mhr_8k-ex0401.htm


    Exhibit 4.1

     

    NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES INTO WHICH THESE SECURITIES ARE
EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR APPLICABLE STATE SECURITIES LAWS.  THE SECURITIES MAY NOT BE
OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A FORM REASONABLY ACCEPTABLE
TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS
SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT.  NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING
ARRANGEMENT SECURED BY THE SECURITIES.

    


    MAGNUM
HUNTER RESOURCES CORPORATION

    


    COMMON
STOCK PURCHASE WARRANT

    


    
      	
              Initial
      Holder:

            	 
      	
              Original
      Issue Date: November 5th,
      2009

            
	 
      	
              No.
      of Shares Subject to Warrant:
      [            ]

            
	 
      	
              Exercise
      Price Per Share: $2.50

            
	 
      	
              Expiration
      Time: 5:00 p.m., Texas
      time, on November 5th, 2012 (subject to acceleration
      as provided herein)

            
	 
      


    

    


    Magnum
Hunter Resources Corporation, a Delaware corporation (the “Company”), hereby certifies
that, for value received, the Initial Holder shown above, or its permitted
registered assigns (the “Holder”), is entitled to
purchase from the Company up to the number of shares of its common stock shown
above (the “Common
Stock”) (each such share, a “Warrant Share” and all such
shares, the “Warrant
Shares”) at the exercise price shown above (as may be adjusted from time
to time as provided herein, the “Exercise Price”), at any time,
and from time to time, after the Warrant Shares are registered with the
Securities and Exchange Commission for resale pursuant to an effective
registration statement  (the “Original Exercise Date”), and
through and including the expiration time shown above (the “Expiration Time”), and subject
to the following terms and conditions:

    


    This
Warrant is being issued pursuant to a Securities Purchase and Registration
Rights Agreement, dated November 5th,
2009 (the “SPA”), by and
between the Company, the Initial Holder and the other parties
thereto.

    


    


    
      
        
           


        

        
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    1.
            Definitions.  In
addition to the terms defined elsewhere in this Warrant, capitalized terms that
are not otherwise defined herein have the meanings given to such terms in the
SPA.

    


    2.            
List of Warrant
Holders.  The Company shall register this Warrant, upon records to
be maintained by the Company for that purpose (the “Warrant Register”), in the
name of the record Holder (which shall include the Initial Holder or, as the
case may be, any registered assignee to which this Warrant is permissibly
assigned hereunder from time to time).  The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose
of any exercise hereof or any distribution to the Holder, and for all other
purposes, absent actual notice to the contrary.

    


    3.
            List of Transfers;
Restrictions on Transfer. The Company shall register any transfer of all
or any portion of this Warrant in the Warrant Register, upon surrender of this
Warrant, with the Form of Assignment attached hereto duly completed and signed,
to the Company at its address specified herein. Upon any such registration or
transfer, a new Warrant to purchase Common Stock, in substantially the form of
this Warrant (any such new Warrant, a “New Warrant”), evidencing the
portion of this Warrant so transferred shall be issued to the transferee and a
New Warrant evidencing the remaining portion of this Warrant not so transferred,
if any, shall be issued to the transferring Holder.  The acceptance of
the New Warrant by the transferee thereof shall be deemed the acceptance by such
transferee of all of the rights and obligations in respect of the New Warrant
that the Holder has in respect of this Warrant.

    


    4.
            Exercise and Duration of
Warrant.

    


    (a)
         All or any part of this Warrant
shall be exercisable by the registered Holder as set forth in Section 10 of
this Warrant at any time and from time to time on or after the Original Exercise
Date and through and including the Expiration Time. Subject to Section 11
hereof, at the Expiration Time, the portion of this Warrant not exercised prior
thereto shall be and become void and of no value and this Warrant shall be
terminated and shall no longer be outstanding.

    


    (b)          
The Holder may exercise this Warrant by delivering to the Company (i) an
exercise notice, in the form attached hereto (the “Exercise Notice”), completed
and duly signed, and (ii) payment of the Exercise Price for the number of
Warrant Shares as to which this Warrant is being exercised.  The date such
items are delivered to the Company (as determined in accordance with the notice
provisions hereof) is an “Exercise Date.”  The
Holder shall not be required to deliver the original Warrant in order to effect
an exercise hereunder, but if it is not so delivered then such exercise shall
constitute an agreement by the Holder to deliver the original Warrant to the
Company as soon as practicable thereafter.  Execution and delivery of the
Exercise Notice shall have the same effect as cancellation of the original
Warrant and issuance of a New Warrant evidencing the right to purchase the
remaining number of Warrant Shares.

