10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

OR

☐    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 001-38083

Magnolia Oil & Gas Corporation

(Exact Name of Registrant as Specified in its Charter)

Delaware		81-5365682
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
Nine Greenway Plaza, Suite 1300		77046
Houston,	Texas
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (713) 842-9050

Securities registered pursuant to section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $0.0001	MGY	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of July 31, 2023, there were 187,903,674 shares of Class A Common Stock, $0.0001 par value per share, and 21,826,805 shares of Class B Common Stock, $0.0001 par value per share, outstanding.

GLOSSARY OF CERTAIN TERMS AND CONVENTIONS USED HEREIN

The following are definitions of certain other terms and conventions that are used in this Quarterly Report on Form 10-Q:

The “Company” or “Magnolia.” Magnolia Oil & Gas Corporation (either individually or together with its consolidated subsidiaries, as the context requires, including Magnolia Holdings, Magnolia Intermediate, Magnolia LLC, Magnolia Operating, and Magnolia Oil & Gas Finance Corp.).

“Magnolia Holdings.” Magnolia Oil & Gas Holdings LLC.

“Magnolia Intermediate.” Magnolia Oil & Gas Intermediate LLC.

“Magnolia LLC.” Magnolia Oil & Gas Parent LLC.

“Magnolia LLC Units.” Units representing limited liability company interests in Magnolia LLC.

“Magnolia Operating.” Magnolia Oil & Gas Operating LLC.

“Highlander.” Highlander Oil & Gas Holdings LLC.

“EnerVest.” EnerVest, Ltd.

“Karnes County Assets.” Certain right, title, and interest in certain oil and natural gas assets located primarily in the Karnes County portion of the Eagle Ford Shale formation in South Texas.

“Class A Common Stock.” Magnolia’s Class A Common Stock, par value $0.0001 per share.

“Class B Common Stock.” Magnolia’s Class B Common Stock, par value $0.0001 per share.

“Issuers.” Magnolia Operating and Magnolia Oil & Gas Finance Corp., a wholly owned subsidiary of Magnolia Operating, as it relates to the 2026 Senior Notes.

“Magnolia LLC Unit Holders.” EnerVest Energy Institutional Fund XIV-A, L.P., a Delaware limited partnership, EnerVest Energy Institutional Fund XIV-WIC, L.P., a Delaware limited partnership, EnerVest Energy Institutional Fund XIV-2A, L.P., a Delaware limited partnership, EnerVest Energy Institutional Fund XIV-3A, L.P., a Delaware limited partnership, and EnerVest Energy Institutional Fund XIV-C-AIV, L.P., a Delaware limited partnership.

“RBL Facility.” Senior secured reserve-based revolving credit facility, as amended February 16, 2022.

“2026 Senior Notes.” 6.0% Senior Notes due 2026.

“Stockholder Agreement.” The Stockholder Agreement, dated as of July 31, 2018, by and between the Company and the other parties thereto.

“OPEC.” The Organization of the Petroleum Exporting Countries.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Balance Sheets	1
	Consolidated Statements of Operations (unaudited)	2
	Consolidated Statements of Changes in Stockholders’ Equity (unaudited)	3
	Consolidated Statements of Cash Flows (unaudited)	5
	Notes to Consolidated Financial Statements (unaudited)	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24
Item 4.	Controls and Procedures	24
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3.	Defaults Upon Senior Securities	25
Item 4.	Mine Safety Disclosures	25
Item 5.	Other Information	26
Item 6.	Exhibits	27
Signatures		28

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

Magnolia Oil & Gas Corporation

Consolidated Balance Sheets

(In thousands)

	June 30, 2023		December 31, 2022
ASSETS	(Unaudited)		(Audited)
CURRENT ASSETS
Cash and cash equivalents	$	676,568	$	675,441
Accounts receivable	137,379		170,770
Drilling advances	12		3,484
Other current assets	881		1,052
Total current assets	814,840		850,747
PROPERTY, PLANT AND EQUIPMENT
Oil and natural gas properties	3,114,361		2,940,011
Other	9,350		8,991
Accumulated depreciation, depletion and amortization	(1,524,207)		(1,415,973)
Total property, plant and equipment, net	1,599,504		1,533,029
OTHER ASSETS
Deferred financing costs, net	4,744		5,636
Deferred tax assets	131,404		162,792
Other long-term assets	16,229		20,381
Total other assets	152,377		188,809
TOTAL ASSETS	$	2,566,721	$	2,572,585
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	166,234	$	202,846
Other current liabilities (Note 5)	96,766		137,427
Total current liabilities	263,000		340,273
LONG-TERM LIABILITIES
Long-term debt, net	391,590		390,383
Asset retirement obligations, net of current	92,820		95,129
Other long-term liabilities	9,453		6,609
Total long-term liabilities	493,863		492,121
COMMITMENTS AND CONTINGENCIES (Note 7)
STOCKHOLDERS’ EQUITY
Class A Common Stock, $0.0001 par value, 1,300,000 shares authorized, 214,400 shares issued and 188,066 shares outstanding in 2023 and 213,727 shares issued and 192,043 shares outstanding in 2022	21		21
Class B Common Stock, $0.0001 par value, 225,000 shares authorized, 21,827 shares issued and outstanding in 2023 and 2022	2		2
Additional paid-in capital	1,731,059		1,719,875
Treasury Stock, at cost, 26,334 shares and 21,684 shares in 2023 and 2022, respectively	(425,604)		(329,512)
Retained earnings	329,011		185,669
Noncontrolling interest	175,369		164,136
Total equity	1,809,858		1,740,191
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,566,721	$	2,572,585

The accompanying notes are an integral part of these consolidated financial statements.

1

Magnolia Oil & Gas Corporation

Consolidated Statements of Operations (Unaudited)

(In thousands, except per share data)

	Three Months Ended				Six Months Ended
	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
REVENUES
Oil revenues	$	223,147	$	332,791	$	462,269	$	595,459
Natural gas revenues	20,847		85,345		48,619		141,925
Natural gas liquids revenues	36,297		66,513		77,786		125,105
Total revenues	280,291		484,649		588,674		862,489
OPERATING EXPENSES
Lease operating expenses	36,796		32,604		79,167		61,348
Gathering, transportation and processing	10,389		16,381		23,121		32,221
Taxes other than income	15,216		27,411		34,508		48,293
Exploration expenses	—		3,408		11		8,946
Asset retirement obligations accretion	823		802		1,664		1,590
Depreciation, depletion and amortization	77,008		57,254		147,710		110,360
Impairment of oil and natural gas properties	—		—		15,735		—
General and administrative expenses	18,726		18,530		38,492		35,601
Total operating expenses	158,958		156,390		340,408		298,359
OPERATING INCOME	121,333		328,259		248,266		564,130
OTHER INCOME (EXPENSE)
Interest expense, net	(1,149)		(7,017)		(662)		(16,374)
Other income, net	9,259		6,538		8,120		6,744
Total other income (expense), net	8,110		(479)		7,458		(9,630)
INCOME BEFORE INCOME TAXES	129,443		327,780		255,724		554,500
Income tax expense	24,847		27,875		44,452		45,975
NET INCOME	104,596		299,905		211,272		508,525
LESS: Net income attributable to noncontrolling interest	13,104		49,322		23,446		91,903
NET INCOME ATTRIBUTABLE TO CLASS A COMMON STOCK	$	91,492	$	250,583	$	187,826	$	416,622
NET INCOME PER SHARE OF CLASS A COMMON STOCK
Basic	$	0.48	$	1.32	$	0.97	$	2.23
Diluted	$	0.48	$	1.32	$	0.97	$	2.22
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
Basic	189,402		188,146		190,584		185,377
Diluted	189,567		188,589		190,875		185,894

The accompanying notes are an integral part of these consolidated financial statements.

2

Magnolia Oil & Gas Corporation

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

(In thousands)

	Class A Common Stock			Class B Common Stock			Additional Paid In Capital		Treasury Stock			Retained Earnings/ (Accumulated Deficit)		Total Stockholders’ Equity		Noncontrolling Interest		Total Equity
For the Three Months Ended June 30, 2022	Shares	Value		Shares	Value				Shares	Value
Balance, March 31, 2022	203,762	$	20	35,594	$	4	$	1,649,111	16,218	$	(209,418)	$	(542,129)	$	897,588	$	174,780	$	1,072,368
Stock based compensation expense, net of forfeitures	—	—		—	—		2,990		—	—		—		2,990		527		3,517
Changes in ownership interest adjustment	—	—		—	—		(4,305)		—	—		—		(4,305)		4,305		—
Common stock issued related to stock based compensation and other, net	83	—		—	—		(159)		—	—		—		(159)		(29)		(188)
Class A Common Stock repurchases	—	—		—	—		—		2,065	(48,419)		—		(48,419)		—		(48,419)
Class B Common Stock purchase and cancellation	—	—		(2,000)	—		—		—	—		—		—		(54,020)		(54,020)
Conversion of Class B Common Stock to Class A Common Stock	4,884	1		(4,884)	(1)		—		—	—		—		—		—		—
Distributions to noncontrolling interest owners	—	—		—	—		—		—	—		—		—		(4,606)		(4,606)
Net income	—	—		—	—		—		—	—		250,583		250,583		49,322		299,905
Balance, June 30, 2022	208,729	$	21	28,710	$	3	$	1,647,637	18,283	$	(257,837)	$	(291,546)	$	1,098,278	$	170,279	$	1,268,557
For the Three Months Ended June 30, 2023
Balance, March 31, 2023	214,355	$	21	21,827	$	2	$	1,720,487	24,084	$	(380,783)	$	259,636	$	1,599,363	$	167,714	$	1,767,077
Stock based compensation expense, net of forfeitures	—	—		—	—		3,668		—	—		—		3,668		424		4,092
Changes in ownership interest adjustment	—	—		—	—		2,936		—	—		—		2,936		(2,769)		167
Common stock issued related to stock based compensation and other, net	45	—		—	—		(137)		—	—		—		(137)		(15)		(152)
Class A Common Stock repurchases	—	—		—	—		—		2,250	(44,821)		—		(44,821)		—		(44,821)
Dividends declared ($0.115 per share)	—	—		—	—		—		—	—		(22,117)		(22,117)		—		(22,117)
Distributions to noncontrolling interest owners	—	—		—	—		—		—	—		—		—		(3,089)		(3,089)
Adjustment to deferred taxes	—	—		—	—		4,543		—	—		—		4,543		—		4,543
Tax impact of equity transactions	—	—		—	—		(438)		—	—		—		(438)		—		(438)
Net income	—	—		—	—		—		—	—		91,492		91,492		13,104		104,596
Balance, June 30, 2023	214,400	$	21	21,827	$	2	$	1,731,059	26,334	$	(425,604)	$	329,011	$	1,634,489	$	175,369	$	1,809,858

The accompanying notes are an integral part of these consolidated financial statements.

3

Magnolia Oil & Gas Corporation

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

(In thousands)

	Class A Common Stock			Class B Common Stock			Additional Paid In Capital		Treasury Stock			Retained Earnings/ (Accumulated Deficit)		Total Stockholders’ Equity		Noncontrolling Interest		Total Equity
For the Six Months Ended June 30, 2022	Shares	Value		Shares	Value				Shares	Value
Balance, December 31, 2021	193,437	$	19	49,293	$	5	$	1,689,500	14,168	$	(164,599)	$	(708,168)	$	816,757	$	228,492	$	1,045,249
Stock based compensation expense, net of forfeitures	—	—		—	—		5,349		—	—		—		5,349		1,053		6,402
Changes in ownership interest adjustment	—	—		—	—		(4,900)		—	—		—		(4,900)		4,900		—
Common stock issued related to stock based compensation and other, net	659	—		—	—		(5,029)		—	—		—		(5,029)		(1,073)		(6,102)
Class A Common Stock repurchases	—	—		—	—		—		4,115	(93,238)		—		(93,238)		—		(93,238)
Class B Common Stock purchase and cancellation	—	—		(5,950)	—		—		—	—		—		—		(138,753)		(138,753)
Conversion of Class B Common Stock to Class A Common Stock	14,633	2		(14,633)	(2)		—		—	—		—		—		—		—
Dividends declared ($0.20 per share)	—	—		—	—		(37,283)		—	—		—		(37,283)		—		(37,283)
Distributions to noncontrolling interest owners	—	—		—	—		—		—	—		—		—		(16,243)		(16,243)
Net income	—	—		—	—		—		—	—		416,622		416,622		91,903		508,525
Balance, June 30, 2022	208,729	$	21	28,710	$	3	$	1,647,637	18,283	$	(257,837)	$	(291,546)	$	1,098,278	$	170,279	$	1,268,557
For the Six Months Ended June 30, 2023
Balance, December 31, 2022	213,727	$	21	21,827	$	2	$	1,719,875	21,684	$	(329,512)	$	185,669	$	1,576,055	$	164,136	$	1,740,191
Stock based compensation expense, net of forfeitures	—	—		—	—		7,053		—	—		—		7,053		810		7,863
Changes in ownership interest adjustment	—	—		—	—		6,875		—	—		—		6,875		(6,708)		167
Common stock issued related to stock based compensation and other, net	673	—		—	—		(6,262)		—	—		—		(6,262)		(716)		(6,978)
Class A Common Stock repurchases	—	—		—	—		—		4,650	(96,092)		—		(96,092)		—		(96,092)
Dividends declared ($0.23 per share)	—	—		—	—				—	—		(44,484)		(44,484)		—		(44,484)
Distributions to noncontrolling interest owners	—	—		—	—		—		—	—		—		—		(5,599)		(5,599)
Adjustment to deferred taxes	—	—		—	—		4,327		—	—		—		4,327		—		4,327
Tax impact of equity transactions	—	—		—	—		(809)		—	—		—		(809)		—		(809)
Net income	—	—		—	—		—		—	—		187,826		187,826		23,446		211,272
Balance, June 30, 2023	214,400	$	21	21,827	$	2	$	1,731,059	26,334	$	(425,604)	$	329,011	$	1,634,489	$	175,369	$	1,809,858

The accompanying notes are an integral part of these consolidated financial statements.

4

Magnolia Oil & Gas Corporation

Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

	Six Months Ended
	June 30, 2023		June 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES
NET INCOME	$	211,272	$	508,525
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization	147,710		110,360
Exploration expenses, non-cash	9		—
Impairment of oil and natural gas properties	15,735		—
Asset retirement obligations accretion	1,664		1,590
Amortization of deferred financing costs	2,100		3,779
(Gain) on sale of assets	(3,946)		—
Deferred income tax expense	36,264		—
Stock based compensation	7,863		6,402
Changes in operating assets and liabilities:
Accounts receivable	32,922		(97,633)
Accounts payable	(36,189)		58,935
Accrued liabilities	(4,836)		27,675
Drilling advances	3,472		578
Other assets and liabilities, net	7,556		(2,207)
Net cash provided by operating activities	421,596		618,004
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions	(3,357)		(4,347)
Additions to oil and natural gas properties	(225,388)		(207,461)
Changes in working capital associated with additions to oil and natural gas properties	(39,424)		25,494
Other investing	(88)		(1,018)
Net cash used in investing activities	(268,257)		(187,332)
CASH FLOW FROM FINANCING ACTIVITIES
Class A Common Stock repurchases	(94,942)		(92,155)
Class B Common Stock purchases and cancellations	—		(138,753)
Dividends paid	(44,684)		(37,176)
Cash paid for debt modification	—		(5,272)
Distributions to noncontrolling interest owners	(5,599)		(16,243)
Other financing activities	(6,987)		(6,164)
Net cash used in financing activities	(152,212)		(295,763)
NET CHANGE IN CASH AND CASH EQUIVALENTS	1,127		134,909
Cash and cash equivalents – Beginning of period	675,441		366,982
Cash and cash equivalents – End of period	$	676,568	$	501,891
SUPPLEMENTAL CASH FLOW INFORMATION:
Supplemental cash items:
Cash paid for income taxes	$	7,828	$	37,138
Cash paid for interest	13,175		12,733
Supplemental non-cash investing and financing activity:
Accruals or liabilities for capital expenditures	$	28,500	$	55,430
Supplemental non-cash lease operating activity:
Right-of-use assets obtained in exchange for operating lease obligations	$	7,673	$	2,462

The accompanying notes are an integral part of these consolidated financial statements.

5

Magnolia Oil & Gas Corporation

Notes to Consolidated Financial Statements

1. Description of Business and Basis of Presentation

Organization and Nature of Operations

Magnolia Oil & Gas Corporation (the “Company” or “Magnolia”) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of oil, natural gas, and natural gas liquid (“NGL”) reserves. The Company’s oil and natural gas properties are located primarily in Karnes County and the Giddings area in South Texas where the Company targets the Eagle Ford Shale and Austin Chalk formations. Magnolia’s objective is to generate stock market value over the long-term through consistent organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow.

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, certain disclosures normally included in an Annual Report on Form 10-K have been omitted. The consolidated financial statements and related notes included in this Quarterly Report should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2022 (the “2022 Form 10-K”). Except as disclosed herein, there have been no material changes to the information disclosed in the Notes to the consolidated financial statements included in the Company’s 2022 Form 10-K.

In the opinion of management, all normal, recurring adjustments and accruals considered necessary to present fairly, in all material respects, the Company’s interim financial results have been included. Operating results for the periods presented are not necessarily indicative of expected results for the full year.

Certain reclassifications of prior period financial statements have been made to conform to current reporting practices. The consolidated financial statements include the accounts of the Company and its subsidiaries after elimination of intercompany transactions and balances. The Company’s interests in oil and natural gas exploration and production ventures and partnerships are proportionately consolidated. The Company reflects a noncontrolling interest representing primarily the interest owned by the Magnolia LLC Unit Holders through their ownership of Magnolia LLC Units in the consolidated financial statements. The noncontrolling interest is presented as a component of equity. See Note 9—Stockholders’ Equity for further discussion of the noncontrolling interest.

2. Summary of Significant Accounting Policies

As of June 30, 2023, the Company’s significant accounting policies are consistent with those discussed in Note 1—Organization and Summary of Significant Accounting Policies of its consolidated financial statements contained in the Company’s 2022 Form 10-K.

3. Revenue Recognition

Magnolia’s revenues include the sale of crude oil, natural gas, and NGLs. The Company has concluded that disaggregating revenue by product type appropriately depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors and has reflected this disaggregation of revenue on the Company’s consolidated statements of operations for all periods presented. The Company’s receivables consist mainly of trade receivables from commodity sales and joint interest billings due from owners on properties the Company operates. Receivables from contracts with customers totaled $96.4 million as of June 30, 2023 and $138.6 million as of December 31, 2022. For further detail regarding the Company’s revenue recognition policies, please refer to Note 1—Organization and Summary of Significant Accounting Policies of the consolidated financial statements contained in the Company’s 2022 Form 10-K.

6

4. Fair Value Measurements

Certain of the Company’s assets and liabilities are carried at fair value and measured either on a recurring or nonrecurring basis. The Company’s fair value measurements are based either on actual market data or assumptions that other market participants would use in pricing an asset or liability in an orderly transaction, using the valuation hierarchy prescribed by GAAP under Accounting Standards Codification (“ASC”) 820.

The three levels of the fair value hierarchy under ASC 820 are as follows:

Level 1 - Quoted prices (unadjusted) in active markets for identical investments at the measurement date are used.

Level 2 - Pricing inputs are other than quoted prices included within Level 1 that are observable for the investment, either directly or indirectly. Level 2 pricing inputs include quoted prices for similar investments in active markets, quoted prices for identical or similar investments in markets that are not active, inputs other than quoted prices that are observable for the investment, and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Pricing inputs are unobservable and include situations where there is little, if any, market activity for the investment. The inputs used in determination of fair value require significant judgment and estimation.

Recurring Fair Value Measurements

The carrying value and fair value of the financial instrument that is not carried at fair value in the Company’s consolidated balance sheets at June 30, 2023 and December 31, 2022 are as follows:

	June 30, 2023				December 31, 2022
(In thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Long-term debt	$	391,590	$	388,800	$	390,383	$	382,704

The fair value of the 2026 Senior Notes at June 30, 2023 and December 31, 2022 is based on unadjusted quoted prices in an active market, which is considered a Level 1 input in the fair value hierarchy.

The Company has other financial instruments consisting primarily of receivables, payables, and other current assets and liabilities that approximate fair value due to the nature of the instruments and their relatively short maturities. Non-financial assets and liabilities initially measured at fair value include assets acquired and liabilities assumed in business combinations and asset retirement obligations.

Nonrecurring Fair Value Measurements

Certain of the Company’s assets and liabilities are measured at fair value on a nonrecurring basis. Specifically, stock based compensation is not measured at fair value on an ongoing basis but is subject to fair value calculations in certain circumstances. For further detail, see Note 10—Stock Based Compensation in the Notes to the consolidated financial statements. There were no other material nonrecurring fair value measurements as of June 30, 2023 or December 31, 2022.

5. Other Current Liabilities

The following table provides detail of the Company’s other current liabilities for the periods presented:

(In thousands)	June 30, 2023		December 31, 2022
Accrued capital expenditures	$	28,500	$	67,923
Other	68,266		69,504
Total other current liabilities	$	96,766	$	137,427

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6. Long-term Debt

The Company’s long-term debt is comprised of the following:

(In thousands)	June 30, 2023		December 31, 2022
Revolving credit facility	$	—	$	—
Senior Notes due 2026	400,000		400,000
Total long-term debt	400,000		400,000
Less: Unamortized deferred financing cost	(8,410)		(9,617)
Long-term debt, net	$	391,590	$	390,383

Credit Facility

The original RBL Facility was entered into by and among Magnolia Operating, as borrower, Magnolia Intermediate, as its holding company, the banks, financial institutions, and other lending institutions from time to time party thereto, as lenders, the other parties from time to time party thereto, and Citibank, N.A., as administrative agent, collateral agent, issuing bank, and swingline lender. On February 16, 2022, Magnolia Operating, as borrower, amended and restated the RBL Facility in its entirety, providing for maximum commitments in an aggregate principal amount of $1.0 billion with a letter of credit facility with a $50.0 million sublimit, with a borrowing base of $450.0 million. The RBL Facility, maturing in February 2026, is guaranteed by certain parent companies and subsidiaries of Magnolia LLC and is collateralized by certain of Magnolia Operating’s oil and natural gas properties.

Borrowings under the RBL Facility bear interest, at Magnolia Operating’s option, at a rate per annum equal to either the term SOFR rate or the alternative base rate plus the applicable margin. Additionally, Magnolia Operating is required to pay a commitment fee quarterly in arrears in respect of unused commitments under the RBL Facility. The applicable margin and the commitment fee rate are calculated based upon the utilization levels of the RBL Facility as a percentage of unused lender commitments then in effect.

The RBL Facility contains certain affirmative and negative covenants customary for financings of this type, including compliance with a leverage ratio of less than 3.50 to 1.00 and a current ratio of greater than 1.00 to 1.00. As of June 30, 2023, the Company was in compliance with all covenants under the RBL Facility. The Company incurred approximately $5.5 million of lender and transaction fees related to the modification of which $5.1 million were recorded as deferred financing costs and will be amortized prospectively over the remaining term of the RBL Facility and $0.4 million of which were expensed and are reflected in “Interest expense, net” on the Company’s consolidated statements of operations for the six months ended June 30, 2022.

Deferred financing costs in connection with the RBL Facility are amortized on a straight-line basis over a period of four years from February 2022 to February 2026 and included in “Interest expense, net” in the Company’s consolidated statements of operations. The Company recognized interest expense related to the RBL Facility of $1.0 million for each of the three months ended June 30, 2023 and 2022, and $2.1 million and $3.7 million for the six months ended June 30, 2023 and 2022, respectively. The unamortized portion of the deferred financing costs is included in “Deferred financing costs, net” on the Company’s consolidated balance sheets as of June 30, 2023 and December 31, 2022.

The Company did not have any outstanding borrowings under the RBL Facility as of June 30, 2023.

2026 Senior Notes

On July 31, 2018, the Issuers issued and sold $400.0 million aggregate principal amount of 2026 Senior Notes in a private placement under Rule 144A and Regulation S under the Securities Act of 1933, as amended. The 2026 Senior Notes were issued under the Indenture, dated as of July 31, 2018 (the “Indenture”), by and among the Issuers and Deutsche Bank Trust Company Americas, as trustee. On April 5, 2021, the terms of the Indenture were amended to modify, among other things, the criteria used by the Company to make Restricted Payments (as defined in the Indenture). The 2026 Senior Notes are guaranteed on a senior unsecured basis by the Company, Magnolia Operating, and Magnolia Intermediate and may be guaranteed by certain future subsidiaries of the Company. The 2026 Senior Notes will mature on August 1, 2026 and bear interest at the rate of 6.0% per annum.

Deferred financing costs related to the issuance of, and the amendment to the Indenture governing, the 2026 Senior Notes are amortized using the effective interest method over the term of the 2026 Senior Notes and are included in “Interest expense, net” in the Company’s consolidated statements of operations. The unamortized portion of the deferred financing costs is included as a reduction to the carrying value of the 2026 Senior Notes, which has been recorded as “Long-term debt, net” on the Company’s consolidated balance sheets as of June 30, 2023 and December 31, 2022. The Company recognized interest expense related to the 2026 Senior

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Notes of $6.6 million for each of the three months ended June 30, 2023 and 2022, and $13.2 million and $13.1 million for the six months ended June 30, 2023 and 2022, respectively.

At any time, the Issuers may redeem all or a part of the 2026 Senior Notes based on principal plus a set premium, as set forth in the Indenture, including any accrued and unpaid interest.

7. Commitments and Contingencies

Legal Matters

From time to time, the Company is or may become involved in litigation in the ordinary course of business.

Certain of the Magnolia LLC Unit Holders and EnerVest Energy Institutional Fund XIV-C, L.P. (collectively the “Co-Defendants”) and the Company have been named as defendants in a lawsuit where the plaintiffs claim to be entitled to a minority working interest in certain Karnes County Assets. The litigation is in the pre-trial stage. The exposure related to this litigation is currently not reasonably estimable. The Co-Defendants retain all such liability.

A mineral owner in a Magnolia operated well in Karnes County, Texas filed a complaint with the Texas Railroad Commission (the “Commission”) challenging the validity of the permit to drill such well by questioning the long-standing process by which the Commission granted the permit. After the Commission affirmed the granting of the permit, and after judicial review of the Commission’s order by the 53rd Judicial District Court Travis County, Texas (the “District Court”), the District Court reversed and remanded the Commission’s order. Upon appeal to the Third Court of Appeals in Austin, Texas (the“Court of Appeals”), the Court of Appeals reversed in part and affirmed in part the District Court’s ruling and remanded the matter to the Commission. The plaintiffs have filed a motion for rehearing with the Court of Appeals, and the parties are waiting for the Court’s decision.

At June 30, 2023, the Company does not believe the outcome of any such disputes or legal actions will have a material effect on its consolidated statements of operations, balance sheet, or cash flows. No amounts were accrued with respect to outstanding litigation at June 30, 2023 or June 30, 2022.

Environmental Matters

The Company, as an owner or lessee and operator of oil and natural gas properties, is subject to various federal, state, and local laws and regulations relating to discharge of materials into, and the protection of, the environment. These laws and regulations may, among other things, impose liability on a lessee under an oil and natural gas lease for the cost of pollution clean-up resulting from operations and subject the lessee to liability for pollution damages. In some instances, the Company may be directed to suspend or cease operations in an affected area. The Company maintains insurance coverage, which it believes is customary in the industry, although the Company is not fully insured against all environmental risks.

Risks and Uncertainties 

The Company’s revenue, profitability, and future growth are substantially dependent upon the prevailing and future prices for oil and natural gas, which depend on numerous factors beyond the Company’s control such as overall oil and natural gas production and inventories in relevant markets, economic conditions, the global and domestic political environments, regulatory developments, and competition from other energy sources. Oil and natural gas prices historically have been volatile and may be subject to significant fluctuations in the future. Additionally, the economy is experiencing elevated inflation levels as a result of global supply and demand imbalances. Inflationary pressures and labor shortages could result in further increases to our operating and capital costs.

Russia’s invasion of Ukraine in the first quarter of 2022, and global sanctions placed on Russia in response, have had and may continue to have a global impact on supply and demand for oil and natural gas. Magnolia continues to monitor any impacts from the Russia-Ukraine war on the global markets for its commodities.

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8. Income Taxes

The Company’s income tax provision consists of the following components:

	Three Months Ended				Six Months Ended
(In thousands)	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Current:
Federal	$	3,405	$	25,902	$	7,055	$	42,687
State	581		1,973		1,133		3,288
Total current	3,986		27,875		8,188		45,975
Deferred:
Federal	20,025		—		34,845		—
State	836		—		1,419		—
Total deferred	20,861		—		36,264		—
Income tax expense	$	24,847	$	27,875	$	44,452	$	45,975

The Company is subject to U.S. federal income tax and margin tax in the state of Texas. The Company estimates its annual effective tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which it operates. The Company’s effective tax rate for the three months ended June 30, 2023 and 2022 was 19.2% and 8.5%, respectively, and 17.4% and 8.3% for the six months ended June 30, 2023 and 2022, respectively. As a result of impairments in the first quarter of 2020, the Company established full valuation allowances on the federal and state deferred tax assets, which resulted in additional differences between the effective tax rate and the statutory rate as of June 30, 2022. As of December 31, 2022, the Company released the valuation allowance against net deferred tax assets. The primary differences between the annual effective tax rate and the statutory rate of 21.0% are income attributable to noncontrolling interest, state taxes, and valuation allowances.

As of June 30, 2023, the Company does not anticipate recognition of any significant liabilities for uncertain tax positions during the next 12 months. For the six months ended June 30, 2023, no significant amounts were incurred for interest and penalties. Currently, the Company is not aware of any issues under review that could result in significant payments, accruals, or a material deviation from its position. The Company’s tax years since its formation remain subject to possible income tax examinations by its major taxing authorities.

