Document:

EX-10.2

Exhibit 10.2

INDEMNIFICATION AGREEMENT

     This Indemnification Agreement (this “Agreement”) is made as of the 3rd day of
February, 2009, by and between Magellan Petroleum Corporation, a Delaware corporation (the
“Company”), and William H. Hastings, an individual residing at 2 Thurston Lane, Falmouth, Maine
04105 (the “Indemnitee”).

Recitals

     A. The Indemnitee became a director, officer and employee of the Company on December 11, 2008
(the “Effective Date”) and in such capacities is performing valuable services for the Company.

     B. The Delaware General Corporation Law, as amended from time to time (the “DGCL”), permits
the Company to indemnify the officers, directors, employees and agents of the Company.

     C. The Company desires to hold harmless and indemnify the Indemnitee to the fullest extent
authorized or permitted by the provisions of the DGCL, or by any amendment thereof or other
statutory provisions authorizing or permitting such indemnification which hereafter may be adopted.

     D. The Company has entered into this Agreement and has assumed the obligations imposed on the
Company hereby in order to induce the Indemnitee to serve or to continue to serve as a director,
officer and employee of the Company, and acknowledges that the Indemnitee is relying upon this
Agreement in serving or continuing to serve in such capacities.

Agreement

     Accordingly, in consideration of the Indemnitee’s agreement to serve or continue to serve as a
director and/or officer of the Company, the Company and the Indemnitee agree as follows:

     1. Initial Indemnification.

          (a) General. From and after the Effective Date, the Company shall indemnify the
Indemnitee to the fullest extent permitted by applicable law whenever he was or is, or is
threatened to be made, a party to or a participant in any threatened, pending or completed action,
suit, arbitration, alternative dispute resolution mechanism, investigation, inquiry, administrative
hearing or any other actual, threatened or completed proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the Company to procure
a judgment in its favor), by reason of the fact that he is or was a director, officer, employee or
agent of the Company, or is or was serving at the request of the Company as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or other enterprise, or
by reason of any action alleged to have been taken or omitted in any such capacity, against any and
all expenses (including, without limitation, attorneys’ fees and expenses), judgments, fines,
amounts paid in settlements and other amounts actually and reasonably incurred by the

 

 

Indemnitee or on his behalf in connection with such action, suit or proceeding and any appeal
therefrom or any claim, issue or matter therein if the Indemnitee acted in good faith and in a
manner which he reasonably believed to be in or not opposed to the best interests of the Company
and, with respect to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere or its equivalent shall not, of itself,
create a presumption that the Indemnitee did not satisfy the foregoing standard of conduct to the
extent applicable thereto.

          (b) Derivative Actions. From and after the Effective Date, the Company shall indemnify
the Indemnitee to the fullest extent permitted by applicable law when he was or is, or is
threatened to be made, a party to or a participant in any threatened, pending or completed action,
suit, arbitration, alternative dispute resolution mechanism, investigation, inquiry, administrative
hearing or any other actual, threatened or completed proceeding, whether civil, criminal,
administrative or investigative, by or in the right of the Company to procure a judgment in its
favor by reason of the fact that he is or was or had agreed to become a director, officer, employee
or agent of the Company, or is or was serving at the request of the Company as a director, officer,
employee, or agent of another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including, without limitation, attorneys’ fees and expenses) actually and
reasonably incurred by him or on his behalf in connection with the defense or settlement of such
action, suit or proceeding and any appeal therefrom or any claim, issue or matter therein if he
acted in good faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the Company, except that no indemnification shall be made in respect of any claim,
issue or matter as to which the Indemnitee shall have been fully adjudged by a court to be liable
to the Company, unless and only to the extent that the Delaware Court of Chancery, or the court in
which such action, suit or proceeding is or was brought, shall determine upon application that,
despite the adjudication of liability, but in view of all the circumstances of the case, the
Indemnitee is fairly and reasonably entitled to indemnity for such expenses and then only to the
extent that the Delaware Court of Chancery or such other court shall determine.

