www.EXFILE.com 888.775-4789 -- GMX RESOURCES, INC. -- EXHIBIT 4.1 TO FORM 8-A12B


    EXHIBIT
      4.1

     

    CERTIFICATE
      OF DESIGNATION

    OF
      THE

    9.25%
      SERIES B CUMULATIVE PREFERRED STOCK

    $0.001
      PAR VALUE

    OF

    GMX
      RESOURCES INC.

     

    Pursuant
      to Section 1032 of the Oklahoma General Corporation Act,

     

    The
      undersigned, the Chief Executive Officer of GMX
      Resources Inc.,
      an
      Oklahoma corporation (the "Corporation"), does hereby certify that the following
      resolution was duly adopted by the Board of Directors of the Corporation on
      August 7, 2006, pursuant to the provisions of Section 1032.A of the Oklahoma
      General Corporation Act (the "Act"):

     

    RESOLVED,
      that pursuant to authority expressly granted to and vested in the Board of
      Directors by the provisions of the Certificate
      of Incorporation of the Corporation (the "Certificate of Incorporation"), the
      issuance of a series of the preferred stock, par value $0.001 per share, of
      the
      Corporation to be designated "9.25% Series B Cumulative Preferred Stock," which
      shall consist of 3,000,000 shares of preferred stock that the Corporation now
      has authority to issue, be, and the same hereby is, authorized, and the powers,
      designations, preferences and rights, and the qualifications, limitations or
      restrictions of the shares of such series (in addition to the rights and
      limitations set forth in the Certificate of Incorporation that may be applicable
      to such series) are fixed as follows:

     

    Section
      1.  Number
      of Shares and Designation. 
      This series of Preferred Stock shall be designated as 9.25% Series B Cumulative
      Preferred Stock, $0.001 par value per share (the "Series B Preferred Shares"),
      and the number of shares which shall constitute such series shall be
      3,000,000.

     

    Section
      2.  Definitions.  
      For purposes of the Series B Preferred Shares, the following terms shall have
      the meanings indicated:

     

    "Board
      of Directors"
      shall
      mean the Board of Directors of the Corporation or any committee authorized
      by
      such Board of Directors to perform any of its responsibilities with respect
      to
      the Series B Preferred Shares.

     

    "Business
      Day"
      shall
      mean any day other than a Saturday, Sunday or a day on which state or federally
      chartered banking institutions in New York, New York are not required to be
      open.

     

    "Call
      Date"
      shall
      mean the date fixed for redemption of the Series B Preferred Shares and
      specified in the notice to holders required under paragraph (f)
      of
Section
      5
      as the
      Call Date.

     

    A
      "Change
      of Ownership or Control"
      shall
      be deemed to have occurred on the date (i) that a "person" or "group"
      (within the meaning of Sections 13(d) and 14(d) of the Exchange Act)
      becomes the ultimate "beneficial owner" (as defined in Rules 13d-3 and 13d-5
      under the Exchange Act, except that a person or group shall be deemed to have
      beneficial ownership of all

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    shares
      of
      Voting Stock that such person or group has the right to acquire regardless
      of
      when such right is first exercisable), directly or indirectly, of Voting Stock
      representing more than 50% of the total voting power of the total Voting Stock
      of the Corporation; (ii) that the Corporation sells, transfers or otherwise
      disposes of all or substantially all of its assets; (iii) that the
      Corporation permits or suffers a change in its key management, meaning the
      continued active full time employment of each of Ken Kenworthy, Jr. (as Chief
      Executive Officer) and Ken Kenworthy, Sr. (as Chief Financial Officer);
      provided, however, that the cessation of active employment of one such officer
      due to death or disability, or the retirement of Ken Kenworthy, Sr. (as Chief
      Financial Officer), shall not be a Change of Ownership or Control so long as
      the
      Corporation hires or promotes a replacement officer within four months; or
      (iv) of the consummation of a merger or share exchange of the Corporation
      with another entity where the Corporation's shareholders immediately prior
      to
      the merger or share exchange would not beneficially own, immediately after
      the
      merger or share exchange, shares representing 50% or more of the outstanding
      Voting Stock of the corporation issuing cash or securities in the merger or
      share exchange (without consideration of the rights of any class of stock to
      elect directors by a separate group vote), or where members of the Board of
      Directors immediately prior to the merger or share exchange would not,
      immediately after the merger or share exchange, constitute a majority of the
      board of directors of the corporation issuing cash or securities in the merger
      or share exchange.

     

    "Common
      Shares"
      shall
      mean the shares of Common Stock, par value $0.001 per share, of the
      Corporation.

     

    "Dividend
      Payment Date"
      shall
      have the meaning set forth in paragraph (a)
      of
Section
      3.

     

    "Dividend
      Periods"
      shall
      mean quarterly dividend periods commencing on January 1, April 1, July 1 and
      October 1 of each year and ending on and including the day preceding the first
      day of the next succeeding Dividend Period (other than the initial Dividend
      Period, which shall commence on the Issue Date and end on and include September
      30, 2006); provided, however, that any Dividend Period during which any Series
      B
      Preferred Shares shall be redeemed pursuant to Section
      5
      shall
      end on and include the Call Date only with respect to the Series B Preferred
      Shares being redeemed).

     

    "Dividend
      Rate"
      shall
      mean the dividend rate accruing on the Series B Preferred Shares, as applicable
      from time to time pursuant to the terms hereof.

     

    "EBITDA(X)"
      shall
      mean the sum of: (i) net income for the period, plus (ii) any
      extraordinary loss and other expenses not considered to be operating in nature
      reflected in such net income, minus (iii) any extraordinary gain, interest
      income and other income not considered operating in nature reflected in such
      net
      income, plus (iv) depreciation, depletion, amortization and all other
      non-cash expenses for that period, plus (v) all interest, fees, charges and
      related expenses paid or payable (without duplication) for that period to a
      lender in connection with borrowed money or the deferred purchase price of
      assets that are considered "interest expense" under generally accepted
      accounting principles, together with the portion of rent paid or payable
      (without duplication) for that period under capital lease obligations that
      should be treated as interest
      in accordance with Financial Accounting Standards Board Statement No. 13, plus
      (vi) the aggregate amount of federal and state taxes on or measured by
      income for that period

    
       

      
        
          
          

        

        
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    (whether
      or not payable during that period), plus (vii) the amounts classified as
      exploration expense and dry hole costs for a company following the successful
      efforts method of accounting.