As of June 30, 2023, the Company’s total deferred tax assets were $134.5 million. Management assessed whether it is more-likely-than-not that it will generate sufficient taxable income to realize its deferred income tax assets, including the investment in partnership and net operating loss carryforwards. In making this determination, the Company considered all available positive and negative evidence and made certain assumptions. The Company considered, among other things, the overall business environment, its historical earnings and losses, current industry trends, and its outlook for future years. As of June 30, 2023, the Company recorded a valuation allowance of $3.1 million to offset the deferred tax asset created by the capital loss attributable to the Highlander sale.

On August 16, 2022, the U.S. enacted legislation referred to as the Inflation Reduction Act (“IRA”), which significantly changes U.S. corporate income tax laws and is effective for tax years beginning after December 31, 2022. These changes include, among others, a new 15% corporate alternative minimum tax on adjusted financial statement income of corporations with profits over $1 billion, a 1% excise tax on stock buybacks, and various tax incentives for energy and climate initiatives. The Company evaluated the provisions of the IRA and determined that none of the provisions have a material impact on the Company’s reported results, cash flows or financial position for the current year. The Company will continue to evaluate the impacts of the IRA in future tax years.

9. Stockholders’ Equity

Class A Common Stock

At June 30, 2023, there were 214.4 million shares of Class A Common Stock issued and 188.1 million shares of Class A Common Stock outstanding. The holders of Class A Common Stock and Class B Common Stock vote together as a single class on all matters and are entitled one vote for each share held. There is no cumulative voting with respect to the election of directors, which results in the holders of more than 50% of the Company’s outstanding common shares being able to elect all of the directors, subject to voting obligations under the Stockholder Agreement. In the event of a liquidation, dissolution, or winding up of the Company, the holders of the Class A Common Stock are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of stock, if any, having preference over the common stock. The

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holders of the Class A Common Stock have no preemptive or other subscription rights, and there are no sinking fund provisions applicable to such shares.

Class B Common Stock

At June 30, 2023, there were 21.8 million shares of Class B Common Stock issued and outstanding. Holders of Class B Common Stock vote together as a single class with holders of Class A Common Stock on all matters properly submitted to a vote of the stockholders. The holders of Class B Common Stock generally have the right to exchange all or a portion of their shares of Class B Common Stock, together with an equal number of Magnolia LLC Units, for the same number of shares of Class A Common Stock or, at Magnolia LLC’s option, an equivalent amount of cash. Upon the future redemption or exchange of Magnolia LLC Units held by any holder of Class B Common Stock, a corresponding number of shares of Class B Common Stock held by such holder of Class B Common Stock will be canceled. In the event of a liquidation, dissolution, or winding up of Magnolia LLC, the holders of the Class B Common Stock, through their ownership of Magnolia LLC Units, are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of units of Magnolia LLC, if any, having preference over the common units. The holders of the Class B Common Stock have no preemptive or other subscription rights, and there are no sinking fund provisions applicable to such shares.

Share Repurchases

As of June 30, 2023, the Company’s board of directors had authorized a share repurchase program of up to 30.0 million shares of Class A Common Stock. The program does not require purchases to be made within a particular time frame. The Company had repurchased 25.8 million shares under the program at a cost of $414.0 million and had 4.2 million shares of Class A Common Stock remaining under its share repurchase authorization as of June 30, 2023. On July 31, 2023, the Company’s board of directors increased the share repurchase authorization by an additional 10.0 million shares of Class A Common Stock, which increases total share repurchase authorization to 40.0 million shares.

During the six months ended June 30, 2022, the Company repurchased 0.6 million shares of Class A Common Stock for $11.6 million from EnerVest Energy Institutional Fund XIV-C, L.P. outside of the share repurchase program.

During the six months ended June 30, 2022 Magnolia LLC repurchased and subsequently canceled 5.9 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $138.8 million of cash consideration (the “Class B Common Stock Repurchases”). During the same period, the Magnolia LLC Unit Holders redeemed 14.6 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public.

Magnolia did not receive any proceeds from the sale of shares of Class A Common Stock by the Magnolia LLC Unit Holders. Magnolia funded the Class B Common Stock Repurchases with cash on hand.

Dividends and Distributions

The Company’s board of directors periodically declares dividends payable on issued and outstanding shares of Class A Common Stock, and a corresponding distribution from Magnolia LLC to Magnolia LLC Unit Holders. Dividends in excess of retained earnings are recorded as a reduction of additional paid-in capital and distributions to the Magnolia LLC Unit Holders are recorded as a reduction of noncontrolling interest.

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The following table sets forth information with respect to cash dividends and distributions declared by the Company’s board of directors during the six months ended June 30, 2023 and the year ended December 31, 2022, on its own behalf and in its capacity as the managing member of Magnolia LLC, on issued and outstanding shares of Class A Common Stock and Magnolia LLC Units:

Record Date	Payment Date	Dividend/ Distribution Amount per share (1)		Distributions by Magnolia LLC (2)		Dividends Declared by the Company		Distributions to Magnolia LLC Unit Holders
(In thousands, except per share amounts)
May 11, 2023	June 1, 2023	$	0.115	$	24,627	$	22,117	$	2,510
February 10, 2023	March 1, 2023	$	0.115	$	24,878	$	22,368	$	2,510
November 7, 2022	December 1, 2022	$	0.100	$	21,867	$	18,996	$	2,871
August 12, 2022	September 1, 2022	$	0.100	$	21,983	$	19,112	$	2,871
February 14, 2022	March 1, 2022	$	0.200	$	45,851	$	37,283	$	8,568

(1)    Per share of Class A Common Stock and per Magnolia LLC Unit.

(2)    Reflects total cash dividend and distribution payments made, or to be made, to holders of Class A Common Stock and Magnolia LLC Unit Holders (other than the Company) as of the applicable record date.

Noncontrolling Interest

Noncontrolling interest in Magnolia’s consolidated subsidiaries includes amounts attributable to Magnolia LLC Units that were issued to the Magnolia LLC Unit Holders. The noncontrolling interest percentage is affected by various equity transactions such as issuances and repurchases of Class A Common Stock, the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) for Class A Common Stock, or the cancellation of Class B Common Stock (and corresponding Magnolia LLC Units). As of June 30, 2023, Magnolia owned approximately 89.6% of the interest in Magnolia LLC and the noncontrolling interest was approximately 10.4%.

Highlander was a joint venture whereby MGY Louisiana LLC, a wholly owned subsidiary of Magnolia Operating, held approximately 84.7% of the units of Highlander, with the remaining 15.3% attributable to noncontrolling interest. On May 30, 2023, the Company sold its interest in Highlander and recognized a gain on sale of $3.9 million included within “Other income, net” on the Company’s consolidated statements of operations.

10. Stock Based Compensation

On October 8, 2018, the Company’s board of directors adopted the “Magnolia Oil & Gas Corporation Long Term Incentive Plan” (as amended, the “Plan”), effective as of July 17, 2018. A total of 16.8 million shares of Class A Common Stock have been authorized for issuance under the Plan as of June 30, 2023. The Company grants stock based compensation awards in the form of restricted stock units (“RSU”), performance restricted stock units (“PRSU”), and performance stock units (“PSU”) to eligible employees and directors to enhance the Company and its affiliates’ ability to attract, retain, and motivate persons who make important contributions to the Company and its affiliates by providing these individuals with equity ownership opportunities. Shares issued as a result of awards granted under the Plan are generally new shares of Class A Common Stock.

Stock based compensation expense is recognized net of forfeitures within “General and administrative expenses” and “Lease operating expenses” on the consolidated statements of operations and was $4.1 million and $3.5 million for the three months ended June 30, 2023 and 2022, and $7.9 million and $6.4 million for the six months ended June 30, 2023 and 2022, respectively. The Company has elected to account for forfeitures of awards granted under the Plan as they occur in determining compensation expense.

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The following table presents a summary of Magnolia’s unvested RSU, PRSU, and PSU activity for the three months ended June 30, 2023.

	Restricted Stock Units			Performance Restricted Stock Units			Performance Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at March 31, 2023	1,186,712	$	18.79	946,229	$	13.65	232,700	$	24.69
Granted	63,728	20.31		9,772	21.88		—	—
Vested	(52,409)	19.13		—	—		—	—
Forfeited	(24,624)	17.47		(5,146)	14.14		—	—
Unvested at June 30, 2023	1,173,407	$	18.89	950,855	$	13.73	232,700	$	24.69

The following table presents a summary of Magnolia’s unvested RSU, PRSU, and PSU activity for the six months ended June 30, 2023.

	Restricted Stock Units			Performance Restricted Stock Units			Performance Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at December 31, 2022	911,286	$	12.89	1,257,583	$	13.36	278,486	$	6.14
Granted	679,405	22.81		15,524	22.28		232,700	24.69
Granted for performance multiple(1)	—	—		—	—		12,981	6.14
Vested	(376,625)	11.62		(314,963)	12.62		(291,467)	6.14
Forfeited	(40,659)	17.22		(7,289)	15.16		—	—
Unvested at June 30, 2023	1,173,407	$	18.89	950,855	$	13.73	232,700	$	24.69

(1) Upon completion of the performance period for the PSUs granted in 2020, a performance multiple of 105% was applied to each of the grants resulting in additional grants of PSUs in 2023.

Restricted Stock Units

The Company grants service-based RSU awards to employees, which generally vest ratably over a three-year or four-year service period, and to non-employee directors, which vest in full after one year. Non-employee directors may elect to defer the RSU settlement date. RSUs represent the right to receive shares of Class A Common Stock at the end of the vesting period equal to the number of RSUs that vest. RSUs are subject to restrictions on transfer and are generally subject to a risk of forfeiture if the award recipient ceases to be an employee or director of the Company prior to vesting of the award. Compensation expense for the service-based RSU awards is based upon the grant date market value of the award and such costs are recorded on a straight-line basis over the requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards. The aggregate fair value of RSUs that vested during the six months ended June 30, 2023 and 2022 were $8.3 million and $10.2 million, respectively. Unrecognized compensation expense related to unvested RSUs as of June 30, 2023 was $18.1 million, which the Company expects to recognize over a weighted average period of 2.6 years.

Performance Restricted Stock Units and Performance Stock Units

The Company grants PRSUs to certain employees. Each PRSU represents the contingent right to receive one share of Class A Common Stock once the PRSU is both vested and earned. PRSUs generally vest either ratably over a three-year service period or at the end of a three-year service period, in each case, subject to the recipient’s continued employment or service through each applicable vesting date. Each PRSU is earned based on whether Magnolia’s stock price achieves a target average stock price for any 20 consecutive trading days during the five-year performance period. If PRSUs are not earned by the end of the five-year performance period (“Performance Condition”), the PRSUs will be forfeited and no shares of Class A Common Stock will be issued, even if the vesting conditions have been met. Compensation expense for the PRSU awards is based upon grant date fair market value of the award, calculated using a Monte Carlo simulation, as presented below, and such costs are recorded on a straight-line basis over the requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards, as applicable. The aggregate fair value of PRSU awards that vested during the six months ended June 30, 2023 and 2022 were $7.0 million and $4.8 million. Unrecognized compensation expense related to unvested PRSUs as of June 30, 2023 was $6.1 million, which the Company expects to recognize over a weighted average period of 1.5 years.

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The Company grants PSUs to certain employees. Each PSU, to the extent earned, represents the contingent right to receive one share of Class A Common Stock and the awardee may earn between zero and 150% of the target number of PSUs granted based on the total shareholder return (“TSR”) of the Class A Common Stock relative to the TSR achieved by a specific industry peer group over a three-year performance period, the last day of which is also the vesting date. In addition to the TSR conditions, vesting of the PSUs is subject to the awardee’s continued employment through the date of settlement of the PSUs, which will occur within 60 days following the end of the performance period. The aggregate fair value of PSU awards that vested during the six months ended June 30, 2023 and 2022 were $6.7 million and $5.5 million, respectively. Unrecognized compensation expense related to unvested PSUs as of June 30, 2023 was $5.0 million, which the Company expects to recognize over a weighted average period of 2.6 years.

The Performance Condition for the PRSUs granted in 2022 were met on March 28, 2022, therefore the fair value of the PRSUs granted after the Performance Condition were met were based upon the grant date market value of the award. The fair values of the awards granted prior to the date the Performance Condition was met were determined using a Monte Carlo simulation. The following table summarizes the Monte Carlo simulation assumptions used to calculate the grant date fair value of the PSUs in 2023 and PRSUs in 2022.

	Six Months Ended
PSU and PRSU Grant Date Fair Value Assumptions	June 30, 2023	June 30, 2022
Expected term (in years)	2.88	3.55
Expected volatility	60.80%	59.58%
Risk-free interest rate	4.15%	1.89%
Dividend yield	1.93%	1.97%

.

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11. Earnings Per Share

The Company’s unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are deemed participating securities, and therefore dividends and net income allocated to such awards have been deducted from earnings in computing basic and diluted net income per share under the two-class method. Diluted net income per share attributable to Class A Common Stock is calculated under both the two-class method and the treasury stock method and the more dilutive of the two calculations is presented.

The components of basic and diluted net income per share attributable to Class A Common Stock are as follows:

	Three Months Ended				Six Months Ended
(In thousands, except per share data)	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Basic:
Net income attributable to Class A Common Stock	$	91,492	$	250,583	$	187,826	$	416,622
Less: Dividends and net income allocated to participating securities	1,038		2,373		2,036		3,756
Net income, net of participating securities	$	90,454	$	248,210	$	185,790	$	412,866
Weighted average number of common shares outstanding during the period - basic	189,402		188,146		190,584		185,377
Net income per share of Class A Common Stock - basic	$	0.48	$	1.32	$	0.97	$	2.23
Diluted:
Net income attributable to Class A Common Stock	$	91,492	$	250,583	$	187,826	$	416,622
Less: Dividends and net income allocated to participating securities	1,037		2,367		2,034		3,747
Net income, net of participating securities	$	90,455	$	248,216	$	185,792	$	412,875
Weighted average number of common shares outstanding during the period - basic	189,402		188,146		190,584		185,377
Add: Dilutive effect of stock based compensation and other	165		443		291		517
Weighted average number of common shares outstanding during the period - diluted	189,567		188,589		190,875		185,894
Net income per share of Class A Common Stock - diluted	$	0.48	$	1.32	$	0.97	$	2.22

For the three months ended June 30, 2023 and 2022, the Company excluded 21.8 million and 33.8 million, respectively, of weighted average shares of Class A Common Stock issuable upon the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) as the effect was anti-dilutive. For the six months ended June 30, 2023 and 2022, the Company excluded 21.8 million and 39.0 million, respectively, of weighted average shares of Class A Common Stock issuable upon the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) as the effect was anti-dilutive.

12. Related Party Transactions

As of June 30, 2023, no entity held more than 10% of the Company’s common stock or qualified as a principal owner of the Company, as defined in ASC 850, “Related Party Disclosures.”

13. Subsequent Events

On July 31, 2023, the Company’s board of directors declared a quarterly cash dividend of $0.115 per share of Class A Common Stock, and a cash distribution of $0.115 per Magnolia LLC Unit, payable on September 1, 2023 to shareholders or members of record, as applicable, as of August 10, 2023.

On July 31, 2023, the Company’s board of directors increased the share repurchase authorization by an additional 10.0 million shares of Class A Common Stock, which increases total share repurchase authorization to 40.0 million shares.

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On July 31, 2023, Magnolia closed an acquisition in the Giddings area, outside of the Company’s core development area, for a total cash consideration of approximately $40.0 million, subject to customary closing adjustments.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD-LOOKING STATEMENTS

This report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts included or incorporated by reference in this report, including, without limitation, statements regarding the Company’s future financial position, business strategy, budgets, projected revenues, projected costs, and plans and objectives of management for future operations, are forward-looking statements. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to, the Company’s management. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “could,” “expect,” “intend,” “project,” “estimate,” “anticipate,” “plan,” “believe,” or “continue” or similar terminology. Although Magnolia believes that the expectations reflected in such forward-looking statements are reasonable, the Company can give no assurance that such expectations will prove to have been correct. Important factors that could cause actual results to differ materially from the Company’s expectations include, but are not limited to, Magnolia’s assumptions about:

•legislative, regulatory, or policy changes, including those following the change in presidential administrations;

•the market prices of oil, natural gas, natural gas liquids (“NGLs”), and other products or services;

•the supply and demand for oil, natural gas, NGLs, and other products or services, including impacts of actions taken by OPEC and other state-controlled oil companies;

•production and reserve levels;

•the timing and extent of the Company’s success in discovering, developing, producing and estimating reserves;

•geopolitical and business conditions in key regions of the world;

•drilling risks;

•economic and competitive conditions;

•the availability of capital resources;

•capital expenditures and other contractual obligations;

•weather conditions;

•inflation rates;

•the availability of goods and services;

•cyber attacks;

•the occurrence of property acquisitions or divestitures;

•the integration of acquisitions; and

•the securities or capital markets and related risks such as general credit, liquidity, market, and interest-rate risks.

All of Magnolia’s forward-looking information is subject to risks and uncertainties that could cause actual results to differ materially from the results expected. Although it is not possible to identify all factors, these risks and uncertainties include the risk factors and the timing of any of those risk factors identified in the reports that we have filed and may file with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the period ended December 31, 2022 (the “2022 Form 10-K”).

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Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Company’s unaudited consolidated financial statements and the related notes thereto.

Overview 

Magnolia Oil & Gas Corporation (the “Company” or “Magnolia”) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of oil, natural gas, and NGL reserves that operates in one reportable segment located in the United States. The Company’s oil and natural gas properties are located primarily in Karnes County and the Giddings area in South Texas, where the Company primarily targets the Eagle Ford Shale and the Austin Chalk formations. Magnolia’s objective is to generate stock market value over the long term through consistent organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow. The Company’s allocation of capital prioritizes reinvesting in its business to achieve moderate and predictable annual volume growth, balanced with returning capital to its shareholders through dividends and share repurchases.

Magnolia’s business model prioritizes free cash flow, financial stability, and prudent capital allocation. The Company’s ongoing plan is to spend within cash flow on drilling and completing wells while maintaining low leverage. As of June 30, 2023, Magnolia operated two rigs.

Market Conditions Update

After Magnolia experienced record operating margins during 2022, natural gas and NGL prices have significantly declined and oil prices have weakened, while material and labor costs remained elevated. This has resulted in lower revenue and lower operating margins. As a result, Magnolia took actions to reduce its operating and capital spending to better reflect the current cost and commodity environment for the remainder of the year. The capital spending level is in line with the principles of Magnolia’s business model and is expected to provide the Company more operational and financial flexibility going forward.

Business Overview

As of June 30, 2023, Magnolia’s assets in South Texas included 42,451 gross (22,785 net) acres in the Karnes area, and 645,229 gross (460,182 net) acres in the Giddings area. As of June 30, 2023, Magnolia held an interest in approximately 2,149 gross (1,383 net) wells, with total production of 81.9 thousand and 80.6 thousand barrels of oil equivalent per day for the three and six months ended June 30, 2023.

Magnolia recognized net income attributable to Class A Common Stock of $91.5 million and $187.8 million, or $0.48 and $0.97 per diluted common share, for the three and six months ended June 30, 2023. Magnolia recognized net income of $104.6 million and $211.3 million, which includes a noncontrolling interest of $13.1 million and $23.4 million related to the Magnolia LLC Units (and corresponding shares of Class B Common Stock) held by certain affiliates of EnerVest, for the three and six months ended June 30, 2023.

During the six months ended June 30, 2023, the Company declared cash dividends to holders of its Class A Common Stock totaling $44.5 million.

As of June 30, 2023, the Company’s board of directors had authorized a share repurchase program of up to 30.0 million shares of Class A Common Stock. The program does not require purchases to be made within a particular time frame. The Company had repurchased 25.8 million shares under the program at a cost of $414.0 million and had 4.2 million shares of Class A Common Stock remaining under its share repurchase authorization as of June 30, 2023. On July 31, 2023, the Company’s board of directors increased the share repurchase authorization by an additional 10.0 million shares of Class A Common Stock, which increases total share repurchase authorization to 40.0 million shares.

As of June 30, 2023, Magnolia owned approximately 89.6% of the interest in Magnolia LLC and the noncontrolling interest was approximately 10.4%.

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Results of Operations

Three Months Ended June 30, 2023 Compared to the Three Months Ended June 30, 2022

Oil, Natural Gas and NGL Sales Revenues. The following table provides the components of Magnolia’s revenues for the periods indicated, as well as each period’s respective average realized prices and production volumes. This table shows production on a boe basis in which natural gas is converted to an equivalent barrel of oil based on a ratio of six Mcf to one barrel. This ratio may not be reflective of the current price ratio between the two products.

	Three Months Ended
(In thousands, except per unit data)	June 30, 2023		June 30, 2022
Production:
Oil (MBbls)	3,100		3,019
Natural gas (MMcf)	13,784		12,464
NGLs (MBbls)	2,054		1,656
Total (Mboe)	7,451		6,752
Average daily production:
Oil (Bbls/d)	34,065		33,178
Natural gas (Mcf/d)	151,469		136,966
NGLs (Bbls/d)	22,571		18,194
Total (boe/d)	81,881		74,200
Revenues:
Oil revenues	$	223,147	$	332,791
Natural gas revenues	20,847		85,345
Natural gas liquids revenues	36,297		66,513
Total revenues	$	280,291	$	484,649
Average Price:
Oil (per barrel)	$	71.98	$	110.22
Natural gas (per Mcf)	1.51		6.85
NGLs (per barrel)	17.67		40.17

Oil revenues were 80% and 69% of the Company’s total revenues for the three months ended June 30, 2023 and 2022, respectively. Oil production was 42% and 45% of total production volume for the three months ended June 30, 2023 and 2022, respectively. Oil revenues for the three months ended June 30, 2023 were $109.6 million lower than for the three months ended June 30, 2022. A 35% decrease in average price decreased second quarter 2023 revenues by $115.4 million compared to the same period in the prior year, partially offset by a 3% increase in oil production which increased revenues by $5.8 million.

Natural gas revenues were 7% and 17% of the Company’s total revenues for the three months ended June 30, 2023 and 2022, respectively. Natural gas production was 31% of total production volume for each of the three months ended June 30, 2023 and 2022. Natural gas revenues for the three months ended June 30, 2023 were $64.5 million lower than the three months ended June 30, 2022. A 78% decrease in average price decreased second quarter 2023 revenues by $66.5 million compared to the same period in the prior year, partially offset by an 11% increase in natural gas production which increased revenues by $2.0 million.

NGL revenues were 13% and 14% of the Company’s total revenues for the three months ended June 30, 2023 and 2022, respectively. NGL production was 27% and 24% of total production volume for the three months ended June 30, 2023 and 2022, respectively. NGL revenues for the three months ended June 30, 2023 were $30.2 million lower than the three months ended June 30, 2022. A 56% decrease in average price decreased second quarter 2023 revenues by $37.2 million compared to the same period in the prior year, partially offset by a 24% increase in NGL production which increased revenues by $7.0 million.

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Operating Expenses and Other Income (Expense). The following table summarizes the Company’s operating expenses and other income (expense) for the periods indicated.

	Three Months Ended
(In thousands, except per unit data)	June 30, 2023		June 30, 2022
Operating Expenses:
Lease operating expenses	$	36,796	$	32,604
Gathering, transportation and processing	10,389		16,381
Taxes other than income	15,216		27,411
Exploration expenses	—		3,408
Asset retirement obligations accretion	823		802
Depreciation, depletion and amortization	77,008		57,254
General and administrative expenses	18,726		18,530
Total operating expenses	$	158,958	$	156,390
Other Income (Expense):
Interest expense, net	$	(1,149)	$	(7,017)
Other income, net	9,259		6,538
Total other income (expense), net	$	8,110	$	(479)
Average Operating Costs per boe:
Lease operating expenses	$	4.94	$	4.83
Gathering, transportation and processing	1.39		2.43
Taxes other than income	2.04		4.06
Exploration expenses	—		0.50
Asset retirement obligations accretion	0.11		0.12
Depreciation, depletion and amortization	10.34		8.48
General and administrative expenses	2.51		2.74

Lease operating expenses are costs incurred in the operation of producing properties, including expenses for utilities, direct labor, water disposal, workover rigs, workover expenses, materials, and supplies. Lease operating expenses for the three months ended June 30, 2023 were $4.2 million, or $0.11 per boe, higher compared to the corresponding 2022 period, due to increased activity and an increase in costs, including chemicals, compression, and operating and maintenance costs.

Gathering, transportation and processing costs are costs incurred to deliver oil, natural gas, and NGLs to the market. These expenses can vary based on the volume of oil, natural gas, and NGLs produced as well as the cost of commodity processing. The gathering, transportation and processing costs for the three months ended June 30, 2023 were $6.0 million, or $1.04 per boe, lower than the three months ended June 30, 2022, primarily due to lower natural gas and NGL prices which resulted in lower processing costs.

Taxes other than income is comprised of production, ad valorem, and franchise taxes. These taxes are based on rates primarily established by state and local taxing authorities. Production taxes are based on the market value of production. Ad valorem taxes are based on the fair market value of the mineral interests or business assets. Taxes other than income for the three months ended June 30, 2023 were $12.2 million, or $2.02 per boe, lower compared to the three months ended June 30, 2022, primarily due to a decrease in production taxes as a result of the decrease in oil, natural gas, and NGL revenues.

Exploration expenses are geological and geophysical costs that include seismic surveying costs, costs of expired or abandoned leases, and delay rentals. The exploration expenses for the three months ended June 30, 2023 were $3.4 million, or $0.50 per boe, lower than the three months ended June 30, 2022, due to decreased spending on seismic surveying.

Depreciation, depletion and amortization (“DD&A”) during the three months ended June 30, 2023 was $19.8 million, or $1.86 per boe, higher than the three months ended June 30, 2022 due to increased production and a higher depreciable cost basis.

Interest expense, net, during the three months ended June 30, 2023 was $5.9 million lower than the three months ended June 30, 2022, driven by higher interest income realized during 2023 as a result of higher interest rates.

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Other income, net, during the three months ended June 30, 2023 was $2.7 million higher than the three months ended June 30, 2022, primarily driven by the gain on sale of the Company’s 84.7% interest in Highlander.

Six Months Ended June 30, 2023 Compared to the Six Months Ended June 30, 2022

Oil, Natural Gas and NGL Sales Revenues. The following table provides the components of Magnolia’s revenues for the periods indicated, as well as each period’s respective average realized prices and production volumes. This table shows production on a boe basis in which natural gas is converted to an equivalent barrel of oil based on a ratio of six Mcf to one barrel. This ratio may not be reflective of the current price ratio between the two products.

	Six Months Ended
(In thousands, except per unit data)	June 30, 2023		June 30, 2022
Production:
Oil (MBbls)	6,321		5,835
Natural gas (MMcf)	26,433		24,842
NGLs (MBbls)	3,866		3,242
Total (Mboe)	14,592		13,217
Average daily production:
Oil (Bbls/d)	34,922		32,239
Natural gas (Mcf/d)	146,041		137,247
NGLs (Bbls/d)	21,356		17,911
Total (boe/d)	80,618		73,024
Revenues:
Oil revenues	$	462,269	$	595,459
Natural gas revenues	48,619		141,925
Natural gas liquids revenues	77,786		125,105
Total revenues	$	588,674	$	862,489
Average Price:
Oil (per barrel)	$	73.13	$	102.04
Natural gas (per Mcf)	1.84		5.71
NGLs (per barrel)	20.12		38.59

Oil revenues were 79% and 69% of the Company’s total revenues for the six months ended June 30, 2023 and 2022, respectively. Oil production was 43% and 44% of total production volume for the six months ended June 30, 2023 and 2022, respectively. Oil revenues for the six months ended June 30, 2023 were $133.2 million lower than for the six months ended June 30, 2022. A 28% decrease in average price decreased revenues by $168.7 million during the six months ended June 30, 2023 compared to the same period in the prior year, partially offset by an 8% increase in oil production which increased revenues by $35.5 million.

Natural gas revenues were 8% and 16% of the Company’s total revenues for the six months ended June 30, 2023 and 2022, respectively. Natural gas production was 30% and 31% of total production volume for the six months ended June 30, 2023 and 2022, respectively. Natural gas revenues for the six months ended June 30, 2023 were $93.3 million lower than the six months ended June 30, 2022. A 68% decrease in average price decreased revenues by $96.2 million during the six months ended June 30, 2023 compared to the same period in the prior year, partially offset by a 6% increase in natural gas production which increased revenues by $2.9 million.

NGL revenues were 13% and 15% of the Company’s total revenues for the six months ended June 30, 2023 and 2022, respectively. NGL production was 27% and 25% of total production volume for the six months ended June 30, 2023 and 2022, respectively. NGL revenues for the six months ended June 30, 2023 were $47.3 million lower than the six months ended June 30, 2022. A 48% decrease in average price decreased revenues by $59.9 million during the six months ended June 30, 2023 compared to the same period in the prior year, partially offset by a 19% increase in NGL production which increased revenues by $12.6 million.

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Operating Expenses and Other Income (Expense). The following table summarizes the Company’s operating expenses and other income (expense) for the periods indicated.

