EX-4.1






Exhibit 4.1






     THE SECURITIES REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN
REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR
(II) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH
TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OR QUALIFICATION UNDER
APPLICABLE STATE SECURITIES LAWS.



     SUBJECT TO THE PROVISIONS OF SECTION 10 HEREOF, THIS WARRANT SHALL BE VOID AFTER 5:00 P.M.
EASTERN TIME ON THE FIFTH ANNIVERSARY OF THE CLOSING DATE (THE “EXPIRATION DATE”).



No.                     




MAGELLAN PETROLEUM CORPORATION




WARRANT TO PURCHASE SHARES OF

COMMON STOCK, PAR VALUE $0.01 PER SHARE




     For VALUE RECEIVED, Young Energy Prize S.A., a Luxembourg corporation (“Warrantholder”), is
entitled to purchase, subject to the provisions of this Warrant, from Magellan Petroleum
Corporation, a Delaware corporation (the “Company”), from and after the Closing Date (the “Initial
Exercise Date”) and at any time not later than 5:00 P.M., Eastern time, on the Expiration Date (as
defined above), at an exercise price per share equal to $1.20 (the exercise price in effect being
herein called the “Warrant Price”), 4,347,826 shares (“Warrant Shares”) of the Company’s Common
Stock, par value $0.01 per share (“Common Stock”). The number of Warrant Shares purchasable upon
exercise of this Warrant and the Warrant Price shall be subject to adjustment from time to time as
described herein. Terms not otherwise defined herein have the respective meanings ascribed to them
in the Securities Purchase



 









 







Agreement, dated February ___, 2009 (the “Purchase Agreement”), between the Company and the initial
holder of this Warrant.



     Section 1. Registration. The Company shall maintain books for the transfer and
registration of the Warrant. Upon the initial issuance of this Warrant, the Company shall issue
and register the Warrant in the name of the Warrantholder or its designee.



     Section 2. Transfers. As provided herein, this Warrant may be transferred only
pursuant to a registration statement filed under the Securities Act of 1933, as amended (the
“Securities Act”), or an exemption from such registration. Subject to such restrictions, the
Company shall transfer this Warrant from time to time upon the books to be maintained by the
Company for that purpose, upon surrender hereof for transfer, properly endorsed or accompanied by
appropriate instructions for transfer and such other documents as may be reasonably required by the
Company, including, if required by the Company, an opinion of its counsel to the effect that such
transfer is exempt from the registration requirements of the Securities Act, to establish that such
transfer is being made in accordance with the terms hereof, and a new Warrant shall be issued to
the transferee and the surrendered Warrant shall be canceled by the Company.



     Section 3. Exercise of Warrant. Subject to the provisions hereof, the Warrantholder
may exercise this Warrant, in whole or in part, at any time and from time to time prior to its
expiration upon surrender of the Warrant, together with delivery of a duly executed Warrant
exercise form, in the form attached hereto as Appendix A (the “Exercise Agreement”) and
payment by cash, certified check, or wire transfer of funds (or, in certain circumstances, by
cashless exercise as provided below) of the aggregate Warrant Price for that number of Warrant
Shares then being purchased, to the Company during normal business hours on any business day at the
Company’s principal executive offices (or such other office or agency of the Company as it may
designate by notice to the Warrantholder). The Warrant Shares so purchased shall be deemed to be
issued to the Warrantholder or the Warrantholder’s designee, as the record owner of such shares, as
of the close of business on the date on which this Warrant shall have been surrendered for exercise
(or the date evidence of loss, theft, or destruction thereof and security or indemnity satisfactory
to the Company has been provided to the Company in connection with such exercise), the Warrant
Price shall have been paid and the completed Exercise Agreement shall have been delivered.
Certificates for the Warrant Shares so purchased shall be delivered to the Warrantholder within a
reasonable time, not exceeding three (3) business days, after this



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Warrant shall have been so exercised. The certificates so delivered shall be in such denominations
as may be requested by the Warrantholder and shall be registered in the name of the Warrantholder
or such other name as shall be designated by the Warrantholder, as specified in the Exercise
Agreement. If this Warrant shall have been exercised only in part, then, unless this Warrant has
expired, the Company shall, at its expense, at the time of delivery of such certificates, deliver
to the Warrantholder a new Warrant representing the right to purchase the number of shares with
respect to which this Warrant shall not then have been exercised. As used herein, “business day”
means a day, other than a Saturday or Sunday, on which banks in New York City are open for the
general transaction of business. Each exercise hereof shall constitute the re-affirmation by the
Warrantholder that the representations and warranties contained in Section 3.2 of the Purchase
Agreement are true and correct in all material respects with respect to the Warrantholder as of the
time of such exercise.



