Document:

EX-4.1

Exhibit 4.1

 

 

Seventh Supplemental Indenture

between

MetLife, Inc.,

as Issuer,

and

The Bank of New York Mellon Trust Company, N.A.,

as Trustee

Dated as of February 6, 2009

 

 

 

 

Table of Contents

	 	 	 	 	 	 	 
	 	 	 	 	Page
	 
	 	 	 	 	 	 
	ARTICLE I

	 
	 	 	 	 	 	 
	Definitions

	 
	 	 	 	 	 	 
	SECTION 1.1

	 	Definitions of Terms.
	 	 	2	 
	 
	 	 	 	 	 	 
	ARTICLE II

	 
	 	 	 	 	 	 
	Amendments to the Indenture

	 
	 	 	 	 	 	 
	SECTION 2.1

	 	Amendment to Section 2.7 of the Second Supplemental Indenture.
	 	 	5	 
	SECTION 2.2

	 	Amendment to Section 2.12 of the Second Supplemental Indenture.
	 	 	5	 
	SECTION 2.3

	 	Amendment to Section 2.12(f) of the Second Supplemental Indenture.
	 	 	5	 
	SECTION 2.4

	 	Adding Section 2.13 to the Second Supplemental Indenture.
	 	 	5	 
	 
	 	 	 	 	 	 
	ARTICLE III

	 
	 	 	 	 	 	 
	Remarketing and Reset Mechanics

	 
	 	 	 	 	 	 
	SECTION 3.1

	 	Remarketing and Reset Mechanics.
	 	 	6	 
	SECTION 3.2

	 	Waiver of Reset Cap.
	 	 	7	 
	 
	 	 	 	 	 	 
	ARTICLE IV

	 
	 	 	 	 	 	 
	Tranches

	 
	 	 	 	 	 	 
	SECTION 4.1

	 	Final Terms.
	 	 	7	 
	SECTION 4.2

	 	References to Series.
	 	 	7	 
	 
	 	 	 	 	 	 
	ARTICLE V

	 
	 	 	 	 	 	 
	Redemption

	 
	 	 	 	 	 	 
	SECTION 5.1

	 	Redemption.
	 	 	7	 
	 
	 	 	 	 	 	 
	ARTICLE VI

	 
	 	 	 	 	 	 
	Events of Default

	 
	 	 	 	 	 	 
	SECTION 6.1

	 	Events of Default.
	 	 	7	 
	ARTICLE VII

i

 

	 	 	 	 	 	 	 
	 	 	 	 	Page
	Miscellaneous

	 
	 	 	 	 	 	 
	SECTION 7.1

	 	Effectiveness.
	 	 	8	 
	SECTION 7.2

	 	Trustee Not Responsible for Recitals.
	 	 	8	 
	SECTION 7.3

	 	Governing Law.
	 	 	8	 
	SECTION 7.4

	 	Counterparts.
	 	 	8	 

ii

 

     SEVENTH SUPPLEMENTAL INDENTURE, dated as of February 6, 2009 (this “Seventh Supplemental
Indenture”), between MetLife, Inc., a Delaware corporation (the “Company”), and The Bank of New
York Mellon Trust Company, N.A., as trustee (the “Trustee”), supplementing the Second Supplemental
Indenture, dated as of June 21, 2005 (the “Second Supplemental Indenture”), between the Company and
The Bank of New York Mellon Trust Company, N.A. (as successor in interest to J.P. Morgan Trust
Company, National Association), as trustee, and further supplementing the Subordinated Indenture,
dated as of June 21, 2005 (the “Base Indenture” and together with the Second Supplemental
Indenture, the “Indenture”), between the Company and The Bank of New York Mellon Trust Company,
N.A. (as successor in interest to J.P. Morgan Trust Company, National Association), as trustee.

Recitals

     WHEREAS, the Company executed and delivered the Base Indenture to the Trustee to provide for
the future issuance of the Company’s unsecured subordinated debentures, notes or other evidence of
indebtedness, to be issued from time to time in one or more series as might be determined by the
Company under the Base Indenture;

     WHEREAS, the Company executed and delivered the Second Supplemental Indenture to the Trustee
to provide for the issuance of the Company’s 4.91% Junior Subordinated Debt Securities, Series B,
due 2040 (the “Series B Debentures”);

     WHEREAS, pursuant to Section 2.12 of the Second Supplemental Indenture, the Company and the
Trustee are required to enter into this Seventh Supplemental Indenture to make provision for
remarketing and reset mechanics, including notices in respect thereof, on the basis set forth in
Article X of the Trust Agreement (as defined below) with respect to the Series B Debentures;

     WHEREAS, the Company desires to include in this Seventh Supplemental Indenture provisions
intended to: (i) cure certain ambiguities, defects, or inconsistencies in the Second Supplemental
Indenture; (ii) amend the Second Supplemental Indenture to allow for a Remarketing of the Series B
Debentures in two or more tranches (for which amendments the Company has obtained all necessary
consents); and (iii) address certain matters incidental to the purpose of this Seventh Supplemental
Indenture as described in this and the preceding recital;

     WHEREAS, the Company has requested that the Trustee, in respect to the Series B Debentures,
execute and deliver this Seventh Supplemental Indenture in such capacity; and

     WHEREAS, all requirements necessary to make this Seventh Supplemental Indenture a valid
instrument in accordance with its terms, including its execution and delivery, have been duly
authorized in all respects.

     NOW, THEREFORE, the Company and the Trustee agree as follows:

 

 

ARTICLE I 

Definitions

     SECTION 1.1 Definitions of Terms.

     Unless the context otherwise requires or unless otherwise set forth herein:

     (a) a term not defined herein that is defined in the Indenture, has the same meaning when used
in this Seventh Supplemental Indenture;

     (b) the definition of any term in this Seventh Supplemental Indenture that is also defined in
the Indenture, shall for the purposes of this Seventh Supplemental Indenture supersede the
definition of such term in the Indenture;

     (c) a term defined anywhere in this Seventh Supplemental Indenture has the same meaning
throughout;

     (d) the definition of a term in this Seventh Supplemental Indenture is not intended to have
any effect on the meaning or definition of an identical term that is defined in the Indenture
insofar as the use or effect of such term in the Base Indenture, as previously defined, is
concerned;

     (e) the singular includes the plural and vice versa;

     (f) headings are for convenience of reference only and do not affect interpretation; and

     (g) the following terms have the meanings given to them in this Section 1.1(g):

     “Base Indenture” has the meaning set forth in the preamble hereto.

     “Company” has the meaning set forth in the preamble hereto.

     “Comparable Treasury Issue” means the U.S. Treasury security selected by the Premium
Calculation Agent as having a maturity comparable to the term remaining from the Redemption Date to
a date to be specified in the security certificate representing the Series B Debentures (or any
tranche thereof) following a Successful Remarketing (the “Remaining Life”) that would be utilized,
at the time of selection and in accordance with customary financial practice, in pricing new issues
of corporate debt securities of comparable term.

     “Comparable Treasury Price” means, with respect to a Redemption Date (1) the average of five
Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and
lowest Reference Treasury Dealer Quotations, or (2) if the Premium Calculation Agent obtains fewer
than five such Reference Treasury Dealer Quotations, the average of all such quotations.

2

 

     “First Applicable Remarketing Settlement Date” has the meaning set forth in the Stock Purchase
Contract Agreement.

     “Indenture” has the meaning set forth in the preamble hereto.

     “Make-Whole Redemption Amount” means the sum, as calculated by the Premium Calculation Agent,
of the present values of the remaining scheduled payments of principal and interest thereon for the
principal amount to be redeemed (not including any portion of those payments of interest accrued as
of the date of redemption), discounted from their respective scheduled payment dates to the date of
redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate plus the Spread plus, in each case, accrued and unpaid interest thereon to the
date of redemption.

     “Premium Calculation Agent” means an investment banking institution of national standing
appointed by the Company.

     “Reference Treasury Dealer” means (1) Citigroup Global Markets, Inc. and its successors,
provided, however, that if any of the foregoing shall cease to be a primary U.S. government
securities dealer in New York City (a “Primary Treasury Dealer”), the Company will substitute
therefor another Primary Treasury Dealer, and (2) any other Primary Treasury Dealers selected by
the Premium Calculation Agent after consultation with the Company.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by the Premium Calculation Agent of the bid and
ask prices for the Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Premium Calculation Agent at 5:00 p.m., New York City
time, on the third Business Day preceding such Redemption Date.

     “Remarketing” means a remarketing of the Series B Debentures in accordance with Section 2.12
of the Second Supplemental Indenture, as supplemented by this Seventh Supplemental Indenture.

