Exhibit 10.14

EMPLOYEE CASH BONUS AND STOCK AWARD RETENTION AGREEMENT

This Employee Cash Bonus and Stock Award Retention Agreement (this “Agreement”)
is entered into between GeoMet, Inc., a Delaware corporation with offices at Two
Houston Center, Suite 1850, 909 Fannin Street, Houston, Texas 77010 (“GeoMet”)
and Tony Oviedo (“you”) as of November 9, 2007 (the “Effective Date”).

1. RETENTION PAYMENT AND RESTRICTED STOCK AWARD. In order to compensate you for
your promotion to Vice President, Chief Accounting Officer and Controller, to
provide an incentive to encourage you to remain in the employ of GeoMet so that
GeoMet may receive your continued dedication, to assure the continued
availability of your advice and counsel and to assure that you will not provide
services for a competing business, GeoMet hereby agrees to pay you the following
cash bonus and grant you the following stock option and restricted stock award,
in addition to your regular salary and benefits (which salary is recognized to
be $180,000 per annum commencing on the Effective Date), provided you
continuously remain employed by GeoMet as its Vice President, Chief Accounting
Officer and Controller from the Effective Date through March 15, 2010 (the
“Retention Date”):

a. On the Retention Date, you shall be entitled to a cash payment equal to
$300,000.00, in lieu of the bonus payment you might otherwise be entitled to
receive on that date as a Tier I employee of GeoMet for performance in calendar
year 2009.

b. During the first open trading window (as defined in GeoMet’s Securities
Trading Policy) after the Effective Date, you will be granted 20,000 restricted
shares and options to purchase 60,000 shares of GeoMet common stock (in any
combination of ISO’s and NQSO’s that you elect, such election to be made in
writing on or before November 19, 2007) (the “Award Shares”) under the GeoMet
2006 Long-Term Incentive Plan (the “Plan”), which Award Shares shall vest on the
Retention Date, unless earlier vested as contemplated in Section 2 below, all in
accordance with and subject to the Plan and the form of the Restricted Stock
Award Agreement attached hereto as Exhibit A and the form of the Summary of
Stock Option Grant and Stock Option Award Agreement attached hereto as Exhibit
B.

The cash payments and the Award Shares described in clauses (a) and (b) above in
this Section 1 shall collectively be known as the Retention Payment. You will be
solely responsible for any taxes that may be incurred as a result of your
receiving the Retention Payment, and GeoMet will withhold all applicable taxes
from it in accordance with applicable law.

2. EFFECT OF CORPORATE CHANGE. Should GeoMet experience a “Corporate Change” (as
defined in Section 2.11 of the Plan) between the Effective Date and the
Retention Date and (a) your employment with GeoMet is terminated by GeoMet
without “Cause” (as defined in Section 2.6 of the Plan) following such Corporate
Change and prior to the Retention Date, or (b) you terminate your employment
with GeoMet for “Good Reason” (as defined in Section 2.18 of the Plan) following
such Corporate Change and prior to the Retention Date, then in connection with
such termination of employment: (i) GeoMet will pay you the cash portion of the
Retention Payment described above that has not been paid to you prior to such
termination date on the date that is ten (10) days after such termination;
(ii) the Award Shares described in Section 1.(b) above shall vest as of the date
of such termination; and, (iii) for a period of twelve (12) months following the
end of the month during which such termination of employment

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occurred, GeoMet will pay or reimburse you for the COBRA premiums paid or
incurred by you for the continuation coverage elected by you (for yourself, and
where applicable, your eligible dependents) pursuant to Section 601 of the
Employee Retirement Income Security Act of 1974, as amended, for the medical and
dental care benefits that are being provided to the active employees of GeoMet
and its affiliates or their successors (collectively the “Employer”) from time
to time; provided, however, that such payments or reimbursements shall terminate
if you become eligible to elect coverage for medical and dental care benefits
under a welfare plan of another employer. You are obligated hereunder to
promptly report such eligibility to the Employer. The foregoing provisions of
this Section 2 to the contrary notwithstanding, if you are a “specified
employee” (within the meaning of Section 409A(a)(2) of the Internal Revenue Code
of 1986, as amended (the “Code”) and the regulations and other guidance issued
thereunder) at the time of your termination of employment under the provisions
of this Section 2, then the payment of the cash portion of the Retention Payment
payable to you pursuant to Section 2(c) above shall be delayed and paid to you
(or in the event of your death, to your estate) on the first business day that
is six (6) months after your “separation from service” (within the meaning of
Section 409A of the Code and the regulations and other guidance issued
thereunder), or if earlier, within thirty (30) days after the date of your
death.

