Document:

Gross Overriding Royalty Agreement

    
      

    

    Exhibit 10.57

    
 

    GROSS
      OVERRIDING ROYALTY AGREEMENT

    

    

    THIS
      DEED is
      made
      this ________ day of December 2006

    

    

    

    BETWEEN

    

    

    (1) BALTIC
      PETROLEUM (E&P) LIMITED,
      a
      company incorporated in England under company number 05303991 and whose
      registered office is at 6-8 Underwood Street, London N1 7JQ, United Kingdom
      (“Grantee”);
      and

    

    (2)
      OOO ZAURALNEFTEGAZ,
      a
      limited liability company incorporated under the laws of the Russian Federation
      under the main state registration number (ORGN) 1024500513950, located at 27
      Lenin Street, Kurgan, 640000, Kurgan Oblast, Russian Federation (“Grantor”).

    

    

    

    WHEREAS

    

    

    (A)   The
      Grantee is a 50% shareholder
      in Zauralneftegaz Limited (“ZL”),
      a
      company incorporated in England under company number and incorporated in England
      under company number 05525360 whose registered office is at 6-8 Underwood
      Street, London N1 7JQ, United Kingdom. Siberian Energy Group Inc (“SEG”),
      a
      corporation incorporated under the laws of the State of Nevada, United States
      and whose principal place of business is at 275 Madison Avenue, 6th
      Floor,
      New York, NY 10016, United States is the other 50% shareholder in ZL .

    

    (B)   ZL
      owns all of the
      participatory interests in the Grantor. The Grantor has entered into a loan
      agreement dated 9th
      November
      2005 with Caspian Finance Limited (“CF”)
      a
      company incorporated in England and Wales under company number 05530897 and
      whose registered office is at Millennium Bridge House, 2 Lambeth Hill, London
      EC4V 2AJ United Kingdom, which is an associated company of the
      Grantee.

    

    (C)   On
      26th
      July
      2006 the Grantee entered into a deed with SEG and ZL relating to the possibility
      of additional loans being made to the Grantee by CF and of the Grantee entering
      a GOR Agreement with the Grantor as a condition of the same.

    

    (D)   CF
      and the Grantee are on
      this day entering into a new loan agreement in relation to the loans detailed
      in
      recital (C) above and accordingly the Grantor is entering into this GOR
      Agreement in favour of the Grantee on the terms hereinafter appearing.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

         

      

    

    
 

    NOW
      THEREFORE THIS AGREEMENT WITNESSES
      as
      follows:

    

    
      	
              1.

            	
              Definitions

            

    

    

    
      	 	
              In
                this Agreement, unless the context otherwise
                requires:

            

    

    

     

    
      	 	
              1.1

            	
              “Acreage”
                means the lands more particularly described in the Schedule attached
                hereto, in which the Grantor holds any right or interest and includes
                the
                Petroleum Substances which, upon or under such lands, together with
                the
                right to explore for and recover same insofar as such rights are
                granted
                by the Documents;

            

    

     

    
      	 	
              1.2

            	
              “Documents”
                means the Oil, Petroleum Substances and/or Gas Licences, leases,
                farmouts,
                options or other agreements to which the Grantor is or becomes a
                party,
                including any extensions or renewals thereof and any new grant acquired
                in
                addition to the Licences or pertaining to the
                Acreage;

            

    

     

    
      	 	
              1.3

            	
              “Gas”
                means and refers to all natural gas produced from the premises (including
                casinghead gas) and all of its constituent elements, including but
                not
                limited to sulphur contained in the gas, and natural gasoline, condensate,
                distillate, butanes, propanes, and other hydrocarbons condensed,
                absorbed,
                or separated out of or from the gas after it leaves the lease, including
                without limitation casinghead gas and flared or vented
                gas;

            

    

     

    
      	 	
              1.4

            	
              “Licence(s)”
                means the exploration licences in the Kurgan region of the Russian
                Federation held by the Grantor at the Acreage (as more particularly
                detailed in the Schedule) and including any other licences obtained
                by the
                Grantor;

            

    

     

    
      	 	
              1.5

            	
              “Oil”
                means and refers to any hydrocarbons produced from the premises,
                regardless of gravity, capable of being produced in liquid form at
                the
                well by ordinary production methods including without limitation
                condensate, distillate and other liquid hydrocarbons recovered from
                oil or
                gas run through a separator or other equipment at the lease.
                

            

    

     

    
      	 	
              1.6

            	
              “Petroleum
                Substances” means the Grantor’s share of Oil, petroleum and natural Gas
                and related hydrocarbons, all other gases and all minerals and substances
                (whether condensate, liquid or solid and whether hydrocarbons or
                not) in
                association with any of the foregoing or found in any water contained
                in
                an Oil and/or Gas reservoir but only insofar as and to the extent
                that the
                same are granted;

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

         

      

    

    

     

    
      	
              2.

            	
              Interpretations

            

    

     

    
      	 	
              2.1

            	
              References
                to a statute or statutory provision include that statute or provision
                as
                from time to time modified or re-enacted or consolidated whether
                before or
                after the date of this Agreement so far as such modification or
                re-enactment or consolidation applies or is capable of applying to
                any
                transactions entered into in accordance with this Agreement and (so
                far as
                liability thereunder may exist or can arise) shall include also any
                past
                statutory provision (as from time to time modified or re-enacted
                or
                consolidated) which such provision has directly or indirectly
                replaced.

            

    

     

    
      	 	
              2.2

            	
              The
                expressions “holding company” and “subsidiary” shall have the same
                meanings in this Agreement as their respective definitions in the
                Act.

            

    

     

    
      	 	
              2.3

            	
              References
                to this Agreement include any Recitals and Schedules to it and this
                Agreement as from time to time amended and references to Clauses
                and
                Schedules are to Clauses of and Schedules to this
                Agreement.

            

    

     

    
      	 	
              2.4

            	
              Headings
                shall be ignored in construing this
                Agreement.

            

    

     

    
      	 	
              2.5

            	
              Any
                provision of this Agreement which is expressed to bind more than
                one
                person shall, save where inconsistent with the context, bind them
                jointly
                and each of them severally.

            

    

     

    
      	 	
              2.6

            	
              References
                to time of day are to London, United Kingdom time unless otherwise
                stated.

            

    

     

    
      	 	
              2.7

            	
              References
                to the winding-up of a person include the amalgamation, reconstruction,
                reorganisation, administration, dissolution, liquidation, merger
                or
                consolidation of such person and any equivalent or analogous procedure
                under the law of any jurisdiction in which that person is incorporated,
                domiciled or resident or carries on business or has
                assets.

            

    

     

    
      	 	
              2.8

            	
              Any
                reference to books, records or other information means books, records
                or
                other information in any form including paper, electronically stored
                data,
                magnetic media, film and microfilm.

