Exhibit 10.1

FORM OF

RESOLUTE ENERGY CORPORATION

STOCK OPTION AGREEMENT

(Incentive Stock Option)

(Executive Officers)

 

This Stock Option Agreement (Incentive (this “Agreement”) between RESOLUTE
ENERGY CORPORATION (the “Corporation”) and ____________ (“Participant”) is dated
as of February 18, 2016 (the “Date of Grant”).

 

RECITALS

 

A.The Corporation has adopted the Resolute Energy Corporation 2009 Performance
Incentive Plan, as amended (the “Plan”);

B.The Plan provides for the granting of incentive awards to eligible persons as
determined by the Administrator; and

C.The Administrator has determined that Participant is a person eligible to
receive an incentive stock option award under the Plan and has determined that
it would be in the best interests of the Corporation to grant the award provided
for herein.

AGREEMENT

1.Grant of Option.

 

(a)Grant.  The Corporation hereby grants to Participant a stock option to
purchase [______] shares of the Corporation’s common stock (the “Common Stock”)
at an exercise price of $___ per share, which exercise price is 110% of the Fair
Market Value on the Date of Grant (the “Exercise Price”), subject to the terms
and conditions of the Plan and this Agreement (the “Option”).  The Option is
intended to be an incentive stock option within the meaning of Section 422 of
the Code and accordingly the Exercise Price is intended to be no less than the
Fair Market Value of the Common Stock on the Date of Grant.  The Option is
effective as of the Date of Grant.

 

(b)Plan Incorporated.  Participant acknowledges receipt of a copy of the Plan,
and agrees that, except as contemplated by Section 15 below, this Option shall
be subject to all of the terms and conditions set forth in the Plan, including
future amendments thereto, if any, pursuant to the terms thereof, which Plan is
incorporated herein by reference as a part of this Agreement.  Except as defined
herein, capitalized terms shall have the same meanings ascribed to them under
the Plan.

 

2.Vesting; Exercisability.  Unless sooner vested in accordance with this
Agreement, the Option shall vest and become exercisable in installments in
accordance with the following schedule, provided Participant remains
continuously employed by or providing services to the Corporation from the Date
of Grant through the vesting dates indicated below (each a “Vesting Date”):

 

 

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Vesting Date

Portion of Option Vesting on the Applicable

Vesting Date

March 8, 2017

 

March 8, 2018

 

March 8, 2019

 

 

Vesting shall be cumulative, so that once any portion of the Option becomes
vested and exercisable, it shall continue to be vested and exercisable in whole
or in part, as elected by Participant from time to time, until the Option
expires in accordance with Sections 4 or 5 below, as applicable.  If the
Participant is employed by a Subsidiary of the Corporation, any references in
this Agreement to employment with the Corporation shall instead be deemed to
refer to employment with such Subsidiary.

 

3.Exercise of Option.

 

(a)Procedure for Exercise.  If electing to exercise this Option as to all or a
part of the shares covered by this Option, Participant shall give written notice
to the Corporation of such election and of the number of shares he or she has
elected to purchase, in such form as the Administrator shall have prescribed or
approved, and shall, at the time of exercise, tender the full purchase price for
shares and make arrangements satisfactory to the Administrator with respect to
any withholding taxes required to be paid in connection with such
exercise.  Participant may pay the purchase price using any of the following
methods, or a combination thereof:

 

 

(i)

by certified or official bank check payable to the Corporation (or the
equivalent thereof acceptable to the Administrator);

 

 

(ii)

as permitted by the Administrator, by delivery of previously-acquired shares of
Common Stock owned by Participant having a Fair Market Value (determined as of
the Option exercise date) equal to the portion of the exercise price being paid
thereby;

 

 

 

(iii)

as permitted by the Administrator, on a net-settlement basis with the
Corporation withholding the amount of Common Stock sufficient to cover the
exercise price and tax withholding obligation; and/or

 

 

(iv)

as permitted by the Administrator, by delivery to the Corporation of a written
assignment of a sufficient amount of the proceeds from the sale of Common Stock
to be acquired pursuant to the exercise of the Option to pay for all of the
Common Stock to be acquired pursuant to the Option (along with applicable tax
withholdings) and an authorization to the broker or selling agent to pay that
amount to the Corporation and to effect such sale at the time of exercise.

