Document:

Exhibit
      10.23

    

    

    FARMOUT
      ACKNOWLEDGEMENT AGREEMENT

    

    WHEREAS
      Deep
      Well Oil and Gas, Inc. (herein “Deep Well”), Northern Alberta Oil Ltd. (herein
“Northern”) (herein Deep Well and Northern collectively referred to as the
“Farmors”), Surge Global Energy, Inc. (“Surge U.S.”) and Surge Global Energy
      (Canada), Ltd. (the “Farmee”) have entered into a farmout agreement dated
      February 25, 2005, as amended effective November 1, 2005 (the “Farmout
      Agreement”) with respect to those leases and lands described in Schedule “A” to
      the Farmout Agreement (known as the Sawn Lake oil sands property);

    

    AND
      WHEREAS
      the
      Farmee is currently negotiating a brokered private placement of secured
      convertible debentures (the “Debentures”) in the principal amount of up to
      $10,000,000 CAD (the “Private Placement”);

    

    AND
      WHEREAS
      MGI
      Securities Ltd. (the “Agent”) will act as the Farmee’s exclusive agent in
      offering the Debentures to subscribers;

    

    AND
      WHEREAS
      the
      Agent, as a condition of the Private Placement, requires the Farmors to confirm
      and validate the enforceability of the Farmout Agreement;

    

    NOW
      THEREFORE
      in
      consideration for $10.00 paid by the Farmee to each of Surge U.S. and the
      Farmors and the promises, covenants and agreements contained herein, the
      validity and sufficiency of such consideration being hereby confirmed, the
      parties hereby agree as follows:

    

    Deep
      Well, Northern, Surge U.S., the Farmee and Deep Well Oil & Gas (Alberta)
      Ltd. (“Deep Well Alberta”) confirm and agree that all of the terms, provisions,
      rights and obligations set out in the Farmout Agreement remain in full force
      and
      effect and the Farmee and Surge U.S. are in good standing and not in default
      under the agreement. In particular, Deep Well, Deep Well Alberta and Northern
      confirm, acknowledge and agree that Surge U.S. and the Farmee, as applicable,
      have complied with Section 3.1 (as amended by valid extension notices), Section
      13.1(a) and Section 14.1 of the Farmout Agreement and are not in default under
      any of those sections or any other provision of the Farmout Agreement. The
      parties to the Farmout Agreement agree that the “Test Well” (as defined in the
      Farmout Agreement) has been Spud in accordance with the Farmout Agreement,
      the
      Test Well was drilled to the Contract Depth and the Farmee has fully performed
      all its obligations and undertaking under the Farmout Agreement in respect
      of
      the Test Well and Article 3 whereby the Farmee did earn the working interest
      in
      the section of land on which the Test Well is situated as provided for in
      Section 3.2 of the Farmout Agreement, together with the Farmor’s Pre-Farmout
      Working Interest in 5 additional sections of the Farmout Lands provided they
      are
      selected by Farmee by January 31, 2006. Furthermore, Deep Well, Northern, Deep
      Well Alberta, Surge U.S. and the Farmee represent and warrant to the Agent
      that
      all of the conditions precedent set out in Section 2.1 of the Farmout Agreement
      have been completed. Deep Well, Northern, Deep Well Alberta, Surge U.S. and
      the
      Farmee acknowledge that the Agent is relying on the foregoing representations
      in
      completing the Private Placement. The Farmors acknowledge and confirm that
      the
      Farmee is entitled to rely on the foregoing and this Farmout Acknowledgement
      Agreement is in order to drill Option Wells under Articles 4 and 5 of the
      Farmout Agreement.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    This
      Agreement may be executed in any number of separate counterparts with the same
      effect as if all Parties had signed the same copy of this Agreement. All
      counterparts shall be construed together and constitute one
      agreement.

    

    The
      terms
      of this Acknowledgement Agreement are agreed to this 15th
      day of
      November, 2005.