            

    

     

    
      	 	
              2.9

            	
              Any
                reference to any English legal term or concept (including for any
                action,
                remedy, method of judicial proceeding, document, legal status, statute,
                court, official governmental authority or agency) shall, in respect
                of any
                jurisdiction other than England, be interpreted to mean the nearest
                and
                most appropriate analogous term to the English term in the legal
                language
                in that jurisdiction as the context reasonably requires so as to
                produce
                as nearly as possible the same effect in relation to that jurisdiction
                as
                would be the case in relation to
                England.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    
      	 	
              2.10
                

            	
              Any
                previously undefined reference to a term commonly used in the oil
                and gas
                industry shall be as defined from time to time on www.glossary.oilfield.slb.com
                or
                any successor website.

            

    

     

    
      	
              3.

            	
              Gross
                Overriding Royalty

            

    

     

    
      	 	
              3.1

            	
              The
                Grantor hereby reserves out, grants, sets over and conveys to the
                Grantee
                an interest in the Licences, the Petroleum Substances and the Documents
                in
                the form of a gross overriding royalty of 3% (THREE
                PERCENTUM)
                percent of the Grantor’s gross interest in all Petroleum Substances
                (and/or turnover of the Grantee deriving therefrom) to be found to
                exist
                or deemed to exist within, upon or under the Licences or in the Acreage
                and which are produced, marketed and/or saved therefrom (hereinafter
                called the “Royalty”).

            

    

     

    
      	 	
              3.2

            	
              The
                Royalty shall be paid free and clear of any and all cost or expense
                of
                every kind and nature whatsoever incurred in (inter alia) connection
                with
                maintaining, renewing and extending, exploring, drilling, re-completing,
                side-tracking, producing, co-mingling of wells and reservoirs, and
                processing, treatment and compressing and operating costs of such
                Petroleum Substances subject to the provisions of Clause 8 hereof
                and save
                that the no Royalty shall be payable on any VAT validly charged by
                the
                Grantor on any sale of Petroleum Substances on behalf of the Grantee
                under
                the terms hereunder. 

            

    

     

    
      	 	
              3.3

            	
              The
                Royalty will apply until the Grantor has received the total aggregate
                figure of US$ 20,000,000 (TWENTY
                MILLION DOLLARS)
                from the gross sales of all or any Petroleum Substances production
                produced or occuring at the Wellhead in the Acreage, such value to
                be
                calculated by reference to the best prevailing
                market price
                of
                the relevant Petroleum Substances at the wellhead in Kurgan, Western
                Siberia, Russian Federation and
                in the event the sale price is in roubles then the conversion rate
                for
                dollars shall be at the rate between $ (dollars) to R (rouble) being
                the
                mid price on the relevant day as detailed in the Financial
                Times.

            

    

     

    4.    Term

     

    The
      term
      of payment for the said Royalty shall be until the same has been discharged
      in
      full in accordance with the terms hereof and shall not be affected by any
      matter, including but not limited to any change in control or ownership of
      the
      Grantee or the Grantor or any shut in or lockout at the Acreage and the term
      shall, if neccesary, last for the maximum period allowed under the rule against
      perpetuities, currently 80 years.

     

    5.     Sale
      of Petroleum Substances

     

    The
      Grantor, except during such period as the Grantee exercises its election to
      take
      the Royalty in kind shall for and on behalf of and as agent for the Grantee
      deliver to purchasers of the Petroleum Substances for sale for the credit of
      the
      Grantee the Petroleum Substances that are attributable to the Royalty. All
      sales
      and deliveries made by the Grantor for the credit of the Grantee shall be made
      on the same terms and conditions and in the same proportions as all other sales
      of Petroleum Substances by the Grantor so that the Grantee will be entitled
      to
      any market available to the Grantor with respect to the Licences or Acreage.
      The
      Grantor will arrange for the Grantee to receive payment for the proceeds of
      the
      sale of the Petroleum Substances attributable to the Royalty directly from
      the
      purchaser or purchasers of such Petroleum Substances; PROVIDED ALWAYS that
      in
      the event that any purchaser makes payment to the Grantor for any portion of
      the
      proceeds of the sale of the Petroleum Substances attributable to the Royalty,
      such proceeds shall constitute trust funds in the hands of the Grantor, and
      shall be paid in cash to the Grantee on or before the 3rd day following receipt
      or deemed receipt of the production proceeds. The Grantor shall not be required
      to make any payment to the Grantee in respect of any sales hereunder until
      it
      has received payment from the relevant purchaser (provided that it shall
      promptly notify the Grantee of such receipt of payment).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    6.    Right
      to Take in Kind 

     

    The
      Grantee shall have the right to elect from time to time upon not less than
      1
      week’s prior written notice to the Grantor to take the Royalty share of
      production in kind in respect of any one or more of the Petroleum Substances.
      Any such election may be changed from time to time by the Grantee.

     

    7.    Storage
      and Deliverability 

     

    If
      the
      Grantee exercises his right to take Royalty production in kind, the Grantor
      shall, at no cost to the Grantee, remove all basic sediment or other impurities
      and water from such Royalty production so as to render the same fit for
      acceptance by pipelines or rail or rail tankers in accordance with good industry
      practice, and shall also, at no cost to the Grantee, provide tankage sufficient
      to store thirty (30) days Royalty production of Oil and shall deliver such
      production to them from time to time at the wellhead in the case of Gas and
      at
      the outlet valve of the said storage facilities in the case of Oil.

     

    8.    Transportation
      and Plant Charges

     

    The
      Grantee’s share of any Oil in the Petroleum Substances under clause 3.1 shal be
      subject only to reasonable, lawful and agreed deduction for transportation
      as
      may be required by the Grantee. 

     

    9.    Books
      and Records

     

    The
      Grantor shall maintain in Kurgan complete and accurate records of the Petroleum
      Substances produced and saved from the Licences and of the monies received
      therefrom in accordance with local government and other authorities requirements
      and shall furnish to the Grantee with each payment made hereunder, a statement
      (verified by statutory declaration if requested by the Grantee) giving
      sufficient detail for the Grantee to ascertain the accuracy of the payment
      of
      Royalty made therewith, including copies of the monthly production reports
      filed
      with the relevant local authorities.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    10.    Development

     

    The
      Grantor is obligated to conduct any operations upon the Licences in accordance
      with good Oil and Gas field practices.

     

    11.    Forfeiture
      and Surrender

     

    The
      Grantor shall not allow the Documents to become subject to forfeiture and shall
      not surrender Licences or other interests included therein or any part
      thereof.

     

    
      	
              12.

