposed to COVID-19 may be
asked to leave the premises for the protection of the other
attendees. We reserve the right to take any additional
precautionary measures deemed appropriate in relation to the
meeting and access to the meeting premises. As a result of the
public health and travel risks and concerns due to COVID-19, we may
announce alternative arrangements for the meeting, which may
include switching to a virtual meeting format, or changing the
time, date or location of the Annual Meeting. If we take this step,
we will announce any changes in advance in a press release
available on our website (gulfslope.com) and filed with the
Securities and Exchange Commission as additional proxy materials,
and as otherwise required by applicable state law.
Your
vote is important. Even if you plan to attend the meeting in
person, please date and execute the enclosed proxy and return it
promptly in the enclosed postage-paid envelope as soon as possible.
If you attend the meeting, you may revoke your proxy and vote your
shares in person.
|
By
Order of the Board of Directors, |
|
|
August
[•], 2022 |
John
N. Seitz |
|
Chief
Executive Officer and Chairman of the Board |
|
Important
Notice Regarding the Availability of Proxy Materials for the Annual
Meeting of Stockholders to be held September 30,
2022. |
|
The
proxy statement, form of proxy card and annual report are available
at:
www.gulfslope.com
|
|
GULFSLOPE
ENERGY, INC.
1000
Main Street, Suite 2300
Houston,
Texas 77002
PROXY
STATEMENT
INFORMATION
CONCERNING THE ANNUAL MEETING
Mailing
and Solicitation. Proxies are being solicited on behalf of the
Board of Directors of GulfSlope Energy, Inc. This proxy statement
and accompanying form of proxy card will be sent on or about August
[•], 2022 to stockholders entitled to vote at the Annual Meeting.
The cost of the solicitation of proxies will be paid by us. The
solicitation is to be made primarily by mail but may be
supplemented by telephone calls and personal solicitation by our
officers and other employees.
Annual
Report on Form 10-K. A copy of our annual report on Form 10-K
for the year ended September 30, 2021, as filed with the Securities
and Exchange Commission, has been mailed with this proxy statement
to all stockholders entitled to vote at the Annual
Meeting.
Proxies.
Whether or not you plan to attend the Annual Meeting, we request
that you date and execute the enclosed proxy card and return it in
the postage-paid return envelope. If your shares are held in
“street name” through a brokerage, bank or other institution,
telephone and internet instructions are also provided on the proxy
card you receive. The availability of telephone and internet proxy
will depend on the nominee’s proxy processes. A control number,
located on the proxy card, is designed to verify your identity,
allow you to vote your shares, and confirm that your voting
instructions have been properly recorded.
Under
the rules of the New York Stock Exchange (“NYSE”), brokers who hold
shares in “street name” for customers are precluded from exercising
voting discretion with respect to the approval of non-routine
matters (so called “broker non-votes”) where the beneficial owner
has not given voting instructions. Because most large brokerage
firms are NYSE member organizations, these rules affect almost all
public companies and not just those listed on the NYSE. A broker is
not entitled to vote the shares unless the beneficial owner has
given instructions with respect to the election of directors
(Proposal 1). Additionally, a broker is not entitled to vote
uninstructed shares on matters relating to executive compensation,
including the vote to approve a non-binding resolution on executive
compensation (Proposal 6) and the vote on how often the advisory
votes on executive compensation should occur (Proposal 7). With
respect to the ratification of the selection of Pannell Kerr
Forster of Texas, P.C. as our independent registered public
accounting firm (Proposal 2), the amendment to our certificate of
incorporation to increase our authorized common stock (Proposal 3),
the authorization of our board of directors to effect a reverse
stock split of all our outstanding common stock at its discretion
(Proposal 4), and the amendment to our certificate of incorporation
that eliminates reference to the classification of the board of
directors into classes with staggered terms (Proposal 5), a broker
will have discretionary authority to vote the shares of common
stock if the beneficial owner has not given
instructions.
Revocation
of Proxies. The proxy may be revoked by the stockholder at any
time before a vote is taken by notifying our President in writing
at the address of GulfSlope Energy, Inc. given above; by executing
a new proxy bearing a later date or by submitting a new proxy by
telephone or internet; or by attending the Annual Meeting and
voting in person.
Voting
in Accordance with Instructions. The shares represented by your
properly completed proxy will be voted in accordance with your
instructions marked on it. If you properly sign, date, and deliver
to us your proxy but you mark no instructions on it, the shares
represented by your proxy will be voted for the election of the
director nominees as proposed (Proposal 1), for the ratification of
Pannell Kerr Forster of Texas, P.C. as our independent registered
public accounting firm for the year ending September 30, 2022
(Proposal 2), for the amendment to our certificate of incorporation
to increase our authorize common stock (Proposal 3), for the
authorization of our board of directors to effect a reverse stock
split of all our outstanding common stock at its discretion
(Proposal 4), for the amendment to our certificate of incorporation
that eliminates reference to the classification of the board of
directors into classes with staggered terms (Proposal 5), for the
vote to approve a non-binding resolution on executive compensation
(Proposal 6) and for holding advisory votes on executive
compensation every three years (Proposal 7). The board of directors
is not aware of any other matters to be presented for action at the
Annual Meeting, but if other matters are properly brought before
the Annual Meeting, shares represented by properly completed
proxies received by mail will be voted in accordance with the
judgment of the persons named as proxies.
Quorum.
The presence in person or by proxy of a majority of the shares of
common stock outstanding on the record date constitutes a quorum
for purposes of voting on a particular matter and conducting
business at the meeting.
Required
Vote. A plurality of the common stock present in person or
represented by proxy at the Annual Meeting will elect as directors
the nominees proposed (Proposal 1). The ratification of Pannell
Kerr Forster of Texas, P.C. as our independent registered public
accounting firm for the current fiscal year (Proposal 2) and the
vote to approve a non-binding resolution on executive compensation
(Proposal 6) requires the affirmative vote of a majority of the
votes cast by the common stock present in person or represented by
proxy. A plurality of the votes present in person or by proxy will
determine the stockholders selection on the frequency of advisory
resolutions on executive compensation (Proposal 7). The amendment
to our certificate of incorporation to increase our authorize
common stock (Proposal 3), the authorization of our board of
directors to effect a reverse stock split of all our outstanding
common stock at its discretion (Proposal 4) and the amendment to
our certificate of incorporation that eliminates reference to the
classification of the board of directors into classes with
staggered terms (Proposal 5), requires the affirmative vote of a
majority of our outstanding common stock entitled to vote.
Abstentions and broker non-votes will be counted for purposes of
determining the presence or absence of a quorum. Abstentions and
broker non-votes will not be counted as having voted either for or
against a proposal.
Record
Date. The close of business on August 12, 2022 has been fixed
as the record date of the Annual Meeting, and only stockholders of
record at that time will be entitled to vote. As of August 12,
2022, there were 1,268,240,346 shares of common stock issued and
outstanding and entitled to vote at the Annual Meeting. Each
stockholder is entitled to one vote for each share of common stock
held.
No
Dissenters’ Rights. Under the Delaware General Corporation Law,
stockholders are not entitled to dissenters’ rights with respect to
the matters to be voted on at the Annual Meeting.
PROPOSAL
1 - ELECTION OF DIRECTORS
General
Information
Under
our bylaws, the board of directors consists of at least one
director and may consist of such number of directors as may be
fixed from time to time by action of the board of directors.
Directors are elected to hold office until the next annual meeting
of stockholders and until their successors are elected and
qualified or until their earlier resignation or removal. At our
annual meeting of stockholders held in 2014, stockholders approved
adoption of an amendment to our certificate of incorporation to
classify the board of directors into three classes with staggered
terms, the implementation of which was to commence with the 2015
annual meeting of stockholders. We did not hold a subsequent annual
meeting of stockholders until 2018, however, and the staggered
board classifications were never implemented. For this and other
reasons, the board has determined it to be in the best interest of
stockholders to amend our certificate of incorporation to eliminate
reference to the classification of the board of directors into
classes with staggered terms (see Proposal 5).
Presently,
the board of directors consists of three members. Our Governance
and Nominating Committee recommended to the board of directors the
nomination of three nominees, and our board of directors approved
and recommends to stockholders the election of these three nominees
to serve on the board. These nominees are John N. Seitz, Paul L.
Morris and Richard S. Langdon. All three of the nominees presently
serve as members of our board of directors. There are no family
relationships among any of our directors, director nominees or
executive officers.
The
persons named in the enclosed Proxy (“Proxy”) have each been
selected by the board of directors to serve as proxy and will vote
the shares represented by valid proxies at the Annual Meeting and
adjournments thereof. Unless otherwise instructed or unless
authority to vote is withheld, the enclosed Proxy will be voted for
the election of the nominees listed below. Each duly elected
director will hold office until his successor shall have been
elected and qualified. Although our board of directors does not
contemplate that any of the nominees will be unable to serve, if
such a situation arises prior to the Annual Meeting, the person
named in the enclosed Proxy will vote for the election of such
other person(s) as may be nominated by the board of
directors.
Information
Regarding Nominees
The
names of the nominees for election to the board, their principal
occupations and certain other information follow:
John N. Seitz – age 70 – Mr. Seitz has served as the
Company’s chief executive officer and chairman of the board and
director since May 31, 2013, and served as a consultant to the
Company from March 2013 through May 2013. Prior to joining the
Company, Mr. Seitz held positions of increasing responsibility at
Anadarko Petroleum Corporation (NYSE: APC), serving most recently
as a director and as president and chief executive officer until
2003. Mr. Seitz serves on the board of directors of ION Geophysical
Corporation (NYSE: IO). Mr. Seitz is a Certified Professional
Geological Scientist from the American Institute of Professional
Geologists and a licensed professional geoscientist with the State
of Texas. Mr. Seitz has also served as a trustee for the American
Geological Institute Foundation. In 2000, the Houston Geological
Society honored Mr. Seitz as a “Legend in Wildcatting,” and he is a
member of the All American Wildcatters. Mr. Seitz holds a Bachelor
of Science degree in Geology from the University of Pittsburgh, a
Master of Science degree in Geology from Rensselaer Polytechnic
Institute, and has completed the Advanced Management Program at the
Wharton School.