     Section 4. Compliance with the Securities Act of 1933. Except as provided in the
Purchase Agreement, the Company may cause the legend set forth on the first page of this Warrant to
be set forth on each Warrant, and a similar legend on any security issued or issuable upon exercise
of this Warrant, unless counsel for the Company is of the opinion as to any such security that such
legend is unnecessary.



     Section 5. Payment of Taxes. The Company will pay any documentary stamp taxes
attributable to the initial issuance of Warrant Shares issuable upon the exercise of the Warrant;
provided, however, that the Company shall not be required to pay any tax or taxes which may be
payable in respect of any transfer involved in the issuance or delivery of any certificates for
Warrant Shares in a name other than that of the Warrantholder in respect of which such shares are
issued, and in such case, the Company shall not be required to issue or deliver any certificate for
Warrant Shares or any Warrant until the person requesting the same has paid to the Company the
amount of such tax or has established to the Company’s reasonable satisfaction that such tax has
been paid. The Warrantholder shall be responsible for income taxes due under federal, state, or
other law, if any such tax is due.



     Section 6. Mutilated or Missing Warrants. In case this Warrant shall be mutilated,
lost, stolen, or destroyed, the Company shall issue in exchange and substitution of and upon
surrender and cancellation of the mutilated Warrant, or in lieu of and substitution for the Warrant
lost, stolen, or destroyed, a new Warrant of like tenor and for the purchase of a like number of



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Warrant Shares, but only upon receipt of evidence reasonably satisfactory to the Company of such
mutilation, loss, theft, or destruction of the Warrant, and with respect to a lost, stolen, or
destroyed Warrant, reasonable indemnity or bond with respect thereto, if requested by the Company.



     Section 7. Reservation of Common Stock. The Company hereby represents and warrants
that there have been reserved, and the Company shall at all applicable times keep reserved until
issued (if necessary) as contemplated by this Section 7, out of the authorized and unissued shares
of Common Stock, sufficient shares to provide for the exercise of the rights of purchase
represented by this Warrant. The Company agrees that all Warrant Shares issued upon due exercise
of the Warrant shall be, at the time of delivery of the certificates for such Warrant Shares, duly
authorized, validly issued, fully paid, and non-assessable shares of Common Stock of the Company.



     Section 8. Adjustments. Subject and pursuant to the provisions of this Section 8, the
Warrant Price and number of Warrant Shares subject to this Warrant shall be subject to adjustment
from time to time as set forth hereinafter.



          (a) If the Company shall, at any time or from time to time while this Warrant is outstanding,
pay a dividend or make a distribution on its Common Stock in shares of Common Stock, subdivide its
outstanding shares of Common Stock into a greater number of shares or combine its outstanding
shares of Common Stock into a smaller number of shares, or issue by reclassification of its
outstanding shares of Common Stock any shares of its capital stock (including any such
reclassification in connection with a consolidation or merger in which the Company is the
continuing corporation), then (i) the Warrant Price in effect immediately prior to the date on
which such change shall become effective shall be adjusted by multiplying such Warrant Price by a
fraction, the numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such change and the denominator of which shall be the number of shares of
Common Stock outstanding immediately after giving effect to such change, and (ii) the number of
Warrant Shares purchasable upon exercise of this Warrant shall be adjusted by multiplying the
number of Warrant Shares purchasable upon exercise of this Warrant immediately prior to the date on
which such change shall become effective by a fraction, the numerator of which shall be the Warrant
Price in effect immediately prior to the date on which such change shall become effective and the
denominator of which shall be the Warrant Price in


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effect immediately after giving effect to such change, calculated in accordance with clause (i)
above. Such adjustments shall be made successively whenever any event listed above shall occur.