	Six Months Ended
(In thousands, except per unit data)	June 30, 2023		June 30, 2022
Operating Expenses:
Lease operating expenses	$	79,167	$	61,348
Gathering, transportation and processing	23,121		32,221
Taxes other than income	34,508		48,293
Exploration expenses	11		8,946
Asset retirement obligations accretion	1,664		1,590
Depreciation, depletion and amortization	147,710		110,360
Impairment of oil and natural gas properties	15,735		—
General and administrative expenses	38,492		35,601
Total operating expenses	$	340,408	$	298,359
Other Income (Expense):
Interest expense, net	$	(662)	$	(16,374)
Other income, net	8,120		6,744
Total other income (expense), net	$	7,458	$	(9,630)
Average Operating Costs per boe:
Lease operating expenses	$	5.43	$	4.64
Gathering, transportation and processing	1.58		2.44
Taxes other than income	2.36		3.65
Exploration expenses	—		0.68
Asset retirement obligations accretion	0.11		0.12
Depreciation, depletion and amortization	10.12		8.35
Impairment of oil and natural gas properties	1.08		—
General and administrative expenses	2.64		2.69

Lease operating expenses for the six months ended June 30, 2023 were $17.8 million, or $0.79 per boe, higher compared to the corresponding 2022 period, due to increased activity, including workover activity, and an increase in costs, including chemicals, compression, and operating and maintenance costs.

Gathering, transportation and processing costs for the six months ended June 30, 2023 were $9.1 million, or $0.86 per boe, lower than the six months ended June 30, 2022, primarily due to lower natural gas and NGL prices which resulted in lower processing costs.

Taxes other than income for the six months ended June 30, 2023 were $13.8 million, or $1.29 per boe, lower compared to the six months ended June 30, 2022, primarily due to a decrease in production taxes as a result of the decrease in oil, natural gas, and NGL revenues.

Exploration expenses for the six months ended June 30, 2023 were $8.9 million, or $0.68 per boe, lower than the six months ended June 30, 2022, due to decreased spending on seismic surveying.

DD&A during the six months ended June 30, 2023 was $37.4 million, or $1.77 per boe, higher than the six months ended June 30, 2022 due to increased production and a higher depreciable cost basis.

During the six months ended June 30, 2023, the Company recognized a $15.7 million proved property impairment related to the Highlander property.

General and administrative expenses during the six months ended June 30, 2023 were $2.9 million higher, but $0.05 per boe lower, than the six months ended June 30, 2022. General and administrative expenses were higher year over year primarily due to higher corporate payroll expenses, but lower on a per boe basis because of increased production.

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Interest expense, net, during the six months ended June 30, 2023 was $15.7 million lower than the six months ended June 30, 2022, driven by higher interest income realized during 2023 as a result of higher interest rates.

Income tax expense. The following table summarizes the Company’s income tax expense for the periods indicated.

	Three Months Ended				Six Months Ended
(In thousands)	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Current income tax expense	$	3,986	$	27,875	$	8,188	$	45,975
Deferred income tax expense	20,861		—		36,264		—
Income tax expense	$	24,847	$	27,875	$	44,452	$	45,975

For the three months ended June 30, 2023, income tax expense was $3.0 million lower than the three months ended June 30, 2022, comprised of movements in both current and deferred income taxes. This was primarily driven by a $23.9 million decrease in current income tax expense due to lower taxable income primarily as a result of the decline in commodity prices. This was partially offset by $20.9 million of deferred income tax expense recognized in 2023 which was not recognized in 2022 due to the existence of a full valuation allowance against net deferred tax assets.

For the six months ended June 30, 2023, income tax expense was $1.5 million lower than the six months ended June 30, 2022, comprised of movements in both current and deferred income taxes. This was primarily driven by a $37.8 million decrease in current income tax expense due to lower taxable income primarily as a result of the decline in commodity prices. This was partially offset by $36.3 million of deferred income tax expense recognized in 2023 which was not recognized in 2022 due to the existence of a full valuation allowance against net deferred tax assets.

As of December 31, 2022, the Company released the valuation allowance against net deferred tax assets. As of June 30, 2023, the Company’s total deferred tax assets were $134.5 million. The Company considered, among other things, the overall business environment, its historical earnings and losses, current industry trends, and its outlook for future years. As of June 30, 2023, the Company assessed the realizability of the deferred tax assets and recorded a valuation allowance of $3.1 million to offset the deferred tax asset created by the capital loss attributable to the Highlander sale. See Note 8— Income Taxes in the Notes to the Company’s consolidated financial statements included in this Quarterly Report on Form 10-Q for further detail.

Liquidity and Capital Resources

Magnolia’s primary source of liquidity and capital has been its cash flows from operations. The Company’s primary uses of cash have been for development of the Company’s oil and natural gas properties, returning capital to shareholders, bolt-on acquisitions of oil and natural gas properties, and general working capital needs.

The Company may also utilize borrowings under other various financing sources available to it, including its RBL Facility and the issuance of equity or debt securities through public offerings or private placements, to fund Magnolia’s acquisitions and long-term liquidity needs. Magnolia’s ability to complete future offerings of equity or debt securities and the timing of these offerings will depend upon various factors, including prevailing market conditions and the Company’s financial condition. The Company anticipates its current cash balance, cash flows from operations, and its available sources of liquidity to be sufficient to meet the Company’s cash requirements.

As of June 30, 2023, the Company had $400.0 million of principal debt related to the 2026 Senior Notes outstanding and no outstanding borrowings related to the RBL Facility. As of June 30, 2023, the Company had $1.1 billion of liquidity comprised of the $450.0 million of borrowing base capacity of the RBL Facility, and $676.6 million of cash and cash equivalents.

Cash and Cash Equivalents

At June 30, 2023, Magnolia had $676.6 million of cash and cash equivalents. The Company’s cash and cash equivalents are maintained with various financial institutions in the United States. Deposits with these institutions may exceed the amount of insurance provided on such deposits. However, the Company regularly monitors the financial stability of such financial institutions and believes that the Company is not exposed to any significant default risk.

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Sources and Uses of Cash and Cash Equivalents

The following table presents the sources and uses of the Company’s cash and cash equivalents for the periods presented:

	Six Months Ended
(In thousands)	June 30, 2023		June 30, 2022
SOURCES OF CASH AND CASH EQUIVALENTS
Net cash provided by operating activities	$	421,596	$	618,004
USES OF CASH AND CASH EQUIVALENTS
Acquisitions	$	(3,357)	$	(4,347)
Additions to oil and natural gas properties	(225,388)		(207,461)
Changes in working capital associated with additions to oil and natural gas properties	(39,424)		25,494
Class A Common Stock repurchases	(94,942)		(92,155)
Class B Common Stock purchases and cancellations	—		(138,753)
Dividends paid	(44,684)		(37,176)
Distributions to noncontrolling interest owners	(5,599)		(16,243)
Other	(7,075)		(12,454)
Net uses of cash and cash equivalents	(420,469)		(483,095)
NET CHANGE IN CASH AND CASH EQUIVALENTS	$	1,127	$	134,909

Sources of Cash and Cash Equivalents

Net Cash Provided by Operating Activities

Operating cash flows are the Company’s primary source of liquidity and are impacted, in the short- and long-term, by oil and natural gas prices. The factors that determine operating cash flows are largely the same as those that affect net earnings, with the exception of certain non-cash expenses such as DD&A, stock based compensation, amortization of deferred financing costs, gain on sale of assets, impairment of oil and natural gas properties, non-cash exploration expenses, asset retirement obligations accretion, and deferred income tax expense.

Net cash provided by operating activities totaled $421.6 million and $618.0 million for the six months ended June 30, 2023 and 2022, respectively. During the six months ended June 30, 2023, cash provided by operating activities was negatively impacted by a decrease in realized oil and natural gas prices and the timing of payments, partially offset by the timing of collections.

Uses of Cash and Cash Equivalents

Acquisitions

The Company made individually insignificant bolt-on acquisitions and purchase price adjustments during each of the six months ended June 30, 2023 and 2022.

Additions to Oil and Natural Gas Properties

The following table sets forth the Company’s capital expenditures for the periods presented:

	Three Months Ended				Six Months Ended
(In thousands)	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Drilling and completion	$	86,106	$	122,018	$	225,837	$	205,375
Leasehold acquisition costs	637		1,213		(449)		2,086
Total capital expenditures	$	86,743	$	123,231	$	225,388	$	207,461

During the second quarter of 2023, Magnolia was running a two-rig program. The number of operated drilling rigs is largely dependent on commodity prices and the Company’s strategy of maintaining spending to accommodate the Company’s business model.

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Capital Requirements

As of June 30, 2023 the Company’s board of directors had authorized a share repurchase program of up to 30.0 million shares of Class A Common Stock. On July 31, 2023, the Company’s board of directors increased the share repurchase authorization by an additional 10.0 million shares of Class A Common Stock, which increases total share repurchase authorization to 40.0 million shares. The program does not require purchases to be made within a particular time frame and whether the Company undertakes these additional repurchases is ultimately subject to numerous considerations, market conditions, and other factors. During the six months ended June 30, 2023 and 2022, the Company repurchased 4.7 million and 3.6 million shares for a total cost of approximately $96.1 million and $81.7 million, respectively.

During the six months ended June 30, 2022, the Company also repurchased 0.6 million shares of Class A Common Stock for $11.6 million from EnerVest Energy Institutional Fund XIV-C, L.P. outside of the share repurchase program.

During the six months ended June 30, 2022, Magnolia LLC repurchased and subsequently canceled 5.9 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $138.8 million of cash consideration, respectively. As of June 30, 2023, Magnolia owned approximately 89.6% of the interest in Magnolia LLC and the noncontrolling interest was approximately 10.4%.

During the six months ended June 30, 2023, the Company declared cash dividends to holders of its Class A Common Stock totaling $44.5 million. During the same time period, cash paid for dividends was $44.7 million, inclusive of dividends on vested non-participating securities. Additionally, $5.0 million was distributed to the Magnolia LLC Unit Holders. During the six months ended June 30, 2022, the Company declared cash dividends to holders of its Class A Common Stock totaling $37.3 million, of which $37.2 million was paid as of June 30, 2022. Additionally, $8.6 million was distributed to the Magnolia LLC Unit Holders. The amount and frequency of future dividends is subject to the discretion of the Company’s board of directors and primarily depends on earnings, capital expenditures, debt covenants, and various other factors.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

For variable rate debt, interest rate changes generally do not affect the fair market value of such debt, but do impact future earnings and cash flows, assuming other factors are held constant. The Company is subject to market risk exposure related to changes in interest rates on borrowings under the RBL Facility. Interest on borrowings under the RBL Facility is based on the SOFR rate or alternative base rate plus an applicable margin. At June 30, 2023, the Company had no borrowings outstanding under the RBL Facility.

Commodity Price Risk

Magnolia’s primary market risk exposure is to the prices it receives for its oil, natural gas, and NGL production. The prices the Company ultimately realizes for its oil, natural gas, and NGLs are based on a number of variables, including prevailing index prices attributable to the Company’s production and certain differentials to those index prices. Pricing for oil, natural gas, and NGLs has historically been volatile and unpredictable, and this volatility is expected to continue in the future. The prices the Company receives for production depend on factors outside of its control, including physical markets, supply and demand, financial markets, and national and international policies. A $1.00 per barrel increase (decrease) in the weighted average oil price for the six months ended June 30, 2023 would have increased (decreased) the Company’s revenues by approximately $12.6 million on an annualized basis and a $0.10 per Mcf increase (decrease) in the weighted average natural gas price for the six months ended June 30, 2023 would have increased (decreased) the Company’s revenues by approximately $5.3 million on an annualized basis.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15(b) under the Exchange Act, Magnolia has evaluated, under the supervision and with the participation of its management, including Magnolia’s principal executive officer and principal financial officer, the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of June 30, 2023. Based on such evaluation, Magnolia’s principal executive officer and principal financial officer have concluded that as of such date, the Company’s disclosure controls and procedures were effective. The Company’s disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by it in reports that it files under the Exchange Act is accumulated and communicated to management, including the Company’s principal executive officer and

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principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure and is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC.

Changes in Internal Control over Financial Reporting

There were no changes in the system of internal control over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act) during the quarter ended June 30, 2023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

See Part I, Item 1, Note 7—Commitments and Contingencies to the consolidated financial statements, which is incorporated herein by reference.

From time to time, the Company is party to certain legal actions and claims arising in the ordinary course of business. While the outcome of these events cannot be predicted with certainty, management does not currently expect these matters to have a materially adverse effect on the financial position or results of operations of the Company.

Item 1A. Risk Factors

Please refer to Part I, Item 1A - Risk Factors of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (“2022 Form 10-K”), and Part I, Item 3 - Quantitative and Qualitative Disclosures About Market Risk of this Quarterly Report on Form 10-Q. Any of these factors could result in a significant or material adverse effect on Magnolia’s business, results of operations, or financial condition. There have been no material changes to the Company’s risk factors since its 2022 Form 10-K. Additional risk factors not presently known to the Company or that the Company currently deems immaterial may also impair its business, results of operations, or financial condition.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table sets forth the Company’s share repurchase activities for each period presented:

Period	Number of Shares of Class A Common Stock Purchased	Average Price Paid per Share	Total Number of Shares of Class A Common Stock Purchased as Part of Publicly Announced Program	Maximum Number of Shares of Class A Common Stock that May Yet Be Purchased Under the Program (1)
January 1, 2023 - March 31, 2023	2,400,000	21.36	2,400,000	6,467,105
April 1, 2023 - April 30, 2023	189,627	21.18	189,627	6,277,478
May 1, 2023 - May 31, 2023	1,262,500	19.57	1,262,500	5,014,978
June 1, 2023 - June 30, 2023	797,873	20.18	797,873	4,217,105
Total	4,650,000	20.66	4,650,000	4,217,105

(1)As of June 30, 2023, the Company’s board of directors had authorized a share repurchase program of up to 30.0 million shares of Class A Common Stock. The program does not require purchases to be made within a particular time frame. On July 31, 2023, the Company’s board of directors increased the share repurchase authorization by an additional 10.0 million shares of Class A Common Stock, which increases total share repurchase authorization to 40.0 million shares.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

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Item 5. Other Information

Trading Arrangements

During the three and six months ended June 30, 2023 no director or officer of Magnolia adopted or terminated any Rule 10b5–1 trading arrangement or any non-Rule 10b5–1 trading arrangement, as each term is defined in Item 408(a) of Regulation S-K.

Adoption of Executive Severance Plan

On July 31, 2023, the Company’s board of directors adopted the Magnolia Oil & Gas Corporation Executive Severance and Change in Control Plan (the “Executive Severance Plan”), effective as of August 1, 2023, covering eligible executives, including the Company’s named executive officers (the “NEOs”), Christopher G. Stavros, President and Chief Executive Officer, Brian M. Corales, Senior Vice President and Chief Financial Officer, Timothy D. Yang, Executive Vice President, General Counsel, Corporate Secretary and Land, and Steve F. Millican, Senior Vice President, Operations. The Executive Severance Plan will be administered by the Compensation Committee of the board of directors.

Upon a termination of a participant’s employment by the Company without Cause or due to the participant’s resignation for Good Reason (each as defined in the Executive Severance Plan) (each, a “Qualifying Termination”), the participant will be eligible to receive, subject to the execution and non-revocation of a release of claims and continued compliance with restrictive covenants, the following: (a) a cash payment equal to the product of (i) 2.0 for Mr. Stavros, or 1.5 for the other NEOs (the “Applicable Severance Multiple”), multiplied by (ii) the sum of the participant’s base salary and total bonus opportunity, payable in a lump sum; (b) a prorated portion of the participant’s total bonus opportunity, payable in a lump sum; (c) payment of any unpaid annual bonus in respect of any completed prior calendar year, payable in a lump sum; (d) during the 24-month period for Mr. Stavros, or the 18-month period for the other NEOs, following termination of employment (the “Applicable Benefit Period”), payment or reimbursement of the participant’s COBRA premiums; and (e) outplacement benefits for up to 18 months.

In the event of a Qualifying Termination during the 24-month period following a Change in Control (as defined in the Executive Severance Plan), (a) the Applicable Severance Multiple and the Applicable Benefit Period will increase accordingly (to 3.0 and 36 months, respectively, for Mr. Stavros, and to 2.5 and 30 months, respectively, for the other NEOs), and (b) any unvested equity awards (i) that are subject to time-based vesting will accelerate and fully vest as of the date of termination, or (ii) that are subject to performance-based vesting will accelerate and vest as of the date of termination based on the greater of target and actual performance measured as of the date of the Change in Control. The Executive Severance Plan provides for a 12-month post-employment non-compete and non-solicit, as well as other customary restrictive covenants.

The foregoing description of the Executive Severance Plan does not purport to be complete and is qualified in its entirety by reference to the Executive Severance Plan, which is attached to this Quarterly Report on Form 10-Q as Exhibit 10.2 and incorporated herein by reference.

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Item 6. Exhibits

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q:

Exhibit Number	Description
3.1*	Second Amended and Restated Certificate of Incorporation of the Company, dated as of July 31, 2018 (incorporated herein by reference to Exhibit 3.1 filed with the Current Report on Form 8-K filed on August 6, 2018 (File No. 001-38083)).
3.2*	Bylaws of the Company (incorporated herein by reference to Exhibit 3.3 filed with the Registration Statement on Form S-1 filed on April 17, 2017 (File No. 333-217338)).
10.1**	Form of 2023 Non-Employee Director Restricted Stock Unit Grant Notice and attached Form of Restricted Stock Unit Agreement under the Magnolia Oil & Gas Corporation Long Term Incentive Plan, as amended.
10.2**	Magnolia Oil & Gas Corporation Executive Severance and Change in Control Plan.
31.1**	Certification of Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2**	Certification of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1***	Certifications Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**	XBRL Instance Document.
101.SCH**	XBRL Taxonomy Extension Schema Document.
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB**	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document.
104**	Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101).

*    Incorporated herein by reference as indicated.

**    Filed herewith.

***    Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	MAGNOLIA OIL & GAS CORPORATION
Date: August 2, 2023	By:	/s/ Christopher Stavros
		Christopher Stavros
		Chief Executive Officer (Principal Executive Officer)

Date: August 2, 2023	By:	/s/ Brian Corales
		Brian Corales
		Chief Financial Officer (Principal Financial Officer)

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EX-10.1

EXHIBIT 10.1

MAGNOLIA OIL & GAS CORPORATION

LONG TERM INCENTIVE PLAN

NON-EMPLOYEE DIRECTOR RESTRICTED STOCK UNIT GRANT NOTICE

Pursuant to the terms and conditions of the Magnolia Oil & Gas Corporation Long Term Incentive Plan, as amended from time to time (the “Plan”), Magnolia Oil & Gas Corporation (the “Company”) hereby grants to the individual listed below (“you” or the “Participant”) the number of Restricted Stock Units (“RSUs”) set forth below in this Restricted Stock Unit Grant Notice (this “Grant Notice”). This award of RSUs (this “Award”) is subject to the terms and conditions set forth herein, in the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “Agreement”), in the Plan attached hereto as Exhibit B and, if timely completed and submitted by you, in the applicable Non-Employee Director Restricted Stock Unit Settlement Election Form (the “Settlement Election Form”), each of which is incorporated herein by reference. Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.

Participant:	[Participant Name]
Date of Grant:	[May 3, 2023]
Total Number of Restricted Stock Units:	[Number of RSUs Granted]
Vesting Commencement Date:	[May 3, 2023] (“Vesting Commencement Date”)
Vesting Schedule:	Subject to the terms and conditions of this Grant Notice, the Agreement, and the Plan, the RSUs shall vest on the earlier to occur of: (i) the day preceding the next annual meeting of stockholders of the Company at which directors are elected or (ii) the first anniversary of the Vesting Commencement Date, in each case, so long as you remain a director or service provider to the Company or an Affiliate, as applicable, from the Date of Grant through such date. Notwithstanding the foregoing, (i) in the event that, in connection with or following a Change in Control, you cease to serve as a director or a service provider to the Company or an Affiliate, the RSUs will vest in full upon such cessation of service, and (ii) in the event of a Change in Control pursuant to which the successor company or a parent or subsidiary thereof does not assume the RSUs, then so long as you have continued to provide services to the Company or an Affiliate, as applicable, from the Date of Grant through the date of such Change in Control, the RSUs will vest in full upon such Change in Control. In accordance with of Section 7(b) the Plan, you may elect to defer settlement of the RSUs until you are no longer a director or service provider to the Company or an Affiliate or the occurrence of a Change in Control. Any deferral election must be made pursuant to a Settlement Election Form in compliance with such rules and procedures as the Committee deems advisable.
Settlement Event:	RSUs that have vested in accordance with the terms of this Grant Notice will be settled on the applicable date as elected by you on a timely submitted Settlement Election Form or, if no such form is timely submitted by you, then on the date of vesting of the RSUs (such date or event, a “Settlement Event”). Absent a provision in the Agreement or the Plan to the contrary, Stock with respect to vested RSUs will be delivered to you within 60 days following the applicable Settlement Event. Regardless of whether you have timely submitted a Settlement Election Form, Dividend Equivalent payments will be paid to you at the time or times set forth in Section 3 of the Agreement.

By clicking to accept, you agree to be bound by the terms and conditions of the Agreement, the Plan, and this Grant Notice. You acknowledge that you have reviewed in their entirety and fully understand all provisions of the Agreement, the Plan, and this Grant Notice. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee regarding any questions or determinations arising under the Agreement, the Plan, or this Grant Notice.

In lieu of receiving documents in paper format, you agree, to the fullest extent permitted by applicable law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this Award. Electronic

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delivery may be via a Company electronic mail system or by reference to a location on a Company intranet to which you have access. You hereby consent to all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents.

You acknowledge and agree that clicking to accept this Award constitutes your electronic signature and is intended to have the same force and effect as your manual signature.

[Remainder of Page Intentionally Blank; Signature Page Follows]

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IN WITNESS WHEREOF, the Company has caused this Grant Notice to be executed by an officer thereunto duly authorized, effective for all purposes as provided above.

MAGNOLIA OIL & GAS CORPORATION

By:

Title: President and Chief Executive Officer

Name: Christopher Stavros

[Signature Page]

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EXHIBIT A

RESTRICTED STOCK UNIT AGREEMENT

This Restricted Stock Unit Agreement (together with the Grant Notice, this “Agreement”) is made as of the Date of Grant set forth in the Grant Notice (the “Date of Grant”) by and between Magnolia Oil & Gas Corporation, a Delaware corporation (the “Company”), and [________________] (the “Participant”). Capitalized terms used but not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice.

1.     Award. For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, effective as of the Date of Grant, the Company hereby grants to the Participant the number of RSUs set forth in the Grant Notice on the terms and conditions set forth in the Grant Notice, this Agreement, and the Plan, which is incorporated herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control. To the extent vested, each RSU represents the right to receive one share of Stock, subject to the terms and conditions set forth in the Grant Notice, this Agreement, and the Plan. Prior to settlement of this Award, the RSUs and this Award represent an unsecured and unfunded obligation of the Company. Consistent with the terms of the Plan, all designations, determinations, interpretations, and other decisions under or with respect to the terms of the Plan or the Agreement shall be within the sole discretion of the Committee and shall be final, conclusive, and binding upon all persons.

2.     Vesting of RSUs.

(a)     The RSUs shall vest in accordance with the vesting schedule and other vesting terms set forth in the Grant Notice. Except in the case of vesting pursuant to a qualifying termination of service as set forth in the Grant Notice, in the event of the termination of the Participant’s service prior to the vesting of all of the RSUs, all unvested RSUs (and all rights arising from such RSUs and from being a holder thereof) will terminate automatically without any further action by the Company and will be forfeited without consideration or notice on the date of such termination.

(b)     Notwithstanding any provision herein to the contrary, in the event of any inconsistency between this Section 2 and any written agreement entered into by and between the Participant and the Company or an Affiliate, as applicable, the terms of such agreement shall control.

3.     Dividend Equivalents. In the event that the Company declares and pays a dividend in respect of its outstanding shares of Stock and, on the record date for such dividend, the Participant holds RSUs granted pursuant to this Agreement that have not been settled or forfeited as of such record date, the Company shall pay dividend equivalents to the Participant in the form of cash in an amount equal to the cash dividends the Participant would have received if the Participant was the holder of record, as of such record date, of the number of shares of Stock related to the portion of the Participant’s RSUs granted pursuant to this Agreement that have not been settled or forfeited as of such record date (the “Dividend Equivalents”), such payment to be made promptly following the date that the Company pays such dividend to its shareholders generally (each, a “Dividend Payment Date”) (however, in no event shall the Dividend Equivalents be paid later than 30 days following the Dividend Payment Date).

4.     Settlement of RSUs. RSUs that have vested in accordance with the terms of the Grant Notice shall be settled within 60 days following the applicable Settlement Event (provided that the Participant shall not be allowed to designate the taxable year of the payment). Pursuant to this Section 4, the Company shall deliver to the Participant a number of shares of Stock equal to the number of vested RSUs. All shares of Stock issued hereunder shall be delivered either by delivering one or more certificates for such shares to the Participant or by entering such shares in book-entry form, as determined by the Committee in its sole discretion. In the event the Participant would otherwise become

A-1

vested in a fractional portion of a RSU (a “Fractional RSU”) based on the vesting terms set forth in the Grant Notice, the Fractional RSU shall instead remain unvested until the final vesting date provided in the Grant Notice; provided, however, that if the Participant would otherwise vest in a subsequent Fractional RSU prior to the final vesting date for the RSUs and such Fractional RSU taken together with a previous Fractional RSU that remained unvested would equal a whole RSU, then such Fractional RSUs shall vest to the extent they equal a whole RSU. Upon the final vesting date, the value of any remaining Fractional RSUs shall be rounded up to the nearest whole RSU. The value of shares of Stock shall not bear any interest owing to the passage of time.

5.     Non-Transferability. None of the RSUs, rights to receive Dividend Equivalents, or any interest or right therein may be sold, pledged, assigned, or transferred in any manner other than by will or the laws of descent and distribution, unless and until the shares of Stock underlying the RSUs have been issued (or, in the case of Dividend Equivalents, the Dividend Equivalents have been paid in cash), and all restrictions applicable to such shares have lapsed. Neither the RSUs nor any interest or right therein shall be liable for the debts, contracts or engagements of the Participant or his or her successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means, whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect against the Company and its Affiliates, except to the extent that such disposition is expressly permitted by the preceding sentence.

6.     Compliance with Applicable Law. Notwithstanding any provision of this Agreement to the contrary, the issuance of shares of Stock hereunder will be subject to compliance with all requirements of applicable law with respect to such securities and with the requirements of any stock exchange or market system upon which the Stock may then be listed. No shares of Stock will be issued hereunder if such issuance would constitute a violation of any applicable law or regulation or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, shares of Stock will not be issued hereunder unless (a) a registration statement under the Securities Act is in effect at the time of such issuance with respect to the shares to be issued, (b) in the opinion of legal counsel to the Company, the shares to be issued are permitted to be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act, or (c) the Company has attained from any regulatory body having jurisdiction the requisite authority, if any, deemed by the Company’s legal counsel to be necessary for the lawful issuance and sale of any shares of Stock hereunder. As a condition to any issuance of Stock hereunder, the Company may require the Participant to satisfy any requirements that may be necessary or appropriate to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect to such compliance.

7.     Rights as a Stockholder. The Participant shall have no rights as a stockholder of the Company with respect to any shares of Stock that may become deliverable hereunder unless and until the Participant has become the holder of record of such shares of Stock, and no adjustments shall be made for dividends in cash or other property, distributions, or other rights in respect of any such shares of Stock, except as otherwise specifically provided for in the Plan or this Agreement.

8.     Full Satisfaction. Any issuance or transfer of shares of Stock or other property to the Participant or the Participant’s legal representative, heir, legatee, or distributee in accordance with this Agreement shall be in full satisfaction of all claims of such person hereunder.

9.     No Right of Continued Board Service or to Awards. Nothing in the adoption of the Plan, nor the grant of the RSUs thereunder pursuant to the Grant Notice and this Agreement, shall confer upon the Participant the right to continued service with the Board or the board of directors of any Affiliates. Nothing in the Plan or in this Agreement shall affect any right which the Company or any of its Affiliates may have to terminate the Board service of the Participant. The grant of the RSUs is a one-

A-2

time benefit and does not create any contractual or other right to receive a grant of Awards or benefits in lieu of Awards in the future.

10.     Agreement to Furnish Information. The Participant agrees to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirement imposed upon the Company by or under any applicable statute or regulation.

11.     Entire Agreement; Amendment. This Agreement, the Grant Notice, the Settlement Election Form (if applicable), and the Plan constitute the entire agreement of the parties with regard to the subject matter hereof, and contain all the covenants, promises, representations, warranties and agreements between the parties with respect to the RSUs granted hereby; provided¸ however, that the terms of this Agreement shall not modify and shall be subject to the terms and conditions of any service, consulting and/or severance agreement between the Company (or an Affiliate or other entity) and the Participant in effect as of the date a determination is to be made under this Agreement. Without limiting the scope of the preceding sentence, except as provided therein, all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect. The Committee may, in its sole discretion, amend this Agreement from time to time in any manner that is not inconsistent with the Plan.

12.     Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to conflicts of law principles thereof.

13.     Successors and Assigns. The Company may assign any of its rights under this Agreement without the Participant’s consent. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein and in the Plan, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the person(s) to whom this Award may be transferred by will or the laws of descent or distribution.

14.     Clawback. Notwithstanding any provision in this Agreement, the Grant Notice, the Settlement Election Form (if applicable), or the Plan to the contrary, to the extent required by (a) applicable law and/or (b) any policy that may be adopted or amended by the Board from time to time, all shares of Stock issued hereunder shall be subject to forfeiture, repurchase, recoupment and/or cancellation to the extent necessary to comply with such law(s) and/or policy.

15.     Severability. If a court of competent jurisdiction determines that any provision of this Agreement (or any portion thereof) is invalid or unenforceable, then the invalidity or unenforceability of such provision (or portion thereof) shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect.

