##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Form 10-K
 þ
    
    ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2007
 Commission file number 001-32977
 GMX RESOURCES INC.
  Oklahoma
    
    73-1534474(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)9400 North Broadway, Suite 600, Oklahoma City, Oklahoma
    
    73114(Address of principal executive offices)
    
    (Zip Code)(Registrants telephone number, including area code)
    
    (405) 600-0711
  Title of Class
    
    Name of Exchange on Which RegisteredCommon Stock, $0.001 par value
    
    The NASDAQ Stock Market, LLC Global SelectSeries B Cumulative Preferred Stock, $0.001 par value
    
    The NASDAQ Stock Market, LLC Global SelectSeries A Preferred Stock Purchase Rights
    
    The NASDAQ Stock Market, LLC Global Select
  Yes o  No þ
 Yes o  No þ
 þ o
 o
  Large accelerated filer o
    
    Accelerated filer þNon-accelerated filer o
    
    Smaller reporting company o
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE:




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##### 



GMX RESOURCES INC.
Form 10-K
Table of Contents
 PagePART I
    
    
    3Item 1. Business
    
    
    3Item 1A. Risk Factors
    
    
    20Item 1B. Unresolved Staff Comments
    
    
    31Item 2. Properties
    
    
    31Item 3. Legal Proceedings
    
    
    31Item 4. Submission of Matters to a Vote of Security Holders
    
    
    31PART II
    
    
    32Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    32Item 6. Selected Financial Data
    
    
    34Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operation
    
    
    35Item 7A. Quantitative and Qualitative Disclosures About Market Risk
    
    
    50Item 8. Financial Statements and Supplementary Data
    
    
    52Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
    
    
    52Item 9A. Controls and Procedures
    
    
    52Item 9B. Other Information
    
    
    54PART III
    
    
    54PART IV
    
    
    55Item 15. Exhibits and Financial Statement Schedules
    
    
    55Exhibit 23.1Exhibit 23.2Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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PART I
 
 Item 1. Business
 General
 GMX Resources Inc.
   History
  Strategy
  Control drilling with ownership of rigs
 Expand operated acreage position
  3




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Use leverage and hedging prudently
 Maintain production infrastructure
 Company Strengths
 Large, continuous acreage position in the heart of the East Texas Cotton Valley natural gas
play
 Strong growth profile
 Favorable economics achieved through investment in infrastructure
 Low Finding and Development Costs
 East Texas
   4




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##### Table of Contents



Wells DrilledGross
    
    Net100% WI Area
    
    
    39
    
    
    
    3950% WI Area
    
    
    43
    
    
    
    2130% WI Area
    
    
    38
    
    
    
    11Total
    
    
    120
    
    
    
    71
    5




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Proved Undeveloped Locationson 40 and 20 Acre SpacingGross
    
    Net100% WI Area
    
    
    202
    
    
    
    20250% WI Area
    
    
    118
    
    
    
    5930% WI Area
    
    
    117
    
    
    
    35Total
    
    
    437
    
    
    
    296
  Expected Wells tobe DrilledGross
    
    Net100% WI Area
    
    
    41-47
    
    
    
    41-4750% WI Area
    
    
    43
    
    
    
    2230% WI Area
    
    
    38
    
    
    
    11Total
    
    
    122-128
    
    
    
    74-80
   6




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Other Properties
  2008 Recent Developments
 Acreage Acquisition
 Natural Gas Processing Agreement
  7




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Changes in Management
   Note Offering
  8




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Gas Gathering
    Diamond Blue Drilling
  Rig No.
    
    DepthCapacity(Feet)
    
    DrawworksHorsepowerDBD #7
    
    
    11,000
    
    
    1,000 HPDBD #9
    
    
    15,000
    
    
    1,200 HPDBD #11
    
    
    14,000
    
    
    1,000 HP
  Reserves
   9




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At December 31,2005
    
    2006
    
    2007Proved Developed:Gas (Bcf)
    
    
    41.2
    
    
    
    69.3
    
    
    
    144.2Oil (MMBbls)
    
    
    .8
    
    
    
    .9
    
    
    
    1.8Total (Bcfe)
    
    
    45.7
    
    
    
    74.9
    
    
    
    155.0Proved Undeveloped:Gas (Bcf)
    
    
    108.8
    
    
    
    167.6
    
    
    
    262.1Oil (MMBbls)
    
    
    1.2
    
    
    
    1.8
    
    
    
    2.9Total (Bcfe)
    
    
    116.0
    
    
    
    178.1
    
    
    
    279.5Total Proved:Gas (Bcf)
    
    
    150.0
    
    
    
    236.9
    
    
    
    406.3Oil (MMBbls)
    
    
    2.0
    
    
    
    2.7
    
    
    
    4.7Total (Bcfe)
    
    
    161.7
    
    
    
    253.0
    
    
    
    434.5Estimated Future Net Revenues1($000s)
    
    $
    692.9
    
    
    $
    519.5
    
    
    $
    1,896.3Present Value1($000s)
    
    $
    245.0
    
    
    $
    173.3
    
    
    $
    592.8Standardized Measure1($000s)
    
    $
    185.5
    
    
    $
    134.4
    
    
    $
    427.7
 
 1
    
    The prices used in calculating Estimated
Future Net Revenues and the Present Value are determined using prices as of
period end. Estimated Future Net Revenues and the Present Value give no effect
to federal or state income taxes attributable to estimated future net revenues.
See Note MSupplemental Information on Oil and Natural Gas Operations for
information about the standardized measure of discounted future net cash flows.
We believe that the Estimated Future Net Revenue and Present Value are useful
measures in addition to the standardized measure as it assists in both the
determination of future cash flows of the current reserves as well as in making
relative value comparisons among peer companies. The standardized measure is
dependent on the unique tax situation of each individual company, while the
pre-tax Present Value is based on prices and discount factors which are
consistent from company to company. We also understand that securities
analysts use this measure in similar ways.    10




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Costs Incurred
  Year Ended December 31,2005
    
    
    2006
    
    
    2007(in thousands)Property acquisition costs  unproved
    
    $
    1,256
    
    
    $
    598
    
    
    $
    1,018Development costs
    
    
    25,211
    
    
    
    104,657
    
    
    
    177,523Total
    
    $
    26,467
    
    
    $
    105,255
    
    
    $
    178,541
 Drilling Results
  Year Ended December 31,2005
    
    2006
    
    2007Development wells:
    
    Gross
    
    Net
    
    Gross
    
    Net
    
    Gross
    
    NetGas
    
    
    31
    
    
    
    16
    
    
    
    67
    
    
    
    35.3
    
    
    
    127
    
    
    
    76.5Oil
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Dry
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    31
    
    
    
    16
    
    
    
    67
    
    
    
    35.3
    
    
    
    127
    
    
    
    76.5
  11




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Acreage
  Developed
    
    UndevelopedLocation
    
    Gross
    
    Net
    
    Gross
    
    NetEast Texas
    
    
    26,291
    
    
    
    15,055
    
    
    
    9,574
    
    
    
    6,376Other
    
    
    2,520
    
    
    
    1,827
    
    
    
    
    
    
    
    Total
    
    
    28,811
    
    
    
    16,882
    
    
    
    9,574
    
    
    
    6,376
  Productive Well Summary
  Productive WellsType of Well
    
    Gross
    
    NetGas
    
    
    279
    
    
    
    158.6Oil
    
    
    21
    
    
    
    16.4Total
    
    
    300
    
    
    
    175.0
 Facilities
   Employees
   12




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Marketing
  Natural Gas.
  Crude Oil.
    13




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Competition
   Regulation
 Exploration and Production.
  Environmental Matters.
  14




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15




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Marketing and Transportation.
    Certain Technical Terms
  Bbl.
 Bcf.
  16




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Bcfe.
 Btu.
 BBtu.
 Developed Acreage.
 Development Location.
 Development Well.
 Drilling Unit.
 Dry Hole.
 Estimated Future Net Revenues.
 Exploratory Well.
 Finding and Development Costs
 Gross Acre.
 Gross Well.
 Infill Drilling.
  17




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Injection Well.
 Lease Operating Expense.
 MBbls.
 MBtu.
 Mcf.
 Mcfpd
 Mcfe.
 MMBbls.
 MMBtu.
 MMcf.
 MMcfe.
 Natural Gas Liquids.
 Net Acres or Net Wells.
 NYMEX.
 Operator.
 Present Value.
 Productive Well.
 Proved Developed Reserves.
  18




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Proved Reserves.
 Proved Undeveloped Reserves.
 Recompletion.
 Royalty.
 Secondary Recovery.
 Undeveloped Acreage.
 Waterflood.
  19




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Working Interest.
 Workover.
 Availability of Information
   
 Item 1A. Risk Factors.
 Risks Related to GMX
 The loss of our President or other key personnel could adversely affect us.
  Our wells produce oil and natural gas at a relatively slow rate.
   20




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Our future performance depends upon our ability to obtain capital to find or acquire
additional oil and natural gas reserves that are economically recoverable.
  We have not paid dividends and do not anticipate paying any dividends on our common stock in
the foreseeable future.
  Hedging our production may result in losses or limit potential gains.
  
    
    production is less than expected;
    
    the counter-party to the hedging contract defaults on its contact
obligations; or
    
    there is a change in the expected differential between the underlying
price in the hedging agreement and actual prices received.
   21




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Our revolving bank credit facility and secured note agreement contain certain covenants that
may inhibit our ability to make certain investments, incur additional indebtedness and engage in
certain other transactions, which could adversely affect our ability to meet our future goals. If
our revolving bank credit facility or our secured note agreement were to be accelerated, we may not
have sufficient liquidity to repay our indebtedness in full.
  