          (b) If any capital reorganization, reclassification of the capital stock of the Company,
consolidation or merger of the Company with another corporation in which the Company is not the
survivor, or sale, transfer, or other disposition of all or substantially all of the Company’s
assets to another corporation shall be effected, then, as a condition of such reorganization,
reclassification, consolidation, merger, sale, transfer, or other disposition, lawful and adequate
provision shall be made whereby each Warrantholder shall thereafter have the right to purchase and
receive upon the basis and upon the terms and conditions herein specified and in lieu of the
Warrant Shares immediately theretofore issuable upon exercise of the Warrant, such shares of stock,
securities, or assets as would have been issuable or payable with respect to or in exchange for a
number of Warrant Shares equal to the number of Warrant Shares immediately theretofore issuable
upon exercise of the Warrant, had such reorganization, reclassification, consolidation, merger,
sale, transfer, or other disposition not taken place, and in any such case appropriate provision
shall be made with respect to the rights and interests of each Warrantholder to the end that the
provisions hereof (including, without limitation, provision for adjustment of the Warrant Price)
shall thereafter be applicable, as nearly equivalent as may be practicable in relation to any
shares of stock, securities, or assets thereafter deliverable upon the exercise hereof. The
Company shall not effect any such consolidation, merger, sale, transfer, or other disposition
unless prior to or simultaneously with the consummation thereof the successor corporation (if other
than the Company) resulting from such consolidation or merger, or the corporation purchasing or
otherwise acquiring such assets or other appropriate corporation or entity, shall assume the
obligation to deliver to the Warrantholder, at the last address of the Warrantholder appearing on
the books of the Company, such shares of stock, securities, or assets as, in accordance with the
foregoing provisions, the Warrantholder may be entitled to purchase, and the other obligations
under this Warrant. The provisions of this paragraph (b) shall similarly apply to successive
reorganizations, reclassifications, consolidations, mergers, sales, transfers, or other
dispositions.




          (c) In case the Company shall fix a payment date for the making of a distribution to all
holders of Common Stock (including any such distribution made in connection


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with a consolidation or merger in which the Company is the continuing corporation) of evidences of
indebtedness or assets (other than cash dividends or cash distributions payable out of consolidated
earnings or earned surplus or dividends or distributions referred to in Section 8(a)), or
subscription rights or warrants, the Warrant Price to be in effect after such payment date shall be
determined by multiplying the Warrant Price in effect immediately prior to such payment date by a
fraction, the numerator of which shall be the total number of shares of Common Stock outstanding
multiplied by the Market Price (as defined below) per share of Common Stock immediately prior to
such payment date, less the fair market value (as determined by the Company’s Board of Directors in
good faith) of said assets or evidences of indebtedness so distributed, or of such subscription
rights or warrants, and the denominator of which shall be the total number of shares of Common
Stock outstanding multiplied by such Market Price per share of Common Stock immediately prior to
such payment date. “Market Price” shall mean, as of a particular date (the “Valuation Date”), the
following: (a) if the Common Stock is then listed on a national stock exchange, the closing sale
price of one share of Common Stock on such exchange on the last Trading Day prior to the Valuation
Date; (b) if the Common Stock is then quoted on the National Association of Securities Dealers,
Inc. OTC Bulletin Board (the “Bulletin Board”) or such similar quotation system or association, the
closing sale price of one share of Common Stock on the Bulletin Board or such other quotation
system or association on the last Trading Day prior to the Valuation Date or, if no such closing
sale price is available, the average of the high bid and the low asked price quoted thereon on the
last Trading Day prior to the Valuation Date; (c) if the Common Stock is then included in the “pink
sheets,” the closing sale price of one share of Common Stock on the “pink sheets” on the last
Trading Day prior to the Valuation Date or, if no such closing sale price is available, the average
of the high bid and the low ask price quoted on the “pink sheets” as of the end of the last Trading
Day prior to the Valuation Date; or (d) if the Common Stock is not then listed on a national stock
exchange or quoted on the Bulletin Board, the “pink sheets” or such other quotation system or
association, the fair market value of one share of Common Stock as of the Valuation Date, as
determined in good faith by the Board of Directors of the Company and the Warrantholder. If the
Common Stock is not then listed on a national securities exchange or quoted on the Bulletin Board,
the “pink sheets” or other quotation system or association, the Board of Directors of the Company
shall respond promptly, in writing, to an inquiry by the Warrantholder prior to the exercise
hereunder


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as to the fair market value of a share of Common Stock as determined by the Board of Directors of
the Company. In the event that the Board of Directors of the Company and the Warrantholder are
unable to agree upon the fair market value in respect of subpart (d) of this paragraph, the Company
and the Warrantholder shall jointly select an appraiser who is experienced in such matters. The
decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be
borne equally by the Company and the Warrantholder. Such adjustment shall be made successively
whenever such a payment date is fixed.




