EXHIBIT 10.1
ROYALTY AGREEMENT
-----------------
ROYALTY AGREEMENT, made this May, 2000, by and between Marine Shuttle Operations
AS, a Corporation having its principal office and place of business at
Xxxxxxxxxxxx 00, X.X.XXX 0000, X-0000 Xxxxxxx (hereinafter referred to as MSO);
and Marine Shuttle Operations Inc, a Company organized and existing under the
Laws of Nevada, USA, having its principle place of business at 0000 Xxxxxxxxx
Xxxxxxxxx, Xxxxxxx. Xxxxx 00000, XXX (hereinafter referred to as MSO Inc);
and
Xxxxxx Xxxx, Xxxxxxxxxx 00, 0000X0, xxx Xxxx, Xxx Xxxxxxxxxxx (hereinafter
referred to as Xxxx).
1. Background
----------
Xxxx has entered into Addendum No. 1 to Agreement Regarding Intellectual
Property, which Addendum relates specifically to the waiver by Xxxx in
favour of MSO AS of Intellectual Property Rights to the Offshore Shuttle
Concept.
The purpose of this Agreement is to stipulate the Royalty Payments (the
Royalty Payments) to which Xxxx shall be entitled in respect of the said
Addendum No. 1.
Both parties to this Agreement recognize that the application of the
Offshore Shuttle Concept has to date not generated any revenues.
Both parties also recognise that certain work will have to be performed by
Xxxx also in the future in order to maintain the Intellectual Property
Rights to the Offshore Shuttle Concept. The corresponding undertakings by
Xxxx are outlined in Article 3 of this Royalty Agreement.
2
2. Royalty Payments
----------------
Subject to Article 6 hereof, the parties agree that Xxxx shall receive
annual royalty payments (the Royalty Payments) in the amount of USD
120,000,- (USD -One hundred and twenty thousand-) to be paid in twelve
monthly installments for a period of 10 consecutive years from the date of
fulfillment of the conditions contained in Article 3 of the aforementioned
Addendum No. 1.
Royalty Payments shall be made without demand, and the first payment shall
be made on the first day of the first calendar month following the
completion of the fulfillment of the conditions referred to in the
foregoing paragraph of this Article.
In the event that Xxxx should decease at any time during the 10
year-period referred to in the first paragraph of this Article 2, then his
Estate shall be entitled to receive the Royalty Payments for the remainder
of that 10 year-period. The Estate of Xx. Xxxx shall in respect of Royalty
Payments be deemed to be limited to such heirs as the spouse and children,
inclusive of grandchildren, of Xxxx.
All Royalty Payments under this Agreement shall be made in gross amounts,
without deductions of any kind. Any and all taxes, duties or suchlike
which may be attracted to the Royalty Payments under this Agreement shall
be the sole responsibility of Xxxx or his Estate.
3. Confidentiality: Maintenance of Intellectual Property Rights
------------------------------------------------------------
Xxxx shall assist MSO AS in the maintenance of the Intellectual Property
Rights waived to the benefit of MSO AS in the Agreement Regarding
Intellectual Property and its Addendum No. 1.
The following shall apply with regard to the maintenance services provided
by Xxxx:
a) The work shall consist in the maintenance and further development of
the Offshore Shuttle Concept being covered by the Intellectual
Property Rights as provided in Article 6 of the Agreement Regarding
Intellectual Property Rights.
b) During the period following the date of signature of this Royalty
Agreement and until such time as Offshore Shuttle No. 1 has been
built, tested and commissioned, and for a reasonable period
thereafter, such period not to exceed 3 years as from the date of
the signature of the Royalty Agreement, Xxxx will be available to
MSO to do maintenance work for a maximum of 30 hours per week,
except during periods of illness and holiday.
c) After the expiry of the time frame referred to in litre b) and
during the remaining time of the 10 year period referred to in the
first paragraph of Article 2, Xxxx shall make himself available for
MSO AS not more than 10 hours per month, unless otherwise agreed.
3
d) Xxxx shall report directly to the Board of Directors of MSO AS and
MSO Inc., or to individuals nominated by the said directors in his
work relative to the maintenance of Intellectual Property Rights as
set forth in this Article 3.
e) Xxxx shall have the right to terminate the maintenance work for MSO
AS by 30 days' written notice. He shall not receive any Royalty
Payments as from the effective date of the termination. In such
case, also this Royalty Agreement shall become terminated from the
same date, with no effect on the Addendum No. 1 to the Agreement
regarding Intellectual Property Rights.
4. Confidentiality: Protection of Trade Secrets
--------------------------------------------
All memoranda, notes, records or other documents made or compiled by Xxxx
or made available to him prior to or subsequent to the execution of this
Agreement, relating wholly or in part to the Offshore Shuttle-Concept,
shall be deemed to be Trade Secrets.
Xxxx undertakes to treat all Trade Secrets with the utmost confidentiality
against all third parties and will not divulge or make known any such
Trade Secret without the prior written consent of the MSO.
Xxxx further undertakes to keep such Trade Secrets in safe keeping in
accordance with guidelines which may from time to time may be issued by
MSO, provided, however, that such guidelines do not cause Xxxx to incur
costs and/or burdens substantially different from those reasonably
envisaged by him at the time of execution of this Royalty Agreement.
5. Non-Competition
---------------
From the date for execution of this Agreement and for the duration of the
10 year-period referred to in the first paragraph of Article 2 hereof,
Xxxx will not compete with, or directly or indirectly, own, manage,
operate, control, loan money to, or participate in the ownership,
management, operation or control of, or be connected with as a director,
officer, employee, partner, consultant, agent, independent contractor or
otherwise, or acquiesce in the use of his name in any other business
organization which competes with MSO or its subsidiaries or sister
companies in any geographical area in which the Offshore Shuttle Concept
or any development thereof may be applied.
It is further agreed that Xxxx shall make available to MSO any and all
such Trade Secrets as referred to in Article 3 hereof, inclusive of such
unrecorded knowledge that may be available to Xxxx, which MSO from time to
time may require.
4
6. General
-------
In the event that Xxxx significantly should fail to observe any of his
obligations and/or undertakings as specified in Articles 3, 4, 5 and 6
hereof, then Xxxx shall have forfeited his right to receive Royalty
Payments from MSO, and MSO shall be entitled to discontinue any and all
payments of Royalty Payments from the date of such failure by Xxxx. The
same will apply in the event that Xxxx is in material breach of any other
of his explicit or implied contractual undertakings towards MSO or
companies directly or indirectly contracted by MSO.
7. Governing Law
-------------
This Agreement shall be interpreted and construed in accordance with the
Laws of the Kingdom of Norway.
______________, this _____ day of ____________, 2000
Marine Shuttle Operations AS Marine Shuttle Operations Inc.
-------------------------------- ------------------------------
Xxxxxx Xxxx
TAA/wh