    
    our investments, loans and advances and the paying of dividends on common
stock and other restricted payments;
    
    our incurrence of additional indebtedness;
    
    the granting of liens, other than liens created pursuant to the credit
facility and certain permitted liens;
    
    mergers, consolidations and sales of all or substantial part of our
business or properties; and
    
    the hedging, forward sale or swap of our production of crude oil or
natural gas or other commodities.
  Failure by us to achieve and maintain effective internal control over financial reporting in
accordance with the rules of the SEC could harm our business and operating results and/or result in
a loss of investor confidence in our financial reports, which could have a material adverse effect
on our business and stock price.
   22




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Delays in development or production curtailment affecting our material properties may
adversely affect our financial position and results of operations.
  A majority of our production, revenue and cash flow from operating activities is derived from
assets that are concentrated in a geographic area.
  Servicing our debt requires a significant amount of cash, and we may not have sufficient cash
flow from our business to pay our substantial debt.
   23




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Risks Related to the Oil and Natural Gas Industry
 A substantial decrease in oil and natural gas prices would have a material impact on us.
   
    
    worldwide and domestic supplies of oil and natural gas;
    
    weather conditions;
    
    the level of consumer demand;
    
    the price and availability of alternative fuels;
    
    the availability of pipeline capacity;
    
    the price and level of foreign imports;
    
    domestic and foreign governmental regulations and taxes;
    
    the ability of the members of the Organization of Petroleum Exporting
Countries to agree to and maintain oil price and production controls;
    
    political instability or armed conflict in oil and natural gas producing
regions, and
    
    the overall economic environment.
  We may encounter difficulty in obtaining equipment and services.
   24




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Estimates of proved natural gas and oil reserves and present value of proved reserves are not
precise.
    We may incur write-downs of the net book values of our oil and natural gas properties that
would adversely affect our shareholders equity and earnings.
   25




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Operational risks in our business are numerous and could materially impact us.
  
    
    the presence of unanticipated pressure or irregularities in formations;
    
    accidents;
    
    title problems;
    
    weather conditions;
    
    compliance with governmental requirements;
    
    shortages or delays in the delivery of equipment;
    
    injury or loss of life;
    
    severe damage to or destruction of property, natural resources and
equipment;
    
    pollution or other environmental damage;
    
    clean-up responsibilities;
    
    regulatory investigation and penalties; and
    
    other losses resulting in suspension of our operations.
  Governmental regulations could adversely affect our business.
   26




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Environmental liabilities could adversely affect our business.
  
    
    from a well or drilling equipment at a drill site;
    
    leakage from gathering systems, pipelines, transportation facilities and
storage tanks;
    
    damage to oil and natural gas wells resulting from accidents during normal
operations; and
    
    blowouts, cratering and explosions.
   Competition in the oil and natural gas industry is intense, and we are smaller than many of
our competitors.
   27




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Risks Related to Our Common Stock
 Shares eligible for future sale may depress our stock price.
  The price of our common stock has been volatile and could continue to fluctuate substantially.
  
    
    fluctuations in commodity prices;
    
    variations in results of operations;
    
    legislative or regulatory changes;
    
    general trends in the industry;
    
    market conditions; and
    
    analysts estimates and other events in the natural gas and crude oil
industry.
 Future issuance of additional shares of our common stock could cause dilution of ownership
interests and adversely affect our stock price.
   28




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The issuance of our common stock pursuant to a share lending agreement, including sales of the
shares that we will lend, and other market activity related to the share lending agreement may
lower the market price of our common stock.
    Our existing preferred stock has greater rights than our common stock, and we may issue
additional preferred stock in the future.
   29




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Our common stock is an unsecured equity interest in our company.
  Anti-takeover provisions in our organizational documents, our convertible senior notes, other
outstanding debt and Oklahoma law could have the effect of discouraging, delaying or preventing a
merger or acquisition, which could adversely affect the market price of our common stock.
   
    
    a shareholder rights plan;
    
    authorizing our board of directors to issue blank check preferred stock
without shareholder approval;
    
    prohibiting cumulative voting in the election of directors;
    
    limiting the persons who may call special meetings of shareholders;
    
    establishing advance notice requirements for election to our board of
directors or proposing matters that can be acted on by shareholders at shareholder
meetings; and
    
    prohibiting shareholders from amending our bylaws.
    30




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Item 1B. Unresolved Staff Comments.
  
 Item 2. Properties.
  
 Item 3. Legal Proceedings.
  
 Item 4. Submission of Matters to a Vote of Security Holders.
   31




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PART II
 
 Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
 Common Stock
  High
    
    LowYear Ended December 31, 2006First Quarter
    
    $
    50.50
    
    
    $
    28.65Second Quarter
    
    
    47.00
    
    
    
    25.17Third Quarter
    
    
    35.12
    
    
    
    25.40Fourth Quarter
    
    
    48.88
    
    
    
    30.60Year Ended December 31, 2007First Quarter
    
    $
    38.38
    
    
    $
    28.35Second Quarter
    
    
    40.70
    
    
    
    30.55Third Quarter
    
    
    36.78
    
    
    
    30.00Fourth Quarter
    
    
    40.04
    
    
    
    30.52
   Shareholder Return Performance Graph
   32




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*
    
    $100 invested on 12/31/02 in stock or index-including reinvestment of dividends.
Fiscal year ending December 31. Recent Sales of Unregistered Securities
  Purchases of Equity Securities
   33




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Item 6. Selected Financial Data.
  Year Ended December 31,2003
    
    
    2004
    
    
    2005
    
    
    2006
    
    
    2007(in thousands, except share and per share data)Statement of Operations Data:Oil and natural gas sales
    
    $
    5,367
    
    
    $
    7,690
    
    
    $
    19,026
    
    
    $
    31,882
    
    
    $
    67,883Interest and other income
    
    
    22
    
    
    
    144
    
    
    
    167
    
    
    
    151
    
    
    
    226Total revenues
    
    
    5,389
    
    
    
    7,834
    
    
    
    19,193
    
    
    
    32,033
    
    
    
    68,109Lease operations
    
    
    850
    
    
    
    1,261
    
    
    
    2,070
    
    
    
    4,479
    
    
    
    8,982Production and severance taxes(1)
    
    
    384
    
    
    
    519
    
    
    
    1,241
    
    
    
    465
    
    
    
    2,746General and administrative
    
    
    1,579
    
    
    
    1,986
    
    
    
    3,389
    
    
    
    5,829
    
    
    
    8,717Depreciation, depletion and amortization
    
    
    1,550
    
    
    
    2,043
    
    
    
    3,982
    
    
    
    8,046
    
    
    
    18,681Interest
    
    
    439
    
    
    
    559
    
    
    
    143
    
    
    
    824
    
    
    
    4,088Total expenses
    
    
    4,802
    
    
    
    6,368
    
    
    
    10,825
    
    
    
    19,643
    
    
    
    43,214Income before income taxes
    
    
    587
    
    
    
    1,466
    
    
    
    8,368
    
    
    
    12,390
    
    
    
    24,895Income tax expense  current
    
    
    
    
    
    
    24
    
    
    
    
    
    
    
    
    
    
    
    33Income tax expense  deferred
    
    
    
    
    
    
    
    
    
    
    1,212
    
    
    
    3,415
    
    
    
    7,977Net income before cumulative effect of a
change in accounting principle
    
    
    587
    
    
    
    1,442
    
    
    
    7,156
    
    
    
    8,975
    
    
    
    16,885Cumulative effect of a change in accounting
principle
    
    
    (52
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,799
    
    
    
    4,625Net income applicable to common stock
    
    $
    535
    
    
    $
    1,442
    
    
    $
    7,156
    
    
    $
    7,176
    
    
    $
    12,260Net income per share  before cumulative
effect
    
    $
    .09
    
    
    $
    .19
    
    
    $
    .81
    
    
    $
    .65
    
    
    $
    .94Cumulative effect
    
    
    (.01
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income per share  basic
    
    $
    .08
    
    
    $
    .19
    
    
    $
    .81
    
    
    $
    .65
    
    
    $
    .94Net income (loss) per share  diluted
    
    $
    .08
    
    
    $
    .19
    
    
    $
    .79
    
    
    $
    .64
    
    
    $
    .93Weighted average common shares  basic
    
    
    6,560,000
    
    
    
    7,396,880
    
    
    
    8,797,529
    
    
    
    11,120,204
    
    
    
    13,075,560Weighted average common shares  diluted
    
    
    6,560,000
    
    
    
    7,491,778
    
    
    
    9,102,181
    
    
    
    11,283,265
    
    
    
    13,208,746Statement of Cash Flows Data:Cash provided by (used in) operating
activities
    
    $
    1,014
    
    
    $
    3,684
    
    
    $
    16,323
    
    
    $
    38,333
    
    
    $
    52,445Cash provided by (used in) investing
activities
    
    
    464
    
    
    
    (8,878
    )
    
    
    (39,549
    )
    
    
    (130,573
    )
    
    
    (194,998
    )Cash provided by (used in) financing
activities
    
    
    (1,385
    )
    
    
    5,419
    
    
    
    24,756
    
    
    
    94,807
    
    
    
    143,500Balance Sheet Data (at end of period):Oil and natural gas properties, net
    
    $
    27,660
    
    
    $
    35,957
    
    
    $
    58,927
    
    
    $
    157,300
    
    
    $
    319,459Total assets
    
    
    31,501
    
    
    
    40,991
    
    
    