          (d) An adjustment to the Warrant Price shall become effective immediately after the payment
date in the case of each dividend or distribution and immediately after the effective date of each
other event which requires an adjustment.




          (e) In the event that, as a result of an adjustment made pursuant to this Section 8, the
Warrantholder shall become entitled to receive any shares of capital stock of the Company other
than shares of Common Stock, the number of such other shares so receivable upon exercise of this
Warrant shall be subject thereafter to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to the Warrant Shares contained in
this Warrant.




          (f) Except as provided in subsection (g) hereof, if and whenever the Company shall issue or
sell, or is, in accordance with any of subsections (f)(l) through (f)(7) hereof, deemed to have
issued or sold, any Additional Shares of Common Stock (as defined below) for no consideration or
for a consideration per share less than 95.8333 percent of the Warrant Price (as the Warrant Price
is adjusted from time to time under this Section 8) (the “Minimum Price”), then and in each such
case (a “Trigger Issuance”), the then-existing Warrant Price shall be reduced as of the close of
business on the effective date of the Trigger Issuance, to a price determined by the formula set
forth below. Such formula is intended to adjust the Warrant Price in a manner which does not
reduce the Warrant Price with respect to the difference between the Warrant Price prior to such
adjustment and 95.8333 percent of such Warrant Price. The formula is as follows:




	 	 	 	 	 	 	 
	 

	 	Adjusted Warrant Price =
	 	(A x B) + D  +  E
	 	
	 

	 	 	 	     A+C	 	 
	 

	 	where	 	 	 	 






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          “A” equals the number of shares of Common Stock outstanding, including
Additional Shares of Common Stock (as defined below) deemed to be issued hereunder,
immediately preceding such Trigger Issuance;




          “B” equals the Minimum Price in effect immediately preceding such Trigger
Issuance;




          “C” equals the number of Additional Shares of Common Stock issued or deemed
issued hereunder as a result of the Trigger Issuance;




          “D” equals the aggregate consideration, if any, received or deemed to be
received by the Company upon such Trigger Issuance; and




          “E” equals 4.1667 percent of the Warrant Price in effect immediately preceding
such Trigger Issuance;


provided, however, that in no event shall the Warrant Price after giving effect to such Trigger
Issuance be greater than the Warrant Price in effect prior to such Trigger Issuance.




     For purposes of this subsection (f), “Additional Shares of Common Stock” shall mean all shares
of Common Stock issued or sold by the Company or deemed to be issued or sold pursuant to this
subsection (f), other than Excluded Issuances (as defined in subsection (g) hereof).



     For purposes of this subsection (f), the following subsections (f)(l) to (f)(7) shall also be
applicable (subject, in each such case, to the provisions of Section 8(g) hereof):




     (f)(1)  Issuance of Rights or Options. In case at any time the Company
shall in any manner grant (directly and not by assumption in a merger or otherwise)
any warrants or other rights to subscribe for or to purchase, or any options for the
purchase of, Common Stock or any stock or security convertible into or exchangeable
for Common Stock (such warrants, rights, or options being called “Options” and such
convertible or exchangeable stock or securities being called “Convertible
Securities”), whether or not such Options or the right to convert or exchange any
such Convertible Securities are immediately exercisable, and the price per share for
which Common Stock is issuable upon the exercise of such Options or upon the
conversion or exchange of such Convertible Securities (determined by dividing (i)
the sum (which sum shall constitute the applicable consideration) of (x) the total
amount, if any, received or receivable by the Company as consideration for the
granting of such Options, plus (y) the aggregate



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amount of additional consideration payable to the Company upon the exercise of all
such Options, plus (z), in the case of such Options which relate to Convertible
Securities, the aggregate amount of additional consideration, if any, payable upon
the issuance or sale of such Convertible Securities and upon the conversion or
exchange thereof, by (ii) the total maximum number of shares of Common Stock
issuable upon the exercise of such Options or upon the conversion or exchange of all
such Convertible Securities issuable upon the exercise of such Options) shall be
less than the Minimum Price in effect immediately prior to the time of the granting
of such Options, then the total number of shares of Common Stock issuable upon the
exercise of such Options or upon conversion or exchange of the total amount of such
Convertible Securities issuable upon the exercise of such Options shall be deemed to
have been issued for such price per share as of the date of the granting of such
Options or the issuance of such Convertible Securities and thereafter shall be
deemed to be outstanding for purposes of adjusting the Warrant Price. Except as
otherwise provided in subsection 8(f)(3), no adjustment of the Warrant Price shall
be made upon the actual issuance of such Common Stock or of such Convertible
Securities upon exercise of such Options or upon the actual issuance of such Common
Stock upon conversion or exchange of such Convertible Securities.