            	
               Lien
                for Royalty

            

    

     

    
      	 	
              (a)

            	
              The
                Grantee shall be entitled to and shall have a lien upon the Grantor’s
                share of all Petroleum Substances from time to time produced from
                the
                Licences to secure the payment of the gross overriding royalty granted
                to
                the Grantee under this Agreement. Such lien shall not operate to
                release
                the Grantor from its liability for monies due to the Grantee. Such
                lien
                shall attach to the Grantor’s share of the Petroleum Substances sold or
                otherwise disposed of from the Licences. Upon default occurring in
                payment
                by the Grantor of monies payable to the Grantee, the Grantee shall
                notify
                the Grantor of same and request the default to be remedied within
                fourteen
                days. If the default is not remedied within the said fourteen days,
                such
                lien shall operate as an assignment to the Grantee in respect of
                the
                consideration thereafter payable to the Grantee for the Petroleum
                Substances sold up to the amount owed to the Grantee and not so paid
                by
                the Grantor.

            

    

     

    
      	 	
              (b)

            	
              Service
                of a copy of this Agreement upon the Grantor and any purchaser of
                Petroleum Substances together with written notice from the Grantee
                shall
                constitute written authorization on the part of the Grantor for such
                purchaser to pay to the Grantee the proceeds from any sale or sales
                of the
                Grantor’s share of the Petroleum Substances up to the amount owed to the
                Grantee by the Grantor and such purchaser is authorized to rely upon
                the
                statement of the Grantee as to the amount owed to the Grantee by
                the
                Grantor.

            

    

     

    
      	 	
              (c)

            	
              The
                books and records kept by the Grantee shall constitute written proof
                of
                the existence of such default, although no purchaser shall be obliged
                to
                examine same before acting upon such notice of
                default.

            

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    
      
        	
                13.

              	
                Further
                  Assurances

              

      

       

      Each
        party shall do and perform all such acts and things and execute and deliver
        all
        such instruments, documents in writing, and give all such further assurances
        as
        may be necessary to give full effect to the provisions and intent of this
        Agreement.

    

     

    14.    Successors
      and Assigns

     

    This
      Agreement shall enure to the benefit of and be binding upon the successors
      and
      permitted assigns of the parties hereto. The Grantee shall be able at any time
      to assign the the benefit of this Agreement and its rights and obligations
      hereunder to an associated company of Grantee.

     

    15.    Supersedes
      Prior Agreements

     

    This
      Agreement supersedes all other agreements, documents, writings and verbal
      understandings among the parties relating to the Acreage and
      Documents.

     

    16.    Public
      announcements

    
 

    
      	 	
              16.1
                

            	
              Shareholder
                approval 

            

    

     

    
      	 	 	
              None
                of the parties shall make any public announcement or issue any circular
                relating to this Agreement or any matters or information provided
                pursuant
                hereto without the prior written approval of the other Parties. This
                does
                not affect any announcement or circular required by law or any regulatory
                body or the rules of any recognised stock exchange, but the Party
                with an
                obligation to make an announcement or issue a circular shall consult
                with
                the other Party/Parties so far as is reasonably practicable before
                complying with such obligation.

            

    

     

    
      	 	
              16.2
                

            	
              Oral
                statements 

            

    

     

    
      	 	 	
              The
                Parties intend that any oral statements made or replies to questions
                given
                by either Parties relating to the Group shall be consistent with
                any such
                public announcements or circulars.

            

    

     

    17    Confidential
      Information

     

    
      	 	 	
              The
                parties shall use all reasonable endeavours to keep confidential
                and to
                ensure that their respective Associated Companies and their respective
                officers, employees, agents and professional and other advisers keep
                confidential any information (the “Confidential Information”):

            

    

     

    relating
      to the customers, business, assets or affairs of either party which they may
      have or acquire through ownership of an  interest
      in the Company; or relating to the customers, business, assets or affairs of
      the
      other parties or any member of their group which they may have or  acquire
      through being a Party hereto or through the exercise of its rights or
      performance of its obligations under this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    18.    Restrictions

     

    
      	 	
              18.1
                

            	
              No
                party may use for its own business purposes or disclose to any third
                party
                any Confidential Information without the consent of the other
                parties.

            

    

     

    
      	 	
              18.2

            	
              This
                Clause does not apply to:

            

    

     

    
      	 	
              (a)

            	
              information
                which is or becomes publicly available (otherwise than as a result
                of a
                breach of this Clause);

            

    

     

    
      	 	
              (b)

            	
              information
                which is independently developed by the relevant party or acquired
                from a
                third party, to the extent that it is acquired with the right to
                disclose
                it;

            

    

     

    
      	 	
              (c)

            	
              information
                which was lawfully in the possession of the relevant party free of
                any
                restriction on disclosure;

            

    

     

    
      	 	
              (d)

            	
              information
                which following disclosure under this Clause, becomes available to
                the
                relevant party from a source which is not bound by any obligation
                of
                confidentiality in relation to such
                information;

            

    

     

    
      	 	
              (e)

            	
              the
                disclosure by a party of Confidential Information to its principal
                shareholders or its directors or employees or to those of its Associated
                Companies who need to know that confidential information in its reasonable
                opinion for purposes relating to this Agreement but those principal
                shareholders, directors and employees shall not use that Confidential
                Information for any other purpose;

            

    

     

    
      	 	
              (f)

            	
              the
                disclosure of information to the extent required to be disclosed
                by law or
                any court of competent jurisdiction, any governmental official or
                regulatory authority (including the London Stock Exchange, the Financial
                Services Authority, the Panel on Takeovers and Mergers and the United
                States Securities and Exchange Commission) or any binding judgment,
                order
                or requirement of any other competent
                authority;

            

    

     

    
      	 	
              (g)

            	
              the
                disclosure of information to any tax authority to the extent reasonably
                required for the purposes of the tax affairs of the party concerned
                or any
                member of its group; or

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    
      	 	
              (h)

            	
              the
                disclosure to a party’s professional advisers of information reasonably
                required to be disclosed for purposes relating to this
                Agreement.

            

    

     

    
      	 	
              18.3

            	
              Each
                party shall inform any shareholder, officer, employee or agent or
                any
                professional or other adviser advising it in relation to matters
                relating
                to this Agreement, or to whom it provides Confidential Information,
                that
                such information is confidential and shall instruct
                them:

            

    

     

    (a) to
      keep
      it confidential; and

     

    (b) not
      to
      disclose it to any third party (other than those persons to  whom
      it
      has already been or may be disclosed in accordance with  the
      terms
      of this Clause).

     

    19.    Notices

     

    
      	 	
              19.1

            	
              Addresses

            

    

     

    
      	 	 	
              Any
                notice, claim or demand in connection with this Agreement shall be
                in
                writing in English (each a “Notice”) shall be sufficiently given if
                delivered or sent to the recipient at its fax number, telex number
                or
                address set out in the Schedule or any other fax number, telex number
                or
                address notified to the sender by the recipient for the purposes
                of this
                Agreement.