          (c) Determination of Entitlement. Any indemnification under Section l(a) or l(b)
hereof (unless ordered by a court) shall be made by the Company only if authorized in the specific
case upon a determination, in accordance with Section 4 hereof or any applicable provision of the
Company’s Restated Certificate of Incorporation, as then amended (the “Charter”), its By-laws as
then amended (the “By-laws”), any other agreement, any resolution or otherwise, that
indemnification of the Indemnitee is proper in the circumstances because he has met the applicable
standard of conduct set forth in Section l(a) or (b) above. Such determination shall be made (i) by
the Company’s Board of Directors (the “Board”) by a majority vote of directors who are not parties
to such action, suit or proceeding, even though less than a quorum of the Board, (ii) by a
committee of such directors designated by majority vote of such directors, even though less than a
quorum, (iii) if there are no such directors, or if such directors so direct, by independent legal
counsel in a written opinion or (iv) by the stockholders of the Company (the “Stockholders”).
Notwithstanding the foregoing, as contemplated by Section 3, no subsequent amendment or change to
the By-laws or Charter which limits or restricts the rights of the Company to indemnify Indemnitee
shall adversely affect the rights of Indemnitee hereunder.

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          (d) Mandatory Indemnification. Notwithstanding any other provisions of this Agreement,
to the fullest extent permitted by applicable law and to the extent that Indemnitee is a party to
(or participant in) and is successful, on the merits or otherwise, in any action, suit or
proceeding referred to in Section 1(a) or 1(b) hereof, or in defense of any claim, issue or matter
therein, in whole or in part, the Company shall indemnify Indemnitee against all expenses
(including, without limitation, attorneys’ fees and expenses) actually and reasonably incurred by
him in connection therewith. If Indemnitee is not wholly successful in such action, suit or
proceeding but is successful, on the merits or otherwise, as to one or more but less than all
claims, issues or matters therein, the Company shall indemnify Indemnitee against all expenses
actually and reasonably incurred by him or on his behalf in connection with or related to each
successfully resolved claim, issue or matter to the fullest extent permitted by law.

          (e) Advancement of Expenses. Notwithstanding any provision of this Agreement to the
contrary (other than Section 4), the Company shall advance, to the extent not prohibited by law,
the expenses (including, without limitation, attorneys’ fees and expenses) incurred by the
Indemnitee in defending any civil, criminal, administrative or investigative action, suit or
proceeding, and such advancement shall be made within thirty (30) days after the receipt by Company
of a statement or statements requesting such advances from time to time, whether prior to or in
advance of the final disposition of such action, suit or proceeding as authorized in accordance
with Section 4 hereof or any applicable provision of the Charter, the By-laws, any other agreement,
any resolution or otherwise.

          (f) Benefit Plan Matters. For purposes of this Agreement, references to “other
enterprises” shall include employee benefit plans; references to “fines” shall include any excise
taxes assessed on the Indemnitee with respect to any employee benefit plan; references to “serving
at the request of the Company” shall include any service as a director, officer, employee or agent
of the Company which imposes duties on, or involves services by, the Indemnitee with respect to an
employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and
in a manner he reasonably believed to be in the interest of the participants and the beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best
interests of the Company” as referred to in this Section 1.

     2. Additional Indemnification.

          (a) General. If and to the extent that (i) the DGCL is amended hereafter to require
or permit indemnification, expense advancement or exculpation that is or may be more favorable to
the Indemnitee than the maximum permissible indemnification, expense advancement and exculpation
now permitted thereunder and provided in this Agreement, or (ii) the Company reincorporates in or
merges, consolidates or combines into or with any other corporation or entity by virtue of which
transaction the Company is not the surviving, resulting or acquiring corporation and the surviving,
resulting or acquiring corporation is incorporated in a different jurisdiction which at such time
requires or permits indemnification, expense advancement or exculpation that is or may be more
favorable to the Indemnitee than the maximum permissible indemnification, expense advancement and
exculpation now permitted under the DGCL and provided in this Agreement, then pursuant to this
Agreement the Indemnitee shall be entitled to, and this Agreement shall be deemed to be amended to
provide for