     

    "Exchange
      Act"
      shall
      mean the Securities Exchange Act of 1934, as amended.

     

    "Fully
      Junior Shares"
      shall
      mean the Common Shares, the Corporation's authorized Series A Junior
      Participating Preferred Stock and any other class or series of shares of stock
      of the Corporation now or hereafter issued and outstanding over which the Series
      B Preferred Shares have preference or priority in both (i) the payment of
      dividends and (ii) the distribution of assets on any liquidation,
      dissolution or winding up of the Corporation.

     

    "Issue
      Date"
      shall
      mean August 11, 2006.

     

    "Junior
      Shares"
      shall
      mean the Common Shares and any other class or series of shares of stock of
      the
      Corporation now or hereafter issued and outstanding over which the Series B
      Preferred Shares have preference or priority in the payment of dividends or
      in
      the distribution of assets on any liquidation, dissolution or winding up of
      the
      Corporation and, unless the context clearly indicates otherwise, shall include
      Fully Junior Shares.

     

    "Market
      Value"
      of a
      given security shall mean the average of the daily Trading Price per share
      of
      such security for the ten consecutive Trading Days immediately prior to the
      date
      in question.

     

    "National
      Market Listing"
      shall
      mean the listing or quotation, as applicable, of securities on or in the New
      York Stock Exchange, American Stock Exchange LLC, The NASDAQ Global Market,
      The
      NASDAQ Global Select Market or The NASDAQ Capital Market or any comparable
      national securities exchange or national securities market.

     

    "Qualifying
      Public Company"
      shall
      mean a company with Voting Stock that is subject to a National Market Listing
      and that, on a pro-forma combined basis with the Corporation, had an
      EBITDA(X)-to-interest expense plus preferred dividends ratio of at least
      2.0-to-1.0 for the 12-month period ending as of the end of the company's fiscal
      quarter immediately preceding the subject Change of Ownership or
      Control.

     

    "Parity
      Shares"
      shall
      have the meaning set forth in paragraph (b)
      of
Section
      7.

     

    "Penalty
      Rate"
      shall
      mean twelve percent (12%) per annum.

     

    "Person"
      shall
      mean any individual, firm, partnership, limited liability company, corporation
      or other entity, and shall include any successor (by merger or otherwise) of
      such entity.

     

    "SEC"
      shall
      have the meaning set forth in Section
      9.

     

    "Series
      B Preferred Shares"
      shall
      have the meaning set forth in Section
      1.

     

    "set
      apart for payment"
      shall
      be deemed to include, without any action other than the following: the recording
      by the Corporation in its accounting ledgers of any accounting or 

    
       

      
        
          
          

        

        
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    bookkeeping
      entry which indicates, pursuant to an authorization by the Board of Directors
      and a declaration of dividends or other distribution by the Corporation, the
      initial and continued allocation of funds to be so paid on any series or class
      of shares of stock of the Corporation; provided, however, that if any funds
      for
      any class or series of Junior Shares or any class or series of shares of stock
      ranking on a parity with the Series B Preferred Shares as to the payment of
      dividends are placed in a separate account of the Corporation or delivered
      to a
      disbursing, paying or other similar agent, then "set apart for payment" with
      respect to the Series B Preferred Shares shall mean irrevocably placing such
      funds in a separate account or irrevocably delivering such funds to a
      disbursing, paying or other similar agent.

     

    "Stated
      Rate"
      shall
      mean 9.25% per annum.

     

    "Trading
      Day"
      shall
      mean, if a security is listed or admitted to trading on The NASDAQ Stock Market,
      the New York Stock Exchange, the American Stock Exchange LLC or another national
      securities exchange or national securities market, a full day on which The
      NASDAQ Stock Market or such other national securities exchange or national
      securities market on which the security is traded is open for business and
      on
      which trades may be made thereon.

     

    "Trading
      Price"
      of a
      security on any Trading Day (excluding any after-hours trading as of such date)
      shall mean:

     

    (a)  the
      last
      sale price, regular way, or, in case no such sale takes place on such day,
      the
      average of the closing bid and ask prices, regular way, in either case as
      reported by the principal consolidated transaction reporting system with respect
      to securities listed or admitted to trading or quoted on The NASDAQ Stock Market
      or, if such security is not listed or admitted to trading or quoted on The
      NASDAQ Stock Market, as reported in the principal consolidated transaction
      reporting system with respect to securities listed on the principal national
      securities exchange or national securities market on or in which such security
      is listed or admitted to trading;

     

    (b)  if
      such
      security is not listed on, admitted to trading or quoted on The NASDAQ Stock
      Market or a national securities exchange or national securities market on that
      date, the last price quoted by Interactive Data Corporation for that security
      on
      the date, or if Interactive Data Corporation is not quoting such price, a
      similar quotation service selected by the Corporation;

     

    (c)  if
      such
      security is not so quoted, the average mid-point of the last bid and ask prices
      for such security on that date from at least two dealers recognized as
      market-makers for such security selected by the Corporation for this purpose;
      or

     

    (d)  if
      such
      security is not so quoted, the average of the last bid and ask prices for such
      security on that date from a dealer engaged in the trading of such securities
      selected by the Corporation for such purpose.

     

    "Transfer
      Agent"
      means
      UMB Bank, n.a., or such other agent or agents of the Corporation as may be
      designated by the Board of Directors or its duly authorized designee as the
      transfer agent, registrar and dividend disbursing agent for the Series B
      Preferred Shares.

    
       

      
        
          
          

        

        
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    "Voting
      Preferred Shares"
      shall
      have the meaning set forth in Section
      8.

     

    "Voting
      Stock"
      shall
      mean stock of any class or kind having the power to vote generally for the
      election of directors.

     

    Section
      3.  Dividends.

