ex10_52.htm


    

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      Exhibit
        10.52

       

      FAR
        EAST ENERGY CORPORATION

       

      NON-QUALIFIED
        STOCK OPTION AGREEMENT

       

      FOR
        GOOD
        AND VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, Far
        East
        Energy Corporation (the "Company"), a Nevada corporation, hereby grants
        to William A. Anderson (the "Option Holder"), the option to purchase
        shares of the common stock, $0.001 par value per share, of the Company
        ("Shares"), upon the terms set forth in this stock option agreement (this
        "Agreement"):

      WHEREAS,
        the Option Holder has been granted the following award in connection with
        his or
        her retention to provide services to the Company;

      NOW,
        THEREFORE, in consideration of the premises and mutual covenants contained
        herein, the parties hereto agree as follows.

      1.           Grant.  The
        Option Holder is hereby granted an option (the "Option") to purchase
        210,000 Shares (the "Option Shares").  The Option is granted as
        of October 1, 2007 (the "Date of Grant").  This Option shall
        not be treated as an "incentive stock option" as defined in Section 422 of
        the
        Internal Revenue Code of 1986, as amended (the "Code").

      2.           Status
        of Option Shares.  The Option Shares shall upon issue rank equally
        in all respects with the other Shares.

      3.           Option
        Price.  The purchase price for the Option Shares shall be, except
        as herein provided, $1.05 per Option Share, hereinafter sometimes referred
        to as
        the "Option Price," payable immediately in full upon the exercise of the
        Option.

      4.           Term
        of Option.  The Option may be exercised only during the period
        (the "Option Period") set forth in Section 6 below and shall
        remain exercisable until the tenth anniversary of the Date of
        Grant.  Thereafter, the Option Holder shall cease to have any rights
        in respect thereof.

      5.           Exercisability.  Subject
        to the Option Holder's continued service with the Company and the terms and
        conditions of this Agreement, the Option will vest and become exercisable
        with
        respect to 25% of the Option Shares on the Date of Grant and with respect
        to an
        additional 25% of the Option Shares on each of the first, second and third
        anniversaries of the Date of Grant, so that the Option will be 100% vested
        and
        exercisable after the third anniversary of the Date of Grant, as set forth
        in
        the following schedule:

      


      
        	
                Timeframe
                  from Date of Grant

                (Vesting
                  Date)

              	 	
                 

                Vesting

              	 	
                 

                Cumulative
                  Vesting

              
	
                October
                  1, 2007 (Date of Grant)

              	 	
                25%

              	 	
                25%

              
	
                October
                  1, 2008 (1 year)

              	 	
                25%

              	 	
                50%

              
	
                October
                  1, 2009 (2 years)

              	 	
                25%

              	 	
                75%

              
	
                October
                  1, 2010 (3 years)

              	 	
                25%

              	 	
                100%

              


      

       

      6.           Exercise
        of Option.  The Option may be exercised for all, or from time to
        time any part, of the Option Shares for which it is then
        exercisable.  The exercise date shall be the date the Company receives
        a written notice of exercise signed by the Option Holder, specifying the
        whole
        number of Option Shares in respect of which the Option is being exercised,
        accompanied by (a) full payment for the Option Shares with respect to which
        the
        Option is exercised, in a manner acceptable to the Company (which, at the
        discretion of the Company, shall include a broker assisted exercise
        arrangement), of the Option Price for the Option Shares for which the Option
        is
        being exercised and (b) payment by the Option Holder of all payroll, withholding
        or income taxes incurred in connection with the Option exercise (or arrangements
        for the collection or payment of such tax satisfactory to the Compensation
        Committee of the Board of Directors of the Company (or if there is no such
        committee, then the Board of Directors of the Company) (the "Committee")
        are made).  The purchase price for the Shares as to which the Option
        is exercised shall be paid to the Company in full at the time of exercise
        at the
        election of the Option Holder (i) in cash, (ii) in Shares having a Fair Market
        Value (as defined below) equal to the aggregate Option Price for the Shares
        being purchased and satisfying such other requirements as may be imposed
        by the
        Committee; provided, that, such Shares have been held by the
        Option Holder for no less than six months, (iii) partly in cash and partly
        in
        such Shares, or (iv) through the delivery of irrevocable instructions to
        a
        broker to deliver promptly to the Company an amount equal to the aggregate
        Option Price for the Shares being purchased.  Anything to the contrary
        herein notwithstanding, the Company shall not be obligated to issue any Option
        Shares hereunder if the issuance of the Option Shares would violate the
        provision of any applicable law, in which event the

