AMENDED AND RESTATED STOCK OPTION PLAN
OF
GMX RESOURCES INC.
(As amended effective May 22, 2007 to increase number of
shares to 850,000)
1. Purpose of the Plan
This Amended
and Restated Stock Option Plan (the “Plan”) is intended
as an incentive to managerial and other key employees of GMX
RESOURCES INC. (the “Company”), and its
subsidiaries. Its purposes are to retain employees with a high
degree of training, experience, and ability, to attract new
employees whose services are considered unusually valuable, to
encourage the sense of proprietorship of such persons, and to
stimulate the active interest of such persons in the development
and financial success of the Company. Options granted under the
Plan may be either “incentive stock options” as
provided by Section 422 of the Internal Revenue Code of 1986,
as amended, and as may be further amended from time to time ( the
“Internal Revenue Code” or “Code”) or
options which do not qualify as incentive stock options.
2. Administration of the Plan
(a)
Administration . The Plan shall be administered by the Board
of Directors of the Company, or if the Board so authorizes, by a
committee (the “Committee”) of the Board of Directors
consisting of not less than two (2) members of the Board of
Directors. Unless the context otherwise requires, references herein
to the Committee shall be references to the Board of Directors or
the Committee. Members of the Committee shall serve at the pleasure
of the Board, and the Board may from time to time remove members
from, or add members to, the Committee. A majority of the members
of the Committee shall constitute a quorum for the transaction of
business. Action approved in writing by a majority of the members
of the Committee then serving shall be fully effective as if the
action had been taken by unanimous vote at a meeting duly called
and held.
(b)
Authority . The Committee is authorized to construe and
interpret the Plan, to promulgate, amend and rescind rules and
regulations relating to the implementation of the Plan and to make
all other determinations necessary or advisable for the
administration of the Plan. The Committee may designate persons
other than members of the Committee to carry out its
responsibilities under such conditions and limitations as it may
prescribe, except that the Committee may not delegate its authority
with regard to selection for participation of, and the granting of
options to, persons subject to Sections 16(a) and 16(b) of the
Exchange Act. Any determination, decision or action of the
Committee in connection with the construction, interpretation,
administration, or application of the Plan shall be final,
conclusive and binding upon all persons participating in the Plan
and any person validly claiming under or through persons
participating in the Plan. The Company shall effect the granting of
options under the Plan in accordance with the determinations made
by the Committee, by execution of instruments in writing in such
form as approved by the Committee.
3. Designation of Participants
Persons
eligible for options under the Plan shall consist of managerial and
other key employees of the Company and/or its subsidiaries who hold
positions of significant responsibilities or whose performance or
potential contribution, in the sole judgment of the Committee, will
benefit the future success of the Company. In addition, all
Non-employee Directors of the Company shall be eligible for options
under the plan in accordance solely with the provisions of
Section 7 hereof.
4. Shares Subject to the Plan
Subject to
adjustment as provided in Section 9 hereof, there shall be
subject to the Plan eight hundred fifty thousand (850,000) shares
of common stock subject of the Company, par value $0.001 per share.
The shares subject to the Plan shall consist of authorized but
unissued shares or treasury shares held by the Company. Any of such
shares that may remain unsold and that are not subject to
outstanding options at the termination of the Plan shall cease to
be subject to the Plan, but until termination of the Plan, the
Company shall at all times make available a sufficient number of
shares to meet the requirements of the Plan. Should any option
expire or be canceled prior to its exercise in full, or a portion
of an option is surrendered in payment for the exercise of an
option or satisfaction of any tax withholding obligations, the
shares theretofore subject to such options may again be subjected
to an option under the Plan. Any shares not subject to outstanding
options at the expiration of the Plan or at any time during the
life of the Plan may be dedicated to other plans that the Company
may adopt and to the extent so dedicated, such shares shall not be
subject to this Plan.
5. Option Price
(a)
Price . The purchase price for each share placed under
option pursuant to the Plan shall be determined by the Committee,
but shall in no event be less than 100% of the Fair Market Value
(as defined below) of such share on the date the option is
granted.