Richard S. Langdon. – age 72 – Richard S. Langdon has
served as a director of the Company since March 2014. Mr. Langdon
is currently the chief executive officer, president and chief
financial officer of Altamont Energy, Inc., a privately held
exploration and production company formed in April 2018. Mr.
Langdon served as the president, chief executive officer and
outside director of Badlands Energy, Inc. and its predecessor
entity, Gasco Energy, Inc. from May 2013 and Debtor-in Possession
since August 2017 to October 2018 (the company filed for Chapter XI
bankruptcy on August 11, 2017). Prior to assuming the President and
CEO role, Mr. Langdon had served as a Gasco Energy Inc. outside
board member from 2003 to October 2018. Mr. Langdon serves as a
member of the board of managers of Evolve Transition Infrastructure
GP, LLC, and is a member of its Audit, Nominating and Corporate
Governance and Conflicts Committees. Mr. Langdon was the president
and chief executive officer of KMD Operating Company, LLC (“KMD
Operating”), and its predecessor entity, Matris Exploration Company
LP (“Matris Exploration”), both privately held exploration and
production companies, from July 2004 through December 2015. Mr.
Langdon was executive vice president and chief operating officer of
KMD Operating, from August 2009, until the merger of Matris
Exploration into KMD Operating in November 2011. From 1997 until
2002, Mr. Langdon served as executive vice president and chief
financial officer of EEX Corporation, a publicly traded exploration
and production company that merged with Newfield Exploration
Company in 2002. Prior to that, he held various positions with the
Pennzoil Companies from 1991 to 1996, including executive vice
president - International Marketing - Pennzoil Products Company;
senior vice president - Business Development - Pennzoil Company and
senior vice president - Commercial & Control - Pennzoil
Exploration & Production Company. Mr. Langdon graduated from
the University of Texas at Austin with a Bachelor of Science degree
in Mechanical Engineering in 1972 and a Masters of Business
Administration in 1974.
Paul L. Morris. – age 80 – Mr. Morris has served as a
director of the Company since March 2014. Mr. Morris founded Elk
River Resources, LLC in August 2013 to explore and develop oil and
gas potential in the oil-producing regions of the southwest United
States. Mr. Morris served as chairman and chief executive officer
of Elk River Resources since inception to November 2020. Prior to
Elk River Resources, Mr. Morris served as president and chief
executive officer from 1988 to September 2013 of Wagner &
Brown, Ltd., an independent oil and gas company headquartered in
Midland, Texas. With Wagner & Brown, Mr. Morris oversaw all
company operations, including exploration and production
activities, in eight states as well as in France, England and
Australia. Mr. Morris also oversaw affiliates involved in natural
gas gathering and marketing, crude oil purchasing and reselling,
pipeline development, construction and operation, and compressed
natural gas (CNG) design, fabrication and operations. Mr. Morris
served as president of Banner Energy from 1981 until 1988. Mr.
Morris graduated from the University of Cincinnati with a Bachelor
of Science degree in Mechanical Engineering in 1964. Mr. Morris has
also completed the Executive Management Program in the College of
Business Administration of Penn State University.
OUR
BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE
ELECTION
OF
THE NOMINEES LISTED ABOVE.
Information
Regarding Executive Officers
Executive
officers are appointed to serve at the discretion of the board. Our
current executive officers are as follows:
Name |
|
Age |
|
Title |
John
N. Seitz |
|
70 |
|
Chairman,
Chief Executive Officer |
John
H. Malanga |
|
54 |
|
Chief
Financial Officer |
John H. Malanga. Mr. Malanga has served as chief financial
officer since July 2014 and is responsible for leading the
financial function of the organization, overseeing strategic
planning and analysis, accounting and reporting, treasury, tax,
audit and risk management. From 2005 to 2014, Mr. Malanga worked as
a senior investment banker with the energy firms of Weisser,
Johnson & Co. and Sanders Morris Harris Inc. Mr. Malanga began
his investment banking career with Jefferies & Co. Over his
career, he has participated in capital markets, mergers and
acquisitions, and financial advisory transactions with particular
emphasis on providing strategic and financial advice to emerging
growth companies. Mr. Malanga holds a Bachelor of Science in
Economics from Texas A&M University and a Master in Business
Administration with a concentration in finance from Rice
University.
See
“Information Regarding Nominees” above for biographical information
of Mr. Seitz.
CORPORATE
GOVERNANCE MATTERS
Meetings
of the Board
All
directors are expected to make every effort to attend meetings of
the board, meetings of any board committees on which such director
serves, and annual meetings of stockholders. The board of directors
held five meetings during the fiscal year ended September 30, 2021.
The board of directors currently has an Audit Committee, a
Compensation Committee and a Governance and Nominating Committee.
During the fiscal year ended September 30, 2021, the Audit
Committee held five meetings, the Compensation Committee held four
meetings, and the Governance and Nominating Committee held five
meetings. Of our incumbent directors, during the year ended
September 30, 2021, all attended no fewer than 75 percent of (i)
the total number of meetings of the board of directors (including
consents to action in lieu of a meeting) held during the period for
which he has been a director, and (ii) the total number of meetings
held by all committees of the board on which he served during the
periods that he served. All of our incumbent directors attended the
2018 annual meeting of stockholders.
Director
Independence
We
currently have two independent directors on our board, Paul L.
Morris and Richard S. Langdon. The definition of “independent” used
herein is arbitrarily based on the independence standards of The
NASDAQ Stock Market LLC. The board performed a review to determine
the independence of Messrs. Morris and Langdon and made a
subjective determination as to each of these directors that no
transactions, relationships or arrangements exist that, in the
opinion of the board, would interfere with the exercise of
independent judgment in carrying out the responsibilities of a
director of GulfSlope Energy, Inc. In making these determinations,
the board reviewed information provided by these directors with
regard to each individual’s business and personal activities as
they may relate to us and our management.
Audit
Committee
We
maintain a separately-designated standing audit committee. The
Audit Committee currently consists of our two independent
directors, Paul L. Morris and Richard S. Langdon. The board of
directors has determined that Mr. Langdon is an audit committee
financial expert as defined in Item 5(d)(5) of Regulation S-K. The
primary purpose of the Audit Committee is to assist the board in
oversight of (1) the integrity of the financial statements of the
Company, (2) the compliance by the Company with legal and
regulatory requirements, (3) the performance of the Company’s
internal audit function and independent auditors, and (4) the
independent auditors’ qualifications and independence. The Audit
Committee meets privately with our management and with our
independent registered public accounting firm and evaluates the
responses by our management both to the facts presented and to the
judgments made by our outside independent registered public
accounting firm. Our Audit Committee has reviewed and discussed our
audited financial statements for the year ended September 30, 2021
with our management.
A
copy of the Audit Committee Charter can be found in our website at
www.gulfslope.com. The Charter establishes the independence of our
Audit Committee and sets forth the scope of the Audit Committee’s
duties. All members of the Audit Committee will be independent. The
Audit Committee is objective, and reviews and assesses the work of
our independent registered public accounting firm and our internal
accounting.
Report
of the Audit Committee
The
Audit Committee’s role in the Company’s corporate governance is
summarized above. Management has the primary responsibility for the
preparation and integrity of the Company’s financial statements,
accounting and financial reporting principles, and internal
controls and procedures designed to assure compliance with
accounting standards and applicable laws and regulations. The
Company’s independent registered public accounting firm is
responsible for performing an independent audit of the consolidated
financial statements and expressing an opinion on the conformity of
those financial statements with accounting principles generally
accepted in the United States of America.
In
fulfilling its oversight responsibilities, the Audit Committee has
reviewed and discussed the audited financial statements for the
period ended September 30, 2021, with the Company’s management and
has discussed with Pannell Kerr Forster of Texas, P.C. the matters
that are required to be discussed by Statement on Auditing
Standards No. 61, as amended (AICPA, Professional Standards,
Vol. 1. AU section 380), as adopted by the Public Company
Accounting Oversight Board in AS 1301. In addition, Pannell Kerr
Forster of Texas, P.C. has provided the Board the letter required
by the Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committees, as adopted by the Public
Company Accounting Oversight Board in AS 1301, and the Board has
discussed with Pannell Kerr Forster of Texas, P.C. their
independence.
The
members of the Audit Committee are not engaged professionally in
rendering, auditing or accounting services on behalf of the Company
nor are they Company employees. The Company’s management is
responsible for its accounting, financial management and internal
controls. As such, it is not the duty or responsibility of the
Audit Committee or its members to conduct “field work” or other
types of auditing or accounting reviews or procedures.
Based
on such reviews and discussions, the Audit Committee recommended
that the audited financial statements be included in the Company’s
annual report on Form 10-K for the year ended September 30, 2021,
with the SEC.
/s/
Richard S. Langdon |
/s/
Paul L. Morris |
Richard
S. Langdon |
Paul
L. Morris |
All
information within this “Audit Committee” section of the proxy
statement, including but not limited to the Report of the Audit
Committee, shall not be deemed to be “soliciting material,” or to
be “filed” with the SEC or subject to Regulation 14A or 14C (17 CFR
240.14a-1 through 240.14b-2 or 240.14c-1 through 240.14c-101) or to
the liabilities of section 18 of the Exchange Act. Such information
will not be deemed to be incorporated by reference into any filing
under the Securities Act or the Exchange Act.
Compensation
Committee
The
Compensation Committee discharges the responsibilities of our board
of directors relating to compensation of our directors and
executive officers, and meets regularly without management’s
presence. Under its charter, the Compensation Committee fulfills
its general responsibilities by: (a) reviewing and approving
corporate goals and objectives relevant to the compensation of the
chief executive officer; (b) evaluating the chief executive
officer’s performance in light of those goals and objectives; (c)
making recommendations to our board of directors with respect to
chief executive officer, director, and executive officer
compensation, incentive and equity-based compensation plans; (d)
producing a committee report on executive compensation; and (e)
conducting an annual performance evaluation of itself. This
committee also administers our equity-based compensation plan and
is given absolute discretion to, among other things, construe and
interpret the plan; to prescribe, amend and rescind rules and
regulations relating to the plan; to select the persons to whom
plan awards will be given; to determine the number of shares
subject to each plan award; and to determine the terms and
conditions to which each plan award is subject. The members of this
committee are Messrs. Morris and Langdon, each of whom is
independent. The Compensation Committee also has the authority to
obtain advice and assistance from external advisors, including
compensation consultants, although the Compensation Committee did
not elect to retain a compensation consultant to assist with
determining executive compensation during the present fiscal year.