    

    
      	
              DEEP
                WELL OIL AND GAS, INC,

            	 	
              SURGE
                GLOBAL ENERGY, INC.

            
	 	 	 	 	 	 	 
	
              Per:

            	
              /s/
                Horst A. Schmid

            	 	
              Per:

            	
              /s/
                David Perez

            
	 	
              Name:
                Horst A. Schmid

            	 	 	
              Name:
                David Perez

            
	 	
              Title:
                President and CEO

            	 	 	
              Title:
                

            
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
              NORTHERN
                ALBERTA OIL LTD.

            	 	
              SURGE
                GLOBAL ENERGY (CANADA), LTD.

            
	 	 	 	 	 	 	 
	
              Per:

            	
              /s/
                Curtis J. Sparrow

            	 	
              Per:

            	
              /s/
                Fred W. Kelly

            
	 	
              Name:
                Curtis J. Sparrow

            	 	 	
              Name:
                Fred W. Kelly

            
	 	
              Title:
                President

            	 	 	
              Title:
                

            
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
              DEEP
                WELL OIL AND GAS (ALBERTA) LTD.

            	 	
              MGI
                SECURITIES LTD.

            
	 	 	 	 	 	 	 
	
              Per:

            	
              /s/
                Horst A. Schmid

            	 	
              Per:

            	
              /s/
                Tony P. Loria

            
	 	
              Name:
                Horst A. Schmid

            	 	 	
              Name:Tony
                P. Loria

            
	 	
              Title:
                President and CEO

            	 	 	
              Title:Exhibit
      10.25

    DEEP
      WELL OIL & GAS, INC.

     

    NON-QUALIFIED
      STOCK OPTION AGREEMENT

     

    This
      NON-QUALIFIED
      STOCK OPTION AGREEMENT
      (the
“Agreement”)
      is
      made this 28 day of November, 2005, by and between Deep
      Well Oil & Gas, Inc.,
      a
      Nevada corporation (the “Corporation”)
      and
      _____________________, an individual resident of Edmonton, Alberta
      (“Optionee”).

     

    

      
        	
                1.

              	
                Grant
                  of Option

              
	 	 	 
	 	
                The
                  Corporation hereby grants Optionee the option (the “Option”) to purchase
                  all or any part of an aggregate of 375,000 shares (the “Shares”) of Common
                  Stock of the Corporation at the exercise price of $0.71 per share
                  according to the terms and conditions set forth in this Agreement
                  and in
                  the Deep Well Oil & Gas, Inc. November 28, 2005 Stock Option Plan (the
                  “Plan”). The Option will not be treated as an incentive stock option
                  within the meaning of Section 422 of the Internal Revenue Code of
                  1986, as amended (the “Code”). The Option is issued under the Plan and is
                  subject to its terms and conditions. A copy of the Plan will be
                  furnished
                  upon request of Optionee.

              
	 	 	 
	 	
                The
                  Option shall terminate at the close of business five years from
                  the date
                  hereof (the “Option Termination Date”).

              
	 	 	 
	
                2.

              	
                Vesting
                  of Option Rights; Transferability

              
	 	 	 
	
                (A)

              	
                This
                  Option shall be exercisable, in whole or in part, according to
                  the
                  following vesting schedule:

              
	 	 
	 	
                (i)

              	
                175,000
                  Shares immediately,

              
	 	
                (ii)

              	
                100,000
                  Shares on February 6, 2006,

              
	 	
                (iii)

              	
                100,000
                  Shares on February 6, 2007,

              
	 	 	 
	
                subject
                  to Optionee’s continuing to provide services to the Corporation or any
                  Subsidiary as an employee, director or consultant, as the case
                  may be,
                  during the immediate annual period preceding such
                  dates.