     (f)(2) Issuance of Convertible Securities. In case the Company shall
in any manner issue (directly and not by assumption in a merger or otherwise) or
sell any Convertible Securities, whether or not the rights to exchange or convert
any such Convertible Securities are immediately exercisable, and the price per share
for which Common Stock is issuable upon such conversion or exchange (determined by
dividing (i) the sum (which sum shall constitute the applicable consideration) of
(x) the total amount received or receivable by the Company as consideration for the
issuance or sale of such Convertible Securities, plus (y) the aggregate amount of
additional consideration, if any, payable to the Company upon the conversion or
exchange thereof, by (ii) the total number of shares of Common Stock issuable upon
the conversion or exchange of all such Convertible Securities) shall be less than
the Minimum Price in effect immediately prior to the



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time of such issuance or sale, then the total maximum number of shares of Common
Stock issuable upon conversion or exchange of all such Convertible Securities shall
be deemed to have been issued for such price per share as of the date of the
issuance or sale of such Convertible Securities and thereafter shall be deemed to be
outstanding for purposes of adjusting the Warrant Price, provided that (a) except as
otherwise provided in subsection 8(f)(3), no adjustment of the Warrant Price shall
be made upon the actual issuance of such Common Stock upon conversion or exchange of
such Convertible Securities and (b) no further adjustment of the Warrant Price shall
be made by reason of the issuance or sale of Convertible Securities upon exercise of
any Options to purchase any such Convertible Securities for which adjustments of the
Warrant Price have been made pursuant to the other provisions of subsection 8(f).




     (f)(3) Change in Option Price or Conversion Rate. Upon the happening
of any of the following events, namely, if the purchase price provided for in any
Option referred to in subsection 8(f)(l) hereof, the additional consideration, if
any, payable upon the conversion or exchange of any Convertible Securities referred
to in subsections 8(f)(l) or 8(f)(2), or the rate at which Convertible Securities
referred to in subsections 8(f)(l) or 8(f)(2) are convertible into or exchangeable
for Common Stock shall change at any time (including, but not limited to, changes
under or by reason of provisions designed to protect against dilution), the Warrant
Price in effect at the time of such event shall forthwith be readjusted to the
Warrant Price which would have been in effect at such time had such Options or
Convertible Securities still outstanding provided for such changed purchase price,
additional consideration, or conversion rate, as the case may be, at the time
initially granted, issued, or sold. On the termination of any Option for which any
adjustment was made pursuant to this subsection 8(f) or any right to convert or
exchange Convertible Securities for which any adjustment was made pursuant to this
subsection 8(f) (including without limitation upon the redemption or purchase for
consideration of such Convertible Securities by the Company), the Warrant Price then
in effect hereunder shall forthwith be changed to the Warrant Price which would have
been in effect at the time of such termination had such Option



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or Convertible Securities, to the extent outstanding immediately prior to such
termination, never been issued.




     (f)(4) Stock Dividends. Subject to the provisions of this Section
8(f), in case the Company shall declare a dividend or make any other distribution
upon any stock of the Company (other than the Common Stock) payable in Common Stock,
Options, or Convertible Securities, then any Common Stock, Options, or Convertible
Securities, as the case may be, issuable in payment of such dividend or distribution
shall be deemed to have been issued or sold without consideration; provided, that if
any adjustment is made to the Warrant Price as a result of a declaration of a
dividend and such dividend is rescinded, the Warrant Price shall be appropriately
readjusted to the Warrant Price in effect had such dividend not been declared.