       


      
        
          
          

        

        
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      Company
        shall, as soon as practicable, take whatever action it reasonably can so
        that
        the Option Shares may be issued without resulting in such violations of
        law.

       

      For
        purposes of this Agreement, "Fair Market Value" shall mean, on a given
        date, the arithmetic mean of the high and low prices of the Shares as reported
        on such date on the Composite Tape of the principal national securities exchange
        on which such Shares are listed or admitted to trading, or, if no Composite
        Tape
        exists for such national securities exchange on such date, then on the principal
        national securities exchange on which such Shares are listed or admitted
        to
        trading, or, if the Shares are not listed or admitted on a national securities
        exchange, the arithmetic mean of the per Share closing bid price and per
        Share
        closing asked price on such date as quoted on the National Association of
        Securities Dealers Automated Quotation System (or such market in which such
        prices are regularly quoted), or, if there is no market on which the Shares
        are
        regularly quoted, the Fair Market Value shall be the value established by
        the
        Committee in good faith. If no sale of Shares shall have been reported on
        such
        Composite Tape or such national securities exchange on such date or quoted
        on
        the National Association of Securities Dealers Automated Quotation System
        on
        such date, then the immediately preceding date on which sales of the Shares
        have
        been so reported or quoted shall be used.

      7.           Exercisability
        Upon Termination of Service by Death or Disability.  Upon a
        Termination of Service (as defined below) by reason of death or Disability
        (as
        defined below), the Option may be exercised within 180 days following the
        date
        of death or Termination of Service due to Disability (subject to any earlier
        termination of the Option as provided herein), by the Option Holder in the
        case
        of Disability, or in the case of death, by the Option Holder's estate or
        by a
        person who acquired the right to exercise the Option by bequest or inheritance,
        but in any case only to the extent the Option Holder was entitled to exercise
        the Option on the date of his or her Termination of Service by death or
        Disability.  To the extent that the Option Holder was not entitled to
        exercise the Option at the date of his or her Termination of Service by death
        or
        Disability, or if he or she does not exercise the Option (which he or she
        was
        entitled to exercise) within the time specified herein, the Option shall
        terminate.  Notwithstanding anything to the contrary herein, the
        Committee may at any time and from time to time prior to the termination
        of the
        Option, with the consent of the Option Holder, extend the period of time
        during
        which the Option Holder may exercise his or her Option following the date
        of
        Termination of Service due to death or Disability; provided,
however, that the maximum period of time during which the Option
        shall be
        exercisable following the date of Termination of Service due to death or
        Disability shall not exceed the original term of the Option and that
        notwithstanding any extension of time during which the Option may be exercised,
        the Option, unless otherwise amended by the Committee, shall only be exercisable
        to the extent the Option Holder was entitled to exercise the Option on the
        date
        of Termination of Service due to death or Disability.  Any such
        extension shall be designed to conform to the requirements of Section 409A
        of the Code so as to avoid the imposition of the additional income
        tax.  For purposes of this Agreement, "Termination of Service"
        shall mean a Option Holder's termination of service with the Company, its
        Subsidiaries (as defined in Section 424(f) of the Code or any successor section
        thereto) and Affiliates (as defined below). A Termination of Service of an
        employee of the Company or any Subsidiary shall not be deemed to have occurred
        in the case of sick leave, military leave or any other leave of absence,
        in each
        case approved by the Committee or in the case of transfers between locations
        of
        the Company or its Subsidiaries. In the case of "specified employees" (as
        described in Section 409A of the Code), distributions may not be made
        before the date which is six months after the date of termination of service
        (or, if earlier, the date of death of the Option Holder). A specified employee
        is a "key employee" as defined in Section 416(i) of the Code without regard
        to
        Paragraph (5), but only if the Company has any stock which is publicly traded
        on
        an established securities market or otherwise.  For purposes of this
        Agreement, "Disability" shall mean inability to engage in any substantial
        gainful activity by reason of a medically determinable physical or mental
        impairment which can be expected to result in death, or can be expected to
        last
        for a continuous period of not less than 12 months. The determination
        whether the Option Holder has suffered a Disability shall be made by the
        Committee based upon such evidence as it deems necessary and appropriate.
        An
        Option Holder shall not be considered disabled unless he or she furnishes
        such
        medical or other evidence of the existence of the Disability as the Committee,
        in its sole discretion, may require. For purposes of this Agreement, "Affiliate"
        shall mean any entity (i) 20% or more the voting equity of which is owned
        or
        controlled directly or indirectly by the Company, or (ii) that had been a
        business, division or subsidiary of the Company, the equity of which has
        been
        distributed to the Company's stockholders, even if the Company thereafter
        owns
        less than 20% of the voting equity.