     

    (a)  Holders
      of Series B Preferred Shares shall be entitled to receive, when and as declared
      by the Board of Directors out of funds of the Corporation legally available
      for
      the payment of distributions, cumulative preferential cash dividends at a rate
      per annum equal to the Dividend Rate of the $25.00 per share stated liquidation
      preference of the Series B Preferred Shares (equivalent to $2.3125 per Series
      B
      Preferred Share per annum). Except as otherwise provided in paragraphs
(b)
      and
(c)
      of this
Section
      3,
      the
      Dividend Rate shall be equal to the Stated Rate. Such dividends shall accrue
      and
      accumulate on each issued and outstanding share of the Series B Preferred Shares
      on a daily basis from (but excluding) the original date of issuance of such
      share and shall be payable quarterly in equal amounts in arrears on the last
      calendar day of each Dividend Period, beginning on September 30, 2006 (each
      such
      day being hereinafter called a "Dividend Payment Date"); provided that if any
      Dividend Payment Date is not a Business Day, then the dividend which would
      otherwise have been payable on such Dividend Payment Date may be paid on the
      next succeeding Business Day with the same force and effect as if paid on such
      Dividend Payment Date, and no interest or additional dividends or other sums
      shall accrue on the amount so payable from such Dividend Payment Date to such
      next succeeding Business Day. Any dividend payable on the Series B Preferred
      Shares for any partial dividend period shall be prorated and computed on the
      basis of a 360-day year consisting of twelve 30-day months. Dividends shall
      be
      payable to holders of record as they appear in the stock records of the
      Corporation at the close of business on the applicable record date, which shall
      be the tenth day preceding the applicable Dividend Payment Date, or such other
      date designated by the Board of Directors or an officer of the Corporation
      duly
      authorized by the Board of Directors for the payment of dividends that is not
      more than 30 nor less than ten days prior to such Dividend Payment
      Date.
      The
      initial dividend on the Series B Preferred Shares for the first Dividend Period
      ending on and including September 30, 2006, will be $0.3212 per Series B
      Preferred Share, payable on the first Dividend Payment Date.

     

    (b)  If
      the
      Corporation fails to pay cash dividends on the Series B Preferred Shares in
      full
      for any four Dividend Periods, whether consecutive or non-consecutive (a
      "Dividend Default"), then:

     

    (i)  the
      Dividend Rate shall increase to the Penalty Rate, commencing on the first day
      after the Dividend Payment Date on which the Dividend Default occurs and for
      each subsequent Dividend Payment Date thereafter until the second consecutive
      Dividend Payment Date following such time as the Corporation has paid all
      accumulated accrued and unpaid dividends on the Series B Preferred Shares in
      full in cash, at which time the Dividend Rate shall revert to the Stated
      Rate;

     

    (ii)  On
      the
      next Dividend Payment Date following the Dividend Payment Date on which the
      Dividend Default occurs, and continuing until the second consecutive Dividend
      Payment Date following such time as the Corporation has paid all 

     

    
       

      
        
          
          

        

        
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    accumulated
      accrued and unpaid dividends on the Series B Preferred Shares in full in cash,
      the Corporation shall pay all dividends on the Series B Preferred Shares,
      including all accumulated accrued and unpaid dividends, on each Dividend Payment
      Date either in cash or, if not paid in cash, by issuing to the holders thereof
      (A) if the Common Shares are then subject to a National Market Listing,
      fully-tradable, registered Common Shares with a value equal to the amount of
      dividends being paid, calculated based on the then current Market Value of
      the
      Common Shares, plus cash in lieu of any fractional Common Share; or (B) if
      the
      Common Shares are not then subject to a National Market Listing, additional
      shares of Series B Preferred Shares with a value equal to the amount of
      dividends being paid, calculated based on the stated $25.00 liquidation
      preference of the Series B Preferred Shares, plus cash in lieu of any fractional
      Series B Preferred Share (and dividends on any such Series B Preferred Shares
      upon issuance shall accrue at the Penalty Rate and accumulate until such time
      as
      the Dividend Rate shall revert to the Stated Rate in accordance with
      subparagraph (i)
      of this
      paragraph (b));

     

    (iii)  until
      such time as the Dividend Rate reverts to the Stated Rate pursuant to
      subparagraph (i)
      of this
      paragraph (b),
      the
      holders of Series B Preferred Shares will have the voting rights described
      below
      in Section
      8;
      and

     

    (iv)  to
      the
      extent that the Corporation determines a shelf registration statement to cover
      resales of Common Shares or Series B Preferred Shares is required in connection
      with the issuance of, or for resales of such Common Shares or Series B Preferred
      Shares issued as payment of a dividend, the Corporation will use its reasonable
      best efforts to file and maintain the effectiveness of such a shelf registration
      statement until such time as all sales of such stock have been resold
      thereunder.

     

    Following
      any Dividend Default that has been cured by the Corporation as provided above
      in
      subparagraph (i)
      of this
      paragraph (b),
      if the
      Corporation subsequently fails to pay cash dividends on the Series B Preferred
      Shares in full for any Dividend Period, such subsequent failure shall constitute
      a separate Dividend Default, and the foregoing provisions of subparagraphs
      (i),
      (ii),
      (iii)
      and
(iv)
      of this
      paragraph (b)
      shall
      immediately apply until such subsequent Dividend Default is cured as so
      provided.

     

    (c)  If
      the
      Corporation fails to maintain a National Market Listing for the Series B
      Preferred Shares for 180 days or longer (a "Listing Default"),
      then:

     

    (i)  the
      Dividend Rate shall increase to the Penalty Rate, commencing on the day after
      the Listing Default and continuing until such time as the Corporation has cured
      the Listing Default by again subjecting the Series B Preferred Shares to a
      National Market Listing, at which time the Dividend Rate shall revert to the
      Stated Rate; and

     

    (ii)  until
      such time as the Dividend Rate reverts to the Stated Rate pursuant to
      subparagraph (i)
      of this
      paragraph (c),
      the
      holders of Series B Preferred Shares will have the voting rights described
      below
      in Section
      8.

