Exhibit 10(23)
STATEMENT OF TERMS AND CONDITIONS OF EMPLOYMENT
For
RICHARD BATTEY

     
Employer:
  VAZON ENERGY LIMITED a company incorporated and existing under the laws of
Guernsey with registered number 32244 (the “Company”)
 
   
Employee:
  RICHARD BATTEY (the “Employee”) of Woodgrange, Fort Road, Guernsey GY1 1ZW.

Starting Date of Employment: 6th May 2005
Starting Date of Continuous Employment: 6thMay 2005 1

    Job Title/Job Description   1.1   The Employee is employed by the Company on
a full time permanent basis to fulfil the position of Chief Financial Officer to
CanArgo Energy Corporation (“CanArgo”) reporting to the Chief Executive Officer
of CanArgo. The Company provides management services to CanArgo pursuant to the
terms of the Agreement for the Provision of Management Services dated 18th
February 2004 (“MSA”), as such agreement is amended or varied from time to time.
  1.2   The Employee’s principal duties as Chief Financial Officer shall be the
management and development of the central finance function within the CanArgo
group as set out in Appendix A hereto. Notwithstanding the foregoing, the
Employee accepts that he may be required to perform other duties and tasks
outwith the scope of his normal duties.   1.3   Whilst employed by the Company
the Employee must:       during his hours of work devote the whole of his time,
attention and abilities to the business of the Company and carry out his duties
with due care and attention;       not, without the Company’s prior written
consent, be in any way directly or indirectly engaged or concerned with any
other business or employment whether during or outside his hours of work for the
Company;       use his best efforts to promote and protect the interests of the
Company and observe the utmost good faith towards the Company; and       comply
with all the Company’s rules, regulations and policies from time to time in
force and any rules which the Company’s clients may require him to observe
whilst working on their premises.   2   Place of Work       The Employee’s place
of work will be at Suite 9/10, Borough House, Rue du Pre, St Peter Port,
Guernsey, Channel Islands or such other location within Guernsey as shall be
notified by the Company to the Employee from time to time. The Employee may be
required to travel and work at any of the premises of the Company or CanArgo as
may be required for the proper fulfilment of the Employee’s duties, including in
particular within the former Soviet Union. Wherever possible, the Employee will
be given reasonable notice of any change in his place of work.

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3   Pay   3.1   The Employee’s base salary shall be £120,000 per annum payable
monthly by bank transfer on or around the 15th day of each calendar month into
the bank account notified in writing by the Employee to the Company.   3.2   The
Employee’s base salary shall be subject to review annually at the discretion of
the Compensation Committee of CanArgo. The Company is not obliged to increase
the Employee’s base salary at such review.   4   Hours of Employment       The
Employee agrees that he shall work such hours as are necessary for the proper
performance of his duties. The Employee shall work a minimum of 140 hours per
month based upon an 8 hour day Monday to Friday (inclusive) between the hours of
8am and 6.00pm, with a break of one hour for lunch each day.   5   Overtime    
  The Employee will not receive additional remuneration for any hours worked
over and above the normal hours of work narrated in Clause 4.   6   Holidays  
6.1   The holiday year runs from 1st January until 31st December the same year.
Holidays can be taken only with the advance permission of the Chief Executive
Officer of CanArgo from time to time.   6.2   In addition to public and bank
holidays, the Employee is entitled to a maximum of 25 working days holiday every
calendar year. Such days holiday are accrued pro rata throughout the calendar
year, depending on the Employee’s length of service within that year. Holiday
entitlement will accrue per each month worked and will be rounded up to the
nearest whole day.   6.3   There is no facility to carry holidays forward from
one year to the next. However, except in exceptional circumstances, holidays not
taken in one calendar year may be carried forward to the following calendar year
provided they are taken within the first quarter and with the advance permission
of the Chief Executive Officer.   6.4   On leaving, holiday pay will be paid for
all entitlement accrued in the current holiday year but not taken at the time of
termination of employment. In the event of holidays being taken but not earned,
appropriate holiday pay will be deducted by the Company from the Employee’s
final payment, the Company’s authority to do so being evidenced by the
Employee’s signature to this Statement.   6.5   The Company may require the
Employee to take accrued holidays during any period of notice.   7   Expenses  
    The Employee will be reimbursed for any expenses properly incurred in
connection with his duties in accordance with the Company’s expenses policy as
amended from time to time.