3. CODE SECTION 409A COMPLIANCE. The parties intend this Agreement to provide
for the payment of compensation that is not subject to the tax imposed under
Section 409A of the Code and this Agreement shall be interpreted and implemented
to the extent possible in accordance with such intent. However, neither the
GeoMet nor any of its affiliates makes any guarantee as to the tax treatment of
any payment to be made pursuant to this Agreement.

4. ARBITRATION; APPLICABLE LAW. The parties waive trial before a judge or jury
and agree to arbitrate with American Arbitration Association any dispute
relating to this agreement or your recruitment, employment, or termination,
except for claims relating to worker’s compensation benefits, unemployment
insurance, or intellectual property rights. The arbitrator’s decision will
include written findings of fact and law and will be final and binding except to
the extent that judicial review of arbitration awards is required by law. The
American Arbitration Association’s National Rules for the Resolution of
Employment Disputes will govern the arbitration, except that the arbitrator will
allow discovery authorized by the Texas Arbitration Act and any additional
discovery necessary to vindicate a claim or defense. The arbitrator may award
any remedy that would be available from a court of law. Any arbitration under
this Agreement shall be held in Harris County. The parties will share the
arbitration costs equally (except that GeoMet will pay the arbitrator’s fee and
any other cost unique to arbitration) and will pay their own attorney’s fees
except as required by law or separate agreement. This Agreement is governed by
the laws of the State of Texas without regard to its conflict-of-law rules.

5. ANNUAL CASH BONUSES AND STOCK OPTION GRANTS.

a. Cash Bonus. For calendar year 2007, you shall be entitled to a cash payment
equal to $45,000.00 payable on March 15, 2008 (in lieu of a bonus payment you
would be entitled to receive on that date as a Tier I or Tier II employee for
performance in calendar year 2007). For calendar year 2008, you will be eligible
for an annual cash bonus award which is payable in March, 2009 as a Tier I
employee of GeoMet. For calendar year 2009, you will not be eligible for an
annual cash bonus award to which you might otherwise be entitled as a Tier I
employee of GeoMet had you not entered into this Agreement.

 

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b. Stock Option Grants. For calendar years 2008 and 2009, you will not be
eligible for stock option grants, restricted stock awards or other share-based
awards pursuant to the Plan to which you might otherwise be entitled as a Tier I
employee of GeoMet had you not entered into this Agreement.

6. GEOMET, INC. SEVERANCE PLAN DATED EFFECTIVE JANUARY 29, 2007. You acknowledge
that you will not be entitled to any benefits under the GeoMet, Inc. Severance
Plan dated effective January 29, 2007 that you might otherwise be entitled to if
you had not entered into this Agreement.

7. AT-WILL EMPLOYMENT. This Agreement does not guarantee or imply any right to
continued employment for any period whatsoever. You and GeoMet acknowledge that
your employment is and shall continue to be at-will, as defined under applicable
law. If your employment terminates for any reason, all payments of compensation
and benefits shall cease and thereafter you shall not be entitled to any
payments, benefits, damages, awards or compensation except for the Retention
Payment if it has been earned as of such date of termination, and except as may
otherwise be available in accordance with established employee plans and
practices or other written agreements in effect between you and GeoMet at the
time of termination, taking into account the terms of this Agreement.

8. DURATION. The terms of this Agreement shall terminate upon the date that all
obligations of the parties hereunder have been satisfied; provided, however,
that this Agreement may be extended for an additional period or periods by
resolution adopted by the Board at any time during the period that the Agreement
is in effect.

9. MISCELLANEOUS PROVISIONS.

a. Whole Agreement. No agreements, representations or understandings (whether
oral or written and whether express or implied) which are not expressly set
forth in this Agreement have been made or entered into by either party with
respect to the subject matter hereof.

b. Employment Taxes. GeoMet will withhold from all payments made pursuant to
this Agreement the applicable income and employment taxes.

c. At Will Employment. Other than specifically set forth above, nothing in this
Agreement modifies your existing at-will employment relationship with GeoMet or
otherwise changes the terms of your employment agreement.

d. Employee Cash Bonus and Stock Award Retention Agreement dated November 20,
2006. Except as to the terms of that certain Employee Cash Bonus and Stock Award
Agreement dated November 20, 2006 (the “Prior Agreement”), as amended, that
relate to and govern the Award Shares described in Section 1.(b) therein, this
Agreement supersedes and replaces the Prior Agreement in its entirety.