16.     Section 409A. Notwithstanding anything herein or in the Plan to the contrary, the RSUs, any Dividend Equivalents, and all rights related thereto granted pursuant to this Agreement are intended to comply with or be exempt from the applicable requirements of the Nonqualified Deferred Compensation Rules and shall be limited, construed and interpreted in accordance with such intent. Notwithstanding the foregoing, the Company and its Affiliates make no representations that the RSUs, any Dividend Equivalents, and the rights related thereto provided under this Agreement are exempt from or compliant with the Nonqualified Deferred Compensation Rules and in no event shall the Company or any Affiliate be liable for all or any portion of any taxes, penalties, interest, or other expenses that may be incurred by the Participant on account of non-compliance with the Nonqualified Deferred Compensation Rules. The Participant’s service shall terminate on the date that he or she experiences a “separation from service” as defined under the Nonqualified Deferred Compensation Rules.

[Remainder of Page Intentionally Blank]

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EXHIBIT B

MAGNOLIA OIL & GAS CORPORATION LONG TERM INCENTIVE PLAN

[SEE ATTACHED]

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EX-10.2

EXHIBIT 10.2

MAGNOLIA OIL & GAS CORPORATION

EXECUTIVE SEVERANCE AND CHANGE IN CONTROL PLAN

1.Purpose. Magnolia Oil & Gas Corporation, a Delaware corporation (the “Company”), has adopted the Magnolia Oil & Gas Corporation Executive Severance and Change in Control Plan (the “Plan”) to provide severance pay and benefits to Eligible Executives whose employment is terminated under qualifying circumstances on or after August 1, 2023 (the “Effective Date”). The Plan is intended to be maintained primarily for the purpose of providing benefits for a select group of management or highly compensated employees. Capitalized terms that are used but not defined in other sections below will have the meanings ascribed to such terms in Section 15 hereof.

2.Administration of the Plan.

(a)Administration by the Committee. The Committee shall be responsible for the management and control of the operation and the administration of the Plan, including interpretation of the Plan, decisions pertaining to eligibility to participate in the Plan, computation of severance benefits, granting or denial of severance benefit claims and review of claims denials. The Committee has absolute discretion in the exercise of its powers and responsibilities. For this purpose, the Committee’s powers shall include the following authority, in addition to all other powers provided by the Plan:

(i) to make and enforce such rules and regulations as it deems necessary or proper for the efficient administration of the Plan;

(ii) to interpret the Plan, the Committee’s interpretation thereof to be final and conclusive on all persons claiming benefits under the Plan;

(iii) to decide all questions concerning the Plan and the eligibility of any person to participate in the Plan and at what Tier level;

(iv) to make a determination as to the right of any person to a benefit under the Plan (including to determine whether and when there has been a termination of an Eligible Executive’s employment and the cause of such termination);

(v) to appoint such agents, counsel, accountants, consultants, claims administrators and other persons as may be required to assist in administering the Plan (and the Committee hereby appoints (x) the General Counsel of the Company and the most senior Human Resources officer of the Company to assist in performing ministerial and administrative tasks under the Plan, and (y) the most senior Human Resources officer of the Company to serve as claims administrator under the Plan, subject to Section 13 hereof);

(vi) to allocate and delegate its responsibilities under the Plan and to designate other persons to carry out any of its responsibilities under the Plan, any such allocation, delegation or designation to be in writing;

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(vii) to sue or cause suit to be brought in the name of the Plan; and

(viii) to obtain from the Company, its Affiliates and from Eligible Executives such information as is necessary for the proper administration of the Plan.

(b)Indemnification of the Committee. The Company shall, without limiting any rights that the Committee may have under the Company’s charter or bylaws, applicable law or otherwise, indemnify and hold harmless the Committee and each member thereof (and any other individual acting on behalf of the Committee or any member thereof) against any and all expenses and liabilities arising out of such person’s administrative functions or fiduciary responsibilities, excepting only expenses and liabilities arising out of the person’s own gross negligence or willful misconduct. Expenses against which such person shall be indemnified hereunder include the amounts of any settlement, judgment, attorneys’ fees, costs of court, and any other related charges reasonably incurred in connection with a claim, proceeding, settlement, or other action under the Plan.

(c)Compensation and Expenses. The Committee shall not receive additional compensation with respect to services for the Plan. To the extent required by applicable law, but not otherwise, the Committee shall furnish a bond or security for the performance of their duties hereunder. Any expenses properly incurred by the Committee incident to the administration, termination or protection of the Plan, including the cost of furnishing bond, shall be paid by the Company.

3.Eligibility. Only individuals who are Eligible Executives may participate in the Plan. The Committee has full and absolute discretion to determine and select which employees of the Company and its Subsidiaries and Affiliates are Eligible Executives; provided, that, unless expressly determined otherwise by the Committee, upon an individual’s commencement of employment at, or promotion to, an “Executive Position/Level” specified on Exhibit A attached hereto after the Effective Date, such individual’s participation in the Plan at the corresponding “Tier Level” specified on Exhibit A attached hereto shall automatically become effective so long as such individual otherwise qualifies as an Eligible Executive in accordance with the terms and conditions set forth herein (including, without limitation, by executing and delivering a Participation Agreement). Once an employee becomes an Eligible Executive, such individual shall automatically continue to be an Eligible Executive until the Eligible Executive ceases to be an employee or is removed as an Eligible Executive by the Committee; provided, however, that any such change in eligibility will be considered a Plan amendment subject to the restrictions on Plan amendments set forth in Section 14(d) below. The Plan shall supersede all prior agreements, practices, policies, procedures and plans relating to severance payments or benefits from all members of the Company Group with respect to the Eligible Executives (other than with respect to any awards outstanding under the Equity Incentive Plan).

4.Plan Benefits.

(a)Qualifying Termination Outside of a Change in Control Protection Period. In the event an Eligible Executive’s employment with any member of the Company Group is terminated due to a Qualifying Termination that occurs outside of the Change in Control

2

Protection Period, such Eligible Executive shall be entitled to receive the Accrued Amounts, and so long as such Eligible Executive fully satisfies the Release Requirement and abides by the terms of Sections 6, 7, 8, 9 and 10 below, such Eligible Executive shall also be entitled to receive:

(i) A cash payment equal to the product of (A) the Applicable Severance Multiple, multiplied by (B) the sum of such Eligible Executive’s (1) Base Salary and (2) Total Bonus Opportunity, payable in a lump sum as soon as administratively practicable following the date the Release Requirement is fully satisfied; provided, that if the consideration period associated with the Release Requirement (including any revocation period) commences in one calendar year and ends in a second calendar year, such payment shall be made on the later of the first payroll date of the second calendar year or the date the Release Requirement is fully satisfied (including the expiration of any revocation period); provided, further, that in no event shall such payment be made later than seventy-four (74) days after such Date of Termination;

(ii) The Pro-Rated Bonus, payable in a lump sum as soon as administratively practicable following the date the Release Requirement is fully satisfied; provided, that if the consideration period associated with the Release Requirement (including any revocation period) commences in one calendar year and ends in a second calendar year, such payment shall be made on the later of the first payroll date of the second calendar year or the date the Release Requirement is fully satisfied (including the expiration of any revocation period); provided, further, that in no event shall such payment be made later than seventy-four (74) days after such Date of Termination;

(iii)Payment of any annual bonus in respect of any completed calendar year that has not been paid as of the Date of Termination, the amount of which annual bonus, if any, shall be determined by the Committee on a discretionary basis based on the applicable available bonus pool, such Eligible Executive’s bonus goals, and the Company’s performance and such Eligible Executive’s contributions thereto, payable in a lump sum at the same time that any such annual bonuses are paid to similarly-situated employees of the Company Group generally;

(iv) Subject to such Eligible Executive’s timely election of continuation coverage under COBRA or other applicable law, during the Applicable Benefit Period, except to the extent otherwise provided by applicable law, the applicable member of the Company Group shall, at its option, pay or reimburse such Eligible Executive on a monthly basis for the amount such Eligible Executive is required to pay for such Eligible Executive and his or her dependents to effect and continue coverage as contemplated by this Section 4(a)(iv); provided, that if such continued coverage would be discriminatory and would result in the imposition of excise taxes or other liabilities on the Company for failure to comply with any requirements of the Patient Protection and Affordable Care Act of 2010, as amended, the Health Care and Education Reconciliation Act of 2010, as amended (to the extent applicable), or any other applicable law, the Company will provide such Eligible Executive with a cash payment equal to any COBRA premiums, inclusive of any taxes thereon, for the remainder of the Applicable Benefit Period. For the avoidance of doubt, the Applicable Benefit Period shall be

3

deemed to run concurrent with (and shall not extend) the coverage continuation period mandated by COBRA or any other legally mandated and applicable coverage period, and following the Applicable Benefit Period, such Eligible Executive shall be responsible for the full cost associated with any continued coverage, whether under COBRA, any insurance policy conversion rights or otherwise. The Company Group’s obligation to provide continuation coverage under this Plan shall immediately terminate if such Eligible Executive becomes eligible for group medical coverage provided by another employer. Such Eligible Executive shall give prompt notice to the Company if he or she becomes eligible for group medical coverage offered by another employer during the Applicable Benefit Period; and

(v) Payment by the Company of the reasonable fees of an outplacement or similar service provider, selected by the Company in its sole discretion, for up to eighteen (18) months, to assist in finding employment opportunities for such Eligible Executive (the “Outplacement Payment”), payable in accordance with any applicable outplacement policy of the Company as of the Date of Termination.

(b)Qualifying Termination During a Change in Control Protection Period. In the event an Eligible Executive’s employment with any member of the Company Group is terminated due to a Qualifying Termination that occurs during the Change in Control Protection Period, such Eligible Executive shall be entitled to receive the Accrued Amounts, and so long as such Eligible Executive fully satisfies the Release Requirement and abides by the terms of Sections 6, 7, 8, 9 and 10 below, such Eligible Executive shall also be entitled to receive:

(i) A cash payment equal to the product of (A) the Applicable Severance Multiple, multiplied by (B) the sum of such Eligible Executive’s (1) Base Salary and (2) Total Bonus Opportunity, payable in a lump sum as soon as administratively practicable following the date the Release Requirement is fully satisfied; provided, that if the consideration period associated with the Release Requirement (including any revocation period) commences in one calendar year and ends in a second calendar year, such payment shall be made on the later of the first payroll date of the second calendar year or the date the Release Requirement is fully satisfied (including the expiration of any revocation period); provided, further, that in no event shall such payment be made later than seventy-four (74) days after such Date of Termination;

(ii) The Pro-rated Bonus, payable in a lump sum as soon as administratively practicable following the date the Release Requirement is fully satisfied; provided, that if the consideration period associated with the Release Requirement (including any revocation period) commences in one calendar year and ends in a second calendar year, such payment shall be made on the later of the first payroll date of the second calendar year or the date the Release Requirement is fully satisfied (including the expiration of any revocation period); provided, further, that in no event shall such payment be made later than seventy-four (74) days after such Date of Termination;

(iii) Payment of any annual bonus in respect of any completed calendar year that has not been paid as of the Date of Termination, the amount of which annual bonus, if any, shall be determined by the Committee on a discretionary basis based on the applicable available bonus pool, such Eligible Executive’s bonus goals, and the Company’s

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performance and such Eligible Executive’s contributions thereto, payable in a lump sum at the same time that any such annual bonuses are paid to similarly-situated employees of the Company Group generally;

(iv)Subject to such Eligible Executive’s timely election of continuation coverage under COBRA or other applicable law, during the Applicable Benefit Period, except to the extent otherwise provided by applicable law, the applicable member of the Company Group shall, at its option, pay or reimburse such Eligible Executive on a monthly basis for the amount such Eligible Executive is required to pay for such Eligible Executive and his or her dependents to effect and continue coverage as contemplated by this Section 4(b)(iv); provided, that if such continued coverage would be discriminatory and would result in the imposition of excise taxes or other liabilities on the Company for failure to comply with any requirements of the Patient Protection and Affordable Care Act of 2010, as amended, the Health Care and Education Reconciliation Act of 2010, as amended (to the extent applicable), or any other applicable law, the Company will provide such Eligible Executive with a cash payment equal to any COBRA premiums, inclusive of any taxes thereon, for the remainder of the Applicable Benefit Period. For the avoidance of doubt, the Applicable Benefit Period shall be deemed to run concurrent with (and shall not extend) the coverage continuation period mandated by COBRA or any other legally mandated and applicable coverage period, and following the Applicable Benefit Period, such Eligible Executive shall be responsible for the full cost associated with any continued coverage, whether under COBRA, any insurance policy conversion rights or otherwise. The Company Group’s obligation to provide continuation coverage under this Plan shall immediately terminate if such Eligible Executive becomes eligible for group medical coverage provided by another employer. Such Eligible Executive shall give prompt notice to the Company if he or she becomes eligible for group medical coverage offered by another employer during the Applicable Benefit Period;

(v) The Outplacement Payment, payable in accordance with any applicable outplacement policy of the Company as of the Date of Termination; and

(vi) Notwithstanding anything to the contrary set forth in this Plan, the Equity Incentive Plan or the applicable award agreement, in the event an Eligible Executive’s employment with any member of the Company Group is terminated due to a Qualifying Termination that occurs during the Change in Control Protection Period, any outstanding and unvested equity incentive awards held by such Eligible Executive as of such Eligible Executive’s Date of Termination, pursuant to the Equity Incentive Plan or otherwise, (A) that are subject to vesting based on continued employment or service shall fully accelerate and vest as of such Eligible Executive’s Date of Termination, or (B) that are subject to vesting based on performance shall accelerate and vest as of such Eligible Executive’s Date of Termination based on the greater of target and actual performance measured as of the date of such Change in Control, as determined by the Committee in its sole discretion.

(c)Equity Incentive Awards. Except as otherwise expressly provided below and in Section 4(b)(vi) above, in the event that an Eligible Executive’s employment with any member of the Company Group terminates (pursuant to a Qualifying Termination or otherwise),

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all outstanding and unvested equity incentive awards then held by the Eligible Executive, pursuant to the Equity Incentive Plan or otherwise, will be treated in accordance with the award agreement applicable to such award or the Equity Incentive Plan, as applicable. Notwithstanding anything to the contrary set forth in the Equity Incentive Plan or the applicable award agreement, in the event that an Eligible Executive and a member of the Company Group are party to a written agreement that contains a different definition of any of the defined terms in Section 15 hereof, the definition set forth in Section 15 hereof shall be applicable to such Eligible Executive for purposes of this Plan and for purposes of determining the consequences of a termination of employment for purposes of the Equity Incentive Plan and any award agreement and not the definition contained in such written agreement (including, for the avoidance of doubt, prior to, during and following the Change in Control Protection Period).

(d)Non-Qualifying Terminations of Employment. In the event that an Eligible Executive’s employment with any member of the Company Group terminates other than pursuant to a Qualifying Termination, then all compensation and benefits to the Eligible Executive shall terminate contemporaneously with such termination of employment, except that the Eligible Executive shall be entitled to the Accrued Amounts.

(e)After-Acquired Evidence. Notwithstanding any provision of the Plan to the contrary, in the event that the Company determines that an Eligible Executive is eligible to receive the Severance Amount and other severance benefits pursuant to Sections 4(a) or 4(b), as applicable, but, after such determination, the Company subsequently acquires evidence or determines that: (i) the Eligible Executive has failed to abide by the terms of Sections 6, 7, 8, 9 and 10; or (ii) solely with respect to a Qualifying Termination that occurs prior to a Change in Control, a Cause condition existed prior to the Date of Termination that, had the Company been fully aware of such condition, would have given the Company the right to terminate the Eligible Executive’s employment for Cause, then the Company shall have the right to cease the payment of the Severance Amount and to cease providing any other severance benefits under Sections 4(a) or 4(b), as applicable, and the Eligible Executive shall promptly return to the Company any payment of the Severance Amount and any other severance benefits received by the Eligible Executive prior to the date that the Company determines that the conditions of this Section 4(e) have been satisfied.

(f)No Duplication. Except as otherwise expressly provided pursuant to this Plan, this Plan shall be construed and administered in a manner which avoids duplication of compensation and benefits which may be provided under any other plan, program, policy or other arrangement or individual contract or under any statute, rule or regulation. In the event an Eligible Executive is covered by any other plan, program, policy, individually negotiated agreement or other arrangement in effect as of the Eligible Executive’s Date of Termination, that may duplicate the payments and benefits provided for in Sections 4(a) or 4(b), the Committee shall reduce or eliminate the duplicative benefits provided for under the Plan.

5.Certain Excise Taxes. Notwithstanding anything to the contrary in the Plan, if an Eligible Executive is a “disqualified individual” (as defined in Section 280G(c) of the Code), and the payments and benefits provided for in the Plan, together with any other payments and

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benefits which the Eligible Executive has the right to receive from the Company or any of its Affiliates (or any other person who is a party to the transaction constituting a Change in Control), and taking into account reductions in respect of reasonable compensation for personal services to be rendered by the Eligible Executive on or following the date of the relevant “change in ownership or control” (within the meaning of Section 280G of the Code), including pursuant to applicable non-competition and other restrictive covenant obligations, would constitute a “parachute payment” (as defined in Section 280G(b)(2) of the Code), then the payments and benefits provided for in the Plan shall be either (a) reduced (but not below zero) so that the present value of such total amounts and benefits received by the Eligible Executive from the Company and its Affiliates will be one dollar less than three times the Eligible Executive’s “base amount” (as defined in Section 280G(b)(3) of the Code) and so that no portion of such amounts and benefits received by the Eligible Executive shall be subject to the excise tax imposed by Section 4999 of the Code or (b) paid in full, whichever produces the better net after-tax position to the Eligible Executive (taking into account any applicable excise tax under Section 4999 of the Code and any other applicable taxes). The reduction of payments and benefits hereunder, if applicable, shall be made by reducing, first, payments or benefits to be paid in cash hereunder in the order in which such payment or benefit would be paid or provided (beginning with such payment or benefit that would be made last in time and continuing, to the extent necessary, through to such payment or benefit that would be made first in time) and, then, reducing any benefit to be provided in-kind hereunder in a similar order. The determination as to whether any such reduction in the amount of the payments and benefits provided hereunder is necessary shall be made by the Company in good faith. If a reduced payment or benefit is made or provided and through error or otherwise that payment or benefit, when aggregated with other payments and benefits from the Company (or its Affiliates) used in determining if a “parachute payment” exists, exceeds one dollar less than three times the Eligible Executive’s base amount, then the Eligible Executive shall immediately repay such excess to the Company upon notification that an overpayment has been made. Nothing in this Section 5 shall require the Company to be responsible for, or have any liability or obligation with respect to, the Eligible Executives’ excise tax liabilities under Section 4999 of the Code, if any.

6.Confidentiality. During the period in which an Eligible Executive participates in the Plan, as required by the Eligible Executive’s duties on behalf of the Company Group, the Eligible Executive will be provided with, and will have access to, Confidential Information. In consideration of the Eligible Executive’s receipt and access to such Confidential Information, and as a condition of the Eligible Executive’s participation in the Plan, each Eligible Executive shall comply with, and be subject to, the covenants and restrictions in this Section 6 and in Sections 7, 8, 9 and 10.

(a)General. Both during the Eligible Executive’s employment with any member of the Company Group and for five (5) years thereafter, except as expressly permitted by this Plan, the Eligible Executive shall not disclose any Confidential Information to any person or entity and shall not use any Confidential Information except for the benefit of the Company Group; provided, that an Eligible Executive’s obligation to not disclose trade secrets of any member of the Company Group shall extend in perpetuity for so long as they actually remain trade secrets. The Eligible Executive acknowledges and agrees that the Eligible Executive would

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inevitably use and disclose Confidential Information in violation of this Section 6 if the Eligible Executive were to violate any of the covenants set forth in Section 8. The Eligible Executive shall follow all Company Group policies and protocols regarding the security of all documents and other materials containing Confidential Information (regardless of the medium on which Confidential Information is stored). Except to the extent required for the performance of the Eligible Executive’s duties on behalf of the Company Group, the Eligible Executive shall not remove from facilities of any member of the Company Group any information, property, equipment, drawings, notes, reports, manuals, invention records, computer software, customer information, or other data or materials that relate in any way to the Confidential Information, whether paper or electronic and whether produced by the Eligible Executive or obtained by the Company Group. The covenants of this Section 6 shall apply to all Confidential Information, whether now known or later to become known to the Eligible Executive during the period that the Eligible Executive is employed by or affiliated with the Company or any other member of the Company Group.

(b)Permitted Disclosures. Notwithstanding any provision of Section 6(a) to the contrary, the Eligible Executive may make the following disclosures and uses of Confidential Information:

(i)disclosures to other employees, officers or directors of a member of the Company Group who have a need to know the information in connection with the businesses of the Company Group;

(ii)disclosures to customers and suppliers when, in the reasonable and good faith belief of the Eligible Executive, such disclosure is in connection with the Eligible Executive’s performance of the Eligible Executive’s duties for any member of the Company Group and is in the best interests of the Company Group;

(iii)disclosures and uses that are approved in writing by the Board or the Committee; or

(iv)disclosures to a person or entity that has (A) been retained by a member of the Company Group to provide services to one or more members of the Company Group and (B) agreed in writing to abide by the terms of a confidentiality agreement.

(c)Return of Confidential Information. Upon the Date of Termination, and at any other time upon request of the Company, the Eligible Executive shall promptly and permanently surrender and deliver to the Company all documents (including electronically stored information) and all copies thereof and all other materials of any nature containing or pertaining to all Confidential Information and any other Company Group property (including any Company Group-issued computer, mobile device or other equipment) in the Eligible Executive’s possession, custody or control and the Eligible Executive shall not retain any such documents or other materials or property of the Company Group. Within five (5) days of any such request, the Eligible Executive shall certify to the Company in writing that all such documents, materials and property have been returned to the Company.

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(d)Additional Permitted Disclosures. Notwithstanding the foregoing, nothing in this Plan or in any agreement between the Eligible Executive and the Company or any other member of the Company Group shall prohibit or restrict the Eligible Executive from: (i) making any disclosure of relevant and necessary information or documents in any action, investigation, or proceeding as required by law or legal process, including with respect to possible violations of law; (ii) participating, cooperating, or testifying in any action, investigation, or proceeding with, or providing information to, any governmental agency or legislative body, any self-regulatory organization, or pursuant to the Sarbanes-Oxley Act; (iii) accepting any U.S. Securities and Exchange Commission awards; or (iv) initiating communications with, or responding to any inquiry from, any regulatory or supervisory authority regarding any good-faith concerns about possible violations of law or regulation. Pursuant to 18 U.S.C. § 1833(b), the Eligible Executive will not be held criminally or civilly liable under any Federal or state trade secret law for the disclosure of a trade secret of the Company Group that (A) is made (1) in confidence to a Federal, state, or local government official, either directly or indirectly, or to the Eligible Executive’s attorney and (2) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. If the Eligible Executive files a lawsuit for retaliation by a member of the Company Group for reporting a suspected violation of law, the Eligible Executive may disclose the trade secret to the Eligible Executive’s attorney and use the trade secret information in the court proceeding, if the Eligible Executive files any document containing the trade secret under seal, and does not disclose the trade secret, except pursuant to court order. Nothing in this Plan is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by such section.

7.Ownership of Intellectual Property.

(a)Each Eligible Executive agrees that the Company shall own, and the Eligible Executive shall (and hereby does) assign, all right, title and interest relating to any and all Company Intellectual Property, and the Eligible Executive shall promptly disclose all Company Intellectual Property to the Company in writing. To support the Eligible Executive’s disclosure obligation herein, the Eligible Executive shall keep and maintain adequate and current written records of all Company Intellectual Property made by the Eligible Executive (solely or jointly with others) during the period in which the Eligible Executive is or has been employed by or affiliated with the Company or any other member of the Company Group in such form as may be specified from time to time by the Company. These records shall be available to, and remain the sole property of, the Company at all times. For the elimination of doubt, the foregoing ownership and assignment provisions apply without limitation to patent rights, copyrights, trade secret rights, mask work rights, trademark rights, and all other intellectual and industrial property rights of any sort throughout the world.

(b)All of the Eligible Executive’s works of authorship and associated copyrights created during the period in which the Eligible Executive is employed by or affiliated with the Company or any other member of the Company Group and in the scope of the Eligible Executive’s employment or engagement shall be deemed to be “works made for hire” within the meaning of the Copyright Act of 1976, as amended. To the extent any right, title and interest in

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and to Company Intellectual Property cannot be assigned by the Eligible Executive to the Company, the Eligible Executive shall grant, and does hereby grant, to the Company Group an exclusive, perpetual, royalty-free, transferable, irrevocable, worldwide license (with rights to sublicense through multiple tiers of sublicensees) to make, have made, use, sell, offer for sale, import, export, reproduce, practice and otherwise commercialize such rights, title and interest.

(c)The Eligible Executive recognizes that this Plan will not be deemed to require assignment of any invention or intellectual property that the Eligible Executive developed entirely on the Eligible Executive’s own time without using the equipment, supplies, facilities, trade secrets, or Confidential Information of any member of the Company Group. In addition, this Plan does not apply to any invention that qualifies fully for protection from assignment to the Company under any specifically applicable state law or regulation.

(d)To the extent allowed by law, this Section 7(d) applies to all Moral Rights. To the extent the Eligible Executive retains any Moral Rights under applicable law, the Eligible Executive hereby ratifies and consents to any action that may be taken with respect to such Moral Rights by or authorized by the Company or any member of the Company Group, and the Eligible Executive hereby waives and agrees not to assert any Moral Rights with respect to such Moral Rights. The Eligible Executive shall confirm any such ratifications, consents, waivers, and agreements from time to time as requested by the Company.

(e)The Eligible Executive shall perform, during and after the period in which the Eligible Executive is or has been employed by or affiliated with the Company or any other member of the Company Group, all acts reasonably deemed necessary or desirable by the Company to permit and assist each member of the Company Group, at the Company’s expense, in obtaining and enforcing the full benefits, enjoyment, rights and title throughout the world in the Company Intellectual Property and Confidential Information assigned, to be assigned, or licensed to the Company under this Plan. Such acts may include execution of documents and assistance or cooperation (i) in the filing, prosecution, registration, and memorialization of assignment of any applicable patents, copyrights, mask work, or other applications, (ii) in the enforcement of any applicable patents, copyrights, mask work, moral rights, trade secrets, or other proprietary rights, and (iii) in other legal proceedings related to the Company Intellectual Property or Confidential Information.

(f)In the event that the Company (or, as applicable, a member of the Company Group) is unable for any reason to secure the Eligible Executive’s signature to any document required to file, prosecute, register, or memorialize the assignment of any patent, copyright, mask work or other applications or to enforce any patent, copyright, mask work, moral right, trade secret or other proprietary right under any Confidential Information or Company Intellectual Property, the Eligible Executive hereby irrevocably designates and appoints the Company and each of the Company’s duly authorized officers and agents as the Eligible Executive’s agents and attorneys-in-fact to act for and on the Eligible Executive’s behalf and instead of the Eligible Executive, (i) to execute, file, prosecute, register and memorialize the assignment of any such application, (ii) to execute and file any documentation required for such enforcement, and (iii) to do all other lawfully permitted acts to further the filing, prosecution,

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registration, memorialization of assignment, issuance, and enforcement of patents, copyrights, mask works, moral rights, trade secrets or other rights under the Confidential Information or Company Intellectual Property, all with the same legal force and effect as if executed by the Eligible Executive. For the avoidance of doubt, the provisions of this Section 7(f) apply fully to all derivative works, improvements, renewals, extensions, continuations, divisionals, continuations in part, continuing patent applications, reissues, and reexaminations of all Company Intellectual Property.

(g)In the event that the Eligible Executive enters into, on behalf of any member of the Company Group, any contracts or agreements relating to any Confidential Information or Company Intellectual Property, the Eligible Executive shall assign such contracts or agreements to the Company (or the applicable member of the Company Group) promptly, and in any event, prior to the Eligible Executive’s termination of employment. If the Company (or the applicable member of the Company Group) is unable for any reason to secure the Eligible Executive’s signature to any document required to assign said contracts or agreements, or if the Eligible Executive does not assign said contracts or agreements to the Company (or the applicable member of the Company Group) prior to the Eligible Executive’s termination of employment, the Eligible Executive hereby irrevocably designates and appoints the Company (or the applicable member of the Company Group) and each of the Company’s duly authorized officers and agents as the Eligible Executive’s agents and attorneys-in-fact to act for and on the Eligible Executive’s behalf and instead of the Eligible Executive to execute said assignments and to do all other lawfully permitted acts to further the execution of said documents.

8.Non-Competition; Non-Solicitation.

(a)The Company shall provide each Eligible Executive access to Confidential Information for use only during the Eligible Executive’s period of employment with any member of the Company Group, and the Eligible Executive acknowledges and agrees that the Company Group will be entrusting the Eligible Executive, in the Eligible Executive’s unique and special capacity, with developing the goodwill of the Company Group, and in consideration of the Company providing the Eligible Executive with access to Confidential Information, clients and customers, the Eligible Executive voluntarily agrees to the covenants set forth in this Section 8. The Eligible Executive agrees and acknowledges that the limitations and restrictions set forth herein, including geographical and temporal restrictions on certain competitive activities, are reasonable in all respects, do not interfere with public interests, will not cause the Eligible Executive undue hardship, and are material and substantial parts of this Plan intended and necessary to prevent unfair competition and to protect the Company Group’s Confidential Information, goodwill and legitimate business interests.