              
	 	 	 
	
                (B)

              	
                During
                  the lifetime of Optionee, the Option shall be exercisable only
                  by Optionee
                  and shall not be assignable or transferable by Optionee, other
                  than by
                  will or the laws of descent and distribution. Notwithstanding the
                  foregoing, until such time as the Corporation inter-lists on an
                  exchange
                  in Canada, and with the prior written consent of the Corporation,
                  Optionee
                  may transfer the Option to any to a member of the immediate family
                  of such
                  Optionee or to a trust, partnership, limited partnership, limited
                  liability company or other entity formed exclusively for the benefit
                  of
                  such Optionee or members of the immediate family of such Optionee
                  (“Family
                  Member”), provided, however, that

              
	 	 	 
	 	
                (i)

              	
                Optionee
                  may not receive any consideration for such transfer,

              
	 	
                (ii)

              	
                the
                  Family Member must agree in writing not to make any subsequent
                  transfers
                  of the Option other than by will or the laws of the descent and
                  distribution and

              
	 	
                (iii)

              	
                the
                  Corporation receives prior written notice of such
                  transfer.

              

      

       

       

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

       

      
        	
                3.

              	
                Exercise
                  of Option after Death or Termination of Services or
                  Employment

              
	 	 	 
	 	
                Except
                  as otherwise determined by the Board:

              
	 	 	 
	
                (A)

              	
                In
                  the event that an Optionee ceases to provide services to the Corporation
                  as a result of termination for cause (as such term is defined at
                  common
                  law), each of the Options held by the Optionee shall cease to be
                  exercisable after the date of termination of employment or services
                  as a
                  director or consultant.

              
	 	 	 
	
                (B)

              	
                In
                  the event that an Optionee ceases to provide services to the Corporation
                  for any reason other than termination for cause or death, any vested
                  Option held by Optionee may continue to be exercised by the Optionee
                  to
                  and until the earlier of:

              
	 	 	 
	 	
                (i)

              	
                the
                  applicable expiration of the Option Period in respect of such Option;
                  and

              
	 	 	 
	 	
                (ii)

              	
                the
                  period after the date on which Optionee ceases to provide services
                  to the
                  Corporation that is permitted by the applicable laws, policies,
                  rules and
                  regulations of any stock exchange upon which the Underlying Shares
                  are
                  then listed, posted and/or quoted for trading; 

              
	 	 	 
	
                (C)

              	
                In
                  the event of death, the heirs, administrators or legal representatives
                  of
                  a Optionee, or any person or persons to whom the Option is transferred
                  by
                  will or the applicable laws of descent, may exercise the Optionee's
                  Options within twelve months after the date of the Optionee's death
                  to the
                  extent such Options were by their terms exercisable prior to his
                  death or
                  within the period of twelve months following his death; but for
                  greater
                  certainty no Option shall be exercisable after its stated termination
                  date. In the event that the heirs, administrators or legal representative
                  of an Optionee who has died, or any person or persons to whom the
                  Option
                  is transferred by will or the applicable laws of descent, exercises
                  the
                  Optionee's Option in accordance with the terms of the Plan, the
                  Corporation shall have no obligation to issue the Common Shares
                  until
                  evidence satisfactory to the Corporation has been provided by such
                  persons
                  that persons are entitled to acquire the Common Shares under the
                  Plan.

              
	 	 	 
	
                (D)

              	
                Notwithstanding
                  the above, in no case may the Option be exercised to any extent
                  by anyone
                  after the Option Termination Date.

              

      

       

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

       

      
        	
                4.

              	
                Method
                  of Exercise of Option

              
	 	 	 
	 	
                Subject
                  to the foregoing, the Option may be exercised in whole or in part
                  from
                  time to time by serving written notice of exercise on the Corporation
                  at
                  its principal office within the Option period. The notice shall
                  state the
                  number of Shares as to which the Option is being exercised and
                  shall be
                  accompanied by payment of the exercise price. Payment of the exercise
                  price shall be made;

              
	 	 
	
                (A)

              	
                in
                  cash (including bank check, personal check or money order payable
                  to the
                  Corporation),

              
	 	 
	
                (B)