 

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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
of the Company by its duly authorized officer, as of the day and year first
above written.

 

GeoMet, Inc.     Tony Oviedo By:   /s/ J. Darby Seré     /s/ Tony Oviedo  

J. Darby Seré

Chief Executive Officer and President

   

 

 

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Exhibit “A”

to that certain Employee Cash Bonus and Stock Award Agreement

dated November 9, 2007 between GeoMet, Inc. and Tony Oviedo

GEOMET, INC.

2006 LONG-TERM INCENTIVE PLAN

RESTRICTED STOCK AWARD AGREEMENT

THIS AGREEMENT, made and entered into as of the          day of November, 2007,
by and between GEOMET, INC., a Delaware corporation (“GeoMet”), and Tony Oviedo,
an employee or outside director of GeoMet or one of its Affiliates
(“Participant”).

WHEREAS, the Compensation Committee of GeoMet’s Board of Directors (the
“Committee”), acting under GeoMet’s 2006 Long-Term Incentive Plan (the “Plan”),
has the authority to award restricted shares of GeoMet’s common stock, $0.001
par value per share (the “Common Stock”), to certain employees or directors
providing services to GeoMet or an Affiliate (as defined in the Plan); and

WHEREAS, pursuant to the Plan, the Committee has determined to make such an
award to Participant on the terms and conditions and subject to the restrictions
set forth in the Plan and this Agreement, and Participant desires to accept such
award;

NOW, THERFORE, in consideration of the premises and mutual covenants and
agreements contained herein, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

1. Restricted Stock Award. On the terms and conditions and subject to the
restrictions, including forfeiture, hereinafter set forth, GeoMet hereby awards
to Participant, and Participant hereby accepts, a restricted stock award (the
“Award”) of 20,000 shares (the “Restricted Shares”) of Common Stock. The Award
is made effective as of the date of this Agreement (the “Effective Date”). A
certificate representing the Restricted Shares shall be issued in the name of
Participant (or, at the option of GeoMet, in the name of a nominee of GeoMet) as
of the Effective Date and delivered to Participant on the Effective Date or as
soon thereafter as practicable. Participant shall cause the certificate
representing the Restricted Shares, upon receipt thereof by Participant, to be
deposited, together with stock powers and any other instrument of transfer
reasonably requested by GeoMet duly endorsed in blank, with GeoMet, to be held
by GeoMet in escrow for Participant’s benefit until such time as the Restricted
Shares represented by such certificate are either forfeited by Participant to
GeoMet or the restrictions thereon terminate as set forth in this Agreement.

2. Vesting and Forfeiture.

(a) The Restricted Shares shall be subject to a restricted period (the
“Restricted Period”) that shall commence on the Effective Date and shall end on
March 15, 2010. During the Restricted Period, the Restricted Shares shall be
subject to being forfeited by Participant to GeoMet as provided in this
Agreement, and Participant may not sell, transfer, pledge, exchange, hypothecate
or otherwise dispose of any of the Restricted Shares (the “Restrictions”), other
than by will or pursuant to the applicable laws of descent and distribution,
provided Participant is in the continuous service of Employer or an Affiliate
until such date. Following the removal of the Restrictions on any Restricted
Shares, GeoMet shall deliver to Participant from escrow a certificate
representing such Shares and Participant shall be free to sell, transfer,
pledge, exchange, hypothecate or otherwise dispose of such Restricted Shares,
subject to applicable securities laws and the policies of GeoMet then in effect.

(b) Subject to paragraph (c) of this Section, upon termination of Participant’s
employment or service with GeoMet or any Affiliate, (i) Participant shall have
no rights whatsoever in and to any of the Restricted Shares if the Restrictions
have not by that time been removed pursuant to the foregoing paragraph, (ii) all
of the Restricted Shares shall automatically revert to GeoMet at no cost and
(iii) neither Participant nor any of his or her heirs, beneficiaries, executors,
administrators or other personal representatives shall have any rights with
respect thereto.

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(c) The Corporate Change provisions in the Plan shall apply with respect to the
removal of the Restrictions on the Restricted Shares.