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the Indemnitee’s contractual entitlement to, indemnification, expense advancement and
exculpation to the maximum extent that may be permitted or required under such applicable law at
the time of any initial or subsequent request for indemnity hereunder (determined as contemplated
by Section 4 hereof), whether or not the Company has adopted any Charter or By-law provisions
adopting, effecting or implementing any provisions thereof which are permissive and not mandatory
in nature. Nothing contained herein shall be deemed to detract from, diminish, impair, limit or
adversely affect any right which the Indemnitee may have under this Agreement under any
circumstances, including without limitation in the event of subsequent amendment or revision to the
Charter or By-laws, and to the extent that any terms, conditions or provisions of this Agreement
(including, without limitation, those in Section 1 hereof) are more favorable to the Indemnitee
than the maximum indemnification, expense advancement and exculpation then permitted or required
under such applicable law (determined as aforesaid), then such terms, conditions and provisions of
this Agreement shall be preserved and integrated with such more favorable terms from then
applicable law and shall continue to apply to the Indemnitee’s rights by virtue of this Agreement.
The same expansion of the Indemnitee’s rights and deemed inclusion herein and integration herewith
of any terms, conditions or provisions more favorable to the Indemnitee shall occur upon and with
respect to any amendment of the provisions relating to indemnification, expense advancement and
exculpation in the Company’s Charter or By-laws and any provision by the Company to any other
officer or director of the Company of any other different form of indemnification contract or
agreement.

          (b) Examples and Limitations. Without limiting the generality of Section 2(a) hereof,
the Indemnitee hereby may become entitled to indemnification of any and all amounts which he
becomes legally obligated to pay (including, without limitation, damages, judgments, fines,
settlements, expenses of investigation and defense of legal actions, proceedings or claims and
appeals therefrom, and expenses of appeal, attachment or similar bonds) relating to or arising out
of any claim made against him because of any act, failure to act or neglect or breach of duty,
including any actual or alleged error, misstatement or misleading statement, which he commits,
suffers, permits or acquiesces in while acting in his capacity as an officer, director, employee or
agent of the Company, subject only to any limitations on the maximum permissible, expense
advancement or indemnification which may exist under applicable law (determined as provided in
Section 2(a) hereof). In no event, however, shall the Company be obligated under this Section 2 to
make any payment in connection with any claim against the Indemnitee:

          (i) for which payment actually has been made to the Indemnitee under a valid and
collectible insurance policy, except in respect of any retention or excess beyond the amount
of payment under such insurance;

          (ii) which results in a final, nonappealable order for the Indemnitee to pay a fine or
similar governmental imposition which the Company is prohibited by applicable law from
paying; or

          (iii) which is based upon or attributable to the Indemnitee gaining in fact a personal
profit to which he was not legally entitled, including, without limitation, any profits made
from the purchase and sale by the Indemnitee of equity securities of the Company which are
recoverable by the Company pursuant to Section 16(b) of the

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Securities Exchange Act of 1934 and any profits arising from transactions in any
publicly traded securities of the Company which were effected by the Indemnitee in violation
of Section 10(b) of the Securities Exchange Act of 1934 or Rule 10b-5 promulgated
thereunder.

     3. Effect of Future Adverse Changes in Charter, By-laws or Applicable Law.

     Nothing herein shall prevent the adoption by the Board or Stockholders of the Company of any
amendment to the Charter or By-laws of the Company, the effect of which would be to detract from,
diminish, impair, limit or adversely affect the Indemnitee’s rights to indemnification, expense
advancement or exculpation that otherwise exist as of the Effective Date pursuant to such Charter
or By-laws as applied to any act or failure to act occurring in whole or in part after the date
hereof. In the event that the Company shall adopt any such amendment to its Charter or By-laws,
however, or in the event that the indemnification, expense advancement or exculpation provisions of
the DGCL (or any other then applicable law) hereafter shall be amended in a manner which may be
deemed to detract from, diminish, impair, limit or adversely affect the Indemnitee’s rights with
respect thereto, such events and changes shall not in any manner or to any extent detract from,
diminish, impair, limit or adversely affect in any manner the contractual indemnification rights
and procedures granted to and benefiting the Indemnitee under this Agreement, unless and then
except only to the extent that any of such rights or any of the terms, conditions and provisions of
this Agreement shall thereby be made illegal or otherwise violative of applicable law, in which
case the provisions of Section 10(c) hereof shall apply. For purposes only of determining the
Indemnitee’s rights to indemnification pursuant to the Company’s Charter or By-laws as so amended,
and not for purposes of the continuing applicability of this Agreement in accordance with its
terms, any such amendment to the Company’s Charter or By-laws shall apply to acts or failures to
act occurring entirely after the date on which such amendment was approved and adopted by the Board
or the Stockholders, as the case may be, unless the Indemnitee shall have voted in favor of such
approval and adoption as a director or holder of record of the Company’s voting stock, as the case
may be.