     (f)(5) Consideration for Stock. In case any shares of Common Stock,
Options, or Convertible Securities shall be issued or sold for cash, the
consideration received therefor shall be deemed to be the gross amount received by
the Company therefor. In case any shares of Common Stock, Options, or Convertible
Securities shall be issued or sold for a consideration other than cash, the amount
of the consideration other than cash received by the Company shall be deemed to be
the fair value of such consideration as determined in good faith by the Board of
Directors of the Company. In case any Options shall be issued in connection with
the issuance and sale of other securities of the Company, together comprising one
integral transaction in which no specific consideration is allocated to such Options
by the parties thereto, such Options shall be deemed to have been issued for such
consideration as determined in good faith by the Board of Directors of the Company.
If Common Stock, Options, or Convertible Securities shall be issued or sold by the
Company and, in connection therewith, other Options or Convertible Securities (the
“Additional Rights”) are issued, then the consideration received or deemed to be
received by the Company shall be reduced by the fair market value of the Additional
Rights (as determined using the Black-Scholes option pricing model or another method
mutually agreed to by the Company and the Warrantholder). The Board of Directors of
the Company shall



-11-









 







respond promptly, in writing, to an inquiry by the Warrantholder as to the fair
market value of the Additional Rights. In the event that the Board of Directors of
the Company and the Warrantholder are unable to agree upon the fair market value of
the Additional Rights, the Company and the Warrantholder shall jointly select an
appraiser who is experienced in such matters. The decision of such appraiser shall
be final and conclusive, and the cost of such appraiser shall be borne evenly by the
Company and the Warrantholder.




     (f)(6) Record Date. In case the Company shall take a record of the
holders of its Common Stock for the purpose of entitling them (i) to receive a
dividend or other distribution payable in Common Stock, Options, or Convertible
Securities, or (ii) to subscribe for or purchase Common Stock, Options, or
Convertible Securities, then such record date shall be deemed to be the date of the
issuance or sale of the shares of Common Stock deemed to have been issued or sold
upon the declaration of such dividend or the making of such other distribution or
the date of the granting of such right of subscription or purchase, as the case may
be.




     (f)(7) Treasury Shares. 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 or any of its wholly-owned subsidiaries, and the disposition
of any such shares (other than the cancellation or retirement thereof) shall be
considered an issuance or sale of Common Stock for the purpose of this subsection
(f).



          (g) Anything herein to the contrary notwithstanding, the Company shall not be required to make
any adjustment of the Warrant Price in the case of the issuance of (A) capital stock, Options, or
Convertible Securities issued to directors, officers, employees, or consultants of the Company in
connection with their service as directors or officers of the Company, their employment by the
Company, or their retention as consultants by the Company pursuant to an equity compensation
program approved by the Board of Directors of the Company or the compensation committee of the
Board of Directors of the Company, (B) shares of Common Stock issued upon the conversion or
exercise of Options or Convertible Securities issued prior to the date hereof, provided such
securities are not amended after the date hereof to increase the number of shares of Common Stock
issuable thereunder or to lower the exercise or conversion


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price thereof, (C) securities issued pursuant to the Purchase Agreement and securities issued upon
the exercise or conversion of those securities, and (D) shares of Common Stock issued or issuable
by reason of a dividend, stock split, or other distribution on shares of Common Stock (but only to
the extent that such a dividend, split, or distribution results in an adjustment in the Warrant
Price pursuant to the other provisions of this Warrant) (collectively, “Excluded Issuances”).




          (h) Upon any adjustment to the Warrant Price pursuant to Section 8(f) above, the number of
Warrant Shares purchasable hereunder shall be adjusted by multiplying such number by a fraction,
the numerator of which shall be the Warrant Price in effect immediately prior to such adjustment
and the denominator of which shall be the Warrant Price in effect immediately thereafter.




          (i) To the extent permitted by applicable law and the listing requirements of any stock market
or exchange on which the Common Stock is then listed, the Company from time to time may decrease
the Warrant Price by any amount for any period of time if the period is at least twenty (20) days,
the decrease is irrevocable during the period, and the Board shall have made a determination that
such decrease would be in the best interests of the Company, which determination shall be
conclusive. Whenever the Warrant Price is decreased pursuant to the preceding sentence, the
Company shall provide written notice thereof to the Warrantholder at least five (5) days prior to
the date the decreased Warrant Price takes effect, and such notice shall state the decreased
Warrant Price and the period during which it will be in effect.




     Section 9. Fractional Interest. The Company shall not be required to issue fractions
of Warrant Shares upon the exercise of this Warrant. If any fractional share of Common Stock
would, except for the provisions of the first sentence of this Section 9, be deliverable upon such
exercise, the Company, in lieu of delivering such fractional share, shall pay to the exercising
Warrantholder an amount in cash equal to the Market Price of such fractional share of Common Stock
on the date of exercise.