     “Remarketing Agent” means, as to a Remarketing, the remarketing agent(s) and any successor or
replacement remarketing agent appointed pursuant to Section 10.1 of the Trust Agreement or Section
3.01 of this Seventh Supplemental Indenture, as applicable.

     “Remarketing Agreement” means a remarketing agreement entered into among the Company, a
nationally recognized investment banking firm, as Remarketing Agent, and The Bank of New York
Mellon Trust Company, N.A., not individually, but solely as Purchase Contract Agent (as defined in
the Remarketing Agreement) and as attorney-in-fact of the holders of Purchase Contracts (as defined
in the Remarketing Agreement), at least 30 days prior to a Remarketing Date (as defined in the
Trust Agreement).

     “Reset Cap” has the meaning set forth in the Trust Agreement.

3

 

     “Second Applicable Remarketing Settlement Date” has the meaning set forth in the Stock
Purchase Contract Agreement.

     “Second Supplemental Indenture” has the meaning set forth in the preamble hereto.

     “Separate Series B Debentures” means Series B Debentures, if any, that resulted from the
creation of Stripped Common Equity Units (as defined in the Stock Purchase Contract Agreement) in
accordance with Section 3.13 of the Stock Purchase Contract Agreement.

     “Series B Debentures” has the meaning set forth in the recitals of this Seventh Supplemental
Indenture.

     “Seventh Supplemental Indenture” has the meaning set forth in preamble hereto.

     “Spread” means a number of basis points determined by the Company and the Remarketing Agents
upon a successful Remarketing (as defined in the Remarketing Agreement).

     “Stock Purchase Contract Agreement” means the Stock Purchase Contract Agreement, dated as of
June 21, 2005, between the Company and The Bank of New York Mellon Trust Company, N.A. (as
successor in interest to J.P. Morgan Trust Company, National Association), as stock purchase
contract agent.

     “Stock Purchase Date” has the meaning set forth in the Stock Purchase Contract Agreement.

     “Successful” means, as to the Remarketing, that the Remarketing Agent finds buyers for all of
the Series B Debentures offered in the Remarketing by 4:00 P.M., New York City time, on the
Remarketing Date.

     “Third Applicable Remarketing Settlement Date” has the meaning set forth in the Stock Purchase
Contract Agreement.

     “Treasury Rate” means, with respect to any Redemption Date, the rate per annum equal to the
semiannual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price
for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such Redemption Date. The Treasury Rate will be calculated on the
third Business Day preceding the Redemption Date.

     “Trust Agreement” means the Amended and Restated Declaration of Trust of the Trust, dated as
of June 21, 2005, among the Company, as sponsor, The Bank of New York Mellon Trust Company, N.A.
(as successor in interest to J.P. Morgan Trust Company, National Association), as property trustee,
BNY Mellon Trust of Delaware (as successor in interest to Chase Bank USA, National Association), as
Delaware Trustee,

4

 

and the administrative trustees named therein and the holders from time to time of the
beneficial interests in the assets of the Trust.

     “Trustee” has the meaning set forth in the preamble hereto.

ARTICLE II

Amendments to the Indenture

     SECTION 2.1 Amendment to Section 2.7 of the Second Supplemental Indenture.

     Section 2.7 of the Second Supplemental Indenture is hereby amended by deleting all references
to “February 15, 2009” and replacing each of them with “the Third Applicable Remarketing Settlement
Date.”

     SECTION 2.2 Amendment to Section 2.12 of the Second Supplemental Indenture.

     Section 2.12 of the Second Supplemental Indenture is hereby amended by inserting immediately
after the first sentence of the first paragraph the following:

     “Upon a Successful Remarketing, the Series B Debentures shall be substantially identical
except that the Series B Debentures may, at the Company’s sole option, be comprised of two or more
tranches with each such tranche having different (i) Stated Maturities, as determined in accordance
with Section 2.12(b) of this Second Supplemental Indenture, (ii) rates of interest, as determined
in accordance with the last paragraph of Section 2.12 of this Second Supplemental Indenture and
Section 10.3 of the Trust Agreement, and (iii) denominations and interest payment dates, as
determined in accordance with the Indenture, as the same may be further supplemented from time to
time by a supplemental indenture.”

     SECTION 2.3 Amendment to Section 2.12(f) of the Second Supplemental Indenture.

     The last proviso of Section 2.12(f) of the Second Supplemental Indenture is hereby amended by
deleting “February 15, 2009” and replacing it with “the Stock Purchase Date.”

     SECTION 2.4 Adding Section 2.13 to the Second Supplemental Indenture.

     The following Section 2.13 is hereby added immediately after the revised Section 2.12 of the
Second Supplemental Indenture:

     “SECTION 2.13 Exchange of Certificates Representing Separate Series B Debentures.

     From and after a Successful Remarketing, certificates representing Separate Series B
Debentures shall be surrendered and exchanged for certificates representing a like aggregate
principal amount of Series B Debentures as modified as a result of the

5

 

Successful Remarketing. If the Series B Debentures consist of two or more tranches, the
tranches will be allocated on a pro rata basis, calculated using the proportion of the aggregate
principal amount of each tranche of Series B Debentures as compared to the total aggregate
principal amount of the Series B Debentures. If, following a Successful Remarketing, the Series B
Debentures are held by The Depository Trust Company or another securities depositary, certificates
representing Separate Series B Debentures shall be surrendered and exchanged for a beneficial
interest in the global security certificate representing such Series B Debentures. The Trustee, in
consultation with the Company, shall establish such procedures as the Trustee and the Company shall
deem appropriate to effect such exchange of certificates representing Separate Series B Debentures
in accordance with the terms of the Indenture and the Seventh Supplemental Indenture. Any
certificates representing Separate Series B Debentures not surrendered for exchange following a
Successful Remarketing will be deemed to represent a like aggregate principal amount of Series B
Debentures as modified as a result of the Successful Remarketing until such certificates are so
surrendered and exchanged.”

ARTICLE III

Remarketing and Reset Mechanics

     SECTION 3.1 Remarketing and Reset Mechanics.

     The provisions of Article X of the Trust Agreement shall apply, mutatis mutandis, to the
Remarketing of the Series B Debentures, except that:

     (a) “February 15, 2009” in the last sentence of the first paragraph of Section 10.2 shall be
replaced with “the Third Applicable Remarketing Settlement Date;”

     (b) “February 15, 2009” in the first sentence of Section 10.2(f) shall be replaced by “the
Third Applicable Remarketing Settlement Date;”

     (c) “February 15, 2009” in the last proviso of Section 10.2 shall be replaced with “the Third
Applicable Remarketing Settlement Date;”

     (d) “November 15, 2008” in Section 10.3(a)(i) shall be replaced with “the Second Applicable
Remarketing Settlement Date;”

     (e) “February 15, 2009” in Section 10.3(d) shall be replaced with “the Third Applicable
Remarketing Settlement Date;”

     (f) “February 15, 2009” in Section 10.3(e) shall be replaced with “the Third Applicable
Remarketing Settlement Date;”

     (g) “February 15, 2009” in Section 10.4(a)(iv) shall be replaced with “the Third Applicable
Remarketing Settlement Date;”

     (h) “February 15, 2009 Remarketing Settlement Date” in Section 10.4(a)(vii) shall be replaced
with “Third Applicable Remarketing Settlement Date;”

6

 

     (i) “February 15, 2009” in Section 10.4(f) shall be replaced with “ the Third Applicable
Remarketing Settlement Date;”

     (j) all references to “February 15, 2010” in Section 10.5(a)(ii) shall be replaced with “the
Third Applicable Remarketing Settlement Date;” and

     (k) all references to “February 15, 2010 Remarketing Settlement Date” in Section 10.5(b) shall
be replaced with “Third Applicable Remarketing Settlement Date.”

     SECTION 3.2 Waiver of Reset Cap.

     The Reset Cap referred to in Section 10.3(a)(i) of the Trust Agreement shall not apply in
connection with the First Applicable Remarketing Settlement Date.

ARTICLE IV

Tranches

     SECTION 4.1 Final Terms.

     Upon a Successful Remarketing, the final terms of the Series B Debentures or any tranche of
Series B Debentures will be reflected in the security certificate or certificates evidencing the
Series B Debentures or any tranche of Series B Debentures.

     SECTION 4.2 References to Series.

     Upon a Successful Remarketing, any reference in the Indenture to “series” and “Series B
Debentures” shall, unless otherwise required by the context, be deemed to be a reference to each
separate tranche of Series B Debentures.

ARTICLE V

Redemption

     SECTION 5.1 Redemption.

     Upon a Successful Remarketing, the Series B Debentures will be redeemable at the Company’s
option, in whole or in part, at any time, on or after February 15, 2011, at a redemption price
equal to the greater of 100% of the principal amount to be redeemed plus accrued and unpaid
interest to the date of redemption and the Make-Whole Redemption Amount.