    81,103
    
    
    
    210,322
    
    
    
    395,340Long-term debt, including current portion
    
    
    6,690
    
    
    
    3,762
    
    
    
    1,756
    
    
    
    41,820
    
    
    
    125,734Shareholders equity
    
    
    22,619
    
    
    
    32,407
    
    
    
    61,225
    
    
    
    131,481
    
    
    
    208,926
 
 1
    
    Production and severance taxes in 2006 and
2007 reflect severance tax refunds of $1.4 million and $518,000, respectively,
received or accrued during the year.  34




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operation.
 Summary Operating and Reserve Data
  Year Ended December 31,2003
    
    
    2004
    
    
    2005
    
    
    2006
    
    
    2007Production:Oil (MBbls)
    
    
    35
    
    
    
    30
    
    
    
    48
    
    
    
    69
    
    
    
    127Natural gas (MMcf)
    
    
    917
    
    
    
    1,049
    
    
    
    1,930
    
    
    
    3,915
    
    
    
    7,974Gas equivalent (MMcfe)
    
    
    1,124
    
    
    
    1,231
    
    
    
    2,220
    
    
    
    4,327
    
    
    
    8,735Average daily (MMcfe)
    
    
    3.08
    
    
    
    3.37
    
    
    
    6.08
    
    
    
    11.9
    
    
    
    23.9Average Sales Price:Oil (per Bbl)Wellhead price
    
    $
    30.41
    
    
    $
    40.83
    
    
    $
    53.35
    
    
    $
    63.22
    
    
    $
    71.08Effect of hedges
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1.97
    )Total
    
    $
    30.41
    
    
    $
    40.83
    
    
    $
    53.35
    
    
    $
    63.22
    
    
    $
    69.11Natural gas (per Mcf)Wellhead price
    
    $
    5.21
    
    
    $
    6.15
    
    
    $
    8.52
    
    
    $
    6.79
    
    
    $
    7.00Effect of hedges
    
    
    (0.48
    )
    
    
    
    
    
    
    
    
    
    
    0.24
    
    
    
    0.41Total
    
    $
    4.73
    
    
    $
    6.15
    
    
    $
    8.52
    
    
    $
    7.03
    
    
    $
    7.41Average sales price (per Mcfe)
    
    $
    4.79
    
    
    $
    6.25
    
    
    $
    8.57
    
    
    $
    7.37
    
    
    $
    7.77Operating and Overhead Costs (per Mcfe):Lease operating expenses
    
    $
    .74
    
    
    $
    1.03
    
    
    $
    .93
    
    
    $
    1.04
    
    
    $
    1.03Production and severance taxes
    
    
    .34
    
    
    
    .42
    
    
    
    .56
    
    
    
    .11
    
    
    
    .31General and administrative
    
    
    1.40
    
    
    
    1.61
    
    
    
    1.53
    
    
    
    1.35
    
    
    
    1.00Total
    
    $
    2.48
    
    
    $
    3.06
    
    
    $
    3.02
    
    
    $
    2.50
    
    
    $
    2.34Cash Operating Margin (per Mcfe)
    
    $
    2.31
    
    
    $
    3.19
    
    
    $
    5.55
    
    
    $
    4.87
    
    
    $
    5.43Other (per Mcfe):Depreciation, depletion and amortization  oil and
natural gas production
    
    $
    1.08
    
    
    $
    1.28
    
    
    $
    1.58
    
    
    $
    1.59
    
    
    $
    1.88Estimated Net Proved Reserves (as of period-end):Natural gas (Bcf)
    
    
    45.0
    
    
    
    56.9
    
    
    
    150.0
    
    
    
    236.9
    
    
    
    406.3Oil (MMbls)
    
    
    1.3
    
    
    
    1.2
    
    
    
    2.0
    
    
    
    2.7
    
    
    
    4.7Total (Bcfe)
    
    
    53.0
    
    
    
    64.3
    
    
    
    161.7
    
    
    
    253.0
    
    
    
    434.5Estimated Future Net Revenues ($MM)(1)(2)
    
    $
    178.3
    
    
    $
    211.3
    
    
    $
    692.9
    
    
    $
    519.5
    
    
    $
    1,896.3Present Value ($MM)(1)(2)
    
    $
    71.2
    
    
    $
    82.0
    
    
    $
    245.0
    
    
    $
    173.3
    
    
    $
    592.8Standardized measure of discounted future net cash
flows ($MM)(3)
    
    $
    48.0
    
    
    $
    63.3
    
    
    $
    185.5
    
    
    $
    134.4
    
    
    $
    427.7
 
 1
    
    See Item 1 Business  Certain Technical
Terms.2
    
    The prices used in calculating Estimated Future
Net Revenues and the Present Value are determined using prices as of period
end. Estimated Future Net Revenues and the Present Value give no effect to
federal or state income taxes attributable to estimated future net revenues.
See Item 1 Business  Reserves.3
    
    The standardized measure of discounted future
net cash flows gives effect to federal and state income taxes attributable to
estimated future net revenues. See Note M  Supplemental Information on Oil
and Natural Gas Operations.  35




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##### Table of Contents



Results of Operations for the Year Ended December 31, 2007 Compared to the Year Ended December
31, 2006
 Oil and Natural Gas Sales
 Lease Operations
 Production and Severance Taxes
 Depreciation, Depletion and Amortization.
 Interest
 General And Administrative Expense.
  36




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##### Table of Contents



Income Taxes
 Net Income and Net Income Per Share.
 Results of Operations for the Year Ended December 31, 2006 Compared to the Year Ended December
31, 2005
 Oil and Natural Gas Sales
 Lease Operations
 Production and Severance Taxes
 Depreciation, Depletion and Amortization.
 Interest
 General And Administrative Expense.
  37




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##### Table of Contents



Income Taxes
 Net Income and Net Income Per Share.
 Capital Resources and Liquidity
  Cash FlowYear Ended December 31, 2007 Compared to Year Ended December 31, 2006.
 Cash FlowYear Ended December 31, 2006 Compared to Year Ended December 31, 2005.
  38




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##### Table of Contents



Revolving Bank Credit Facility
   
    
    Maintain a current ratio (as defined in the loan agreement) of not less
than 1 to 1;
    
    Maintain a minimum net worth of $136 million as of December 31, 2007
adjusted annually to add 50% of our net income for the prior fiscal year and 100% of
net proceeds of equity offerings;
    
    Maintain on a quarterly basis a rolling four quarter ratio of EBITDA to
cash interest expense and preferred dividends of not less than 3 to 1;
    
    Maintain a hedging program on mutually acceptable terms whenever the loan
amount outstanding exceeds 75% of the Borrowing Base;
    
    Pay all accounts payable within 60 days of the due date other than those
being contested in good faith;
    
    Not incur any other debt other than up to $30 million of our secured notes
described below, our 9.25% Preferred Stock and our $125 million of 5.00% Convertible
Senior Notes due 2013;
    
    Not permit any liens other than those permitted by the loan agreement;
    
    Not make any investments, loans or advances other than as permitted by the
loan agreement, which includes permitted investment in Diamond Blue Drilling for no
more than three drilling rigs;
  39




---



##### Table of Contents




    
    Not engage in any mergers or consolidations or sales of all or
substantially all of our assets;
    
    Not pay any dividends on common stock or make any other distributions with
respect to our stock, including stock repurchases;
    
    Not permit Ken L. Kenworthy Jr. to cease being our chief executive
officer, other than by reason of his death or disability if we name a successor
acceptable to the lenders within four months;
    
    Not permit a person or group (other than existing management) to acquire
more than 50% of the outstanding common stock or otherwise suffer a change in control;
and
    
    Not to make any cash payments in respect of interest or on account of the
conversion, purchase, acquisition or termination of our 5.00% Convertible Senior Notes
due 2013 unless no event of default under the loan agreement exists or the payment
would not result in such a default and the Borrowing Base has not been exceeded.
   Secured Notes
  
    
    The ratio of Adjusted PV10 (as defined in the Note Agreement based on
prescribed pricing and other parameters, which prescribes prices for oil production to
be the lesser of the NYMEX strip price or $50.00 and for gas production of a fixed
$6.50 per mcf) to Total Debt at the end of each quarter may not be less than 1.5 to 1;
  40




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##### Table of Contents




    
    The ratio of Total Debt to EBITDA for the immediately preceding four
quarters may not be greater than 4.0 to 1;
    
    The ratio of EBITDA to cash interest expense (which is defined to include
dividends on outstanding preferred stock) for the immediately preceding four quarters
may not be less than 2.5 to 1;
    
    Tangible net worth may not be less than $136 million as of March 31, 2007
plus 50% of net income and 100% of net cash proceeds from the sale of equity securities
thereafter;
    
    We may not incur senior bank debt in excess of $125 million without the
consent of the Noteholders;
    
    Neither the Company nor any subsidiaries may incur any liens other than
under the Companys senior bank loan agreement and the Secured Notes, other than
certain permitted liens;
    
    We may not issue Secured Notes in excess of the Series A Notes without the
consent of Prudential and pro forma compliance with the financial covenants, which
additional debt would also require the consent of our Lender under the senior revolving
bank credit facility;
    
    We may not incur any other indebtedness without pro forma compliance with
the financial covenants, and without subordination terms satisfactory to Prudential,
which additional debt would also require the consent of our Lender
under the senior revolving bank credit facility. In this regard, Prudential agreed that we
could issue our 5.00% Senior Convertible Notes due 2013; provided no cash payments in
respect of interest on such notes or on account of the conversion, purchase,
acquisition, cancellation or termination of such notes may be made by us unless after
giving effect thereto (a) no event of default under the Note Agreement exists, and (b)
no event exists that, with the giving of notice, the passage of time or the
satisfaction of other conditions precedent, would be an event of default under the Note
Agreement;
    