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8   Notice   8.1   The Employment shall continue unless and until terminated at
any time by:   8.1.1   the Company giving the Employee not less than 3 months’
previous notice in writing to that effect; or   8.1.2   the Employee giving to
the Company not less than 3 months’ previous notice in writing to that effect.  
8.2   The Company shall be entitled, at its sole discretion, to terminate the
Employment in writing either instead of, or at any time after, notice of
termination being given (by either the Company or the Employee) and in either
case to make a payment to the Employee in lieu of notice.   8.3  
Notwithstanding Clauses 8.1 and 8.2, if the Employee is dismissed for gross
misconduct, he will receive no notice and no payment in lieu of notice.   9  
Other Insurance & Benefits   9.1   Life Assurance       The Company (through
CanArgo) will provide the Employee with the benefit of death in service life
assurance which, in the event of death itself will pay a maximum amount of 4
times his annual salary, subject to the rules and conditions of the policy.  
9.2   Health Care Scheme   9.2.1   The Company (through CanArgo) shall provide
the Employee with PPP Healthcare cover at the expense of the Company, always
subject to the terms and conditions of the PPP Healthcare scheme.   9.2.2   All
payments under the PPP Healthcare scheme or the like will be subject to any
deductions required by law.   9.1.3   The Company (through CanArgo) reserves the
right at its absolute discretion to terminate or amend at any time the PPP
Healthcare scheme or the Employee’s membership of any scheme. The Company
(through CanArgo) will provide an equivalent benefit unless, in the reasonable
opinion of the Company (through CanArgo), it is unable to secure membership for
the Employee due to the medical condition of the Employee.   9.3   PHI       The
Employee shall be entitled to participate in a Permanent Health Insurance
(“PHI”) scheme (through CanArgo), always subject to the terms and conditions of
the PHI scheme.   9.3.1   Payments       All payments under the PHI scheme or
the like will be subject to the deductions required by law.       Where payments
are made under the PHI scheme all other benefits provided to or in respect of
the Employee will cease from the start of those payments (if they have not done
so already), unless the Company is fully reimbursed by the PHI scheme for the
cost of providing the benefit.

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9.4   Right to terminate or amend       The Company reserves the right at its
absolute discretion to terminate or amend at any time any Health Care Scheme or
PHI scheme or the Employee’s membership of any such scheme. The Company will
provide an equivalent benefit unless, in the reasonable opinion of the Chief
Executive Officer, it is unable to secure insurance at reasonable premiums due
to the medical condition of the Employee or his spouse or children.   10  
Pension       The Company does not operate a company pension scheme. However,
the Company will pay a monthly contribution of 9% of the Employee’s base salary,
as outlined in Clause 3, to the Employee.   11   Grievance Procedures       If
the Employee wishes to obtain redress of any grievance relating to the
Employment or is dissatisfied with any reprimand, suspension or other
disciplinary step taken by the Company, he shall apply in writing to the Chief
Executive Officer, setting out the nature and details of any such grievance or
dissatisfaction.   12   Disciplinary Rules and Procedure       Any disciplinary
action taken in connection with the Employment will usually be taken in
accordance with the Company’s normal disciplinary procedure (which are workplace
rules and not contractually binding) a copy of which is available from the
Corporate Secretary of CanArgo.   13   Health and Safety   13.1   It is the
Company’s policy to comply with all statutory requirements arising from
legislation applicable to Guernsey prevailing at the time.   13.2   In addition,
the Company may at its discretion impose even more stringent health and safety
standards if it is considered that these may increase the safety and well being
of its employees. Any such additional requirements will be notified to the
Employee.   14   Sickness and Absence   14.1   If the Employee is absent from
work for any reason and the absence has not previously been authorised by the
Company, the Employee must notify a representative of Company at his place of
work by no later 10.00am on the first day of absence, of the reason for the
absence and the anticipated duration. Failure to do so may lead to disciplinary
action.   14.2   Should the absence extend beyond 7 days (including weekends) a
doctor’s certificate should be sent to the Company as soon as possible from the
eighth consecutive day of the absence. Thereafter medical certificates should be
provided to the Company to cover the full period of continuous absence. In these
circumstances, the Employee should not return to work until authorised by the
doctor.   14.3   Immediately following the Employee’s return to work after any
period of absence the Employee shall be required to complete and submit and
self-certification form available from his place of work.