      8.           Effect
        of Other Termination of Service.  Upon a Termination of Service
        for any reason (other than death or Disability), the unexercised Option may
        thereafter be exercised during the period ending 90 days after the date of
        such
        Termination of Service, but only to the extent to which the Option was vested
        and exercisable at the time of such Termination of
        Service.  Notwithstanding the foregoing, the Committee may, in its
        sole discretion, either by prior written agreement with the Option Holder
        or
        upon the occurrence of a Termination of Service, accelerate the vesting of
        unvested Options held by the Option Holder if the Option Holder's Termination
        of
        Service is without "cause" (as such term is defined by the Committee in its
        sole
        discretion) by the Company.

      9.           Effect
        of Change of Control.  Subject to the terms of this Section
        9 and the other terms of this Agreement, if, upon or within 24 months
        following the occurrence of a Change of Control (as defined below), a
        Termination of Service of the

       

      
        
          
          

        

        
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      Option
        Holder
        occurs in the Option Holder's capacity as a director of the Company, then
        the
        unvested Option Shares subject to the Option shall become immediately vested
        in
        full on the date of such Termination of Service.

       

      For
        purposes of this Agreement,
        "Change of Control" shall mean the occurrence of any of the following
        events:

       

      (i) any
        Person (as used for purposes of Section 13(d)(3) or 14(d)(2) of the Securities
        Exchange Act of 1934, as amended (or any successor rule thereto)) becomes
        the
        Beneficial Owner (as defined in Rule 13d-3 under the Securities Exchange
        Act of
        1934, as amended (or any successor rule thereto)), directly or indirectly,
        of
        more than forty percent (40%) of 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 the following acquisitions shall not
        constitute a Change of Control: (A) any acquisition by any employee benefit
        plan (or related trust) sponsored or maintained by the Company or any
        corporation controlled by the Company, or (B) any acquisition by an entity
        pursuant to a reorganization, merger or consolidation, unless such
        reorganization, merger or consolidation constitutes a Change of Control under
        clause (ii) of this Section 9;

       

      (ii) the
        consummation of a reorganization, merger or consolidation, unless following
        such
        reorganization, merger or consolidation sixty percent (60%) or more of the
        combined voting power of the then-outstanding voting securities of the entity
        resulting from such reorganization, merger or consolidation entitled to vote
        generally in the election of directors is then Beneficially Owned, directly
        or
        indirectly, by all or substantially all of the individuals and entities who
        were
        the Beneficial Owners, respectively, of the Outstanding Company Voting
        Securities immediately prior to such reorganization, merger or
        consolidation;

       