 

 

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(b)Issuance of Shares.  Upon exercise of the Option, the Corporation shall
transfer the purchased shares to Participant electronically, or, if so requested
by Participant, by delivering a properly executed stock certificate for the
shares in his name. 

 

4.Expiration of Option.  The Option shall expire at 11:59 P.M. E.T. on February
17, 2026 (the “Expiration Date”), or, if earlier, following termination of
Participant’s employment as provided in Section 5.  

 

5.Termination of Employment.

 

(a)Termination for Cause. Upon termination of Participant’s employment or
service with the Corporation and its Subsidiaries by the Corporation or its
Subsidiaries for “cause,” any portion of this Option that is outstanding as of
the date of such termination of employment or service (whether vested and
exercisable or not) shall terminate upon the date of such termination of
employment or service.  The term “cause” shall have the meaning ascribed to such
term in the Participant’s employment contract, or if none, “cause” shall be
determined in good faith by the Administrator.

 

(b)Termination upon Death or Disability. Upon termination of Participant’s
employment or service with the Corporation and its Subsidiaries as a result of
death or Disability (as defined below), any portion of the Option that is
outstanding as of the date of termination of employment or service shall become
vested and exercisable in full (if not already vested and exercisable in full)
and shall remain exercisable for a period of one (1) year from the date of
termination of employment or service, and shall terminate
thereafter.  “Disability” for purposes of this Agreement, shall mean[: (A) if
the Participant’s employment with the Corporation is subject to the terms of an
employment agreement between the Participant and the Corporation, which
employment agreement includes a definition of “Disability,” the term
“Disability” as used in this Agreement shall have the meaning set forth in such
employment agreement during the period that such employment agreement remains in
effect; and (B) in the absence of such an agreement,] that Participant is unable
to perform the essential positions of his or her position with the Corporation
(without reasonable accommodation) for a consecutive period of 180 days by
reason of any medically determinable physical or mental impairment.

 

(c)      Termination other than for Cause, Death or Disability.  Upon
termination of Participant’s employment or service with the Corporation and its
Subsidiaries for any reason not set forth in subsections (a) or (b), the portion
of this Option that is outstanding and vested and exercisable as of the date of
termination of employment or service shall remain exercisable for a period of
ninety (90) days from the date of termination of employment or service and shall
terminate thereafter. Any portion of this Option which is not vested and
exercisable as of the date of such termination of employment or service shall
terminate upon the date of such termination of employment or service.

 

(d)Death Following Termination of Employment. In the event Participant dies
after terminating employment or service but prior to the expiration of the
applicable post-termination exercise period described in subsection (b) or (c)
above, then Participant’s

 

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beneficiary(ies) designated pursuant to Section 9 below shall be entitled to
exercise the then-outstanding portion of the Option for a period of one (1) year
following the date of death. 

 

(e)[FOR CEO, PRESIDENT AND CFO ONLY] Qualifying Retirement.  Notwithstanding the
retirement of the Participant, any portion of this Option that remains unvested
as of such retirement date shall not terminate, but shall continue to vest and
shall remain outstanding as if the Participant continued to be employed by the
Corporation, unless the Administrator reasonably determines that the retirement
was not a Qualifying Retirement.  The Participant hereby acknowledges that the
Option will cease to be an incentive stock option if not exercised within three
months following the Participant’s retirement.  “Qualifying Retirement” means
retirement by the Participant after the Participant has (1) attained the age of
65, (2) completed at least five years of employment with the Corporation or its
predecessor entities, and (3) remains in compliance with the terms of any
non-compete agreement between the Corporation and the Participant in place at
the time of Participant’s retirement.  In the event that subsequent to the date
of the Participant’s retirement, he breaches the terms of any such non-compete
agreement and fails to cure such breach within 60 days following written notice,
then any portion of this Option that remains outstanding at such time shall be
forfeited as of the end of such cure period.  The Participant agrees that he
shall give the Corporation a minimum of six months advanced written notice of
any retirement, except where circumstances do not permit such notice in which
case Participant shall give the maximum amount of advanced notice reasonably
practicable.  

