Exhibit 10.1

 

INCENTIVE STOCK OPTION AGREEMENT

 

AGREEMENT made this                     , between GOODRICH PETROLEUM
CORPORATION, a Delaware corporation (the “Company”), and                     
(“Employee”).

 

To carry out the purposes of the GOODRICH PETROLEUM CORPORATION 1995 STOCK
OPTION PLAN (the “Plan”), by affording Employee the opportunity to purchase
shares of the common stock of the Company (“Stock”), and in consideration of the
mutual agreements and other matters set forth herein and in the Plan, the
Company and Employee hereby agree as follows:

 

1. Grant of Option. The Company hereby irrevocably grants to Employee the right
and option (“Option”) to purchase all or any part of an aggregate of
                     shares of Stock, on the terms and conditions set forth
herein and in the Plan, which Plan is incorporated herein by reference as a part
of this Agreement. Exercise of the Option is subject to, and contingent upon,
approval of the Plan by the stockholders of the Company on or before 12 months
after the date the Plan was adopted by the Board of Directors of the Company.
This Option is intended to constitute an incentive stock option, within the
meaning of section 422(b) of the Internal Revenue Code of 1986, as amended (the
“Code”).

 

2. Purchase Price. The purchase price of Stock purchased pursuant to the
exercise of this Option shall be $             per share, which has been
determined to be not less than the fair market value of the Stock at the date of
grant of this Option. For all purposes of this Agreement, fair market value of
Stock shall be determined in accordance with the provisions of the Plan.

 

3. Exercise of Option. Subject to the earlier expiration of this Option as
herein provided, this Option may be exercised, by written notice to the Company
at its principal executive office addressed to the attention of its Chief
Executive Officer at any time and from time to time after the date of grant
hereof, but, except as otherwise provided below, this Option shall not be
exercisable for more than a percentage of the aggregate number of shares offered
by this Option determined by the number of full years from the date of grant
hereof to the date of such exercise, in accordance with the following schedule:

 

Number of Full Years

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   Percentage of Shares
That May Be Purchased

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Less than 1 year

          0%

1 year

   33.33%

2 years

   66.67%

3 years

      100%

 

This Option may be exercised only while Employee remains an employee of the
Company and will terminate and cease to be exercisable upon Employees’
termination of employment with the Company, except that:

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(a) If Employee’s employment with the Company terminates by reason of disability
(within the meaning of section 22 (e)(3) of the Code), this Option may be
exercised in full by Employee (or Employee’s estate or the person who acquires
this Option by will or the laws of descent and distribution or otherwise by
reason of the death of Employee) at any time during the period of one year
following such termination.

 

(b) If Employee dies while in the employ of the Company, Employee’s estate, or
the person who acquires this Option by will or the laws of descent and
distribution or otherwise by reason of the death of Employee, may exercise this
Option in full at any time during the period of one year following the date of
Employee’s death.

 

(c) If Employee’s employment with the Company terminates for any reason other
than as described in (a) or (b) above, unless Employee voluntarily terminates
such employment or such employment is terminated for cause, this Option may be
exercised by Employee at any time during the period of three months following
such termination, or by Employee’s estate (or the person who acquires this
Option by will or the laws of descent and distribution or otherwise by reason of
the death of Employee) during a period of one year following Employee’s death if
Employee dies during such three-month period, but in each case only as to the
number of shares Employee was entitled to purchase hereunder as of the date
Employee’s employment so terminates. The Committee appointed by the Board of
Directors of the Company to administer the Plan (the “Committee”) may, in its
sole discretion, advise Employee in writing, prior to a voluntary termination of
Employee’s employment, that such termination will be treated for purposes of
this paragraph as an involuntary termination for a reason other than cause. As
used in this paragraph, the term “cause” shall mean Employee’s gross negligence
or willful misconduct in performance of the duties of his employment, or
Employee’s final conviction of a felony or of a misdemeanor involving moral
turpitude.

 

This Option shall not be exercisable in any event after the expiration of ten
years from the date of grant hereof. The purchase price of shares as to which
this Option is exercised shall be paid in full at the time of exercise (a) in
cash (including check, bank draft or money order payable to the order of the
Company), or (b) by delivering to the Company shares of Stock having a fair
market value equal to the purchase price, or (c) a combination of cash and
Stock. No fraction of a share of Stock shall be issued by the Company upon
exercise of any Option or accepted by the Company in payment of the exercise
price therefore; rather, Employee shall provide a cash payment for such amount
as is necessary to effect the issuance and acceptance of only whole shares of
Stock. Unless and until a certificate or certificates representing such shares
shall have been issued by the Company to Employee, Employee (or the person
permitted to exercise this Option in the event of the Employee’s death) shall
not be or have any of the rights or privileges of a shareholder of the Company
with respect to shares acquirable upon an exercise of this Option.

 

4. Withholding of Tax. To the extent that the exercise of this Option or the
disposition of shares of Stock acquired by exercise of the Option results in
compensation income to Employee for federal or state income tax purposes,
Employee shall deliver to the Company at

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the time of such exercise or disposition such amount of money or shares of Stock
as the Company may require to meet its obligation under applicable tax laws or
regulations, and, if Employee fails to do so, the Company is authorized to
withhold from any cash or Stock remuneration then or thereafter payable to
Employee any tax required to be withheld by reason of such resulting
compensation income. Upon an exercise of this Option, the Company is further
authorized in its discretion to satisfy any such withholding requirement out of
any cash or shares of Stock distributable to Employee upon such exercise.

 

5. Status of Stock. The Company has registered for issuance under the Securities
Act of 1933, as amended (the “Act”) the shares of Stock acquirable upon exercise
of this Option, and keep such registration effective throughout the period this
Option is exercisable.

 

Employee agrees that the shares of Stock which Employees may acquire by
exercising this Option will not be sold or otherwise disposed of in any manner
which would constitute a violation of any applicable securities laws, whether
federal or state. Employee also agrees (i) that the certificates representing
the shares of Stock purchased under this Option may bear such legend or legends
as the Committee deems appropriate in order to assure compliance with applicable
securities laws, (ii) that the Company may refuse to register the transfer of
the shares of Stock purchased under this Option on the stock transfer records of
the Company if such proposed transfer would in the opinion of counsel
satisfactory to the Company constitute a violation of any applicable securities
laws and (iii) that the Company may give related instructions to its transfer
agent, if any, to stop registration of the transfer of the shares of Stock
purchased under this Option.

 

6. Employment Relationship. For purposes of this Agreement, Employee shall be
considered to be in the employment of the Company as long as Employee remains an
employee of either the Company, a parent or subsidiary corporation (as defined
in section 424 of the Code) of the Company, or a corporation or a parent or
subsidiary of such corporation assuming or substituting a new option for this
Option. Any question as to whether and when there has been a termination of such
employment, and the cause of such termination, shall be determined by the
Committee and its determination shall be final.

 

7. Binding Effect. This Agreement shall be binding upon and inure to the benefit
of any successors to the Company and all persons lawfully claiming under
Employee.

 

8. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Texas.

 

IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by
its officer thereunto duly authorized, and Employee has executed this Agreement,
all as of the day and year first above written.

 

GOODRICH PETROLEUM CORPORATION By:     Name:   Robert C. Turnham Jr. Title:  
President and Chief Operating Officer                   EMPLOYEE