     4. Certain Procedures.

          (a) Indemnification Procedures. For purposes of pursuing his rights to
indemnification under Section 1 (other than the second sentence of Section 1(d) hereof, which shall
be governed by Section 4(b) hereof) or Section 2 hereof, as the case may be, the Indemnitee shall
be required to submit to the Board a sworn statement of request for indemnification substantially
in the form of Exhibit 1 hereto (the “Indemnification Statement”) averring that he is entitled to
indemnification hereunder. Submission of an Indemnification Statement to the Board shall create a
presumption that the Indemnitee is entitled to indemnification under Section 1 (other than the
second sentence of Section 1(d) hereof, which shall be governed by Section 4(b) hereof) or Section
2 hereof, as the case may be, and, except as set forth below, the Board shall within 30 calendar
days after submission of the Indemnification Statement specifically determine that the Indemnitee
is so entitled, unless within such 30-calendar day period it shall determine by Board action, based
upon clear and convincing evidence (sufficient to rebut the foregoing presumption) that the
Indemnitee is not entitled to indemnification under Sections 1 or 2 hereof. The Company shall
notify the Indemnitee promptly in writing following such determination.

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Any evidence rebutting the Indemnitee’s presumption, to which the Board gave weight in
arriving at its determination, shall be disclosed to the Indemnitee with particularity in such
written notice. Notwithstanding anything to the contrary contained in the three preceding
sentences, if the Board determines that it cannot act on the request for indemnification submitted
by the Indemnitee because a determination of entitlement can not be made in the manner required by
Section 1(c) hereof, the Board will act promptly to retain independent legal counsel or convene a
meeting of Stockholders to act on the request.

          (b) Expense Advancement Procedures. For purposes of determining whether to authorize
advancement of expenses pursuant to the second sentence of Section 1(d) hereof or Section 2(b)
hereof, the Indemnitee shall be required to submit to the Board a sworn statement of request for
advancement of expenses substantially in the form of Exhibit 2 hereto (the “Undertaking”), averring
that (i) he has incurred or will incur actual expenses in defending a civil, criminal,
administrative or investigative action, suit or proceeding and (ii) he undertakes to repay such
amount if it shall be determined ultimately that he is not entitled to be indemnified by the
Company under this Agreement or otherwise. Within 30 calendar days after receipt of the
Undertaking, the Board shall authorize payment of the expenses described in the Undertaking,
whereupon such payments shall be made promptly by the Company. No security shall be required in
connection with any Undertaking, and any Undertaking shall be accepted without reference to the
Indemnitee’s ability to make repayment.

          (c) Selection of Counsel. In the event the Company shall be obligated under this
Section 4 to pay the expenses of any action, suit or proceeding against the Indemnitee, the Company
shall be entitled to assume the defense of such proceeding, with counsel acceptable to and approved
by the Indemnitee, upon the delivery to the Indemnitee of written notice of the Company’s election
to do so. After delivery of such notice, approval of such counsel by the Indemnitee and the
retention of such counsel by the Company, the Company will not be liable to the Indemnitee under
this Agreement for any fees of separate counsel subsequently incurred by the Indemnitee with
respect to the same action, suit or proceeding; provided, however, that if (i) the
employment of counsel by the Indemnitee has been previously authorized by the Company, (ii) the
Indemnitee shall have reasonably concluded that there may be a conflict of interest between the
Company and the Indemnitee in the conduct of any such defense, or (iii) the Company shall not, in
fact, have employed counsel to assume the defense of such proceeding, then the Indemnitee may
select and employ his own counsel to direct the defense thereof and the fees and expenses of such
counsel shall be paid by the Company. Notwithstanding any assumption of the defense of any such
action, suit or proceeding and employment of counsel with respect thereto by the Company in
accordance with the foregoing, the Indemnitee shall have the right to employ his own separate
counsel to participate in any such action, suit or proceeding at the Indemnitee’s expense.

