EXHIBIT 10.41
PETRODRILL ENGINEERING N.V.
- AND -
WORKSHIPS CONTRACTORS B.V.
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SUPPLY AGREEMENT
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THIS AGREEMENT is made the 5th day of November 1998,
BETWEEN:
1. PETRODRILL ENGINEERING N.V. a company incorporated in the Netherlands
Antilles under registration number 77521 and having its registered office
at Anthony Veder Building, Kaya Jacob Posner, Willemstad, Curacao,
Netherlands Antilles (hereinafter referred to as the Construction
Manager); and
2. WORKSHIPS CONTRACTORS B.V. a corporation incorporated in the Netherlands
of KP Van Der Mandeleaan 34, 3062 MD Rotterdam (Brainpark), The
Netherlands (Workships). The Construction Manager and Workships are also
hereinafter referred to collectively as PARTIES and individually as
PARTY.
WHEREAS:
A. The Construction Manager has entered into an agreement with Petrodrill
Seven Limited (such company as its assignee pursuant to a Construction
Contract Assignment, the Owner) of even date herewith (the Construction
Management Agreement) whereby the Construction Manager has been appointed
by the Owner to oversee the construction of the Owner's dynamically
positioned semisubmersible drilling unit (the Vessel).
B. The Construction Manager is desirous that Workships should provide to the
Construction Manager personnel in accordance with the terms and conditions
of this Agreement to assist the Construction Manager with various of the
technical services required by the Owner to be provided during the period
of the construction of the Vessel by the shipyard (the Builder) pursuant
to a different shipbuilding contract (the Shipbuilding Contract).
NOW, THEREFORE in consideration of the mutual covenants and obligations
hereafter set forth, it is hereby agreed between the Parties as follows:
1. DEFINITIONS
Capitalized terms used but not otherwise defined herein shall have the
meanings assigned to such terms in the Amethyst Financial Company Ltd.'s
Shareholders' Agreement of every date herewith among Drillpetro Inc.,
Westville Management Corporation and Techdrill Inc.
2. OBJECT
The object of this Agreement is the supply by Workships to the
Construction Manager of personnel such as, but not limited to, specified
in Clause 4 of this Agreement.
3. TERM
The term of this Agreement is for the period of the construction of the
Vessel by the Builder.
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4. SCOPE OF SERVICES PROVIDED BY WORKSHIPS
Workships shall provide to the Construction Manager such personnel (the
Technical Personnel) as are requested by the Construction Manager to
assist the Construction Manager in relation to the marine construction of
the Vessel and the fulfilment of the Construction Manager's obligations to
the Owner as set out in the Construction Management Agreement. The
provision of the Technical Personnel shall be on the following basis:
4.1 the Technical Personnel provided by Workships shall be suitably qualified
to advise and assist in connection with matters relating to the
construction of the Vessel as a drilling or workover unit;
4.2 at no time shall the Technical Personnel be deemed to be employees, either
temporarily or permanent, of the Construction Manager and shall at all
times be deemed to be employees of Workships;
4.3 Workships shall have the sole responsibility for the preparation of
payroll and the payment of the Technical Personnel wages, compensation,
remittance, allowance, insurance and indemnities of whatever kind and in
complying with all applicable labour and local taxation regulations.
4.4 Both Parties agree to refrain from any and all actions, direct or
indirect, that may lead to employment by such Party of an employee of the
other Party, unless such Party obtains the prior written approval of the
other Party, which approval shall not unreasonably be withheld.
4.5 Workships shall be entitled to invoice the Construction Manager for the
travel, accommodation and repatriation of the Technical Personnel during
the period of construction of the Vessel.
4.6 The Technical Personnel shall assist the Construction Manager in the
fulfilment of its obligations as set out in Clause 4 of the Construction
Management Agreement.
4.7 The Construction Manager may, if it is reasonably dissatisfied with any of
the Technical Personnel, make a request in writing to Workships that such
Technical Personnel be replaced with another suitably qualified person and
Workships shall provide the same forthwith PROVIDED ALWAYS that Workships
shall only do so if in its reasonable opinion the request of the
Construction Manager is justified.
4.8 In the event that the Construction Manager requires such Technical
Personnel to undertake tasks not included within the scope of the services
to be provided as set out in Clause 4 of the Construction Management
Agreement and agreed hereunder then the Construction Manager shall seek
the prior written consent of Workships which consent shall not be
unreasonably withheld and Workships shall instruct the Technical Personnel
concerned to comply with such request of the Construction Manager.