     

    Following
      any 180-day Listing Default that has been cured by the Corporation as provided
      above in subparagraph (i)
      of this
      paragraph (c),
      if the
      Series B Preferred Shares subsequently cease to 

    
       

      
        
          
          

        

        
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    be
      subject to a National Market Listing, such event shall constitute a separate
      Listing Default, and the foregoing provisions of subparagraphs (i)
      and
(ii)
      of this
      paragraph (c)
      shall
      immediately apply until such time as the Series B Preferred Shares are again
      subject to a National Market Listing.

     

    (d)  The
      Corporation shall at all times keep reserved a sufficient number of Common
      Shares or Series B Preferred Shares for the payment of dividends on the Series
      B
      Preferred Shares as described above in paragraphs (b)
      and
(c)
      of this
Section
      3,
      and if
      a dividend is paid in shares of stock, an amount equal to the aggregate par
      value of the shares issued shall be designated as capital in respect of such
      shares in accordance with Section 1052 of the Act. For purposes of calculating
      the amount of capital of the Corporation under the Act with respect to the
      Corporation's ability to pay dividends on, or to repurchase or redeem shares
      of
      any other class or series of its capital stock, the Board of Directors shall
      take into consideration its reasonable estimate of the amount of capital
      represented by Common Shares or Series B Preferred Shares (which shall equal
      the
      par value thereof) that may be issued as dividends on the Series B Preferred
      Shares as described in this Section
      3
      as if
      such Common Shares or Series B Preferred Shares were issued and
      outstanding.

     

    (e)  No
      dividend on the Series B Preferred Shares will be declared by the Corporation
      or
      paid or set apart for payment by the Corporation at such time as the terms
      and
      provisions of any agreement of the Corporation, including any agreement relating
      to its indebtedness, prohibit such declaration, payment or setting apart for
      payment or provide that such declaration, payment or setting apart for payment
      would constitute a breach thereof or a default thereunder, or if such
      declaration, payment or setting aside of funds is restricted or prohibited
      by
      law;
      provided, however, notwithstanding anything to the contrary contained herein,
      dividends on the Series B Preferred Shares shall continue to accrue and
      accumulate regardless of whether: (i) any or all of the foregoing
      restrictions exist; (ii) the Corporation has earnings or profits;
      (iii) there are funds legally available for the payment of such dividends;
      or (iv) such dividends are authorized by the Board of Directors. Accrued
      and unpaid dividends on the Series B Preferred Shares will accumulate as of
      the
      Dividend Payment Date on which they first become payable or on the date of
      redemption as the case may be.

     

    (f)  Except
      as
      provided in the next sentence, if any Series B Preferred Shares are outstanding,
      no dividends will be declared or paid or set apart for payment on any Parity
      Shares or Junior Shares ranking, as to dividends, on a parity with or junior
      to
      the Series B Preferred Shares unless all accumulated accrued and unpaid
      dividends are contemporaneously declared and paid in cash or declared and a
      sum
      of cash sufficient for the payment thereof set apart for such payment on the
      Series B Preferred Shares for all past Dividend Periods with respect to which
      full dividends were not paid on the Series B Preferred Stock either in cash
      or
      in Common Shares or Series B Preferred Shares. When dividends are not paid
      in
      full (or a sum sufficient for such full payment is not so set apart for payment)
      upon the Series B Preferred Shares and upon all Parity Shares ranking, as to
      dividends, on a parity with the Series B Preferred Shares, all dividends
      declared, paid or set apart for payment upon the Series B Preferred Shares
      and
      all such Parity Shares shall be declared and paid pro rata or declared and
      set
      apart for payment pro rata so that the amount of dividends declared per share
      of
      Series B Preferred Shares and per share of such Parity Shares shall in all
      cases
      bear to each other the same ratio that accumulated dividends per share of Series
      B Preferred Shares and such other Parity

     

    
      
        
        

      

      
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    Shares
      (which shall not include any accumulation in respect of unpaid dividends for
      prior dividend periods if such other Parity Shares do not bear cumulative
      dividends) bear to each other. No interest, or sum of money in lieu of interest,
      shall be payable in respect of any dividend payment or payments on Series B
      Preferred Shares which may be in arrears, whether at the Stated Rate or at
      the
      Penalty Rate.

     

    (g)  Except
      as
      provided in paragraph (f)
      of this
Section
      3,
      unless
      all accumulated accrued and unpaid dividends on the Series B Preferred Shares
      are contemporaneously declared and paid in cash or declared and a sum of cash
      sufficient for the payment thereof is set apart for payment for all past
      Dividend Periods with respect to which full dividends were not paid on the
      Series B Preferred Stock either in cash or in Common Shares or Series B
      Preferred Shares, no dividends (other than in shares of Common Shares or Junior
      Shares ranking junior to the Series B Preferred Shares as to dividends and
      upon
      liquidation) may be declared or paid or set apart for payment, nor shall any
      other dividend be declared or made upon the Common Shares or any Junior Shares
      or Parity Shares, nor shall any Common Shares or any Junior Shares or Parity
      Shares be redeemed, purchased or otherwise acquired directly or indirectly
      for
      any consideration (or any monies be paid to or made available for a sinking
      fund
      for the redemption of any such stock) by the Corporation (except by conversion
      into or exchange for Junior Shares or by redemption, purchase or acquisition
      of
      stock under any employee benefit plan of the Corporation).

     

    (h)  Holders
      of Series B Preferred Shares shall not be entitled to any dividend, whether
      payable in cash, property or shares, in excess of all accumulated accrued and
      unpaid dividends on the Series B Preferred Shares as described in this
Section
      3.
      Any
      dividend payment made on the Series B Preferred Shares shall first be credited
      against the earliest accumulated accrued and unpaid dividend due with respect
      to
      such shares which remains payable at the time of such payment.

     

    (i)  In
      determining whether a distribution (other than upon voluntary or involuntary
      liquidation, dissolution or winding up of the Corporation) by dividend,
      redemption or otherwise is permitted under Oklahoma law, no effect shall be
      given to amounts that would be needed, if the Corporation were to be dissolved
      at the time of the distribution, to satisfy the preferential rights upon
      dissolution of shareholders whose preferential rights on dissolution are
      superior to those receiving the distribution.