            

    

     

    
      	 	
              19.2

            	
              Form

            

    

     

    
      	 	 	
              Any
                Notice shall be in writing in English and may be sent by messenger,
                telegram, telex, fax or prepaid first class post (first class in
                the case
                of service in the United Kingdom and airmail in the case of international
                service). Any Notice shall be deemed to have been received on the
                next
                working day in the place to which it is sent, if sent by telegram,
                telex
                or fax, or 60 hours from the time of posting, if sent by
                post.

            

    

     

    20.    Whole
      agreement and remedies

     

    
      	 	
              20.1

            	
              Whole
                agreement

            

    

     

    
      	 	 	
              This
                Agreement contains the whole agreement between the parties relating
                to the
                subject matter of this Agreement at the date hereof to the exclusion
                of
                any terms implied by law which may be excluded by contract and supersedes
                any previous written or oral agreement between the Parties in relation
                to
                the matters dealt with in this Agreement. In this Clause “this Agreement’
                includes all documents entered into pursuant to this Agreement.
                

            

    

     

    
      	 	
              20.2

            	
              JV
                Agreement

            

    

    
       

      Nothing
        in this Agreement shall vary or alter the terms of the JV
        Agreement.

       

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    
      	 	
              20.3

            	
              Legal
                advice

            

    

     

    
      	 	 	
              Each
                party to this Agreement confirms it has received independent legal
                advice
                relating to all the matters provided for in this Agreement, including
                the
                provisions of this Clause, and agrees, having considered the terms
                of this
                Clause and the Agreement as a whole, that the provisions of this
                Clause
                are fair and reasonable.

            

    

     

    
      	 	
              20.4

            	
              No
                inducement

            

    

     

    
      	 	 	
              Each
                of the Parties acknowledges that it has not been induced to enter
                into
                this Agreement by any representation, warranty or undertaking not
                expressly incorporated into it.

            

    

     

    21.    General

     

    
      	 	
              21.1

            	
              Survival
                of rights, duties and obligations

            

    

     

    
      	 	 	
              Termination
                of this Agreement for any cause shall not release a Party from any
                liability which at the time of termination has already accrued to
                another
                Party or which thereafter may accrue in respect of any act or omission
                prior to such termination.

            

    

     

    
      	 	
              21.2

            	
              No
                partnership

            

    

     

    
      	 	 	
              Nothing
                in this Agreement shall be deemed to constitute a partnership between
                the
                Parties nor constitute any party the agent of any other party for
                any
                purpose.

            

    

     

    
      	 	
              21.3

            	
              Release

            

    

     

    
      	 	 	
              Any
                liability to any party under this Agreement may in whole or in part
                be
                released, compounded or compromised or time or indulgence given by
                that
                party in its absolute discretion as regards any party under such
                liability
                without in any way prejudicing or affecting its rights against any
                other
                party under the same or a like liability, whether joint and several
                or
                otherwise.

            

    

     

    
      	 	
              21.4

            	
              Waiver

            

    

     

    
      	 	 	
              No
                failure of any party to exercise, and no delay by it in exercising,
                any
                right, power or remedy in connection with this Agreement (each a
“Right”)
                shall operate as a waiver of that Right, nor shall any single or
                partial
                exercise of any Right preclude any other or further exercise of that
                Right
                or the exercise of any other Right. The Rights provided in this Agreement
                are cumulative and not exclusive of any other Rights (whether provided
                by
                law or otherwise). Any express waiver of any breach of this Agreement
                shall not be deemed to be a waiver of any subsequent
                breach.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    
      	 	
              21.5

            	
              Payments

            

    

     

    
      	 	 	
              All
                payments due under this Agreement shall be paid in full without any
                deduction or withholding other than as required by law or under this
                Agreement and the paying party shall not be entitled to assert any
                credit
                set off or counterclaim against any other party in order to justify
                withholding payment of any such amount in whole or in
                part.

            

    

     

    
      	 	
              21.6

            	
              Variation

            

    

     

    
      	 	 	
              No
                variation of this Agreement shall be effective unless in writing
                and
                signed by or on behalf of each of the
                parties.

            

    

     

    
      	 	
              21.7

            	
              Assignment
                

            

    

     

    
      	 	
              21.7.1.

            	
              This
                Agreement shall be binding on and inure to the benefit of the parties
                and
                their successors and permitted assigns. The parties may not assign
                or
                transfer all or any part of their rights or obligations under this
                Agreement nor any benefit arising under or out of this Agreement
                without
                the prior written consent of the other
                parties.

            

    

     

    
      	 	
              21.7.2

            	
              Except
                as otherwise expressly provided in this Agreement, the benefit of
                the
                provisions of this Agreement may not be assigned to any Associated
                Company.

            

    

     

     

    
      	 	
              21.8

            	
              Time
                of the essence

            

    

     

    
      	 	 	
              Time
                shall be of the essence of this Agreement, both as regards any dates,
                times and periods mentioned and as regards any dates, times and periods
                which may be substituted for them by agreement in writing between
                the
                parties.

            

    

     

    
      	 	
              21.9

            	
              Further
                assurance

            

    

     

    
      	 	 	
              At
                any time after the date of this Agreement the parties shall, and
                shall use
                all reasonable endeavours to procure that any necessary third party
                shall,
                at the cost of the relevant party execute such documents and do such
                acts
                and things as that party may reasonably require for the purpose of
                giving
                to that party the full benefit of all the provisions of this
                Agreement.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    
      	 	
              21.10

            	
              Illegality

            

    

     

    
      	 	 	
              If
                any provision in this Agreement shall be held to be illegal, invalid
                or
                unenforceable, in whole or in part, under the law of any jurisdiction,
                the
                legality, validity or enforceability of such provision or part under
                the
                law of any other jurisdiction and the legality, validity and
                enforceability of the remainder of this Agreement shall not be
                affected.

            

    

     

    
      	 	
              21.11

            	
              Counterparts

            

    

     

    
      	 	 	
              This
                Agreement may be entered into in any number of counterparts, all
                of which
                taken together shall constitute one and the same instrument. Any
                party may
                enter into this Agreement by executing any such
                counterpart.

            

    

     

    
      	 	
              21.12

            	
              Costs

            

    

     

    
      	 	 	
              Each
                party shall bear all costs incurred by it in connection with the
                preparation, negotiation and entry into this Agreement and the documents
                to be entered into pursuant to it. 

            

    

     

    
      	 	
              21.13

            	
              Language

            

    

     

    
      	 	 	
              This
                deed may be executed in English and in Russian. In case of any conflict
                between the English and Russian versions, the terms of the English
                version
                shall prevail

            

    

     

    22.    Contracts
      (Rights of Third Parties) Act 1999

     

    A
      person
      who is not a party to this Agreement has no right under the Contracts (Rights
      of
      Third Parties) Act 1999 to enforce any term of this Agreement.