(f)No Extension Beyond Expiration Date. Notwithstanding anything above to the
contrary, neither Participant nor any person claiming under or through
Participant shall be permitted to exercise any portion of the Option after the
Expiration Date.

 

6.Change of Control Event. The provisions of Section 7.3 of the Plan shall apply
upon the occurrence of a Change in Control Event.

 

7.Tax Withholding Obligations.  The Corporation’s obligation to issue Common
Stock pursuant to the exercise of this Option shall be subject to the
requirement that Participant make appropriate arrangements with the Corporation
to provide for payment of all applicable tax withholdings.  Participant may
elect to satisfy such tax withholdings obligations through one or a combination
of the following: (A) to pay such withholdings to the Corporation in cash, (B)
to have such withholdings deducted from his or her regular pay, or (C) if
permitted by the Administrator, to have the Corporation withhold from shares
otherwise issuable to Participant, shares having an aggregate Fair Market Value
equal to the minimum amount required to be withheld or such lesser amount as may
be elected by Participant; provided however, that the amount of stock so
withheld shall not result in an accounting charge to the Corporation.  All
fractional shares shall be settled in cash.  All elections shall be subject to
the approval or disapproval of the Administrator.  The value of shares withheld
shall be based on the Fair Market Value of the stock on the date that the amount
of tax to be withheld is to be determined (the “Tax Date”).  Any election to
have shares withheld for this purpose will be subject to the following
restrictions:

 

 

(i)

All elections must be made prior to the Tax Date;

 

 

(ii)

All elections shall be irrevocable; and

 

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(iii)

If Participant is an officer or director of the Corporation within the meaning
of Section 16 of the Exchange Act (“Section 16”), Participant must satisfy the
requirements of such Section 16 and any applicable rules thereunder with respect
to the use of stock to satisfy such tax withholding obligation.

 

8.Transferability. Except as set forth below, this Option may not be transferred
except by will or pursuant to the laws of descent and distribution and shall be
exercisable during Participant’ life only by the Participant, or in the event of
Disability or incapacity, by Participant’s guardian or legal representative.

 

9.Beneficiaries.  Participant may file with the Administrator a written
designation of a beneficiary on such form as may be prescribed by the
Administrator and may, from time to time, amend or revoke such designation. If
no designated beneficiary survives Participant, upon his death this Option may
be exercised only by the executor or administrator of his or her estate or by a
person who shall have acquired the right to such exercise by will or by the laws
of descent and distribution. No transfer of this Option by will or the laws of
descent and distribution shall be effective to bind the Corporation unless the
Administrator shall have been furnished with written notice thereof and with a
copy of the will and/or such evidence as the Administrator may deem necessary to
establish the validity of the transfer and an agreement by the transferee to
comply with all the terms and conditions of the Agreement that are or would have
been applicable to Participant and to be bound by the acknowledgments made by
Participant in connection with the grant of this Option.

 

10.No Rights as Stockholder Prior to Exercise. Neither Participant nor his
transferee shall have rights as a stockholder with respect to any shares covered
by this Option until the date the shares are transferred electronically or the
stock certificate is issued evidencing ownership of the shares. Except as
otherwise provided in the Plan, no adjustments shall be made for dividends
(ordinary or extraordinary), whether in cash, securities or other property, or
distributions or other rights, for which the record date is prior to the date
the shares are transferred electronically or the stock certificate is issued.

 

11.Authority of Administrator.  In making any decisions or taking any actions
with respect to the matters covered by this Agreement, the Administrator shall
have all of the authority and discretion, and shall be subject to all of the
protections, provided for in the Plan.  All decisions and actions by the
Administrator with respect to this Agreement shall be made in the
Administrator’s discretion and shall be final and binding on the Participant.

 

12.No Right to Continued Employment.  The Participant acknowledges and agrees
that, notwithstanding the fact that the vesting of the Option is contingent upon
his or her continued employment by the Corporation, this Agreement does not
constitute an express or implied promise of continued employment or confer upon
the Participant any rights with respect to continued employment by the
Corporation.  In the event that Participant is on an approved leave of absence,
vesting of the award under this Agreement while on leave from the employ of the
Corporation may be suspended, at the discretion of the Administrator, until the
Participant returns to service.