     

    Section
      4.  Liquidation
      Preference.

     

    (a)  In
      the
      event of any liquidation, dissolution or winding up of the Corporation, whether
      voluntary or involuntary, before any payment or distribution of the assets
      of
      the Corporation (whether capital or surplus) shall be made to or set apart
      for
      the holders of Junior Shares, as to the distribution of assets on any
      liquidation, dissolution or winding up of the Corporation, each holder of the
      Series B Preferred Shares shall be entitled to receive an amount of cash equal
      to $25.00 per Series B Preferred Share plus an amount in cash equal to all
      accumulated accrued and unpaid dividends thereon (whether or not earned or
      declared) to the date of final distribution to such holders. If, upon any
      liquidation, dissolution or winding up of the Corporation, the assets of the
      Corporation, or proceeds thereof, distributable among the holders of the Series
      B Preferred Shares shall be insufficient to pay in full the preferential


     

    
      
        
        

      

      
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    amount
      aforesaid and liquidating payments on any other shares of any class or series
      of
      Parity Shares as to the distribution of assets on any liquidation, dissolution
      or winding up of the Corporation, then such assets, or the proceeds thereof,
      shall be distributed among the holders of Series B Preferred Shares and any
      such
      other Parity Shares ratably in accordance with the respective amounts that
      would
      be payable on such Series B Preferred Shares and any such other Parity Shares
      if
      all amounts payable thereon were paid in full. For the purposes of this
Section
      4,
      none of
      (i) a consolidation or merger of the Corporation with one or more
      corporations or other entities, (ii) a sale, lease or transfer of all or
      substantially all of the Corporation's assets or (iii) a statutory share
      exchange shall be deemed to be a liquidation, dissolution or winding up,
      voluntary or involuntary, of the Corporation.

     

    (b)  Subject
      to the rights of the holders of shares of any series or class or classes of
      shares of stock ranking on a parity with or prior to the Series B Preferred
      Shares upon liquidation, dissolution or winding up, upon any liquidation,
      dissolution or winding up of the Corporation, after payment shall have been
      made
      in full to the holders of the Series B Preferred Shares, as provided in this
      Section
      4,
      any
      other series or class or classes of Junior Shares shall, subject to the
      respective terms and provisions (if any) applying thereto, be entitled to
      receive any and all assets remaining to be paid or distributed, and the holders
      of the Series B Preferred Shares shall not be entitled to share
      therein.

     

    Section
      5.  Redemption.

     

    (a)  The
      Series B Preferred Shares shall not be redeemable by the Corporation prior
      to
      September 30, 2011, except following a Change of Ownership or Control as
      provided below in paragraphs (b)
      and
(c)
      of this
Section
      5.
      On and
      after September 30, 2011, the Corporation, at its option, may redeem the Series
      B Preferred Shares, in whole at any time or from time to time in part at the
      option of the Corporation at a redemption price of $25.00 per Series B Preferred
      Share, plus the amounts indicated in paragraph (d)
      of this
Section
      5.

     

    (b)  Following
      a Change of Ownership or Control other than a Change of Ownership or Control
      with, to or involving a Qualifying Public Company, within 90 days following
      the
      date on which the Change of Ownership or Control has occurred, the Corporation
      or the acquiring entity in such Change of Ownership or Control shall redeem
      the
      Series B Preferred Shares, in whole and not in part, for cash at the following
      price per Series B Preferred Share, plus the amounts indicated in paragraph
      (d)
      of this
Section
      5:

     

    (i)  if
      the
      Call Date is on or before September 30, 2007, $26.00;

     

    (ii)  if
      the
      Call Date is after September 30, 2007, but on or before September 30, 2008,
      $25.75;

     

    (iii)  if
      the
      Call Date is after September 30, 2008, but on or before September 30, 2009,
      $25.50;

     

    (iv)  if
      the
      Call Date is after September 30, 2009, but on or before September 30, 2010,
      $25.25; and

     

    
      (v)  if
        the
        Call Date is after September 30, 2010, $25.00.

    

     

    
      
        
        

      

      
        –9–

        
          

        

      

      
        
        

      

    

    (c)  Following
      a Change of Ownership or Control with, to or involving a Qualifying Public
      Company, for a period of 90 days following the date on which the Change of
      Ownership or Control has occurred, such Qualifying Public Company will have
      the
      right, but not the obligation, to redeem the Series B Preferred Shares, in
      whole
      but not in part, for cash at the applicable price determined pursuant to the
      schedule provided in subparagraphs (i)
      through
(v)
      of
      paragraph (b)
      of this
Section
      5,
      plus
      the amounts indicated in paragraph (d)
      of this
Section
      5.

     

    (d)  Upon
      any
      redemption of Series B Preferred Shares pursuant to this Section
      5,
      the
      Corporation (or, if applicable, the Qualifying Public Company) shall, subject
      to
      the next sentence, pay any accumulated accrued and unpaid dividends in arrears
      for any Dividend Period ending on or prior to the Call Date. If the Call Date
      falls after a dividend payment record date and prior to the corresponding
      Dividend Payment Date, then each holder of Series B Preferred Shares at the
      close of business on such dividend payment record date shall be entitled to
      the
      dividend payable on such shares on the corresponding Dividend Payment Date
      notwithstanding the redemption of such shares before such Dividend Payment
      Date.
      Except as provided above, the Corporation shall make no payment or allowance
      for
      unpaid dividends, whether or not in arrears, on Series B Preferred Shares called
      for redemption.

     

    (e)  If
      all
      accumulated accrued and unpaid dividends on the Series B Preferred Shares and
      any other class or series of Parity Shares of the Corporation have not been
      paid
      in cash, Common Shares or Series B Preferred Shares, or declared and set apart
      for payment in cash, the Series B Preferred Shares shall not be redeemed under
      this Section
      5
      in part
      and the Corporation shall not purchase or acquire Series B Preferred Shares,
      otherwise than pursuant to a purchase or exchange offer made on the same terms
      to all holders of Series B Preferred Shares and Parity Shares.