     

    23.    Governing
      law and submission to jurisdiction

     

    
      	 	
              23.1

            	
              Governing
                law

            

    

     

    
      	 	 	
              This
                Agreement shall be governed by and construed in accordance with English
                law.

            

    

     

    
      	 	
              23.2

            	
              Jurisdiction

            

    

     

    
      	 	 	
              All
                the parties irrevocably agree that the courts of England are to have
                exclusive jurisdiction to settle any dispute which may arise out
                of or in
                connection with this Agreement.

            

    

     

    
      	 	
              23.3

            	
              Submission
                and waiver

            

    

     

    
      	 	 	
              All
                the parties irrevocably submit to the jurisdiction of such courts
                and
                waive any objection to proceedings in any such court on the ground
                of
                venue or on the ground that the proceedings have been brought in
                an
                inconvenient forum.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    
      	 	
              23.4

            	
              Appointment
                of Process Agent

            

    

     

    
      	 	 	
              The
                Grantee (the “Principal”)
                irrevocably appoints Tim Peara of 24 Hoop Lane, London NW11 8BU (the
                “Agent”)
                as its agent to accept service of process in England in any legal
                action
                or proceedings arising out of or in connection with this Agreement
                provided that:

            

    

    

      
        	
                23.4.1

                 

              	
                service
                  upon the Agent shall be deemed valid service upon the Principal
                  whether or
                  not the process is forwarded to or received by the Principal;

                 

              
	
                23.4.2

                 

              	
                the
                  Principal shall inform all other parties to this Agreement, in
                  writing, of
                  any change in the address of the Agent within 28 days of such
                  change;

                 

              
	
                23.4.3

                 

              	
                if
                  the Agent ceases to be able to act as a process agent or to have
                  an
                  address in England, the Principal irrevocably agrees to appoint
                  a new
                  process agent in England acceptable to the other parties and to
                  deliver to
                  the other parties within 14 Business Days a copy of a written acceptance
                  of appointment by the new process agent; and

                 

              
	
                23.4.4

                 

              	
                nothing
                  in this Agreement shall affect the right to serve process in any
                  other
                  manner permitted by law.

                 

              

      

    

    
    

    24.    Authority
      to deliver

     

    The
      signature or sealing of this Agreement by or on behalf of a party shall
      constitute an authority to the solicitors, or an agent or employee of the
      solicitors, acting for that party in connection with this Agreement to deliver
      it as a deed on behalf of that party.

     

    

     

     

    IN
      WITNESS WHEREOF
      the
      parties hereto have signed and delivered this Deed as of the day and year first
      above written.

    

    

      

        
          	
                  EXECUTED
                    as
                    a
                    DEED by

                   

                	
                  )

                   

                
	
                  Baltic
                    Petroleum (E&P) Limited

                   

                	
                  )

                   

                
	
                  acting
                    by a Director and

                   

                	
                  )

                   

                
	
                  a
                    Director/Secretary

                   

                	
                  )

                   

                

        

      

    
                                                                   
        ________________________________

    

                                                                 
      Director

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ________________________________

     

    Director/Secretary

    
 

    
      
        
          	
                  EXECUTED
                    as
                    a
                    DEED
                    by

                   

                	
                  )

                   

                
	
                  OOO
                    Zauralneftegaz

                   

                	
                  )

                   

                
	
                  acting
                    by General Director

                   

                	
                  )

                   

                

        

      

    

    

     

    

    

    Schedule

     

    Key:
      ° = Degrees, ' or ’ = Minutes, N.L. = North Latitude, E.L. = East
      Latitude

    

    

    (A)
      Southern-
      Voskesensky:
      situated in the Chastoozersky - Makushinsky administrative regions

    

    Geographical
      coordinates of corner points: 

    

    1.
      55°37' N.L., 67°15' E.L. 

    

    2.
      55°37' N.L., 67°17' E.L. 

    

    3.
      55°38' N.L., 67°14' E.L. 

    

    4.
      55°35' N.L., 67°45' E.L. 

    

    5.
      55°25' N.L., 67°35' E.L. 

    

    6.
      55°28' N.L., 67°15' E.L. 

    

    Area
      of the block is 520 km2 

    

    (B)
      Lebyazhevsky:
      situated in the Lebyazhyevsky - Makushinsky administrative regions.

    

    Geographical
      coordinates of corner points: 

    

    1.
      55°12' N.L., 66°47' E.L. 

    

    2.
      55°12' N.L., 66°54' E.L. 

    

    3.
      55°04' N.L., 66°41' E.L. 

    

    4.
      55°04' N.L., 66°25' E.L. 

    

    Area
      of the block is 170 km2. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    (C)
      Petuhovsky:
      situated in the Petuhovsky - Machushinksiy administration regions.

    

    Geographical
      coordinates of corner points: 

    

    1.
      55°12'N.L.,67°20'E.L., 

    

    2.
      55°12'N.L.,67°43'E.L., 

    

    3.
      54°53'N.L.,67°43'E.L.,

    

    4.
      54°
51 'N.L, 67°34'E.L., 

    

    5.
      54°52'N.L, 67°23'E.L., 

    

    Area
      of the block is 840 km2 

    

    (D)
      Privolny

    

    Geographical
      coordinates of corner points: 

    

    1.
      55°31’N.L., 67°04’E.L.

    

    2.
      55°31’N.L., 67°15’E.L.

    

    3.
      55°28’N.L., 67°15’E.L.

    

    4.
      55°27’N.L., 67°18’E.L.

    

    5.
      55°31’N.L., 67°20’E.L.

    

    6.
      55°12’N.L., 67°13’E.L.

    

    7.
      55°12’N.L., 66°58’E.L.

    

    Area
      of the block is 500km2

    

    (E)
      Mokrousovsky

    

    Geographical
      coordinates of corner points:

    

    1.55°57’N.L.,67°17’E.L.

    

    2.
      55°37’N.L.,67°17’E.L.

    

    3.
      55°37’N.L.,66°47’E.L.

    

    4.
      55°57’N.L.,66°47’E.L.

    

    Area
      of the block is 957km2

    

    (F)
      Orlovo-Pashkovsky

    

    Geographical
      coordinates of corner points:

    

    1.
      55°18’N.L., 68°10’E.L.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    2.
      55°19’N.L., 68°37’E.L.

    

    3.
      55°14’N.L., 68°37’E.L.

    

    4.
      55°14’N.L., 68°30’E.L.

    

    5.
      55°15’N.L., 68°30’E.L.

    

    6.
      55°15’N.L., 68°12’E.L.

    

    7.
      55°13’N.L., 68°12’E.L.

    

    8.
      55°13’N.L., 68°10’E.L.

    

    Area
      of the block is 200km2

    

    (G)
      West-Suersky

    

    Geographical
      coordinates of corner points:

    

    1.
      55°37’N.L., 66°43’E.L.