     Section 10. Extension of Expiration Date. If the Company fails to cause any
Registration Statement covering Registrable Securities (unless otherwise defined herein,
capitalized terms are as defined in the Registration Rights Agreement relating to the Warrant
Shares (the “Registration Rights Agreement”)) to be declared effective prior to the applicable
dates set forth therein, or if the effectiveness of a Registration Statement has been delayed or a



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Prospectus has been unavailable, and such delay or unavailability (whether alone, or in combination
with any other period of delay or unavailability) continues for more than 60 days in any 12 month
period, or for more than a total of 90 days, then the Expiration Date of this Warrant shall be
extended one day for each day beyond the 60-day or 90-day limits, as the case may be, that such
delay or unavailability continues.



     Section 11. Benefits. Nothing in this Warrant shall be construed to give any person,
firm, or corporation (other than the Company and the Warrantholder) any legal or equitable right,
remedy, or claim, it being agreed that this Warrant shall be for the sole and exclusive benefit of
the Company and the Warrantholder.



     Section 12. Notices to Warrantholder. Upon the happening of any event requiring an
adjustment of the Warrant Price, the Company shall promptly give written notice thereof to the
Warrantholder at the address appearing in the records of the Company, stating the adjusted Warrant
Price and the adjusted number of Warrant Shares resulting from such event and setting forth in
reasonable detail the method of calculation and the facts upon which such calculation is based.
Failure to give such notice to the Warrantholder or any defect therein shall not affect the
legality or validity of the subject adjustment.



     Section 13. Identity of Transfer Agent. The Transfer Agent for the Common Stock is
________. Upon the appointment of any subsequent transfer agent for the Common Stock or
other shares of the Company’s capital stock issuable upon the exercise of the rights of purchase
represented by the Warrant, the Company will mail to the Warrantholder a statement setting forth
the name and address of such transfer agent.



     Section 14. Notices. Unless otherwise provided, any notice required or permitted
under this Warrant shall be given in writing and shall be deemed effectively given as hereinafter
described (i) if given by personal delivery, then such notice shall be deemed given upon such
delivery, (ii) if given by telex or facsimile, then such notice shall be deemed given upon receipt
of confirmation of complete transmittal, (iii) if given by mail, then such notice shall be deemed
given upon the earlier of (A) receipt of such notice by the recipient or (B) three days after such
notice is deposited in first class mail, postage prepaid, and (iv) if given by an internationally
recognized overnight air courier, then such notice shall be deemed given one business day after
delivery to such carrier. All notices shall be addressed as follows: if to the Warrantholder, at
its address as set forth in the Company’s books and records and, if to the Company, at the address
as



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follows, or at such other address as the Warrantholder or the Company may designate by ten days’
advance written notice to the other:



                    If to the Company:


Magellan Petroleum Corporation

10 Columbus Boulevard

Hartford, CT 06106

Facsimile: (860) 293-2349

Attention: Walter McCann, Chairman




     Section 15. Registration Rights. The initial Warrantholder is entitled to the benefit
of certain registration rights with respect to the shares of Common Stock issuable upon the
exercise of this Warrant as provided in the Registration Rights Agreement, and any subsequent
Warrantholder may be entitled to such rights.



     Section 16.  Successors. All the covenants and provisions hereof by or for the
benefit of the Warrantholder shall bind and inure to the benefit of its respective successors and
assigns hereunder.



     Section 17. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This
Warrant shall be governed by, and construed in accordance with, the internal laws of the State of
Delaware, without reference to the choice of law provisions thereof. The Company and, by accepting
this Warrant, the Warrantholder, each irrevocably submits to the exclusive jurisdiction of the
courts of Delaware for the purpose of any suit, action, proceeding, or judgment relating to or
arising out of this Warrant and the transactions contemplated hereby. Service of process in
connection with any such suit, action, or proceeding may be served on each party hereto anywhere in
the world by the same methods as are specified for the giving of notices under this Warrant. The
Company and, by accepting this Warrant, the Warrantholder, each irrevocably consents to the
jurisdiction of any such court in any such suit, action, or proceeding, and to the laying of venue
in such court. The Company and, by accepting this Warrant, the Warrantholder, each irrevocably
waives any objection to the laying of venue of any such suit, action, or proceeding brought in such
courts and irrevocably waives any claim that any such suit, action, or proceeding brought in any
such court has been brought in an inconvenient forum. EACH OF THE COMPANY AND, BY ITS ACCEPTANCE
HEREOF, THE WARRANTHOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY



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LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY
AS TO THIS WAIVER.



