GMX RESOURCES INC.

 

CHARTER OF NOMINATING COMMITTEE

(As approved by the Board on May 27, 2004)

 1.         Mission Statement

The Nominating Committee shall assist the full Board of Directors in selecting individuals for service on the Board of Directors of the Company and evaluating their performance.

2.         Membership and Qualification

The Committee shall consist of two or more "independent directors" as defined in and determined pursuant to the Corporate Governance Rules of the NASDAQ Stock Market, Inc. ("NASDAQ").  The Committee members shall be elected by the Board annually for terms of one year, or until their successors shall be duly elected and qualified.  The Board may remove any Committee member at any time.  Unless a Committee Chairman is elected by the full Board, the Committee members may designate a Chairman.

3.         Meetings and Other Actions

The Committee shall meet at least once a year and at such additional times as may be necessary to carry out its responsibilities. Meetings may be called by the Chairman of the Committee or at the request of the Chief Executive Officer.  All meetings of and other actions by the Committee shall be held or otherwise taken pursuant to the Companyís Bylaws, including Bylaw provisions governing notices of meetings, waivers thereof, the number of Committee members required to take actions at meetings or by written consent, and other related matters. 

Reports of meetings of and actions taken at meetings or by consent by the Committee since the most recent Board meeting (except to the extent covered in an interim report circulated to the Board) shall be made by the Committee Chairman or his/her delegate to the Board of Directors at its next regularly scheduled meeting following the Committee meeting or action and shall be accompanied by any recommendations from the Committee to the Board of Directors.  In addition, the Committee Chairman or his/her delegate shall be available to answer any questions the other Directors may have regarding the matters considered and actions taken by the Committee.

  1. Responsibilities and Authority

In carrying out its mission, the Committee shall have the following responsibilities and authority:

A.     Evaluate periodically the desirability of and recommend to the Board any changes in the size and composition of the Board.

  1. Make recommendations to the Board for the selection of directors in accordance with the criteria set forth below:

    Director selection should include at least enough independent directors (as defined in and determined pursuant to the corporate governance rules of the NASDAQ and the rules of the SEC) so that the independent directors will constitute at least a majority of the Board no later than July 31, 2005.

  Independent directors should have appropriate skills, experiences and other characteristics to provide qualified persons to fill all Board Committee positions required to be filled by independent directors. 

   The Chief Executive Officer of the Company shall be a director and, depending on the circumstances, certain other members of management, as well as certain individuals having relationships with the Company that prevent them from being independent directors, may be appropriate members of the Board. 

∑ Each director should:

o    Be an individual of the highest character and integrity;

o     Be free of any interest which would violate any applicable law or regulation or interfere with the proper performance of the responsibilities of a director;

o   Be willing and able to devote sufficient time to the affairs of the Company and be diligent in fulfilling the responsibilities of a director and Board Committee member (including developing and maintaining sufficient knowledge of the Company and its industry; reviewing and analyzing reports and other information important to Board and Committee responsibilities and preparing for, attending and participating in Board and Committee meetings; and

o   Have the capacity and desire to represent the balanced, best interests of the shareholders as a whole and not primarily a special interest group or constituency.

    The Committee should consider candidates for directors who have skills, experiences (whether in business or in other areas such as public service or academia), particular areas of expertise, specific backgrounds, and other characteristics that should enhance the diversity of members of the Board and should also enhance effectiveness of the Board and its Committees. 

  1. Evaluate each new director candidate and each incumbent director before recommending that the Board nominate or renominate such individual for election or reelection (or that the Board elect such individual on an interim basis) as a director based on the extent to which such individual meets the criteria above.

∑ Each decision to renominate incumbent directors should be based on a careful consideration of each such individualís contributions, including the value of his/her experience as a director of the Company, the availability of new director candidates, if any, who may offer unique contributions, and the Companyís changing needs.

  1. Diligently seek to identify potential director candidates who will strengthen the Board. 

E.      Submit to the Board the candidates for Director to be recommended by the Board for election at each annual meeting of shareholders and to be added to the Board at any other times due to Board expansions, director resignations or retirements or otherwise.

F.      Monitor performance of directors to assure that they are fulfilling their responsibilities in accordance with the criteria set forth above.  If any serious problems are identified, work with such director to resolve such problems or, if necessary, seek such directorís resignation or recommend to the Board such personís removal.

G.     Perform an annual self-evaluation of the Nominating Committee's performance and annually reassess the adequacy of, and if appropriate propose to the Board any deserved changes in the Nominating Committee Charter.

H.     Perform such other duties and responsibilities as may be assigned to the Committee, from time to time, by the Board of Directors of the Company.

  1. Nominations by Shareholders

The Committee will consider recommendations from shareholders for nomination as a Board member. Any such recommendation should be addressed to the Company's corporate secretary and should contain (i) the name address and telephone number and number of shares owned by the shareholder making the recommendation and a statement that the shareholder has a good faith intent to remain as a shareholder until the Company's next annual meeting of shareholders; (ii) the information about the proposed nominee that would be required to be disclosed by the applicable rules of the Securities and Exchange Commission if the nominee were nominated; (iii) a description of any relationship between the nominee and the shareholder making the recommendation; (iv) any additional information that the shareholder desires to submit addressing the reasons that the nominee should be nominated to the Board; and (v) a consent of the nominee to be interviewed by the Committee if requested and to serve on the Board if nominated and elected.  Any recommendation should be submitted at least 120 days prior to the first anniversary of the date of the proxy statement for the prior annual meeting of shareholders.  There are no specific minimum qualifications for shareholder nominees.

  1. Communications with Directors

The Committee will recommend procedures for persons to communicate with directors. The following procedures will be in effect until changed by the Committee.  Any person, including any security holder, desiring to communicate with, or make any concerns known to, the Company, directors generally, non-management directors or an individual director only may do so by submitting them in writing to the Secretary of the Company, with information to identify the person submitting the communication or concern, including name, address, telephone number and e-mail address (if applicable) together with information indicating the relationship of such person to the Company.  The Secretary will be responsible for maintaining a record of any such communications or concerns and submitting them to the appropriate addressee(s) for potential action or response.  The Company may institute appropriate procedures to establish the authenticity of any communication or concern before forwarding.  The Company will not be obligated to investigate or forward any anonymous submissions from persons who are not employees of the Company.

  1. Additional Resources

The Committee shall have the right to use reasonable amounts of time of the Companyís internal staff and services and may, with the approval of the full Board, hire independent consultants, including counsel, to assist and advise the Committee in connection with its responsibilities.  If the Board so approves, the Committee shall have the sole authority to retain or terminate any such consultant, including the authority to approve the consultant's fees and other retention terms.  The Committee shall not be entitled to use the Company's independent accountants for any assistance unless the Audit Committee shall have determined that the rendering of any services is permissible.