3. Rights as Shareholder. Subject to the provisions of this Agreement, upon the
issuance of a certificate or certificates representing the Restricted Shares to
Participant, Participant shall become the record and beneficial owner thereof
for all purposes and shall have all rights as a stockholder, including without
limitation voting rights and the right to receive dividends and distributions,
with respect to the Restricted Shares. If and to the extent GeoMet shall effect
a stock split, stock dividend or similar distribution with respect to the Common
Stock, (i) the stock distributed pursuant thereto shall be held by GeoMet with
respect to those Restricted Shares as to which the Restrictions have not yet
been removed pursuant to Section 2; (ii) such additional stock shall enjoy the
privileges and be subject to the Restrictions applicable to the Restricted
Shares; and (iii) Participant shall be entitled to sell, transfer, pledge,
exchange, hypothecate or otherwise dispose of such additional stock when the
Restrictions on the Restricted Shares to which the distribution relates have
been removed pursuant to Section 2.

4. Optional Issuance in Book-Entry Form. Notwithstanding the foregoing, at the
option of GeoMet, any shares of Common Stock that under the terms of this
Agreement are issuable in the form of a stock certificate may instead be issued
in book-entry form.

5. Withholding Taxes.

(a) Participant may elect, within 30 days of the Effective Date and on notice to
GeoMet, to realize income for federal income tax purposes equal to the fair
market value of the Restricted Shares on the Effective Date. In such event,
Participant shall make arrangements satisfactory to GeoMet or the appropriate
Affiliate to pay in the calendar year that includes the Effective Date any
federal, state or local taxes required to be withheld with respect to such
shares.

(b) If no election is made by Participant pursuant to Section 5(a) hereof, then
upon the termination of the Restrictions applicable hereunder to the Restricted
Shares, Participant (or in the event of Participant’s death, the administrator
or executor of Participant’s estate) will pay to GeoMet or the appropriate
Affiliate, or make arrangements satisfactory to GeoMet or such Affiliate
regarding payment of, any federal, state or local taxes of any kind required by
law to be withheld with respect to the Restricted Shares with respect to which
such Restrictions have terminated.

(c) Any provision of this Agreement to the contrary notwithstanding, if
Participant does not satisfy his or her obligations under paragraphs (a) or
(b) of this Section, GeoMet shall, to the extent permitted by law, have the
right to deduct from any payments made under the Plan, regardless of the form of
such payment, or from any other compensation payable to Participant, whether or
not pursuant to this Agreement or the Plan and regardless of the form of
payment, any federal, state or local taxes of any kind required by law to be
withheld with respect to the Restricted Shares.

6. Reclassification of Shares. In the event of any reorganization,
recapitalization, stock split, stock dividend, merger, consolidation,
combination of shares or other change affecting the Common Stock, the Committee
shall make such adjustments as it may deem appropriate with respect to the
Restricted Shares. Any such adjustments made by the Committee shall be
conclusive.

7. Effect on Employment. Nothing contained in this Agreement shall confer upon
Participant the right to continue in the employment or service of GeoMet or any
Affiliate, or affect any right which GeoMet or any Affiliate may have to
terminate the employment or service of Participant. This Agreement does not
constitute evidence of any agreement or understanding, express or implied, that
GeoMet or any Affiliate will retain Participant as a Participant for any period
of time or at any particular rate of compensation.

 

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8. Investment Representations.

(a) The Restricted Shares are being received for Participant’s own account with
the intent of holding them and without the intent of participating, directly or
indirectly, in a distribution of such Shares and not with a view to, or for
resale in connection with, any distribution of such Shares or any portion
thereof.

(b) A legend may be placed on any certificate(s) or other document(s) delivered
to Participant or substitute therefore indicating restrictions on
transferability of the Restricted Shares pursuant to this Agreement or referring
to any stop transfer orders and other restrictions as the Committee may deem
advisable under the rules, regulations and other requirements of the Securities
and Exchange Commission, the New York Stock Exchange, NASDAQ or any other stock
exchange or association upon which the common stock of GeoMet is then listed or
quoted, any applicable federal or state securities laws, and any applicable
corporate law, and any transfer agent of GeoMet shall be instructed to require
compliance therewith.

9. Assignment. GeoMet may assign all or any portion of its rights and
obligations under this Agreement. The Award, the Restricted Shares and the
rights and obligations of Participant under this Agreement may not be sold,
transferred, pledged, exchanged, hypothecated or otherwise disposed of by
Participant other than by will or the applicable laws of descent and
distribution.

10. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of (i) GeoMet and its successors and assigns, and (ii) Participant and
his or her heirs, devisees, executors, administrators and personal
representatives.

11. Notices. All notices between the parties hereto shall be in writing and
given in the manner provided in Section 15.7 of the Plan. Notices to Participant
shall be sent to Participant’s address as contained in GeoMet’s records. Notices
to GeoMet shall be addressed to its Chief Financial Officer at the principal
executive offices of GeoMet as set forth in the Plan.

12. Governing Law; Exclusive Forum; Consent to Jurisdiction. This Agreement
shall be governed by and construed in accordance with the internal laws (and not
the principles relating to conflicts of laws) of the State of Texas, except as
superseded by applicable federal law. The exclusive forum for any action
concerning this Agreement or the transactions contemplated hereby shall be in a
court of competent jurisdiction in Harris County, Texas, with respect to a state
court, or the United States District Court for the Southern District of Texas,
Houston Division, with respect to a federal court. PARTICIPANT HEREBY CONSENTS
TO THE EXERCISE OF JURISDICTION OF A COURT IN THE EXCLUSIVE FORUM AND WAIVES ANY
RIGHT HE OR SHE MAY HAVE TO CHALLENGE OR CONTEST THE REMOVAL AT ANY TIME BY
GEOMET OR ANY OF ITS AFFILIATES TO FEDERAL COURT OF ANY SUCH ACTION HE OR SHE
MAY BRING AGAINST IT IN STATE COURT.

[SIGNATURE PAGE TO FOLLOW]

 

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IN WITNESS WHEREOF, GeoMet and Participant have executed this Agreement as of
the date first written above.

 

GEOMET, INC. By:     Name:     Title:     PARTICIPANT   Participant Signature  
Participant Printed Name

 

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STOCK POWER AND ASSIGNMENT

SEPARATE FROM CERTIFICATE

FOR VALUE RECEIVED and pursuant to that certain GeoMet, Inc. 2006 Long-Term
Incentive Plan and the 2006 Restricted Stock Award Agreement dated as of
November 20, 2006 (the “Agreement”), the undersigned Participant hereby sells,
assigns and transfers unto                          ,                         
shares of the Common Stock, $0.001 par value per share, of GeoMet, Inc., a
Delaware corporation (“GeoMet”), standing in the undersigned’s name on the books
of GeoMet and does hereby irrevocably constitute and appoint the Secretary of
GeoMet as the undersigned’s attorney-in-fact, with full power of substitution,
to transfer said stock on the books of GeoMet. THIS ASSIGNMENT MAY ONLY BE USED
AS AUTHORIZED BY THE AGREEMENT AND ANY EXHIBITS THERETO.

Dated:                                              

 

PARTICIPANT:

  Participant Signature   Participant Printed Name

 

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EXHIBIT “B”

To that certain Employee Cash Bonus and Stock Award Retention Agreement

dated November 9, 2007 between GeoMet, Inc. and Tony Oviedo

GEOMET, INC. 2006 LONG-TERM INCENTIVE PLAN

SUMMARY OF STOCK OPTION GRANT

You, the Optionee named below, have been granted the following option (the
“Option”) to purchase shares of the common stock, $0.001 par value per share
(the “Common Stock”), of GeoMet, Inc., a Delaware corporation (“GeoMet”), on the
terms and conditions set forth below and in accordance with the Stock Option
Award Agreement (the “Agreement”) to which this Summary of Stock Option Grant is
attached and the GeoMet, Inc. 2006 Long-Term Incentive Plan (the “Plan”):

 

Optionee Name:    Tony Oviedo Number of Option Shares Granted:    60,000 Type of
Option (check one):   

¨ Incentive Stock Option

 

¨ Nonqualified Stock Option

Grant Date:    November     , 2007 Exercise Price Per Share:   
$                             Vesting Commencement Date:    March 15, 2010
Vesting Schedule:    The Option shall vest and shares of Common Stock subject to
the Option shall become purchasable on the Vesting Commencement Date, if the
Optionee is in the continuous service of GeoMet or an Affiliate until such
vesting date. The Corporate Change provisions of the Plan shall apply with
respect to the Option.

You, by your signature as Optionee below, acknowledge that you (i) have reviewed
the Agreement and the Plan in their entirety and have had the opportunity to
obtain the advice of counsel prior to executing this Summary of Stock Option
Grant, (ii) understand that the Option is granted under and governed by the
terms and provisions of the Agreement and the Plan, and (iii) agree to accept as
binding all of the determinations and interpretations made by the Committee (as
defined in the Agreement) with respect to matters arising under or relating to
the Option, the Agreement and the Plan.