    


    


    
      
        
           


        

        
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    (c)          
The Company will not close its stockholder books or records in any manner which
prevents the timely exercise of this Warrant pursuant to the terms
hereof.

    


    5.
           Delivery of Warrant
Shares.

    


    (a)
          Upon exercise of this
Warrant the Company shall promptly (but in no event later than three (3) Trading
Days after the Exercise Date) issue or cause to be issued and cause to be
delivered to or upon the written order of the Holder and in such name or names
as the Holder may designate, a certificate for the Warrant Shares issuable upon
such exercise, free of restrictive legends.  “Trading Day” shall mean a date
on which the Company’s Common Stock trades on its principal trading
market.  The Holder, or any Person permissibly so designated by the
Holder to receive Warrant Shares, shall be deemed to have become the holder of
record of such Warrant Shares as of the Exercise Date.  The Company shall,
upon the written request of the Holder, use its commercially reasonable efforts
to deliver, or cause to be delivered, Warrant Shares hereunder electronically
through the Depository Trust and Clearing Corporation or another established
clearing corporation performing similar functions, if available; provided, that, the Company
may, but will not be required to, change its transfer agent if its current
transfer agent cannot deliver Warrant Shares electronically through the
Depository Trust and Clearing Corporation.  If as of the time of exercise
the Warrant Shares constitute restricted or control securities, the Holder, by
exercising, agrees not to resell them except in compliance with all applicable
securities laws.

    


    (b)
          To the extent permitted
by law, the Company’s obligations to issue and deliver Warrant Shares in
accordance with the terms hereof are absolute and unconditional, irrespective of
any action or inaction by the Holder to enforce the same, any waiver or consent
with respect to any provision hereof, the recovery of any judgment against any
Person or any action to enforce the same, or any setoff, counterclaim,
recoupment, limitation or termination, or any breach or alleged breach by the
Holder or any other Person of any obligation to the Company or any violation or
alleged violation of law by the Holder or any other Person, and irrespective of
any other circumstance that might otherwise limit such obligation of the Company
to the Holder in connection with the issuance of Warrant
Shares.  Nothing herein shall limit a Holder’s right to pursue any
other remedies available to it hereunder, at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief with
respect to the Company’s failure to timely deliver certificates representing
shares of Common Stock upon exercise of the Warrant as required pursuant to the
terms hereof.

    


    (c)
          If the Company fails to
cause its transfer agent to transmit to the Holder a certificate or the
certificates (either physical or electronic) representing the Warrant Shares
pursuant to the terms hereof by applicable delivery date, then, the Holder will
have the right to rescind such exercise.

     

    6.           
Charges, Taxes and
Expenses. Issuance and delivery of certificates for shares of Common
Stock upon exercise of this Warrant shall be made without charge to the Holder
for any issue or transfer tax, withholding tax, transfer agent fee or other
incidental tax or expense in respect of the issuance of such certificates, all
of which taxes and expenses shall be paid by the Company; provided, however, that the
Company shall not be required to pay any tax that may be payable in respect of
any transfer involved in the registration of any certificates for Warrant Shares
or the Warrants in a name other than that of the Holder. The Holder shall be
responsible for all other tax liability that may arise as a result of holding or
transferring this Warrant or receiving Warrant Shares upon exercise
hereof.

    


    
      
        
           


        

        
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    7.           
Replacement of
Warrant.  If this Warrant is mutilated, lost, stolen or destroyed,
the Company shall issue or cause to be issued in exchange and substitution for
and upon cancellation hereof, or in lieu of and substitution for this Warrant, a
New Warrant, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction and customary and reasonable
indemnity, if requested. Applicants for a New Warrant under such circumstances
shall also comply with such other reasonable regulations and procedures and pay
such other reasonable third-party costs as the Company may prescribe. If a New
Warrant is requested as a result of a mutilation of this Warrant, then the
Holder shall deliver such mutilated Warrant to the Company as a condition
precedent to the Company’s obligation to issue the New Warrant.

