NON-STATUTORY
STOCK OPTION AGREEMENT
THIS NON-STATUTORY STOCK OPTION AGREEMENT
(“Agreement”) is entered into effective as of August
17, 2009, by and between MAGNUM HUNTER RESOURCES CORPORATION, a
Delaware corporation (“Corporation”), and Jeff Swanson
(“Optionee”).
R E C I T A L
The Corporation wishes to grant Optionee options
to purchase 100,000 shares of the Corporation’s $.01 par
value common stock (“Common Stock”) under the
Corporation’s 2006 Stock Incentive Plan (“Plan”),
on the terms and subject to the conditions set forth
below.
A G R E E M E N T
It is hereby agreed as follows:
1. GRANT
OF OPTIONS. The Corporation hereby grants to Optionee,
options (“Options”) to purchase all or any part of
100,000 shares (“Shares”) of the Corporation’s
Common Stock, upon the terms and subject to the conditions set
forth herein. The Option and the Shares granted and
issued pursuant to this Agreement have been granted and issued
under, and are subject to the terms of, the Plan. The
terms of the Plan are incorporated by reference in this Agreement
in their entirety, and the Optionee, by execution of this
Agreement, acknowledges having received a copy of the
Plan. The provisions of this Agreement will be
interpreted as to be consistent with the Plan, and any ambiguities
in this Agreement will be interpreted by reference to the
Plan. In the event that any provision of this Agreement
is inconsistent with the terms of the Plan, the terms of the Plan
will prevail. All capitalized terms not herein defined
shall have the meanings ascribed to them by the Plan.
2. OPTION
PERIOD. The Options shall vest and become immediately
exercisable on August 17, 2009 and shall expire on August 17, 2019,
unless earlier terminated pursuant to Section 6 of the Agreement
and Section 9 of the Plan.
3. METHOD
OF EXERCISE. The Options shall be exercisable by
Optionee by giving written notice to the Corporation of the
election to purchase and of the number of Shares Optionee elects to
purchase, such notice to be accompanied by such other executed
instruments or documents as may be required by the Corporation
pursuant to this Agreement or the Plan, and unless otherwise
directed by the Corporation, Optionee shall at the time of such
exercise tender the purchase price of the Shares he has elected to
purchase. Optionee may purchase less than the total
number of Shares for which the Option is exercisable, provided that
a partial exercise of an Option may not be for less than One
Hundred (100) Shares. If Optionee shall not purchase all
of the Shares which he is entitled to purchase under the Options,
his right to purchase the remaining unpurchased Shares shall
continue until expiration of the Options. The Options
shall be exercisable with respect of whole Shares only, and
fractional Share interests shall be disregarded.
4. AMOUNT
OF PURCHASE PRICE. The purchase price (“Purchase
Price”) per Share for each Share which Optionee is entitled
to purchase under the Options shall be $1.04 per Share.
5. PAYMENT
OF PURCHASE PRICE. Except as the Corporation may allow
in accordance with the Plan, at the time of Optionee’s notice
of exercise of the Options, Optionee shall tender in cash or by
certified or bank cashier’s check payable to the Corporation,
the purchase price for all Shares then being purchased.
6. EFFECT
OF TERMINATION OF EMPLOYMENT OR OTHER RELATIONSHIP. If
an Optionee’s employment or other relationship with the
Corporation (or a subsidiary) terminates, the effect of the
termination on the Optionee’s rights to acquire Shares shall
be as set forth in Section 9 of the Plan.
7. NONTRANSFERABILITY
OF OPTIONS. The Options shall not be transferable,
either voluntarily or by operation of law, except as provided in
Section 12.3 of the Plan.
8. TIME
OF GRANTING OPTIONS. The time the Options shall be
deemed granted, sometimes referred to herein as the “date of
grant,” shall be August 17, 2009.
9. PRIVILEGES
OF STOCK OWNERSHIP. Optionee shall not be entitled to
the privileges of stock ownership as to any Shares not actually
issued and delivered to Optionee. No Shares shall be
purchased upon the exercise of any Options unless and until, in the
opinion of the Corporation’s counsel, any then applicable
requirements of any laws, or governmental or regulatory agencies
having jurisdiction, and of any exchanges upon which the stock of
the Corporation may be listed shall have been fully complied
with.
10 SECURITIES
LAWS COMPLIANCE. The Corporation will diligently
endeavor to comply with all applicable securities laws before any
stock is issued pursuant to the Options. Without
limiting the generality of the foregoing, the Corporation may
require from the Optionee such investment representation or such
agreement, if any, as counsel for the Corporation may consider
necessary in order to comply with the Securities Act of 1933 as
then in effect, and may require that the Optionee agree that any
sale of the Shares will be made only in such manner as is permitted
by the Corporation. The Corporation may in its
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