    

    2.
      55°20’N.L., 67°43’E.L.

    

    3.
      55°20’N.L., 66°15’E.L.

    

    4.
      55°37’N.L., 66°15’E.L.

    

    Area
      of the block is 925km2exv10w28

 

Exhibit 10.28

GRANT AGREEMENT

SMART MOVE, INC. 2006 EQUITY INCENTIVE PLAN

This Grant Agreement (“Grant Agreement”) made and entered into between Smart Move, Inc., a
Delaware corporation (the “Company”), and                                          (the “Participant”) evidences the
grant to Participant of an option to purchase shares of Company Stock (“Shares”) provided for below
(the “Option”) pursuant to the Smart Move, Inc. 2006 Equity Incentive Plan (the “Plan”). This
Grant Agreement and the Option granted hereunder is expressly subject to all of the terms,
definitions and provisions of the Plan as it may be amended and restated from time-to-time.
Capitalized terms used in this Grant Agreement and not defined herein shall have the meanings
attributed to them in the Plan.

1. Grant of Option. The Company hereby grants to Participant an Option (the “Grant”) for the
purpose and on the terms set forth below:

	 	 	 
	Purpose

	 	This Grant is made for the purposes
and in furtherance of the objectives
set forth in the Plan and is designed
to provide incentives to Participant
to exert maximum efforts for the
success of the Company and its
subsidiaries (as “Employer”) and to
align Participant’s interests with
those of the Company’s stockholders.
Participant recognizes that the
Option represents a potentially
significant benefit to Participant
and is granted for the purposes
stated herein.

	 
	 	 
	Grant Date

	 	[December 29, 2006]
	 
	 	 
	Exercise Price of Option

	 	[$4.73] per Share (being the closing
price of the Company Stock on the
Grant Date), which has been
determined to be the Fair Market
Value of a Share of the Company Stock
on the Grant Date.

	 
	 	 
	Type of Option

	 	Incentive Stock Option
	 
	 	 
	 

	 	Any Option granted to an employee of
the Company shall be an “Incentive
Stock Option” or “ISO” as described
in, and to the fullest extent
permitted under Section 422 of the
Code.

	 
	 	 
	 

	 	In the event that an Option granted
to an employee exceeds the $100,000
limitation of Section 422(d) of the
Code, the excess shall be treated as
a “Nonqualified Stock Option” (which
means any stock option that is not an
ISO). An Option granted to a
non-employee director, independent
contractor or other person not
eligible to receive an ISO grant
under Section 422 of the Code shall
be a Nonqualified Stock Option that
is not intended to qualify as an ISO
within the meaning of Section 422 of
the Code.

	 
	 	 
	Number of Shares covered by Option

	 	 
                                                            

 

Page 1

 

	 	 	 
	Vesting

	 	Subject to the provisions of the Plan
and Participant’s continued
employment with the Company, the
Option shall vest and become
exercisable as to [25% of the Shares
covered by the Option on the Grant
Date specified above and shall vest
as to the balance (75% of the Shares
covered by the Option) in equal
quarterly increments over the next
following 12 calendar quarters as of
the end of each quarter commencing
March 30, 2007.]

	 
	 	 
	Term

	 	Options expire ten (10) years from
the Grant Date, subject to earlier
termination of unexercised, vested
Options as provided herein or as set
forth in the Plan.

2. Exercise of Option.

	 	a)	 	Manner of Exercise. Except as provided in the Plan, Participant may exercise a
vested Option, in whole or in part, at any time during the term of the Option by providing
written notice to the Company stating the number of Shares in respect of which the Option
is being exercised accompanied by payment of the aggregate Exercise Price. Such written
notice may be delivered in person or by certified mail to the Corporate Secretary of the
Company or in such other form or manner as the Compensation Committee of the Board of
Directors of the Company (the “Committee”) may approve or any administrative agent engaged
by the Company may specify for such purpose. The Option may not be exercised with respect
to a number of Shares that is less than the lesser of (i) twenty-five or (ii) the total
number of Shares remaining available for exercise pursuant to this Grant Agreement.

	 
	 	b)	 	Payment. In order for an exercise of the vested Option to be effective,
Participant must pay the aggregate Exercise Price and any withholding taxes required to be
withheld with respect to the Shares being purchased. Such payment shall be made to the
Company in cash or pursuant to such other payment terms and arrangements as the Committee
may accept.

3. Transferability of Option. The Options granted hereby shall not be transferable
except in accordance with the following provisions:

	 	a)	 	Limit on Transfers. During Participant’s lifetime, all Options shall be
exercisable, only by Participant or by the legal guardian of a disabled Participant.

 

Page 2

 

	 	b)	 	Dispositions to Beneficiaries. Participant shall have the right to designate a
beneficiary who shall be entitled to exercise Participant’s Options (subject to their terms
and conditions) following Participant’s death, and to whom any amounts payable following
Participant’s death shall be paid. Such designation shall be made in such manner and in
accordance with such procedures as may be established by the Committee from time to time.
If no beneficiary designation has been made to the Committee at the time of Participant’s
death, then Participant’s beneficiary shall be deemed to be Participant’s estate or heirs
pursuant to the laws of descent and distribution. In order to exercise a Option after
Participant’s death, the beneficiary, or if no beneficiary designation has been made the
personal representative of Participant’s estate or Participant’s lawful heirs, must agree
to be bound by the provisions of the Plan and this Grant Agreement and to be treated as the
“Participant” under the Plan and the Grant Agreement. All references to the
“Participant” under the Plan and this Grant Agreement shall be deemed to refer to
Participant’s beneficiaries, the personal representative of Participant’s estate or
Participant’s heirs, as applicable after his or her death; provided, however, that
references in the Plan or this Grant Agreement to the employment of a Participant or to the
termination of such Employment or to any competitive activity by a Participant shall
continue to refer to the employment or any competitive activity of Participant.

	 	c)	 	Legal Restrictions on Transferability and Exercise. The Option covered hereby
may not be exercised in any manner or at any time if the issuance of Shares upon the
exercise of the Option or the method of payment of consideration for such Shares would
constitute a violation of any applicable federal or state securities or other law or
regulation, including any rule under Part 207 of Title 12 of the Code of Federal
Regulations (“Regulation G”) as promulgated by the Federal Reserve Board. Participant
agrees that if any of the Shares acquired by exercise of the Option granted hereunder are
registered under the Securities Act of 1933, as amended, no public offering (otherwise than
on a national securities exchange, as defined in the Securities Exchange Act of 1934, as
amended) of any Shares acquired by exercise of the Option will be made by Participant or by
any successor under circumstances such that Participant or such successor may be deemed an
underwriter, as defined in the Securities Act of 1933, as amended.