     

    (f)  Notice
      of
      the redemption of any Series B Preferred Shares under this Section
      5
      shall be
      mailed by first class mail to each holder of record of Series B Preferred Shares
      to be redeemed at the address of each such holder as shown on the Corporation's
      records, not less than 30 nor more than 60 days prior to the Call Date. Neither
      the failure to mail any notice required by this paragraph (f),
      nor any
      defect therein or in the mailing thereof, to any particular holder, shall affect
      the sufficiency of the notice or the validity of the proceedings for redemption
      with respect to the other holders. Any notice which was mailed in the manner
      herein provided shall be conclusively presumed to have been duly given on the
      date mailed whether or not the holder receives the notice. Each such mailed
      notice shall state, as appropriate: (1) the Call Date; (2) the number
      of Series B Preferred Shares to be redeemed and, if fewer than all the shares
      held by such holder are to be redeemed, the number of such shares to be redeemed
      from such holder; (3) the redemption price per Series B Preferred Share
      (determined as set forth in paragraph (a)
      or
(b)
      of this
Section
      5,
      as
      applicable) plus accumulated accrued and unpaid dividends through the Call
      Date
      (determined as set forth in paragraph (d)
      of this
Section
      5);
      (4) the place or places at which certificates for such shares are to be
      surrendered; (5) that dividends on the shares to be redeemed shall cease to
      accrue on such Call Date except as otherwise provided herein; and (6) any
      other information required by law or by the applicable rules of any exchange
      or
      national securities market upon which the Series B Preferred Shares may be
      listed or admitted for trading. Notice having been mailed as aforesaid, from
      and
      after the Call Date (unless the Corporation (or, if applicable, the Qualifying
      Public Company) shall fail to make available an amount of cash necessary to
      effect such redemption), (i) except as otherwise provided herein, dividends
      on the 

     

    
      
        
        

      

      
        –10–

        
          

        

      

      
        
        

      

    

    Series
      B
      Preferred Shares so called for redemption shall cease to accrue, (ii) said
      shares shall no longer be deemed to be outstanding, and (iii) all rights of
      the holders thereof as holders of Series B Preferred Shares shall cease (except
      the right to receive cash payable upon such redemption, without interest
      thereon, upon surrender and endorsement of their certificates if so required
      and
      to receive any dividends payable thereon).

     

    (g)  The
      Corporation's (or, if applicable, the Qualifying Public Company's) obligation
      to
      provide cash in accordance with the preceding sentence shall be deemed fulfilled
      if, on or before the Call Date, the Corporation (or such Qualifying Public
      Company) shall irrevocably deposit funds necessary for such redemption, in
      trust, with a bank or trust company that has, or is an affiliate of a bank
      or
      trust company that has, capital and surplus of at least $50,000,000, with
      irrevocable instructions that such cash be applied to the redemption of the
      Series B Preferred Shares so called for redemption, in which case the notice
      to
      holders of the Series B Preferred Shares will (i) state the date of such
      deposit, (ii) specify the office of such bank or trust company as the place
      of payment of the redemption price and (iii) require such holders to
      surrender the certificates representing such shares at such place on or about
      the date fixed in such redemption notice (which may not be later than the Call
      Date) against payment of the redemption price (including all accumulated accrued
      and unpaid dividends to the redemption date). No interest shall accrue for
      the
      benefit of the holders of Series B Preferred Shares to be redeemed on any cash
      so set aside by the Corporation (or such Qualifying Public Company). Subject
      to
      applicable escheat laws, any such cash unclaimed at the end of six months from
      the Call Date shall revert to the general funds of the Corporation (or such
      Qualifying Public Company), after which reversion the holders of such shares
      so
      called for redemption shall look only to the general funds of the Corporation
      (or such Qualifying Public Company) for the payment of such cash.

     

    (h)  As
      promptly as practicable after the surrender in accordance with said notice
      of
      the certificates for any such shares so redeemed (properly endorsed or assigned
      for transfer, if the Corporation (or, if applicable, the Qualifying Public
      Company) shall so require and if the notice shall so state), such shares shall
      be exchanged for any cash (without interest thereon) for which such shares
      have
      been redeemed. If fewer than all the outstanding Series B Preferred Shares
      are
      to be redeemed, shares to be redeemed shall be selected by the Corporation
      from
      outstanding Series B Preferred Shares not previously called for redemption
      by
      lot or pro rata (as nearly as may be) or by any other method determined by
      the
      Corporation in its sole discretion to be equitable. If fewer than all the Series
      B Preferred Shares represented by any certificate are redeemed, then new
      certificates representing the unredeemed shares shall be issued without cost
      to
      the holder thereof.

     

    Section
      6.  Shares
      to Be Retired.  
      All Series B Preferred Shares which shall have been issued and redeemed by
      the
      Corporation in accordance with Section
      5
      above
      shall be restored to the status of undesignated, authorized but unissued shares
      of Preferred Stock of the Corporation.

     

    Section
      7.  Ranking.  
      Any class or series of shares of stock of the Corporation shall be deemed to
      rank:

     

    (a)  prior
      to
      the Series B Preferred Shares, as to the payment of dividends and as to
      distribution of assets upon liquidation, dissolution or winding up, if the
      holders of such

     

    
       

      
        
          
          

        

        
          –11–

          
            

          

        

        
          
          

        

      

    

    class
      or
      series shall be entitled to the receipt of dividends or of amounts distributable
      upon liquidation, dissolution or winding up, as the case may be, in preference
      or priority to the holders of Series B Preferred Shares;

     

    (b)  on
      a
      parity with the Series B Preferred Shares, as to the payment of dividends and
      as
      to distribution of assets upon liquidation, dissolution or winding up, whether
      or not the dividend rates, dividend payment dates or redemption or liquidation
      prices per share thereof be different from those of the Series B Preferred
      Shares, if the holders of such class or series and the Series B Preferred Shares
      shall be entitled to the receipt of dividends and of amounts distributable
      upon
      liquidation, dissolution or winding up in proportion to their respective amounts
      of accrued and unpaid dividends per share or liquidation preferences, without
      preference or priority one over the other ("Parity Shares");

     

    (c)  junior
      to
      the Series B Preferred Shares, as to the payment of dividends or as to the
      distribution of assets upon liquidation, dissolution or winding up, if such
      class or series shall be Junior Shares; and

     

    (d)  junior
      to
      the Series B Preferred Shares, as to the payment of dividends and as to the
      distribution of assets upon liquidation, dissolution or winding up, if such
      class or series shall be Fully Junior Shares.