 

OPTIONEE:         GEOMET, INC.           By:     (Signature of Optionee)        
Name:   J. Darby Seré         Title:   President & Chief Executive Officer

 

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GEOMET, INC. 2006 LONG-TERM INCENTIVE PLAN

STOCK OPTION AWARD AGREEMENT

THIS AGREEMENT is made as of the Grant Date (as set forth on the Summary of
Stock Option Grant) between GeoMet, Inc., a Delaware corporation (“GeoMet”), and
Optionee pursuant to the GeoMet, Inc. 2006 Long-Term Incentive Plan (the
“Plan”).

WHEREAS, the Compensation Committee of the Board of Directors of GeoMet with
respect to an Option granted to an employee, or the Board of Directors of GeoMet
with respect to an Option granted to an outside director (the “Committee”), has
authority to grant Options under the Plan to employees and outside directors
performing services for GeoMet and its Affiliates; and

WHEREAS, the Committee has determined to award Optionee the Option described in
this Agreement;

NOW, THEREFORE, GeoMet and Optionee agree as follows:

1. Effect of Plan and Authority of Committee. This Agreement and the Option
granted hereunder are subject to the Plan, which is incorporated herein by
reference. The Committee is authorized to make all determinations and
interpretations with respect to matters arising under or relating to the Plan,
this Agreement and the Option granted hereunder. Capitalized terms used and not
otherwise defined herein have the respective meanings given them in the Plan or
in the Summary of Stock Option Grant, which are attached hereto and incorporated
herein by this reference for all purposes.

2. Grant of Option. On the terms and conditions set forth in this Agreement, the
Summary of Stock Option Grant and the Plan, as of the Grant Date, GeoMet hereby
grants to Optionee the option to purchase the number of shares of Common Stock
set forth on the Summary of Stock Option Grant at the Exercise Price per share
set forth on the Summary of Stock Option Grant (the “Option”). The Option is
intended to be an Incentive Stock Option or a Nonqualified Stock Option, as
provided in the Summary of Stock Option Grant. If the Option is intended to be
an Incentive Stock Option, it is agreed that the exercise price is at least 100%
of the Fair Market Value of a share of Common Stock on the Grant Date (110% of
Fair Market Value if Optionee owns stock possessing more than 10% of the total
combined voting power of all classes of stock of GeoMet or any Affiliate, within
the meaning of Section 422(b)(6) of the Code). If this Option is intended to be
an Incentive Stock Option, but the aggregate Fair Market Value of Common Stock
with respect to which Incentive Stock Options granted to Optionee (including all
options qualifying as incentive stock options pursuant to Section 422 of the
Code granted to Optionee under any other plan of GeoMet or any Affiliate) are
exercisable for the first time by Optionee during any calendar year exceeds
$100,000 (determined as of the date the Incentive Stock Option is granted), this
Option shall not be void but shall be deemed to be an Incentive Stock Option to
the extent it does not exceed the $100,000 limit and shall be deemed a
Nonqualified Stock Option to the extent it exceeds that limit. If this Option is
intended to be an Incentive Stock Option, Optionee shall notify GeoMet in
writing immediately after the date he or she makes a disqualifying disposition
of any shares of Common Stock acquired pursuant to the exercise of such
Incentive Stock Option. A disqualifying disposition is any disposition
(including any sale) of such Common Stock before the later of (i) two years
after the Grant Date of the Incentive Stock Option or (ii) one year after the
date of exercise of the Incentive Stock Option.

3. Vesting. This Option may be exercised only to the extent it is vested on the
vesting dates in accordance with the Vesting Schedule set forth in the Summary
of Stock Option Grant. The vested percentage indicated in such Vesting Schedule
shall be exercisable, as to all or part of the vested shares, at any time or
times after the respective vesting date and until the expiration or termination
of the Option. The vesting of this Option may be accelerated in certain events
as set forth in the Plan. The unvested portion of this Option shall terminate
and be forfeited immediately on the date of Optionee’s termination of employment
or service.