              	
                with
                  the approval of the Corporation (which may be given in its sole
                  discretion), by delivering to the Corporation for cancellation
                  shares of
                  the Corporation’s Common Stock already owned by Optionee having a Fair
                  Market Value (as defined in the Plan) equal to the full exercise
                  price of
                  the Shares being acquired,

              
	 	 
	
                (C)

              	
                with
                  the approval of the Corporation (which may be given in its sole
                  discretion), by electing to have the Corporation retain from the
                  number of
                  Shares to be issued to the Optionee upon the exercise of such Option
                  Shares having a Fair Market Value on the date of exercise equal
                  to the
                  aggregate exercise price payable upon exercise of such
                  Option;

              
	 	 
	
                (D)

              	
                through
                  a special sale and remittance procedure pursuant to which Optionee
                  (or any
                  other person or persons permitted to exercise the option) shall
                  concurrently provide irrevocable instructions

              
	 	 
	 	
                (i)

              	
                to
                  a Corporation designated brokerage firm to effect the immediate
                  sale of
                  the purchased shares and remit to the Corporation, out of the sale
                  proceeds available on the settlement date, sufficient funds to
                  cover the
                  aggregate exercise price payable for the purchased shares plus
                  all
                  applicable income and employment taxes required to be withheld
                  by the
                  Corporation by reason of such exercise and

              
	 	
                (ii)

              	
                to
                  the Corporation to deliver the certificates for the purchased shares
                  directly to such brokerage firm in order to complete the sale;
                  or

              
	 	 	 
	
                (E)

              	
                by
                  any combination of the methods of payment described
                  above.

              
	 	 
	
                5.

              	
                Securities
                  Law Matters. 

              
	 	 
	
                (A)

              	
                Restricted
                  Securities. The Optionee understands and acknowledges that neither the
                  Option nor the Shares have been registered under the United States
                  Securities Act of 1933, as amended (the “Securities Act”), that the Option
                  has been issued to it in reliance on an exemption from the registration
                  requirements of the Securities Act, and that the Option and the
                  Shares
                  are, or will be, as applicable, “restricted securities” as defined in Rule
                  144 under the Securities Act.

              
	 	 
	
                (B)

              	
                Accredited
                  Investor. The Optionee represents that it is an “accredited investor”
                  within the meaning of Rule 501(a) under the Securities
                  Act.

              
	
                (C)

              	
                Restrictions
                  on Exercise. The Optionee understands and acknowledges that the Option
                  may be exercised only pursuant to an exemption from the registration
                  requirements of the Securities Act and applicable state securities
                  laws,
                  and that at the time of any proposed exercise, the Corporation
                  may require
                  an opinion of counsel or other evidence satisfactory to it to the
                  effect
                  that the Shares may be issued pursuant to such exercise without
                  registration under the Securities Act or applicable state securities
                  laws.

              

      

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

       

      
        	(D) 	
                Resale
                  Restrictions. The Optionee understands and acknowledges that
                  notwithstanding anything to the contrary contained in this Agreement,
                  the
                  Option and the Shares may be offered, sold, pledged or otherwise
                  transferred only

              
	 	 
	 	
                (i)

              	
                to
                  the Corporation;

              
	 	
                (ii)

              	
                outside
                  the United States in accordance with Rule 904 of Regulation S under
                  the
                  Securities Act and in compliance with applicable Canadian local
                  laws and
                  regulations; or

              
	 	
                (iii)

              	
                within
                  the United States, in a transaction that does not require registration
                  under the Securities Act or any applicable state securities laws.
                  In
                  connection with any proposed sale, pledge or other transfer of
                  the Option
                  or the Shares, the Corporation may require an opinion of counsel
                  or other
                  evidence satisfactory to it to the effect that the proposed sale,
                  pledge
                  or other transfer may be effected without registration under the
                  Securities Act or applicable state securities laws.