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14.4   At its discretion, the Company may terminate the employment of the
Employee, after the agreed notice period, if it considers that the Employee’s
sickness record makes him unfit for regular full time work. The Company reserves
the right to require the Employee to undergo a medical examination conducted by
a doctor provided by the Company (at the Company’s expense).   14.5   If the
Employee’s absence is due to sickness or injury, the Company will pay any
Statutory Sick Pay (“SSP”) in accordance with any relevant statutory provisions
in Guernsey. For SSP purposes, qualifying days are Monday to Friday (inclusive).
  14.6   In addition, in the event of the Employee being absent from work due to
sickness or injury, the Company will pay sick pay as follows:

  (a)   During the first ten weeks of absence in any twelve month period, the
Employee shall be paid his base salary as outlined in Clause 3, less any SSP
paid to the Employee by the Company and less any other state sickness benefit
recoverable by the Employee;     (b)   For a further ten weeks of absence in the
same twelve month period, the Employee shall be paid one half of his base salary
as outlined in Clause 3, less any SSP paid to the Employee by the Company and
less any other state sickness benefit recoverable by the Employee;     (c)  
After a total of twenty weeks of absence in the same twelve month period, the
provisions of the sickness and disability insurance cover to be arranged by the
Company for the Employee shall apply.

15   Confidentiality   15.1   The Employee will during the employment and at all
times keep secret all trade secrets or other confidential technical or
commercial information which the Employee may obtain regarding the affairs of
either the Company or CanArgo including, in particular, names of its clients,
trade information relating to Company or CanArgo’s research and development,
engineering data, seismic data, surveys, specifications, process formulations,
production operations or techniques, planning, purchasing, accounting, finance,
selling, marketing, market research, promotional plans, customers, suppliers,
and all other information pertaining to the business of the Company or CanArgo
which is not publicly available. This restriction shall continue to apply after
the termination of the Employee’s employment without limit in point of time but
shall cease to apply to any such information which may come into the public
domain other than through unauthorised disclosure by the Employee.   15.2   The
Employee may not make, otherwise than for the benefit of the Company, any notes
or memoranda relating to any matter within the scope of the business of the
Company or CanArgo concerning any of its dealings or affairs nor shall the
Employee during the continuance of his employment or at any time after such
Employee has left the employment of the Company use or permit to be used any
such notes or memoranda. Any such documents made by the Employee shall be the
property of the Company or CanArgo and shall be left at its registered office
upon termination of the Employee’s employment with the Company and all copyright
in such notes or memoranda shall vest in the Company or CanArgo as appropriate.

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16   Data Protection       The Employee acknowledges and agrees that the Company
is permitted to hold personal information about the Employee as part of its
personnel and other business records and may use such information in the course
of the Company’s business. The Employee agrees that the Company may disclose
such information to third parties in the event that such disclosure is in the
Company’s view required for the proper conduct of the Company’s business or that
of CanArgo or any associated company. This clause applies to any information
held, used or disclosed in any medium.   17   Company and client Property      
All equipment (including computer equipment), notes, memoranda, records, lists
of customers, suppliers and employees, correspondence, computer and other discs
or tapes, data listings, codes, keys and passwords, designs, drawings and other
documents or material whatsoever (whether made or created by you or otherwise
and in whatever medium or format) relating to the business of the Company or
CanArgo or any of their clients (and any copies of the same) shall:   17.1.1.1  
be and remain the property of the Company or CanArgo or the relevant client; and
  17.1.1.2   be handed over by the Employee to the Company or CanArgo on demand
and in any event on the termination of his employment.   18   Governing Law and
Jurisdiction   18.1   This statement shall be governed and construed in
accordance with the law of Guernsey.   18.2   Each party hereby submits to the
non-exclusive jurisdiction of the Guernsey courts as regards any claim, dispute
or matter arising out of or in connection with this Agreement and its
implementation and effect.