    We are required to maintain commodity price hedges with a term of not
greater than three years and with notional amounts (i) greater than 25% of projected
production for the following 12 months from proved developed producing reserves and
(ii) not more than the lesser of (a) 75% of projected production for the following 12
months from all proved reserves or (b) 90% of projected production for the following 12
months from proved developed reserves; and
    
    We may not issue any additional redeemable preferred stock without the
consent of Noteholders, which would also require the consent of our Lender under the
senior revolving bank credit facility.
  41




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##### Table of Contents



2007 Common Stock Offering
 Common Stock
 Convertible Notes
     
    
    during any fiscal quarter commencing after March 31, 2008 if the last
reported sale price of the common stock for at least 20 trading days during a period of
30 consecutive trading days ending on the last trading day of the preceding fiscal
quarter is greater than or equal to 130% of the applicable conversion price on each
such trading day;
    
    during the five business-day period after any five consecutive trading-day
period (the measurement period) in which the trading price (as defined below) per
$1,000 principal amount of Notes for each day of that measurement period was less than
98%
of the product of the last reported sale price of our common stock and the applicable
conversion rate on each such day;
  42




---



##### Table of Contents




    
    upon the occurrence of a corporate event pursuant to which: (1) we issue
rights to all or substantially all of the holders of our common stock entitling them to
purchase, for a period expiring within 60 days after the date of the distribution,
 shares of our common stock at a price below the average market price at the time, or
(2) we distribute to all or substantially all of the holders of our common stock our
assets, debt securities or rights to purchase our securities, if the distribution has a
per share value in excess of 10% of the last reported sale price for our common stock
at the time; or
    
    if: (1) a person or group within the meaning of Section 13(d) of the
Exchange Act acquires more than 50% of our outstanding voting stock, (2) we consummate
a recapitalization, reclassification or change of our common stock as a result of which
our common stock would be converted into or exchanged for stock, other securities,
other property or assets, (3) we consummate a share exchange, consolidation or merger
pursuant to which our common stock will be converted into cash, securities or other
property, (4) we consummate any sale, lease or other transfer in one transaction or a
series of transactions of all or substantially all of our and our subsidiaries
consolidated assets to any person other than one of our subsidiaries, (5) continuing
directors cease to constitute at least a majority of our board of directors, (6) our
shareholders approve any plan or proposal for our liquidation or dissolution, or (7)
our common stock ceases to be listed on a United States national or regional securities
exchange (any of the events described in clauses (1) through (7), a fundamental
change).
     43




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##### Table of Contents



Share Lending Agreement
    
    
    we notify the share borrower in writing of our intention to terminate the
Share Lending Agreement at any time after the entire principal amount of the Notes
ceases to be outstanding as a result of conversion, repurchase, at maturity or
otherwise;
  44




---



##### Table of Contents




    
    we and the share borrower agree to terminate the Share Lending Agreement;
    
    we elect to terminate all of the outstanding loans upon a default by the
share borrower under the Share Lending Agreement or by the guarantor under its
guarantee, including a breach by the share borrower of any of its obligations or a
breach in any material respect of any of the representations or covenants under the
Share Lending Agreement or a breach by the guarantor of the guarantee, or the
bankruptcy of the share borrower or the guarantor; or
    
    the share borrower elects to terminate all outstanding loans upon the
bankruptcy of the Company.
  
    
    not to vote any shares of the Companys common stock it has borrowed to
the extent it owns such borrowed shares; and
 
    
    to pay to us an amount equal to any cash dividends that we pay on the
borrowed shares.
  Working Capital
   45




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##### Table of Contents



Commitments and Capital Expenditures
  Payments Due by PeriodContractual Obligations
    
    Total
    
    
    Less than1 year
    
    
    1-3 years
    
    
    3-5 years
    
    
    More than5 years(in thousands)Long-term debt
    
    $
    155,000
    
    
    $
    
    
    
    $
    
    
    
    $
    30,000
    
    
    $
    125,000Operating leases
    
    
    611
    
    
    
    276
    
    
    
    335
    
    
    
    
    
    
    
    Asset retirement obligations
    
    
    3,625
    
    
    
    525
    
    
    
    56
    
    
    
    45
    
    
    
    2,99975% PVOG Financing1
    
    
    1,735
    
    
    
    182
    
    
    
    324
    
    
    
    280
    
    
    
    949Total
    
    $
    160,971
    
    
    $
    983
    
    
    $
    715
    
    
    $
    30,325
    
    
    $
    128,948
 
 1
    
    PVOG financing is payable out of 75% of
revenues from the wells financed and repayment is based on estimated production
which may vary from actual.  Liquidity and Financing Considerations
  2008 Guidance
  Critical Accounting Policies
   46




---



##### Table of Contents



Full Cost Calculations
      47




---



##### Table of Contents



Asset Retirement Obligations
 Accounting for Asset
Retirement Obligations
 Income Taxes
   48




---



##### Table of Contents



Derivative Instruments
 Accounting for Derivative Instruments and Hedging Activities
   Oil and Gas Revenues Oil and natural gas revenues are recognized when sold to a purchaser at a fixed or determinable price, when
delivery has occurred and title has transferred, and if collectibility of the revenue is probable. Delivery occurs and
title is transferred when production has been delivered to a purchasers pipeline or truck. As a result of the
numerous requirements necessary to gather information from purchasers or various measurement locations, calculate
volumes produced, perform field and wellhead allocations and distribute and disburse funds to various working interest
partners and royalty owners, the collection of revenues from oil and gas production may take up to 60 days following
the month of production. Therefore, we make accruals for revenues and accounts receivable based on estimates of our
share of production, particularly from properties that are operated by others. Since the settlement process may take 30
to 60 days following the month of actual production, our financial results include estimates of production and revenues
for the related time period. We record any differences, which we do not expect to be significant, between the actual
amounts ultimately received and the original estimates in the period they become finalized. During the course of normal operations, the Company and other joint interest owners of natural gas reservoirs will
take more or less than their respective ownership share of the natural gas volumes produced. These volumetric
imbalances are monitored over the lives of the wells production capability. If an imbalance exists at the time the
wells reserves are depleted, cash settlements are made among the joint interest owners under a variety of
arrangements. The Company follows the sales method of accounting for gas imbalances. A liability is recorded when the
Companys excess takes of natural gas volumes exceed its estimated remaining recoverable reserves. No receivables are
recorded for those wells where the Company has taken less than its ownership share of gas production. There are no
significant imbalances as of December 31, 2006 or 2007. Other
  Recently Issued Accounting Pronouncements
   49




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##### Table of Contents



Off-Balance Sheet Arrangements
  Price Risk Management
  Forward-Looking Statements
     
 Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
 Commodity Price Risk
   50




---



##### Table of Contents



RemainingNotionalNotional
    
    AmountAmount
    
    as of
    
    Fixed
    
    Put
    
    CallMaturity
    
    Per
    
    December 31,
    
    Price
    
    Fixed
    
    FixedEffective Date
    
    Date
    
    Month
    
    2007
    
    per
    
    Price
    
    PriceNatural Gas (MMBtu):2/1/2007
    
    
    12/31/2008
    
    
    
    200,000
    
    
    
    2,400,000
    
    
    $
    7.46
    
    
    
    
    
    
    
    8/1/2007
    
    
    12/31/2008
    
    
    
    100,000
    
    
    
    1,200,000
    
    
    $
    7.60
    
    
    
    
    
    
    
    1/1/2008
    
    
    12/31/2009
    
    
    
    100,000
    
    
    
    2,400,000
    
    
    
    
    
    
    $
    7.50
    
    
    $
    8.151/1/2009
    
    
    12/31/2009
    
    
    
    200,000
    
    
    
    2,400,000
    
    
    
    
    
    
    $
    7.50
    
    
    $
    9.171/1/2010
    
    
    12/31/2010
    
    
    
    300,000
    
    
    
    3,600,000
    
    
    
    
    
    
    $
    7.50
    
    
    $
    8.91Oil (Bbls):9/1/2007
    
    
    12/31/2008
    
    
    
    5,000
    
    
    
    65,000
    
    
    $
    70.00
    
    
    
    
    
    
    
    
    51




---



##### Table of Contents



Interest Rate Risk
   
 Item 8. Financial Statements and Supplementary Data.
  
 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
  
 Item 9A. Controls and Procedures.
 Controls and Procedures
  Changes in Internal Control Over Financial Reporting
   52




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##### Table of Contents



Managements Annual Report on Internal Control over Financial Reporting
   Certifications
  
 Item 9B. Other Information.
   53




---



##### Table of Contents



PART III
   54




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##### Table of Contents



PART IV
 
 Item 15. Exhibits and Financial Statement Schedules.
  1.
    
    Financial Statements: See Index to Consolidated Financial Statements and
Consolidated Financial Statement Schedule set forth on page F-1 of this report.2.
    
    Exhibits: For a list of documents filed as exhibits to this report, see the
Exhibit Index immediately preceding the Exhibits filed with this report.
  55




---



##### Table of Contents



SIGNATURES
  GMX RESOURCES INC.Dated: March 13, 2008
    By:
    /s/ James A. MerrillJames A. Merrill, Chief Financial Officer  Signatures
    
    Title
    
    Date/s/ Ken L. Kenworthy, Jr.

Ken L. Kenworthy, Jr.
    