      (iii) the
        (i) approval by the stockholders of the Company of a complete liquidation
        or dissolution of the Company or (ii) sale or other disposition (in one
        transaction or a series of related transactions) of all or substantially
        all of
        the assets of the Company and its Subsidiaries, unless the successor entity
        existing immediately after such sale or disposition is then Beneficially
        Owned,
        directly or indirectly, by all or substantially all of the individuals and
        entities who were the Beneficial Owners, respectively, of the Outstanding
        Company Voting Securities immediately prior to such sale or
        disposition;

       

      (iv) during
        any period of twenty-four months, individuals who at the beginning of such
        period constitute the Board of Directors of the Company (the "Board"),
        and any new director (other than (A) a director nominated by a Person who
        has entered into an agreement with the Company to effect a transaction described
        in clauses (i), (ii) or (iii) of this Sections 9,
        (B) a director whose initial assumption of office occurs as a result of
        either an actual or threatened election contest subject to Rule 14a-11 of
        Regulation 14A promulgated under the Securities Exchange Act of 1934, as
        amended (or any successor rule thereto), or other actual or threatened
        solicitation of proxies or consents by or on behalf of a Person other than
        the
        Board or (C) a director designated by any Person who is the Beneficial
        Owner, directly or indirectly, of securities of the Company representing
        10% or
        more of the Outstanding Company Voting Securities) whose election by the
        Board
        or nomination for election by the Company¡ ̄s stockholders was approved in
        advance by a vote of at least two-thirds (2/3) of the directors then still
        in
        office who either were directors at the beginning of the period or whose
        election or nomination for election was previously so approved, cease for
        any
        reason to constitute at least a majority thereof; or

       

      (v) the
        Board adopts a resolution to the effect that, for purposes hereof, a Change
        of
        Control has occurred.

       

      
                    Notwithstanding
          the
          foregoing, if the award under this Agreement consists of deferred compensation
          subject to Section 409A of the Code, the definition of Change of Control
          shall be deemed modified to the extent necessary to comply with
          Section 409A of the Code.

      

       

      10.     Adjustment
        Upon Certain Events.

       

      (i)
        The
        number and type of Shares which have been authorized for issuance under this
        Agreement as well as the exercise or purchase price per Share, as applicable,
        covered by this Agreement, shall be proportionately adjusted for any increase
        or
        decrease in the number of issued Shares resulting from a stock split, reverse
        stock split or combination or the payment of a stock dividend (but only on
        the
        Company¡ ̄s common stock) or reclassification of the Company¡ ̄s common stock or
        any other increase or decrease in the number of issued Shares effected without
        receipt of consideration by the Company. Any such adjustment shall be determined
        in good faith by the Committee to be appropriate in order to prevent dilution
        or
        enlargement of the benefits or potential benefits intended to be made available
        under this Agreement, and the Committee¡ ̄s determination in that respect shall
        be final, binding and conclusive. Except as expressly provided herein, no
        issue
        by the Company of shares of stock of any class, or securities convertible
        into
        shares of stock of any class, shall affect, and no adjustment by reason thereof
        shall be made with respect to, the number or price of Shares subject to this
        Agreement.

       


      
        
          
          

        

        
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      (ii)
        In
        the event of a Change of Control (other than pursuant to Section 11 or
12), if the Committee makes no provision for the assumption
        of this
        Agreement by the successor corporation, then the Committee shall determine
        whether (i) none, all or a portion of the Option shall vest, (ii) the
        Option shall terminate as of a date fixed by the Committee which is at least
        30 days after the notice thereof to the Option Holder and shall give each
        Option Holder the right to exercise his or her Option as to all or any part
        of
        the Shares, including Shares as to which the Option would not otherwise be
        exercisable, or (iii) cause the Option, as of the effective date of any
        such event, to be cancelled in consideration of a cash payment or grant of
        an
        alternative option or award (whether by the Company or any entity that is
        a
        party to the transaction), or a combination thereof, to the holder of the
        cancelled Option, providedthat such payment and/or grant are
        substantially equivalent in value to the fair market value of the cancelled
        Option as determined by the Committee.