    


    8.           
Reservation of Warrant
Shares. The Company covenants that it will at all times reserve and keep
available out of the aggregate of its authorized but unissued and otherwise
unreserved Common Stock, solely for the purpose of enabling it to issue Warrant
Shares upon exercise of this Warrant as herein provided, the number of Warrant
Shares that are then issuable and deliverable upon the exercise of this entire
Warrant, free from preemptive rights or any other contingent purchase rights of
persons other than the Holder (taking into account the adjustments and
restrictions of Section 9). The Company covenants that all Warrant Shares so
issuable and deliverable shall, upon issuance and the payment of the applicable
Exercise Price in accordance with the terms hereof, be duly and validly
authorized, issued and fully paid and nonassessable.

    


    9.
            Certain Adjustments;
Termination Under Certain Circumstances. The Exercise Price and number of
Warrant Shares issuable upon exercise of this Warrant are subject to adjustment
from time to time as set forth in this Section 9.

    


    (a)          
Stock Dividends and
Splits. If the Company, at any time while this Warrant is outstanding:
(i) pays a stock dividend on its Common Stock or otherwise makes a distribution
on any class of capital stock that is payable in shares of Common Stock, (ii)
subdivides outstanding shares of Common Stock into a larger number of shares, or
(iii) combines outstanding shares of Common Stock into a smaller number of
shares, then in each such case the Exercise Price shall be multiplied by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding immediately before such event and of which the denominator shall be
the number of shares of Common Stock outstanding immediately after such event.
Any adjustment made pursuant to clause (i) of this paragraph shall become
effective immediately after the record date for the determination of
stockholders entitled to receive such dividend or distribution, and any
adjustment pursuant to clause (ii) or (iii) of this paragraph shall become
effective immediately after the effective date of such subdivision or
combination.

    


    (b)
          Pro Rata
Distributions.  If the Company, at any time while this Warrant is
outstanding, distributes to all holders of Common Stock for no consideration:
(i) evidences of its indebtedness, (ii) any security (other than a distribution
of Common Stock covered by the preceding paragraph), (iii) rights or warrants to
subscribe for or purchase any security, or (iv) any other asset besides cash (in
each case, “Distributed
Property”), then either upon any exercise of this Warrant that occurs
after the record date fixed for determination of stockholders entitled to
receive such distribution or, at the option of the Company, concurrently with
such distribution, the Holder shall be entitled to receive, in addition to the
Warrant Shares otherwise issuable upon such exercise (if applicable), the
Distributed Property that such Holder would have been entitled to receive in
respect of such number of Warrant Shares had the Holder been the record holder
of such Warrant Shares immediately prior to such record date.

    


    
      
        
           


        

        
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    (c)          
Fundamental
Transactions. As used herein, “Fundamental Transaction” means
at any time while this Warrant is outstanding: (i) the Company effects any
merger of the Company with another Person, in which the shareholders of the
Company immediately prior to the transaction own immediately after the
transaction less than a majority of the outstanding stock of the successor
entity, or its parent if applicable, (ii) the Company effects any sale of all or
substantially all of its assets in one or a series of related transactions,
(iii) any tender offer or exchange offer approved or authorized by the Company’s
Board of Directors is completed pursuant to which holders of at least a majority
of the outstanding Common Stock tender or exchange their shares for other
securities, cash or property, or (iv) the Company effects any reclassification
of the Common Stock or any compulsory share exchange pursuant to which the
Common Stock is effectively converted into or exchanged for other securities,
cash or property.  In the event of a Fundamental Transaction pursuant
to which the securities, cash or property issuable with respect to the
outstanding Common Stock consist solely of cash and/or securities traded on a
national securities exchange or an established over-the-counter market (the
“Alternate
Consideration”), this Warrant shall expire immediately prior to the
closing of the Fundamental Transaction.  The Company shall not effect
any such Fundamental Transaction unless prior to or simultaneously with the
consummation thereof, any successor to the Company, surviving entity or the
corporation purchasing or otherwise acquiring such assets or other appropriate
corporation or entity shall assume the obligation to deliver to the Holder, such
Alternate Consideration as, in accordance with the foregoing provisions, the
Holder shall be entitled to receive upon proper exercise of this Warrant prior
to such closing.  In the event of a Fundamental Transaction in which
the consideration does not entirely consist of the Alternate Consideration, the
Company (or the successor entity) shall purchase this Warrant from the Holder by
paying to the Holder, within ten (10) Business Days after the closing of such
Fundamental Transaction cash in an amount equal to the Black Scholes Value (as
reasonably determined by the Board of Directors of the Company or the Company’s
financial advisor in the Fundamental Transaction) of the remaining unexercised
portion of this Warrant on the date of such Fundamental Transaction determined
as of the day of closing of the applicable Fundamental Transaction.

