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GULFPORT ENERGY CORPORATION
 
2005 STOCK INCENTIVE PLAN
 
STOCK OPTION EXERCISE AGREEMENT
 

This Stock Option Exercise Agreement (the “Exercise Agreement”) is made and
entered into as of _________________ (the “Effective Date”), by and between
Gulfport Energy Corporation, a Delaware corporation (the “Company”), and the
purchaser named below (the “Purchaser”). Capitalized terms not defined herein
shall have the meanings ascribed to them in the Company’s 2005 Stock Incentive
Plan (the “Plan”) or the Stock Option Agreement.
 

 
Participant:
 
________________________________
 
   
Social Security Number:
 
________________________________
 
   
Address:
 
________________________________
 
     
________________________________
 
   
Option Shares Being Purchased:
 
________________________________
 
   
Exercise Price Per Share:
 
________________________________
 
   
Date of Grant:
 
________________________________
 
   
Expiration Date:
 
     
Type of Stock Option:
 
o Incentive Stock Option
 
     
o Nonqualified Stock Option
 
 

1.    Exercise of Option.
 
1.1.    Exercise. Pursuant to exercise of that certain option (the “Option”)
granted to Purchaser under the Plan and the Stock Option Agreement and subject
to the terms and conditions of this Exercise Agreement, Purchaser hereby
purchases from the Company, and the Company hereby sells to Purchaser, the Total
Number of Shares set forth above (the “Shares”) of the Company’s Common Stock at
the Exercise Price Per Share set forth above (the “Exercise Price”). As used in
this Exercise Agreement, the term “Shares” refers to the Shares purchased under
this Exercise Agreement and includes all securities received (a) in replacement
of the Shares, (b) as a result of stock dividends or stock splits with respect
to the Shares, and (c) all securities received in replacement of the Shares in a
merger, recapitalization, reorganization or similar corporate transaction.
 
1.2.    Title to Shares. The exact spelling of the name(s) under which Purchaser
will take title to the Shares is:
                                   

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Purchaser desires to take title to the Shares as follows:
 
o    Individual, as separate property
 
o    Husband and wife, as community property
 
o    Joint Tenants
 
o    Other; please specify:                            
 

1.3.    Payment. Purchaser hereby delivers payment of the Exercise Price:
 
o    in cash (by check), whether or not acquired through a loan from the
Company, in the amount of $_________, receipt of which is acknowledged by the
Company;
 
o    by a broker assisted cashless exercise procedure that has been approved by
the Company;
 
o    by tender of _______ shares of the Company’s Common Stock that has been
owned for at least six months in a Stock-for-Stock exercise;
 
o    by delivery of a promissory note payable to the Company, in the amount of
$_________; or
 
o    other method or form of consideration that is acceptable to the Plan
Administrator in its sole discretion.
 
Payment of the Exercise Price in any form other than cash is subject to the
advance approval of the Plan Administrator in its sole discretion.
 
2.    Delivery.
 
2.1.    Deliveries by Purchaser. Purchaser hereby delivers to the Company (a)
this Exercise Agreement, (b) if Purchaser is married, a consent of spouse in the
form of Exhibit A attached hereto executed by Purchaser’s spouse, (c) the
Exercise Price and payment or other provision for any applicable tax obligations
in the form of a check, or, if permitted under applicable law and permitted by
the Administrator, a secured full recourse promissory note (“Note”) and (d) if
the Purchaser has provided a Note for exercise of the Shares, a stock pledge
agreement executed by Purchaser (“Pledge Agreement”) and two (2) copies of a
blank stock power (“Stock Power”), both executed by Purchaser (and Purchaser’s
spouse, if any).
 

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2.2.    Deliveries by the Company. Upon its receipt of the Exercise Price,
payment or other provision for any applicable tax obligations and all the
documents to be executed and delivered by Purchaser to the Company under Section
2.1 hereof, the Company will issue a duly executed stock certificate evidencing
the Shares in the name of Purchaser, provided, however, if the Purchaser has
provided a Note for exercise of the Shares, such stock certificate shall be
placed in escrow as provided in Section 10 hereof to secure payment of
Purchaser’s obligation under the Note.
 
3.    Representations and Warranties of Purchaser. Purchaser represents and
warrants to the Company that:
 
3.1.    Agrees to Terms of the Plan. Purchaser has received a copy of the Plan
and the Stock Option Agreement, has read and understands the terms of the Plan,
the Stock Option Agreement and this Exercise Agreement, and agrees to be bound
by their terms and conditions. Purchaser acknowledges that there may be adverse
tax consequences upon exercise of the Option or disposition of the Shares, and
that Purchaser should consult a tax advisor prior to such exercise or
disposition.
 