A copy of the Compensation Committee Charter can be found in our
website at www.gulfslope.com.
Governance
and Nominating Committee
Under
its charter, the Governance and Nominating Committee assists our
board of directors by: (a) identifying individuals qualified to
become directors consistent with criteria approved by the board;
(b) selecting or recommending that the board select the director
nominees for the next annual meeting of stockholders; (c)
developing and recommending to the board a set of corporate
governance principles applicable to us that are consistent with
sound corporate governance practices and in compliance with
applicable legal, regulatory, or other requirements; (d) monitoring
and reviewing any other corporate governance matters which the
board may refer to this committee; and (e) overseeing the
evaluation of the board and management. The members of this
committee are Messrs. Morris and Langdon, each of whom is
independent. A copy of the Governance and Nominating Committee
Charter can be found in our website at
www.gulfslope.com.
Compensation
Committee Interlocks and Insider Participation
Currently,
no member of our Board’s Compensation Committee has served as an
officer or employee of the Company. None of the Company’s executive
officers serves on the board of directors or compensation committee
of a company that has an executive officer that serves on the
Company’s board of directors or Compensation Committee. No member
of the Company’s board of directors is an executive officer of a
company in which one of the Company’s executive officers serves as
a member of the board of directors or compensation committee of
that company.
The
Board’s Role in Risk Oversight
Risk
is inherent with every business, and how well a business manages
risk can ultimately determine its success. Management is
responsible for the day-to-day management of risks the company
faces, while the board of directors, as a whole and through its
committees, has responsibility for the oversight of risk
management. In its risk oversight role, the board of directors has
the responsibility to satisfy itself that the risk management
processes designed and implemented by management are adequate and
functioning as designed. The board of directors believes that
establishing the right “tone at the top” and that full and open
communication between executive management and the board of
directors are essential for effective risk management and
oversight.
The
board of directors as a whole has responsibility for risk
oversight, with reviews of certain areas being conducted by the
relevant board committees. These committees will then provide
reports to the full board. The oversight responsibility of the
board and its committees is enabled by management reporting
processes that are designed to provide visibility to the board
about the identification, assessment, and management of critical
risks and management’s risk mitigation strategies. These areas of
focus include strategic, operational, financial and reporting,
succession planning and compensation, compliance, and other risks.
The board of directors and its committees oversee risks associated
with their respective areas of responsibility, as summarized below.
Each committee will meet in executive session with key management
personnel and representatives of outside advisors as
appropriate.
Board/Committee |
|
Primary
Areas of Risk Oversight |
Full
Board of Directors |
|
Strategic,
financial and execution risks and exposures associated with our
business strategy, policy matters, significant litigation and
regulatory exposures, and other current matters that may present
material risk to our financial performance, operations,
infrastructure, plans, prospects or reputation, mergers and
acquisition activities and related integration matters, and
divestitures. |
|
|
Audit
Committee |
|
Risks
and exposures associated with financial matters, particularly
financial reporting, tax, accounting, disclosure, internal control
over financial reporting, investment guidelines and credit and
liquidity matters, our programs and policies relating to legal
compliance and strategy, and financial infrastructure. |
|
|
Nominating
and Governance Committee |
|
Risks
and exposures associated with director and management succession
planning, corporate compliance and ethics, corporate governance,
and overall board effectiveness, including appropriate allocation
of responsibility for risk oversight among the committees of the
Board. |
|
|
|
Compensation
Committee |
|
Risks
and exposures related to the attraction and retention of talent and
risks relating to the design of compensation programs and
arrangements, including incentive plans. We have determined that it
is not reasonably likely that compensation and benefit plans would
have a material adverse effect on the Company. |
Code
of Ethics
We
have adopted a written code of ethics and whistleblower policy (the
“Code of Ethics”) that applies to our principal executive officer,
principal financial officer, principal accounting officer or
controller, and persons performing similar functions. We believe
that the Code of Ethics is reasonably designed to deter wrongdoing
and promote honest and ethical conduct; provide full, fair,
accurate, timely and understandable disclosure in public reports;
comply with applicable laws; ensure prompt internal reporting of
code violations; and provide accountability for adherence to the
code. A copy of our Code of Ethics is available on our website at
www.gulfslope.com.
Director
Nomination Process
Director
Qualifications. Our Nominating and Governance Committee has not
formally established any specific qualifications that must be met
by each candidate for the board of directors or specific qualities
or skills that are necessary for one or more of the members of the
board of directors to possess. However, we seek board members who
are highly qualified individuals with diverse backgrounds, have an
understanding of the Company’s business and industry on a technical
level, have good judgment and skills and have depth and breadth of
professional experience or other background
characteristics.
Identifying
Nominees. The Nominating and Governance Committee, on a
periodic basis, will solicit ideas for possible candidates from
members of the board of directors, executive officers and
individuals personally known to members of the board of directors.
In addition, the Nominating and Governance Committee is authorized
to use its authority under its charter to retain at the Company’s
expense one or more search firms to identify candidates (and to
approve such firms’ fees and other retention terms). Prospective
candidates recommended by stockholders are also considered (as
discussed below).
Stockholder
Nominations. Our Nominating and Governance Committee will
consider director nominees recommended by stockholders. Pursuant to
the charter of our Nominating and Governance Committee, any
candidates recommended by stockholders will be reviewed and
evaluated against the same criteria applicable to the evaluation of
candidates proposed by our directors, executive officers,
third-party search firms or other sources.
Review
of Director Nominees. In evaluating proposed director
candidates, the Nominating and Governance Committee may consider,
in addition to any minimum qualifications and other criteria for
board of directors’ membership approved by the board of directors
from time to time, all facts and circumstances that it deems
appropriate or advisable, including, among other things, the
proposed director candidate’s understanding of the Company’s
business and industry on a technical level, his or her judgment and
skills, his or her depth and breadth of professional experience or
other background characteristics, his or her independence, his or
her willingness to devote the time and effort necessary to be an
effective board member, and the needs of the board of directors. We
do not have a policy with regard to the consideration of diversity
in identifying director nominees. However, our Nominating and
Governance Committee takes into account diversity in professional
experience, skills and background, and diversity in race and
gender, in considering prospective director nominees and committee
appointments and planning for director succession. The Nominating
and Governance Committee considers at least annually, and
recommends to the board of directors suggested changes to, if any,
the size, composition, organization and governance of the board of
directors and its committees.
Stockholder
Communications
The
board welcomes communications from our stockholders, and maintains
a process for stockholders to communicate with the board.
Stockholders who wish to communicate with the board may send a
letter to Corporate Secretary, at 1000 Main Street, Suite 2300,
Houston, Texas 77002. The mailing envelope must contain a clear
notation indicating that the enclosed letter is a
“Stockholder-Board Communication.” All such letters should identify
the author as a security holder. All such letters will be reviewed
by the Secretary and submitted to the entire board no later than
the next regularly scheduled board meeting. Stockholders wishing to
submit proposals for inclusion in the proxy statement relating to
the 2023 annual stockholders meeting should follow the procedures
specified under “PROPOSALS FOR NEXT ANNUAL MEETING” in this
proxy statement.
COMPENSATION
DISCUSSION
Compensation
to Officers of the Company
The
following tables contain compensation data for our named executive
officers for the fiscal years ended September 30, 2021 and
2020:
Summary Compensation Table |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name and
Principal Position |
|
|
Year |
|
|
|
Salary |
|
|
|
Bonus |
|
|
|
Stock
Awards |
|
|
|
Stock
Option Awards |
|
|
|
All
Other
Compensation |
|
|
|
Total |
|
John
N. Seitz(1) |
|
|
2021 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
CEO |
|
|
2020 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
John H. Malanga |
|
|
2021 |
|
|
|
150,000 |
|
|
|
— |
|
|
|
— |
|
|
|
34,100 |
|
|
|
— |
|
|
|
184,100 |
|
CFO |
|
|
2020 |
|
|
|
71,250 |
|
|
|
— |
|
|
|
— |
|
|
|
262,000 |
|
|
|
— |
|
|
|
333,250 |
|
(1) |
Mr.
Seitz is not currently receiving or accruing any compensation as of
the date of this Proxy Statement. |
Employment
and Consulting Arrangements
Not
applicable.
Compensation
Policies and Practices as they Relate to the Company’s Risk
Management
Not
applicable.
Director
Compensation
In
January of 2017, the Company’s nonemployee directors were each
awarded 2,500,000 stock options for the Company’s stock at an
exercise price of $0.0278 per share, 50% vested in January 2017 and
50% vested in January of 2018. The stock options will expire in
January 2024. In June of 2018, the Company’s nonemployee directors
were each awarded 4,500,000 stock options for the Company’s stock
at an exercise price of $0.075 per share, 1.5 million vested in
June 2018, and 1.5 million vested in June 2019 and 1.5 million
vested in June 2020. The stock options will expire in December
2025. In January 2021, the Company’s nonemployee directors were
each awarded 5,000,000 stock options for the Company’s stock at an
exercise price of $0.004 per share, 2.5 million vested in July
2021, and 2.5 million vested in January 2022. The stock options
will expire in December 2025.
Grants
of Plan-Based Awards
The
Company stockholders approved the 2018 Omnibus Incentive Plan in
May of 2018. Restricted stock and stock option awards made after
this date, to executives, employees, and directors were made
pursuant to the plan.
Outstanding
Equity Awards at Fiscal Year End
In
October 2013, two million stock options were awarded with an
exercise price of $0.12 and have an expiration of October 2023. In
January 2017, 28.5 million stock options were awarded to GulfSlope
Energy executives and employees and five million to directors. The
exercise price of the stock options is $0.0278 and they expire in
January 2024. In May 2018, 0.5 million stock options were awarded
to an employee, the exercise price is $0.065 and they expire in
December 2025. In June 2018, 67.5 million stock options were
awarded to GulfSlope Energy executives, employees, consultants and
directors. The exercise price of the stock options is $0.075 and
they expire in December 2025. On January 2, 2019, the Company
issued 1 million stock options to a former employee and consultant.