       

      11.          
        Liquidation.  In the event of the dissolution or liquidation of
        the Company, other than pursuant to Section 12 in connection with a
        Reorganization (as defined below), the Option shall terminate as of a date
        to be
        fixed by the Committee, provided that not less than 30 days written notice
        of
        the date so fixed shall be given to the Option Holder and the Option Holder
        shall have the right during such period to exercise the Option as to all
        or any
        part of the Option Shares covered hereby as to which the Option would then
        be
        exercisable.

          12.          
        Reorganization.  In the event of a Reorganization in which the
        Company is not the surviving or acquiring company, or in which the Company
        is or
        becomes a wholly-owned subsidiary of another company or entity after the
        effective date of the Reorganization, then (i) if there is no plan or
        agreement respecting the Reorganization ("Reorganization Agreement") or
        if the Reorganization Agreement does not specifically provide for the change,
        conversion or exchange of the Option Shares under outstanding unexercised
        Options for securities of another corporation, then the Option shall terminate
        as of a date to be fixed by the Committee, provided that not less than
        30 days written notice of the date so fixed shall be given to the Option
        Holder and the Option Holder shall have the right during such period to exercise
        the Option as to all or any part of the Option Shares covered hereby; or
        (ii) if there is a Reorganization Agreement and if the Reorganization
        Agreement specifically provides for the change, conversion or exchange of
        the
        Option Shares under outstanding or unexercised options for securities, cash
        or
        property of another corporation or entity, then the Committee shall adjust
        the
        Option Shares under such outstanding unexercised Options (and shall adjust
        the
        Option Shares which are then available to be optioned, if the Reorganization
        Agreement makes specific provisions therefor) in a manner not inconsistent
        with
        the provisions of the Reorganization Agreement for the adjustment, change,
        conversion or exchange of such stock and such options.  The term
        "Reorganization" as used in this Section 12 shall mean any merger,
        consolidation, sale of all or substantially all of the assets of the Company,
        or
        sale, pursuant to an agreement with the Company, of securities of the Company
        pursuant to which the Company is or becomes a wholly-owned subsidiary of
        another
        company or entity after the effective date of the Reorganization

             
        13.           Lock Up
        Agreement.  The Option Holder agrees that upon request of the
        Company or the underwriters managing any underwritten offering of the Company's
        securities, the Option Holder shall agree in writing that for a period of
        time
        (not to exceed 180 days) from the effective date of any registration of
        securities of the Company, the Option Holder will not sell, make any short
        sale
        of, loan, grant any option for the purchase of, or otherwise dispose of any
        Option Shares issued pursuant to the exercise of the Option, without the
        prior
        written consent of the Company or such underwriters, as the case may
        be.

             
        14.          Transfer of
        Shares.  The Option, the Option Shares, or any interest in either,
        may be sold, assigned, pledged, hypothecated, encumbered, or transferred
        or
        disposed of in any other manner, in whole or in part, only in compliance
        with
        the terms, conditions and restrictions as set forth in the governing instruments
        of the Company, applicable United States federal and state securities laws
        and
        the terms and conditions this Agreement.  Except as set forth in this
Section 14, the Option shall not be transferable by the Option Holder
        otherwise than by will or by the laws of descent and distribution, and during
        the lifetime of the Option Holder the Option shall be exercisable only by
        the
        Option Holder.  If the Option is exercisable after the death of the
        Option Holder or a transferee pursuant to the following sentence, the Option
        may
        be exercised by the legatees, personal representatives or distributees of
        the
        Option Holder or such transferee. The Option Holder may irrevocable transfer
        the
        Option for no consideration to any child, stepchild, grandchild, parent,
        stepparent, grandparent, spouse, former spouse, sibling, niece, nephew,
        mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law
        or
        sister-in-law, including adoptive relationships, of the Option Holder, any
        trust
        in which these persons have more than 50% of the beneficial interest, any
        foundation in which these persons (or the Option Holder) control the management
        of assets, and any other entity in which these persons (or the Option Holder)
        own more than 50% of the voting interests ("Eligible Transferees"),
providedthat subsequent transfers of transferred Options shall
        be
        prohibited except those in accordance with the first sentence of this
        Section 14. The Committee may, in its discretion, amend the definition of
        Eligible Transferees to conform to the coverage rules of Form S-8 under the
        Securities Act of 1933 (or any comparable or successor registration statement)
        from time to time in effect. Following transfer, any such Options shall continue
        to be subject to the same terms and conditions as were applicable immediately
        prior to transfer. The events of Termination of Service of Section 8
        hereof shall continue to be applied with respect to the original Option Holder,
        following which the options shall be exercisable by the transferee only to
        the
        extent, and