     

    Section
      8.  Voting.   
      In the circumstances identified in subparagraphs (b)
      and
(c)
      of
Section
      3
      hereof,
      the number of directors then constituting the Board of Directors shall be
      increased by two, and the holders of Series B Preferred Shares, together with
      the holders of shares of every other series of Parity Shares upon which like
      voting rights have been conferred and are exercisable (any such other series,
      the "Voting Preferred Shares"), voting as a single class regardless of series,
      shall be entitled to elect two additional directors at any annual meeting of
      shareholders or special meeting held in place thereof, or at a special meeting
      of the holders of the Series B Preferred Shares and the Voting Preferred Shares
      called as hereinafter provided. Such voting rights shall continue until
      terminated as provided in subparagraph (b)
      or
(c)
      of
Section
      3
      hereof,
      as applicable, whereupon the terms of all persons elected as directors by the
      holders of the Series B Preferred Shares and the Voting Preferred Shares shall
      terminate and the number of directors constituting the Board of Directors,
      shall
      be reduced accordingly. At any time after such voting power shall have been
      so
      vested in the holders of Series B Preferred Shares and the Voting Preferred
      Shares, the Secretary of the Corporation may, and upon the written request
      of
      any holder of Series B Preferred Shares (addressed to the Secretary at the
      principal office of the Corporation) shall, call a special meeting of the
      holders of the Series B Preferred Shares and of the Voting Preferred Shares
      for
      the election of the two directors to be elected by them as herein provided,
      such
      call to be made by notice similar to that provided in the Bylaws of the
      Corporation for a special meeting of the shareholders or as required by law.
      If
      any such special meeting required to be called as above provided shall not
      be
      called by the Secretary within 20 days after receipt of any such request, then
      any holder of Series B Preferred Shares may call such meeting, upon the notice
      above provided, and for that purpose shall have access to the share records
      of
      the Corporation. The directors elected at any such special meeting shall serve
      until the next annual meeting of the shareholders or special meeting held in
      lieu thereof and until their successors are duly elected and qualified, if
      such
      term shall not have previously terminated as above provided. If any vacancy
      shall occur among the directors elected by the 

     

    
      
        
        

      

      
        –12–

        
          

        

      

      
        
        

      

    

    holders
      of the Series B Preferred Shares and the Voting Preferred Shares, a successor
      shall be elected by the Board of Directors, upon the nomination of the
      then-remaining director elected by the holders of the Series B Preferred Shares
      and the Voting Preferred Shares or the successor of such remaining director,
      if
      any, to serve until the next annual meeting of the shareholders or special
      meeting held in place thereof and until their successors are duly elected and
      qualified, if such term shall not have previously terminated as provided
      above.

     

    So
      long
      as any Series B Preferred Shares are outstanding, the affirmative vote of the
      holders of at least 66-2/3% of the Series B Preferred Shares and the Voting
      Preferred Shares at the time outstanding, acting as a single class regardless
      of
      series, given in person or by proxy, either in writing without a meeting or
      by
      vote at any meeting called for the purpose, shall be necessary for effecting
      or
      validating:

     

    (a)  Any
      amendment, alteration or repeal of any of the provisions of the Certificate
      of
      Incorporation or this Certificate of Designation of the Series B Preferred
      Shares that materially and adversely affects the rights, preferences or voting
      power of the Series B Preferred Shares or the Voting Preferred Shares; provided,
      however, that the amendment of the provisions of the Certificate of
      Incorporation so as to authorize or create, or to increase the authorized amount
      of, the Series B Preferred Shares, any Fully Junior Shares, Junior Shares that
      are not senior in any respect to the Series B Preferred Shares or the Voting
      Preferred Shares, or any shares of any class ranking, as to receipt of dividends
      or distribution of assets upon liquidation, dissolution or winding up of the
      Corporation, on a parity with the Series B Preferred Shares or the Voting
      Preferred Shares shall not be deemed to materially or adversely affect the
      rights, preferences or voting power of the Series B Preferred Shares or the
      Voting Preferred Shares, and provided, further, that if any such amendment,
      alteration or repeal would materially and adversely affect any voting powers,
      rights or preferences of the Series B Preferred Shares or another series of
      Voting Preferred Shares that are not enjoyed by some or all of the other series
      otherwise entitled to vote in accordance herewith, the affirmative vote of
      at
      least 66-2/3% of the votes entitled to be cast by the holders of all series
      similarly affected, similarly given, shall be required in lieu of the
      affirmative vote of at least 66-2/3% of the votes entitled to be cast by the
      holders of the Series B Preferred Shares and the Voting Preferred Shares
      otherwise entitled to vote in accordance herewith;

     

    (b)  A
      statutory share exchange that affects the Series B Preferred Shares, a
      consolidation with or merger of the Corporation into another entity, or a
      consolidation with or merger of another entity into the Corporation, unless
      in
      each such case each Series B Preferred Share (i) shall remain outstanding
      without a material and adverse change to its terms, voting powers, preferences
      and rights or (ii) shall be converted into or exchanged for preferred
      shares of the surviving entity having preferences, conversion or other rights,
      voting powers, restrictions, limitations as to dividends or distributions,
      qualifications and terms or conditions of redemption thereof identical to that
      of a Series B Preferred Share (except for changes that do not materially and
      adversely affect the Series B Preferred Shares); provided, however, that if
      any
      such share exchange, consolidation or merger would materially and adversely
      affect any voting powers, rights or preferences of the Series B Preferred Shares
      or another series of Voting Preferred Shares that are not enjoyed by some or
      all
      of the other series otherwise entitled to vote in accordance herewith, the
      affirmative vote of at least 66-2/3% of the votes entitled to be cast by the
      holders of all series similarly affected, similarly given, shall be required
      in
      lieu of the 