ARTICLE VI

Events of Default

     SECTION 6.1 Events of Default.

     Upon a Successful Remarketing, Section 6.1(a)(i) of the Second Supplemental Indenture shall be
deleted in its entirety and replaced with the following:

7

 

     “the Company defaults in the payment of any installment of interest (including Additional
Interest) upon the Series B Debentures, as and when the same shall become due and payable, and
continuance of such default for a period of thirty (30) days or more;”.

ARTICLE VII

Miscellaneous

     SECTION 7.1 Effectiveness.

     This Seventh Supplemental Indenture will become effective upon its execution and delivery.

     SECTION 7.2 Trustee Not Responsible for Recitals.

     The recitals herein contained are made by the Company and not by the Trustee, and the Trustee
assumes no responsibility for the correctness thereof. The Trustee makes no representation as to
the validity or sufficiency of this Seventh Supplemental Indenture.

     SECTION 7.3 Governing Law.

     This Seventh Supplemental Indenture will be governed by, and construed in accordance with, the
internal laws of the State of New York.

     SECTION 7.4 Counterparts.

     This Seventh Supplemental Indenture may be executed in any number of counterparts each of
which shall be an original; but such counterparts shall together constitute but one and the same
instrument.

8

 

     IN WITNESS WHEREOF, the parties hereto have caused this Seventh Supplemental Indenture to be
duly executed by their respective officers thereunto duly authorized, on the date or dates
indicated in the acknowledgments and as of the day and year first above written.

	 	 	 	 	 
	 	MetLife, Inc.,

as Issuer

 	 
	 	By:  	/s/  Eric
T. Steigerwalt	 
	 	 	Name:  	Eric T. Steigerwalt 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 
	 
	 	The Bank of New York Mellon Trust Company, N.A.,

as Trustee

 	 
	 	By:  	/s/  R.
Tarnas	 
	 	 	Name:  	R. Tarnas	 
	 	 	Title:  	Vice President	 
	 

Seventh
Supplemental IndentureEX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT 

     THIS AGREEMENT is made and entered into 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 “Executive”).

W I T N E S S E T H

     WHEREAS, the Executive commenced employment with the Company on December 11, 2008 (the
“Effective Date”) and is current serving as its President and Chief Executive Officer; and

     WHEREAS, the Company and the Executive (the “Parties”) desire to enter into this agreement
(the “Agreement”) setting forth the terms and conditions of the Executive’s employment; and

     WHEREAS, the Parties are also entering into two non-qualified stock option award agreements
(the “Option Agreements”) and an indemnification agreement (the “Indemnification Agreement”);

     NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein and for
other good and valuable consideration, the Parties, intending to be legally bound, agree as
follows:

1. Term of Employment.

     1.1 The Company hereby agrees to employ the Executive, and the Executive hereby accepts
employment with the Company in accordance with the terms and provisions of this Agreement.

     1.2 The term of employment this Agreement (“Term”) shall be the period commencing as of the
Effective Date and ending on the earlier of: (a) December 11, 2013 (the 5th anniversary
of the Effective Date); or (b) the date of termination of the Executive’s employment pursuant to
Sections 5, 6 or 7 below, whichever is applicable. If not terminated earlier than December 11,
2013 in accordance with Sections 5, 6 or 7 below, the Company shall provide the Executive written
notice not less than six (6) months prior to December 11, 2013 of the Company’s intention to either
(i) permit this Agreement to terminate on such date or (ii) renew the Executive’s employment with
the Company in the offices described below in Section 2.1. If the Company notifies the Executive
of its intention to renew this Agreement, the Company and the Executive shall in good faith
negotiate the duration and other terms of the Executive’s continued employment with the Company.
Upon termination of this Agreement for any reason, the obligations of Company under this Agreement
shall cease and Employee shall forfeit all right to receive any compensation or other benefits
under this Agreement, except the amounts described in Sections 6, 7, 8 or 9 of this Agreement.

 

 

2. Duties.

     2.1 Offices. As of the Effective Date, the Executive has assumed the positions of
President and Chief Executive Officer of the Company. It is the intention of the Parties that
during the Term hereof, the Executive will continue to serve as President and Chief Executive
Officer of the Company and will devote substantially all of his business time and attention and
best efforts to the affairs of the Company and its subsidiaries and his duties; provided,
however, that Executive may continue to participate, on a part time basis, as (i) a director of
a floating liquefied natural gas company and (ii) as a consultant to a methanol company (“Permitted
Activities”) so long as such Permitted Activities do not constitute an actual or potential conflict
of interest with the Company’s business in the judgment of the Board. The Executive will have such
duties as are appropriate to his position, and will have such authority as required to enable the
Executive to perform these duties. Consistent with the foregoing, the Executive shall comply with
all reasonable instructions of the Board of Directors of the Company (the “Board”) or a committee
thereof. Nothing in this Agreement shall prevent the Executive from (i) participating in
charitable, civic, educational, professional, community or industry affairs or, with prior written
approval of the Board, serving on the board of directors or advisory boards of other companies; and
(ii) managing the Executive’s and the Executive’s family’s personal investments so long as such
activities do not materially interfere with the performance of the Executive’s duties hereunder or
create a potential business conflict or the appearance thereof.

     2.2 Office Location. The Company expects to relocate its principal executive offices
to Portland, Maine during the first quarter of 2009. Until the relocation has been effectuated,
the Executive shall be permitted to work from his home in the Portland, Maine area.

     2.3 Board Service. The Executive was elected to the Company’s Board as a Class II
director of the Company, as of the Effective Date. The Board has also determined to nominate
Executive for a three-year term of office as a Company director, commencing at the 2008 annual
meeting of shareholders and expiring at the 2011 annual meeting of shareholders. During the Term
of this Agreement, the Board shall nominate the Executive from time to time, as a director of the
Company for reelection as a Class II director, each time the members of such Class stand for
election thereafter. In addition, the Company, as the sole stockholder of Magellan Petroleum
Australia Limited (“MPAL”), will recommend to the MPAL Board of Directors that the Executive be
elected to the MPAL Board of Directors promptly.

3. Compensation and Benefits.

     3.1 Salary. During the Term of this Agreement, the Company shall pay the Executive a
base salary at an initial annual rate of Three Hundred Thousand Dollars ($300,000). Beginning July
1, 2009 and effective each July 1st thereafter during the Term of this Agreement, the
Executive’s salary shall be increased by a percentage amount that shall not be less than the
greater of (i) 4% per year or (ii) the percentage increase in the Bureau of Labor Statistics’
announced Consumer Price Index for All Urban Consumers, All Items (the “CPI-U”), unadjusted, for
the 12-month period ending on the June 30th immediately preceding the July
1st on which such salary increase is scheduled to take effect. The first increase to
the Executive’s base salary as of July 1, 2009 shall consist of a pro rata seven (7) month portion
of the increase

-2-

 

described in the immediately preceding sentence. By way of example only, if the CPI-U,
unadjusted, increased during the 12-month period ending June 30, 2010, by 4.2%, then the increase
for the Executive’s salary effective on July 1, 2010 shall be 4.2%. The Company may, in its sole
and absolute discretion, further increase the Executive’s base salary in light of the Executive’s
performance, inflation, changes in the cost of living and other factors deemed relevant by the
Board. The Executive’s base salary will be paid in accordance with the standard practices for
other members of senior management of the Company, but not less frequently than monthly.

     3.2 Bonuses. During the Term hereof, the Executive will be eligible to receive such
bonus awards, if any, as shall be determined by the Board in its sole and absolute discretion after
receiving the recommendation of the Compensation Committee.

     3.3 Equity Awards.

     (a) On the Effective Date, the Executive was granted two non-qualified stock options (the
“Stock Options”) under the Magellan Petroleum Corporation 1998 Stock Option Plan, as amended on
October 24, 2007 and further amended and restated by the Board of Directors on December 11, 2008
(the “Stock Incentive Plan”), which Stock Options entitle the Executive to purchase an aggregate of
three million, one hundred thousand (3,100,000) shares of Common Stock of the Company. Effective
February 2, 2009, the Executive has agreed to surrender an aggregate of 387,500 of the
non-qualified stock options previously granted to the Executive on December 11, 2008, 262,500 of
which shall be deemed to come from tranche one (time-based Options) and 125,000 of which shall be
deemed to come from tranche two (performance vesting Options) (such 387,500 options, the
“Surrendered Options”).