    President and Director
(Principal Executive Officer)
    
    March 13, 2008/s/ James A. Merrill

James A. Merrill
    
    Chief Financial Officer (Principal Financial and
Accounting Officer)
    
    March 13, 2008/s/ T. J. Boismier

T. J. Boismier
    
    Director
    
    March 13, 2008/s/ Steven Craig

Steven Craig
    
    Director
    
    March 13, 2008/s/ Ken L. Kenworthy, Sr.

Ken L. Kenworthy, Sr.
    
    Director
    
    March 13, 2008/s/ Jon W. McHugh

Jon W. McHugh
    
    Director
    
    March 13, 2008
  56




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##### Table of Contents



INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 Report of Independent Registered Public Accounting Firm
    
    
    F-2Managements Annual Report on Internal Control over Financial Reporting
    
    
    F-3Consolidated Balance Sheets, December 31, 2006 and 2007
    
    
    F-4Consolidated Statements of Operations, Years Ended December 31, 2005,
2006 and 2007
    
    
    F-5Consolidated Statements of Shareholders Equity and Comprehensive
Income, Years Ended December 31, 2005, 2006 and 2007
    
    
    F-6Consolidated Statements of Cash Flows, Years Ended December 31, 2005,
2006 and 2007
    
    
    F-7Notes to Consolidated Financial Statements
    
    
    F-8
  F-1




---



##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
 Internal Control-Integrated
Framework
    Internal Control-Integrated
Framework
  
  F-2




---



##### Table of Contents



MANAGEMENTS ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
 Internal ControlIntegrated Framework
  Internal ControlIntegrated
Framework
   F-3




---



##### Table of Contents



GMX Resources Inc. and Subsidiaries
Consolidated Balance Sheets
(dollars in thousands, except share data)
 December 31,2006
    
    
    2007ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    4,960
    
    
    $
    5,907Accounts receivableinterest owners
    
    
    64
    
    
    
    906Accounts receivableoil and natural gas revenues
    
    
    5,766
    
    
    
    10,258Derivative instruments
    
    
    1,176
    
    
    
    Inventories
    
    
    373
    
    
    
    1,558Prepaid expenses and deposits
    
    
    1,285
    
    
    
    1,720Total current assets
    
    
    13,624
    
    
    
    20,349OIL AND NATURAL GAS PROPERTIES, BASED ON THE FULL COST METHODProperties being amortized
    
    
    173,050
    
    
    
    350,573Properties not subject to amortization
    
    
    1,125
    
    
    
    2,143Less accumulated depreciation, depletion, and amortization
    
    
    (16,875
    )
    
    
    (33,257
    )157,300
    
    
    
    319,459PROPERTY AND EQUIPMENT, AT COST, NET
    
    
    39,355
    
    
    
    54,957OTHER ASSETS
    
    
    43
    
    
    
    575TOTAL ASSETS
    
    $
    210,322
    
    
    $
    395,340LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Accounts payable
    
    $
    24,658
    
    
    $
    34,941Accrued expenses
    
    
    3,551
    
    
    
    3,778Revenue distributions payable
    
    
    513
    
    
    
    3,667Derivative instruments
    
    
    
    
    
    
    1,720Current maturities of long-term debt
    
    
    251
    
    
    
    4,321Total current liabilities
    
    
    28,973
    
    
    
    48,427LONG-TERM DEBT, LESS CURRENT MATURITIES
    
    
    41,569
    
    
    
    121,413OTHER LIABILITIES
    
    
    3,272
    
    
    
    4,649DEFERRED INCOME TAXES
    
    
    5,027
    
    
    
    11,925SHAREHOLDERS EQUITY:Preferred stock, par value $.001 per share, 10,000,000 shares authorized:Series A Junior Participating Preferred Stock
25,000 shares authorized, none issued and outstanding
    
    
    
    
    
    
    9.25% Series B Cumulative Preferred Stock, 3,000,000 Shares authorized,
2,000,000 shares issued and outstanding (aggregate liquidation preference
$50,000,000)
    
    
    2
    
    
    
    2Common stock, par value $.001 per shareauthorized 50,000,000 shares
issued and outstanding 11,242,136 shares in 2006 and 13,267,886 shares in 2007
    
    
    11
    
    
    
    13Additional paid-in capital
    
    
    113,266
    
    
    
    180,543Retained earnings
    
    
    17,426
    
    
    
    29,686Accumulated other comprehensive income, net of taxes
    
    
    776
    
    
    
    (1,318
    )Total shareholders equity
    
    
    131,481
    
    
    
    208,926TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    210,322
    
    
    $
    395,340
   F-4




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Consolidated Statements of Operations
(dollars in thousands, except share and per share data)
 Year Ended December 31,2005
    
    
    2006
    
    
    2007REVENUE:Oil and natural gas sales
    
    $
    19,026
    
    
    $
    31,882
    
    
    $
    67,883Interest income
    
    
    162
    
    
    
    150
    
    
    
    224Other income
    
    
    5
    
    
    
    1
    
    
    
    2Total revenue
    
    
    19,193
    
    
    
    32,033
    
    
    
    68,109EXPENSES:Lease operations
    
    
    2,070
    
    
    
    4,479
    
    
    
    8,982Production and severance taxes
    
    
    1,241
    
    
    
    465
    
    
    
    2,746Depreciation, depletion and amortization
    
    
    3,982
    
    
    
    8,046
    
    
    
    18,681Interest
    
    
    143
    
    
    
    824
    
    
    
    4,088General and administrative
    
    
    3,389
    
    
    
    5,829
    
    
    
    8,717Total expenses
    
    
    10,825
    
    
    
    19,643
    
    
    
    43,214Income before income taxes
    
    
    8,368
    
    
    
    12,390
    
    
    
    24,895INCOME TAXES
    
    
    1,212
    
    
    
    3,415
    
    
    
    8,010NET INCOME
    
    
    7,156
    
    
    
    8,975
    
    
    
    16,885Preferred stock dividends
    
    
    
    
    
    
    1,799
    
    
    
    4,625NET INCOME APPLICABLE TO COMMON STOCK
    
    $
    7,156
    
    
    $
    7,176
    
    
    $
    12,260Earnings per share  Basic
    
    $
    0.81
    
    
    $
    0.65
    
    
    $
    .94Earnings per share Diluted
    
    $
    0.79
    
    
    $
    0.64
    
    
    $
    .93Weighted average common sharesBasic
    
    
    8,797,529
    
    
    
    11,120,204
    
    
    
    13,075,560Weighted average common sharesDiluted
    
    
    9,102,181
    
    
    
    11,283,265
    
    
    
    13,208,746
   F-5




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Consolidated Statement of Shareholders Equity and Comprehensive Income
Year Ended December 31, 2005, 2006, and 2007
(dollars and shares in thousands)
 Accumu-latedotherAdditional
    
    
    
    
    
    
    compre-
    
    
    TotalPreferred
    
    
    Common
    
    
    Preferred
    
    
    Common
    
    
    paid-in
    
    
    Retained
    
    
    hensive
    
    
    shareholdersshares
    
    
    shares
    
    
    par value
    
    
    par value
    
    
    capital
    
    
    earnings
    
    
    income
    
    
    equityBALANCE AT DECEMBER 31, 2004
    
    
    
    
    
    
    8,054
    
    
    $
    
    
    
    $
    8
    
    
    $
    29,305
    
    
    $
    3,094
    
    
    $
    
    
    
    $
    32,407Options Exercised
    
    
    
    
    
    
    128
    
    
    
    
    
    
    
    
    
    
    
    423
    
    
    
    
    
    
    
    
    
    
    
    423Redeemed & Cancelled
Warrants
    
    
    
    
    
    
    (144
    )
    
    
    
    
    
    
    
    
    
    
    (774
    )
    
    
    
    
    
    
    
    
    
    
    (774
    )Warrants Exercised
    
    
    
    
    
    
    337
    
    
    
    
    
    
    
    
    
    
    
    1,667
    
    
    
    
    
    
    
    
    
    
    
    1,667Shares Issued
    
    
    
    
    
    
    1,600
    
    
    
    
    
    
    
    2
    
    
    
    20,344
    
    
    
    
    
    
    
    
    
    
    
    20,346Net Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,156
    
    
    
    
    
    
    
    7,156BALANCE AT DECEMBER 31, 2005
    
    
    
    
    
    
    9,975
    
    
    $
    
    
    
    $
    10
    
    
    $
    50,965
    
    
    $
    10,250
    
    
    $
    
    
    
    $
    61,225Stock Options Exercised
    
    
    
    
    
    
    103
    
    
    
    
    
    
    
    
    
    
    
    556
    
    
    
    
    
    
    
    
    
    
    
    556Warrants Exercised
    
    
    
    
    
    
    1,164
    
    
    
    
    
    
    
    1
    
    
    
    13,972
    
    
    
    
    
    
    
    
    
    
    
    13,973Stock Option Compensation
Expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    662
    
    
    
    
    
    
    
    
    
    
    
    662Series B Preferred Shares
Issued
    
    
    2,000
    
    
    
    
    
    
    
    2
    
    
    
    
    
    
    
    47,111
    
    
    
    
    
    
    
    
    
    
    
    47,113Preferred Stock Dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,799
    )
    
    
    
    
    
    
    (1,799
    )Net Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,975
    
    
    
    
    
    
    
    8,975Other comprehensive
income, netUnrealized
loss and hedges, net of
taxes of $718
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,396
    
    
    
    1,396Reclassification
adjustment for hedge
gains included in net
income, net of taxes of
$319
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (620
    )
    