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They are subscribed by the Company and signed for and on its behalf at
On                    the day of                     2005 Director
Director/Secretary
They are subscribed by the Employee in acknowledgement that he has received a
copy of this Statement and has read it or has had it explained by a member of
management and that he understands it.
At
On the                    day of                    2005
in the presence of
Signature of Witness
Signature of Employee
Full Name
Address

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Appendix A

     
(CANARGO LOGO) [u17673u1767349.gif]
   
 
  CanArgo Energy Corporation

                    Job Description
                    Chief Financial Officer (CFO)

Position:
Chief Financial Officer

Employed by:
Vazon Energy Limited, on behalf of

Reporting to:
Chief Executive Officer of CanArgo
CanArgo Energy Corporation (the “Company”), as an Officer of the Company

Location:
Guernsey, with occasional travel to Georgia and elsewhere

Specific Responsibilities:
Overall management of the Finance function of the Company. Specific
responsibilities in the area of financial and project accounting, management &
control include:
Accounting:

  1)   Assess overall accounting needs of the organization     2)   Provide
technical accounting services to the CanArgo group     3)   Monitor and ensure
corporate compliance with new accounting standards     4)   Manage monthly
payroll (all companies) and directors compensation

Finance:

  1)   Ensure that the company’s financial records are accurately maintained    
2)   Take responsibility for all financial functions including; A/P; A/R; Cash
Management; G/L; Reconciliations     3)   Supervise and review consolidated
financial statement preparation process     4)   Take responsibility for
quarterly and annual financial statements including management discussion and
analysis and notes thereto for inclusion in 10-Q and 10K and filing of same    
5)   Chief liaison with auditors during review of 10-Q, 10-K and SOX 404     6)
  Coordinate prospectus and other filing documents including liaison with legal
counsel, auditors, etc.     7)   Ensure compliance with SEC and OSE regulations
including filing of S-8’s, 8-K’s     8)   Proposals on corporate funding and
assistance with fund raising     9)   Monitor and ensure compliance with initial
and subsequent disbursement conditions of debt or other loans     10)   Liaise
with legal counsel, corporate secretary to ensure that corporate investments are
adequately protected/registered     11)   Prepare and maintain consolidated
budget and present to Board of Directors
    12)   Review quarterly cost recovery submissions under each Production
Sharing Contract

Treasury:

  1)   Monitor cash balances
    2)   Monitor and Advise on term deposit investment     3)   Liaise with
bank(s)     4)   Prepare and monitor letter of credit applications/status,
escrow accounts, etc.     5)   Prepare vendor credit applications

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  6)   Review and sign cheques/wires for all outgoing payments

Taxation:

  1)   Ensure compliance with applicable federal tax codes in US, Canada, UK,
Cyprus, Georgia and Kazakhstan     2)   Prepare or review annual corporate tax
filings in above jurisdictions
    3)   Prepare annual franchise tax or other corporate tax
filings/questionnaires     4)   Defend, if necessary, the corporation against
unfair or frivolous tax claims or positions     5)   Develop appropriate
corporate tax planning strategies

Internal Controls:

  1)   Implement adequate internal controls and procedures to optimize
resources, safeguard assets, prevent and detect fraud and maintain reliable
control systems     2)   Update and maintain Accounting Policy and Procedures
Manual     3)   Ensure compliance with Sarbanes Oxley and other relevant
legislation

Insurance:

  1)   Ensure the Company maintains adequate insurance coverage for existing
group assets     2)   Assess or add coverage for new activities, assets     3)  
Review annual insurance and other corporate practice applications     4)  
Supervise preparation and follow-up of insurance claims

Job Description:
This position is responsible for the overall financial management of the Company
with the objectives of ensuring finance is available for agreed programmes,
maintaining tight financial control of the business and ensuring financial
reporting to the Company’s regulatory bodies is complied with in full. The
position is based in Guernsey, but will require some travel (particularly at the
beginning) to the Company’s operating areas and more generally. The main finance
function is based in Guernsey but as most expenditure and all income is
currently received from Georgia, this position will be responsible for the
overall finance function in Georgia, either directly, or indirectly through the
Company’s Georgian operating companies. As a senior officer of the Company this
position will work closely with the CEO, COO and Corporate Secretary, and will
be involved in discussions on overall corporate strategy, financing etc. The
position will be expected to present to the Board of Directors of the Company,
and to the Company’s Audit Committee.
Date: May 2005

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