     (b) The terms and conditions of the Stock Options are set forth in the Option Agreements, the
form and content of which are substantially similar to the option agreements evidencing other
awards under the Stock Incentive Plan. The Executive acknowledges and agrees that the award of the
Stock Options is expressly conditioned on the receipt of shareholder approval in accordance with
the terms of the Option Agreements, the Incentive Plan and listing standards of the Nasdaq Stock
Market, Inc.

     (c) Future awards of equity under the Incentive Plan (or any successor plan), if any, shall
only be made by the Board in its sole discretion, after receipt of a recommendation by the
Compensation Committee.

     3.4 Benefit Programs. The Executive will be entitled to participate on substantially
the same terms as other members of senior management of the Company in all employee benefit plans
and programs of the Company (other than any severance plan, program or policy), subject to any
restrictions or eligibility requirements under such plans and programs, from time to time in effect
for the benefit of senior management of the Company, including, but not limited to, retirement
plans, profit sharing plans, group life insurance, hospitalization and surgical and major medical
coverages, short-term and long-term disability.

-3-

 

     3.5 Insurance Benefits.

          (a) During the Term hereof, the Company shall reimburse the Executive a maximum of $8,000 per
year for family health insurance coverage, which shall consist of medical, prescription and dental
benefits. Reimbursements under this paragraph shall be made no later than the end of the year
following the year in which such expenses were incurred by the Executive. The expenses eligible
for reimbursement during the Executive’s taxable year may not affect the expenses eligible for
reimbursement in any other year, and the right to reimbursement is not subject to liquidation or
exchange for another benefit.

          (b) The Company shall purchase a long-term disability insurance policy with coverage to age 65
for the Executive, such policy to be mutually selected by the Company and the Employee, and shall
pay the annual premiums under such policy in an annual amount not to exceed $12,500.

          (c) In addition, the Company shall purchase a ten-year, term life insurance policy for the
Executive, such policy to be mutually selected by the Company and the Employee, with aggregate
coverage of $1.5 million and shall pay the annual premiums under such policy in an annual amount
not to exceed $3,000.

     3.6 Vacations and Holidays. During the Term of this Agreement, the Executive will be
entitled to vacation leave of four (4) weeks per year at full pay or such greater vacation benefits
as may be provided for by the Company’s vacation policies applicable to senior management. The
Executive will be entitled to such holidays as are established by the Company for all employees.

     3.7 Automobile. The Company will provide the Executive with a leased automobile as
approved by the Board of Directors as per the Company’s perquisites policy from time to time.

4. Business Expenses. The Executive will be entitled to prompt reimbursement for all
reasonable, documented and necessary expenses incurred by the Executive in performing his services
hereunder in accordance with the policies of the Company, provided that the Executive properly
accounts therefor in accordance with the policies and procedures established by the Company.

5. Separation from Service. No termination shall be deemed to have occurred under this
Agreement unless there has been a “Separation from Service” as defined under Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”), and the term “termination of employment”
and the like shall be construed to mean “Separation from Service” as so defined.

6. Termination of Employment by the Company.

     6.1 Termination by the Company Other Than For Disability or Cause. The Company may
terminate the Executive’s employment at any time for any reason other than (i) by reason of the
Executive’s Disability (as defined in Section 6.2(c) hereof) or (ii) for Cause (as defined in
Section 6.3(a) hereof), by giving the Executive a written notice of termination at least thirty
(30) days before the date of termination (or such lesser notice period as the Executive may agree
to).

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In the event of such a termination of employment pursuant to this Section 6.1, the Executive
shall be entitled to receive the Severance Benefits described in Section 9 of this Agreement.

     6.2 Termination Due to Disability.

     (a) If the Executive incurs a Disability, as defined below, the Company may terminate the
Executive’s employment by giving the Executive written notice of termination at least thirty (30)
days before the date of such termination (or such lesser notice period as the Executive may agree
to). In the event of such termination of the Executive’s employment because of Disability, the
Executive shall be entitled to receive (i) his base salary pursuant to Section 3.1 through the date
of such termination of employment, plus his base salary for the period of any vacation time earned
but not taken for the year of termination of employment; (ii) any other compensation and benefits
to the extent actually earned by the Executive under any other benefit plan or program of the
Company as of the date of such termination of employment, such compensation and benefits to be paid
at the normal time for payment of such compensation and benefits to the extent not previously paid,
and (iii) any reimbursement amounts owing under Section 4 hereof.

     (b) In addition, in the event of such Disability, the Executive and/or his designated
beneficiaries shall receive the insurance benefits owed to them under the long-term disability
insurance provided by the Company under Section 3.5(b) hereof.

     (c) For purposes of this Agreement, the term “Disability” shall mean a “long-term disability”
as defined in the policy of long-term, disability insurance provided by the Company under Section
3.5(b) hereof.

     (d) If (i) the Executive incurs a Disability, as defined above; (ii) the Company terminates
the Executive’s employment with the Company under Section 6.2(a) above, and (iii) the Executive
ceases, at any time prior to 5th anniversary of the Effective Date, to qualify for
disability insurance payments under the long-term disability insurance provided by the Company
under Section 3.5(b) hereof, then the Company shall, commencing on the 1st calendar day
of the month immediately following the date on which the Executive no longer qualifies for
disability insurance payments, make monthly payments to the Executive to replace his payments under
the disability insurance (each, a “Replacement Payment”). Each Replacement Payment shall in an
amount sufficient to put the Executive in the same after-tax position (after taking into account
applicable Federal, state, local or other income taxes) that he would have been in if he had
continued to received monthly disability insurance payments. The Company’s obligation to make
monthly Replacement Payments shall continue for the lesser of (X) twenty-four (24) months, or (Y)
the number of months then remaining prior to the 5th anniversary of the Effective Date.

     6.3 Termination for Cause.

     (a) The Company may terminate the Executive’s employment immediately for Cause for any of the
following reasons: (i) an act or acts of dishonesty or fraud by the Executive relating to the
performance of his services to the Company; (ii) a breach by the Executive of his duties or
responsibilities under this Agreement resulting in significant demonstrable injury to the Company
or any of its subsidiaries; (iii) the Executive’s conviction of a felony or any crime

-5-

 

involving moral turpitude; (iv) the Executive’s material failure (for reasons other than
death, illness, injury or Disability) to perform his duties under this Agreement or insubordination
(defined as refusal to execute or carry out the lawful and ethical directions from the Board or its
duly appointed designees) where the Executive has been given written notice of the acts or
omissions constituting such failure or insubordination and the Executive has failed to cure such
conduct, where susceptible to cure, within ten days following such notice; or (v) a breach by the
Executive of any provision of any material policy of the Company or any of his obligations under
Section 14 of this Agreement.

     (b) The Company shall exercise its right to terminate the Executive’s employment for Cause by
giving the Executive written notice of termination specifying in reasonable detail the
circumstances constituting such Cause. In the event of such termination of the Executive’s
employment for Cause, the Executive shall be entitled to receive only (i) his base salary pursuant
to Section 3.1 earned through the date of such termination of employment plus his base salary for
the period of any vacation time earned but not taken for the year of termination of employment,
such base salary to be paid in a lump sum no later than the next payroll date following the
Executive’s date of termination to the extent not previously paid; (ii) any other compensation and
benefits to the extent actually earned by the Executive under any other benefit or bonus plan or
program of the Company as of the date of such termination of employment, such compensation and
benefits to be paid at the normal time for payment of such compensation and benefits to the extent
not previously paid; and (iii) any reimbursement amounts owing under Section 4 hereof.

7. Termination of Employment by the Executive.

     (a) Good Reason. The Executive may terminate his employment for Good Reason by giving
the Company a written notice of termination at least 30 days before the date of such termination
(or such lesser notice period as the Company may agree to) specifying in reasonable detail the
circumstances constituting such Good Reason. In the event of the Executive’s termination of his
employment for Good Reason, the Executive shall be entitled to receive the Severance Benefits
described in Section 9 of this Agreement. For purposes of this Agreement, “Good Reason” shall
mean, without the Executive’s written consent: (i) a material negative change in the scope of the
authority, functions, duties or responsibilities of Executive’s employment from that which is
contemplated by this Agreement; provided that a change in scope solely as a result of the Company
no longer being a public company or becoming a subsidiary of another corporation shall not
constitute Good Reason; (ii) any reduction in the Executive’s base salary under Section 3.1 hereof;
(iii) the Company materially changing the geographic location in which the Executive must perform
services from the Portland, Maine metropolitan area; or (iv) any material breach by the Company of
any provision of this Agreement without the Executive having committed any material breach of the
Executive’s obligations hereunder (including Section 14 hereof), in each case of (i), (ii), (iii)
or (iv), which breach is not cured by the Company within thirty (30) days following written notice
thereof to the Company of such breach. If an event constituting a ground for termination of
employment for Good Reason occurs, and the Executive fails to give notice of termination within
sixty (60) days after the occurrence of such event, the Executive shall be deemed to have waived
his right to terminate employment for Good Reason in connection with such event (but not for any
other event for which the sixty (60) day period has not expired). In addition, prospective changes
to employee

-6-

 

benefits for future employment made on an across-the-board basis to all similarly situated
executives of the Company and its subsidiaries shall not be considered Good Reason.