4. Withholding Taxes. If and to the extent Participant receives or is deemed to have received in
connection with the Option, any amount that is required to be included in the gross income of
Participant for federal income tax purposes and for which the Company has a tax withholding
obligation, Participant shall pay to the Company or make arrangements satisfactory to the Committee
no later than the date as of which such amount first becomes includible in Participant’s gross
income regarding the payment of, any federal, state, local or foreign taxes of any kind required by
law to be withheld by the Company with respect to such amount. If approved by the Committee in its
sole discretion, the minimum required withholding obligations may be settled with Shares, including
without limitation Shares otherwise delivered upon exercise of the Option. The obligations of the
Company under the Plan and this Grant Agreement shall be conditional on such payment, and the
Company shall, to the extent permitted by law, have the right to deduct any such taxes from any
payment otherwise due to Participant.

5. Applicability of Change of Control Provisions of the Plan. The Options and the Shares that may
be purchased by exercise of the Options are subject to all provisions of the Plan, as in effect
from time-to-time, and to all determinations of the Committee made in accordance with the terms of
the Plan, including determinations and actions taken in the event of a change of control as defined
in the Plan and as provided in Section 15 of the Plan. In accordance with said Section 15 of the
Plan, for purposes of this Grant Agreement, the term Change in Control means the occurrence or
applicability of a “change in control event” as set forth in Section 409(a) of the Code and any
Internal Revenue Service regulations or other guidance issued thereunder. By executing this Grant
Agreement, Participant expressly acknowledges: (i) receipt of the Plan; and (ii) the applicability
of all provisions of the Plan and the terms of this Grant Agreement to the Option. In the event of
any inconsistency between this Grant Agreement and the Plan, the Plan shall control.

 

Page 3

 

6. Termination of Employment or Services. Upon termination of employment or the services of
Participant, the Option may only be exercised as follows:

	 	(a)	 	Termination for reasons other than disability, death or discharge for Cause.

	 	(i)	 	Unvested Options Held on the Date of Termination. Any unvested Options
held by Participant as of the date of termination shall immediately expire.

	 
	 	(ii)	 	Vested but Unexercised Options. The deadline for Participant’s
exercise of any vested Stock Options held by Participant as of the date of termination
of employment or services (“Termination Date”) shall be three (3) months after the
Termination Date. Any vested but unexercised Stock Options not exercised on or before
the Exercise Deadline shall immediately expire.

	 	(b)	 	Termination for Cause; Post-employment conduct in contravention of this Grant
Agreement. If the Committee determines that Participant has engaged in conduct that
constitutes Cause at any time while Participant is employed by or provided service to the
Employer or thereafter, any and all Options then outstanding shall immediately terminate.
Participant shall automatically forfeit all rights with respect to any exercised portion of
an Option for which share certificates otherwise issuable have not been delivered, subject
to refund by the Company of the Exercise Price paid by Participant for such Shares.

	 
	 	(c)	 	Termination of employment or services on account of Participant’s death or Disability.
In the event of the termination of Participant’s employment or services on behalf of the
Employer as a result of Participant’s death or Disability, any unvested Options held by
Participant on the date such termination occurs that are scheduled to vest on or before the
first anniversary of the Termination Date shall immediately vest. Participant’s vested
Options may be exercised by Participant (or Participant’s beneficiaries or estate, in the
case of Participant’s death) until the second anniversary of the date of termination of
employment or services. Any unexercised Options held by Participant (or his or her
beneficiaries or estate, in the case of death) which have not been exercised prior to such
exercise deadline shall immediately expire and Participant (or Participant’s beneficiaries
or estate) shall forfeit any right, title or interest in the unexercised Options.

Notwithstanding the provisions of Section 6(a)(ii) or 6(c) above, no Option may be exercised after
the end of its originally specified term as set forth in Section 1.

7. Modification; Waiver. Except as provided in the Plan or this Grant Agreement, no provision of
this Agreement may be amended, modified, or waived unless such amendment or modification is agreed
to in writing and signed by Participant and by a duly authorized officer of the Company, and such
waiver is set forth in writing and signed by the party to be charged. No waiver by either party
hereto at any time of any breach by the other party hereto of any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. Participant acknowledges
and agrees that the Committee has the right to take certain actions in the event of a Change of
Control and that the Committee shall have the right to amend an outstanding Option in whole or in
part from time-to-time if the Committee believes, in its sole and absolute discretion that any of
the following apply: (i) a fundamental change of circumstances that frustrates any purpose or
objective of the Plan has occurred; (ii) it is necessary or appropriate to do so in light of its
interpretation of any law, regulation or rule or amendments thereto, including accounting rules,
applicable to the Plan which the Committee believes may impair the rights of the Company, its
shareholders or Participants; or (iii) the Committee believes
such amendment to be required or appropriate in order to conform the Option to, or otherwise
satisfy any legal requirement (including without limitation the provisions of Section 409A of the
Code). Such amendments may be made retroactively or prospectively and without the approval or
consent of Participant to the extent permitted by applicable law, provided that the Committee shall
not have any such authority to the extent that the grant or exercise of such authority would cause
any tax to become due under Section 409A of the Code.

 

Page 4

 

All determinations permitted or required hereunder and/or pursuant to the Plan regarding
enforcement, waiver or modification of terms and provisions applicable to the Option shall be made
by the Committee in its sole discretion. Determinations made under this Grant Agreement and the
Plan need not be uniform and may be made selectively among individuals, whether or not such
individuals are similarly situated. Participant’s signature to this Grant Agreement confirms
Participant’s acknowledgement that the terms of the Plan and this Grant Agreement are reasonable
and Participant agrees not to challenge the reasonableness of such provisions, even where
forfeiture of Options is the penalty for violation.

8. Notices. Except as the Committee may otherwise prescribe or allow in connection with
communications procedures developed in coordination with any third party administrator engaged by
the Company, all notices, including notices of exercise, requests, demands or other communications
required or permitted with respect to the Plan, shall be in writing addressed or delivered to the
parties. Such communications shall be deemed to have been duly given to any party when delivered by
hand, by messenger, by a nationally recognized overnight delivery company, by facsimile, or by
first-class mail, postage prepaid and return receipt requested, in each case to the applicable
addresses set forth below:

If to Participant:

to Participant’s most recent address on the records of the Company

If to the Company:

Smart Move, Inc.

5990 Greenwood Plaza Blvd. No. 2, Suite 390

Greenwood Village, CO 80111

Attn: Human Resources

(or to such other address as the party in question shall from time to time designate by written
notice to the other parties).

9. Governing Law. Except to the extent that provisions of the Plan are governed by applicable
provisions of the Code or other substantive provisions of federal law, the Plan and all Stock
Options made and actions taken thereunder shall be governed by and construed and enforced in
accordance with the laws of the State of Delaware without regard to the principles of conflicts of
law thereof.