    
    (620
    )Total comprehensive
income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,751BALANCE AT DECEMBER 31,
2006
    
    
    2,000
    
    
    
    11,242
    
    
    $
    2
    
    
    $
    11
    
    
    $
    113,266
    
    
    $
    17,426
    
    
    $
    776
    
    
    $
    131,481Stock Options Exercised
    
    
    
    
    
    
    26
    
    
    
    
    
    
    
    
    
    
    
    77
    
    
    
    
    
    
    
    
    
    
    
    77Stock Option
Compensation Expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,573
    
    
    
    
    
    
    
    
    
    
    
    1,573Preferred Stock Dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,625
    )
    
    
    
    
    
    
    (4,625
    )Shares Issued
    
    
    
    
    
    
    2,000
    
    
    
    
    
    
    
    2
    
    
    
    65,627
    
    
    
    
    
    
    
    
    
    
    
    65,629Net Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,885
    
    
    
    
    
    
    
    16,885Other comprehensive
income, netUnrealized
gain and hedges, net of
taxes of $53
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (98
    )
    
    
    (98
    )Reclassification
adjustment for hedge
gains included in net
income, net of taxes of $1,027
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,996
    )
    
    
    (1,996
    )Total comprehensive
income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,791BALANCE AT DECEMBER 31,
2007
    
    
    2,000
    
    
    
    13,268
    
    
    $
    2
    
    
    $
    13
    
    
    $
    180,543
    
    
    $
    29,686
    
    
    $
    (1,318
    )
    
    $
    208,926
   F-6




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(dollars in thousands)
 Year Ended December 31,2005
    
    
    2006
    
    
    2007CASH FLOWS DUE TO OPERATING ACTIVITIESNet income
    
    $
    7,156
    
    
    $
    8,975
    
    
    $
    16,885Adjustments to reconcile net income
to net cash provided by operating activities:Depreciation, depletion, and amortization
    
    
    3,982
    
    
    
    8,046
    
    
    
    18,681Deferred income taxes
    
    
    1,212
    
    
    
    3,415
    
    
    
    7,977Non-cash stock compensation expense
    
    
    
    
    
    
    662
    
    
    
    1,573Other
    
    
    112
    
    
    
    30
    
    
    
    273Decrease (increase) in:Accounts receivable
    
    
    (2,666
    )
    
    
    (1,567
    )
    
    
    (5,333
    )Inventory, prepaid expenses and other
assets
    
    
    (14
    )
    
    
    (1,462
    )
    
    
    (913
    )Increase (decrease) in:Accounts payable
    
    
    5,488
    
    
    
    16,849
    
    
    
    10,283Accrued expenses and other liabilities
    
    
    310
    
    
    
    3,106
    
    
    
    (298
    )Revenue distributions payable
    
    
    743
    
    
    
    279
    
    
    
    3,317Net cash provided by operating activities
    
    
    16,323
    
    
    
    38,333
    
    
    
    52,445CASH FLOWS DUE TO INVESTING ACTIVITIESPurchase of oil and natural gas properties
    
    
    (26,020
    )
    
    
    (104,412
    )
    
    
    (174,509
    )Purchase of property and equipment
    
    
    (13,529
    )
    
    
    (26,161
    )
    
    
    (20,489
    )Net cash used in investing activities
    
    
    (39,549
    )
    
    
    (130,573
    )
    
    
    (194,998
    )CASH FLOWS DUE TO FINANCING ACTIVITIESAdvance on borrowings
    
    
    10,702
    
    
    
    78,862
    
    
    
    120,139Payments on debt
    
    
    (7,608
    )
    
    
    (43,898
    )
    
    
    (66,225
    )Proceeds from sale of common stock
    
    
    21,662
    
    
    
    14,529
    
    
    
    65,706Proceeds from sale of Series B preferred stock
    
    
    
    
    
    
    47,113
    
    
    
    Dividends paid on Series B preferred stock
    
    
    
    
    
    
    (1,799
    )
    
    
    (4,625
    )Proceeds from issuance of senior secured notes
    
    
    
    
    
    
    
    
    
    
    30,000Fees paid related to financing activities
    
    
    
    
    
    
    
    
    
    
    (1,495
    )Net cash provided by financing activities
    
    
    24,756
    
    
    
    94,807
    
    
    
    143,500NET INCREASE IN CASH
    
    
    1,530
    
    
    
    2,567
    
    
    
    947CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
    
    
    863
    
    
    
    2,393
    
    
    
    4,960CASH AND CASH EQUIVALENTS AT END OF PERIOD
    
    $
    2,393
    
    
    $
    4,960
    
    
    $
    5,907SUPPLEMENTAL CASH FLOW DISCLOSURECASH PAID DURING THE PERIOD FOR:INTEREST
    
    $
    117
    
    
    $
    683
    
    
    $
    3,402INCOME TAXES
    
    $
    
    
    
    $
    
    
    
    $
    
   F-7




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
 NOTE ANATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
          F-8




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
      F-9




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
  Accounting for the Impairment or Disposal of Long Lived
Assets.
       F-10




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
 Accounting for Derivative Instruments and
Hedging Activities,
     Accounting for Asset Retirement Obligations
  F-11




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
    2005
    
    2006
    
    2007Options excluded from dilution
calculation
    
    
    77,000
    
    
    
    25,000
    
    
    
    343,000Range of exercise prices
    
    $
    20.01 - $29.00
    
    
    $
    39.65
    
    
    $
    36.83 - $39.65Weighted average exercise price
    
    $
    20.98
    
    
    $
    39.65
    
    
    $
    38.54
 Share-Based
Payment
 Accounting for Stock Issued to Employees
   F-12




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
  Year EndedDecember 31, 2005(in thousands, exceptper share amounts)Net income as reported
    
    $
    7,156Add: Stock-based compensation recognized
    
    
    163Deduct: Stock-based compensation, net of tax
    
    
    (467
    )Pro forma net earnings
    
    $
    6,852Pro forma earnings per share  basic:
    
    $
    0.78Pro forma earnings per share  diluted
    
    $
    0.75
       F-13




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
 Fair Value Measurements
 The Fair Value Option for Financial Assets and
Financial Liabilities
 Business Combinations
 Noncontrolling Interests in Consolidated Financial
Statements, an amendment of ARB No. 51
  F-14




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
  NOTE BPROPERTY AND EQUIPMENT
  December 31,2006
    
    
    2007(in thousands)Pipeline and related facilities
    
    $
    16,049
    
    
    $
    28,816Drilling rigs
    
    
    23,950
    
    
    
    29,924Machinery and equipment
    
    
    1,198
    
    
    
    2,047Buildings and leasehold improvement
    
    
    1,254
    
    
    
    1,606Office equipment
    
    
    646
    
    
    
    95843,097
    
    
    
    63,351Less accumulated depreciation and amortization
    
    
    (3,742
    )
    
    
    (8,570
    )39,355
    
    
    
    54,781Land
    
    
    
    
    
    
    176$
    39,355
    
    
    $
    54,957
 NOTE CDERIVATIVE ACTIVITIES
   F-15




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
       F-16




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
 NOTE DLONG-TERM DEBT
  2006
    
    
    2007(in thousands)Revolving bank credit facility, maturity date of July
2011 bearing a variable weighted average interest rate
of 7.45% and 6.88% as of December 31, 2006 and 2007,
respectively, collateralized by oil and natural gas
properties
    
    $
    40,000
    
    
    $
    89,860Bridge Loan, maturity date of June 2008, bearing
interest at prime rate plus 2.25% (effective rate of
9.5% at December 31, 2007)
    
    
    
    
    
    
    4,140Joint venture financing (non-recourse, no interest rate)
    
    
    1,820
    
    
    
    1,734Series A Senior Subordinated Secured Notes due July
2012 with a fixed interest rate of 7.58% and secured by
a second lien on all assets of GMX
    
    
    
    
    
    
    30,00041,820
    
    
    
    125,734Less current maturities
    
    
    251
    
    
    
    4,321$
    41,569
    
    
    $
    121,413
  Year
    
    Amount(in thousands)2008
    
    $
    4,3212009
    
    
    1692010
    
    
    1552011
    
    
    90,004Thereafter
    
    
    31,085$
    125,734
 Revolving Bank Credit Facility
   F-17




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
  Joint Venture Financing
  Secured Notes
   F-18




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
  NOTE E  ASSET RETIREMENT OBLIGATIONS
  2006
    
    
    2007(in thousands)Beginning balance
    
    $
    2,212
    
    
    $
    2,163Liabilities incurred
    
    
    337
    
    
    
    1,188Accretion(1)
    
    
    82
    
    
    
    178Revisions(2)
    
    
    (468
    )
    
    
    96Ending balance
    
    
    2,163
    
    
    
    3,625Less current portion(3)
    
    
    
    
    
    
    525$
    2,163
    
    
    $
    3,100
 
 1
    
    Annual accretion is added to the full cost
pool.2
    
    2006 revisions were due to a decrease in the
current inflation rate and an increase in the current interest rate. 2007
revisions were due to increases in the current inflation rate and interest
rate.3
    
    Current portion included in accrued expenses
in the consolidated balance sheets.   F-19




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
 NOTE FINCOME TAXES
  2005
    
    
    2006
    
    
    2007(in thousands)Current tax expense
    
    $
    
    
    
    $
    
    
    
    $
    33Deferred tax expense
    
    
    1,212
    
    
    
    3,415
    
    
    
    7,977$
    1,212
    
    
    $
    3,415
    
    
    $
    8,010
  2005
    
    2006
    
    2007U.S. statutory tax rate
    
    
    34
    %
    
    
    34
    %
    
    
    34
    %Statutory depletion
    
    
    (12
    )
    