     (b) Other. The Executive may terminate his employment at any time and for any reason,
other than pursuant to subsection (a) above, by giving the Company a written notice of termination
to that effect at least sixty (60) days before the date of termination (or such lesser notice
period as the Company may agree to); provided, however, that the Company following
receipt of such notice from the Executive may elect to have the Executive’s employment terminate
immediately following its receipt of such notice. In the event of the Executive’s termination of
his employment pursuant to this subsection (b), the Executive shall be entitled to receive only:
(i) his base salary pursuant to Section 3.1 earned through the date of such termination of
employment plus his base salary for the period of vacation time earned but not taken for the year
of termination of employment, such base salary to be paid in a lump sum no later than the next
payroll date following the Executive’s date of termination to the extent not previously paid; (ii)
any other compensation and benefits to the extent actually earned by the Executive under any other
benefit or bonus plan or program of the Company as of the date of such termination of employment,
such compensation and benefits to be paid at the normal time for payment of such compensation and
benefits to the extent not previously paid; and (iii) any reimbursement amounts owing under Section
4 hereof.

8. Termination of Employment By Death.

     (a) In the event of the death of the Executive during the course of his employment hereunder,
the Executive’s estate (or other person or entity having such entitlement pursuant to the terms of
the applicable plan or program) shall be entitled to receive: (i) the Executive’s base salary
pursuant to Section 3.1 hereof earned through the date of the Executive’s death plus the
Executive’s base salary for the period of vacation time earned but not taken for the year of the
Executive’s death, such base salary to be paid in a lump sum no later than the next payroll date
following the Executive’s date of termination to the extent not previously paid; (ii) any other
compensation and benefits to the extent actually earned by the Executive under any other benefit
plan or program of the Company as of the date of such termination of employment, such compensation
and benefits to be paid at the normal time for payment of such compensation and benefits to the
extent not previously paid; and (iii) any reimbursement amounts owing under Section 4 hereof.

     (b) In addition, in the event of such death, the Executive’s beneficiaries shall receive the
insurance benefits owed to them under the term life insurance provided by the Company under Section
3.5(c) hereof and any other benefits owed to them under the Company’s employee benefit plans.

9. Severance Benefits Upon Termination Without Cause or For Good Reason. If at any time
prior to the end of the Term of this Agreement, the Executive’s employment hereunder shall
terminate because of termination by the Company pursuant to Section 6.1, or because of termination
by the Executive for Good Reason pursuant to Section 7(a), then the Executive shall be entitled to
the following:

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     (a) The Company shall pay to the Executive his base salary pursuant to Section 3.1 hereof
earned through the date of such termination of employment in a lump sum no later than the next
payroll date following the Executive’s date of termination to the extent not previously paid, and
any other compensation and benefits to the extent actually earned by the Executive under any
benefit or bonus plan or program of the Company as of the date of such termination of employment,
any such compensation and benefits to be paid at the normal time for payment of such compensation
and benefits to the extent not previously paid.

     (b) The Company shall pay the Executive any reimbursement amounts owing under Section 4
hereof.

     (c) The Company shall pay to the Executive a severance benefit (the “Severance Benefit”). The
Severance Benefit shall equal the amount of base salary that the Executive would have received if
he remained employed for the balance of the Term, based upon his then-current base salary without
further increase. However, in no event shall the Severance Benefit by less than the amount of base
salary that the Executive would have received if he remained employed for twenty-four (24) months,
based upon his then-current salary without further increase. The amount of the Severance Benefit
as so determined shall be divided into twenty-four (24) equal installments. Payment of such
installments shall be made as follows:

(i) payment shall commence on the first (1st) date of the seventh
(7th) month following the Executive’s Separation from Service. The amount of the
first payment shall equal the first seven (7) such installments.

(ii) subsequent payments shall be made on the first day of each succeeding month for the
balance of the twenty-four (24) month period.

     (d) The Company’s obligation to provide the severance benefits set forth in Sections 9(c) upon
the Executive’s termination of employment without Cause or for Good Reason, shall be subject to (i)
the Executive’s compliance with the provisions of Section 14 hereof; (ii) delivery to the Company
of the Executive’s resignation from all officer, directorships and fiduciary positions with the
Company, its subsidiaries and employee benefit plans; and (iii) the Executive’s execution without
revocation of a valid Termination, Voluntary Release and Waiver of Rights Agreement, in
substantially the form attached to this Agreement as Exhibit A (the “Release”).

10. Golden Parachute Excise Tax.

     (a) In the event that any payment or benefit received or to be received by the Executive
pursuant to this Agreement or any other plan, program or arrangement of the Company or any of its
affiliates would constitute an “excess parachute payment” within the meaning of Section 280G of the
Code (“Excess Parachute Payment”), then the payments under this Agreement shall be reduced (by the
minimum possible amounts) until no amount payable to the Executive under this Agreement constitutes
an Excess Parachute Payment; provided, however, that no such reduction shall be made if the net
after-tax payment (after taking into account Federal, state, local or other income and excise
taxes) to which the Executive would otherwise be entitled without such reduction would be greater
than the net after-tax payment

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(after taking into account Federal, state, local or other income and excise taxes) to the
Executive resulting from the receipt of such payments with such reduction. If, as a result of
subsequent events or conditions (including a subsequent payment or absence of a subsequent payment
under this Agreement or other plan, program or arrangement of the Company or any of its
affiliates), it is determined that payments under this Agreement have been reduced by more than the
minimum amount required to prevent any payments from constituting an Excess Parachute Payment, then
an additional payment shall be promptly made to the Executive in an amount equal to the additional
amount that can be paid without causing any payment to constitute an Excess Parachute Payment.

     (b) All determinations required to be made under this Section 10 shall be made by a nationally
recognized independent accounting firm mutually agreeable to the Company and the Executive (the
“Accounting Firm”) which shall provide detailed supporting calculations to the Company and the
Executive as requested by the Company or the Executive. All fees and expenses of the Accounting
Firm shall be borne solely by the Company and shall be paid by the Company upon demand of the
Executive as incurred or billed by the Accounting Firm. All determinations made by the Accounting
Firm pursuant to this Section 10 shall be final and binding upon the Company and the Executive.

     (c) In the event that a reduction is required to be made pursuant to this Section 10, then the
Severance Benefit (and the corresponding installment payments) shall be reduced to the extent
necessary to comply with this Section 10.

11. Entitlement to Other Benefits, Plans or Awards. Except as otherwise provided in this
Agreement, this Agreement shall not be construed as limiting in any way any rights or benefits that
the Executive or his spouse, dependents or beneficiaries may have pursuant to any other employee
benefit plan or program of the Company. All benefits, including, without limitation, stock
options, stock appreciation rights, restricted stock units and other awards under the Company’s
benefits, plans or programs, shall be subject to the terms and conditions of the plan or
arrangement under which such benefits accrue, are granted or are awarded. In addition, nothing
herein shall be construed to prevent the Company from amending, altering, eliminating or reducing
any benefits, plans or programs so long as the Executive continues to receive compensation and
benefits consistent with those described in Section 3 hereof.

12. Advisory Expenses. The Company hereby agrees to reimburse the Executive, on an
as-incurred basis, for his reasonable out-of-pocket expenses as determined by the Board’s
Compensation Committee incurred in negotiating and executing this Agreement, the Option Agreements
and the Indemnification Agreement, including the reasonable fees of the Executive’s legal counsel
and tax advisors during 2008 and 2009. Such reimbursements shall be made promptly and in no event
later than the year following the year in which the expense is incurred. This right of
reimbursement is not subject to liquidation or exchange for another benefit. The amount of
expenses eligible for reimbursement during any year may not affect the expenses eligible for
reimbursement in any other year.

13. Officer and Director Protections. As required by the Company’s Restated Certificate of
Incorporation, the Company shall enter into its customary Indemnification Agreement with the
Executive under which the Company agrees to indemnify the Executive to the fullest extent

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allowed under Delaware law for any claims related to the Executive’s service to the Company as
President, Chief Executive Officer and as a director.