3.2.    SEC Rule 144. Purchaser understands that Rule 144 promulgated under the
Securities Act may indefinitely restrict transfer of the Shares so long as
Purchaser remains an “affiliate” of the Company or if “current public
information” about the Company (as defined in Rule 144) is not publicly
available.
 
4.    Compliance with Securities Laws. Purchaser understands and acknowledges
that, notwithstanding any other provision of the Stock Option Agreement to the
contrary, the exercise of any rights to purchase any Shares is expressly
conditioned upon compliance with the Securities Act and all applicable state
securities laws. Purchaser agrees to cooperate with the Company to ensure
compliance with such laws.
 
5.    Rights as a Stockholder. Subject to the terms and conditions of this
Exercise Agreement, Purchaser will have all of the rights of a stockholder of
the Company with respect to the Shares from and after the date that Shares are
issued to Purchaser until such time as Purchaser disposes of the Shares.
 
6.    Escrow. If the Purchaser has provided a Note for exercise of the Shares,
as security for Purchaser’s faithful performance of this Exercise Agreement,
Purchaser agrees, immediately upon receipt of the stock certificate(s)
evidencing the Shares, to deliver such certificate(s), together with the Stock
Powers executed by Purchaser and by Purchaser’s spouse, if any (with the date
and number of Shares left blank), to the Secretary of the Company or other
designee of the Company (the “Escrow Holder”), who is hereby appointed to hold
such certificate(s) and Stock Powers in escrow and to take all such actions and
to effectuate all such transfers and/or releases of such Shares as are in
accordance with the terms of this Exercise Agreement. Purchaser and the Company
agree that Escrow Holder will not be liable to any party to this Exercise
Agreement (or to any other party) for any actions or omissions unless Escrow
Holder is grossly negligent or intentionally fraudulent in carrying out the
duties of Escrow Holder under this Exercise Agreement. Escrow Holder may rely
upon any letter, notice or other document executed with any signature purported
to be genuine and may rely on the advice of counsel and obey any order of any
court with respect to the transactions contemplated by this Exercise Agreement.
The Shares will remain in escrow so long as they are subject to the Pledge
Agreement.
 

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7.    Tax Consequences. PURCHASER UNDERSTANDS THAT PURCHASER MAY SUFFER ADVERSE
TAX CONSEQUENCES AS A RESULT OF PURCHASER’S PURCHASE OR DISPOSITION OF THE
SHARES. PURCHASER REPRESENTS: (a) THAT PURCHASER HAS CONSULTED WITH ANY TAX
ADVISOR THAT PURCHASER DEEMS ADVISABLE IN CONNECTION WITH THE PURCHASE OR
DISPOSITION OF THE SHARES AND (b) THAT PURCHASER IS NOT RELYING ON THE COMPANY
FOR ANY TAX ADVICE. IN ADDITION TO THE FOREGOING, THE COMPANY SHALL HAVE NO
LIABILITY TO ANY PARTICIPANT OR ANY OTHER PERSON IF AN OPTION DESIGNATED AS AN
INCENTIVE STOCK OPTION FAILS TO QUALIFY AS SUCH AT ANY TIME OR IF AN OPTION IS
DETERMINED TO CONSTITUTE “NONQUALIFIED DEFERRED COMPENSATION” WITHIN THE MEANING
OF SECTION 409A OF THE CODE AND THE TERMS OF SUCH OPTION DO NOT SATISFY THE
ADDITIONAL CONDITIONS APPLICABLE TO NONQUALIFIED DEFERRED COMPENSATION UNDER
SECTION 409A OF THE CODE AND SECTION 7 OF THE PLAN.
 
8.    Compliance with Laws and Regulations. The issuance and transfer of the
Shares will be subject to and conditioned upon compliance by the Company and
Purchaser with all applicable state, local and U.S. Federal laws and regulations
and with all applicable requirements of any stock exchange or automated
quotation system on which the Company’s Common Stock may be listed or quoted at
the time of such issuance or transfer.
 
9.    Obligation To Sell. Notwithstanding anything herein to the contrary, if at
any time following Optionee’s acquisition of shares of Stock hereunder,
stockholders of the Company owning 51% or more of the shares of the Company (on
a fully diluted basis) (the “Control Sellers”) enter into an agreement
(including any agreement in principal) to transfer all of their shares to any
person or group of persons who are not affiliated with the Control Sellers, such
Control Sellers may require each stockholder who is not a Control Seller (a
“Non-Control Seller”) to sell all of their shares to such person or group of
persons at a price and on terms and conditions the same as those on which such
Control Sellers have agreed to sell their shares, other than terms and
conditions relating to the performance or non-performance of services. For the
purposes of the preceding sentence, an affiliate of a Control Seller is a person
who controls, which is controlled by, or which is under common control with, the
Control Seller.
 