(b)During the Prohibited Period, the Eligible Executive shall not, without the prior written approval of the Board, directly or indirectly, for the Eligible Executive or on behalf of or in conjunction with any other person or entity of any nature:

(i)engage in or participate in (or prepare to engage in or participate in) the Business within the Market Area, which prohibition shall prevent the Eligible Executive from directly or indirectly: (A) owning, investing in, controlling, managing,

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operating, participating in, lending the Eligible Executive’s name to, contributing to, providing assistance to or being an officer or director of, any person or entity engaged in or planning to engage in the Business in the Market Area, or (B) joining, becoming an employee or consultant of, or otherwise rendering services for or being affiliated with or engaged by, any person or entity engaged in, or planning to engage in, the Business in the Market Area in any capacity (with respect to this clause (B)) in which the Eligible Executive’s duties or responsibilities are materially the same as the duties or responsibilities that the Eligible Executive had on behalf of any member of the Company Group; provided, however, that the purchase of a public security of a corporation engaged in such business or service shall not in itself be deemed a violation of this Section 8 so long as the Eligible Executive does not own, directly or indirectly, more than two percent (2%) of the securities of such corporation;

(ii)appropriate or interfere with or attempt to appropriate or interfere with any Business Opportunity of, or relating to, any member of the Company Group located in the Market Area;

(iii)solicit, canvass, approach, encourage, entice or induce any customer, vendor or supplier of any member of the Company Group with whom the Eligible Executive had contact (including oversight responsibility) or learned Confidential Information about during the Eligible Executive’s employment with any member of the Company Group to cease or lessen such customer’s, vendor’s or supplier’s business with any member of the Company Group or otherwise adversely affect such relationship, or attempt to do any of the foregoing; or

(iv)solicit, canvass, approach, encourage, entice or induce any employee or contractor of any member of the Company Group to terminate his, her or its employment or engagement with any member of the Company Group or otherwise adversely interfere with such relationship.

(c)Because of the difficulty of measuring economic losses to the Company Group as a result of a breach or threatened breach of the covenants set forth in Sections 6, 7, 8, 9 and 10, and because of the immediate and irreparable damage that would be caused to the members of the Company Group for which they would have no other adequate remedy, the Company and each other member of the Company Group shall be entitled to enforce the foregoing covenants, in the event of a breach or threatened breach, by injunctions and restraining orders from any court of competent jurisdiction, without the necessity of showing any actual damages or that money damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned equitable relief shall not be the Company’s or any other member of the Company Group’s exclusive remedy for a breach but instead shall be in addition to all other rights and remedies available to the Company and each other member of the Company Group at law and equity.

(d)The covenants in this Section 8, and each provision and portion hereof, are severable and separate, and the unenforceability of any specific covenant (or portion thereof) shall not affect the provisions of any other covenant (or portion thereof). Moreover, in the event

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any arbitrator or court of competent jurisdiction shall determine that the scope, time or territorial restrictions set forth are unreasonable, then it is the intention of the parties that such restrictions be enforced to the fullest extent which such arbitrator or court deems reasonable.

9.Non-Disparagement. Subject to Section 6(d) above, each Eligible Executive agrees that the Eligible Executive will not, and will cause the Eligible Executive’s affiliates to not, make, publish, or communicate any disparaging or defamatory comments regarding any member of the Company Group or their current or former directors, officers, members, managers, partners, executives or direct or indirect owners (including equityholders).

10.Cooperation. Each Eligible Executive agrees that during the Eligible Executive’s employment with any member of the Company Group and thereafter (regardless of whether the Eligible Executive resigns or the Eligible Executive’s employment is terminated by such member of the Company Group or the reason for such resignation or termination), the Eligible Executive shall provide reasonable and timely cooperation in connection with: (a) any actual or threatened litigation, inquiry, review, investigation, process, or other matter, action, or proceeding (whether conducted by or before any court, regulatory, or governmental entity, or by or on behalf of the Company Group, or otherwise), that relates to events occurring during the Eligible Executive’s employment by any member of the Company Group or about which the Company Group otherwise believes the Eligible Executive may have relevant information; (b) the transitioning of the Eligible Executive’s role and responsibilities to other personnel; and (c) the provision of information in response to the Company Group’s requests and inquiries in connection with the Eligible Executive’s separation of employment. Each Eligible Executive’s cooperation shall include being available, at reasonable and mutually agreed times and locations (when possible), to (i) meet with and provide information to the Company Group and its counsel or other agents in connection with fact-finding, investigatory, discovery, and/or pre-litigation or other proceeding issues, at the Company’s expense, and (ii) provide truthful testimony (including via affidavit, deposition, at trial, or otherwise) in connection with any such matter, all without the requirement of being subpoenaed.

11.Prior Obligations. Each Eligible Executive hereby represents and warrants that the Eligible Executive is not the subject of, or a party to, any non-competition, non-solicitation, restrictive covenant or non-disclosure agreement, or any other agreement, obligation, restriction or understanding that would prohibit the Eligible Executive from complying with the Plan or fully performing each of the Eligible Executive’s duties and responsibilities for the Company Group, or would in any manner, directly or indirectly, limit or affect any of the duties and responsibilities that may now or in the future be assigned to the Eligible Executive by any member of the Company Group. Each Eligible Executive expressly acknowledges and agrees that the Eligible Executive is strictly prohibited from using or disclosing any confidential information belonging to any prior employer in the course of performing services for any member of the Company Group, and the Eligible Executive promises that the Eligible Executive shall not do so. Each Eligible Executive shall not introduce documents or other materials containing confidential information of any prior employer to the premises or property (including computers and computer systems) of any member of the Company Group.

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12.Consent to Notification. If an Eligible Executive ceases to be employed by any member of the Company Group, the Eligible Executive hereby grants consent to notification by the Company Group to any new employer, any third party engaging the Eligible Executive’s services, or any entity to which the Eligible Executive becomes a partner, member, employee or otherwise engaged about the Eligible Executive’s rights and obligations under the Plan.

13.Claims Procedure and Review. Any claim for Plan benefits shall be made in accordance with this Section 13.

(a)Filing a Claim. Any Eligible Executive that the Committee determines is entitled to severance benefits under the Plan is not required to file a claim for benefits. The Committee shall inform any Eligible Executive upon such Eligible Executive’s Qualifying Termination that such Eligible Executive will be eligible for benefits under this Plan, so long as the Eligible Executive satisfies the conditions set forth in Section 4 of this Plan. Any Eligible Executive (i) who is not paid severance benefits hereunder and who believes that such Eligible Executive is entitled to severance benefits hereunder or (ii) who has been paid severance benefits hereunder and believes that such Eligible Executive is entitled to greater benefits hereunder may file a claim for severance benefits under the Plan in writing with the Committee within ninety (90) days after such Eligible Executive’s Date of Termination.

(b)Initial Determination of a Claim. If a claim for severance benefits hereunder has been properly filed, the Committee shall evaluate it and notify the claimant of the approval, whole denial or partial denial of the claim, within a reasonable period of time but no later than ninety (90) days after receipt of the claim (or one-hundred and eighty (180) days after receipt of the claim if special circumstances require an extension of time for processing the claim). If a claim for severance benefits hereunder is wholly or partially denied, such notice shall (i) be in writing, (ii) be written in a manner calculated to be understood by the claimant, (iii) contain the specific reason or reasons for denial of the claim, (iv) refer specifically to the pertinent Plan provisions upon which the denial is based, (v) describe any additional material or information necessary for the claimant to perfect the claim (and explain why such material or information is necessary), and (vi) explain the claimant’s right to appeal the claim and describe the Plan’s claim appeal procedures and time limits applicable to such procedures, including a statement of the claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review.

(c)Appeal of a Denied Claim. Within sixty (60) days of the receipt by the claimant of this notice of denial or partial denial, the claimant may file a written appeal with the Committee. In connection with the appeal, the claimant may review Plan documents and may submit written issues and comments. The claimant may also submit issues, arguments and other comments in writing to the Committee, along with any documentary evidence to support their claim. The Committee shall deliver to the claimant a written decision on the appeal promptly, but not later than sixty (60) days after the receipt of the claimant’s appeal (or one-hundred and twenty (120) days after receipt of the claimant’s appeal if there are special circumstances which require an extension of time for processing). Such decision shall (i) be in writing, (ii) be written in a manner calculated to be understood by the claimant, (iii) include specific reasons for the

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decision, (iv) refer specifically to the Plan provisions upon which the decision is based, (v) state that the claimant is entitled to receive, on request and free of charge, reasonable access to and copies of all documents, records, and other information relevant to the claimant’s claim for benefits, and (vi) a statement of the claimant’s right to bring an action under Section 502(a) of ERISA.

(d)Special Circumstances. If special circumstances require an extension of up to one-hundred and eighty (180) days for an initial claim or one-hundred and twenty (120) days for an appeal, whichever applies, the Committee shall send written notice of the extension within ninety (90) days after receipt of the initial claim and within sixty (60) days after receipt of an appeal. This notice shall indicate the special circumstances requiring the extension and state when the Committee expects to render the decision.

(e)Claims Limitation Period. Claimants must follow the claims and appeals procedures detailed in this Section 13 before taking legal action or any action in any other form regarding claims for Plan benefits. If the claimant has completed the entire above claims procedure, and said claimant disagrees with the Committee’s final decision, the claimant may commence a civil court action under ERISA Section 502(a). Subject to this Section 13, the claimant shall be required to commence any such civil action in the federal courts of Harris County within one (1) year of the Committee’s final decision, and the claimant hereby consents to the exclusive jurisdiction of such courts for these purposes. If the claimant does not commence a civil action in such courts and within the claim’s limitation period described in the immediately preceding sentence, the claimant waives all rights to relief under ERISA. A claimant shall have no right to seek review of a denial of Plan benefits, or to bring any legal action or proceeding to enforce a claim, prior to filing a claim and exhausting his or her administrative remedies under this Section 13.

(f)Compliance with ERISA. The benefits claim procedure provided in this Section 13 is intended to comply with the provisions of 29 C.F.R. §2560.503-1 and ERISA Section 503. All provisions of this Section 13 shall be interpreted, construed, and limited in accordance with such intent.

14.General Provisions.

(a)Taxes. The Company is authorized to withhold from all payments made hereunder amounts of withholding and other taxes due or potentially payable in connection therewith, and to take such other action as the Company may deem advisable to enable the Company and the Eligible Executive to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any payments made under the Plan.

(b)No Mitigation. No Eligible Executive shall have any duty to mitigate the amounts payable under the Plan by seeking or accepting new employment or self-employment following a Qualifying Termination.

(c)Offset. The Company may set off against, and each Eligible Executive authorizes the Company to deduct from, any payments due to the Eligible Executive, or to his or

15

her estate, heirs, legal representatives, or successors, any amounts which may be due and owing to the Company or an Affiliate of the Company by the Eligible Executive, whether arising under the Plan or otherwise; provided, however, that no such offset may be made with respect to amounts payable that are subject to the requirements of Section 409A unless the offset would not result in a violation of the requirements of Section 409A.

(d)Amendment and Termination. The Plan may be amended or terminated by the Board or the Committee from time to time in its discretion and for any reason or no reason; provided, that during the Change in Control Protection Period, no amendment or termination of the Plan shall impair any rights or obligations to any Eligible Executive under the Plan unless the Eligible Executive expressly consents to such amendment or termination. Notwithstanding the foregoing, the Board or the Committee is required to provide written notice of any amendment to any Eligible Executives who are then participating in the Plan at least eighteen (18) months prior to the effective date of such amendment, and in the event that a Change in Control occurs during such eighteen (18)-month period, then upon any Qualifying Termination following such Change in Control and during the Change in Control Protection Period that follows, such Eligible Executive shall be entitled to receive the greater level of severance benefits provided for under the amended Plan or the Plan prior to such amendment.

(e)Successors. The Plan will be binding upon any successor to the Company, its assets, its businesses or its interest (whether as a result of the occurrence of a Change in Control or otherwise), in the same manner and to the same extent that the Company would be obligated under the Plan if no succession had taken place. All payments and benefits that become due to an Eligible Executive under the Plan will inure to the benefit of his or her beneficiaries, executors, heirs, assigns, designees or legal representatives.

(f)Transfer and Assignment. Neither an Eligible Executive nor any other person shall have any right to sell, assign, transfer, pledge, anticipate or otherwise encumber, transfer, hypothecate or convey any amounts payable under the Plan prior to the date that such amounts are paid.

(g)Unfunded Obligation. All benefits due an Eligible Executive under the Plan are unfunded and unsecured and are payable out of the general assets of the Company. The Company is not required to segregate any monies or other assets from its general funds with respect to these obligations. Eligible Executives shall not have any preference or security interest in any assets of the Company other than as a general unsecured creditor.

(h)Severability. If any provision of the Plan (or portion thereof) is held to be illegal or invalid for any reason, the illegality or invalidity of such provision (or portion thereof) will not affect the remaining provisions (or portions thereof) of the Plan, but such provision (or portion thereof) will be fully severable and the Plan will be construed and enforced as if the illegal or invalid provision (or portion thereof) had never been included herein.

(i)Section 409A. The Plan is intended to comply with Section 409A or an exemption thereunder and shall be construed and administered in accordance with Section 409A. Notwithstanding any other provision of the Plan, payments provided under the Plan may only be

16

made upon an event and in a manner that complies with Section 409A or an applicable exemption. Any payments under the Plan that may be excluded from Section 409A either as separation pay due to an involuntary separation from service or as a short-term deferral shall be excluded from Section 409A to the maximum extent possible. Any payments to be made under the Plan upon the termination of an Eligible Executive’s employment shall only be made if such termination of employment constitutes a “separation from service” under Section 409A. In no event may an Eligible Executive, directly or indirectly, designate the calendar year of any payment under this Plan. Each installment payment under the Plan is intended to be a separate payment for purposes of Section 409A. Notwithstanding any provision in the Plan to the contrary, if any payment or benefit provided for herein would be subject to additional taxes and interest under Section 409A if an Eligible Executive’s receipt of such payment or benefit is not delayed until the earlier of (i) the date of the Eligible Executive’s death or (ii) the date that is six months after the Eligible Executive’s Date of Termination (such earlier date, the “Section 409A Payment Date”), then such payment or benefit shall not be provided to the Eligible Executive (or the Eligible Executive’s estate, if applicable) until the Section 409A Payment Date. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under the Plan are exempt from, or compliant with, Section 409A and in no event shall the Company or any of its Affiliates be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by any Eligible Executive on account of non-compliance with Section 409A.

(j)Governing Law. All questions arising with respect to the provisions of the Plan and payments due hereunder will be determined by application of the laws of the State of Texas, without giving effect to any conflict of law provisions thereof, except to the extent preempted by federal law.

(k)Status. The Company intends that the Plan constitute an unfunded “employee welfare benefit plan” as such term is defined under ERISA for the benefit of a select group of management and highly compensated employees. No Eligible Executive, employee of the Company or any other person shall have any rights to or interest in any specific assets or accounts of the Company or any of its Affiliates by reason of the Plan.

(l)Third-Party Beneficiaries. Each member of the Company Group shall be a third-party beneficiary of the Eligible Executive’s covenants and obligations under Sections 6, 7, 8, 9 and 10 and shall be entitled to enforce such obligations.

(m)No Right to Continued Employment. The adoption and maintenance of the Plan shall not be deemed to be a contract of employment between the Company or any of its Affiliates and any person, or to have any impact whatsoever on the at-will employment relationship between the Company or any of its Affiliates and the Eligible Executives. Nothing in the Plan shall be deemed to give any person the right to be retained in the employ of the Company or any of its Affiliates for any period of time or to restrict the right of the Company or any of its Affiliates to terminate the employment of any person at any time.

(n)Title and Headings; Construction. Titles and headings to Sections hereof are for the purpose of reference only and shall in no way limit, define or otherwise affect the

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provisions hereof. Unless the context requires otherwise, all references herein to laws, regulations, contracts, documents, agreements and instruments refer to such laws, regulations, contracts, documents, agreements and instruments as they may be amended from time to time, and references to particular provisions of laws or regulations include a reference to the corresponding provisions of any succeeding law or regulation. The word “or” as used herein is not exclusive and is deemed to have the meaning “and/or.” The words “herein”, “hereof”, “hereunder” and other compounds of the word “here” shall refer to the entire Plan, and not to any particular provision hereof. Wherever the context so requires, the masculine gender includes the feminine or neuter, and the singular number includes the plural and conversely. The use herein of the word “including” following any general statement, term or matter shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation”, “but not limited to”, or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term or matter. Neither the Plan nor any uncertainty or ambiguity herein shall be construed or resolved against any party hereto, whether under any rule of construction or otherwise. On the contrary, the Plan has been reviewed by each of the parties hereto and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of the parties hereto.

(o)Overpayment. If, due to mistake or any other reason, a person receives severance payments or benefits under the Plan in excess of what the Plan provides, such person shall repay the overpayment to the Company in a lump sum within thirty (30) days of notice of the amount of overpayment. If such person fails to so repay the overpayment, then without limiting any other remedies available to the Company, the Company may deduct the amount of the overpayment from any other amounts which become payable to such person under the Plan or otherwise.

(p)Clawback. Notwithstanding anything in this Plan or any other agreement between the Company and/or its related entities and an Eligible Executive to the contrary, the Eligible Executive acknowledges and agrees that any amounts payable under the Plan to the Eligible Executive are subject to (i) any right that the Company may have under any policy or other agreement or arrangement with the Eligible Executive (whether in existence as of the Effective Date or later adopted) established by the Company providing for clawback or recovery of amounts that were paid to the Eligible Executive, and (ii) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission, the listing standards of any national securities exchange or association on which the Company’s securities are listed, or any other applicable law. The Company will make any determination for clawback or recovery in its sole discretion and in accordance with applicable laws, regulations, and securities exchange listing standards.

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(q)Agent for Service of Legal Process. Legal process may be served on the Committee, which is the plan administrator, at the following address: Nine Greenway Plaza, Suite 1300, Houston, Texas 77046.

15.Definitions. For purposes of the Plan, the following terms shall have the respective meanings set forth below:

(a)“Accrued Amounts” means (i) all unpaid Base Salary and/or other earned wages accrued through the Date of Termination, which shall be paid on the Company’s first regularly scheduled pay date following the Date of Termination (or earlier if required by applicable law); (ii) reimbursement for all incurred but unreimbursed expenses for which an Eligible Executive is entitled to reimbursement in accordance with the expense reimbursement policies of the Company in effect as of the Date of Termination; and (iii) benefits to which an Eligible Executive may be entitled pursuant to the terms of any plan or policy sponsored by the Company or any of its Affiliates as in effect from time to time.

(b)“Affiliate” means with respect to any person, any other person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with, the person in question. As used herein, the term “control” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through ownership of voting securities, by contract or otherwise.

(c)“Applicable Benefit Period” means, for each Eligible Executive, the period beginning on the first day of the first month that commences following the Eligible Executive’s Date of Termination and extending for the number of months corresponding to such Eligible Executive’s Tier, as set forth on Exhibit A attached hereto.

(d)“Applicable Severance Multiplier” means, for each Eligible Executive, the applicable multiple corresponding to such Eligible Executive’s Tier, as set forth on Exhibit A attached hereto.

(e)“Base Salary” means the amount an Eligible Executive is entitled to receive as base salary on an annualized basis, in effect as of the Date of Termination, excluding all annual cash incentive awards, bonuses, equity awards, and incentive compensation payable by the Company or any of its Affiliates as consideration for an Eligible Executive’s services. Notwithstanding the foregoing, in the event of a reduction in an Eligible Executive’s Base Salary resulting in the Eligible Executive’s resignation for Good Reason, for purposes of determining the Eligible Executive’s Severance Amount, the Eligible Executive’s Base Salary shall be deemed to be that in effect immediately prior to such reduction.

(f)“Board” means the Board of Directors of the Company.

(g)“Business” means the business and operations that are materially the same as those performed by the Company and any other member of the Company Group for which an Eligible Executive provides services or about which such Eligible Executive obtains Confidential Information during such Eligible Executive’s employment with any member of the Company

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Group, which business and operations include the acquisition, development, exploration, and production of oil, natural gas, and natural gas liquid reserves.

(h)“Business Opportunity”means any actual or potential commercial, investment or other business opportunity of any member of the Company Group or relating to the Business about which an Eligible Executive learned Confidential Information during such Eligible Executive’s employment with any member of the Company Group.

(i)“Cause” means (i) an Eligible Executive’s material breach of this Plan, of any other written agreement between an Eligible Executive and the Company or an Affiliate, or of any material policy or code of conduct established by the Company or an Affiliate and applicable to an Eligible Executive; (ii) the commission of a material act of gross negligence, willful misconduct, breach of fiduciary duty, fraud, theft or embezzlement on the part of the Eligible Executive upon the Company; (iii) the conviction of the Eligible Executive for, or plea of nolo contendere by the Eligible Executive to, any felony (or state law equivalent) or any crime involving moral turpitude; or (iv) the Eligible Executive’s willful failure or refusal, other than due to Disability, to perform the Eligible Executive’s obligations pursuant to this Plan or any employment agreement with the Company or an Affiliate, as applicable, or to follow any lawful directive from the Company or any Affiliate, as determined by the Company; provided, however, that if the Eligible Executive’s actions or omissions as set forth in this clause (iv) are of such a nature that the Company determines they are curable by the Eligible Executive, such actions or omissions must remain uncured thirty (30) days after the Company has provided the Eligible Executive written notice of the obligation to cure such actions or omissions.

(j)“Change in Control” means the occurrence of any of the following events after the Effective Date:

(i) The consummation of an agreement to acquire or a tender offer for beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) by any Person, of fifty percent (50%) or more of either (x) the then outstanding shares of Stock (the “Outstanding Stock”) or (y) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this Section 15(j)(i), the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any entity controlled by the Company or (D) any acquisition by any entity pursuant to a transaction that complies with Sections 15(j)(iii)(A), (B) and (C) below;

(ii) Individuals who constitute the Incumbent Board cease for any reason to constitute at least a majority of the Board;

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company or an acquisition of assets of another entity (a “Business Combination”), in each case, unless, following such Business Combination, (A) the Outstanding Stock and Outstanding Company Voting Securities

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immediately prior to such Business Combination represent or are converted into or exchanged for securities which represent or are convertible into more than sixty percent (60%) of, respectively, the then outstanding shares of common stock or common equity interests and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors or other governing body, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity which as a result of such transaction owns the Company, or all or substantially all of the Company’s assets either directly or through one or more subsidiaries), (B) no Person (excluding any employee benefit plan (or related trust) of the Company or the entity resulting from such Business Combination) beneficially owns, directly or indirectly, twenty percent (20%) or more of, respectively, the then outstanding shares of common stock or common equity interests of the entity resulting from such Business Combination or the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors or other governing body of such entity to the extent that such ownership results solely from ownership of the Company that existed prior to the Business Combination, and (C) at least a majority of the members of the board of directors or similar governing body of the entity resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination. For the avoidance of doubt, in no event shall a series of unrelated transactions collectively constitute a Change in Control whether or not such transactions would otherwise constitute Business Combinations for this purpose; or

(iv) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

Notwithstanding the foregoing, for purposes of any payment made to an Eligible Executive under this Plan that is characterized as “nonqualified deferred compensation” within the meaning of Section 409A, to the extent the impact of a Change in Control on such payment would subject the Eligible Executive to additional taxes under Section 409A, a Change in Control for purposes of such payment will mean both a Change in Control and a “change in the ownership of a corporation,” “change in the effective control of a corporation,” or a “change in the ownership of a substantial portion of a corporation’s assets” within the meaning of Section 409A as applied to the Company.

(k)“Change in Control Protection Period” means the twenty-four (24)-month period beginning immediately prior to the consummation of a Change in Control.

(l)“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

(m)“Code” means the Internal Revenue Code of 1986, as amended.

(n)“Committee” means the Compensation Committee of the Board or such other committee duly authorized by the Board to manage and control the operation and administration of the Plan. To the extent the Board elects to administer the Plan or if no

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committee is duly authorized by the Board to administer this Plan, the term “Committee” shall be deemed to refer to the Board for all purposes under this Plan.

(o)“Company Group” means the Company and each of its direct and indirect Subsidiaries and Affiliates.

(p)“Company Intellectual Property” means any and all inventions (whether or not patentable), discoveries, developments, improvements, innovations, works of authorship, mask works, designs, know-how, ideas, formulae, processes, techniques, data and information authored, created, contributed to, made or conceived or reduced to practice, in whole or in part, by an Eligible Executive during the period in which such Eligible Executive is or has been employed by or affiliated with the Company or any other member of the Company Group, whether or not registerable under U.S. law or the laws of other jurisdictions, that either (i) relate, at the time of conception, reduction to practice, creation, derivation or development, to any member of the Company Group’s businesses or actual or anticipated research or development, or (ii) were developed on any amount of the Company’s or any other member of the Company Group’s time or with the use of any member of the Company Group’s equipment, supplies, facilities or Confidential Information.

(q)“Confidential Information” means all confidential, competitively valuable, non-public or proprietary information that is conceived, made, developed or acquired by or disclosed to an Eligible Executive (whether conveyed orally or in writing), individually or in conjunction with others, during the period that such Eligible Executive is employed by or otherwise affiliated with the Company or any other member of the Company Group (whether during business hours or otherwise and whether on the Company’s premises or otherwise) including: (i) technical information of any member of the Company Group, its investors, customers, vendors, suppliers or other third parties, including computer programs, software, databases, data, ideas, know-how, formulae, compositions, processes, discoveries, machines, inventions (whether patentable or not), designs, developmental or experimental work, techniques, improvements, work in process, research or test results, original works of authorship, training programs and procedures, diagrams, charts, business and product development plans, and similar items; (ii) information relating to any member of the Company Group’s businesses or properties, products or services (including all such information relating to corporate opportunities, operations, future plans, methods of doing business, business plans, strategies for developing business and market share, research, financial and sales data, pricing terms, evaluations, opinions, interpretations, acquisition prospects, the identity of customers or acquisition targets or their requirements, the identity of key contacts within customers’ organizations or within the organization of acquisition prospects, or marketing and merchandising techniques, prospective names and marks) or pursuant to which any member of the Company Group owes a confidentiality obligation; and (iii) other valuable, confidential information and trade secrets of any member of the Company Group, its customers or other third parties. Moreover, all documents, videotapes, written presentations, brochures, drawings, memoranda, notes, records, files, correspondence, manuals, models, specifications, computer programs, e-mail, voice mail, electronic databases, maps, drawings, architectural renditions, models and all other writings or materials of any type including or embodying any of such

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information, ideas, concepts, improvements, discoveries, inventions and other similar forms of expression are and shall be the sole and exclusive property of the Company or the other applicable member of the Company Group and be subject to the same restrictions on disclosure applicable to all Confidential Information pursuant to this Plan. For purposes of this Plan, Confidential Information shall not include any information that (A) is or becomes generally available to the public other than as a result of a disclosure or wrongful act of such Eligible Executive or any of such Eligible Executive’s agents; (B) was available to such Eligible Executive on a non-confidential basis before its disclosure by a member of the Company Group; (C) becomes available to such Eligible Executive on a non-confidential basis from a source other than a member of the Company Group; provided, however, that such source is not bound by a confidentiality agreement with, or other obligation with respect to confidentiality to, a member of the Company Group; or (D) is required to be disclosed by applicable law.

(r)“Date of Termination” means the effective date of the termination of an Eligible Executive’s employment with the Company or any other member of the Company Group, as applicable, as designated by the Committee (or, in the case of a termination for Good Reason, the resignation date designated by the Eligible Executive within the applicable time period specified in Section 15(x)), such that the Eligible Executive is no longer employed by any member of the Company Group as of such designated date.

(s)“Disability” means (i) a physical or mental impairment of sufficient severity such that (x) an Eligible Executive is unable to continue performing the duties assigned to the Eligible Executive prior to such impairment, or (y) the Eligible Executive’s condition entitles the Eligible Executive to disability benefits under any insurance or employee benefit plan of the Company or its Affiliates, and (ii) the impairment or condition is cited by the Company as the reason for the Eligible Executive’s termination; provided, that, in all cases, the term Disability shall be applied and interpreted in compliance with Section 409A.

(t)“Eligible Executive” means any active, regular full-time employee of any member of the Company Group who (i) is serving in an “Executive Position/Level” specified on Exhibit A attached hereto as of the Effective Date or, following the Effective Date, commences employment at, or is promoted to, such an “Executive Position/Level”; (ii) has executed and returned a Participation Agreement to the Company; (iii) is not covered under any other severance plan, policy, program or arrangement sponsored or maintained by any member of the Company Group (other than with respect to any awards outstanding under the Equity Incentive Plan), including, without limitation, the Magnolia Oil & Gas Corporation Employee Severance Plan (the “Employee Plan”); and (iv) is not a party to an employment or severance agreement with any member of the Company Group pursuant to which such employee is eligible for severance payments or benefits. The Committee shall have the sole discretion to determine whether an employee is an Eligible Executive. Notwithstanding anything to the contrary set forth herein, Eligible Executives shall be limited to a select group of management or highly compensated employees within the meaning of Sections 201, 301 and 401 of ERISA. For the avoidance of doubt, any individual who would be deemed an Eligible Executive under the Plan except for such individual’s failure to execute and deliver a Participation Agreement in accordance with the terms and conditions set forth herein shall be deemed an Eligible Employee

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(as defined in the Employee Plan) for all purposes under the Employee Plan; provided, that such individual satisfies all of the applicable requirements set forth in the Employee Plan and does not subsequently participate in the Plan.

(u)“Equity Incentive Plan” means the Magnolia Oil & Gas Corporation Long Term Incentive Plan, as may be amended, restated or otherwise modified from time to time, or any successor equity incentive plan established by the Company.

(v)“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

(w)“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, including the guidance, rules and regulations promulgated thereunder and successor provisions, guidance, rules and regulations thereto.