14. Executive’s Obligations.

     (a) Confidentiality. The Executive agrees that he shall not, directly or indirectly,
use, make available, sell, disclose or otherwise communicate to any person, other than in the
course of the Executive’s employment and for the benefit of the Company, either during the period
of the Executive’s employment or at any time thereafter, any nonpublic, proprietary or confidential
information, knowledge or data relating to the Company, any of its subsidiaries, affiliated
companies or businesses, which shall have been obtained by the Executive during the Executive’s
employment by the Company. The foregoing shall not apply to information that (i) was known to the
public prior to its disclosure to the Executive; (ii) becomes known to the public subsequent to
disclosure to the Executive through no wrongful act of the Executive or any representative of the
Executive; or (iii) the Executive is required to disclose by applicable law, regulation or legal
process (provided that the Executive provides the Company with prior notice of the contemplated
disclosure and reasonably cooperates with the Company at its expense in seeking a protective order
or other appropriate protection of such information). Notwithstanding clauses (i) and (ii) of the
preceding sentence, the Executive’s obligation to maintain such disclosed information in confidence
shall not terminate where only portions of the information are in the public domain.

     (b) Non-Solicitation. In the event that the Executive receives Severance Benefits
under Section 9 of this Agreement, the Executive agrees that for the two (2) year period following
the date of termination hereof the Executive will not, directly or indirectly, individually or on
behalf of any other person, firm, corporation or other entity, knowingly solicit, aid or induce any
managerial level employee of the Company or any of its subsidiaries or affiliates to leave such
employment in order to accept employment with or render services to or with any other person, firm,
corporation or other entity unaffiliated with the Company or knowingly take any action to
materially assist or aid any other person, firm, corporation or other entity in identifying or
hiring any such employee (provided, that the foregoing shall not be violated by general advertising
not targeted at Company employees nor by serving as a reference for an employee with regard to an
entity with which the Executive is not affiliated). For the avoidance of doubt, if a managerial
level employee on his or her own initiative contacts the Executive for the primary purpose of
securing alternative employment, any action taken by the Executive thereafter shall not be deemed a
breach of this Section 14(b).

     (c) Non-Competition. The Executive acknowledges that the Executive performs services
of a unique nature for the Company that are irreplaceable, and that the Executive’s performance of
such services to a competing business will result in irreparable harm to the Company. Accordingly,
in the event that the Executive receives Severance Benefits under Section 9 of this Agreement, the
Executive agrees that for a period of two (2) years following the date of termination, the
Executive will not, directly or indirectly, become connected with, promote the interest of, or
engage in any other business or activity competing with the business of the Company within the
geographical area in which the business of the Company is conducted. The Executive specifically
acknowledges that the geographic area to which the covenants contained in this Section 14(c) shall
apply everywhere in the world (which discrete

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geographic locations shall be identified by the energy resource basins involved, not the
country or political subdivision) where the Company or its subsidiaries (i) own or otherwise hold
oil, gas or other mineral resources or assets; (ii) are otherwise actively engaged in the business
of extracting and selling oil, gas or other mineral resources or assets, or (iii) have definitive
plans for (i) or (ii) within the twelve (12) months following the date of the Executive’s
termination of employment with the Company. Notwithstanding the foregoing, the Executive shall not
be prohibited from engaging in the Permitted Activities, so long as such Permitted Activities do
not constitute an actual or potential conflict of interest with the Company’s business in the
judgment of the Board.

     (d) Non-Disparagement. Each of the Executive and the Company (for purposes of this
Section 14(d), “the Company” shall mean only (i) the Company by press release or otherwise and (ii)
the executive officers and directors thereof and not any other employees) agrees not to make any
public statements that disparage the other party, or in the case of the Company, its subsidiaries,
affiliates, officers, directors or business partners. Notwithstanding the foregoing, statements
made in the course of sworn testimony in agency, administrative, judicial or arbitral proceedings
(including, without limitation, depositions in connection with such proceedings) or otherwise as
required by law shall not be subject to this Section 14(d).

     (e) Return of Company Property and Records. The Executive agrees that upon
termination of the Executive’s employment, for any reason whatsoever, the Executive will surrender
to the Company in good condition (reasonable wear and tear excepted) all property and equipment
belonging to the Company and all records kept by the Executive containing the names, addresses or
any other information with regard to customers or customer contacts of the Company, or concerning
any proprietary or confidential information of the Company or any operational, financial or other
documents given to the Executive during the Executive’s employment with the Company.

     (f) Cooperation. The Executive agrees that, following termination of the Executive’s
employment for any reason, the Executive shall upon reasonable advance notice, and to the extent it
does not interfere with previously scheduled travel plans and does not unreasonably interfere with
other business activities or employment obligations, assist and cooperate with the Company with
regard to any matter or project in which the Executive was involved during the Executive’s
employment, including any litigation. The Company shall compensate the Executive for any lost
wages (or, if the Executive is not then employed, provide reasonable compensation as determined by
the Compensation Committee) and expenses associated with such cooperation and assistance.

     (g) Assignment of Inventions. The Executive shall promptly communicate and disclose
in writing to the Company all inventions and developments including software, whether patentable or
not, as well as patents and patent applications (hereinafter collectively called “Inventions”),
made, conceived, developed, or purchased by the Executive, or under which the Executive acquires
the right to grant licenses or to become licensed, alone or jointly with others, which have arisen
or which arise out of the Executive’s employment with the Company, or relate to any matters
directly pertaining to, the business of the Company or any of its subsidiaries. Included herein as
if developed during the employment period is any specialized equipment and software developed for
use in the business of the Company. All of the Executive’s right, title and

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interest in, to, and under all such Inventions, licenses, and right to grant licenses shall be
the sole property of the Company. As to all such Inventions, the Executive will, upon request of
the Company execute all documents which the Company deems necessary or proper to enable it to
establish title to such Inventions or other rights, and to enable it to file and prosecute
applications for letters patent of the United States and any foreign country; and do all things
(including the giving of evidence in suits and other proceedings) which the Company deems necessary
or proper to obtain, maintain, or assert patents for any and all such Inventions or to assert its
rights in any Inventions not patented.

     (h) Equitable Relief; Reformation; Survival. The Parties acknowledge and agree that
the other party’s remedies at law for a breach or threatened breach of any of the provisions of
this Section 14 would be inadequate and, in recognition of this fact, the Parties agree that, in
the event of such a breach or threatened breach, in addition to any remedies at law, the other
party, without posting any bond, shall be entitled to obtain equitable relief in the form of
specific performance, temporary restraining order, a temporary or permanent injunction or any other
equitable remedy which may then be available. If it is determined by a court of competent
jurisdiction in any state that any restriction in this Section 14 is excessive in duration or scope
or is unreasonable or unenforceable under the laws of that state, it is the intention of the
parties that such restriction may be modified or amended by the court to render it enforceable to
the maximum extent permitted by the law of that state. The obligations contained in this Section
14 shall survive the termination or expiration of the Executive’s employment with the Company and
shall be fully enforceable thereafter.

15. Alternative Dispute Resolution. Any controversy, dispute or questions arising out of,
in connection with or in relation to this Agreement or its interpretation, performance or
nonperformance or any breach thereof shall be resolved through mediation. In the event mediation
fails to resolve the dispute within 60 days after a mediator has been agreed upon or such other
longer period as may be agreed to by the parties, such controversy, dispute or question shall be
settled by arbitration in accordance with the Center for Public Resources Rules for Non
Administered Arbitration of Business Disputes, by a sole arbitrator. The arbitration shall be
governed by the United States Arbitration Act, 9 U.S.C. Sec. 1-16, and judgment upon the award
rendered by the arbitrator may be entered by any court having jurisdiction thereof. The place of
the arbitration shall be Portland, Maine.

16. General Provisions.

     16.1 No Duty to Seek Employment. The Executive shall not be under any duty or
obligation to seek or accept other employment following termination of employment, and no amount,
payment or benefits due to the Executive hereunder shall be reduced or suspended if the Executive
accepts subsequent employment, except as expressly set forth herein.

     16.2 Deductions and Withholding. All amounts payable or which become payable under
any provision of this Agreement shall be subject to any deductions authorized by the Executive and
any deductions and withholdings required by law.

     16.3 Notices. All notices, demands, requests, consents, approvals or other
communications (collectively “Notices”) required or permitted to be given hereunder or which

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are given with respect to this Agreement shall be in writing and shall be delivered
personally, sent by facsimile transmission with a copy deposited in the United States mail,
registered or certified, return receipt requested, postage prepaid, or sent by overnight mail
addressed as follows:

	 	 	 
	To the Company:

	 	Magellan Petroleum Corporation
	 

	 	10 Columbus Boulevard
	 

	 	Hartford, CT 06106
	 

	 	Attn: Chairman of the Board
	 

	 	Facsimile: (860) 293-2349
	 
	 	 
	With a copy to:

	 	Edward B. Whittemore, Esq.
	 

