AMENDMENT NO. 1
TO
PROPERTY PURCHASE AGREEMENT
THIS AMENDMENT NO. 1 dated as of August 9, 2002 (this "Amendment") is made to
the PROPERTY PURCHASE AGREEMENT (the "Agreement") dated as of April 23, 2002, by
and between Gasco Energy, Inc. ("Gasco"), a Nevada corporation whose address is
00 Xxxxxxxxx Xxxxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000, and Shama Zoe
Limited Partnership ("Shama Zoe"), a Colorado limited partnership whose address
is 0000 Xxxxx Xxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxx 00000. Each capitalized term used
but not otherwise defined herein shall have the meaning assigned to such term in
the Agreement.
W I T N E S S E T H:
WHEREAS, Gasco desires to issue and sell shares of Gasco Stock, subject to
registration rights, for an aggregate price of up to $10,000,000 in a private
offering (the "Private Offering"); and
WHEREAS, Sections 2.5 and 2.6 of the Agreement requires the prior written
approval of the general partner of Shama Zoe in order for Gasco to consummate
the Private Offering; and
WHEREAS, Shama Zoe desires to grant such approval to Gasco subject to the
terms set forth in this Amendment;
NOW, THEREFORE, in consideration of the premises, the parties hereto agree
as follows:
1. Notwithstanding the provisions of Sections 2.5 and 2.6 of the Agreement,
Shama Zoe hereby agrees that Gasco may issue the shares of Gasco Stock for an
aggregate price of up to $10,000,000 (and for a price per share less than $1.80)
in connection with the Private Offering, such shares being subject to
registration rights. Notwithstanding the foregoing, Sections 2.5 and 2.6 of the
Agreement shall remain in full force and effect in all other respects.
2. Gasco hereby grants to Shama Zoe an option, exercisable at any time
after the date hereof and until December 31, 2002, to sell up to 1,400,000 of
its Gasco Shares to Gasco for a price of $1.00 per share. Shama Xxx xxx exercise
this option by written notice to Gasco delivered at least two (2) days prior to
the effective time of such purchase and sale, such effective time to be no later
than December 31, 2002. In the event Shama Zoe sells any Gasco Shares to any
third party prior to December 31, 2002, the number of shares subject to this
option shall be reduced by the dollar amount of net proceeds received by Shama
Zoe from each such sale, each such reduction to be effective as of the date of
the corresponding sale.
3. Section 2.2(a) of the Agreement is hereby amended to read in its
entirety as follows:
"(a) Within 30 days after the closing date of the Private Offering, the
Company shall use its commercially reasonable efforts to prepare and
file with the Securities and Exchange Commission (the "SEC"), a
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registration statement covering resales of the Gasco Shares and the
shares issued in the Private Offering and such other documents as may
be necessary in the opinion of counsel for the Company, and use its
commercially reasonable efforts to have such registration statement
declared effective by November 1, 2002 in order to comply with the
provisions of the Securities Act of 1933, as amended (the "Securities
Act"). The Company will include in such registration statement the
information required under the Securities Act to be so included
concerning Shama Zoe, as provided by Shama Zoe, including any changes
in such information that may be provided by Shama Zoe in writing to
the Company from time to time. If the registration statement referred
to above has not been declared effective by the SEC by November 1,
2002 and the cause of the delay is not related to circumstances beyond
the Company's control (such as failure of the SEC to review and act on
the registration statement or amendments to the registration statement
in a timely manner), the Company shall pay liquidated damages of $.02
per share for every Gasco Share for each 30 day period of delay
following November 1, 2002 ("Liquidated Damages"); provided, however,
that if the period of such delay is less than 30 days, the total
Liquidated Damages payable shall be equal to the amount payable for a
30-day delay multiplied by a fraction equal to the actual number of
days of delay divided by 30. The foregoing payment shall constitute
the sole monetary remedy available to Shama Zoe in the event that the
Company does not comply with the deadlines set forth in this Section
2.2(a) with respect to the filing and effectiveness of such
registration statement."
4. As amended hereby, the Agreement is in all respects ratified, confirmed
and approved and shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first set forth above.
SHAMA ZOE LIMITED PARTNERSHIP GASCO ENERGY, INC.
By: /s/ Xxxxxx Xxxx By: /s/ Xxxx X. Xxxxxxxx
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Xxxxxx Xxxx, General Partner Xxxx X. Xxxxxxxx, President
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