              
	 	 	 
	
                (E)

              	
                Legend.
                  The Optionee understands and acknowledges that upon the original
                  issuance
                  of the Shares, as applicable, and until such time as the same is
                  no longer
                  required under applicable requirements of the Securities Act or
                  state
                  securities laws, the certificates representing the Shares, and
                  all
                  certificates issued in exchange therefor or in substitution thereof,
                  shall
                  bear a legend with respect to the transfer restrictions set forth
                  above.

              
	 	 
	
                6.

              	
                Miscellaneous

              
	 	 	 
	
                (A)

              	
                Plan
                  Provisions Control.
                  In the event that any provision of the Agreement conflicts with
                  or is
                  inconsistent in any respect with the terms of the Plan, the terms
                  of the
                  Plan shall control.

              
	 	 
	
                (B)

              	
                No
                  Rights of Stockholders.
                  Neither Optionee, Optionee’s legal representative nor a permissible
                  assignee of this Option shall have any of the rights and privileges
                  of a
                  stockholder of the Corporation with respect to the Shares, unless
                  and
                  until such Shares have been issued in the name of Optionee, Optionee’s
                  legal representative or permissible assignee, as
                  applicable.

              
	 	 
	
                (C)

              	
                No
                  Right to Employment.
                  The grant of the Option shall not be construed as giving Optionee
                  the
                  right to be retained in the employ of, or as giving a director
                  of the
                  Corporation or a Subsidiary (as defined in the Plan) the right
                  to continue
                  as a director of the Corporation or a Subsidiary, nor will it affect
                  in
                  any way the right of the Corporation or a Subsidiary to terminate
                  such
                  employment or position at any time, with or without cause. In addition,
                  the Corporation or Subsidiary may at any time dismiss Optionee
                  from
                  employment, or terminate the term of a director of the Corporation
                  or a
                  Subsidiary, free from any liability or any claim under the Plan
                  or the
                  Agreement. Nothing in the Agreement shall confer on any person
                  any legal
                  or equitable right against the Corporation or any Subsidiary, directly
                  or
                  indirectly, or give rise to any cause of action at law or in equity
                  against the Corporation or a Subsidiary. The Option granted hereunder
                  shall not form any part of the wages or salary of Optionee for
                  purposes of
                  severance pay or termination indemnities, irrespective of the reason
                  for
                  termination of employment. Under no circumstances shall any person
                  ceasing
                  to be an employee of the Corporation or any Subsidiary be entitled
                  to any
                  compensation for any loss of any right or benefit under the Agreement
                  or
                  Plan which such optionee might otherwise have enjoyed but for termination
                  of employment, whether such compensation is claimed by way of damages
                  for
                  wrongful or unfair dismissal, breach of contract or otherwise.
                  By
                  participating in the Plan, Optionee shall be deemed to have accepted
                  all
                  the conditions of the Plan and the Agreement and the terms and
                  conditions
                  of any rules and regulations adopted by the Committee and shall
                  be fully
                  bound thereby.

              
	 	 
	
                (D)

              	
                Governing
                  Law.
                  The validity, construction and effect of the Plan and the Agreement,
                  and
                  any rules and regulations relating to the Plan and the Agreement,
                  shall be
                  determined in accordance with the internal laws, and not the law
                  of
                  conflicts, of the State of Nevada.

              
	 	 
	
                (E)

              	
                Severability.
                  If any provision of the Agreement is or becomes or is deemed to
                  be
                  invalid, illegal or unenforceable in any jurisdiction or would
                  disqualify
                  the Agreement under any law deemed applicable by the Committee
                  (as defined
                  in the Plan), such provision shall be construed or deemed amended
                  to
                  conform to applicable laws, or if it cannot be so construed or
                  deemed
                  amended without, in the determination of the Committee, materially
                  altering the purpose or intent of the Plan or the Agreement, such
                  provision shall be stricken as to such jurisdiction or the Agreement,
                  and
                  the remainder of the Agreement shall remain in full force and
                  effect.