     Section 18. Cashless Exercise. Notwithstanding any other provision contained herein
to the contrary, the Warrantholder may elect at any time and from time to time to receive, without
the payment by the Warrantholder of the aggregate Warrant Price in respect of the shares of Common
Stock to be acquired, shares of Common Stock of equal value to the value of this Warrant, or any
specified portion hereof, by the surrender of this Warrant (or such portion of this Warrant being
so exercised) together with a Net Issue Election Notice, in the form annexed hereto as Appendix B,
duly executed, to the Company. Thereupon, the Company shall issue to the Warrantholder such number
of fully paid, validly issued, and nonassessable shares of Common Stock as is computed using the
following formula:



X = Y (A - B)

        A





where




     X = the number of shares of Common Stock to which the Warrantholder is entitled
upon such cashless exercise;




     Y = the total number of shares of Common Stock covered by this Warrant for
which the Warrantholder has surrendered purchase rights at such time for cashless
exercise (including both shares to be issued to the Warrantholder and shares as to
which the purchase rights are to be canceled as payment therefor);




     A = the Market Price of one share of Common Stock as at the date the net issue
election is made; and




     B = the Warrant Price in effect under this Warrant at the time the net issue
election is made.



     Section 19. No Rights as Stockholder. Prior to the exercise of this Warrant, the
Warrantholder shall not have or exercise any rights as a stockholder of the Company by virtue of
its ownership of this Warrant.



     Section 20. Amendment; Waiver Any term of this Warrant may be amended or waived
(including the adjustment provisions included in Section 8 of this Warrant) upon the written
consent of the Company and the Warrantholder.



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     Section 21. Section Headings. The section headings in this Warrant are for the
convenience of only and in no way alter, modify, amend, limit, or restrict the provisions
hereof.



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     IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed, as of the                     
day of                               , 2009.



	 	 	 	 	 
	 	MAGELLAN PETROLEUM CORPORATION

 	 
	 	By:  	 	 
	 	Name:  	Walter McCann 	 
	 	Title:	Chairman 	 



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APPENDIX A

MAGELLAN PETROLEUM CORPORATION

WARRANT EXERCISE FORM




To Magellan Petroleum Corporation:





     The undersigned hereby irrevocably elects to exercise the right of purchase represented by the
within Warrant (“Warrant”) for, and to purchase thereunder by the payment of the Warrant Price and
surrender of the Warrant,                                          shares of Common Stock (“Warrant Shares”) provided for
therein, and requests that certificates for the Warrant Shares be issued as follows:



	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Address:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Federal Tax ID Or Social Security No.:	 	 	 	 
	 

	 	 	 	 

	 	 






     and delivered by




                     (certified mail to the above address, or




                     (electronically
(provide DWAC Instructions:                                         ), or




                    
(other (specify):                                             
                                               ).


and, if the number of Warrant Shares shall not be all the Warrant Shares purchasable upon exercise
of the Warrant, that a new Warrant for the balance of the Warrant Shares purchasable upon exercise
of this Warrant be registered in the name of the undersigned Warrantholder or the undersigned’s
Assignee as below indicated and delivered to the address stated below.




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Note: The signature must correspond with the name of the Warrantholder as written on the first
page of the Warrant in every particular, without alteration or enlargement or any change whatever,
unless the Warrant has been assigned.




	 	 	 	 	 	 	 
	Dated:

	 	                                        , _______
	 	Signature:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	Name (please print)
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	Address
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	Federal Identification or Social Security No.
	 
	 	 	 	 	 	 
	 	 	 	 	Assignee:
	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 





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APPENDIX B

MAGELLAN PETROLEUM CORPORATION

NET ISSUE ELECTION NOTICE




To: Magellan Petroleum Corporation




Date:                                        




     The undersigned hereby elects under Section 18 of this Warrant to surrender the right
to purchase                      shares of Common Stock pursuant to this Warrant and hereby requests the
issuance of                      shares of Common Stock. The certificate(s) for the shares issuable upon
such net issue election shall be issued in the name of the undersigned or as otherwise indicated
below.



	 	 	 
	 

Signature

	 	 
	 
	 	 
	 

Name for Registration

	 	 
	 
	 	 
	 

Mailing Address

	 	 







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