10.    Stockholders’ Agreement. As a condition to the issuance of Stock pursuant
to the exercise of a Stock Option Agreement, the Administrator shall require the
Participant to execute and become a party to the Gulfport Energy Corporation
Stockholders’ Agreement by and among the Company and certain Stockholders of the
Company substantially in the form of Exhibit B attached hereto, which, among
other matters, provides for certain rights and obligations of the Stockholders
of the Company according to the terms such agreement then in effect and as from
time to time may be amended on or after the Award (the “Stockholders’
Agreement”) or any similar agreement then in place during any period during
which the Common Stock is not publicly traded. If the Participant becomes a
party to a Stockholders’ Agreement, in addition to the terms of the Plan and
this Stock Option Agreement, the terms and conditions of the Stockholders’
Agreement shall govern Participant’s rights in and to the Stock; and if there is
any conflict between the provisions of the Stockholders’ Agreement and the Plan
or any conflict between the provisions of the Stockholders’ Agreement the Stock
Option Agreement or this Stock Option Exercise Agreement, the provisions of the
Stockholders’ Agreement shall be controlling.
 

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11.    Successors and Assigns. The Company may assign any of its rights under
this Exercise Agreement. This Exercise Agreement shall be binding upon and inure
to the benefit of the successors and assigns of the Company. This exercise
Agreement will be binding upon Purchaser and Purchaser’s heirs, executors,
administrators, legal representatives, successors and assigns.
 
12.    Governing Law; Severability. This Exercise Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware without
giving effect to its conflict of law principles. If any provision of this
Exercise Agreement is determined by a court of law to be illegal or
unenforceable, then such provision will be enforced to the maximum extent
possible and the other provisions will remain fully effective and enforceable.
 
13.    Notices. Any notice required to be given or delivered to the Company
shall be in writing and addressed to the Corporate Secretary of the Company at
its principal corporate offices. Any notice required to be given or delivered to
Purchaser shall be in writing and addressed to Purchaser at the address
indicated above or to such other address as Purchaser may designate in writing
from time to time to the Company. All notices shall be deemed effectively given
upon personal delivery, (a) five (5) days after deposit in the United States
mail by certified or registered mail (return receipt requested), (b) two (2)
business day after its deposit with any return receipt express courier
(prepaid), or (c) one (1) business day after transmission by facsimile.
 
14.    Further Instruments. The parties agree to execute such further
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this Exercise Agreement.
 
15.    Headings. The captions and headings of this Exercise Agreement are
included for ease of reference only and will be disregarded in interpreting or
construing this Exercise Agreement.
 
16.    Entire Agreement. The Plan, the Stock Option Agreement, this Exercise
Agreement, together with all Exhibits thereto, and the Stockholders’ Agreement
constitute the entire agreement and understanding of the parties with respect to
the subject matter of this Exercise Agreement, and supersede all prior
understandings and agreements, whether oral or written, between the parties
hereto with respect to the specific subject matter hereof. If there is any
inconsistency between the terms of this Exercise Agreement and the terms of the
Plan and Stock Option Agreement, the terms of the Plan and Stock Option
Agreement shall govern and control.
 
[SIGNATURE PAGE FOLLOWS]
 

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IN WITNESS WHEREOF, the Company has caused this Exercise Agreement to be
executed in triplicate by its duly authorized representative and Purchaser has
executed this Exercise Agreement in triplicate as of the Effective Date,
indicated above.

        GULFPORT ENERGY CORPORATION  
   
   
  By:   /s/ ____________________________________   Name:
_____________________________   Title: __________________________________

 

        PARTICIPANT  
   
   
  By:   /s/ _____________________________________   (Signature)   Printed Name:
____________________________

 

 

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EXHIBIT A
 
SPOUSE CONSENT
 

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SPOUSE CONSENT
 
The undersigned spouse of ____________________________ (the “Purchaser”) has
read, understands, and hereby approves the Stock Option Exercise Agreement (the
“Agreement”) between Purchaser and Gulfport Energy Corporation, a Delaware
corporation (the “Company”). In consideration of the Company’s granting my
spouse the right to purchase the Shares as set forth in the Agreement, the
undersigned hereby agrees to be irrevocably bound by the Agreement and further
agrees that any community property interest I may have in the Shares shall
similarly be bound by the Agreement. The undersigned hereby appoints Purchaser
as my attorney-in-fact with respect to any amendment or exercise of any rights
under the Agreement.

 
 

    Dated: _______________________    SPOUSE   ____________________________  
(Signature)         Printed Name     Address: _____________________    
_________________________     _________________________

                        
 

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EXHIBIT B
 
STOCKHOLDERS’ AGREEMENT
 

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