      
        
          
          

        

        
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      for
        the
        periods specified, in Section 8.

      15.           
        Expenses of Issuance of Option Shares.  The issuance of stock
        certificates upon the exercise of the Option in whole or in part, shall be
        without charge to the Option Holder.  The Company shall pay, and
        indemnify the Option Holder from and against any issuance, stamp or documentary
        taxes (other than transfer taxes) or charges imposed by any governmental
        body,
        agency or official (other than income taxes) by reason of the exercise of
        the
        Option in whole or in part or the resulting issuance of the Option
        Shares.

      16.           
        Withholding.  No later than the date of transfer of the Shares
        pursuant to the exercise of the Option granted hereunder (and in any event
        no
        later than three days after Option exercise), the Option Holder shall pay
        to the
        Company or make arrangements satisfactory to the Committee regarding payment
        of
        any federal, state or local taxes of any kind required by law to be withheld
        upon the exercise of the Option and the Company shall, to the extent permitted
        or required by law, have the right to deduct from any payment of any kind
        otherwise due to the Option Holder, federal, state and local taxes of any
        kind
        required by law to be withheld upon the exercise of the Option. With the
        approval of the Committee, the Option Holder may elect to pay a portion or
        all
        of such withholding taxes by (i) delivery of Shares or (ii) having
        Shares withheld by the Company from any Shares that would have otherwise
        been
        received by the Option Holder. The number of Shares so delivered or withheld
        shall have an aggregate Fair Market Value on the date of the exercise sufficient
        to satisfy the applicable withholding taxes. In addition, with the approval
        of
        the Committee, the Option Holder may satisfy any additional tax that the
        Option
        Holder elects to have the Company withhold by delivering to the Company or
        its
        designated representative Shares already owned by the Option Holder or, in
        the
        case of Shares acquired through an employee benefit plan sponsored by the
        Company or its Subsidiaries, Shares held by the Option Holder for more than
        six
        months.

      17.           
        No Right to Continued Employment of Service.  This Agreement
        shall not impose any obligation on the Company, its Subsidiaries or its
        affiliates to continue the service of the Option Holder or lessen the
        Company¡ ̄s, Subsidiary¡ ̄s or affiliate¡ ̄s right to terminate the service of the
        Option Holder.

      18.           
        Not Compensation for Benefit Plans.  This Agreement shall be
        deemed salary or compensation for the purpose of computing benefits under
        any
        benefit plan or other arrangement of the Company for the benefit of its
        employees or directors unless the Company shall determine
        otherwise.

      19.           
        No Rights to Awards; No Stockholder Rights.  No Option Holder
        shall have any claim to be granted any Option, and there is no obligation
        for
        uniformity of treatment of Option Holders. No Award shall confer on the Option
        Holder any rights to dividends or other rights of a stockholder with respect
        to
        Shares subject to this Agreement unless and until Shares are duly issued
        or
        transferred to the Option Holder in accordance with the terms of this Agreement
        and, if applicable, the satisfaction of any other conditions imposed by the
        Committee.