     5. Corporate Approval. The Company represents and warrants to the Indemnitee that:
(i) the Company has all requisite power and authority to enter into this Agreement and to perform
its obligations hereunder; (ii) this Agreement and the performance of all of the Company’s
obligations hereunder have been approved by all corporate action required on the part of the
Company under the Charter, the By-laws or applicable law or contract; and (iii) this Agreement,
when executed, will constitute the valid and legally binding obligation of the

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Company, enforceable against the Company in accordance with its terms, subject to any
applicable bankruptcy law and equitable limitations.

     6. Fees and Expenses of Enforcement. It is the intent of the Company that, to the
fullest extent permitted by law, the Indemnitee not be required to incur legal fees or other
expenses associated with the enforcement of his rights under this Agreement by litigation or other
legal action because the cost and expense thereof would substantially detract from the benefits
intended to be extended to the Indemnitee hereunder. Accordingly, if it should appear to the
Indemnitee that the Company has failed to comply with any of its obligations under this Agreement
or in the event that the Company or any other person takes any action to declare this Agreement
void or unenforceable, or institutes any action, suit or proceeding designed (or having the effect
of being designed) to deny, or to recover from, the Indemnitee the benefits intended to be provided
to the Indemnitee hereunder, the Company irrevocably authorizes the Indemnitee from time to time to
retain counsel of his choice, at the expense of the Company as hereafter provided, to represent the
Indemnitee in connection with the initiation or defense of any litigation or other legal action,
whether by or against the Company or any director, officer, stockholder or other person affiliated
with the Company, in any jurisdiction. The Company shall, to the fullest extent permitted by law,
indemnify Indemnitee against any and all expenses, including without limitation attorneys’ fees and
expenses, and, if requested by Indemnitee, shall advance, to the extent not prohibited by law, such
expenses, actually and reasonably incurred by the Indemnitee (i) as a result of the Company’s
failure to perform this Agreement or any provision hereof or (ii) as a result of the Company or any
person contesting the validity or enforceability of this Agreement or any provision hereof.

     7. Maintenance of Insurance and Self Insurance.

          (a) The Company represents that it presently has in force and effect policies of D & O
Insurance in insurance companies and amounts as follows (the “Insurance Policies”).

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Insurer	 	Policy No.	 	Amount	 	Deductible
	Chubb Group of Insurance Companies
	 	81691712	 	 	$	10,000,000	 	 	$	250,000	 

Subject only to the provisions of Section 7(b) hereof, the Company hereby agrees that, so long as
Indemnitee shall continue to serve as a director of officer of the Company (or shall continue at
the request of the Company to serve as a director, officer, employee or agent of another company,
partnership, joint venture, trust or other enterprise) and thereafter so long as Indemnitee shall
be subject to any possible claim or threatened, pending or completed action, suit or proceeding,
whether civil, criminal or investigative by reason of the fact that Indemnitee was a director of
the Company (or served in any of said other capacities), the Company will purchase and maintain in
effect for the benefit of Indemnitee one or more valid, binding and enforceable policy or policies
of D & O Insurance providing, in all respects, coverage at least comparable to that presently
provided pursuant to the Insurance Policies.

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          (b) The Company shall not be required to maintain said policy or policies of D & O Insurance
in effect if said insurance is not reasonably available or if, in the reasonable business judgment
of the then directors of the Company, either (i) the premium cost for such insurance is
substantially disproportionate to the amount of coverage or (ii) the coverage provided by such
insurance is so limited by exclusions that there is insufficient benefit from such insurance.

     8. Reorganizations. In the event that the Company shall be a constituent corporation
(including any constituent of a constituent) in a merger, reorganization, consolidation,
combination or similar transaction, the Company, if it shall not be the surviving, resulting or
acquiring corporation therein, shall require as a condition thereto the surviving, resulting or
acquiring corporation to expressly assume and adopt this Agreement and to agree to indemnify the
Indemnitee to the full extent provided in this Agreement. Whether or not the Company is the
resulting, surviving or acquiring corporation in any such transaction, the Indemnitee shall stand
in the same position under this Agreement with respect to the resulting, surviving or acquiring
corporation as he would have with respect to the Company if its separate existence had continued.