     

    
      
        
        

      

      
        –13–

        
          

        

      

      
        
        

      

    

    affirmative
      vote of at least 66-2/3% of the votes entitled to be cast by the holders of
      the
      Series B Preferred Shares and the Voting Preferred Shares otherwise entitled
      to
      vote in accordance herewith; or

     

    (c)  The
      authorization, reclassification or creation of, or the increase in the
      authorized amount of, any shares of any class or any security convertible into
      or exchangeable for shares of any class ranking prior to the Series B Preferred
      Shares or the Voting Preferred Shares in the distribution of assets on any
      liquidation, dissolution or winding up of the Corporation or in the payment
      of
      dividends;

     

    provided,
      however, that no such vote of the holders of Series B Preferred Shares shall
      be
      required after September 30, 2011, or in connection with a Change of Ownership
      or Control if, at or prior to the time when such amendment, alteration, repeal,
      share exchange, consolidation, merger or conversion is to take effect, or when
      the issuance of any such prior shares or convertible security is to be made,
      as
      the case may be, a deposit is made for the redemption in cash of all Series
      B
      Preferred Shares at the time outstanding as provided in paragraph (g)
      of
Section
      5
      hereof
      for a redemption price determined under the appropriate paragraph of
Section
      5.

     

    For
      purposes of the foregoing provisions of this Section
      8,
      each
      Series B Preferred Share shall have one vote per share, except that when any
      other series of Voting Preferred Shares shall have the right to vote with the
      Series B Preferred Shares as a single class on any matter, then the Series
      B
      Preferred Shares and such other series shall have with respect to such matters
      one vote per $25.00 of stated liquidation preference. Except as set forth
      herein, the Series B Preferred Shares shall not have any relative,
      participating, optional or other special voting rights and powers other than
      as
      set forth herein, and the consent of the holders thereof shall not be required
      for the taking of any corporate action.

     

    No
      amendment to this Certificate of Designation shall require the vote of the
      holders of Common Shares or any series of Preferred Stock other than the Voting
      Preferred Shares.

     

    Section
      9.  Information
      Rights.  
      During any period in which the Corporation is not subject to Section 13 or
      15(d)
      of the Exchange Act and any Series B Preferred Shares are outstanding, the
      Corporation shall (a) transmit by mail to all holders of Series B Preferred
      Shares, as their names and addresses appear in the Corporation's record books
      and without cost to such holders, copies of the annual reports and quarterly
      reports that the Corporation would have been required to file with the
      Securities and Exchange Commission (the "SEC") pursuant to Section 13 or 15(d)
      of the Exchange Act if the Corporation was subject to such Sections (other
      than
      any exhibits that would have been required), and (b) promptly upon written
      request, supply copies of such reports to any prospective holder of Series
      B
      Preferred Shares. The Corporation shall mail the reports to the holders of
      Series B Preferred Shares within 15 days after the respective dates by which
      the
      Corporation would have been required to file the reports with the SEC if the
      Corporation were then subject to Section 13 or 15(d) of the Exchange
      Act.

     

    Section
      10.  Record
      Holders. 
      The Corporation and the Transfer Agent shall deem and treat the record holder
      of
      any Series B Preferred Shares as the true and lawful owner thereof for all
      purposes, and neither the Corporation nor the Transfer Agent shall be affected
      by any notice to the contrary.

     

    
      
        
        

      

      
        –14–

        
          

        

      

      
        
        

      

    

    Section
      11.  Sinking
      Fund. 
      The Series B Preferred Shares shall not be entitled to the benefits of any
      retirement or sinking fund.

     

    Section
      12.  Conversion.  
      The Series B Preferred Shares shall not be convertible into or exchangeable
      for
      any stock or other securities or property of the Corporation.

     

    Section
      13.  Book
      Entry. 
       The Series B Preferred Shares shall be issued initially in the form of one
      or more fully registered global certificates ("Global Preferred Shares"), which
      shall be deposited on behalf of the purchasers represented thereby with the
      Transfer Agent, as custodian for a securities depositary (the "Depositary")
      that
      is a clearing agency under Section 17A of the Exchange Act (or with such other
      custodian as the Depositary may direct), and registered in the name of the
      Depositary or its nominee, duly executed by the Corporation and authenticated
      by
      the Transfer Agent. The number of Series B Preferred Shares represented by
      Global Preferred Shares may from time to time be increased or decreased by
      adjustments made on the records of the Transfer Agent and the Depositary as
      hereinafter provided. Members of, or participants in, the Depositary ("Agent
      Members") shall have no rights under this Certificate of Designation with
      respect to any Global Preferred Shares held on their behalf by the Depositary
      or
      by the Transfer Agent as the custodian of the Depositary or under such Global
      Preferred Shares, and the Depositary may be treated by the Corporation, the
      Transfer Agent and any agent of the Corporation or the Transfer Agent as the
      absolute owner of such Global Preferred Shares for all purposes whatsoever.
      Notwithstanding the foregoing, nothing herein shall prevent the Company, the
      Transfer Agent or any agent of the Company or the Transfer Agent from giving
      effect to any written certification, proxy or other authorization furnished
      by
      the Depositary or impair, as between the Depositary and its Agent Members,
      the
      operation of customary practices of the Depositary governing the exercise of
      the
      rights of a holder of a beneficial interest in any Global Preferred
      Shares.

     

    IN
      WITNESS WHEREOF, the Corporation has caused this Certificate of Designation
      to
      be executed on this 8th day of August, 2006.

     

     

    
      	 	 	 
	 	
              GMX
                RESOURCES INC.

            
	 
 	 
 	 
 
	
            	By:  	/s/ Ken
              L. Kenworthy, Jr.
	 	
              
Ken
              L. Kenworthy, Jr.
	 	Chief
              Executive Officer


    

     

     

     

    
      	
              ATTEST:

               

               

            	 	 	 
	/s/
              Ken L.
              Kenworthy	 	 	
            
	
              
Ken
              L. Kenworthy	 	 	
            
	Secretary	 	 	 


    

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        –15–