10. Securities Law Restrictions. The Option covered by this Grant Agreement will be exercised and
Shares issued only upon compliance with the Securities Act of 1933, as amended (the “Act”), and any
other applicable securities law. Participant will be deemed to have represented and warranted that
upon exercising Participant’s Option, Participant will acquire the
Shares of the Company pursuant to the Plan for Participant’s own account, that Participant will not
take the Shares with a view to distribution and that Participant will dispose of the Shares only in
compliance with Rule 144 promulgated under the Act (“Rule 144”) or in any other manner as will not
violate the Act and the rules and regulations promulgated under the Act, and any other applicable
securities law.

 

Page 5

 

11. Non-Competition, Non-Solicitation and Intellectual Property Covenants.

In consideration of the Option herein granted and other consideration specified below, Participant
agrees and stipulates as follows:

	 	(a)	 	Non-competition and non-solicitation. Participant acknowledges that the Company has
trade secrets and confidential information and that as a key employee of the company, Participant
will have access to certain trade secrets and confidential information. In consideration of the
Option herein granted and of the Company’s disclosure of trade secrets and other proprietary
information, Participant agrees that during the term of Participant’s service as an employee of or
consultant to the Company or any of its subsidiaries and for a period of twenty four (24) months
after such employment or service terminates for any reason, Participant will not directly or
indirectly or in any capacity on Participant’s own behalf or on behalf of others:

	 	i)	 	Call upon any person or entity which was at any time during the preceding 12-month
period a customer or supplier of the Company or its subsidiaries for the purpose of diverting,
taking away business of, or selling products or services competitive with products or services
provided by the Company or its subsidiaries;

	 
	 	ii)	 	Alone or in any capacity on behalf of others solicit or induce any persons or persons
employed by the Company within the preceding 12-month period to leave such employment;

	 
	 	iii)	 	Within North America or any of the states or territories of the United States of
America, either as an employee, employer, consultant, agent, principal, partner, more that 5%
shareholder, member, director, officer, financier, or in any other individual or representative
capacity, engage or participate in any business or business activity that develops, designs,
engineers, manufactures, markets, advertises, sells, leases, licenses or distributes or manages
assets, products, software, asset tracking devices, systems or solutions, shipping containers, or
which conducts business operations or performs services that are in competition with any product,
sale or service activities conducted by the Company or its subsidiaries in relation to a Material
Business Activity. Material Business Activity shall be defined as a business activity or line of
business which comprised in excess of 20% of the Company’s revenue for the preceding 12-month
period.

	 	(b)	 	Intellectual property; Inventions and creative works. Participant shall disclose
promptly to the Company any and all inventions, improvements, discoveries and the like (whether or
not patentable), and all software, documentation, and other works of authorship, which Participant
conceives, devises, develops, perfects, creates or uses, whether alone or with others during the
term of Participant’s employment, and Participant hereby assigns to the Company all inventions and
all rights (including without limitation, patent rights and copyrights) in such inventions,
software, works of authorship and the like hereafter developed or conceived by Participant while
performing such services for the Company.

 

Page 6

 

	 	(c)	 	Stipulations and enforcement. Participant acknowledges and agrees that the agreements
and restrictions herein are reasonable and necessary for the protection of the Company and are an
essential inducement to the Company’s grant of the Option. Participant agrees to be bound by the
provisions of this Section 11 to the maximum extent permitted by law, it being the intent and
spirit of the parties that the foregoing shall be fully enforceable. However, the parties further
agree and stipulate that it is their intent and mutual desire that if any of the restrictions
contained in this agreement are held to be excessively broad as to duration, geographical scope,
effect upon property rights or otherwise unenforceable, the court so holding shall reduce the
geographic restriction and/or the duration of this agreement, or effect any other change to the
extent, but only to the extent absolutely necessary to render the covenants or restrictions
enforceable, while still giving effect to the parties’ expressed desire that Company be protected
to the greatest extent possible under the applicable law. Each of the terms and provisions of this
agreement is severable in whole or in part. Any term or provision found by the court to be invalid
or illegal and not subject to reformation shall be excised by the court, and the remaining terms
and provisions shall not be affected and shall remain in full force and effect. Participant
acknowledges that Participant’s services to the Company or its subsidiaries involve such special
knowledge of the Company’s business activities and trade secrets that any breach or threatened
breach cannot be remedied solely by monetary compensation or damages. Accordingly, Participant
agrees that any breach or threatened breach of any of the non-competition, non-solicitation and
intellectual property covenants of this Section 11 shall allow the Company to seek injunctive
relief restraining Participant or any other person, business or firm from committing or
participating in such breach or anticipated breach, or engaging in any activity which shall
constitute a breach of the provisions of this Section.

12. Participant’s Acknowledgement of Plan Administration Conditions. PARTICIPANT ACKNOWLEDGES AND
AGREES THAT THE VESTING OF SHARES PURSUANT TO THE OPTION HEREOF IS EARNED ONLY BY CONTINUING
CONSULTANCY OR EMPLOYMENT AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING
GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). PARTICIPANT FURTHER ACKNOWLEDGES AND AGREES
THAT NOTHING IN THIS AGREEMENT, NOR IN THE PLAN, SHALL CONFER UPON PARTICIPANT ANY RIGHT WITH
RESPECT TO CONTINUATION OF EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR SHALL IT INTERFERE IN ANY
WAY WITH PARTICIPANT’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE PARTICIPANT’S EMPLOYMENT OR
CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE. OPTIONS UNDER THE PLAN ARE GRANTED IN A
DISCRETIONARY FASHION, AND THE GRANT OF ONE OR MORE OPTIONS UNDER THE PLAN SHALL NOT GIVE RISE TO A
RIGHT IN ANY EMPLOYEE OR CONSULTANT TO RECEIVE ADDITIONAL OPTION GRANTS IN THE FUTURE. FURTHER, THE
BOARD OF DIRECTORS RETAINS THE RIGHT, IN ITS SOLE DISCRETION, TO TERMINATE THE PLAN FOR ANY REASON,
OR NO REASON, AT ANY TIME. PARTICIPANT ACKNOWLEDGES RECEIPT OF A COPY OF THE PLAN AND REPRESENTS
THAT PARTICIPANT IS FAMILIAR WITH THE TERMS AND PROVISIONS THEREOF, AND HEREBY ACCEPTS THIS OPTION
SUBJECT TO ALL OF THE TERMS AND PROVISIONS THEREOF.

 

Page 7

 

IN WITNESS WHEREOF, the Company has caused this Grant Agreement to be executed by its duly
authorized officer and Participant            has executed this Grant Agreement to confirm
Participant’s agreement to all of the terms and conditions set forth herein.

	 	 	 	 	 	 	 
	PARTICIPANT:	 	SMART MOVE, INC.
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 	 	 	 	 
	Name:

	 	 	 	Name:	 	 
	 

	 	 
	 	 	 	 
	Participant Residence Address	 	Title:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 

 

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