     9. Nonexclusivity, Survival and Subrogation.

          (a) Nonexclusivity. The rights to indemnification and advancement provided by this
Agreement shall not be exclusive of any other rights to which the Indemnitee may be entitled under
the Charter, the By-laws, the DGCL, any other statute, insurance policy, agreement, vote of
shareholders or of directors or otherwise, both as to actions in his official capacity and as to
actions in another capacity while holding such office.

          (b) Survival. The provisions of this Agreement shall survive the death, disability,
or incapacity of the Indemnitee or the termination of the Indemnitee’s service as an officer,
director, employee or agent of the Company and shall inure to the benefit of, and be enforceable
by, the Indemnitee’s heirs, executors, guardians, administrators or assigns.

          (c) Subrogation. In the event of any payment by the Company under this Agreement, the
Company shall be subrogated to the extent thereof to all rights of recovery previously vested in
the Indemnitee, who shall cooperate with the Company, at the Company’s expense, in executing all
such instruments and taking all such other actions as shall be reasonably necessary for the Company
to enforce such right or as the Company may reasonably request.

     10. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, without giving effect to the principles of conflict of laws
thereof.

     11. Miscellaneous.

          (a) This Agreement shall become effective as of the Effective Date.

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          (b) This Agreement contains the entire agreement of the parties relating to the subject matter
hereof.

          (c) Any provision of this Agreement may be amended or waived only if such amendment or waiver
is in writing and signed, in the case of an amendment, by both parties hereto or, in the case of a
waiver, by the party against whom the waiver is to be effective. No failure or delay by either
party in exercising any right, power or privilege hereunder shall operate as a waiver hereof nor
shall any single or partial exercise thereof preclude any other or future exercise thereof or the
exercise of any other right, power or privilege.

          (d) If any provision of this Agreement or the application of any provision hereof to any
person or circumstance is held invalid, unenforceable or otherwise illegal, the remainder of this
Agreement and the application of such provision to other persons or circumstances shall not be
affected, and the provision so held to be invalid, unenforceable or otherwise illegal shall be
reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.

          (e) Nothing contained in this Agreement is intended to create in the Indemnitee any separate
or independent right to continued employment by the Company.

          (f) This Agreement may be executed in counterparts, but all such counterparts taken together
shall constitute on and the same Agreement.

          (g) The descriptive headings of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement. The use of the word “including” in this Agreement shall be by
way of example rather than limitation. The use of the word “or” in this Agreement is intended to
be conjunctive rather than disjunctive.

* * * * * *

          IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date first
above written.

	 	 	 	 	 
	 	MAGELLAN PETROLEUM CORPORATION

 	 
	 	By:  	/s/ Walter J. McCann
 	 
	 	Name:  	Walter McCann 	 
	 	Title:  	Chairman of the Board 	 
	 
	 	 	 
	 	     /s/ William H. Hastings
 	 
	 	William H. Hastings 	 
	 	 	 

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EXHIBIT 1

Indemnification Statement

	 	 	 
	STATE OF

	 	) 
	 

	 	) ss. 
	COUNTY OF

	 	) 

          I,                                         , being first duly sworn, do depose and state as follows:

          1. This Indemnification Statement is submitted pursuant to the Indemnification Agreement,
dated                                         , 200___ between Magellan Petroleum Corporation, a Delaware corporation
(the “Company”), and the undersigned.

          2. I am requesting indemnification against expenses (including, without limitation, attorneys’
fees and expenses), costs, judgments, damages, fines and amounts paid in settlement, all of which
(collectively, “Liabilities”) have been or will be actually and reasonably incurred by me in
connection with an actual or threatened action, suit or proceeding to which I was or am a party or
am threatened to be made a party.

          3. With respect to all matters related to any such action, suit or proceeding, I am entitled
to be indemnified as herein contemplated pursuant to the aforesaid Indemnification Agreement.

