Exhibit 10.1

 

SECOND AMENDMENT

 

TO

 

WARREN RESOURCES, INC.

 

2010 STOCK INCENTIVE PLAN

 

WARREN RESOURCES, INC., a Maryland corporation (the “Company”) adopted the
Warren Resources, Inc. 2010 Stock Incentive Plan, originally effective January
1, 2010 and first amended effective as of January 1, 2012 (as first amended, the
“Plan”). This Second Amendment to the Plan is made effective as of June 2, 2015
(the “Amendment Effective Date”), subject to approval by the Company’s
stockholders.

 

RECITALS

 

A.   The Company established the Plan under which the Company is authorized to
grant equity-based and cash incentive awards to certain employees, consultants
and directors who are not employees of the Company and its Subsidiaries;

 

B.   Section 14 of the Plan provides that the Company’s board of directors (the
“Board”) may amend the Plan subject to, in certain circumstances, the requisite
prior or subsequent stockholder approval;

 

C. The Board now desires to amend the Plan in the manner contemplated hereby,
subject to approval by the Company’s stockholders at the Company’s 2015 annual
meeting, to (a) provide that the maximum number of shares of Common Stock in
respect of which Awards may be granted under the Plan is 9,950,000, (b) provide
that each share of Common Stock subject to an Award other than Stock Options and
stock-settled Stock Appreciation Rights counts as 1.5 shares of Common Stock
against the Plan Maximum while any stock options and stock appreciation rights
are counted against the Plan Maximum as 1 share of Common Stock, and (c) remove
the “reload” options from the suite of options available for issuance under the
Plan; and

 

D.   Capitalized terms used but not defined herein shall have the same meaning
as set forth in the Plan.

 

AMENDMENTS

 

1.              Section 5 of the Plan is hereby deleted and replaced in its
entirety with the following:

 

5.                                      DURATION OF AND COMMON STOCK SUBJECT TO
PLAN.

 

(a)         Term.  Subject to Section 13 below, the Plan shall terminate on ten
(10) years from the date of adoption by the shareholders of the Company, except
with respect to Awards then outstanding. No new Award may be granted under the
Plan after that date.

 

(b)         Shares of Common Stock Subject to Plan.    The maximum number of
shares of Common Stock in respect of which Awards may be granted under the Plan
(the “Plan Maximum”) shall be 9,950,000, subject to adjustment as provided in
Section 11 below. Common Stock issued under the Plan may be either authorized
and unissued shares or treasury shares. The following terms and conditions shall
apply to Common Stock subject to the Plan:

 

(i)

In no event shall more than the Plan Maximum be cumulatively available for
Awards under the Plan;

 

 

(ii)

For the purpose of computing the total number of shares of Common Stock
available for Awards under the Plan, there shall be counted against the
foregoing limitations (A) the number of shares of Common Stock subject to
issuance upon exercise or settlement of Awards (regardless of vesting), and (B)
the number of shares of Common Stock which equal the value of Restricted Unit
Grants or Stock Appreciation Rights determined at the dates on which such Awards
are granted.

 

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Awards that are made in a form other than Stock Options or stock-settled Stock
Appreciation Rights and that are granted under the Plan after June 1, 2015,
shall be counted against the Plan Maximum as set forth in the previous sentence
as 1.5 shares of Common Stock for every one share of Common Stock subject to
issuance in connection with such Award while any stock options and stock
appreciation rights are counted against the Plan Maximum as 1 share of Common
Stock;

 

 

(iii)

If any Awards are forfeited, cancelled, terminated, expire unexercised, settled
in cash in lieu of stock (including the settlement of tax withholding
obligations using Shares) or exchanged for other Awards, the shares of Common
Stock which were previously subject to the Awards shall again be available for
Awards under the Plan to the extent of such forfeiture, termination, expiration,
cash settlement or exchange; provided, however, in the case of an Award that is
not a Stock Option or stock-settled Stock Appreciation Right and that was made
after June 1, 2015, 1.5 shares of Common Stock for each share of Common Stock
underlying such Award shall again be available for Awards under the Plan; and

 

 

(iv)

Any shares of Common Stock which are used as full or partial payment to the
Company by a Participant of the purchase price of shares of Common Stock upon
exercise of a Stock Option shall again be available for Awards under the Plan.

 

2.              Section 6(d) of the Plan is hereby deleted and replaced in its
entirety with the following:

 

(d)                                 Exercisability.

 

(i)

Incentive Stock Options and Nonqualified Stock Options shall be exercisable in
installments as determined by the Committee in its sole discretion, and shall be
subject to such other terms and conditions as the Committee shall determine at
the date of grant; provided that if not otherwise determined by the Committee,
Incentive Stock Options and Nonqualified Stock Options may be exercised as to
one-third (33.33%) of the shares covered thereby beginning on the first
anniversary date of the date of grant (hereinafter, an “Anniversary Date”) and
thereafter an additional one-third (33.33%) on the second Anniversary Date, and
an additional one-third (33.33%) on the third Anniversary Date, except as
otherwise provided in Sections 9 and 12.

 

 

(ii)

Deferred Compensation Stock Options shall become exercisable in accordance with
the terms of the grant thereof as established by the Committee.

 

3.              Section 6(h) of the Plan is hereby deleted and replaced in its
entirety with the following:

 

(h)                                 Tax Withholding.    In addition to the
alternative methods of exercise set forth in Section 6(e), holders of
Nonqualified Stock Options, subject to the discretion of the Committee, may be
entitled to elect at or prior to the time the exercise notice is delivered to
the Company, to have the Company withhold from the shares of Common Stock to be
delivered upon exercise of the Nonqualified Stock Option the number of shares of
Common Stock (determined based on the Fair Market Value) that is necessary to
satisfy any withholding taxes attributable to the exercise of the Nonqualified
Stock Option so long as the amount withheld does not exceed the Company’s
minimum statutory tax withholding attributable to the underlying transaction.
Notwithstanding the foregoing provisions, a holder of a Nonqualified Stock
Option may not elect to satisfy his or her withholding tax obligation in respect
of any exercise as contemplated above if, in the opinion of counsel to the
Company, there is substantial risk that such election could result in a
violation of any then applicable rules or regulations, including federal or
state securities law, or such withholding would have an adverse tax or
accounting effect on the Company.

 

4.              Section 6(i) of the Plan is hereby deleted in its entirety.

 

5.              Except as set forth above, the Plan shall continue to read in
its current state.

 

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IN WITNESS WHEREOF, the Company has cause the execution of this Second Amendment
by its duly authorized officer, effective as of the Amendment Effective Date.

 

 

 

WARREN RESOURCES, INC.

 

 

 

 

 

By:

/s/ SAEMA SOMALYA

 

 

Name:

Saema Somalya

 

 

Title:

Senior Vice President, General Counsel and Corporate Secretary

 

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