The exercise price of the stock options is $0.045 and they expire
in December 2025. All of the 2013 through 2019 stock option awards
are fully vested. In January 2021, 41.5 million stock options were
awarded to GulfSlope Energy executives, employees, consultants and
directors. The exercise price of the options is $0.004 per share
and 50% of the options vested in July 2021 and 50% vested in
January 2022. The expiration date of the options is December 31,
2025.
Delinquent
Section 16(a) Reports
Section
16(a) of the Securities Exchange Act of 1934 requires our directors
and executive officers, and persons who own beneficially more than
ten percent of our common stock, to file reports of ownership and
changes of ownership with the Securities and Exchange Commission.
Based solely upon a review of Forms 3, 4 and 5 furnished to us
during the fiscal year ended September 30, 2021, we believe that
the directors, executive officers, and greater than ten percent
beneficial owners have complied with all applicable filing
requirements during the fiscal year ended September 30,
2021.
Related
Person Transactions
During
April 2013 through September 2017, the Company entered into
convertible promissory notes whereby it borrowed a total of
$8,675,500 from John Seitz, the chief executive officer (“CEO”).
The notes are due on demand, bear interest at the rate of 5% per
annum, and $5,300,000 of the notes are convertible into shares of
common stock at a conversion price equal to $0.12 per share of
common stock (the then offering price of shares of common stock to
unaffiliated investors). As of September 30, 2021 and 2020, the
total amount owed to John Seitz is $8,675,500. This amount is
included in loans from related parties within the condensed balance
sheets. There was approximately $2.96 million and $2.52 million,
respectively, of unpaid interest associated with these loans
included in accrued interest payable within the balance sheet as of
September 30, 2021 and 2020.
On
November 15, 2016, a family member of the CEO entered into a
$50,000 convertible promissory note with associated warrants under
the same terms received by other investors (see Note 7).
Domenica
Seitz CPA, who is related to the CEO, has provided accounting
services to the Company, as a consultant and beginning October 2020
as an employee. During the years ended September 30, 2021 and 2020,
the services provided were valued at approximately $75,000 and
$60,000, respectively. The amount owed to this related party totals
approximately $346,000 as of September 30, 2021 and 2020,
respectively. The Company has accrued these amounts, and they have
been reflected in related party payable in the September 30, 2021
and 2020 financial statements.
Security
Ownership of Certain Beneficial Owners and
Management
The
following table sets forth the number and percentage of outstanding
shares of common stock owned by: (a) each of our directors; (b)
each person who is known by us to be the beneficial owner of more
than 5% of our outstanding shares of common stock; (c) the named
executive officers as defined in Item 402 of Regulation S-K; and
(d) all current directors and executive officers, as a group. As of
August 12, 2022, there were 1,268,240,346 shares of common stock
deemed issued and outstanding.
Unless
otherwise stated, beneficial ownership has been determined in
accordance with Rule 13d-3 under the Exchange Act. Under this rule,
certain shares may be deemed to be beneficially owned by more than
one person (if, for example, persons share the power to vote or the
power to dispose of the shares). In addition, shares are deemed to
be beneficially owned by a person if the person has the right to
acquire shares (for example, upon exercise of an option or warrant)
within 60 days of the date as of which the information is provided.
In computing the percentage ownership of any person or group of
persons, the number of shares beneficially owned by such person or
group of persons is deemed to include the number of shares
beneficially owned by such person or the members of such group by
reason of such acquisition rights, and the total number of shares
outstanding is also deemed to include such shares (but not shares
subject to similar acquisition rights held by any other person or
group) for purposes of that calculation. As a result, the
percentage of outstanding shares of any person as shown in the
following table does not necessarily reflect the person’s actual
voting power at any particular date. To our knowledge, except as
indicated in the footnotes to this table and pursuant to applicable
community property laws, the persons named in the table have sole
voting and investment power with respect to all shares of common
stock shown as beneficially owned by them. The address for each of
the beneficial owners is the Company’s address.
Named
Executives Officers and Directors |
|
Beneficially
Owned
Shares
of Common Stock
|
|
|
Percentage
of Beneficially
Owned
Common Stock
|
|
John
N. Seitz (1) |
|
|
261,391,324 |
|
|
|
20.6 |
% |
John
H. Malanga (3) |
|
|
46,666,667 |
|
|
|
3.7 |
% |
Richard
S. Langdon (4) |
|
|
12,916,667 |
|
|
|
1.0 |
% |
Paul
L. Morris (2) |
|
|
14,228,038 |
|
|
|
1.1 |
% |
All
Executive Officers & Directors |
|
|
335,202,696 |
|
|
|
26.4 |
% |
|
|
|
|
|
|
|
|
|
Greater
than 5% Stockholders |
|
|
|
|
|
|
|
|
Delek
GOM Investments LLC |
|
|
294,018,459 |
|
|
|
23.2 |
% |
(1) |
Includes
44,166,667 shares of common stock underlying the convertible demand
note in the principal amount of $5.3 million and 17,639,101 shares
underlying the convertible accrued interest in the amount of
$2,116,692. |
(2) |
Includes
61,371 shares of common stock held by the Morris Family Limited
Partnership LP, a partnership of which an entity controlled by Mr.
Morris is the general partner and 2,500,000 stock options awarded
in January 2017, one-half vested in January of 2017 and one-half
vested in January 2018. Includes 4,500,000 stock options awarded in
June 2018, one-third vested in June of 2018, one-third vested in
June 2019 and one-third vested in June 2020. Includes 5,000,000
stock options awarded in January 2021, one-half vested in July of
2021, one-half vested in January 2022. |
(3) |
Includes
15,000,000 stock options awarded in January 2017, one-half vested
in January of 2017 and one-half vested in January 2018. Includes
18,000,000 stock options awarded in June 2018, one-third vested in
June of 2018, one-third vested in June 2019 and one-third vested in
June 2020. Includes 11,000,000 stock options awarded in January
2021, one-half vested in July of 2021, one-half vested in January
2022. |
(4) |
Includes
2,500,000 stock options awarded in January 2017, one-half vested in
January of 2017 and one-half vested in January 2018. Includes
4,500,000 stock options awarded in June 2018, one-third vested in
June of 2018, one-third vested in June 2019 and one-third vested in
June 2020. Includes 5,000,000 stock options awarded in January
2021, one-half vested in July of 2021, one-half vested in January
2022. |
Securities
Authorized for Issuance under Equity Compensation
Plans
The
following table sets forth information with respect to the equity
compensation plans available to directors, officers, certain
employees and certain consultants of the Company at September 30,
2021.
|
|
(a) |
|
|
(b) |
|
|
(c) |
|
Plan
category |
|
Number
of
securities
to
be
issued upon
exercise
of
outstanding
stock
options(1)
|
|
|
Weighted-average
exercise
price of
outstanding
stock
options
|
|
|
Number
of
securities
remaining
available
for
future
issuance
under
equity
compensation
plans(2)
|
|
Equity
compensation plans approved by security holders |
|
|
146,000,000 |
|
|
$ |
0.0444 |
|
|
|
—19,970,000 |
|
Equity
compensation plans not approved by security holders |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total |
|
|
146,000,000 |
|
|
|
|
|
|
|
—19,970,000 |
|
(1)
|
This
column reflects the maximum number of shares of our common stock
subject to stock option awards granted as Inducement Shares or
under the 2014 and 2018 Omnibus Incentive Plans vested and
unvested. |
(2)
|
This
column reflects the total number of shares of our common stock
remaining available for issuance under the 2014 and 2018 Omnibus
Incentive Plans. |
PROPOSAL
2 – RATIFICATION OF SELECTION OF INDEPENDENT
REGISTERED
PUBLIC
ACCOUNTING FIRM
The
board of directors has selected Pannell Kerr Forster of Texas, P.C.
as our independent registered public accounting firm for the
current fiscal year. Pannell Kerr Forster of Texas, P.C. has served
as our independent registered public accounting firm continuously
since November 1, 2019. The board of directors wishes to obtain
from the stockholders a ratification of the board’s action in
selecting Pannell Kerr Forster of Texas, P.C. for the fiscal year
ending September 30, 2022. Such ratification requires the
affirmative vote of a majority of the shares of common stock
present or represented by proxy and entitled to vote at the Annual
Meeting. We do not anticipate a representative from Pannell Kerr
Forster of Texas, P.C. to be present at the meeting.
Although
not required by law or otherwise, the selection is being submitted
to the stockholders for their approval as a matter of good
corporate practice. In the event the selection of Pannell Kerr
Forster of Texas, P.C. as our independent registered public
accounting firm is not ratified by the stockholders, the adverse
vote will be considered as a direction to the board of directors to
reconsider whether or not to retain that firm as independent
registered public accounting firm for the fiscal year ending
September 30, 2022. Even if the selection is ratified, the board of
directors in its discretion may direct the selection of a different
independent accounting firm at any time during or after the year if
it determines that such a change would be in the best interests of
us and our stockholders.
OUR
BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” RATIFICATION OF THE
SELECTION OF PANNELL KERR FORSTER OF TEXAS, P.C. AS OUR INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING
SEPTEMBER 30, 2022.
Audit
Fees and Services
For
the fiscal years ended September 30, 2021and 2020 professional
services were performed by Pannell Kerr Forster of Texas, P.C. The
aggregate fees billed by Pannell Kerr Forster of Texas, P.C. for
the fiscal year ended September 30, 2021 were as
follows:
|
|
September
30,
2021 |
|
Audit
Fees (1) |
|
$ |
101,000 |
|
Audit-Related
Fees (2) |
|
|
67,000 |
|
Tax
Fees (3) |
|
|
17,000 |
|
All
Other Fees |
|
|
— |
|
|
(1) |
Audit
services include fees for professional services rendered only for
the audit of the Company’s annual financial statements for the
fiscal year ended September 30, 2021. |
|
(2) |
Audit-related
services primarily include fees for assurance and related services
by our principal accountants that are reasonably related to the
performance of the review of our financial statements for the
quarterly periods December 31, 2020, March 31, 2021 and June 30,
2021. |
|
(3) |
Tax
services include fees for assistance with tax preparation and
compliance during the year ended September 30, 2021. |
Audit
Committee Pre-Approval Policies and Procedures
The
Audit and Compliance Committee has adopted policies and procedures
that will require the Company to obtain the Committee’s
pre-approval of all audit and permissible non-audit services to be
provided by the Company’s independent registered public accounting
firm. The Committee pre-approved 100% of the non-audit services
provided to the Company by Pannell Kerr Forster of Texas,
P.C.