4. Term.

a. Term of Option. This Option may not be exercised after the expiration of
seven years from the Grant Date. If the expiration date of this Option or any
termination date provided for in this

 

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Agreement shall fall on a Saturday, Sunday or a day on which the executive
offices of GeoMet are not open for business, then such expiration or termination
date shall be deemed to be the last normal business day of the Company at its
executive offices preceding such Saturday, Sunday or day on which such offices
are closed.

b. Early Termination. Except as provided below, this Option may not be exercised
unless Optionee shall have been in the continuous employ or service of GeoMet or
any Affiliate from the Grant Date to the date of exercise of the Option. This
Option may be exercised after the date of Optionee’s termination of employment
or service with GeoMet and its Affiliates only in accordance with the specific
provisions and limitations of the Plan.

5. Manner of Exercise and Payment. The Optionee (or his or her representative,
guardian, devisee or heir, as applicable) may exercise any portion of this
Option that has become exercisable in accordance with the terms hereof as to all
or any of the shares of Common Stock then available for purchase by delivering
to GeoMet written notice, in a form satisfactory to the Committee, specifying:

a. the number of whole shares of Common Stock to be purchased together with
payment in full of the purchase price of such shares;

b. the address to which dividends, notices, reports, and other information are
to be sent; and

c. Optionee’s social security number or social insurance number.

Payment of the purchase price of the shares of Common Stock shall be made (i) in
cash, or by certified or cashier’s check payable to the order of GeoMet, free
from all collection charges, or (ii) by delivery of nonforfeitable, unrestricted
shares of Common Stock previously acquired by Optionee that have been held for
at least six months having an aggregate Fair Market Value as of the date of
exercise equal to the total exercise price, or (iii) by a combination of cash
(or certified or cashier’s check) and such already-owned shares of Common Stock.
Optionee also may elect to pay all or a portion of the purchase price of such
shares of Common Stock through a special sale and remittance procedure pursuant
to which Optionee shall concurrently provide (A) irrevocable instructions to a
broker-dealer to effect the immediate sale or margin of a sufficient portion of
the purchased shares and remit directly to GeoMet, out of the sale proceeds
available on the settlement date, sufficient funds to cover the purchase price
payable for the purchased shares plus all applicable taxes required to be
withheld by reason of such exercise and (B) an executed irrevocable option
exercise form to GeoMet along with instructions to GeoMet to deliver the
certificates for the purchased shares directly to such broker-dealer to complete
the sale. This Option shall be deemed to have been exercised on the first date
upon which GeoMet receives written notice of exercise as described above,
payment of the purchase price and all other documents, information and amounts
required with respect to such exercise under this Agreement and the Plan.
Notwithstanding the foregoing provisions of this Section 5, the Committee may,
in its discretion, reject payment of the purchase price of the shares of Common
Stock subject to this Option in the form of already-owned shares or through a
sale and remittance procedure with a broker-dealer in the event that the
Committee determines that such payment forms violate the provisions of
applicable law or result in negative accounting treatment to GeoMet.

6. Withholding Tax. Promptly after demand by GeoMet, and at its direction,
Optionee shall pay to GeoMet or the appropriate Affiliate an amount equal to the
applicable withholding taxes due in connection with the exercise of the Option.
Pursuant to the applicable provisions of the Plan, such withholding taxes may be
paid in cash or, subject to the further provisions of this Section 6 of this
Agreement, in whole or in part, by having GeoMet withhold from the shares of
Common Stock otherwise issuable upon exercise of the Option a number of shares
of Common Stock having a value equal to the amount of such withholding taxes or
by delivering to GeoMet or the appropriate Affiliate a number of previously
acquired issued and outstanding shares of Common Stock (excluding restricted
shares still subject to a risk of forfeiture) having a value equal to the amount
of such withholding taxes. The value of any shares of Common Stock so withheld
by or delivered to GeoMet or the appropriate Affiliate shall be based on the
Fair Market Value (as defined in the Plan) of such shares on the date on which
the tax withholding is to be made. Optionee shall pay to GeoMet or the
appropriate Affiliate in cash the amount, if any, by which the amount of such
withholding taxes exceeds the value of the shares of Common Stock so withheld or
delivered. An election by Optionee to have shares withheld or to deliver shares
to pay withholding taxes shall be made in accordance with administrative
guidelines established by the Committee.