(b)
Fair Market Value . “Fair Market Value” means
the average of the high and low sales prices of the shares of
Common Stock on any national securities exchange on which the
shares are listed on the day on which such value is to be
determined or, if no shares were traded on such day, on the next
preceding day on which shares were traded, as reported by such
exchange, by National Quotation Bureau, Inc. or other national
quotation service. If the Common Stock is not listed on a national
securities exchange, Fair Market Value means the average of the
closing “bid” and “asked” prices of the
shares of Common Stock in the over-the-counter market on the date
on which such value is to be determined or, if such prices are not
available, the last sales price on such day or, if no shares were
traded on such day, on the next preceding day on which the shares
were traded, as reported by the National Association of Securities
Dealers Automatic Quotation System (NASDAQ) or other national
quotation service. If at any time shares of Common Stock are not
traded on an exchange or in the over-the-counter market, Fair
Market Value shall be the value determined by the Committee, taking
into consideration those factors affecting or reflecting value that
they deem appropriate. For purposes of determining the purchase
price of an incentive stock option, Fair Market Value shall in any
event be determined in accordance with Section 422 of the
Code.
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6. Terms and Exercise of Options
(a)
General . The Committee, in granting options hereunder,
shall have discretion to determine the times when, and the terms
upon which, options shall be exercisable, including such provisions
as deemed advisable to permit qualification as “incentive
stock options” within the meaning of Section 422 of the
Internal Revenue Code, as the same may from time to time be amended
for options intended to qualify as such, and incentive stock
options outstanding under the Plan may be amended, if necessary, to
permit such qualification. The Committee shall designate at the
time of granting of any option whether such option or any portion
thereof shall be an “incentive stock option.” Each
option shall be evidenced by an agreement between the Company and
the optionee containing provisions consistent with this Plan and
such other provisions as the Committee may determine as provided
herein. Unless otherwise determined by the Committee at the time of
grant, all options shall become exercisable at the rate of 25% of
the total shares subject to the option on each of the first four
(4) anniversary dates of the date of grant. The Committee
shall also be entitled to accelerate the date any outstanding
option becomes exercisable at any time.
(b)
Term . In the event of the death of an optionee while in the
employ of the Company, any unvested portion of the option as of the
date of death shall be vested as of the date of death and the
option shall be exercisable in full by the heirs or other legal
representatives of the optionee within twelve (12) months
following the date of death. In the event of termination of
employment for any reason other than death or termination for cause
(and except as otherwise provided in subsection (e) below)
such option shall be exercisable by the employee or his legal
representative within three (3) months of the date of
termination as to all then vested portions. In addition, the
Committee may in its sole discretion, approve acceleration of the
vesting of any unvested portions of the option. If an
optionee’s employment with the Company is terminated for
cause, the option shall terminate as of the date of such
termination of employment and the optionee shall have no further
rights to exercise any portion of the option. “Termination
for cause” means any discharge for violation of the policies
and procedures of the Company or for other job performance or
conduct that is detrimental to the best interests of the Company,
as determined by the Committee in its sole discretion.
Notwithstanding any of the foregoing, in no event may an option be
exercised more than ten (10) years after the date of its
grant.
(c)
Method of Exercise . Options may be exercised, whether in
whole or in part, by written notification to the Company
accompanied by cash or a certified check for the aggregate purchase
price of the number of shares being purchased, or upon exercise of
an option, the optionee shall be entitled (unless otherwise
provided in the agreement evidencing the option), without the
requirement of further approval or other action by the Committee,
to pay for the shares (i) by tendering stock of the Company
that has been owned by the optionee for at least six
(6) months with such stock to be valued at the Fair Market
Value (as determined under Section 5) on the date immediately
preceding the date of exercise or (ii) with a combination of
cash and stock that has been owned by the optionee for at least six
(6) months as provided above.
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In addition,
upon exercise of an option, the optionee may, with the prior
approval of the Committee, pay for the shares (a) by tendering
stock of the Company already owned by the optionee but that has not
been held by the optionee for at least six (6) months with
such stock to be valued at the Fair Market Value (as determined
under Section 5) on the date immediately preceding the date of
exercise, (b) surrendering a portion of the option with such
surrendered option to be valued based on the difference between the
Fair Market Value (as determined under Section 5) of the
shares surrendered on the date immediately preceding the date of
exercise and the aggregate option purchase price of the shares
surrendered (“Surrender Value”), or (c) with a
combination of cash, stock of the Company that has not been held by
the optionee for at least six (6) months or surrender of
options.
The Committee
may also permit optionees, either on a selective or aggregate
basis, to simultaneously exercise options and sell the shares of
common stock thereby acquired, pursuant to a brokerage or similar
arrangement, approved in advanced by the Committee, and use the
proceeds from such sale as payment of the purchase price of the
shares being acquired upon exercise of any option.
(d)
Limitations Applicable To In
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