PROPOSAL
3 – APPROVAL OF AN AMENDMENT TO OUR CERTIFICATE OF INCORPORATION TO
INCREASE THE AUTHORIZED SHARES OF COMMON STOCK
The
board has unanimously approved an amendment to the Company’s
certificate of incorporation to increase the number of shares of
common stock authorized for issuance from 1,500,000,000 to
3,000,000,000. At the Annual Meeting, the stockholders will be
asked to consider and vote upon this proposed amendment. The
amendment as described in this Proposal 3, if approved by the
Company’s stockholders, would become effective as set forth in the
form of certificate of amendment to certificate of incorporation
which is annexed to this proxy statement as Exhibit A, to be
filed with the Delaware Secretary of State.
The
terms of the additional shares of common stock will be identical to
those of the currently outstanding shares of common stock and will
not affect the relative voting power or equity interest of any
stockholder. However, because holders of common stock have no
preemptive rights to purchase or subscribe for any unissued stock
of the Company, the issuance of additional shares of common stock
will reduce the current stockholders’ percentage ownership interest
in the total outstanding shares of common stock. This amendment and
the creation of additional shares of authorized common stock will
not alter the current number of issued shares.
Reasons
for Amendment to Certificate of Incorporation
Currently,
the Company’s certificate of incorporation authorizes the issuance
of 1,550,000,000 shares of capital stock, 1,500,000,000 of which
are designated as common stock and 50,000,000 of which are
designated as preferred stock. The Company has not designated or
issued any preferred stock. As of the Record Date, there were
1,268,240,346 shares of common stock issued and outstanding and
288,849,968 shares of common stock underlying outstanding
derivative securities. As of the Record Date, not including the
shares underlying the Company’s outstanding derivate securities, we
have 231,759,654 shares of common stock that are authorized to be
issued and are unissued.
We do
not presently have any agreements, commitments or arrangements
regarding the 1,500,000,000 shares of our common stock that would
be newly authorized upon the increase to our authorized capital
stock as contemplated in this proposal. The common stock does not
have any cumulative voting, preemptive, subscription or conversion
rights.
The
Effects on the Increase in the Company’s Authorized Shares of
Common Stock
The
amendment will not affect the relative voting power or equity
interest of any stockholder. Additional shares of common stock,
however, would continue to be available for issuance from time to
time in the future. The shares issued pursuant to the increase in
the authorized shares, will dilute the percentage ownership
interest of existing holders of our common stock and the value of
the shares held by such stockholders may be diluted.
The
Company’s certificate of incorporation presently authorizes
1,500,000,000 shares of common stock and 50,000,000 shares of
preferred stock. The adoption of the proposal to amend the
Company’s certificate of incorporation would increase the
authorized number of shares common stock from 1,500,000,000 to
3,000,000,000. For illustrative purposes only, the following table
shows the effect on our authorized shares of common stock if the
increase in authorized shares pursuant to this proposal is
effected:
|
|
On
Record Date |
|
|
Assuming
Approval of Amendment |
|
Authorized
Shares of Common Stock |
|
|
1,500,000,000 |
|
|
|
3,000,000,000 |
|
Issued
and Outstanding Shares of Common Stock* |
|
|
1,268,240,346 |
|
|
|
1,268,240,346 |
|
Shares
of Common Stock available for future issuance |
|
|
231,759,654 |
|
|
|
1,731,759,654 |
|
*
This does not include 288,849,968 shares of common stock underlying
outstanding derivative securities.
As a
result of the amendment, additional shares of common stock would be
available from time to time in the future, for any proper corporate
purpose, including equity financings, stock splits, stock
dividends, acquisitions, stock option plans and other employee
benefit plans, and for strategic transactions. We believe that the
availability of the additional shares will provide us with the
flexibility to meet business needs as they arise, to take advantage
of favorable opportunities and to respond to a changing corporate
environment. Common stock does not have any cumulative voting,
preemptive, subscription or conversion rights
The
increased proportion of unissued authorized shares to issued shares
could also, under certain circumstances, have an anti-takeover
effect. For example, the issuance of a large block of common stock
could dilute the ownership of a person seeking to effect a change
in the composition of our board or contemplating a tender offer or
other transaction. However, the increase in authorized capital
stock has not been authorized in response to any effort of which
the Company is aware to accumulate shares of our capital stock to
obtain control of the Company. The board is not aware of any
attempt, or contemplated attempt, to acquire control of the
Company.
Our
certificate of incorporation and bylaws currently include certain
other provisions that may have an anti-takeover effect, including
the board of directors’ right to issue preferred stock without
obtaining additional approval of our stockholders. Other than
Proposal 3, the Board does not currently contemplate recommending
the adoption of any other amendments to our certificate of
incorporation that could be construed to reduce or interfere with
the ability of third parties to take over or change the control of
our Company. Additionally, the Company has no current plans to use
the newly authorized shares of common stock in connection with any
merger, consolidation, or other business combination
transaction.
THE
BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” APPROVAL OF THE
AMENDMENT TO OUR CERTIFICATE OF INCORPORATION TO INCREASE THE
AUTHORIZE SHARES OF COMMON STOCK.
PROPOSAL
4 – REVERSE STOCK SPLIT OF OUR OUTSTANDING COMMON
STOCK
IN
A RATIO OF BETWEEN ONE-FOR-TWO AND ONE-FOR-200
The
board of directors has approved, subject to approval by our
stockholders, effecting a reverse stock split of all of our
outstanding common stock at a ratio of between one-for-two and
one-for-200 (the “Exchange Ratio”), with our board having the sole
discretion as to whether or not the reverse split is to be
effected, and with the exact Exchange Ratio of any reverse split to
be set at a whole number within the above range as determined by
our board in its sole discretion (the “Reverse Stock Split”). Our
board will have sole discretion to elect, at any time before the
earlier of (a) September 30, 2023, and (b) the date of our next
annual meeting of stockholders, as it determines to be in our best
interest, whether or not to effect the Reverse Stock Split, and, if
so, at what Exchange Ratio.
The
determination as to whether to effect the Reverse Stock Split, and
which Exchange Ratio will apply, will be based upon those market or
business factors deemed relevant by the board of directors at that
time, including, but not limited to:
|
● |
listing
standards under any national securities exchange to which we are
subject, if any; |
|
● |
existing
and expected marketability and liquidity of our common
stock; |
|
● |
prevailing
stock market conditions; |
|
● |
the
historical trading price and trading volume of our common
stock; |
|
● |
the
then prevailing trading price and trading volume of our common
stock and the anticipated impact of the reverse split on the
trading market for our common stock; |
|
● |
the
anticipated impact of the reverse split on our ability to raise
additional financing; |
|
● |
business
developments affecting us; |
|
● |
our
actual or forecasted results of operations; and |
|
● |
the
likely effect on the market price of our common stock. |
If
our board determines that effecting the Reverse Stock Split is in
our best interest, the Reverse Stock Split will become effective
upon the filing of an amendment to our certificate of incorporation
with the Secretary of State of the State of Delaware. The form of
the proposed amendment to our certificate of incorporation to
affect the Reverse Stock Split is attached to this proxy statement
as Exhibit B (the “Amendment”). The Amendment filed thereby
will set forth the number of shares to be combined into one share
of our common stock within the limits set forth above, but will not
have any effect on the number of shares of common stock or
preferred stock then authorized, the ability of our board of
directors to designate preferred stock, the par value of our common
or preferred stock, or any series of preferred stock previously
authorized (except to the extent such Reverse Stock Split adjusts
the conversion ratio of such preferred stock, provided that no
shares of our preferred stock are currently outstanding). The form
of Amendment attached hereto shall be subject to technical,
administrative or similar changes and modifications as determined
in the discretion of our officers, to the extent required to comply
with Delaware law or affect the timing of the Reverse Stock Split,
to the extent such changes and modifications do not individually or
in the aggregate, adversely affect the rights of our
stockholders.
Purpose
of the Reverse Stock Split
We
believe that the increased market price of our common stock
expected as a result of implementing the Reverse Stock Split may
improve the marketability and liquidity of our common stock and
encourage interest and trading in our common stock. Because of the
trading volatility often associated with low-priced stocks, many
brokerage houses and institutional investors have internal policies
and practices that either prohibit them from investing in
low-priced stocks or tend to discourage individual brokers from
recommending low-priced stocks to their customers. Some of those
policies and practices may function to make the processing of
trades in low-priced stocks economically unattractive to brokers.
Moreover, because brokers’ commissions on low-priced stocks
generally represent a higher percentage of the stock price than
commissions on higher-priced stocks, the current average price per
share of common stock can result in individual stockholders paying
transaction costs representing a higher percentage of their total
share value than would be the case if the share price were
substantially higher. Although it should be noted that the
liquidity of our common stock may be harmed by the Reverse Stock
Split given the reduced number of shares that would be outstanding
after the Reverse Stock Split, our board of directors is hopeful
that the anticipated higher market price will offset, to some
extent, the negative effects on the liquidity and marketability of
our common stock inherent in some of the policies and practices of
institutional investors and brokerage houses described
above.
Board
Discretion to Implement the Reverse Stock Split
The
Reverse Stock Split will be affected, if at all, only upon a
determination by the board of directors that the Reverse Stock
Split is in the best interests of the company and our stockholders.