(x)“Good Reason” means an Eligible Executive’s resignation within one hundred and twenty days (120) days after any of the following events, unless the Eligible Executive consents to the applicable event: (i) a material decrease in the Eligible Executive’s base salary, other than a reduction in annual base salary of less than ten percent (10%) that is implemented in connection with a contemporaneous reduction in annual base salaries affecting other similarly-situated employees of the Company; (ii) following the occurrence of a Change in Control, a material reduction in the aggregate amount of compensation opportunity and benefits provided to the Eligible Executive or in the level of the Eligible Executive’s participation relative to other similarly-situated participants; (iii) a material decrease in (a) the Eligible Executive’s then-current title or position, or (b) authority or areas of responsibility as are commensurate with the Eligible Executive’s then-current title or position; (iv) a relocation of the Eligible Executive’s principal work location to a location more than fifty (50) miles from the Eligible Executive’s then-current principal location of employment; or (v) a material breach by the Company or any Subsidiary or Affiliate of any provision of this Plan or any material agreement between the Eligible Executive, the Company or any Subsidiary or Affiliate. Notwithstanding the foregoing, any assertion by the Eligible Executive of a termination for Good Reason will not be effective unless and until the Eligible Executive has: (x) provided the Company, within sixty (60) days of the Eligible Executive’s knowledge of the occurrence of the facts and circumstances underlying the Good Reason event, written notice stating with specificity the applicable facts and circumstances underlying such Good Reason event; and (y) provided the Company or any Subsidiary or Affiliate with an opportunity to cure the same within thirty (30) days after the receipt of such notice.

(y)“Incumbent Board” means the portion of the Board constituted of the individuals who are members of the Board as of the Effective Date and any other individual who becomes a director of the Company after the Effective Date and whose election or appointment by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least a majority of the directors then comprising the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other

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actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Incumbent Board.

(z)“Market Area” means the geographic area within a twenty-five (25)-mile radius of any location where, as of the Date of Termination, any member of the Company Group conducts the Business or has taken substantial preparatory steps to conduct the Business and about which such Eligible Executive had direct or indirect responsibility or received Confidential Information during such Eligible Executive’s final two (2) years of employment with any member of the Company Group.

(aa)“Moral Rights” means any and all rights that may be known as or referred to as “moral rights,” “artist’s rights,” “droit moral,” or the like, including without limitation those rights set forth in 17 U.S.C. §106A.

(ab)“Participation Agreement” means the participation agreement delivered to each Eligible Executive by the Company prior to the Eligible Executive’s entry into the Plan evidencing the Eligible Executive’s agreement to participate in the Plan and to comply with all terms, conditions and restrictions within the Plan, in substantially the form set forth on Exhibit B attached hereto.

(ac)“Person” has the meaning ascribed to such term in the Equity Incentive Plan.

(ad)“Prohibited Period” means the period during which an Eligible Executive is employed by any member of the Company Group and continuing through the date that is twelve (12) months following such Eligible Executive’s Date of Termination, regardless of the reason for such termination of employment.

(ae)“Pro-Rated Bonus” means a pro-rated portion of the Eligible Executive’s Total Bonus Opportunity, determined based on the number of days that such Eligible Executive was employed by any member of the Company Group during the calendar year in which the Date of Termination occurs.

(af)“Qualifying Termination” means the termination of an Eligible Executive’s employment (i) by any member of the Company Group without Cause (which, for the avoidance of doubt, does not include a termination due to death or Disability); provided, that such Eligible Executive remains an employee in good standing with the applicable member of the Company Group through the Date of Termination; or (ii) due to an Eligible Executive’s resignation for Good Reason.

(ag)“Release Requirement” means the requirement that an Eligible Executive (or his or her beneficiary or executor, in the case of the Eligible Executive’s death) execute and deliver to the Company a general release of claims, in substantially the form set forth on Exhibit C attached hereto, on or prior to the date that is twenty-one (21) days following the date upon which the Company delivers the release to the Eligible Executive (which shall occur no later than seven (7) days following the Date of Termination) or, in the event that such termination of

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employment is “in connection with an exit incentive or other employment termination program” (as such phrase is defined in the Age Discrimination in Employment Act of 1967, as amended), the date that is forty-five (45) days following such delivery date. Notwithstanding the foregoing or any other provision in the Plan to the contrary, the Release Requirement shall not be considered satisfied if the release described in the preceding sentence is (i) executed by the Eligible Executive (or his or her beneficiary or executor, if applicable) before the close of business on the Date of Termination, or (ii) revoked by the Eligible Executive (or his or her beneficiary or executor, as applicable) within any time provided by the Company for such revocation.

(ah)“Section 409A” means Section 409A of the Code and the Department of Treasury regulations and other interpretive guidance issued thereunder, including any such regulations or guidance that may be amended or issued after the Effective Date.

(ai)“Severance Amount” means the cash severance payments set forth in Sections 4(a)(i) or 4(b)(i), as applicable.

(aj)“Stock” has the meaning ascribed to such term in the Equity Incentive Plan.

(ak)“Subsidiary” means any subsidiary corporation of the Company within the meaning of Section 424(f) of the Code.

(al)“Total Bonus Opportunity” means the dollar amount equal to (i) an Eligible Executive’s annual bonus maximum goal percentage for the calendar year that includes the Eligible Executive’s Date of Termination, multiplied by (ii) such Eligible Executive’s Base Salary as of the Date of Termination (determined without giving effect to any reduction that constituted the basis for a termination for Good Reason pursuant to this Plan).

(am)“Tier” means the “Tier Level” used for purposes of determining the level of severance benefits an Eligible Executive is eligible to receive, as specified on Exhibit A attached hereto. The level of severance payments and benefits an Eligible Executive shall be eligible to receive under this Plan shall depend upon such Eligible Executive’s corresponding “Executive Position/Level” at the time a Qualifying Termination occurs, as specified on Exhibit A attached hereto. Notwithstanding the foregoing, in the event of a material decrease in an Eligible Executive’s title or position resulting in the Eligible Executive’s resignation for Good Reason in accordance with Section 15(x)(iii)(a) hereof, for purposes of determining such Eligible Executive’s Tier, such Eligible Executive’s Tier shall be deemed to be the Tier in effect immediately prior to such decrease.

Notwithstanding anything to the contrary contained herein, in the event that an Eligible Executive and a member of the Company Group are party to a written agreement that contains a different definition of any of the defined terms in this Section 15, the definition set forth in this Section 15 shall be applicable to such Eligible Executive for purposes of this Plan and not the definition contained in such written agreement (including, for the avoidance of doubt, prior to, during and following the Change in Control Protection Period).

26

Exhibit A

Applicable Severance Multiple and Applicable Benefit Period

Qualifying Termination Outside of a Change in Control Protection Period

Tier Level	Executive Position/ Level	Applicable Severance Multiple	Applicable Benefit Period
Tier 1	[●]	[●]	[●]
Tier 2	[●]	[●]	[●]
Tier 3	[●]	[●]	[●]

Qualifying Termination During a Change in Control Protection Period

Tier Level	Executive Position/ Level	Applicable Severance Multiple	Applicable Benefit Period
Tier 1	[●]	[●]	[●]
Tier 2	[●]	[●]	[●]
Tier 3	[●]	[●]	[●]

27

Exhibit B

Participation Agreement

[DATE]

Re: Participation Agreement – Magnolia Oil & Gas Corporation Executive Severance and Change in Control Plan

Dear [NAME]:

We are pleased to inform you that you are eligible to participate in the Magnolia Oil & Gas Corporation Executive Severance and Change in Control Plan (as it may be amended from time to time, the “Plan”). Your participation in the Plan is subject to your execution and delivery of this agreement, which constitutes a Participation Agreement, and to the terms and conditions of the Plan, which is incorporated herein and deemed to be part of this Participation Agreement for all purposes. Unless otherwise defined herein, capitalized terms used in this Participation Agreement shall have the meanings set forth in the Plan.

As [TITLE] of the Company, you are eligible to receive Tier [●] severance payments and benefits under the Plan, subject to your execution and delivery of this Participation Agreement and the terms and conditions of the Plan, unless and until your position with the Company changes such that you occupy a different “Executive Position/Level” as specified on Exhibit A attached to the Plan (in which case, for the avoidance of doubt, your Tier level shall automatically be modified to reflect such change in position).

In signing below, you expressly agree to be bound by, and promise to abide by, the terms of Sections 6, 7, 8, 9 and 10 of the Plan, which create certain obligations and restrictions with respect to confidentiality, non-competition, non-solicitation, ownership of intellectual property, non-disparagement and post-termination cooperation. You agree that the covenants within Sections 6, 7, 8, 9 and 10 of the Plan are reasonable in all respects.

You acknowledge and agree that the Plan and this Participation Agreement supersede all prior severance benefit policies, plans, agreements and arrangements of the Company or any other member of the Company Group (and supersede all prior oral or written communications by the Company or any of other member of the Company Group with respect to severance benefits) (other than with respect to any awards outstanding under the Equity Incentive Plan), and all such prior policies, plans, arrangements and communications are hereby null and void and of no further force and effect, solely with respect to your severance entitlements set forth therein.

You further acknowledge and agree that (i) you have fully read, understand and voluntarily enter into this Participation Agreement and (ii) you have had a sufficient opportunity to consult with your personal tax, financial planning advisor and attorney about the tax, financial and legal consequences of your participation in the Plan before signing this Participation Agreement.

28

This Participation Agreement may be executed in separate counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. Please execute this Participation Agreement in the space provided below and send a fully executed copy to [NAME] no later than [DATE].

Sincerely,

MAGNOLIA OIL & GAS CORPORATION

By:    

Name:

Title:

AGREED AND ACCEPTED

[NAME]

29

Exhibit C

Separation Agreement and General Release

This Separation Agreement and General Release of Claims (this “Release” or “Agreement”) is entered into by and between [NAME] (“Employee”) and Magnolia Oil & Gas Corporation, a Delaware corporation (the “Company”).

WHEREAS:

(i)Employee has been employed by the Company;

(ii)Employee’s employment has been terminated as of the Separation Date, as defined below; and

(iii)In connection with Employee’s termination of employment, Employee is eligible to receive certain severance payments and benefits pursuant to the Company’s Executive Severance and Change in Control Plan, effective as of [DATE] (the “Plan”) and Employee’s Participation Agreement entered into under the Plan, dated as of [DATE] (the “Participation Agreement”), subject to the terms and conditions set forth therein including the Release Requirement (as defined in the Plan).

NOW THEREFORE, the Company and Employee agree as follows:

1.Separation Date.Employee’s employment with the Company was or will be permanently terminated on [DATE] (the “Separation Date”).

2.Release of Claims.Employee, for and in consideration of the promises of the Company set forth in this Agreement, and intending to be legally bound hereby, does hereby REMISE, RELEASE AND FOREVER DISCHARGE the Company and its past, present, and future parent organizations, divisions, subsidiaries, affiliates, related entities, successors, predecessors and assigns and its and their respective directors, partners, officers, shareholders, employees, agents, attorneys, representatives, predecessors, successors, and assigns (“Releasees”), from all claims, actions, causes of action, suits, debts, charges, complaints, demands, losses, liabilities and obligations of any nature whatsoever, that Employee ever had, now has, or hereafter may have, whether known or unknown, asserted or unasserted, in law or in equity, from the beginning of Employee’s employment with the Company through the date that Employee executes this Agreement (“Claims”).

This general release includes any Claims arising out of any foreign, federal, state or local statutes, regulations, ordinances or common law, and whether based on contract, tort, or statute or any other legal or equitable theory of recovery, including but not limited to claims arising under Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1866, the Civil Rights Act of 1991, the federal Age Discrimination in Employment Act of 1967, the federal Equal Pay Act, the United States Constitution, the federal Employee Retirement Income Security Act, the federal Older Workers Benefit Protection Act, the federal Americans With Disabilities Act, the federal Family and Medical Leave Act, Executive Orders 11246 and 11141, the Worker Adjustment Retraining and Notification Act, the Genetic Information and Non-Discrimination Act, the National Labor Relations Act, the Uniformed Services Employment and Reemployment Rights Act, or the Occupational Safety and Health Act, [INSERT SPECIFIC STATE LAWS AS APPLICABLE] and any other federal, state or local law or ordinances, or any common law claim

D-1

under tort, contract or any other theories now or hereafter recognized. The general release recited in this paragraph shall include any and all Claims which Employee may have for any type of damages cognizable under any laws, including, but not limited to, any and all claims for compensatory damages, punitive damages, and attorneys’ fees and costs. Employee also agrees that this general release should be interpreted as broadly as possible to achieve Employee’s intention to waive all of Employee’s Claims against the Releasees.

3.Claims Not Released.Notwithstanding the above, pursuant to this Release, Employee is not waiving claims for benefits filed under any state workers’ compensation or unemployment law or challenges to the validity of this Agreement under the Older Workers Benefits Protection Act. Employee is also not waiving any claim for pension benefits, which may arise in the future; claims to any benefit entitlements vested as of the Separation Date, pursuant to written terms of any Company employee benefit plan; Employee’s right to payment and benefits under the Plan that are contingent upon the execution by Employee of this Release; and Employee’s existing rights, if any, as an equity holder under any operating agreement, stockholders’ agreement or similar agreement of the Company and any vested rights under any equity compensation plans, agreements or arrangements sponsored or maintained by the Company.

4.Agreement Not to Sue.Employee expressly represents that Employee has not filed a lawsuit or initiated any other administrative proceedings against the Releasees, and that Employee has not assigned any claim against the Releasees to any other person or entity. Employee further promises not to initiate a lawsuit against the Releasees relating to any Claim arising prior to the date of Employee’s execution of this Agreement, except that nothing in this Agreement shall bar Employee’s right to file an administrative charge with the Securities and Exchange Commission (“SEC”), the Equal Employment Opportunity Commission (“EEOC”), the United States Department of Labor (“DOL”), the National Labor Relations Board (“NLRB”), or any other federal, state or local agency; prevent Employee from reporting to any government agency any concerns Employee may have regarding the Company’s practices; or preclude Employee’s participation in an investigation by the SEC, EEOC, DOL, NLRB or any other federal, state or local agency. Should any entity, agency, commission, or person file a charge, action, complaint or lawsuit against the Releasees based upon any of the above-released Claims, Employee agrees that this Agreement bars Employee’s right, to the extent permitted by law, to recover any relief whatsoever (including monetary relief), except that Employee may receive an award from the SEC under the federal securities laws.

5.Satisfaction of All Leaves and Payment Amounts; Prior Rights and Obligations. In entering into this Agreement, Employee expressly acknowledges and agrees that Employee has received all leaves (paid and unpaid) to which Employee was entitled during Employee’s employment with the Company and Employee has received, other than the severance payments and benefits set forth in the Plan and the Participation Agreement, all wages, bonuses and other compensation, been provided all benefits and been afforded all rights and been paid all sums that Employee is owed or has been owed by the Company or any other Releasee, including all payments arising out of all incentive plans and any other bonus arrangements. For the avoidance of doubt, Employee acknowledges and agrees that Employee had no right to the severance payments and benefits set forth in the Plan and Participation Agreement (or any portion thereof) but for Employee’s entry into this Agreement.

6.No Admission of Liability. Employee agrees and understands that the execution of this Agreement shall not constitute or be construed as an admission by the Company of any liability to, or of the validity of any Claim whatsoever by Employee. The Company specifically

2

denies any liability to Employee on the part of itself, its directors, officers, agents, employees and representatives.

7.Protected Disclosures. Notwithstanding anything to the contrary contained herein, however, no provision of this Release shall be interpreted so as to impede Employee (or any other individual) from reporting possible violations of federal law or regulation to any governmental agency or entity, including but not limited to the Department of Justice, the Securities and Exchange Commission, the Congress, and any agency Inspector General, or making other disclosures under the whistleblower provisions of federal law or regulation. Employee does not need the prior authorization of the Company or the Company’s legal department to make any such reports or disclosures and Employee shall not be required to notify the Company that such reports or disclosures have been made.

8.Continued Effectiveness of Restrictive Covenants. Employee acknowledges that Employee has made certain commitments with respect to non-disclosure of information, non-competition, non-solicitation, non-disparagement and assignment of invention, as set forth in the Plan (the “Restrictive Covenants”). Employee acknowledges that during Employee’s employment with the Company, Employee has received Confidential Information (as defined in the Plan). In entering this Agreement, Employee acknowledges the validity, continued effectiveness and enforceability of the Restrictive Covenants, and expressly reaffirms Employee’s commitment to abide by the Restrictive Covenants.

9.Confidentiality. Employee agrees that the terms and conditions of this Agreement shall remain confidential between the parties, and Employee shall not disclose them to any person outside of Employee’s immediate family, tax advisor, or attorney after first obtaining that individual’s agreement to keep the information confidential and not disclose it to others, unless pursuant to a valid subpoena. If Employee breaches this confidentiality provision, Employee agrees that the Company shall have the right to seek an injunction and/or damages, and if Employee is found by a court to be in breach or responsible for a breach of this provision, Employee agrees that s/he will be liable to the Company for actual damages and remedies that the Company may recover by law.

10.Return of Property. Employee represents and warrants that Employee has returned to the Company all property belonging to the Company or any other Releasee including all computer files, electronically stored information and other materials provided to Employee by the Company or any other Releasee in the course of Employee’s employment and Employee further represents and warrants that Employee has not maintained a copy of any such materials in any form.

11.Successors and Assigns; Third-Party Beneficiaries.This Release is binding upon and shall inure to the benefit of (a) the parties hereto and their respective heirs, executors, administrators, personal or legal representatives, successors and assigns; and (b) each Releasee, as Employee expressly acknowledges and agrees that each Releasee that is not a signatory hereto shall be a third-party beneficiary of Employee’s representations, promises, warranties and releases set forth in this Release.

12.Waiver. If a party, by its actions or omissions, waives or is adjudged to have waived any breach of this Release, any such waiver shall not operate as a waiver of any other subsequent breach of this Release.

3

13.Severability. If any provision of this Release is or shall be declared invalid or unenforceable by a court of competent jurisdiction, the remaining provisions shall not be affected thereby and shall remain in full force and effect.

14.Choice of Law. This Agreement and the rights and obligations hereunder shall be governed by, and construed and interpreted in all respects in accordance with, the laws of the State of Texas, without regard to conflict of law principles.

15.Time to Consider. Employee acknowledges that Employee has been provided with [[a reasonable period of time] // [at least twenty-one (21) calendar days] // [at least forty-five (45) calendar days]] (the “Review Period”) to consider the offer of this Release prior to entering into it. Any modifications made to this Release, whether material or not, shall not extend or re-start the Review Period. Employee agrees to notify the Company of acceptance of this Release by delivering a signed copy of the Release to the Company, to [NAME], [TITLE], at [EMAIL], within the Review Period. Employee understands that the entire Review Period may be taken to consider this Agreement. Employee may execute and return this Release in less than the full Review Period, but not before Employee’s Separation Date. By signing and returning this Release, Employee acknowledges that the Review Period afforded Employee was a reasonable period of time to consider fully each and every term of this Release, including the general release set forth in Paragraph 2.

16.Revocation Right. Employee acknowledges that Employee shall have seven (7) calendar days after signing this Release to revoke this Release. If Employee elects to revoke this Release, written notice of such revocation must be delivered to [NAME] at the Company at the addresses above in such a manner that it is actually received by him/her within the seven (7) calendar-day period.

17.Advice of Counsel. Employee is advised to consult with legal counsel of Employee’s choosing, at Employee’s own expense, regarding the meaning and binding effect of this Release prior to executing it.

18.Counterparts. This Release may be signed in counterparts and each signed counterpart shall have the same full force and effect as if it were fully executed by all parties.

EMPLOYEE EXPRESSLY ACKNOWLEDGES THAT EMPLOYEE HAS READ THE FOREGOING, THAT EMPLOYEE HAS HAD SUFFICIENT TIME TO REVIEW IT WITH AN ATTORNEY OF EMPLOYEE’S CHOOSING, THAT EMPLOYEE UNDERSTANDS THE RELEASES TERMS AND CONDITIONS AND THAT EMPLOYEE INTENDS TO BE LEGALLY BOUND BY IT.

4

IN WITNESS THEREOF, the parties have executed this Release as of the date(s) set forth beneath their signatures below.

DO NOT SIGN THIS RELEASE BEFORE THE CLOSE OF BUSINESS ON THE SEPARATION DATE SET FORTH ABOVE.

EMPLOYEE Signed:     Name:     Date:     MAGNOLIA OIL & GAS CORPORATION Signed:     Name:     Title:      Date:    

5

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Christopher Stavros, Chief Executive Officer of Magnolia Oil & Gas Corporation, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Magnolia Oil & Gas Corporation (the "registrant");

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 2, 2023	By:	/s/ Christopher Stavros
		Christopher Stavros
		Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Brian Corales, Chief Financial Officer of Magnolia Oil & Gas Corporation, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Magnolia Oil & Gas Corporation (the "registrant");

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.    The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 2, 2023	By:	/s/ Brian Corales
		Brian Corales
		Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Magnolia Oil & Gas Corporation (the “Company”) on Form 10-Q for the period ended June 30, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Christopher Stavros and Brian Corales, Principal Executive Officer and Principal Financial Officer, respectively, of the Company, certify, in the capacity and on the date indicated below, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)    The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)    The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 2, 2023	By:	/s/ Christopher Stavros
		Christopher Stavros
		Chief Executive Officer (Principal Executive Officer )

Date: August 2, 2023	By:	/s/ Brian Corales
		Brian Corales
		Chief Financial Officer (Principal Financial Officer)

XML

Cover - shares	6 Months Ended
	Jun. 30, 2023	Jul. 31, 2023
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	001-38083
Entity Registrant Name	Magnolia Oil & Gas Corp
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	81-5365682
Entity Address, Address Line One	Nine Greenway Plaza, Suite 1300
Entity Address, City or Town	Houston,
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77046
City Area Code	713
Local Phone Number	842-9050
Title of 12(b) Security	Class A Common Stock, par value $0.0001
Trading Symbol	MGY
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001698990
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Amendment Flag	false
Class A Common Stock
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		187,903,674
Class B Common Stock
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		21,826,805

XML

Consolidated Balance Sheets - USD ($) shares in Thousands, $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
CURRENT ASSETS
Cash and cash equivalents	$ 676,568	$ 675,441
Accounts receivable	137,379	170,770
Drilling advances	12	3,484
Other current assets	881	1,052
Total current assets	814,840	850,747
PROPERTY, PLANT AND EQUIPMENT
Oil and natural gas properties	3,114,361	2,940,011
Other	9,350	8,991
Accumulated depreciation, depletion and amortization	(1,524,207)	(1,415,973)
Total property, plant and equipment, net	1,599,504	1,533,029
OTHER ASSETS
Deferred financing costs, net	4,744	5,636
Deferred tax assets	131,404	162,792
Other long-term assets	16,229	20,381
Total other assets	152,377	188,809
TOTAL ASSETS	2,566,721	2,572,585
CURRENT LIABILITIES
Accounts payable	166,234	202,846
Other current liabilities (Note 5)	96,766	137,427
Total current liabilities	263,000	340,273
LONG-TERM LIABILITIES
Long-term debt, net	391,590	390,383
Asset retirement obligations, net of current	92,820	95,129
Other long-term liabilities	9,453	6,609
Total long-term liabilities	493,863	492,121
COMMITMENTS AND CONTINGENCIES (Note 7)
Additional paid-in capital	1,731,059	1,719,875
Treasury Stock, at cost, 26,334 shares and 21,684 shares in 2023 and 2022, respectively	(425,604)	(329,512)
Retained earnings	329,011	185,669
Noncontrolling interest	175,369	164,136
Total equity	1,809,858	1,740,191
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	2,566,721	2,572,585
Class A Common Stock
Common stock	$ 21	$ 21
Common Stock, Shares, Outstanding	188,066	192,043
Common Stock, Shares, Issued	214,400	213,727
Class B Common Stock
Common stock	$ 2	$ 2
Common Stock, Shares, Outstanding	21,827	21,827
Common Stock, Shares, Issued	21,827	21,827

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
Treasury stock (in shares)	26,334,000	21,684,000
Class A Common Stock
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	1,300,000,000	1,300,000,000
Common stock, shares issued (in shares)	214,400,000	213,727,000
Common stock, shares outstanding (in shares)	188,066,000	192,043,000
Class B Common Stock
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	225,000,000	225,000,000
Common stock, shares issued (in shares)	21,827,000	21,827,000
Common stock, shares outstanding (in shares)	21,827,000	21,827,000

XML

Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
REVENUES
Total revenues	$ 280,291	$ 484,649	$ 588,674	$ 862,489
OPERATING EXPENSES
Lease operating expenses	36,796	32,604	79,167	61,348
Gathering, transportation and processing	10,389	16,381	23,121	32,221
Taxes other than income	15,216	27,411	34,508	48,293
Exploration expenses	0	3,408	11	8,946
Asset retirement obligations accretion	823	802	1,664	1,590
Depreciation, depletion and amortization	77,008	57,254	147,710	110,360
Impairment of oil and natural gas properties	0	0	15,735	0
General and administrative expenses	18,726	18,530	38,492	35,601
Total operating expenses	158,958	156,390	340,408	298,359
OPERATING INCOME	121,333	328,259	248,266	564,130
OTHER INCOME (EXPENSE)
Interest expense, net	(1,149)	(7,017)	(662)	(16,374)
Other income, net	9,259	6,538	8,120	6,744
Total other income (expense), net	8,110	(479)	7,458	(9,630)
INCOME BEFORE INCOME TAXES	129,443	327,780	255,724	554,500
Income tax expense	24,847	27,875	44,452	45,975
NET INCOME	104,596	299,905	211,272	508,525
LESS: Net income attributable to noncontrolling interest	13,104	49,322	23,446	91,903
NET INCOME ATTRIBUTABLE TO CLASS A COMMON STOCK	$ 91,492	$ 250,583	$ 187,826	$ 416,622
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
Basic (in shares)	189,402	188,146	190,584	185,377
Diluted (in shares)	189,567	188,589	190,875	185,894
Class A Common Stock
NET INCOME PER SHARE OF CLASS A COMMON STOCK
Basic (in dollars per share)	$ 0.48	$ 1.32	$ 0.97	$ 2.23
Diluted (in dollars per share)	$ 0.48	$ 1.32	$ 0.97	$ 2.22
Oil revenues
REVENUES
Total revenues	$ 223,147	$ 332,791	$ 462,269	$ 595,459
Natural gas revenues
REVENUES
Total revenues	20,847	85,345	48,619	141,925
Natural gas liquids revenues
REVENUES
Total revenues	$ 36,297	$ 66,513	$ 77,786	$ 125,105

