CANCELLATION AGREEMENT
Exhibit
10.5
CANCELLATION
AGREEMENT,
dated
as of August 31, 2007 (this “Agreement”),
by
and among, RUSSOIL
CORPORATION,
a
Nevada corporation (the “Company”),
and
XXXXXXXXX
XXXXXXXXXX
(“Xxxxxxxxxx”).
BACKGROUND
The
Company had entered into a Share Exchange Agreement with Smolenergy, the
Gorstovoye Holder and the Stockholders named therein, dated as of August 31,
2007, pursuant to which the Company is going to acquire from the Stockholders
named therein all of the issued and outstanding capital stock of OJSE
Smolenergy, a Corporation formed under the laws of the Russian Federation
(“Smolenergy”) in exchange for an aggregate amount of 110,000,000 shares of the
Company's Common Stock (the “Share
Exchange Transaction”)
to the
Gorstovoye Holder, who will cancel all indebted of Smolenergy to him arising
from Smolenergy’s acquisition of 51% of the membership interest in “Gorstovoye”
LLC.
It
is a
condition precedent to the consummation of the Share Exchange Transaction that
Xxxxxxxxxx enters into this Agreement which will effectuate the cancellation
of
242,000,000 shares (the “Subject
Shares”)
of
Common Stock of the Company held by Xxxxxxxxxx.
AGREEMENT
NOW,
THEREFORE,
in
consideration of the mutual promises herein contained and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Cancellation
of Subject Shares.
Xxxxxxxxxx has delivered to the Company for cancellation stock certificates
representing the Subject Shares along with duly executed medallion guaranteed
stock powers covering the Subject Shares and hereby irrevocably instructs the
Company and the Company's transfer agent to cancel the Subject Shares such
that
the Subject Shares will no longer be outstanding on the stock ledger of the
Company and such that Xxxxxxxxxx shall no longer have any interest in the
Subject Shares whatsoever. The Company shall immediately deliver to the
Company's transfer agent irrevocable instructions providing for the cancellation
of the Subject Shares.
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2. Representations
by Xxxxxxxxxx.
(a) Xxxxxxxxxx
owns the Subject Shares, of record and beneficially, free and clear of all
liens, claims, charges, security interests, and encumbrances of any kind
whatsoever. Xxxxxxxxxx has sole control over the Subject Shares or sole
discretionary authority over any account in which they are held.
(b) Except
for the Subject Shares, Xxxxxxxxxx has no subscription, warrant, option,
convertible security, or other right (contingent or other) to purchase or
otherwise acquire securities, including equity or debt securities, of the
Company, although he will retain 250,000 shares of the Company’s common
stock.
(c) Xxxxxxxxxx
has full right, power and authority to execute, deliver and perform this
Agreement and to carry out the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by Xxxxxxxxxx and constitutes
a
valid, binding obligation of Xxxxxxxxxx, enforceable against him in accordance
with its terms (except as such enforceability may be limited by laws affecting
creditor's rights generally).
3. Miscellaneous.
All
representations, warranties and agreements in this Agreement shall survive
the
date hereof until the expiration of the applicable statute of limitations.
This
Agreement shall be binding upon the parties' their respective successors,
representatives, heirs and estate, as applicable. This Agreement may be executed
in one or more counterparts, all of which shall be considered one and the same
agreement and shall become effective when one or more counterparts have been
signed by each of the parties and delivered to the other party, it being
understood that all parties need not sign the same counterpart. Facsimile
execution and delivery of this Agreement is legal, valid and binding execution
and delivery for all purposes. This Agreement shall be governed in all respects,
including validity, interpretation and effect, by the internal laws of the
State
of New York, without regard to the conflicts of law principles thereof. This
Agreement may not be amended except by an instrument in writing signed by each
of the parties hereto. This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof and supersedes in its entirety
any other agreement relating to or granting any rights with respect to the
subject matter hereof.
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RUSSOIL
CORPORATION
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By:
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/s/
Xxxxxxxxx Xxxxxxxxxx
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Name:
Xxxxxxxxx Xxxxxxxxxx
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Title:
President
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XXXXXXXXX
XXXXXXXXXX
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By:
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/s/
Xxxxxxxxx Xxxxxxxxxx
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Xxxxxxxxx
Xxxxxxxxxx
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