	 	Murtha Cullina LLP
	 

	 	CityPlace I, 185 Asylum Street
	 

	 	Hartford, CT 06103
	 

	 	Facsimile: (860) 240-6150
	 
	 	 
	To the Executive:

	 	William H. Hastings
	 

	 	2 Thurston Lane
	 

	 	Falmouth, ME 04105
	 

	 	Facsimile: 207-797-2626
	 
	 	 
	With a copy to:

	 	John L. Carpenter
	 

	 	Bernstein Shur
	 

	 	100 Middle Street
	 

	 	P. O. Box 9729
	 

	 	Portland, ME 04104
	 

	 	Facsimile: 207-774-1127

or such other address as such party shall have specified most recently by written notice. Notice
mailed as provided herein shall be deemed given when so delivered personally or sent by facsimile
transmission, or, if sent by overnight mail, on the day after the date of mailing.

     16.4 Covenant to Notify Management. The Executive shall abide by the ethics policies
of the Company as well as the Company’s other rules, regulations, policies and procedures. The
Executive agrees to comply in full with all governmental laws and regulations as well as ethics
codes applicable. In the event that the Executive is aware or suspects the Company, or any of its
officers or agents, of violating any such laws, ethics, codes, rules, regulations, policies or
procedures, the Executive agrees to bring all such actual and suspected violations to the attention
of the Company immediately so that the matter may be properly investigated and appropriate action
taken. The Executive understands that he is precluded from filing a complaint with any
governmental agency or court having jurisdiction over wrongful conduct unless the Executive has
first notified the Company of the facts and permits it to investigate and correct the concerns.

     16.5 Amendments and Waivers. No provision of this Agreement may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in writing signed by the
Executive and the Company. No waiver by either Party hereto at any time of any breach

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by the other Party hereto of, or compliance with, any condition or provision of this Agreement
to be performed by such other Party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.

     16.6 Beneficial Interests. This Agreement shall inure to the benefit of and be
enforceable by (a) the Company’s successors and assigns and (b) the Executive’s personal and legal
representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.
If the Executive shall die while any amounts are still payable to his hereunder, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to
the Executive’s devisee, legatee, or other designee or, if there be no such designee, to the
Executive’s estate.

     16.7 Successors. The Company will require any successors (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company to assume expressly and agree to perform this Agreement in the same manner
and to the same extent that the Company would be required to perform.

     16.8 Assignment. This Agreement and the rights, duties, and obligations hereunder may
not be assigned or delegated by any Party without the prior written consent of the other Party and
any attempted assignment or delegation without such prior written consent shall be void and be of
no effect. Notwithstanding the foregoing provisions of this Section 16.8, benefits payable
pursuant to this Agreement shall not be subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment or garnishment by creditors of the Executive,
and any attempt to alienate, transfer, assign or attach such benefits shall be void.
Notwithstanding the foregoing provisions of this Section 16.8, the Company may assign or delegate
its rights, duties and obligations hereunder to any affiliate or to any person or entity which
succeeds to all or substantially all of the business of the Company or one of its subsidiaries
through merger, consolation, reorganization, or other business combination or by acquisition of all
or substantially all of the assets of the Company or one of its subsidiaries without the
Executive’s consent.

     16.9 Choice of Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware without regard to the conflicts of law provisions thereof.

     16.10 Statute of Limitations. The Executive and the Company hereby agree that there
shall be a one year statute of limitations for the filing of any requests for arbitration or any
lawsuit relating to this Agreement or the terms or conditions of Executive’s employment by the
Company. If such a claim is filed more than one year subsequent to the Executive’s last day of
employment it shall be precluded by this provision, regardless of whether or not the claim has
accrued at that time.

     16.11 Right to Injunctive and Equitable Relief. The Executive’s obligations under
Section 14 of this Agreement are of a special and unique character, which gives them a peculiar
value. The Company cannot be reasonably or adequately compensated for damages in an action at law
in the event the Executive breaches such obligations. Therefore, the Executive expressly agrees
that the Company shall be entitled to injunctive and other equitable relief without bond or

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other security in the event of such breach in addition to any other rights or remedies which
the Company may possess or be entitled to pursue. Furthermore, the obligations of the Executive
and the rights and remedies of the Company under Section 14 and this Section 16.11 are cumulative
and in addition to, and not in lieu of, any obligations, rights, or remedies as created by
applicable law. The Executive agrees that the terms of this Section 16.11 shall survive the term
of this Agreement and the termination of the Executive’s employment.

     16.12 Severability or Partial Invalidity. The invalidity or unenforceability of any
provisions of this Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.

     16.13 Entire Agreement. This Agreement, along with Exhibit A attached hereto,
the Option Agreements and the Indemnification Agreement, constitute the entire agreement of the
Parties and supersedes all prior written or oral and all contemporaneous oral agreements,
understandings, and negotiations between the Parties with respect to the subject matter hereof and
thereof. This Agreement may not be changed orally and may only be modified in writing signed by
both Parties. This Agreement, along with Exhibit A attached hereto, the Option Agreements
and the Indemnification Agreement, are intended by the Parties as the final expression of their
agreement with respect to such terms as are included herein and therein and may not be contradicted
by evidence of any prior or contemporaneous agreement. The Parties further intend that this
Agreement, along with Exhibit A attached hereto, the Option Agreements and the
Indemnification Agreement, constitute the complete and exclusive statement of their terms and that
no extrinsic evidence may be introduced in any judicial proceeding involving such agreements.

     16.14 Code Section 409A. This Agreement is intended to comply with the provisions of
Section 409A of the Code. The Parties intend that the benefits and payments provided under this
Agreement shall be exempt from, or comply with, the requirements of Section 409A of the
Code.  Notwithstanding the foregoing, the Company shall in no event be obligated to indemnify the
Executive for any taxes or interest that may be assessed by the IRS pursuant to Section 409A of the
Code.

     16.15 Counterparts. This Agreement may be executed in any number of counterparts,
each of which when so executed shall be deemed an original but all of which together shall
constitute one and the same instrument.

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

-15-

 

* * * * * *

     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly
authorized officer and the Employee has hereunto set her hand as of the day and year first above
written.

	 	 	 	 	 
	 	MAGELLAN PETROLEUM CORPORATION

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

EXECUTIVE

/s/ William H. Hastings                                        

William H. Hastings

-16-

 

EXHIBIT A

TERMINATION, VOLUNTARY RELEASE AND WAIVER OF RIGHTS AGREEMENT 

     I, William H. Hastings, freely enter into this Termination, Voluntary Release and Waiver of
Rights Agreement (the “Agreement”), unqualifiedly accept and agree to the relinquishment of my
title, responsibilities and obligations as an employee of Magellan Petroleum Corporation (“the
Company”), and concurrently and unconditionally agree to sever my relationship as an employee of
the Company, in consideration for the voluntary payment to me by the Company of the termination
benefits set forth in Section 6-9 of the Employment Agreement dated as of January  ,
2009 by and between me and the Company (the “Employment Agreement”), which is made a part hereof.

1. In exchange for this consideration, which I understand that the Company is not otherwise
obligated to provide to me, I voluntarily agree to waive and forego any and all claims, rights,
interests, covenants, contracts, warranties, promises, undertakings, actions, suits, causes of
action, obligations, debts, attorneys’ fees or other expenses, accounts, judgments, fines, fees,
losses and liabilities, of any kind, nature or description, in law (including all contract and tort
claims), equity or otherwise (collectively, “Claims”) that I may have against the Company as an
employee of the Company beyond the rights set forth in the Employment Agreement and to release the
Company and their respective affiliates, subsidiaries, officers, directors, employees,
representatives, agents, successors and assigns (hereinafter collectively referred to as
“Releasees”) from any obligations any of them may owe to me in my capacity as an employee of the
Company except as set forth in my Employment Agreement (and specifically not as a shareholder or
director), accepting the aforestated consideration as full settlement of any monies or obligations
owed to me by Releasees that may have arisen at any time prior to the date of my execution of this
Termination, Voluntary Release and Waiver of Rights Agreement (the “Agreement”), except as
specifically provided below in the following paragraph number 2.

2. I do not waive, nor has the Company asked me to waive, any rights arising exclusively under the
Fair Labor Standards Act, except as such waiver may henceforth be made in a manner provided by law.
I do not waive, nor has the Company asked me to waive, any vested benefits that I may have or that
I may have derived from the course of my employment with the Company. I understand that such
vested benefits will be subject to and administered in accordance with the established and usual
terms governing same. I do not waive any rights which may in the future, after the execution of
this Agreement, arise exclusively from a substantial breach by the Company of a material obligation
of the Company expressly undertaken in consideration of my entering into this Agreement.