The board of directors’ determination as to whether the Reverse
Stock Split will be effected and, if so, at which Exchange Ratio,
will be based upon certain factors, including existing and expected
marketability and liquidity of our common stock, prevailing stock
market conditions, business developments affecting us, actual or
forecasted results of operations and the likely effect on the
market price of our common stock. If the board does not act to
implement the Reverse Stock Split prior to the earlier of (a)
September 30, 2023; and (b) the date of our next annual meeting of
stockholders, the authorization for the Reverse Stock Split will be
deemed withdrawn.
Effect
of the Reverse Stock Split
If
implemented by the board of directors, as of the effective time of
the Amendment, each issued and outstanding share of our common
stock would immediately and automatically be reclassified and
reduced into a fewer number of shares of our common stock,
depending upon the Exchange Ratio selected by the board of
directors, which could range between one-for-two and one-for-200,
provided that all fractional shares as a result of the split shall
be automatically rounded up to the next whole share on a per
stockholder basis.
Except
to the extent that the Reverse Stock Split would result in any
stockholder receiving an additional whole share of common stock in
connection with the rounding of fractional shares or any dilution
to other stockholder in connection therewith, as described below,
the Reverse Stock Split will not:
|
● |
affect
any stockholder’s percentage ownership interest in us; |
|
● |
affect
any stockholder’s proportionate voting power; |
|
● |
substantially
affect the voting rights or other privileges of any stockholder;
or |
|
● |
alter
the relative rights of stockholders, warrant holders or holders of
equity compensation plan awards and options. |
Depending
upon the Exchange Ratio selected by the board of directors, the
principal effects of the Reverse Stock Split are:
|
● |
the
number of shares of common stock issued and outstanding will be
reduced by a factor ranging between two and 200; and |
|
● |
the
per share exercise price will be increased by a factor between two
and 200, and the number of shares issuable upon exercise shall be
decreased by the same factor, for all outstanding options, warrants
and other convertible or exercisable equity instruments entitling
the holders to purchase shares of our common stock. |
The
following table contains approximate information relating to our
common stock, our outstanding warrants and the amount outstanding
under the Plan, under various exchange ratio options:*
|
|
Pre-Reverse
Split
|
|
|
1 for 2 |
|
|
1 for 100 |
|
|
1 for 200 |
|
Authorized Common Stock |
|
|
3,000,000,000 |
|
|
|
3,000,000,000 |
|
|
|
3,000,000,000 |
|
|
|
3,000,000,000 |
|
Outstanding Common Stock |
|
|
1,268,240,346 |
|
|
|
634,120,173 |
|
|
|
12,682,403 |
|
|
|
6,341,202 |
|
Reserved for issuance in connection with the exercise and
conversion of outstanding derivative securities |
|
|
288,849,968 |
|
|
|
144,424,984 |
|
|
|
2,888,500 |
|
|
|
1,444,250 |
|
Total Outstanding and Reserved Shares |
|
|
1,557,090,314 |
|
|
|
778,545,157 |
|
|
|
15,570,903 |
|
|
|
7,785,452 |
|
Shares available for future issuance |
|
|
1,442,909,686 |
|
|
|
2,221,454,843 |
|
|
|
2,984,429,097 |
|
|
|
2,992,214,548 |
|
*
Assumes the increase in the authorized common stock from
1,500,000,000 to 3,000,000,000 (Proposal 3) is approved by
stockholders and effected. Does not take into account the rounding
of fractional shares described below under “Fractional
Shares.”
If
the Reverse Stock Split is implemented, the Amendment will not
reduce the number of shares of our common stock or preferred stock
authorized under our certificate of incorporation, as amended, the
right of our board of directors to designate preferred stock, the
par value of our common or preferred stock, or otherwise effect our
designated series of preferred stock (of which no shares are
outstanding).
Our
common stock is currently registered under Section 12(g) of the
Exchange Act, and we are subject to the periodic reporting and
other requirements thereof. We presently do not have any intent to
seek any change in our status as a reporting company under the
Exchange Act either before or after the Reverse Stock Split, if
implemented, and the Reverse Stock Split, if implemented, will not
result in a going private transaction.
Additionally,
as of the date of this proxy statement, we do not have any current
plans, agreements, or understandings with respect to the authorized
shares that will become available for issuance after the Reverse
Stock Split has been implemented.
Fractional
Shares
Stockholders
will not receive fractional shares in connection with the Reverse
Stock Split. Instead, stockholders otherwise entitled to fractional
shares will receive an additional whole share of our common stock.
For example, if the board of directors’ effects a one-for-five
split, and you held four shares of our common stock immediately
prior to the effective date of the Amendment, you would hold one
share of our common stock following the Reverse Stock
Split.
Effective
Time and Implementation of the Reverse Stock Split
The
effective time for the Reverse Stock Split will be the date on
which we file the Amendment with the office of the Secretary of
State of the State of Delaware or such later date and time as
specified in the Amendment, provided that the effective date must
occur prior to the earlier of (a) September 30, 2023; and (b) the
date of our next annual meeting of stockholders.
Our
transfer agent will act as exchange agent for purposes of
implementing the exchange of stock certificates. As soon as
practicable after the effective time, a letter of transmittal will
be sent to our stockholders of record as of the effective time for
purposes of surrendering to the transfer agent certificates
representing pre-Reverse Stock Split shares in exchange for
certificates representing post-Reverse Stock Split shares in
accordance with the procedures set forth in the letter of
transmittal. No new certificates will be issued to a stockholder
until such stockholder has surrendered such stockholder’s
outstanding certificate(s), together with the properly completed
and executed letter of transmittal, to the exchange agent. From and
after the effective time, any certificates formerly representing
pre-Reverse Stock Split shares which are submitted for transfer,
whether pursuant to a sale, other disposition or otherwise, will be
exchanged for certificates representing post-Reverse Stock Split
shares.
STOCKHOLDERS
SHOULD NOT DESTROY ANY STOCK CERTIFICATE(S) AND SHOULD NOT SUBMIT
ANY STOCK CERTIFICATE(S) UNTIL THE REVERSE SPLIT IS EFFECTIVE, IF
AT ALL.
Accounting
Matters
The
Reverse Stock Split will not affect the par value of our common
stock ($0.001 per share). However, at the effective time of the
Reverse Stock Split, the stated capital attributable to common
stock on our balance sheet will be reduced proportionately based on
the Exchange Ratio (including a retroactive adjustment of prior
periods), and the additional paid-in capital account will be
credited with the amount by which the stated capital is reduced.
Reported per share net income or loss would be expected to be
proportionally higher because there will be fewer shares of our
common stock outstanding.
No
Appraisal Rights
Under
Delaware Law, our stockholders are not entitled to appraisal rights
with respect to the Reverse Stock Split.
Certain
Risks Associated with the Reverse Stock Split
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● |
The
price per share of our common stock after the Reverse Stock Split
may not reflect the Exchange Ratio implemented by the board of
directors and the price per share following the effective time of
the Reverse Stock Split may not be maintained for any period of
time following the Reverse Stock Split. Accordingly, the total
market capitalization of our common stock following a Reverse Stock
Split may be lower than before the Reverse Stock Split. |
|
|
|
|
● |
Effecting
the Reverse Stock Split may not attract institutional or other
potential investors, or result in a sustained market price that is
high enough to overcome the investor policies and practices, and
other issues relating to investing in lower priced stock described
in “Purpose of the Reverse Stock Split” above. |
|
|
|
|
● |
The
trading liquidity of our common stock could be adversely affected
by the reduced number of shares outstanding after the Reverse Stock
Split. |
|
|
|
|
● |
If a
Reverse Stock Split is implemented by the board of directors, some
stockholders may consequently own less than 100 shares of our
common stock. A purchase or sale of less than 100 shares (an
“odd lot” transaction) may result in incrementally higher
trading costs through certain brokers, particularly “full
service” brokers. Therefore, those stockholders who own fewer
than 100 shares following the Reverse Stock Split may be required
to pay higher transaction costs if they should then determine to
sell their shares of our common stock. |
|
|
|
|
● |
A
stockholder who receives a “round up” from a fractional share to a
whole share, as discussed above, may have a tax event based on the
value of the “rounded up” share. We believe such tax event will be
minimal or insignificant for most stockholders. |
Potential
Anti-Takeover Effect
The
increased proportion of unissued authorized shares to issued shares
could, under certain circumstances, have an anti-takeover effect
(for example, by permitting issuances that would dilute the stock
ownership of a person seeking to effect a change in the composition
of our board or contemplating a tender offer or other transaction
for our combination with another company). However, the Reverse
Stock Split was not approved in response to any effort of which we
are aware to accumulate shares of our common stock or obtain
control of us, nor is it part of a plan by management to recommend
a series of similar amendments to our board and
stockholders.
Federal
Income Tax Consequences of the Reverse Stock Split
A
summary of the federal income tax consequences of the Reverse Stock
Split to individual stockholders is set forth below. It is based
upon present federal income tax law, which is subject to change,
possibly with retroactive effect. The discussion is not intended to
be, nor should it be relied on as, a comprehensive analysis of the
tax issues arising from or relating to the Reverse Stock Split. In
addition, we have not requested and will not seek an opinion of
counsel or a ruling from the Internal Revenue Service regarding the
federal income tax consequences of the Reverse Stock Split.
Accordingly, stockholders are advised to consult their own tax
advisors for more detailed information regarding the effects of the
Reverse Stock Split on them under applicable federal, state, local
and foreign income tax laws.
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● |
We
believe that the Reverse Stock Split will be a tax-free
recapitalization for federal income tax purposes. Accordingly, a
stockholder will generally not recognize any gain or loss as a
result of the receipt of the post-reverse split common stock
pursuant to the Reverse Stock Split. However, a stockholder who
receives a “round up” from a fractional share to a whole share may
have a tax event based on the value of the “rounded up” share
provided to the stockholder. We believe such tax event will be
minimal or insignificant for most stockholders. |
|
|
|
|
● |
The
shares of post-reverse split common stock in the hands of a
stockholder will have an aggregate basis for computing gain or loss
equal to the aggregate basis of the shares of pre-reverse split
common stock held by that stockholder immediately prior to the
Reverse Stock Split. |
|
|
|
|
● |
A
stockholder’s holding period for the post-reverse split common
stock will include the holding period of the pre-reverse split
common stock exchanged. |
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” APPROVAL OF THE
AMENDMENT TO OUR CERTIFICATE OF INCORPORATION TO authorize our
board of directors, without further stockholder approval, to effect
a reverse stock split.
