ex10_73.htm


    
      

    

    Exhibit
10.73

    


     

    FAR
EAST ENERGY CORPORATION

     

    FORM
OF 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 ______________ (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, and the following terms
reflect the Company's 2005 Stock Incentive Plan (the "Plan");

     

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

     

     

    1.      Defined Terms;
Plan.  Terms used but not defined herein shall have the same
meaning ascribed to such terms in the Plan.  This Agreement and the
grant herein is subject to the terms and conditions herein and the terms and
conditions of the applicable provisions of the Plan, the terms of which are
incorporated herein by reference.

     

    2.      Grant.  The
Option Holder is hereby granted an option (the "Option") to purchase
___________ Shares (the "Option Shares")
pursuant to the Plan.  The Option is granted as of ____________ (the
"Date of
Grant").  This Option shall not be treated as an "incentive
stock option" as defined in Section 422 of the Code.

     

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

     

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

     

    5.      Term of
Option.  The Option may be exercised only during the period
(the "Option
Period") set forth in Section 7 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.

     

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


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    
      
        
          	
                  Timeframe
      from Date of Grant

                  (Vesting
      Date)

                	 
      	
                   

                  Vesting

                	 
      	
                   

                  Cumulative
      Vesting

                
	
                  __________,
      20__ (1 year)

                	 
      	
                  %

                	 
      	
                  %

                
	
                  __________,
      20__ (2 years)

                	 
      	
                  %

                	 
      	
                  %

                
	
                  __________,
      20__ (3 years)

                	 
      	
                  %

                	 
      	
                  %

                
	
                  __________,
      20__ (4 years)

                	 
      	
                  %

                	 
      	
                  %

                
	
                  __________,
      20__ (5 years)

                	 
      	
                  %

                	 
      	
                  %

                


        

      

    

    ______________________________________________________________________________

    


     

    7.      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 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 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 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.

     

    8.      Exercisability Upon
Termination of Service by Death or Disability.  Upon a
Termination of Service by reason of death or Disability, 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.


    
      
         


      

      
        2

        
          

        

      

      
         


      

    

     

    9.      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 (subject to any earlier termination of the Option as provided herein),
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.

    


    10.    Effect of Change of
Control.  Subject to the terms of this Section 10 and the
other terms of this Agreement, if, upon or within 24 months following the
occurrence of a Change of Control, [a Termination of Service of the Holder in
his capacity as a director of the Company occurs][the Holder's employment with
the Company and its subsidiaries is terminated without Cause], 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 Section 10, "Cause"
shall mean (i) your gross and willful misappropriation or theft of the Company's
or any of its subsidiary's funds or property; (ii) your conviction of, or plea
of guilty or nolo contendere to, any felony or crime involving dishonesty or
moral turpitude; or (iii) your complete and total abandonment of employment
duties at the Company for a period of thirty consecutive days (other than for
reason of Disability).]

    


    11.    Liquidation.  In
the event of the dissolution or liquidation of the Company, other than pursuant
to Section 12
in connection with a Reorganization, 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.


    
      
         


      

      
        3

        
          

        

      

      
         


      

    

     

    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 and the Plan.

     

    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 in any manner permitted by the terms of the Plan
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.

     

    17.    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.

     

    18.    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

                                  
	 
      	 
      	
                                     

                                  	 
      
	 
      	 
      	
                                     

                                  	 
      
	 
      	 
      	
                                    Attn.:
      Secretary

                                  	 
      
	 
      	 
      	 
      	 
      
	 
      	
                                    If
      to the Option Holder:

                                  	 
      
	 	 	 
	 
      	 
      	
                                     

                                  	 
      
	 
      	 
      	
                                     

                                  	 
      
	 
      	 
      	
                                     

                                  	 
      


                          

                        

                      

                    

                  

                

              

            

          

        

      

    


    
      
         


      

      
        4

        
          

        

      

      
         


      

    

     

    19.    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.

     

    20.    Entire
Agreement.  This Agreement and the Plan constitute 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 and the Plan.

     

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

    


    22.    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 as of the Date of
Grant.

    


    
      
        
          
            
              
                
                  	 
      	
                          FAR
      EAST ENERGY CORPORATION

                        	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                          By:

                        	 
      	 
      
	 
      	 
      	
                          Name:

                        	 
      	 
      
	 
      	 
      	
                          Title:

                        	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                          [NAME]

                        	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                          [name]

                        	 
      


                

              

            

          

        

      

    

     

     

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