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Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Class A Common Stock	Class B Common Stock	Total Stockholders’ Equity	Total Stockholders’ Equity Class A Common Stock	Common Stock Class A Common Stock	Common Stock Class B Common Stock	Additional Paid In Capital	Treasury Stock	Treasury Stock Class A Common Stock	Retained Earnings/ (Accumulated Deficit)	Noncontrolling Interest	Noncontrolling Interest Class B Common Stock
Common Stock, Balance at beginning of period (in shares) at Dec. 31, 2021						193,437	49,293
Balance at beginning of period at Dec. 31, 2021	$ 1,045,249			$ 816,757		$ 19	$ 5	$ 1,689,500	$ (164,599)		$ (708,168)	$ 228,492
Treasury Stock, Balance at beginning of period (in shares) at Dec. 31, 2021									14,168
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense, net of forfeitures	6,402			5,349				5,349				1,053
Changes in ownership interest adjustment	0			(4,900)				(4,900)				4,900
Common stock issued related to stock based compensation and other, net (in shares)						659
Common stock issued related to stock based compensation and other, net	(6,102)			(5,029)				(5,029)				(1,073)
Class A Common Stock repurchases (in shares)										4,115
Class A Common Stock repurchases		$ (93,238)			$ (93,238)					$ (93,238)
Class B Common Stock purchase and cancellation (in shares)							(5,950)
Class B Common Stock purchase and cancellation			$ (138,753)										$ (138,753)
Conversion of Class B Common Stock to Class A Common Stock (in shares)						14,633	14,633
Conversion of Class B Common Stock to Class A Common Stock	0					$ 2	$ (2)
Dividends declared	(37,283)			(37,283)				(37,283)
Distributions to noncontrolling interest owners	(16,243)											(16,243)
Net income	508,525			416,622							416,622	91,903
Common Stock, Balance at end of period (in shares) at Jun. 30, 2022						208,729	28,710
Balance at end of period at Jun. 30, 2022	1,268,557			1,098,278		$ 21	$ 3	1,647,637	$ (257,837)		(291,546)	170,279
Treasury Stock, Balance at end of period (in shares) at Jun. 30, 2022									18,283
Common Stock, Balance at beginning of period (in shares) at Mar. 31, 2022						203,762	35,594
Balance at beginning of period at Mar. 31, 2022	1,072,368			897,588		$ 20	$ 4	1,649,111	$ (209,418)		(542,129)	174,780
Treasury Stock, Balance at beginning of period (in shares) at Mar. 31, 2022									16,218
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense, net of forfeitures	3,517			2,990				2,990				527
Changes in ownership interest adjustment	0			(4,305)				(4,305)				4,305
Common stock issued related to stock based compensation and other, net (in shares)						83
Common stock issued related to stock based compensation and other, net	(188)			(159)				(159)				(29)
Class A Common Stock repurchases (in shares)										2,065
Class A Common Stock repurchases		$ (48,419)			(48,419)					$ (48,419)
Class B Common Stock purchase and cancellation (in shares)							(2,000)
Class B Common Stock purchase and cancellation			$ (54,020)										$ (54,020)
Conversion of Class B Common Stock to Class A Common Stock (in shares)						4,884	4,884
Conversion of Class B Common Stock to Class A Common Stock	0					$ 1	$ (1)
Distributions to noncontrolling interest owners	(4,606)											(4,606)
Net income	299,905			250,583							250,583	49,322
Common Stock, Balance at end of period (in shares) at Jun. 30, 2022						208,729	28,710
Balance at end of period at Jun. 30, 2022	1,268,557			1,098,278		$ 21	$ 3	1,647,637	$ (257,837)		(291,546)	170,279
Treasury Stock, Balance at end of period (in shares) at Jun. 30, 2022									18,283
Common Stock, Balance at beginning of period (in shares) at Dec. 31, 2022		213,727	21,827			213,727	21,827
Balance at beginning of period at Dec. 31, 2022	$ 1,740,191			1,576,055		$ 21	$ 2	1,719,875	$ (329,512)		185,669	164,136
Treasury Stock, Balance at beginning of period (in shares) at Dec. 31, 2022	21,684								21,684
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense, net of forfeitures	$ 7,863			7,053				7,053				810
Changes in ownership interest adjustment	167			6,875				6,875				(6,708)
Common stock issued related to stock based compensation and other, net (in shares)						673
Common stock issued related to stock based compensation and other, net	(6,978)			(6,262)				(6,262)				(716)
Class A Common Stock repurchases (in shares)										4,650
Class A Common Stock repurchases		$ (96,092)			(96,092)					$ (96,092)
Dividends declared	(44,484)			(44,484)							(44,484)
Distributions to noncontrolling interest owners	(5,599)											(5,599)
Adjustment to deferred taxes	4,327			4,327				4,327
Tax impact of equity transactions	(809)			(809)				(809)
Net income	211,272			187,826							187,826	23,446
Common Stock, Balance at end of period (in shares) at Jun. 30, 2023		214,400	21,827			214,400	21,827
Balance at end of period at Jun. 30, 2023	$ 1,809,858			1,634,489		$ 21	$ 2	1,731,059	$ (425,604)		329,011	175,369
Treasury Stock, Balance at end of period (in shares) at Jun. 30, 2023	26,334								26,334
Common Stock, Balance at beginning of period (in shares) at Mar. 31, 2023						214,355	21,827
Balance at beginning of period at Mar. 31, 2023	$ 1,767,077			1,599,363		$ 21	$ 2	1,720,487	$ (380,783)		259,636	167,714
Treasury Stock, Balance at beginning of period (in shares) at Mar. 31, 2023									24,084
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense, net of forfeitures	4,092			3,668				3,668				424
Changes in ownership interest adjustment	167			2,936				2,936				(2,769)
Common stock issued related to stock based compensation and other, net (in shares)						45
Common stock issued related to stock based compensation and other, net	(152)			(137)				(137)				(15)
Class A Common Stock repurchases (in shares)										2,250
Class A Common Stock repurchases		$ (44,821)			$ (44,821)					$ (44,821)
Dividends declared	(22,117)			(22,117)							(22,117)
Distributions to noncontrolling interest owners	(3,089)											(3,089)
Adjustment to deferred taxes	4,543			4,543				4,543
Tax impact of equity transactions	(438)			(438)				(438)
Net income	104,596			91,492							91,492	13,104
Common Stock, Balance at end of period (in shares) at Jun. 30, 2023		214,400	21,827			214,400	21,827
Balance at end of period at Jun. 30, 2023	$ 1,809,858			$ 1,634,489		$ 21	$ 2	$ 1,731,059	$ (425,604)		$ 329,011	$ 175,369
Treasury Stock, Balance at end of period (in shares) at Jun. 30, 2023	26,334								26,334

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Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) (Parenthetical) - $ / shares	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023	Jun. 30, 2022
Statement of Stockholders' Equity [Abstract]
Common stock, dividends, declared (in dollars per share)	$ 0.115	$ 0.23	$ 0.20

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Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES
NET INCOME	$ 211,272	$ 508,525
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization	147,710	110,360
Exploration expenses, non-cash	9	0
Impairment of oil and natural gas properties	15,735	0
Asset retirement obligations accretion	1,664	1,590
Amortization of deferred financing costs	2,100	3,779
(Gain) on sale of assets	(3,946)	0
Deferred income tax expense	36,264	0
Stock based compensation	7,863	6,402
Changes in operating assets and liabilities:
Accounts receivable	32,922	(97,633)
Accounts payable	(36,189)	58,935
Accrued liabilities	(4,836)	27,675
Drilling advances	3,472	578
Other assets and liabilities, net	7,556	(2,207)
Net cash provided by operating activities	421,596	618,004
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions	(3,357)	(4,347)
Additions to oil and natural gas properties	(225,388)	(207,461)
Changes in working capital associated with additions to oil and natural gas properties	(39,424)	25,494
Other investing	(88)	(1,018)
Net cash used in investing activities	(268,257)	(187,332)
CASH FLOW FROM FINANCING ACTIVITIES
Dividends paid	(44,684)	(37,176)
Cash paid for debt modification	0	(5,272)
Distributions to noncontrolling interest owners	(5,599)	(16,243)
Other financing activities	(6,987)	(6,164)
Net cash used in financing activities	(152,212)	(295,763)
NET CHANGE IN CASH AND CASH EQUIVALENTS	1,127	134,909
Cash and cash equivalents – Beginning of period	675,441	366,982
Cash and cash equivalents – End of period	676,568	501,891
Supplemental cash items:
Cash paid for income taxes	7,828	37,138
Cash paid for interest	13,175	12,733
Supplemental non-cash investing and financing activity:
Accruals or liabilities for capital expenditures	28,500	55,430
Supplemental non-cash lease operating activity:
Right-of-use assets obtained in exchange for operating lease obligations	7,673	2,462
Class A Common Stock
CASH FLOW FROM FINANCING ACTIVITIES
Common Stock repurchases	(94,942)	(92,155)
Class B Common Stock
CASH FLOW FROM FINANCING ACTIVITIES
Common Stock repurchases	$ 0	$ (138,753)

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Description of Business and Basis of Presentation

6 Months Ended

Jun. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business and Basis of Presentation

Description of Business and Basis of Presentation

Organization and Nature of Operations

Magnolia Oil & Gas Corporation (the “Company” or “Magnolia”) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of oil, natural gas, and natural gas liquid (“NGL”) reserves. The Company’s oil and natural gas properties are located primarily in Karnes County and the Giddings area in South Texas where the Company targets the Eagle Ford Shale and Austin Chalk formations. Magnolia’s objective is to generate stock market value over the long-term through consistent organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow.

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, certain disclosures normally included in an Annual Report on Form 10-K have been omitted. The consolidated financial statements and related notes included in this Quarterly Report should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2022 (the “2022 Form 10-K”). Except as disclosed herein, there have been no material changes to the information disclosed in the Notes to the consolidated financial statements included in the Company’s 2022 Form 10-K.

In the opinion of management, all normal, recurring adjustments and accruals considered necessary to present fairly, in all material respects, the Company’s interim financial results have been included. Operating results for the periods presented are not necessarily indicative of expected results for the full year.

Certain reclassifications of prior period financial statements have been made to conform to current reporting practices. The consolidated financial statements include the accounts of the Company and its subsidiaries after elimination of intercompany transactions and balances. The Company’s interests in oil and natural gas exploration and production ventures and partnerships are proportionately consolidated. The Company reflects a noncontrolling interest representing primarily the interest owned by the Magnolia LLC Unit Holders through their ownership of Magnolia LLC Units in the consolidated financial statements. The noncontrolling interest is presented as a component of equity. See Note 9—Stockholders’ Equity for further discussion of the noncontrolling interest.

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

As of June 30, 2023, the Company’s significant accounting policies are consistent with those discussed in Note 1—Organization and Summary of Significant Accounting Policies of its consolidated financial statements contained in the Company’s 2022 Form 10-K.

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Revenue Recognition	6 Months Ended
	Jun. 30, 2023
Revenue from Contract with Customer [Abstract]
Revenue Recognition	Revenue RecognitionMagnolia’s revenues include the sale of crude oil, natural gas, and NGLs. The Company has concluded that disaggregating revenue by product type appropriately depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors and has reflected this disaggregation of revenue on the Company’s consolidated statements of operations for all periods presented. The Company’s receivables consist mainly of trade receivables from commodity sales and joint interest billings due from owners on properties the Company operates. Receivables from contracts with customers totaled $96.4 million as of June 30, 2023 and $138.6 million as of December 31, 2022. For further detail regarding the Company’s revenue recognition policies, please refer to Note 1—Organization and Summary of Significant Accounting Policies of the consolidated financial statements contained in the Company’s 2022 Form 10-K.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Certain of the Company’s assets and liabilities are carried at fair value and measured either on a recurring or nonrecurring basis. The Company’s fair value measurements are based either on actual market data or assumptions that other market participants would use in pricing an asset or liability in an orderly transaction, using the valuation hierarchy prescribed by GAAP under Accounting Standards Codification (“ASC”) 820.

The three levels of the fair value hierarchy under ASC 820 are as follows:

Level 1 - Quoted prices (unadjusted) in active markets for identical investments at the measurement date are used.

Level 2 - Pricing inputs are other than quoted prices included within Level 1 that are observable for the investment, either directly or indirectly. Level 2 pricing inputs include quoted prices for similar investments in active markets, quoted prices for identical or similar investments in markets that are not active, inputs other than quoted prices that are observable for the investment, and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Pricing inputs are unobservable and include situations where there is little, if any, market activity for the investment. The inputs used in determination of fair value require significant judgment and estimation.

Recurring Fair Value Measurements

The carrying value and fair value of the financial instrument that is not carried at fair value in the Company’s consolidated balance sheets at June 30, 2023 and December 31, 2022 are as follows:

	June 30, 2023				December 31, 2022
(In thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Long-term debt	$	391,590	$	388,800	$	390,383	$	382,704

The fair value of the 2026 Senior Notes at June 30, 2023 and December 31, 2022 is based on unadjusted quoted prices in an active market, which is considered a Level 1 input in the fair value hierarchy.

The Company has other financial instruments consisting primarily of receivables, payables, and other current assets and liabilities that approximate fair value due to the nature of the instruments and their relatively short maturities. Non-financial assets and liabilities initially measured at fair value include assets acquired and liabilities assumed in business combinations and asset retirement obligations.

Nonrecurring Fair Value Measurements

Certain of the Company’s assets and liabilities are measured at fair value on a nonrecurring basis. Specifically, stock based compensation is not measured at fair value on an ongoing basis but is subject to fair value calculations in certain circumstances. For further detail, see Note 10—Stock Based Compensation in the Notes to the consolidated financial statements. There were no other material nonrecurring fair value measurements as of June 30, 2023 or December 31, 2022.

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Other Current Liabilities

6 Months Ended

Jun. 30, 2023

Other Liabilities Disclosure [Abstract]

Other Current Liabilities

Other Current Liabilities

The following table provides detail of the Company’s other current liabilities for the periods presented:

(In thousands)	June 30, 2023		December 31, 2022
Accrued capital expenditures	$	28,500	$	67,923
Other	68,266		69,504
Total other current liabilities	$	96,766	$	137,427

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Long-term Debt

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

Long-term Debt

Long-term Debt

The Company’s long-term debt is comprised of the following:

(In thousands)	June 30, 2023		December 31, 2022
Revolving credit facility	$	—	$	—
Senior Notes due 2026	400,000		400,000
Total long-term debt	400,000		400,000
Less: Unamortized deferred financing cost	(8,410)		(9,617)
Long-term debt, net	$	391,590	$	390,383

Credit Facility

The original RBL Facility was entered into by and among Magnolia Operating, as borrower, Magnolia Intermediate, as its holding company, the banks, financial institutions, and other lending institutions from time to time party thereto, as lenders, the other parties from time to time party thereto, and Citibank, N.A., as administrative agent, collateral agent, issuing bank, and swingline lender. On February 16, 2022, Magnolia Operating, as borrower, amended and restated the RBL Facility in its entirety, providing for maximum commitments in an aggregate principal amount of $1.0 billion with a letter of credit facility with a $50.0 million sublimit, with a borrowing base of $450.0 million. The RBL Facility, maturing in February 2026, is guaranteed by certain parent companies and subsidiaries of Magnolia LLC and is collateralized by certain of Magnolia Operating’s oil and natural gas properties.

Borrowings under the RBL Facility bear interest, at Magnolia Operating’s option, at a rate per annum equal to either the term SOFR rate or the alternative base rate plus the applicable margin. Additionally, Magnolia Operating is required to pay a commitment fee quarterly in arrears in respect of unused commitments under the RBL Facility. The applicable margin and the commitment fee rate are calculated based upon the utilization levels of the RBL Facility as a percentage of unused lender commitments then in effect.

The RBL Facility contains certain affirmative and negative covenants customary for financings of this type, including compliance with a leverage ratio of less than 3.50 to 1.00 and a current ratio of greater than 1.00 to 1.00. As of June 30, 2023, the Company was in compliance with all covenants under the RBL Facility. The Company incurred approximately $5.5 million of lender and transaction fees related to the modification of which $5.1 million were recorded as deferred financing costs and will be amortized prospectively over the remaining term of the RBL Facility and $0.4 million of which were expensed and are reflected in “Interest expense, net” on the Company’s consolidated statements of operations for the six months ended June 30, 2022.

Deferred financing costs in connection with the RBL Facility are amortized on a straight-line basis over a period of four years from February 2022 to February 2026 and included in “Interest expense, net” in the Company’s consolidated statements of operations. The Company recognized interest expense related to the RBL Facility of $1.0 million for each of the three months ended June 30, 2023 and 2022, and $2.1 million and $3.7 million for the six months ended June 30, 2023 and 2022, respectively. The unamortized portion of the deferred financing costs is included in “Deferred financing costs, net” on the Company’s consolidated balance sheets as of June 30, 2023 and December 31, 2022.

The Company did not have any outstanding borrowings under the RBL Facility as of June 30, 2023.

2026 Senior Notes

On July 31, 2018, the Issuers issued and sold $400.0 million aggregate principal amount of 2026 Senior Notes in a private placement under Rule 144A and Regulation S under the Securities Act of 1933, as amended. The 2026 Senior Notes were issued under the Indenture, dated as of July 31, 2018 (the “Indenture”), by and among the Issuers and Deutsche Bank Trust Company Americas, as trustee. On April 5, 2021, the terms of the Indenture were amended to modify, among other things, the criteria used by the Company to make Restricted Payments (as defined in the Indenture). The 2026 Senior Notes are guaranteed on a senior unsecured basis by the Company, Magnolia Operating, and Magnolia Intermediate and may be guaranteed by certain future subsidiaries of the Company. The 2026 Senior Notes will mature on August 1, 2026 and bear interest at the rate of 6.0% per annum.

Deferred financing costs related to the issuance of, and the amendment to the Indenture governing, the 2026 Senior Notes are amortized using the effective interest method over the term of the 2026 Senior Notes and are included in “Interest expense, net” in the Company’s consolidated statements of operations. The unamortized portion of the deferred financing costs is included as a reduction to the carrying value of the 2026 Senior Notes, which has been recorded as “Long-term debt, net” on the Company’s consolidated balance sheets as of June 30, 2023 and December 31, 2022. The Company recognized interest expense related to the 2026 Senior

Notes of $6.6 million for each of the three months ended June 30, 2023 and 2022, and $13.2 million and $13.1 million for the six months ended June 30, 2023 and 2022, respectively.At any time, the Issuers may redeem all or a part of the 2026 Senior Notes based on principal plus a set premium, as set forth in the Indenture, including any accrued and unpaid interest.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Legal Matters

From time to time, the Company is or may become involved in litigation in the ordinary course of business.

Certain of the Magnolia LLC Unit Holders and EnerVest Energy Institutional Fund XIV-C, L.P. (collectively the “Co-Defendants”) and the Company have been named as defendants in a lawsuit where the plaintiffs claim to be entitled to a minority working interest in certain Karnes County Assets. The litigation is in the pre-trial stage. The exposure related to this litigation is currently not reasonably estimable. The Co-Defendants retain all such liability.

A mineral owner in a Magnolia operated well in Karnes County, Texas filed a complaint with the Texas Railroad Commission (the “Commission”) challenging the validity of the permit to drill such well by questioning the long-standing process by which the Commission granted the permit. After the Commission affirmed the granting of the permit, and after judicial review of the Commission’s order by the 53rd Judicial District Court Travis County, Texas (the “District Court”), the District Court reversed and remanded the Commission’s order. Upon appeal to the Third Court of Appeals in Austin, Texas (the“Court of Appeals”), the Court of Appeals reversed in part and affirmed in part the District Court’s ruling and remanded the matter to the Commission. The plaintiffs have filed a motion for rehearing with the Court of Appeals, and the parties are waiting for the Court’s decision.

At June 30, 2023, the Company does not believe the outcome of any such disputes or legal actions will have a material effect on its consolidated statements of operations, balance sheet, or cash flows. No amounts were accrued with respect to outstanding litigation at June 30, 2023 or June 30, 2022.

Environmental Matters

The Company, as an owner or lessee and operator of oil and natural gas properties, is subject to various federal, state, and local laws and regulations relating to discharge of materials into, and the protection of, the environment. These laws and regulations may, among other things, impose liability on a lessee under an oil and natural gas lease for the cost of pollution clean-up resulting from operations and subject the lessee to liability for pollution damages. In some instances, the Company may be directed to suspend or cease operations in an affected area. The Company maintains insurance coverage, which it believes is customary in the industry, although the Company is not fully insured against all environmental risks.

Risks and Uncertainties 

The Company’s revenue, profitability, and future growth are substantially dependent upon the prevailing and future prices for oil and natural gas, which depend on numerous factors beyond the Company’s control such as overall oil and natural gas production and inventories in relevant markets, economic conditions, the global and domestic political environments, regulatory developments, and competition from other energy sources. Oil and natural gas prices historically have been volatile and may be subject to significant fluctuations in the future. Additionally, the economy is experiencing elevated inflation levels as a result of global supply and demand imbalances. Inflationary pressures and labor shortages could result in further increases to our operating and capital costs.

Russia’s invasion of Ukraine in the first quarter of 2022, and global sanctions placed on Russia in response, have had and may continue to have a global impact on supply and demand for oil and natural gas. Magnolia continues to monitor any impacts from the Russia-Ukraine war on the global markets for its commodities.

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Income Taxes

6 Months Ended

Jun. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company’s income tax provision consists of the following components:

	Three Months Ended				Six Months Ended
(In thousands)	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Current:
Federal	$	3,405	$	25,902	$	7,055	$	42,687
State	581		1,973		1,133		3,288
Total current	3,986		27,875		8,188		45,975
Deferred:
Federal	20,025		—		34,845		—
State	836		—		1,419		—
Total deferred	20,861		—		36,264		—
Income tax expense	$	24,847	$	27,875	$	44,452	$	45,975

The Company is subject to U.S. federal income tax and margin tax in the state of Texas. The Company estimates its annual effective tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which it operates. The Company’s effective tax rate for the three months ended June 30, 2023 and 2022 was 19.2% and 8.5%, respectively, and 17.4% and 8.3% for the six months ended June 30, 2023 and 2022, respectively. As a result of impairments in the first quarter of 2020, the Company established full valuation allowances on the federal and state deferred tax assets, which resulted in additional differences between the effective tax rate and the statutory rate as of June 30, 2022. As of December 31, 2022, the Company released the valuation allowance against net deferred tax assets. The primary differences between the annual effective tax rate and the statutory rate of 21.0% are income attributable to noncontrolling interest, state taxes, and valuation allowances.

As of June 30, 2023, the Company does not anticipate recognition of any significant liabilities for uncertain tax positions during the next 12 months. For the six months ended June 30, 2023, no significant amounts were incurred for interest and penalties. Currently, the Company is not aware of any issues under review that could result in significant payments, accruals, or a material deviation from its position. The Company’s tax years since its formation remain subject to possible income tax examinations by its major taxing authorities.

As of June 30, 2023, the Company’s total deferred tax assets were $134.5 million. Management assessed whether it is more-likely-than-not that it will generate sufficient taxable income to realize its deferred income tax assets, including the investment in partnership and net operating loss carryforwards. In making this determination, the Company considered all available positive and negative evidence and made certain assumptions. The Company considered, among other things, the overall business environment, its historical earnings and losses, current industry trends, and its outlook for future years. As of June 30, 2023, the Company recorded a valuation allowance of $3.1 million to offset the deferred tax asset created by the capital loss attributable to the Highlander sale.

On August 16, 2022, the U.S. enacted legislation referred to as the Inflation Reduction Act (“IRA”), which significantly changes U.S. corporate income tax laws and is effective for tax years beginning after December 31, 2022. These changes include, among others, a new 15% corporate alternative minimum tax on adjusted financial statement income of corporations with profits over $1 billion, a 1% excise tax on stock buybacks, and various tax incentives for energy and climate initiatives. The Company evaluated the provisions of the IRA and determined that none of the provisions have a material impact on the Company’s reported results, cash flows or financial position for the current year. The Company will continue to evaluate the impacts of the IRA in future tax years.

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Stockholders' Equity

6 Months Ended

Jun. 30, 2023

Equity [Abstract]

Stockholders' Equity

Stockholders’ Equity

Class A Common Stock

At June 30, 2023, there were 214.4 million shares of Class A Common Stock issued and 188.1 million shares of Class A Common Stock outstanding. The holders of Class A Common Stock and Class B Common Stock vote together as a single class on all matters and are entitled one vote for each share held. There is no cumulative voting with respect to the election of directors, which results in the holders of more than 50% of the Company’s outstanding common shares being able to elect all of the directors, subject to voting obligations under the Stockholder Agreement. In the event of a liquidation, dissolution, or winding up of the Company, the holders of the Class A Common Stock are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of stock, if any, having preference over the common stock. The

holders of the Class A Common Stock have no preemptive or other subscription rights, and there are no sinking fund provisions applicable to such shares.

Class B Common Stock

At June 30, 2023, there were 21.8 million shares of Class B Common Stock issued and outstanding. Holders of Class B Common Stock vote together as a single class with holders of Class A Common Stock on all matters properly submitted to a vote of the stockholders. The holders of Class B Common Stock generally have the right to exchange all or a portion of their shares of Class B Common Stock, together with an equal number of Magnolia LLC Units, for the same number of shares of Class A Common Stock or, at Magnolia LLC’s option, an equivalent amount of cash. Upon the future redemption or exchange of Magnolia LLC Units held by any holder of Class B Common Stock, a corresponding number of shares of Class B Common Stock held by such holder of Class B Common Stock will be canceled. In the event of a liquidation, dissolution, or winding up of Magnolia LLC, the holders of the Class B Common Stock, through their ownership of Magnolia LLC Units, are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of units of Magnolia LLC, if any, having preference over the common units. The holders of the Class B Common Stock have no preemptive or other subscription rights, and there are no sinking fund provisions applicable to such shares.

Share Repurchases

As of June 30, 2023, the Company’s board of directors had authorized a share repurchase program of up to 30.0 million shares of Class A Common Stock. The program does not require purchases to be made within a particular time frame. The Company had repurchased 25.8 million shares under the program at a cost of $414.0 million and had 4.2 million shares of Class A Common Stock remaining under its share repurchase authorization as of June 30, 2023. On July 31, 2023, the Company’s board of directors increased the share repurchase authorization by an additional 10.0 million shares of Class A Common Stock, which increases total share repurchase authorization to 40.0 million shares.

During the six months ended June 30, 2022, the Company repurchased 0.6 million shares of Class A Common Stock for $11.6 million from EnerVest Energy Institutional Fund XIV-C, L.P. outside of the share repurchase program.

During the six months ended June 30, 2022 Magnolia LLC repurchased and subsequently canceled 5.9 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $138.8 million of cash consideration (the “Class B Common Stock Repurchases”). During the same period, the Magnolia LLC Unit Holders redeemed 14.6 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public.

Magnolia did not receive any proceeds from the sale of shares of Class A Common Stock by the Magnolia LLC Unit Holders. Magnolia funded the Class B Common Stock Repurchases with cash on hand.

Dividends and Distributions

The Company’s board of directors periodically declares dividends payable on issued and outstanding shares of Class A Common Stock, and a corresponding distribution from Magnolia LLC to Magnolia LLC Unit Holders. Dividends in excess of retained earnings are recorded as a reduction of additional paid-in capital and distributions to the Magnolia LLC Unit Holders are recorded as a reduction of noncontrolling interest.

The following table sets forth information with respect to cash dividends and distributions declared by the Company’s board of directors during the six months ended June 30, 2023 and the year ended December 31, 2022, on its own behalf and in its capacity as the managing member of Magnolia LLC, on issued and outstanding shares of Class A Common Stock and Magnolia LLC Units:

Record Date	Payment Date	Dividend/ Distribution Amount per share (1)		Distributions by Magnolia LLC (2)		Dividends Declared by the Company		Distributions to Magnolia LLC Unit Holders
(In thousands, except per share amounts)
May 11, 2023	June 1, 2023	$	0.115	$	24,627	$	22,117	$	2,510
February 10, 2023	March 1, 2023	$	0.115	$	24,878	$	22,368	$	2,510
November 7, 2022	December 1, 2022	$	0.100	$	21,867	$	18,996	$	2,871
August 12, 2022	September 1, 2022	$	0.100	$	21,983	$	19,112	$	2,871
February 14, 2022	March 1, 2022	$	0.200	$	45,851	$	37,283	$	8,568

(1)    Per share of Class A Common Stock and per Magnolia LLC Unit.

(2)    Reflects total cash dividend and distribution payments made, or to be made, to holders of Class A Common Stock and Magnolia LLC Unit Holders (other than the Company) as of the applicable record date.

Noncontrolling Interest

Noncontrolling interest in Magnolia’s consolidated subsidiaries includes amounts attributable to Magnolia LLC Units that were issued to the Magnolia LLC Unit Holders. The noncontrolling interest percentage is affected by various equity transactions such as issuances and repurchases of Class A Common Stock, the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) for Class A Common Stock, or the cancellation of Class B Common Stock (and corresponding Magnolia LLC Units). As of June 30, 2023, Magnolia owned approximately 89.6% of the interest in Magnolia LLC and the noncontrolling interest was approximately 10.4%.

Highlander was a joint venture whereby MGY Louisiana LLC, a wholly owned subsidiary of Magnolia Operating, held approximately 84.7% of the units of Highlander, with the remaining 15.3% attributable to noncontrolling interest. On May 30, 2023, the Company sold its interest in Highlander and recognized a gain on sale of $3.9 million included within “Other income, net” on the Company’s consolidated statements of operations.

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Stock Based Compensation

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

Stock Based Compensation

Stock Based Compensation

On October 8, 2018, the Company’s board of directors adopted the “Magnolia Oil & Gas Corporation Long Term Incentive Plan” (as amended, the “Plan”), effective as of July 17, 2018. A total of 16.8 million shares of Class A Common Stock have been authorized for issuance under the Plan as of June 30, 2023. The Company grants stock based compensation awards in the form of restricted stock units (“RSU”), performance restricted stock units (“PRSU”), and performance stock units (“PSU”) to eligible employees and directors to enhance the Company and its affiliates’ ability to attract, retain, and motivate persons who make important contributions to the Company and its affiliates by providing these individuals with equity ownership opportunities. Shares issued as a result of awards granted under the Plan are generally new shares of Class A Common Stock.

Stock based compensation expense is recognized net of forfeitures within “General and administrative expenses” and “Lease operating expenses” on the consolidated statements of operations and was $4.1 million and $3.5 million for the three months ended June 30, 2023 and 2022, and $7.9 million and $6.4 million for the six months ended June 30, 2023 and 2022, respectively. The Company has elected to account for forfeitures of awards granted under the Plan as they occur in determining compensation expense.

The following table presents a summary of Magnolia’s unvested RSU, PRSU, and PSU activity for the three months ended June 30, 2023.

	Restricted Stock Units			Performance Restricted Stock Units			Performance Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at March 31, 2023	1,186,712	$	18.79	946,229	$	13.65	232,700	$	24.69
Granted	63,728	20.31		9,772	21.88		—	—
Vested	(52,409)	19.13		—	—		—	—
Forfeited	(24,624)	17.47		(5,146)	14.14		—	—
Unvested at June 30, 2023	1,173,407	$	18.89	950,855	$	13.73	232,700	$	24.69

The following table presents a summary of Magnolia’s unvested RSU, PRSU, and PSU activity for the six months ended June 30, 2023.

	Restricted Stock Units			Performance Restricted Stock Units			Performance Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at December 31, 2022	911,286	$	12.89	1,257,583	$	13.36	278,486	$	6.14
Granted	679,405	22.81		15,524	22.28		232,700	24.69
Granted for performance multiple(1)	—	—		—	—		12,981	6.14
Vested	(376,625)	11.62		(314,963)	12.62		(291,467)	6.14
Forfeited	(40,659)	17.22		(7,289)	15.16		—	—
Unvested at June 30, 2023	1,173,407	$	18.89	950,855	$	13.73	232,700	$	24.69

(1) Upon completion of the performance period for the PSUs granted in 2020, a performance multiple of 105% was applied to each of the grants resulting in additional grants of PSUs in 2023.

Restricted Stock Units

The Company grants service-based RSU awards to employees, which generally vest ratably over a three-year or four-year service period, and to non-employee directors, which vest in full after one year. Non-employee directors may elect to defer the RSU settlement date. RSUs represent the right to receive shares of Class A Common Stock at the end of the vesting period equal to the number of RSUs that vest. RSUs are subject to restrictions on transfer and are generally subject to a risk of forfeiture if the award recipient ceases to be an employee or director of the Company prior to vesting of the award. Compensation expense for the service-based RSU awards is based upon the grant date market value of the award and such costs are recorded on a straight-line basis over the requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards. The aggregate fair value of RSUs that vested during the six months ended June 30, 2023 and 2022 were $8.3 million and $10.2 million, respectively. Unrecognized compensation expense related to unvested RSUs as of June 30, 2023 was $18.1 million, which the Company expects to recognize over a weighted average period of 2.6 years.