 

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13.Binding Effect.  This Agreement shall bind Participant and the Corporation
and their beneficiaries, survivors, executors, administrators and transferees.

 

14.Amendment.  The Corporation may modify, amend or waive the terms of this
award, prospectively or retroactively, but no such modification, amendment or
waiver shall impair the rights of Participant without his or her consent, except
as required by applicable law, NYSE or stock exchange rules, tax rules or
accounting rules.  Prior to the effectiveness of any modification, amendment or
waiver required by tax or accounting rules, the Corporation will provide notice
to Participant and the opportunity for Participant to consult with the
Corporation regarding such modification, amendment or waiver.  The waiver by
either party of compliance with any provision of this Agreement shall not
operate or be construed as a waiver of any other provision of this Agreement, or
of any subsequent breach by such party of a provision of this Agreement.  

 

15.Conflicts and Interpretation.  In the event of any conflict between this
Agreement and the Plan, this Agreement shall control.  In the event of any
ambiguity in this Agreement, or any matters as to which this Agreement is
silent, the Plan shall govern including, without limitation, the provisions
thereof pursuant to which the Administrator has the power, among others, to
(i) interpret the Plan, (ii) prescribe, amend and rescind rules and regulations
relating to the Plan and (iii) make all other determinations deemed necessary or
advisable for the administration of the Plan.

16.Compliance with Securities Laws.  

 

(a)          No Corporation Obligation.  The Corporation shall be under no
obligation to effect a registration pursuant to the Securities Act of any shares
of Common Stock to be issued hereunder or to effect similar compliance under any
other applicable laws. Notwithstanding anything herein to the contrary, the
Corporation shall not be obligated to cause to be issued or delivered any shares
of Common Stock unless and until the Corporation is advised by its counsel that
the issuance and delivery of such certificates is in compliance with all
applicable laws, regulations of governmental authorities and the requirements of
any securities exchange on which shares of Common Stock are traded. The
Administrator may require, as a condition of the issuance and delivery of shares
of Common Stock pursuant to the terms hereof, that the recipient of such shares
make such agreements and representations, and that such certificates bear such
legends, as the Administrator, in its sole discretion, deems necessary or
desirable.

 

(b)          Transfer of Shares Subject to Compliance with Laws.  The transfer
of any shares of Common Stock hereunder shall be effective only at such time as
counsel to the Corporation shall have determined that the issuance and delivery
of such shares is in compliance with all applicable laws, regulations of
governmental authorities and the requirements of any securities exchange on
which shares of Common Stock are traded. The Administrator may, in its sole
discretion, defer the effectiveness of any transfer of shares of Common Stock
hereunder in order to allow the issuance of such shares to be made pursuant to
registration or an exemption from registration or other methods for compliance
available under federal or state securities laws. The Administrator shall inform
Participant in writing of its decision to defer the effectiveness of a transfer.
During the period of such deferral in connection with the exercise of this
Option,

 

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Participant may, by written notice, withdraw such exercise and obtain the refund
of any amount paid with respect thereto.

 

17.Applicable Law.  This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware without regard to
conflict of law principles thereunder.

 

18.Participant’s Acknowledgments.  The Participant acknowledges that he or she
has read this Agreement, has received and read the Plan and the Prospectus
captioned Resolute Energy Corporation 2009 Performance Incentive Plan
(“Information”), and understands the terms and conditions of this Agreement, the
Plan and the Information.

 

19.Section 409A.  This Option is intended to be exempt from Code Section 409A as
an incentive stock option within the meaning of Section 422 of the Code or as an
exempt stock right as described in the Treasury Regulations issued under Code
Section 409A, and shall be interpreted accordingly.

 

 

[Signature Page Follows.]

 

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Exhibit 10.1

IN WITNESS WHEREOF, the parties have executed this Stock Option Agreement
(Incentive) as of the date first written above.

 

 

RESOLUTE ENERGY CORPORATION

 

 

 

By:                                                                 

 

   Name: James M. Piccone

 

   Title: President

 

  

 

 

 

 

PARTICIPANT

 

 

 

                                                                 

 

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