    
    (4
    )
    
    
    (4
    )Change in valuation allowance
    
    
    (8
    )
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    (2
    )
    
    
    2Effective income tax rate
    
    
    14
    %
    
    
    28
    %
    
    
    32
    %
   2006
    
    
    2007(in thousands)Deferred tax assets:Net operating loss carryforwards
    
    $
    9,455
    
    
    $
    10,561Statutory depletion carryforwards
    
    
    2,722
    
    
    
    3,627Stock option compensation expense
    
    
    120
    
    
    
    311Unrealized loss on derivative instrument
    
    
    
    
    
    
    680Total
    
    
    12,297
    
    
    
    15,179Deferred tax liabilities:Property, plant and equipment
    
    
    (16,924
    )
    
    
    (27,104
    )Unrealized gain on derivative instrument
    
    
    (400
    )
    
    
    Total
    
    
    (17,324
    )
    
    
    (27,104
    )Net deferred tax liability
    
    $
    (5,027
    )
    
    $
    (11,925
    )
  F-20




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
   NOTE GCOMMITMENTS AND CONTINGENCIES
    Year Ending December 31:2008
    
    $
    276,0002009
    
    
    275,0002010
    
    
    60,000Total
    
    $
    611,000
  F-21




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
 NOTE HSTOCK OPTION PLAN
     Number of
    
    
    Weighted averageshares
    
    
    exercise priceBalance as of December 31, 2004
    
    
    314,000
    
    
    $
    3.67Granted
    
    
    137,000
    
    
    
    16.58Exercised
    
    
    (128,250
    )
    
    
    2.69Balance as of December 31, 2005
    
    
    322,750
    
    
    $
    8.65Granted
    
    
    53,000
    
    
    
    35.31Exercised
    
    
    (102,500
    )
    
    
    5.42Forfeited
    
    
    (3,000
    )
    
    
    27.91Balance as of December 31, 2006
    
    
    270,250
    
    
    $
    14.89Granted
    
    
    336,000
    
    
    
    38.14Exercised
    
    
    (25,750
    )
    
    
    3.00Forfeited
    
    
    (6,000
    )
    
    
    31.27Balance as of December 31, 2007
    
    
    574,500
    
    
    $
    28.86
   F-22




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
         NOTE ICAPITAL STOCK
    F-23




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
    NOTE JFINANCIAL INSTRUMENTS AND CONCENTRATIONS OF CREDIT RISK
      F-24




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
   2005
    
    2006
    
    2007OilVarious purchasers through PVOG
    
    
    27
    %
    
    
    44
    %
    
    
    44
    %Teppco Crude
    
    
    65
    %
    
    
    48
    %
    
    
    55
    %Natural GasCrossTex Energy Services, Inc.
    
    
    44
    %
    
    
    42
    %
    
    
    52
    %Various purchasers through PVOG
    
    
    48
    %
    
    
    48
    %
    
    
    45
    %
  NOTE KRETIREMENT PLANS
  NOTE LOIL AND NATURAL GAS OPERATIONS
  2005
    
    
    2006
    
    
    2007(in thousands)Property acquisition costs  unproved
    
    $
    1,256
    
    
    $
    598
    
    
    $
    1,018Development costs
    
    
    25,211
    
    
    
    104,657
    
    
    
    177,523$
    26,467
    
    
    $
    105,255
    
    
    $
    178,541
  F-25




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
    2005
    
    
    2006
    
    
    2007(in thousands)Oil and natural gas sales
    
    $
    19,026
    
    
    $
    31,882
    
    
    $
    67,883Production costs
    
    
    (3,311
    )
    
    
    (4,944
    )
    
    
    (11,728
    )Depreciation, depletion and
amortization
    
    
    (3,497
    )
    
    
    (6,882
    )
    
    
    (16,382
    )Income tax expense
    
    
    (1,212
    )
    
    
    (3,415
    )
    
    
    (8,010
    )Results of operations for oil and
natural gas producing activities
    
    $
    11,006
    
    
    $
    16,641
    
    
    $
    31,763
  NOTE MSUPPLEMENTAL INFORMATION ON OIL AND NATURAL GAS OPERATIONS (UNAUDITED)
    F-26




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
 OIL
    
    GAS(MBBLS)
    
    (MMCF)December 31, 2005Proved reserves, beginning of period
    
    
    1,237
    
    
    
    56,922Extensions, discoveries, and other additions
    
    
    694
    
    
    
    84,026Production
    
    
    (48
    )
    
    
    (1,930
    )Revisions of previous estimates
    
    
    84
    
    
    
    10,951Proved reserves, end of period
    
    
    1,967
    
    
    
    149,969Proved developed reserves:Beginning of period
    
    
    584
    
    
    
    18,978End of period
    
    
    764
    
    
    
    41,161December 31, 2006Proved reserves, beginning of period
    
    
    1,967
    
    
    
    149,969Extensions, discoveries, and other additions
    
    
    831
    
    
    
    87,754Production
    
    
    (69
    )
    
    
    (3,915
    )Revisions of previous estimates
    
    
    (36
    )
    
    
    3,042Proved reserves, end of period
    
    
    2,693
    
    
    
    236,850Proved developed reserves:Beginning of period
    
    
    764
    
    
    
    41,161End of period
    
    
    932
    
    
    
    69,279December 31, 2007Proved reserves, beginning of period
    
    
    2,693
    
    
    
    236,850Extensions, discoveries, and other additions
    
    
    2,019
    
    
    
    185,730Production
    
    
    (127
    )
    
    
    (7,974
    )Revisions of previous estimates
    
    
    108
    
    
    
    (8,264
    )Proved reserves, end of period
    
    
    4,693
    
    
    
    406,342Proved developed reserves:Beginning of period
    
    
    932
    
    
    
    69,279End of period
    
    
    1,776
    
    
    
    144,164
    F-27




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
   2005
    
    
    2006
    
    
    2007(in thousands)Future cash inflows
    
    $
    1,211,564
    
    
    $
    1,337,671
    
    
    $
    3,549,360Future production costs
    
    
    (327,958
    )
    
    
    (508,221
    )
    
    
    (1,097,465
    )Future development costs
    
    
    (190,700
    )
    
    
    (309,907
    )
    
    
    (555,623
    )Future income tax provisions
    
    
    (168,275
    )
    
    
    (116,610
    )
    
    
    (528,126
    )Net future cash inflows
    
    
    524,631
    
    
    
    402,933
    
    
    
    1,368,146Less effect of a 10% discount factor
    
    
    (339,111
    )
    
    
    (268,499
    )
    
    
    (940,416
    )Standardized measure of
discounted
future net cash flows
    
    $
    185,520
    
    
    $
    134,434
    
    
    $
    427,730
   F-28




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
  2005
    
    
    2006
    
    
    2007(in thousands)Standardized measure, beginning of year
    
    $
    63,320
    
    
    $
    185,520
    
    
    $
    134,434Sales of oil and natural gas, net of
production costs
    
    
    (15,714
    )
    
    
    (26,938
    )
    
    
    (53,131
    )Net changes in prices and production costs
    
    
    6,850
    
    
    
    (110,559
    )
    
    
    182,156Change in estimated future development costs
    
    
    (2,698
    )
    
    
    (38,708
    )
    
    
    75,335Extensions and discoveries, net of future
development costs
    
    
    132,571
    
    
    
    62,948
    
    
    
    172,308Previously estimated development cost
incurred
    
    
    23,629
    
    
    
    104,707
    
    
    
    30,977Revisions of quantity estimates
    
    
    25,836
    
    
    
    13,360
    
    
    
    (17,257
    )Accretion of discount
    
    
    39,647
    
    
    
    22,676
    
    
    
    54,192Changes in timing of production and other
    
    
    (48,413
    )
    
    
    (91,507
    )
    
    
    (25,081
    )Net changes in income taxes
    
    
    (39,508
    )
    
    
    12,935
    
    
    
    (126,203
    )Standardized measure, end of year
    
    $
    185,520
    
    
    $
    134,434
    
    
    $
    427,730
 NOTE NQUARTERLY FINANCIAL DATA (UNAUDITED)
  First
    
    Second
    
    Third
    
    FourthQuarter
    
    Quarter
    
    Quarter
    
    Quarter
    
    Total(in thousands, except per share data)2007Revenues
    
    $
    13,253
    
    
    $
    16,519
    
    
    $
    17,098
    
    
    $
    21,239
    
    
    $
    68,109Income before income taxes
    
    
    5,390
    
    
    
    6,799
    
    
    
    5,974
    
    
    
    6,732
    
    
    
    24,895Net income
    
    
    3,814
    
    
    
    4,637
    
    
    
    3,561
    
    
    
    4,873
    
    
    
    16,885Net income applicable to common stock
    
    
    2,658
    
    
    
    3,481
    
    
    
    2,404
    
    
    
    3,717
    
    
    
    12,260Basic earnings per share1
    
    
    .21
    
    
    
    .26
    
    
    
    .18
    
    
    
    .28
    
    
    
    .94Diluted earnings per share1
    
    
    .21
    
    
    
    .26
    
    
    
    .18
    
    
    
    .28
    
    
    
    .932006Revenues
    
    $
    6,716
    
    
    $
    6,494
    
    
    $
    8,534
    
    
    $
    10,289
    
    
    $
    32,033Income before income taxes
    
    
    2,780
    
    
    
    1,942
    
    
    
    3,905
    
    
    
    3,763
    
    
    
    12,390Net income
    
    
    2,134
    
    
    
    1,592
    
    
    
    2,861
    
    
    
    2,388
    
    
    
    8,975Net income applicable to common stock
    
    
    2,134
    
    
    
    1,592
    
    
    
    2,219
    
    
    
    1,231
    
    
    
    7,176Basic earnings per share1
    
    
    0.20
    
    
    
    0.14
    
    
    
    0.20
    
    
    
    0.11
    
    
    
    0.65Diluted earnings per share1
    
    
    0.19
    
    
    
    0.14
    
    
    
    0.19
    
    
    
    0.11
    
    
    
    0.64
 
 1
    
    The sum of the per share amounts per quarter
does not equal the year due to the changes in the average number of common
shares outstanding  F-29




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##### Table of Contents



GMX Resources Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2005, 2006 and 2007
 NOTE O  SUBSEQUENT EVENT  CONVERTIBLE NOTE OFFERING
   F-30




---



##### Table of Contents



EXHIBIT INDEX
 Incorporated by ReferenceExhibit
    
    
    
    
    
    SEC
    
    
    
    
    
    
    
    FiledNo.
    