      20.           
        No Fractional Shares.  No fractional Shares shall be issued or
        delivered pursuant to this Agreement. The Committee shall determine, in its
        discretion, whether cash, other options, stock appreciation rights or other
        stock based awards, scrip certificates (which shall be in a form and have
        such
        terms and conditions as the Committee in its discretion shall prescribe)
        or
        other property shall be issued or paid in lieu of such fractional Shares
        or
        whether such fractional Shares or any rights thereto shall be forfeited or
        otherwise eliminated.

      21.           
        Severability.  The
        provisions of this
        Agreement shall be deemed severable, and the invalidity or unenforceability
        of
        any one or more of the provisions hereof shall not affect the validity and
        enforceability of the other provisions hereof.  The Option Holder
        agrees that the breach or alleged breach by the Company of (a) any covenant
        contained in another agreement (if any) between the Company and the Option
        Holder or (b) any obligation owed to the Option Holder by the Company, shall
        not
        affect the validity or enforceability of the covenants and agreements of
        the
        Option Holder set forth herein.

      22.           
        References.  References herein to rights and obligations of the
        Option Holder shall apply, where appropriate, to the Option Holder's legal
        representative or estate without regard to whether specific reference to
        such
        legal representative or estate is contained in a particular provision of
        this
        Option.

             23.    
        Headings.  The headings and other captions in this
        Agreement are for convenience of reference only and shall not be used in
        interpreting, construing or enforcing any of the provisions of this
        Agreement.

            
        24.            
Notices.  Any notice required or permitted to be given under
        this Agreement shall be in writing and shall be deemed to have been given
        when
        delivered personally or by courier, or sent by certified or registered mail,
        postage prepaid, return receipt requested, duly addressed to the party concerned
        at the address indicated below or to such changed address as such party may
        subsequently by similar process give notice of:

      If
        to the
        Company:

      Far
        East
        Energy Corporation

      363
        N Sam
        Houston Parkway East

      Suite
        380

      Houston,
        Texas 77060

      Attn.:
        Secretary

      If
        to the
        Option Holder:

      William
        A. Anderson

      c/o
        363 N
        Sam Houston Parkway East

      Suite
        380

      Houston,
        Texas 77060

      


      25.           Governing
        Law.  This Agreement shall be governed by and construed in
        accordance with the laws of the State of Texas applicable to contracts made
        and
        to be performed in the State of Texas without regard to conflict of laws
        principles.

      26.           Entire
        Agreement.  This Agreement constitutes the entire agreement among
        the parties relating to the subject matter hereof, and any previous agreement
        or
        understanding among the parties with respect thereto is superseded by this
        Agreement.

      27.           Modifications.  No
        change or modification, other than adjustment of the exercise or purchase
        price
        or the number of shares of common stock purchasable pursuant to this Agreement,
        of this Agreement shall be valid unless the same is in writing and signed
        by the
        parties hereto; provided, however that the Option Holder hereby covenants
        and
        agrees to execute any amendment of this Agreement which shall be required
        or
        desirable (in the opinion of the Company or its counsel) in order to comply
        with
        any rule or regulation promulgated or proposed under the Code.

      28.           Counterparts.  This
        Agreement may be executed in two counterparts, each of which shall constitute
        one and the same instrument.

             
        29.          Conflict.  To
        the extent the provisions of this Agreement conflicts with the terms and
        conditions of any written agreement between the Company and the Option Holder,
        the terms and conditions of such agreement shall control.

      


      IN
        WITNESS WHEREOF, the undersigned
        have executed this Agreement effective as of the Date of Grant.

      


       

      FAR
        EAST
        ENERGY CORPORATION

       

      

        
          	
                  By:

                	
                  /s/
                    Michael R. McElwrath

                
	
                  Name:

                	
                  Michael
                    R. McElwrath

                
	
                  Title:

                	
                  Chief
                    Executive Officer

                
	 	 
	 	 
	 	 
	
                  /s/
                    William A. Anderson

                
	
                  William
                    A. Anderson