3. Except as set forth in paragraphs 2 and 9 hereof, I do fully, irrevocably and forever waive,
relinquish and agree to forego any and all Claims whatsoever, whether known or unknown, in
contract, tort or otherwise, that I may have or may hereafter have against the Releasees or any of
them arising out of or by reason of any cause, matter or thing whatsoever arising out of my
employment by the Company (other than as set forth in my Employment Agreement) from the beginning
of the world to the date hereof, including without limitation any

A-1

 

and all matters relating to my employment with the Company and the cessation thereof and all
matters arising under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000 et
seq., the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et
seq., the Family and Medical Leave Act of 1993, 29 U.S.C. § 2601 et seq.,
the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 621 et seq., the
Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq., all as
amended, or under any other laws, ordinances, executive orders, regulations or administrative or
judicial case law arising under the statutory or common laws of the United States, the State of
Maine or any other applicable county or municipal ordinance.

4. As a material inducement to the Company to enter into this Agreement, I, the undersigned,
recognize that I may have been privy to certain confidential, proprietary and trade secret
information of the Company which, if known to third parties, could be used in a manner that would
reduce the value of the Company for its shareholders. In order to reduce the risk of that
happening, I, the undersigned, agree that for a period of two (2) years after termination of
employment, I, the undersigned, will not, directly or indirectly, assist, or be part of or have any
involvement in, any effort to acquire control of the Company through the acquisition of its stock
or substantially all of its assets, without the prior consent of the Board of Directors of the
Company. This provision shall not prevent the undersigned from owning up to not more than one
percent (1%) of the outstanding publicly traded stock of any company.

5. Acknowledgements.

     (a) I further acknowledge pursuant to the Older Worker’s Benefit Protection Act (29 U.S.C. §
626(f)), I expressly agree that the following statements are true:

     (b) The payment of the consideration described in Section 9 of the Employment Agreement is in
addition to the standard employee benefits and anything else of value which the Company owes me in
connection with my employment with the Company or the separation of employment.

     (c) I have [twenty-one days] days from [date of receipt] to consider and sign this agreement.
If I choose to sign this Agreement before the end of the [twenty-one] day period, that decision is
completely voluntary and has not been forced on me by the Company.

     (d) I will have seven (7) days after signing the Agreement in which to revoke it, and the
Agreement will not become effective or enforceable until the end of those seven (7) days.

     (e) I am now being advised in writing to consult an attorney before signing this Agreement.

     (f) I acknowledge that I have been given sufficient time to freely consult with an attorney or
counselor of my own choosing and that I knowingly and voluntarily execute this Agreement, after
bargaining over the terms hereof, with knowledge of the consequences made clear, and with the
genuine intent to release claims without threats, duress, or coercion on the part of the Company.
I do so understanding and acknowledging the significance of such waiver.

6. Further, in view of the above-referenced consideration voluntarily provided to me by the
Company, after due deliberation, I agree to waive any right to further litigation or claim against

A-2

 

any or all of the Releasees except as specifically provided in paragraph number 2 above. I hereby
agree to indemnify and hold harmless the Releasees and their respective agents or representatives
from and against any and all losses, costs, damages or expenses, including, without limitation,
attorneys fees incurred by said parties, or any of them, arising out of any breach of this
Agreement by me or by any person acting on my behalf, or the fact that any representation made
herein by the undersigned was false when made.

7. As a material inducement to the Company to enter into this Agreement, I, the undersigned,
understand and agree that if I should fail to comply with the conditions hereof or to carry out the
agreement set forth herein, all amounts previously paid under this Agreement shall be immediately
forfeited to the Company and that the right or claim to further payments and/or benefits hereunder
would likewise be forfeited.

8. As a further material inducement to the Company to enter into this Agreement, the undersigned
provides as follows:

     First. I represent that I have not filed any complaints or charges against the
Company, or any of the Releasees relating to the relinquishment of my former titles and
responsibilities at the Company or the terms of my employment with the Company and that if any
agency or court assumes jurisdiction of any complaint or charge against the Company or any of the
Releasees on behalf of me concerning my employment with the Company, I understand and agrees that I
have, by my knowing and willing execution of this Agreement, waived my rights to any form of
recovery or relief against the Company, or any of the Releasees, including but not limited to,
attorney’s fees; provided, however, that this provision shall not preclude the
undersigned from pursuing appropriate legal relief against the Company for redress of a substantial
breach of a material obligation of the Company expressly undertaken in consideration of my entering
into this Agreement.

     Second. I acknowledge and understand that the consideration for this release shall
not be in any way construed as an admission by the Company or any of the Releasees of any improper
acts or any improper employment decisions, and that the Company, specifically disclaims any
liability on the part of itself, the Releasees, and their respective agents, employees,
representatives, successors or assigns in this regard.

     Third. I acknowledge and agree that this Agreement shall be binding upon me, upon the
Company, and upon our respective administrators, representatives, executives, successors, heirs and
assigns and shall inure to the benefit of said parties and each of them.

     Fourth. I represent, understand and agree that this Agreement sets forth the entire
agreement between the parties hereto, and fully supersedes any and all prior agreements or
understandings between the parties pertaining to the subject matter hereof, except for the
provisions of Section 14 of the Agreement, the terms of which retain their full force and effect,
and which are in no way limited or curtailed by this Agreement.

     Fifth. Modification. This Agreement may not be altered or changed except by
an agreement in writing that has been properly executed by the party against whom any waiver,
change, modification or discharge is sought.

     Sixth. Severability. All provisions and terms of this Agreement are
severable. The

A-3

 

invalidity or unenforceability of any particular provision(s) or term(s) of this Agreement shall
not affect the validity or enforceability of the other provisions and such other provisions shall
be enforceable in law or equity in all respects as if such particular invalid or unenforceable
provision(s) or term(s) were omitted. Notwithstanding the foregoing, the language of all parts of
this Agreement shall, in all cases, be construed as a whole, according to its fair meaning, and not
strictly for or against any of the parties.

     Seventh. No Disparagement. I agree and promise that I will not make any oral
or written statements or reveal any information to any person, company, or agency which is
disparaging or damaging to the reputation or business of the Company, its subsidiaries, directors,
officers or affiliates, or which would interfere in any way with the business relations between the
Company or any of its subsidiaries or affiliates and any of their customers, suppliers or vendors
whether present or in the future; provided however, that statements made in the course of
sworn testimony in agency, administrative, judicial or arbitral proceedings (including, without
limitation, depositions in connection with such proceedings) or otherwise as required by law shall
not be subject to this section Seventh,

     Eighth. Confidentiality. The Company and the undersigned agree to refrain
from disclosing to third parties and to keep strictly confidential all details of this Agreement
and any and all information relating to its negotiation, except as necessary to each party’s
accountants or attorneys.

     Ninth. Termination of Agreement. Notwithstanding anything to the contrary in
this Agreement, this Agreement may be terminated by the Company and all further payment obligations
of the Company shall cease, if: (a) the undersigned is terminated for “Cause” prior to the
undersigned’s separation date; or (b) facts are discovered after the undersigned’s separation date
that would have supported a termination for “Cause” had such facts been discovered prior to the
undersigned’s separation date.

9. Notwithstanding anything herein to the contrary, this release shall not affect, release or
terminate in any way the undersigned’s rights (i) to receive payments under the Employment
Agreement (ii) under the Indemnification Agreement entered by the Company and the undersigned with
respect to certain liabilities that the undersigned may incur as an officer or director of the
Company or (iii) under various option agreements and grants from the Company to the undersigned, or
any agreement between the undersigned and the Company relating to the undersigned’s rights as an
owner of stock or options in the Company or the undersigned’s service as a director of the Company.

A-4

 

AFFIRMATION OF RELEASOR 

     I, William H. Hastings, warrant that I am competent to execute this Termination, Voluntary
Release and Waiver of Rights Agreement and that I accept full responsibility thereof.

     I, William H. Hastings, warrant that I have had the opportunity to consult with an attorney of
my choosing with respect to this matter and the consequences of my executing this Termination,
Voluntary Release and Waiver of Rights Agreement.

     I, William H. Hastings, have read this Termination, Voluntary Release and Waiver of Rights
Agreement carefully and I fully understand its terms. I execute this document voluntarily with
full and complete knowledge of its significance.

     Executed this          
            day of                     , 20      at
              
                          
.

	 	 	 	 	 	 	 
	STATE OF                          

	)	 	 	 	 	 
	 
	 

	:	 	 	 	 	ss.                                                                          
   , 20     
	 
	COUNTY OF                      

	)	 	 	 	 	 

     Subscribed and sworn to before me, a Notary Public in and for said County and State, this 
 day of                      , 20      under the pains and penalties of perjury.

, Notary Public

My Commission Expires:

County of Residence:

A-5

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