              

      

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

       

      
        	
                (F)

              	
                No
                  Trust or Fund Created.
                  Neither the Plan nor the Agreement shall create or be construed
                  to create
                  a trust or separate fund of any kind or a fiduciary relationship
                  between
                  the Corporation or any Subsidiary and Optionee or any other
                  person.

              
	 	 
	
                (G)

              	
                Headings.
                  Headings are given to the Sections and subsections of the Agreement
                  solely
                  as a convenience to facilitate reference. Such headings shall not
                  be
                  deemed in any way material or relevant to the construction or
                  interpretation of the Agreement or any provision
                  thereof.

              
	 	 
	
                (H)

              	
                Conditions
                  Precedent to Issuance of Shares;
                  Repurchase Rights. Shares shall not be issued pursuant to the exercise
                  of the Option unless such exercise and the issuance and delivery
                  of the
                  applicable Shares pursuant thereto shall comply with all relevant
                  provisions of law, including, without limitation, the Securities
                  Act of
                  1933, as amended, the Exchange Act of 1934, as amended, the rules
                  and
                  regulations promulgated thereunder, the requirements of any applicable
                  Stock Exchange or the Nasdaq National Market and the corporate
                  laws of the
                  state of Nevada. As a condition to the exercise of the purchase
                  price
                  relating to the Option, the Corporation may require that the person
                  exercising or paying the purchase price represent and warrant that
                  the
                  Shares are being purchased only for investment and without any
                  present
                  intention to sell or distribute such Shares if, in the opinion
                  of counsel
                  for the Corporation, such a representation and warranty is required
                  by
                  law.

              
	 	 
	
                (I)

              	
                Withholding.
                  In order to comply with all applicable federal, state or provincial
                  income
                  tax laws or regulations, the Corporation may take such action as
                  it deems
                  appropriate to assure that all applicable federal, state or provincial
                  payroll, withholding, income or other taxes are withheld or collected
                  from
                  Optionee.

              
	 	 
	
                (J)

              	
                Adjustment
                  to Number of Shares and Exercise Price. Subject to approval if
                  necessary of any relevant stock exchange, the Board will adjust
                  the number
                  of Shares subject to an Option, and the exercise price per Share
                  payable
                  upon exercise of an Option, upon the occurrence of any stock dividend,
                  stock split, reverse stock split, combination of shares, reclassification
                  of shares, recapitalization or other similar corporate transaction
                  with
                  respect to the Shares. Notwithstanding the preceding sentence to
                  the
                  contrary, no such adjustment will be made upon the conversion of
                  any debt
                  instrument, share of preferred stock or other convertible security
                  of the
                  Corporation into Shares.

              
	 	 
	
                (K)

              	
                Review
                  of Plan. Optionee acknowledges receipt of a copy of the Plan and
                  represents that he or she is familiar with the terms and provisions
                  thereof, and hereby accepts this Option subject to all of the terms
                  and
                  provisions thereof. Optionee has reviewed the Plan and this Option
                  in
                  their entirety, has had an opportunity to obtain the advice of
                  counsel
                  prior to executing this Option and fully understands all provisions
                  of the
                  Option. Optionee hereby agrees to accept as binding, conclusive
                  and final
                  all decisions or interpretations of the Board upon any questions
                  arising
                  under the Plan or this Option.

              
	 	 
	
                (L)

              	
                Change
                  of Address. Optionee further agrees to notify the Corporation upon any
                  change in the residence address indicated below.

              
	 	 
	 	
                IN
                  WITNESS WHEREOF, the Corporation and Optionee have executed this
                  Agreement
                  as of the date set forth in the first
                  paragraph.

              

      

    

     

    

     

    
      	 	 	 
	 	DEEP
              WELL
              OIL & GAS, INC.
	 
 	 
 	 
 
	 	By:  	 
	 	Name:	 
	 	Title:  	 
	 	 

    

    

      	 	 	 
	 	OPTIONEE
	 
 	 
 	 
 
	 	Name:	 
	 	Address: 	 
	 	 

    

     

     

    
      
         

      

      
        5

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