PROPOSAL
5 – APPROVAL OF AN AMENDMENT TO eliminate reference to the
classification of the board of directors into classes with
staggered terms
At
our annual meeting of stockholders held on May 29, 2014,
stockholders approved an amendment to our certificate of
incorporation to provide for the classification of the board of
directors into three classes with staggered terms. This amendment
was adopted and became effective on May 29, 2014 when we filed the
Amended and Restated Certificate of Incorporation with the
Secretary of State of the State of Delaware. The implementation of
this amendment was to commence with the 2015 annual meeting of
stockholders. We did not hold a subsequent annual meeting of
stockholders until 2018, however, and the staggered board
classifications were never implemented. Accordingly, the board of
directors deems it in the best interest of stockholders to
eliminate reference to the classification of the board of directors
into classes with staggered terms, as reflected in the form of
certificate of amendment to certificate of incorporation which is
annexed to this proxy statement as Exhibit C.
Although
the Company still believes that implementing a staggered board can
provide important benefits to the Company and its stockholders,
such as discouraging third parties from attempting certain types of
takeover and change of control transactions, and providing
continuity and stability of the Company’s business strategies and
management of the Company’s business because a majority of the
board of directors at any given time will have prior experience as
directors of the Company, at this time, the board of directors
believes that implementing a staggered board might be
counterproductive given the size of the company and the board—there
are presently only three members. Further, the Company is not aware
of any present third-party plans to takeover or gain control of the
Company, and such an action seems unlikely in the near
future.
THE
BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” APPROVAL OF THE
AMENDMENT TO OUR CERTIFICATE OF INCORPORATION TO ELIMINATE
REFERENCE TO THE CLASSIFICATION OF THE BOARD OF DIRECTORS INTO
CLASSES WITH STAGGERED TERMS.
PROPOSAL
6 – NON-BINDING ADVISORY VOTE ON EXECUTIVE
COMPENSATION
The
SEC’s proxy rules provide that not less than once every three
years, all companies subject to the Securities Exchange Act of 1934
(the “Exchange Act”) must include a separate resolution subject to
stockholder vote to approve the compensation of the company’s named
executive officers, as disclosed in the proxy statement. This vote,
commonly known as a “say-on-pay” vote, gives a company’s
stockholders the opportunity to endorse or not endorse the
company’s executive pay program and policies. We are asking
stockholders to approve the following resolution:
“RESOLVED,
that the compensation paid to GulfSlope Energy, Inc.’s named
executive officers, as disclosed in this proxy statement pursuant
to Item 402 of Regulation S–K, including the Compensation
Discussion, compensation tables and narrative discussion, is hereby
APPROVED.”
As
provided in Section 14A of the Exchange Act, this vote will not be
binding on us or our board of directors and may not be construed as
overruling a decision by the board, creating or implying any change
to the fiduciary duties of the board or any additional fiduciary
duty by the board or restricting or limiting the ability of
stockholders to make proposals for inclusion in proxy materials
related to executive compensation. The Compensation Committee may,
however, take into account the outcome of the vote when considering
future executive compensation arrangements.
This
Annual Meeting will be the first stockholders meeting where we
include a say-on-pay vote.
In
voting to approve the above resolution, stockholders may vote for
the resolution, against the resolution or abstain from voting. This
matter will be decided by the affirmative vote of a majority of the
votes cast at the Annual Meeting. On this matter, abstentions and
broker non-votes will have no effect on the voting.
OUR
BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RESOLUTION TO APPROVE
THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS AS DISCLOSED IN
THIS PROXY STATEMENT.
PROPOSAL
7 – NON-BINDING ADVISORY VOTE ON THE FREQUENCY OF VOTES
ON
EXECUTIVE
COMPENSATION
As
required by the SEC’s proxy rules, we are seeking an advisory,
non-binding stockholder vote about how often we should present
stockholders with the opportunity to vote on compensation awarded
to our named executive officers. You may elect to have the
say-on-pay vote held every year, every two years, or every three
years, or you may abstain.
As
provided in Section 14A of the Exchange Act, this vote will not be
binding on us or the board of directors and may not be construed as
overruling a decision by the Board, creating or implying any change
to the fiduciary duties of the Board or any additional fiduciary
duty by the Board or restricting or limiting the ability of
stockholders to make proposals for inclusion in proxy materials
related to executive compensation.
The
board of directors recommends that say-on-pay votes be held once
every three years, but stockholders are not voting to approve or
disapprove of that recommendation. We believe that a three-year
voting frequency will provide our stockholders with sufficient time
to evaluate the effectiveness of our overall compensation
philosophy, policies, and practices in the context of our long-term
business results for the corresponding period, while avoiding
over-emphasis on short-term variations in compensation and business
results. We also believe that a three-year timeframe provides a
better opportunity to observe and evaluate the impact of any
changes to our executive compensation policies and practices that
have occurred since the last advisory vote.
This
Annual Meeting is the first stockholder meeting where we have
included a vote on the frequency of say-on-pay votes. The next
stockholder advisory vote on the frequency of say-on-pay votes will
occur at our Annual Meeting held in 2028.
The
frequency that receives the highest number of votes cast will be
deemed to be the frequency selected by the stockholders. Because
this vote is advisory, it will not be binding upon our board of
directors. The board of directors will, however, consider the
outcome of the stockholder vote, along with other relevant factors,
in determining the voting frequency.
OUR
BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE TO HAVE THE
NON-BINDING VOTE ON EXECUTIVE COMPENSATION EVERY THREE
YEARS.
INTERESTS
OF CERTAIN PERSONS IN OPPOSITION TO
MATTERS TO BE ACTED UPON
None
of the persons who have served as our executive officers or
directors since the beginning of our last fiscal year, or any
associates of such persons, have any substantial interest, direct
or indirect, in any of the proposals set forth herein, other than
elections to office.
OTHER
MATTERS WHICH MAY BE PRESENTED FOR ACTION AT THE
MEETING
The
board of directors does not intend to present for action at this
Annual Meeting any matter other than those specifically set forth
in the Notice of Annual Meeting. If any other matter is properly
presented for action at the Annual Meeting, it is the intention of
persons named in the proxy to vote thereon in accordance with their
judgment pursuant to the discretionary authority conferred by the
proxy.
PROPOSALS
FOR NEXT ANNUAL MEETING
Under
the SEC’s proxy rules, stockholder proposals that meet specified
conditions must be included in our proxy statement and proxy for
the 2023 annual meeting. Under Exchange Act Rules 14a-5(e) and
14a-8(e), stockholders that intend to present a proposal at our
2023 annual meeting must give us written notice of the proposal not
later than [•] [•], 2023 for the proposal to be considered for
inclusion in our proxy materials for that meeting. Our timely
receipt of a proposal by a qualified stockholder will not guarantee
the proposal’s inclusion in our proxy materials or presentation at
the 2023 annual meeting, because there are other requirements in
the proxy rules. We reserve the right to reject, rule out of order,
or take other appropriate action with respect to any proposal that
does not comply with all applicable requirements of the SEC’s proxy
rules, state law, and our bylaws.
Delivery of Documents to Stockholders Sharing an
Address
Some
banks, brokers and other nominee record holders may be
participating in the practice of “householding” proxy statements,
information statements and annual reports. This means that only one
copy of this proxy statement may have been sent to multiple
stockholders in your household. We will promptly deliver a separate
copy of this document to you if you call or write us at the
following address or phone number: 1000 Main Street, Suite 2300,
Houston, Texas 77002, (281) 918-4100. If you want to receive
separate copies of our proxy statements, information statements and
annual reports in the future, or if you are receiving multiple
copies and would like to receive only one copy for your household,
you should contact your bank, broker, or other nominee record
holder, or you may contact us at the above address and phone
number.
Where you can Find Additional Information
The
Company is subject to the informational filing requirements of the
Exchange Act and, in accordance therewith, is required to file
periodic reports, proxy statements and other information with the
SEC relating to its business, financial condition and other
matters. Such reports, proxy statements and other information can
be inspected and copied at the public reference facility maintained
by the SEC at 100 F Street, N.E., Washington, D.C. 20549-0213.
Information regarding the public reference facilities may be
obtained from the SEC by telephoning 1-800-SEC-0330. The Company’s
filings are also available to the public on the SEC’s website
(www.sec.gov). Copies of such materials may also be obtained by
mail from the Office of Investor Education and Advocacy of the SEC
at 100 F Street, N.E., Washington, D.C. 20549 at prescribed rates.
We maintain a website at https://www.gulfslope.com. You may access
our annual reports on Form 10-K, quarterly reports on Form 10-Q,
current reports on Form 8-K and amendments to those reports filed
or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act
with the SEC free of charge at our website as soon as reasonably
practicable after such material is electronically filed with, or
furnished to the SEC.
|
By
Order of the Board of Directors, |
|
|
|
John
N. Seitz |
Dated:
August [•], 2022 |
Chief
Executive Officer and Chairman of the Board |
Exhibit A
STATE
OF DELAWARE
CERTIFICATE
OF AMENDMENT TO
AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION OF
GULFSLOPE
ENERGY, INC.
The
corporation organized and existing under and by virtue of the
General Corporation Law of the State of Delaware does hereby
certify:
FIRST:
That at a meeting of the Board of Directors of GulfSlope Energy,
Inc., resolutions were duly adopted setting forth a proposed
amendment to the certificate of incorporation, as amended, of said
corporation (the “Certificate of Incorporation”), subject to
the approval for such amendment, by the stockholders of the
corporation.
The
resolution setting forth the proposed amendment is as
follows:
RESOLVED,
that the Certificate of Incorporation of this corporation be
amended by amending and restating the first paragraph of the
article named “ARTICLE 4” as follows:
“The
total number of shares of capital stock that the Corporation shall
have authority to issue is 3,050,000,000, consisting of
3,000,000,000 shares of common stock, par value $0.001 per share
(the “Common Stock”), and 50,000,000 shares of preferred
stock, par value $0.001 per share (the “Preferred
Stock”).”
