Item 1.01. Entry into a Material Definitive Agreement.
On May 9, 2019, Houston American Energy Corp. (the "Company") entered into an
At-the-Market Issuance Sales Agreement (the "Sales Agreement") with WestPark
Capital, Inc. ("WestPark Capital") pursuant to which the Company may sell, at
its option, up to an aggregate of $5.2 million in shares of its common stock,
par value $0.001 per share (the "Shares") through WestPark Capital, as sales
agent. Sales of the Shares made pursuant to the Sales Agreement, if any, will be
made under the Company's previously filed and currently effective shelf
Registration Statement on Form S-3 (Registration No. 333-228749) (the
"Registration Statement"). Prior to any sales under the Sales Agreement, the
Company will deliver a placement notice to WestPark Capital that will set the
parameters for such sale of Shares, including the number of Shares to be issued,
the time period during which sales are requested to be made, any limitation on
the number of Shares that may be sold in any one trading day and any minimum
price below which sales may not be made.
Subject to the terms and conditions of the Sales Agreement, WestPark Capital may
sell the Shares, if any, only by methods deemed to be an "at the market"
offering as defined in Rule 415 promulgated under the Securities Act of 1933, as
amended (the "Securities Act"), including, without limitation, sales made
directly through the NYSE American or any other trading market on which the
Company's common stock is listed or quoted or to or through a market maker. In
addition, subject to the terms and conditions of the Sales Agreement, with the
Company's prior written consent, WestPark Capital may also sell Shares by any
other method permitted by law, or as may be required by the rules and
regulations of the NYSE American or such other trading market on which the
Company's common stock is listed or quoted, including, but not limited to, in
negotiated transactions. WestPark Capital will use commercially reasonable
efforts consistent with its normal trading and sales practices to sell the
Shares in accordance with the terms of the Sales Agreement and any applicable
placement notice. The Company cannot provide any assurances that WestPark
Capital will sell any Shares pursuant to the Sales Agreement.
The Company made certain customary representations, warranties and covenants
concerning the Company and the offering of the Shares. Pursuant to the terms of
the Sales Agreement, the Company also provided WestPark Capital with customary
indemnification rights, including indemnification against certain liabilities
under the Securities Act. The Company will pay WestPark Capital a commission in
cash equal to 3% of the gross proceeds from the sale of the Shares under the
Sales Agreement, if any. In addition, the Company has agreed to reimburse
WestPark Capital for its reasonable documented out-of-pocket expenses incurred
in connection with the negotiation and execution of the Sales Agreement up to a
maximum amount of $18,000. The offering of Shares will terminate upon the
earlier of (a) the second (2nd) year anniversary of the date of the Sales
Agreement, (b) the sale of all of the Shares subject to the Sales Agreement and
(c) the termination of the Sales Agreement by the Company or WestPark Capital.
Either party may terminate the Sales Agreement in its sole discretion at any
time upon written notice to the other party.
A copy of the Sales Agreement is filed as Exhibit 1.1 hereto. The foregoing
description of the material terms of the Sales Agreement does not purport to be
complete and is qualified in its entirety by reference to such Exhibit 1.1.
The legal opinion of Michael W. Sanders relating to the legality of the issuance
and sale of the Shares is attached as Exhibit 5.1 hereto.
This Current Report on Form 8-K shall not constitute an offer to sell or a
solicitation of an offer to buy any securities, nor shall there be any sale of
these securities in any state or jurisdiction in which such an offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any state or other jurisdiction.
Item 8.01. Other Events.
The information set forth in Item 1.01 with respect to the Sales Agreement is
hereby incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
Exhibit No. Description
1.1 At-the-Market Issuance Sales Agreement, dated May 9, 2019, by and
between Houston American Energy Corp. and WestPark Capital, Inc.
5.1 Opinion of Michael W. Sanders, Attorney at Law
23.1 Consent of Michael W. Sanders, Attorney at Law (included in
© Edgar Online, source Glimpses