    


    (d)
          Number of Warrant
Shares.  Simultaneously with any adjustment to the Exercise
Price pursuant to paragraph (a) of this Section 9, the number of Warrant Shares
that may be purchased upon exercise of this Warrant shall be increased or
decreased proportionately, so that after such adjustment the aggregate Exercise
Price payable hereunder for the adjusted number of Warrant Shares shall be the
same as the aggregate Exercise Price in effect immediately prior to such
adjustment.

    


    
      
        
           


        

        
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    (e)
          Calculations. All
calculations under this Section 9 shall be made to the nearest cent or the
nearest 1/100th of a share, as applicable. The number of shares of Common Stock
outstanding at any given time shall not include shares owned or held by or for
the account of the Company, and the disposition of any such shares shall be
considered an issue or sale of Common Stock.

    


    (f)
          Notice of
Adjustments. Upon the occurrence of each adjustment pursuant to this
Section 9, the Company at its expense will, at the written request of the
Holder, promptly compute such adjustment in accordance with the terms of this
Warrant and prepare a certificate setting forth such adjustment, in good faith,
including a statement of the adjusted Exercise Price and adjusted number or type
of Warrant Shares or other securities issuable upon exercise of this Warrant (as
applicable), describing the transactions giving rise to such adjustments and
showing in detail the facts upon which such adjustment is based. Upon written
request, the Company will promptly deliver a copy of each such certificate to
the Holder and to the Company’s transfer agent for the Common
Stock.

    


    (g)
          Notice of Corporate
Events. If, while this Warrant is outstanding, the Company (i) declares a
dividend or any other distribution of cash, securities or other property in
respect of its Common Stock, including without limitation any granting of rights
or warrants to subscribe for or purchase any capital stock of the Company or any
Subsidiary, (ii) authorizes or approves, enters into any agreement contemplating
or solicits stockholder approval for any Fundamental Transaction or (iii)
authorizes the voluntary dissolution, liquidation or winding up of the affairs
of the Company, then, except if such notice and the contents thereof shall be
deemed to constitute material non-public information, the Company shall deliver
to the Holder a notice describing the material terms and conditions of such
transaction at least ten (10) Trading Days prior to the applicable record or
effective date on which a Person would need to hold Common Stock in order to
participate in or vote with respect to such transaction, and the Company will
take all reasonable steps to give Holder the practical opportunity to exercise
this Warrant prior to such time; provided, however, that the
failure to deliver such notice or any defect therein shall not affect the
validity of the corporate action required to be described in such
notice.

    


    10.
             Payment of Exercise
Price.  The Holder shall pay the Exercise Price by delivery of
an Exercise Notice, together with immediately available funds, to an account
designated by the Company.

    


    11.            
Redemption by the
Company.  This Warrant may be redeemed by the Company for $0.01
per Warrant Share on no less than five (5) days Trading Days written notice to
the Holder if each of the following conditions are met: (i) the Warrant Shares
are registered with the Securities and Exchange Commission for resale pursuant
to an effective registration statement and (ii) the average trading price of the
Company’s Common Stock as traded or quoted on the applicable Trading Market
equals or exceeds $3.75 for twenty (20) days in any consecutive thirty (30) day
period prior to the Expiration Time.

    


    


    
      
        
           


        

        
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    12.         
No Fractional
Shares. No fractional Warrant Shares will be issued in connection with
any exercise of this Warrant. In lieu of any fractional shares that would
otherwise be issuable, the Company shall pay cash equal to the product of such
fraction multiplied by the closing price of one Warrant Share as reported by the
applicable Trading Market on the Exercise Date.

    


    13.         
Notices.  Any
and all notices or other communications or deliveries hereunder (including,
without limitation, any Exercise Notice) shall be delivered in accordance with
the procedures set forth in Section 7.2 of the SPA.

    


    14.         
Warrant Agent.
The Company shall serve as warrant agent under this Warrant. Upon thirty (30)
days’ notice to the Holder, the Company may appoint a new warrant agent. Any
corporation into which the Company or any new warrant agent may be merged or any
corporation resulting from any consolidation to which the Company or any new
warrant agent shall be a party or any corporation to which the Company or any
new warrant agent transfers substantially all of its assets or its corporate
trust or shareholders services business shall be a successor warrant agent under
this Warrant without any further act. Any such successor warrant agent shall
promptly cause notice of its succession as warrant agent to be mailed (by first
class mail, postage prepaid) to the Holder at the Holder’s last address as shown
on the Warrant Register.