SECOND:
That thereafter, pursuant to resolution of its Board of Directors,
an annual meeting of the stockholders of said corporation was duly
called and held upon notice in accordance with Section 222 of the
General Corporation Law of the State of Delaware at which meeting
the necessary number of shares as required by statute were voted in
favor of the amendment.
THIRD:
That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the
State of Delaware.
I,
the undersigned, as the Chief Executive Officer of the Corporation,
have signed this Certificate of Amendment to Certificate of
Incorporation on [ ].
|
|
|
John
N. Seitz |
|
Chief
Executive Officer |
A-1
Exhibit B
STATE
OF DELAWARE
CERTIFICATE
OF AMENDMENT TO
AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION OF
GULFSLOPE
ENERGY, INC.
The
corporation organized and existing under and by virtue of the
General Corporation Law of the State of Delaware does hereby
certify:
FIRST:
That at a meeting of the Board of Directors of GulfSlope Energy,
Inc., resolutions were duly adopted setting forth a proposed
amendment to the certificate of incorporation, as amended, of said
corporation (the “Certificate of Incorporation”), subject to
the approval for such amendment, by the stockholders of the
corporation.
The
resolution setting forth the proposed amendment is as
follows:
RESOLVED,
that the Certificate of Incorporation of this corporation be
amended by adding the below paragraph to the end of the article
named “ARTICLE 4” as follows:
“Reverse
Stock Split of Outstanding Common Stock
Effective
as of the effective date of such Amendment as set forth below (the
“Effective Time”), every [2 to 200, depending on the
final ratio approved by the Board of Directors] shares of the
Corporation’s Common Stock, issued and outstanding immediately
prior to the Effective Time, or held in treasury prior to the
Effective Time (collectively the “Old Capital Stock”), shall
be automatically reclassified and combined into 1 share of Common
Stock (the “Reverse Stock Split”). Any stock certificate
that, immediately prior to the Effective Time, represented shares
of Old Capital Stock will, from and after the Effective Time,
automatically and without the necessity of presenting the same for
exchange, represent the number of shares as equals the quotient
obtained by dividing the number of shares of Old Capital Stock
represented by such certificate immediately prior to the Effective
Time by [2 to 200, depending on the final ratio approved by the
Board of Directors], subject to any adjustments for fractional
shares as set forth below; provided, however, that each person
holding of record a stock certificate or certificates that
represented shares of Old Capital Stock shall receive, upon
surrender of such certificate or certificates, a new certificate or
certificates evidencing and representing the number of shares of
capital stock to which such person is entitled under the foregoing
reclassification. No fractional shares of capital stock shall be
issued as a result of the Reverse Stock Split. In lieu of any
fractional share of capital stock to which a stockholder would
otherwise be entitled, the Corporation shall issue that number of
shares of capital stock as rounded up to the nearest whole share.
The Reverse Stock Split shall have no effect on the number of
authorized shares of capital stock, previously designated series of
preferred stock or the par value thereof as set forth above in the
preceding paragraphs.”
SECOND:
That thereafter, pursuant to resolution of its Board of Directors,
an annual meeting of the stockholders of said corporation was duly
called and held upon notice in accordance with Section 222 of the
General Corporation Law of the State of Delaware at which meeting
the necessary number of shares as required by statute were voted in
favor of the amendment.
THIRD:
That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the
State of Delaware.
FOURTH:
That said amendment shall be effective for all purposes as of
[____________].
I,
the undersigned, as the Chief Executive Officer of the Corporation,
have signed this Certificate of Amendment to Certificate of
Incorporation on [ ].
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John
N. Seitz |
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Chief
Executive Officer |
B-1
Exhibit C
STATE
OF DELAWARE
CERTIFICATE
OF AMENDMENT TO
AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION OF
GULFSLOPE
ENERGY, INC.
The
corporation organized and existing under and by virtue of the
General Corporation Law of the State of Delaware does hereby
certify:
FIRST:
That at a meeting of the Board of Directors of GulfSlope Energy,
Inc., resolutions were duly adopted setting forth a proposed
amendment to the certificate of incorporation, as amended, of said
corporation (the “Certificate of Incorporation”), subject to
the approval for such amendment, by the stockholders of the
corporation.
The
resolution setting forth the proposed amendment is as
follows:
RESOLVED,
that the Certificate of Incorporation of this corporation be
amended by amending and restating the article named “ARTICLE 6” as
follows:
“ARTICLE
6
The
affairs of the Corporation shall be governed by a Board of
Directors. The number of directors of the Corporation shall be
determined in the manner set forth in the Bylaws of the
Corporation.”
SECOND:
That thereafter, pursuant to resolution of its Board of Directors,
an annual meeting of the stockholders of said corporation was duly
called and held upon notice in accordance with Section 222 of the
General Corporation Law of the State of Delaware at which meeting
the necessary number of shares as required by statute were voted in
favor of the amendment.
THIRD:
That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the
State of Delaware.
I,
the undersigned, as the Chief Executive Officer of the Corporation,
have signed this Certificate of Amendment to Certificate of
Incorporation on [ ].
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John
N. Seitz |
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Chief
Executive Officer |
C-1
PROXY
GULFSLOPE
ENERGY, INC.
THIS
PROXY IS SOLICITED ON BEHALF OF THE
BOARD
OF DIRECTORS FOR THE
ANNUAL
MEETING OF STOCKHOLDERS
TO
BE HELD ON SEPTEMBER 30, 2022
The
undersigned hereby appoints John N. Seitz and John H. Malanga, and
each of them as the true and lawful attorney, agent and proxy of
the undersigned, with full power of substitution, to represent and
to vote all shares of common stock of GulfSlope Energy, Inc. (the
“Company”) held of record by the undersigned on August 12, 2022, at
the Annual Meeting of Stockholders to be held on September 30,
2022, at 10:00 a.m. (Central Time) at 1000 Main Street, Suite 2300,
Houston, Texas 77002, and at any adjournments thereof. Any and all
other proxies heretofore given are hereby revoked.
WHEN
PROPERLY EXECUTED, THIS PROXY WILL BE VOTED AS DESIGNATED BY THE
UNDERSIGNED. IF NO CHOICE
IS SPECIFIED, THE PROXY WILL BE VOTED FOR THE NOMINEES
LISTED IN NUMBER 1, FOR THE RATIFICATION IN NUMBER 2,
for the amendment to our certificate of incorporation IN
NUMBER 3, for the authorization to effect a reverse stock
split IN NUMBER 4, for the amendment to our certificate of
incorporation IN NUMBER 5, for the non-binding resolution in
NUMBER 6, FOR THE THREE YEAR OPTION IN NUMBER 7, and
FOR THE APPROVAL IN NUMBER 8.
1.
ELECTION OF DIRECTORS OF THE COMPANY. (INSTRUCTION: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A LINE
THROUGH, OR OTHERWISE STRIKE, THAT NOMINEE’S NAME IN THE LIST
BELOW.)
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☐ |
FOR
all nominees listed |
☐ |
WITHHOLD
authority to |
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below
except as marked |
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vote
for all nominees |
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to
the contrary. |
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below. |
John
N. Seitz
Paul
L. Morris
Richard
S. Langdon
2.
PROPOSAL TO RATIFY THE
SELECTION OF Pannell Kerr Forster of Texas, P.C. AS THE COMPANY’S
independent registered public accounting firm FOR THE FISCAL YEAR
ENDING SEPTEMBER 30, 2022.
☐ FOR ☐
AGAINST ☐ ABSTAIN
3. PROPOSAL TO approve the filing of an amendment to the Company’s
certificate of incorporation to increase the number of authorized
shares of common stock from 1,500,000,000 to
3,000,000,000.
☐ FOR ☐
AGAINST
☐
ABSTAIN
4. PROPOSAL TO authorize the board of directors, without further
stockholder approval, to effect a reverse stock split of all the
Company’s outstanding common stock, by the filing of a certificate
of amendment to the certificate of incorporation, in a ratio of
between one-for-two and one-for-200, with the board of directors
having the discretion as to whether or not the reverse split is to
be effected, and with the exact exchange ratio of any reverse split
to be set at a whole number within the above range as determined by
the board of directors in its sole discretion, at any time before
the earlier of (a) SEPTEMBER
30, 2023; and (b) the date
of our next annual meeting of stockholders.
☐ FOR ☐
AGAINST
☐
ABSTAIN
5. PROPOSAL TO approve the filing of an amendment to the COMPANY’s
certificate of incorporation to ELIMINATE REFERENCE TO THE
CLASSIFICATION OF THE BOARD OF DIRECTORS INTO CLASSES WITH
STAGGERED TERMS.
☐ FOR ☐
AGAINST
☐
ABSTAIN
6. PROPOSAL TO approve a non-binding advisory resolution on
executive compensation.
☐ FOR ☐
AGAINST
☐
ABSTAIN
7. PROPOSAL TO APPROVE, ON AN ADVISORY BASIS, WHETHER THE
NON-BINDING ADVISORY VOTES ON EXECUTIVE COMPENSATION SHOULD OCCUR
EVERY ONE, TWO, OR THREE YEARS.
☐ THREE YEARS
☐ TWO
YEARS
☐ ONE YEAR
☐
ABSTAIN
8. IN HIS DISCRETION, THE PROXY IS AUTHORIZED TO VOTE UPON SUCH
OTHER BUSINESS THAT MAY PROPERLY COME BEFORE THE ANNUAL
MEETING.
☐ FOR
☐ AGAINST
☐
ABSTAIN
Please
sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, as executor,
administrator, trustee or guardian, please give full title as such.
If a partnership, please sign in partnership name by authorized
person. If a corporation or other business entity, please sign in
full corporate name by President or other authorized
officer.
NUMBER
OF |
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SIGNATURE:
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SHARES
OWNED |
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PRINTED
NAME:
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DATE:
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THIS
PROXY MAY BE REVOKED AT ANY TIME BEFORE IT IS VOTED AT THE MEETING.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY
PROMPTLY.
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Important
Notice Regarding the Availability of Proxy Materials for the Annual
Meeting of Stockholders to be held September 30,
2022. |
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The
proxy statement, form of proxy card and annual report are available
at:
www.gulfslope.com
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