Performance Restricted Stock Units and Performance Stock Units

The Company grants PRSUs to certain employees. Each PRSU represents the contingent right to receive one share of Class A Common Stock once the PRSU is both vested and earned. PRSUs generally vest either ratably over a three-year service period or at the end of a three-year service period, in each case, subject to the recipient’s continued employment or service through each applicable vesting date. Each PRSU is earned based on whether Magnolia’s stock price achieves a target average stock price for any 20 consecutive trading days during the five-year performance period. If PRSUs are not earned by the end of the five-year performance period (“Performance Condition”), the PRSUs will be forfeited and no shares of Class A Common Stock will be issued, even if the vesting conditions have been met. Compensation expense for the PRSU awards is based upon grant date fair market value of the award, calculated using a Monte Carlo simulation, as presented below, and such costs are recorded on a straight-line basis over the requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards, as applicable. The aggregate fair value of PRSU awards that vested during the six months ended June 30, 2023 and 2022 were $7.0 million and $4.8 million. Unrecognized compensation expense related to unvested PRSUs as of June 30, 2023 was $6.1 million, which the Company expects to recognize over a weighted average period of 1.5 years.

The Company grants PSUs to certain employees. Each PSU, to the extent earned, represents the contingent right to receive one share of Class A Common Stock and the awardee may earn between zero and 150% of the target number of PSUs granted based on the total shareholder return (“TSR”) of the Class A Common Stock relative to the TSR achieved by a specific industry peer group over a three-year performance period, the last day of which is also the vesting date. In addition to the TSR conditions, vesting of the PSUs is subject to the awardee’s continued employment through the date of settlement of the PSUs, which will occur within 60 days following the end of the performance period. The aggregate fair value of PSU awards that vested during the six months ended June 30, 2023 and 2022 were $6.7 million and $5.5 million, respectively. Unrecognized compensation expense related to unvested PSUs as of June 30, 2023 was $5.0 million, which the Company expects to recognize over a weighted average period of 2.6 years.

The Performance Condition for the PRSUs granted in 2022 were met on March 28, 2022, therefore the fair value of the PRSUs granted after the Performance Condition were met were based upon the grant date market value of the award. The fair values of the awards granted prior to the date the Performance Condition was met were determined using a Monte Carlo simulation. The following table summarizes the Monte Carlo simulation assumptions used to calculate the grant date fair value of the PSUs in 2023 and PRSUs in 2022.

	Six Months Ended
PSU and PRSU Grant Date Fair Value Assumptions	June 30, 2023	June 30, 2022
Expected term (in years)	2.88	3.55
Expected volatility	60.80%	59.58%
Risk-free interest rate	4.15%	1.89%
Dividend yield	1.93%	1.97%

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Earnings Per Share

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

The Company’s unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are deemed participating securities, and therefore dividends and net income allocated to such awards have been deducted from earnings in computing basic and diluted net income per share under the two-class method. Diluted net income per share attributable to Class A Common Stock is calculated under both the two-class method and the treasury stock method and the more dilutive of the two calculations is presented.

The components of basic and diluted net income per share attributable to Class A Common Stock are as follows:

	Three Months Ended				Six Months Ended
(In thousands, except per share data)	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Basic:
Net income attributable to Class A Common Stock	$	91,492	$	250,583	$	187,826	$	416,622
Less: Dividends and net income allocated to participating securities	1,038		2,373		2,036		3,756
Net income, net of participating securities	$	90,454	$	248,210	$	185,790	$	412,866
Weighted average number of common shares outstanding during the period - basic	189,402		188,146		190,584		185,377
Net income per share of Class A Common Stock - basic	$	0.48	$	1.32	$	0.97	$	2.23
Diluted:
Net income attributable to Class A Common Stock	$	91,492	$	250,583	$	187,826	$	416,622
Less: Dividends and net income allocated to participating securities	1,037		2,367		2,034		3,747
Net income, net of participating securities	$	90,455	$	248,216	$	185,792	$	412,875
Weighted average number of common shares outstanding during the period - basic	189,402		188,146		190,584		185,377
Add: Dilutive effect of stock based compensation and other	165		443		291		517
Weighted average number of common shares outstanding during the period - diluted	189,567		188,589		190,875		185,894
Net income per share of Class A Common Stock - diluted	$	0.48	$	1.32	$	0.97	$	2.22

For the three months ended June 30, 2023 and 2022, the Company excluded 21.8 million and 33.8 million, respectively, of weighted average shares of Class A Common Stock issuable upon the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) as the effect was anti-dilutive. For the six months ended June 30, 2023 and 2022, the Company excluded 21.8 million and 39.0 million, respectively, of weighted average shares of Class A Common Stock issuable upon the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) as the effect was anti-dilutive.

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Related Party Transactions	6 Months Ended
	Jun. 30, 2023
Related Party Transactions [Abstract]
Related Party Transactions	Related Party TransactionsAs of June 30, 2023, no entity held more than 10% of the Company’s common stock or qualified as a principal owner of the Company, as defined in ASC 850, “Related Party Disclosures.”

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Subsequent Events

6 Months Ended

Jun. 30, 2023

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

On July 31, 2023, the Company’s board of directors declared a quarterly cash dividend of $0.115 per share of Class A Common Stock, and a cash distribution of $0.115 per Magnolia LLC Unit, payable on September 1, 2023 to shareholders or members of record, as applicable, as of August 10, 2023.

On July 31, 2023, the Company’s board of directors increased the share repurchase authorization by an additional 10.0 million shares of Class A Common Stock, which increases total share repurchase authorization to 40.0 million shares.

On July 31, 2023, Magnolia closed an acquisition in the Giddings area, outside of the Company’s core development area, for a total cash consideration of approximately $40.0 million, subject to customary closing adjustments.

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Pay vs Performance Disclosure
Net income attributable to Class A Common Stock	$ 91,492	$ 250,583	$ 187,826	$ 416,622

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Insider Trading Arrangements	3 Months Ended
	Jun. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Organization and Nature of Operations

Organization and Nature of Operations

Magnolia Oil & Gas Corporation (the “Company” or “Magnolia”) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of oil, natural gas, and natural gas liquid (“NGL”) reserves. The Company’s oil and natural gas properties are located primarily in Karnes County and the Giddings area in South Texas where the Company targets the Eagle Ford Shale and Austin Chalk formations. Magnolia’s objective is to generate stock market value over the long-term through consistent organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow.

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, certain disclosures normally included in an Annual Report on Form 10-K have been omitted. The consolidated financial statements and related notes included in this Quarterly Report should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2022 (the “2022 Form 10-K”). Except as disclosed herein, there have been no material changes to the information disclosed in the Notes to the consolidated financial statements included in the Company’s 2022 Form 10-K.

In the opinion of management, all normal, recurring adjustments and accruals considered necessary to present fairly, in all material respects, the Company’s interim financial results have been included. Operating results for the periods presented are not necessarily indicative of expected results for the full year.

Reclassification

Certain reclassifications of prior period financial statements have been made to conform to current reporting practices.

Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries after elimination of intercompany transactions and balances. The Company’s interests in oil and natural gas exploration and production ventures and partnerships are proportionately consolidated. The Company reflects a noncontrolling interest representing primarily the interest owned by the Magnolia LLC Unit Holders through their ownership of Magnolia LLC Units in the consolidated financial statements. The noncontrolling interest is presented as a component of equity.

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2023

Fair Value Disclosures [Abstract]

Schedule of Carrying Values and Fair Values of Financial Instruments Not Carried at Fair Value

The carrying value and fair value of the financial instrument that is not carried at fair value in the Company’s consolidated balance sheets at June 30, 2023 and December 31, 2022 are as follows:

	June 30, 2023				December 31, 2022
(In thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Long-term debt	$	391,590	$	388,800	$	390,383	$	382,704

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Other Current Liabilities (Tables)

6 Months Ended

Jun. 30, 2023

Other Liabilities Disclosure [Abstract]

Schedule of Other Current Liabilities

The following table provides detail of the Company’s other current liabilities for the periods presented:

(In thousands)	June 30, 2023		December 31, 2022
Accrued capital expenditures	$	28,500	$	67,923
Other	68,266		69,504
Total other current liabilities	$	96,766	$	137,427

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Long-term Debt (Tables)

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

Schedule of Components of Debt

The Company’s long-term debt is comprised of the following:

(In thousands)	June 30, 2023		December 31, 2022
Revolving credit facility	$	—	$	—
Senior Notes due 2026	400,000		400,000
Total long-term debt	400,000		400,000
Less: Unamortized deferred financing cost	(8,410)		(9,617)
Long-term debt, net	$	391,590	$	390,383

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Income Taxes (Tables)

6 Months Ended

Jun. 30, 2023

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Provision (Benefit)

The Company’s income tax provision consists of the following components:

	Three Months Ended				Six Months Ended
(In thousands)	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Current:
Federal	$	3,405	$	25,902	$	7,055	$	42,687
State	581		1,973		1,133		3,288
Total current	3,986		27,875		8,188		45,975
Deferred:
Federal	20,025		—		34,845		—
State	836		—		1,419		—
Total deferred	20,861		—		36,264		—
Income tax expense	$	24,847	$	27,875	$	44,452	$	45,975

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Stockholders' Equity (Tables)

6 Months Ended

Jun. 30, 2023

Equity [Abstract]

Schedule of Dividends

The following table sets forth information with respect to cash dividends and distributions declared by the Company’s board of directors during the six months ended June 30, 2023 and the year ended December 31, 2022, on its own behalf and in its capacity as the managing member of Magnolia LLC, on issued and outstanding shares of Class A Common Stock and Magnolia LLC Units:

Record Date	Payment Date	Dividend/ Distribution Amount per share (1)		Distributions by Magnolia LLC (2)		Dividends Declared by the Company		Distributions to Magnolia LLC Unit Holders
(In thousands, except per share amounts)
May 11, 2023	June 1, 2023	$	0.115	$	24,627	$	22,117	$	2,510
February 10, 2023	March 1, 2023	$	0.115	$	24,878	$	22,368	$	2,510
November 7, 2022	December 1, 2022	$	0.100	$	21,867	$	18,996	$	2,871
August 12, 2022	September 1, 2022	$	0.100	$	21,983	$	19,112	$	2,871
February 14, 2022	March 1, 2022	$	0.200	$	45,851	$	37,283	$	8,568

(1)    Per share of Class A Common Stock and per Magnolia LLC Unit.

(2)    Reflects total cash dividend and distribution payments made, or to be made, to holders of Class A Common Stock and Magnolia LLC Unit Holders (other than the Company) as of the applicable record date.

Schedule of Distributions Made to Limited Liability Company (LLC) Member, by Distribution

The following table sets forth information with respect to cash dividends and distributions declared by the Company’s board of directors during the six months ended June 30, 2023 and the year ended December 31, 2022, on its own behalf and in its capacity as the managing member of Magnolia LLC, on issued and outstanding shares of Class A Common Stock and Magnolia LLC Units:

Record Date	Payment Date	Dividend/ Distribution Amount per share (1)		Distributions by Magnolia LLC (2)		Dividends Declared by the Company		Distributions to Magnolia LLC Unit Holders
(In thousands, except per share amounts)
May 11, 2023	June 1, 2023	$	0.115	$	24,627	$	22,117	$	2,510
February 10, 2023	March 1, 2023	$	0.115	$	24,878	$	22,368	$	2,510
November 7, 2022	December 1, 2022	$	0.100	$	21,867	$	18,996	$	2,871
August 12, 2022	September 1, 2022	$	0.100	$	21,983	$	19,112	$	2,871
February 14, 2022	March 1, 2022	$	0.200	$	45,851	$	37,283	$	8,568

(1)    Per share of Class A Common Stock and per Magnolia LLC Unit.

(2)    Reflects total cash dividend and distribution payments made, or to be made, to holders of Class A Common Stock and Magnolia LLC Unit Holders (other than the Company) as of the applicable record date.

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Stock Based Compensation (Tables)

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Unvested RSU, PSU, and PRSU Activity

The following table presents a summary of Magnolia’s unvested RSU, PRSU, and PSU activity for the three months ended June 30, 2023.

	Restricted Stock Units			Performance Restricted Stock Units			Performance Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at March 31, 2023	1,186,712	$	18.79	946,229	$	13.65	232,700	$	24.69
Granted	63,728	20.31		9,772	21.88		—	—
Vested	(52,409)	19.13		—	—		—	—
Forfeited	(24,624)	17.47		(5,146)	14.14		—	—
Unvested at June 30, 2023	1,173,407	$	18.89	950,855	$	13.73	232,700	$	24.69

The following table presents a summary of Magnolia’s unvested RSU, PRSU, and PSU activity for the six months ended June 30, 2023.

	Restricted Stock Units			Performance Restricted Stock Units			Performance Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at December 31, 2022	911,286	$	12.89	1,257,583	$	13.36	278,486	$	6.14
Granted	679,405	22.81		15,524	22.28		232,700	24.69
Granted for performance multiple(1)	—	—		—	—		12,981	6.14
Vested	(376,625)	11.62		(314,963)	12.62		(291,467)	6.14
Forfeited	(40,659)	17.22		(7,289)	15.16		—	—
Unvested at June 30, 2023	1,173,407	$	18.89	950,855	$	13.73	232,700	$	24.69

(1) Upon completion of the performance period for the PSUs granted in 2020, a performance multiple of 105% was applied to each of the grants resulting in additional grants of PSUs in 2023.

Schedule of Assumptions Used to Calculate Grant Date Fair Value of PRSUs

The following table summarizes the Monte Carlo simulation assumptions used to calculate the grant date fair value of the PSUs in 2023 and PRSUs in 2022.

	Six Months Ended
PSU and PRSU Grant Date Fair Value Assumptions	June 30, 2023	June 30, 2022
Expected term (in years)	2.88	3.55
Expected volatility	60.80%	59.58%
Risk-free interest rate	4.15%	1.89%
Dividend yield	1.93%	1.97%

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

Schedule of Reconciliation of Numerators and Denominators for Basic and Diluted Per Share Computation

The components of basic and diluted net income per share attributable to Class A Common Stock are as follows:

	Three Months Ended				Six Months Ended
(In thousands, except per share data)	June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Basic:
Net income attributable to Class A Common Stock	$	91,492	$	250,583	$	187,826	$	416,622
Less: Dividends and net income allocated to participating securities	1,038		2,373		2,036		3,756
Net income, net of participating securities	$	90,454	$	248,210	$	185,790	$	412,866
Weighted average number of common shares outstanding during the period - basic	189,402		188,146		190,584		185,377
Net income per share of Class A Common Stock - basic	$	0.48	$	1.32	$	0.97	$	2.23
Diluted:
Net income attributable to Class A Common Stock	$	91,492	$	250,583	$	187,826	$	416,622
Less: Dividends and net income allocated to participating securities	1,037		2,367		2,034		3,747
Net income, net of participating securities	$	90,455	$	248,216	$	185,792	$	412,875
Weighted average number of common shares outstanding during the period - basic	189,402		188,146		190,584		185,377
Add: Dilutive effect of stock based compensation and other	165		443		291		517
Weighted average number of common shares outstanding during the period - diluted	189,567		188,589		190,875		185,894
Net income per share of Class A Common Stock - diluted	$	0.48	$	1.32	$	0.97	$	2.22

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Revenue Recognition (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Revenue from Contract with Customer [Abstract]
Receivables from contracts with customers	$ 96.4	$ 138.6

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Fair Value Measurements - Carrying Values and Fair Values of Financial Instruments Not Carried at Fair Value (Details) - Fair Value, Inputs, Level 1 - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt	$ 391,590	$ 390,383
Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt	$ 388,800	$ 382,704

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Other Current Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Other Liabilities Disclosure [Abstract]
Accrued capital expenditures	$ 28,500	$ 67,923
Other	68,266	69,504
Total other current liabilities	$ 96,766	$ 137,427

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Long-term Debt - Components of Debt (Details) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Total long-term debt	$ 400,000,000	$ 400,000,000
Less: Unamortized deferred financing cost	(8,410,000)	(9,617,000)
Long-term debt, net	391,590,000	390,383,000
Line of Credit | Revolving credit facility
Debt Instrument [Line Items]
Total long-term debt	0	0
Senior Notes | Senior Notes due 2026
Debt Instrument [Line Items]
Total long-term debt	$ 400,000,000	$ 400,000,000

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Long-term Debt - Credit Facility Narrative (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)	Feb. 16, 2022 USD ($)
Line of Credit Facility [Line Items]
Deferred financing costs, net	$ 4,744,000		$ 4,744,000		$ 5,636,000
Amortization of deferred financing costs			2,100,000	$ 3,779,000
Outstanding borrowings	400,000,000		$ 400,000,000		400,000,000
Line of Credit | Amended and Restated RBL Facility | Magnolia Operating
Line of Credit Facility [Line Items]
Maximum commitments, aggregate principal amount						$ 1,000,000,000
Borrowing base						$ 450,000,000
Leverage ratio (less than)						3.50
Current ratio (greater than)						1.00
Transaction fees related to the modification						$ 5,500,000
Deferred financing costs, net						5,100,000
Amortization of deferred financing costs				400,000
Line of Credit | Letter of Credit Sublimit | Magnolia Operating
Line of Credit Facility [Line Items]
Maximum commitments, aggregate principal amount						$ 50,000,000
Line of Credit | RBL Facility
Line of Credit Facility [Line Items]
Amortization period			4 years
Interest expense	1,000,000	$ 1,000,000	$ 2,100,000	$ 3,700,000
Outstanding borrowings	$ 0		$ 0		$ 0

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Long-term Debt - 2026 Senior Notes Narrative (Details) - Senior Notes - Senior Notes due 2026 - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Jul. 31, 2018
Debt Instrument [Line Items]
Aggregate principal amount					$ 400,000,000
Stated interest rate					6.00%
Interest expense	$ 6,600,000	$ 6,600,000	$ 13,200,000	$ 13,100,000

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Commitments and Contingencies (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
Amounts accrued with respect to outstanding litigation	$ 0	$ 0

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Income Taxes - Components of Income Tax Provision (Benefit) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Current:
Federal	$ 3,405	$ 25,902	$ 7,055	$ 42,687
State	581	1,973	1,133	3,288
Total current	3,986	27,875	8,188	45,975
Deferred:
Federal	20,025	0	34,845	0
State	836	0	1,419	0
Total deferred	20,861	0	36,264	0
Income tax expense	$ 24,847	$ 27,875	$ 44,452	$ 45,975

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Income Taxes - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Tax Disclosure [Abstract]
Effective tax rate	19.20%	8.50%	17.40%	8.30%
Net deferred tax asset	$ 134.5		$ 134.5
Valuation allowance	$ 3.1		$ 3.1

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Stockholders' Equity - Narrative (Details) $ in Thousands		3 Months Ended		5 Months Ended	6 Months Ended
	May 30, 2023 USD ($)	Jun. 30, 2023 USD ($) vote shares	Jun. 30, 2022 USD ($)	May 30, 2023	Jun. 30, 2023 USD ($) vote shares	Jun. 30, 2022 USD ($) shares	Jul. 31, 2023 shares	Dec. 31, 2022 shares
Highlander
Class of Stock [Line Items]
Gain recognized on sale of partnership | $	$ 3,900
Highlander
Class of Stock [Line Items]
Percentage of interest owned by noncontrolling interest holders	15.30%			15.30%
VIE, Primary Beneficiary | Magnolia LLC
Class of Stock [Line Items]
Percentage of interest owned					89.60%
Percentage of interest owned by noncontrolling interest holders		10.40%			10.40%
MGY Louisiana LLC | Highlander
Class of Stock [Line Items]
Percentage of units held				84.70%
Magnolia LLC
Class of Stock [Line Items]
Stock repurchased, cash consideration | $						$ 138,800
Class A Common Stock
Class of Stock [Line Items]
Common stock, shares issued (in shares)		214,400,000			214,400,000			213,727,000
Common stock, shares outstanding (in shares)		188,066,000			188,066,000			192,043,000
Number of votes for each share held | vote		1			1
Total cost of shares repurchased | $		$ 44,821	$ 48,419		$ 96,092	93,238
Stock repurchased, cash consideration | $					$ 94,942	$ 92,155
Class A Common Stock | EnerVest Energy Institutional Fund XIV-C, L.P. | Affiliate of EnerVest
Class of Stock [Line Items]
Number of shares repurchased (in shares)						600,000
Total cost of shares repurchased | $						$ 11,600
Class A Common Stock | Share Repurchase Program
Class of Stock [Line Items]
Number of shares authorized to be repurchased (in shares)		30,000,000			30,000,000
Number of shares repurchased (in shares)					25,800,000
Total cost of shares repurchased | $					$ 414,000
Repurchase authorization		4,200,000			4,200,000
Class A Common Stock | Share Repurchase Program | Subsequent Event
Class of Stock [Line Items]
Number of shares authorized to be repurchased (in shares)							40,000,000
Number additional of shares authorized to be repurchased (in shares)							10,000,000
Class B Common Stock
Class of Stock [Line Items]
Common stock, shares issued (in shares)		21,827,000			21,827,000			21,827,000
Common stock, shares outstanding (in shares)		21,827,000			21,827,000			21,827,000
Number of votes for each share held | vote		1			1
Stock repurchased, cash consideration | $					$ 0	$ 138,753
Class B Common Stock | Magnolia LLC
Class of Stock [Line Items]
Stock repurchased and subsequently canceled (in shares)						5,900,000
Class B Common Stock | Magnolia LLC Unit Holders
Class of Stock [Line Items]
Stock redeemed (in shares)						14,600,000
Magnolia LLC Units | Magnolia LLC
Class of Stock [Line Items]
Stock repurchased and subsequently canceled (in shares)						5,900,000

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Stockholders' Equity - Schedule of Dividends and Distributions (Details) - USD ($) $ / shares in Units, $ in Thousands						6 Months Ended
	Jun. 01, 2023	Mar. 01, 2023	Dec. 01, 2022	Sep. 01, 2022	Mar. 01, 2022	Jun. 30, 2023	Jun. 30, 2022
Class of Stock [Line Items]
Dividend/ Distribution Amount per share (in dollars per share)	$ 0.115	$ 0.115	$ 0.100	$ 0.100	$ 0.200
Distributions by Magnolia LLC	$ 2,510	$ 2,510	$ 2,871	$ 2,871	$ 8,568
Dividends Declared by the Company						$ 44,684	$ 37,176
Class A Common Stock
Class of Stock [Line Items]
Common stock, dividends, declared (in dollars per share)	$ 0.115	$ 0.115	$ 0.100	$ 0.100	$ 0.200
Dividends Declared by the Company	$ 22,117	$ 22,368	$ 18,996	$ 19,112	$ 37,283
Magnolia LLC
Class of Stock [Line Items]
Distributions by Magnolia LLC	$ 24,627	$ 24,878	$ 21,867	$ 21,983	$ 45,851

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Stock Based Compensation - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense	$ 4.1	$ 3.5	$ 7.9	$ 6.4
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate fair value of equity instruments vested during the period			8.3	10.2
Unrecognized compensation expense	18.1		$ 18.1
Weighted average period over which unrecognized compensation expense is expected to be recognized			2 years 7 months 6 days
RSUs | Employees | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			3 years
RSUs | Employees | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			4 years
RSUs | Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			1 year
PRSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			3 years
Aggregate fair value of equity instruments vested during the period			$ 7.0	4.8
Unrecognized compensation expense	6.1		$ 6.1
Weighted average period over which unrecognized compensation expense is expected to be recognized			1 year 6 months
Number of consecutive trading days required to earn PRSUs			20 days
Performance period			5 years
PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate fair value of equity instruments vested during the period			$ 6.7	$ 5.5
Unrecognized compensation expense	$ 5.0		$ 5.0
Weighted average period over which unrecognized compensation expense is expected to be recognized			2 years 7 months 6 days
Performance period			3 years
Vesting percentage			105.00%
Settlement date, period following performance period			60 days
Class A Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized for issuance (in shares)	16,800,000		16,800,000
Class A Common Stock | PRSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Contingent right to receive common stock, number of shares receivable for each PSU (in shares)	1		1
Class A Common Stock | PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Contingent right to receive common stock, number of shares receivable for each PSU (in shares)	1		1
Class A Common Stock | PSUs | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			0.00%
Class A Common Stock | PSUs | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			150.00%

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Stock Based Compensation - Schedule of Unvested RSU, PSU, and PRSU Activity (Details) - $ / shares	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023
Restricted Stock Units
Units
Unvested stock units, beginning of period (in shares)	1,186,712	911,286
Granted (in shares)	63,728	679,405
Granted for performance multiple (in shares)		0
Vested (in shares)	(52,409)	(376,625)
Forfeited (in shares)	(24,624)	(40,659)
Unvested stock units, end of period (in shares)	1,173,407	1,173,407
Weighted Average Grant Date Fair Value
Unvested stock units, beginning of period (in dollars per share)	$ 18.79	$ 12.89
Granted (in dollars per share)	20.31	22.81
Granted for performance multiple (in dollars per share)		0
Vested (in dollars per share)	19.13	11.62
Forfeited (in dollars per share)	17.47	17.22
Unvested stock units, end of period (in dollars per share)	$ 18.89	$ 18.89
Performance Restricted Stock Units
Units
Unvested stock units, beginning of period (in shares)	946,229	1,257,583
Granted (in shares)	9,772	15,524
Granted for performance multiple (in shares)		0
Vested (in shares)	0	(314,963)
Forfeited (in shares)	(5,146)	(7,289)
Unvested stock units, end of period (in shares)	950,855	950,855
Weighted Average Grant Date Fair Value
Unvested stock units, beginning of period (in dollars per share)	$ 13.65	$ 13.36
Granted (in dollars per share)	21.88	22.28
Granted for performance multiple (in dollars per share)		0
Vested (in dollars per share)	0	12.62
Forfeited (in dollars per share)	14.14	15.16
Unvested stock units, end of period (in dollars per share)	$ 13.73	$ 13.73
Performance Stock Units
Units
Unvested stock units, beginning of period (in shares)	232,700	278,486
Granted (in shares)	0	232,700
Granted for performance multiple (in shares)		12,981
Vested (in shares)	0	(291,467)
Forfeited (in shares)	0	0
Unvested stock units, end of period (in shares)	232,700	232,700
Weighted Average Grant Date Fair Value
Unvested stock units, beginning of period (in dollars per share)	$ 24.69	$ 6.14
Granted (in dollars per share)	0	24.69
Granted for performance multiple (in dollars per share)		6.14
Vested (in dollars per share)	0	6.14
Forfeited (in dollars per share)	0	0
Unvested stock units, end of period (in dollars per share)	$ 24.69	$ 24.69
Vesting percentage		105.00%

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Stock Based Compensation - Schedule of Assumptions Used to Calculate Grant Date Fair Value of PRSUs (Details) - Performance Restricted Stock Units (PRSU) and Performance Shares (PSU)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	2 years 10 months 17 days	3 years 6 months 18 days
Expected volatility	60.80%	59.58%
Risk-free interest rate	4.15%	1.89%
Dividend yield	1.93%	1.97%

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Earnings Per Share - Reconciliation of Numerators and Denominators for Basic and Diluted Per Share Computation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Basic:
Net income attributable to Class A Common Stock	$ 91,492	$ 250,583	$ 187,826	$ 416,622
Less: Dividends and net income allocated to participating securities	1,038	2,373	2,036	3,756
Net income, net of participating securities	$ 90,454	$ 248,210	$ 185,790	$ 412,866
Weighted average number of common shares outstanding during the period - basic (in shares)	189,402	188,146	190,584	185,377
Diluted:
Net income attributable to Class A Common Stock	$ 91,492	$ 250,583	$ 187,826	$ 416,622
Less: Dividends and net income allocated to participating securities	1,037	2,367	2,034	3,747
Net income, net of participating securities	$ 90,455	$ 248,216	$ 185,792	$ 412,875
Weighted average number of common shares outstanding during the period - basic (in shares)	189,402	188,146	190,584	185,377
Add: Dilutive effect of stock based compensation and other (in shares)	165	443	291	517
Weighted average number of common shares outstanding during the period - diluted (in shares)	189,567	188,589	190,875	185,894
Class A Common Stock
Basic:
Net income per share of Class A Common Stock - basic (in dollars per share)	$ 0.48	$ 1.32	$ 0.97	$ 2.23
Diluted:
Net income per share of Class A Common Stock - diluted (in dollars per share)	$ 0.48	$ 1.32	$ 0.97	$ 2.22

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Earnings Per Share - Narrative (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Class A Common Stock
Class of Stock [Line Items]
Shares excluded due to antidilutive effect (in shares)	21.8	33.8	21.8	39.0

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Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Millions		3 Months Ended	6 Months Ended
	Jul. 31, 2023	Jun. 30, 2023	Jun. 30, 2023	Jun. 30, 2022
Subsequent Event [Line Items]
Common stock, dividends, declared (in dollars per share)		$ 0.115	$ 0.23	$ 0.20
Class A Common Stock | Share Repurchase Program
Subsequent Event [Line Items]
Number of shares authorized to be repurchased (in shares)		30,000,000	30,000,000
Subsequent Event | Acquisition In Giddings Area
Subsequent Event [Line Items]
Aggregate consideration, cash	$ 40.0
Subsequent Event | Class A Common Stock
Subsequent Event [Line Items]
Common stock, dividends, declared (in dollars per share)	$ 0.115
Subsequent Event | Class A Common Stock | Share Repurchase Program
Subsequent Event [Line Items]
Number additional of shares authorized to be repurchased (in shares)	10,000,000
Number of shares authorized to be repurchased (in shares)	40,000,000
Subsequent Event | Magnolia LLC Units
Subsequent Event [Line Items]
Distribution made to LLC member, distributions declared (in dollars per share)	$ 0.115