          4. Without limiting any other rights which I have or may have, I am requesting indemnification
against Liabilities which have arisen or

				
	may arise out of  	 	 
	 
	 	 	 
	 	 
	 	 
	 	.

Indemnitee

                                                            

Subscribed and sworn to before me, a Notary Public in and for said County and State, this ___ day
of                     , 20___.

[Seal]

My commission expires the       day of                     , 20 ___.

 

 

EXHIBIT 2

Undertaking

	 	 	 
	STATE OF

	 	) 
	 

	 	) ss. 
	COUNTY OF

	 	) 

          I,                                         , being first duly sworn, do depose and state as follows:

          1. This Undertaking is submitted pursuant to the Indemnification Agreement, dated
                                         , 200___, between Magellan Petroleum Corporation, a Delaware corporation (the
“Company”), and the undersigned.

          2. I am requesting advancement of certain expenses (including, without limitation, attorneys’
fees and expenses) which I have incurred or will incur in defending a civil, criminal,
administrative or investigative action, suit or proceeding.

          3. I hereby undertake to repay this advancement of expenses if it shall ultimately be
determined that I am not entitled to be indemnified by the Company under the aforesaid
Indemnification Agreement or otherwise.

	 	 	 	 	 
	 

	4. The expenses for which advance is requested are, in general, all expenses related to	 	 	 
	 	 	 
	 	 	 
	 	 	.

Indemnitee

                                                            

Subscribed and sworn to before me, a Notary Public in and for said County and State, this       day
of                     , 20___.

[Seal]

My commission expires the       day of                     , 20___.EX-10.3

Exhibit 10.3

MAGELLAN PETROLEUM CORPORATION

NON-QUALIFIED STOCK OPTION AWARD AGREEMENT

     This Agreement, made as of the grant date indicated in Section 3 below (the “Grant
Date”), and between Magellan Petroleum Corporation, a Delaware corporation (the “Company”), and the
undersigned individual (the “Optionee”), pursuant to the Magellan Petroleum Corporation 1998 Stock
Option Plan, as amended on October 24, 2007, as further amended and renamed the “1998 Stock
Incentive Plan” on December 11, 2008 (the “Plan”). Terms used but not defined herein shall have
the same meaning as in the Plan).

     Whereas, the Optionee is the President and Chief Executive Officer and a director of
the Company and the Company; and

     Whereas, the Company, acting through the Compensation Committee and the full Board of
Directors has approved the award of Nonqualified Stock Options (“Options”) under the Plan to the
Optionee (“Award”).

     Now, Therefore, in consideration of the terms and conditions of this Agreement and
pursuant to the Plan, the parties agree as follows:

	1.	 	Grant of Options. The Company hereby grants to the Optionee the right and option to
purchase from the Company, at the exercise price set forth in Section 3 below, all or any part
of the aggregate number of shares of common stock, par value $0.01 per share, of the Company,
as such common shares are presently constituted (the “Stock”), set forth in said Section 3.

	2.	 	Terms and Conditions. It is understood and agreed that the Options evidenced hereby
shall at all times be subject to the provisions of the Plan (which are incorporated herein by
reference) and the following terms and conditions:

	 	(a)	 	Expiration Date. The Options evidenced hereby shall expire on the
date specified in Section 3 below, or earlier as provided in Section 7 of the Plan.
	 
	 	(b)	 	Exercise of Option. The Options evidenced hereby shall be
exercisable from time to time by (i) providing written notice of exercise ten (10)
days prior to the date of exercise specifying the number of shares for which the
Options are being exercised, addressed to the Company at its principal place of
business, and (ii) either:

	 	(A)	 	Cash Only Exercise – submitting the full cash purchase price
of the exercised Stock; or

 

 

	 	(B)	 	Cashless Exercise – submitting appropriate authorization for
the sale of Stock in an amount sufficient to provide the full purchase price
in accordance with Section 5(d) of the Plan, or
	 
	 	(C)	 	Combination – tendering a combination of (i) and (ii) above.

	 	(c)	 	Withholding Taxes. Without regard to the method of exercise and
payment, the Optionee shall pay to the Company, upon notice of the amount due, any
withholding taxes payable with respect to such exercise, which payment may be made
with shares of Stock which would otherwise be issued pursuant to the Options.
	 