    


    15.
          Miscellaneous.

    


    (a)         
This Warrant shall be binding on and inure to the benefit of the parties hereto
and their respective successors and assigns. Subject to the preceding sentence,
nothing in this Warrant shall be construed to give to any Person other than the
Company and the Holder any legal or equitable right, remedy or cause of action
under this Warrant.  This Warrant may be amended only in writing
signed by the Company and the Holder, or their successors and
assigns.

    


    (b)         
All questions concerning the construction, validity, enforcement and
interpretation of this Warrant shall be governed by and construed and enforced
in accordance with the internal laws of the State of New York, without regard to
the principles of conflicts of law thereof.

    


    (c)
          The headings herein are
for convenience only, do not constitute a part of this Warrant and shall not be
deemed to limit or affect any of the provisions hereof.

    


    (d)         
In case any one or more of the provisions of this Warrant shall be invalid or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Warrant shall not in any way be affected or
impaired thereby and the parties will attempt in good faith to agree upon a
valid and enforceable provision which shall be a commercially reasonable
substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Warrant.

    


    (e)
          Prior to exercise of this
Warrant, the Holder hereof shall not, by reason of being a Holder, be entitled
to any rights of a stockholder with respect to the Warrant Shares.

    


    
      
        
           


        

        
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    (f)
          No provision hereof, in
the absence of any affirmative action by Holder to exercise this Warrant to
purchase Warrant Shares, and no enumeration herein of the rights or privileges
of Holder, shall give rise to any liability of Holder for the purchase price of
any Common Stock or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company.

    


    


    


    [Signature
Page Follows]

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
 

    
      
        
           


        

        
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    IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its
authorized officer as of the date first indicated above.

    


    
    

     

    
      	 	
              MAGNUM
      HUNTER RESOURCES CORPORATION

              


              


              


              By:
      _________________________________

                    Name:

                    Title:

            


    

     

    
 

    


     

     

     

     

     

     

     

     

     

     

     

    


    
      
        
           


        

        
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    MAGNUM
HUNTER RESOURCES CORPORATION

    


    EXERCISE
NOTICE

    


    WARRANT
ORIGINALLY ISSUED NOVEMBER 5th,
2009

    


    Ladies
and Gentlemen:

    


    (1)          
The undersigned hereby elects to exercise the above-referenced Warrant with
respect to
[                          ]
shares of Common Stock.  Capitalized terms used herein and not otherwise
defined herein have the respective meanings set forth in the
Warrant.

    


    (2)          
The payment of the Exercise Price shall be made in accordance with Section
10.

    


    (3)          
The holder shall pay the sum of $ ______________ to the Company in
accordance with the terms of the Warrant.

    


    (4)          
Pursuant to this Exercise Notice, the Company shall deliver to the Holder the
number of Warrant Shares determined in accordance with the terms of the
Warrant.

    


    
      	
              Dated:

            	 
      	 
      	
              HOLDER:

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	
              Print
      name

            
	 
      	 
      	 
      
	 
      	 
      	
              By:

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	
              Title:

            	 
      
	 
      	 
      	 
      	 
      


    

    


    
      
        
           


        

        
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    MAGNUM
HUNTER RESOURCES CORPORATION

    


    WARRANT
ORIGINALLY ISSUED NOVEMBER 5th,
2009

    


    FORM OF
ASSIGNMENT

    To be
completed and signed only upon transfer of Warrant

    


    FOR VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers unto
______________________ the right represented by the within Warrant to purchase
_________ shares of Common Stock to which the within Warrant relates and
appoints __________________ as the undersigned’s attorney to transfer said right
on the books of the Company with full power of substitution in the
premises.

    


    
      	
              Dated:

            	 
      	 
      	
              TRANSFEROR:

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	
              Print
      name

            
	 
      	 
      	 
      
	 
      	 
      	
              By:

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	
              Title:

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	
              TRANSFEREE:

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	
              Print
      name

            
	 
      	 
      	 
      
	 
      	 
      	
              By:

            	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	
              Title:

            	 
      
	
              WITNESS:

            	 
      	 
      	 
      
	 
      	 
      	
              Address
      of Transferee:

            
	 
      	 
      	 
      	 
      
	
              Print
      name

            	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      


    

    


    


     

    


    


    
      
        
           


        

        
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