 

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7. Delivery of Shares. Delivery of the certificates representing the shares of
Common Stock purchased, upon exercise of this Option shall be made as soon as
reasonably practicable after receipt of notice of exercise and full payment of
the Exercise Price and any required withholding taxes. If GeoMet so elects, its
obligation to deliver shares of Common Stock upon the exercise of this Option
shall be conditioned upon its receipt from the person exercising this Option of
an executed investment letter, in form and content satisfactory to GeoMet and
its legal counsel, evidencing the investment intent of such person and such
other matters as GeoMet may reasonably require. If GeoMet so elects, the
certificate or certificates representing the shares of Common Stock issued upon
exercise of this Option shall bear a legend to reflect any restrictions on
transferability.

8. Optional Issuance in Book-Entry Form. Notwithstanding the provisions of
Section 7, at the option of GeoMet, any shares of Common Stock that under the
terms of this Agreement are issuable in the form of a stock certificate may
instead be issued in book-entry form.

9. Transferability. This Option is personal to Optionee and during Optionee’s
lifetime may be exercised only by Optionee or his or her guardian or legal
representative upon the events and in accordance with the terms and conditions
set forth in the Plan, and shall not be transferred except by will or by the
laws of descent and distribution, nor may it be otherwise sold, transferred,
pledged, exchanged, hypothecated or otherwise disposed of in any way (by
operation of law or otherwise) and it shall not be subject to execution,
attachment or similar process. Any attempted sale, transfer, pledge, exchange,
hypothecation or other disposition of this Option not specifically permitted by
the Plan or this Agreement shall be null and void and without effect.

10. Notices. All notices between the parties hereto shall be in writing and
given in the manner provided in the Plan. Notices to Optionee shall be sent to
Optionee’s address as contained in GeoMet’s records. Notices to GeoMet shall be
addressed to its Chief Financial Officer at the principal executive offices of
GeoMet as set forth in the Plan.

11. Relationship With Contract of Employment or Services.

a. The grant of an Option does not form part of Optionee ‘s entitlement to
remuneration or benefits pursuant to his or her contract of employment or
services, if any, and, except as otherwise provided in a written contract of
employment or for services, the existence of such a contract between any person
and GeoMet or any Affiliate does not give such person any right or entitlement
to have an Option granted to him or any expectation that an Option might be
granted to him whether subject to any conditions or at all.

b. The rights and obligations of Optionee under the terms of his or her contract
of employment or other contract or agreement for services with GeoMet or any
Affiliate, if any, shall not be affected by the grant of an Option.

c. The rights granted to Optionee upon the grant of an Option shall not afford
Optionee any rights or additional rights to compensation or damages in
consequence of the loss or termination of his or her office, employment or
service with GeoMet or any Affiliate for any reason whatsoever.

d. Optionee shall not be entitled to any compensation or damages for any loss or
potential loss which he or she may suffer by reason of being or becoming unable
to exercise an Option in consequence of the loss or termination of his or her
office, employment or service with GeoMet or any Affiliate for any reason
(including, without limitation, any breach of contract by GeoMet or any
Affiliate) or in any other circumstances whatsoever.

12. Market Standoff Agreement. Optionee agrees in connection with any public
offering of GeoMet’s securities that, upon request of GeoMet or the managing
underwriter(s) of such offering, Optionee will not sell or otherwise dispose of
any Common Stock acquired pursuant to this Agreement without the prior written
consent of GeoMet or such managing underwriter(s), as the case may be, for a
period of time (not to exceed 180 days) after the effective date of the
registration requested by such managing underwriter(s) and subject to all
restrictions as GeoMet or the managing underwriter(s) may specify for employee
stockholders generally.

 

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13. Governing Law; Exclusive Forum; Consent to Jurisdiction. This Agreement
shall be governed by and construed in accordance with the internal laws (and not
the principles relating to conflicts of laws) of the State of Texas, except as
superseded by applicable federal law. The exclusive forum for any action
concerning this Agreement or the transactions contemplated hereby shall be in a
court of competent jurisdiction in Harris County, Texas, with respect to a state
court, or the United States District Court for the Southern District of Texas,
Houston Division, with respect to a federal court. OPTIONEE HEREBY CONSENTS TO
THE EXERCISE OF JURISDICTION OF A COURT IN THE EXCLUSIVE FORUM AND WAIVES ANY
RIGHT HE OR SHE MAY HAVE TO CHALLENGE OR CONTEST THE REMOVAL AT ANY TIME BY
GEOMET OR ANY OF ITS AFFILIATES TO FEDERAL COURT OF ANY SUCH ACTION HE OR SHE
MAY BRING AGAINST IT IN STATE COURT.

 

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