	 	(d)	 	Vesting. The shares covered by the Options shall vest as follows:
	 
	 	(i)	 	six hundred and twelve thousand, five hundred (612,500) Option shares shall
vest in full on December 11, 2009;
	 
	 	(ii)	 	six hundred and twelve thousand, five hundred (612,500) Option shares shall
vest in full on December 11, 2010; and
	 
	 	(iii)	 	six hundred and twelve thousand, five hundred (612,500) Option shares shall
vest in full on December 11, 2011.
	 
	 	(e)	 	Acceleration. The Options evidenced hereby shall immediately be
accelerated and vest in full upon:
	 
	 	(i)	 	a “change of control” of the Company as defined in Section 15 of the Plan;
	 
	 	(ii)	 	the Company’s termination of the Optionee’s employment with the Company
without “Cause” (as such term is defined in the Optionee’s Employment Agreement with
the Company); or
	 
	 	(iii)	 	upon the Optionee’s resignation from the Company for “Good Reason” (as such
term is defined in the Optionee’s Employment Agreement with the Company).
	 
	 	(f)	 	Compliance with Laws and Regulations. The Options evidenced hereby
are subject to restrictions imposed at any time on the exercise or delivery of shares
in violation of the By-Laws of the Company or of any law or governmental regulation
that the Company may find to be valid and applicable.
	 
	 	(g)	 	Interpretation. Optionee hereby acknowledges that this Agreement is
governed by the Plan, a copy of which Optionee hereby acknowledges having received,
and by such administrative rules and regulations relative to the Plan and not
inconsistent therewith as may be adopted and amended from time by

-2-

 

	 	 	 	the Committee (the “Rules”). Optionee agrees to be bound by the terms and provisions
of the Plan and the Rules.

	3.	 	Option Data.

	 	 	 
	Optionee’s Name:

	 	William H. Hastings
	 
	 	 
	Number of shares of Stock
	 	 
	Subject to this Option:

	 	1,837,500 (one million, eight hundred thirty-seven
thousand, five hundred)
	 
	 	 
	Grant Date:

	 	December 11, 2008
	 
	 	 
	Exercise Price Per Share:

	 	$1.20 per share
	 
	 	 
	Expiration Date:

	 	December 11, 2018

	4.	 	Award of Options Contingent Upon Shareholder Approval. The award of the Options to
the Optionee hereby are expressly conditioned upon, and shall only take effect, if the
Company’s shareholders approve an amendment and restatement of the Plan at either (i) the
Company’s 2008 annual meeting of shareholders to be held in the near future, or (ii) at any
subsequent annual or special meeting of shareholders of the Company held on or before December
31, 2009, which approval is required under the terms of the Plan and the listing requirements
of the Nasdaq Stock Market, Inc. Optionee acknowledges and agrees that, should the required
shareholder approval of the Plan not be obtained on or prior to December 31, 2009, then the
Award of Options evidenced hereby shall be null and void and of no further force and effect.
	 
	5.	 	Miscellaneous. This Agreement and the Plan (a) contains the entire Agreement of the
parties relating to the subject matter of this Agreement and supersedes any prior agreements
or understandings with respect thereto; and (b) shall be binding upon and inure to the benefit
of the Company, its successors and assigns and the Optionee, his heirs, devisees and legal
representatives. In the event of the Optionee’s death or a judicial determination of his
incompetence, reference in this Agreement to the Optionee shall be deemed to refer to his
legal representative, heirs or devisees, as the case may be.

-3-

 

* * * * * *

     In Witness Whereof, the Company has caused this instrument to be executed by its
authorized officer, as of the date identified below.

	 	 	 	 	 	 	 	 	 
	Agreed to:	 	 	 	MAGELLAN PETROLEUM CORPORATION	 	 
	 
	 	 	 	 	 	 	 	 
	/s/ William H. Hastings
 

	 	 	 	By:
	 	/s/ Walter McCann
 

	 	 
	Optionee: William H. Hastings

	 	 	 	 	 	Name: Walter McCann	 	 
	 

	 	 	 	 	 	Title: Chairman of the Board	 	 

Date: February 3, 2009

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