    Exhibit Description
    
    Form
    
    File No.
    
    Exhibit
    
    Filing Date
    
    Herewith3.1
    
    
    Amended and Restated Certificate
of Incorporation of GMX Resources
Inc.
    
    SB-2
    
    353-49328
    
    
    3.1
    
    
    11/06/20003.2
    
    
    Amended Bylaws of GMX Resources
Inc
    
    10-QSB
    
    000-32325
    
    
    3.2
    
    
    11/08/20043.3
    
    
    Certificate of Designation of
Series A Junior Participating
Preferred Stock of GMX Resources
Inc.
    
    8-K
    
    000-32325
    
    
    3.1
    
    
    05/18/20053.4
    
    
    Certificate of Designation of
9.25% Series B Cumulative
Preferred Stock
    
    8-A12B
    
    001-32977
    
    
    4.1
    
    
    08/08/20064.1
    (a)
    
    Rights Agreement dated May 17,
2005 by and between GMX Resources
Inc. and UMB Bank, N.A., as
Rights Agent
    
    8-K
    
    000-32325
    
    
    4.1
    
    
    05/18/20054.1
    (b)
    
    Amendment No. 1 to Rights
Agreement dated February 1, 2008
    
    8-A/A
    
    001-32977
    
    
    4.1
    
    
    02/21/20084.2
    
    
    Indenture dated February 15,
2008, between GMX Resources Inc.
and The Bank of New York Trust
Company, N.A., as trustee
    
    8-K
    
    001-32977
    
    
    4.1
    
    
    02/15/200810.1
    
    
    Amended and Restated Stock Option
Plan
    
    10-Q
    
    001-32977
    
    
    10.1
    
    
    11/09/200710.2
    
    
    Form of Director Indemnification
Agreement
    
    SB-2
    
    333-49328
    
    
    10.5
    
    
    11/06/200010.3
    
    
    Participation Agreement dated
December 29, 2003 by and among
Penn Virginia Oil & Gas Company,
the Company and its wholly owned
subsidiaries
    
    8-K
    
    000-32325
    
    
    10.1
    
    
    12/31/200310.3
    (a)
    
    First Amendment dated February
27, 2004 to Participation
Agreement between GMX Resources
Inc. and Penn Virginia Oil & Gas
Corporation
    
    8-K
    
    000-32325
    
    
    10.1
    
    
    09/14/200410.3
    (b)
    
    Second Amendment dated May 9,
2004 to Participation Agreement
between GMX Resources Inc. and
Penn Virginia Oil & Gas
Corporation
    
    8-K
    
    000-32325
    
    
    10.2
    
    
    09/14/2004
  E-1




---



##### Table of Contents



Incorporated by ReferenceExhibit
    
    
    
    
    
    SEC
    
    
    
    
    
    
    
    FiledNo.
    
    Exhibit Description
    
    Form
    
    File No.
    
    Exhibit
    
    Filing Date
    
    Herewith10.3
    (c)
    
    Third Amendment dated April 6,
2004 to Participation Agreement
between GMX Resources Inc. and
Penn Virginia Oil & Gas
Corporation
    
    8-K
    
    000-32325
    
    
    10.3
    
    
    09/14/200410.3
    (d)
    
    Fourth Amendment dated August 11,
2004 to Participation Agreement
between GMX Resources Inc. and
Penn Virginia Oil & Gas
Corporation
    
    8-K
    
    000-32325
    
    
    10.4
    
    
    09/14/200410.3
    (e)
    
    Fifth Amendment dated effective
January 1, 2005 to Participation
Agreement between GMX Resources
Inc. and Penn Virginia Oil & Gas
L.P., successor to Penn Virginia
Oil & Gas Corporation
    
    10-QSB
    
    000-32325
    
    
    10.6
    (e)
    
    05/12/200510.3
    (f)
    
    Sixth Amendment dated effective
January 1, 2006, to Participation
Agreement between GMX Resources
Inc. and Penn Virginia Oil & Gas
L.P., successor to Penn Virginia
Oil & Gas Corporation
    
    8-K
    
    000-32325
    
    
    10.1
    
    
    01/20/200610.4
    (a)
    
    Second Amended and Restated Loan
Agreement dated October 31, 2007
between GMX Resources Inc.,
Capital One, National
Association, and Union Bank of
California, N.A.
    
    8-K
    
    001-32977
    
    
    10.1
    
    
    11/02/200710.4
    (b)
    
    First Amendment to Loan Agreement
dated December 19, 2007 between
GMX Resources Inc., Capital One,
National Association, and Union
Bank of California, N.A.
    
    8-K
    
    001-32977
    
    
    10.1
    
    
    12/21/200710.4
    (c)
    
    Second Amendment to Loan
Agreement dated February 11, 2008
among GMX Resources Inc., Capital
One, National Association, and
Union Bank of California, N.A.
    
    8-K
    
    001-32977
    
    
    10.5
    
    
    02/15/200810.5
    (a)
    
    Note Purchase Agreement dated
July 31, 2007 between GMX
Resources Inc. and The Prudential
Insurance Company of America
    
    10-Q
    
    001-32977
    
    
    10.6
    (a)
    
    08/09/200710.5
    (b)
    
    Intercreditor Agreement dated
July 31, 2007 between the
Noteholders, Capital One,
National Association, Union Bank
of California, N.A. and The Bank
of New York Trust Company, N.A.,
as collateral agent
    
    10-Q
    
    001-32977
    
    
    10.6
    (b)
    
    08/09/2007
  E-2




---



##### Table of Contents



Incorporated by ReferenceExhibit
    
    
    
    
    
    SEC
    
    
    
    
    
    
    
    FiledNo.
    
    Exhibit Description
    
    Form
    
    File No.
    
    Exhibit
    
    Filing Date
    
    Herewith10.5
    (c)
    
    Amendment No. 1 to Note Purchase
Agreement and Limited Consent
dated February 11, 2008 between
GMX Resources Inc. and The
Prudential Insurance Company of
America
    
    8-K
    
    001-32977
    
    
    10.6
    
    
    02/15/200810.6
    
    
    Gas Gathering and Processing
Agreement effective January 31,
2008 between PVR East Texas Gas
Processing LLC and GMX Resources
Inc.
    
    8-K
    
    001-32977
    
    
    10.1
    
    
    02/01/200810.7
    
    
    Purchase Agreement dated February
11, 2008, between GMX Resources
Inc. and Jefferies & Company,
Inc., as representative of the
Initial Purchasers named therein
    
    8-K
    
    001-32977
    
    
    10.1
    
    
    02/15/200810.8
    
    
    Registration Rights Agreement
dated February 15, 2008, between
GMX Resources Inc. and Jefferies
& Company, Inc. as representative
of the Initial purchasers named
therein
    
    8-K
    
    001-32977
    
    
    10.2
    
    
    02/15/200810.9
    
    
    Share Lending Agreement dated
February 11, 2008, between GMX
Resources Inc., Jefferies Funding
LLC and Jefferies & Company,
Inc., as collateral agent
    
    8-K
    
    001-32977
    
    
    10.3
    
    
    02/15/200810.10
    
    
    Registration Rights Agreement
dated February 11, 2008, between
GMX Resources Inc.and Jefferies
Funding LLC
    
    8-K
    
    001-32977
    
    
    10.4
    
    
    02/15/200814
    
    
    Code of Business Conduct and
Ethics
    
    10-KSB/A
    
    000-32325
    
    
    14
    
    
    04/15/200421
    
    
    List of Subsidiaries
    
    10-KSB
    
    000-32325
    
    
    21
    
    
    03/31/200623.1
    
    
    Consent of Independent Accountants
    
    
    
    001-32977
    
    
    
    
    
    
    
    *23.2
    
    
    Consent of MHA Petroleum
Consultants
    
    
    
    001-32977
    
    
    
    
    
    
    
    *31.1
    
    
    Rule 13a-14(a) Certification of
Chief Executive Officer
    
    
    
    001-32977
    
    
    
    
    
    
    
    *31.2
    
    
    Rule 13(a)  14(a) Certification
of Chief Financial Officer
    
    
    
    001-32977
    
    
    
    
    
    
    
    *32.1
    
    
    Certification of Chief Executive
Officer pursuant to 18 U.S.C. §
1350
    
    
    
    001-32977
    
    
    
    
    
    
    
    *32.2
    
    
    Certification of Chief Financial
Officer pursuant to 18 U.S.C. §
1350
    
    
    
    001-32977
    
    
    
    
    
    
    
    *
  E-3