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4.9 Workships shall only be required to provide to the Construction Manager
such Technical Personnel as are available at the time that the
Construction Manager requires them and the choice/identity of such
Technical Personnel shall be decided upon by Workships in its absolute
discretion and PROVIDED ALWAYS that the provision of such Technical
Personnel from time to time shall not materially disrupt or adversely
affect Workships's own business in which case Workships shall be entitled
to postpone the supply of such Technical Personnel until such time as it
is more able to comply with the requirements of the Construction Manager.
5. COMPENSATION / REMUNERATION
5.1 All Technical Personnel are to be provided by Workships to the
Construction Manager on an open book, at cost basis, duly justified by
direct reference to industry standards.
For the supply of the Technical Personnel forming the object of this
Agreement, the Construction Manager will pay Workships the rates
stipulated in Appendix A herein increased on an annual basis by 3% unless
otherwise agreed.
5.2 Workships shall receive compensation from the Construction Manager in the
amount of US $2,083.33 per month as from May 1, 1998 for services
provided hereunder. This amount is due at the end of each month.
5.3 In the case of disputed invoice, the Construction Manager will inform
Workships of the item under dispute specifying the complaint within
fifteen (15) days of receipt of such invoice but will pay the undisputed
part. The disputed item will be paid as may be mutually agreed. This
amount is due at the end of each month.
5.4 Payments shall be made to a bank account nominated on each invoice.
5.5 In case of sale of the Vessels Clause 5.2 of the contract shall remain in
place for the total period of 24 months. Any outstanding amount shall be
discounted at the rate of ten percent (10%).
6. TAXES
Any taxes or charges incurred by Workships in connection with its duties
and obligations hereunder whilst supplying the Technical Services shall be
for the account of Workships.
7. LIABILITIES
7.1 COMPLIANCE WITH LAW AND REGULATION
Workships represents that the provision by it of the Technical Personnel
under this Agreement will comply with all applicable laws and regulations
in France, the Netherlands, Brazil and the jurisdictions in which the
Technical Personnel are required to operate.
7.2 LIABILITIES BETWEEN THE PARTIES
7.2.1 Workships shall hold harmless and indemnify the Construction Manager
from and against all claims, costs expenses or liabilities arising
from or connected with the performance of this Agreement in respect
of:
(i) death of or personal injury to any of the personnel of
the Workships Group;
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(ii) loss of or damage to the property of the Workships Group;
(iii) any consequential or economic loss or damage suffered by the
Workships Group;
howsoever arising and irrespective of negligence or other breach of legal
duty by the Construction Manager Group.
7.2.2 The Construction Manager shall hold harmless and indemnify Workships
from and against all claims, costs, expenses or liabilities arising
from or connected with the performance of this Agreement in respect
of:
(i) death of or personal injury to any of personnel of the
Construction Manager Group;
(ii) loss of or damage to the property of the Construction Manager
Group; and
(iii) any consequential or economic loss or damage suffered by the
Construction Manager Group;
howsoever arising and irrespective of negligence or other breach of
legal duty bY the Workships Group.
7.2.3 For the purposes of this Clause 7.2, the Construction Manager
Group means the Construction Manager, its associated companies, its
other sub-contractors and suppliers, the Owner, Petrobras, and the
officers, employees and agents of any of them.
7.2.4 For the purposes of this Clause 7.2 the Workships Group means
Workships, its associated companies, its sub-contractors and
suppliers and the officers, employees and agents of any of them.
7.2.5 For the express purposes of Clause 7 of this Agreement only, the
Construction Manager contracts on its own behalf and expressly as
agent on behalf of and as trustee for the benefit of all persons who
are or may be from time to time within the Construction Manager
Group (as defined in Clause 7.2.3) and all such persons shall to
this extent be deemed to be parties to this Agreement.
7.2.6 For the express purposes of Clause 7 of this Agreement only,
Workships contracts on its own behalf and expressly as agent on
behalf of and as trustee for the benefit of all persons who are or
may be from time to time within the Workships Group (as defined in
Clause 7.2.4) and all such persons shall to this extent be deemed to
be parties to this Agreement.
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7.3 INDEMNITY FOR OPERATIONS
Save as is provided in Article 7.2. above, the Construction Manager shall
indemnify and hold harmless and shall procure that Owner shall indemnify
and hold harmless Workships from and against all actions, proceedings,
claims, demands or liabilities whatsoever that may be brought by any other
person against, or incurred by Workships in relation to or in connection
with its performance of this Agreement unless same has arisen from the
gross negligence or wilful misconduct of Workships, in which event the
liability of Workships shall be limited to the aggregate of the management
fee received by Workships in the preceding 12 months.
8. CONFIDENTIAL INFORMATION
All information related to this Agreement regardless or whether such
information concerns the Construction Manager, its clients, its associated
companies or its contractors shall be treated as confidential and shall
not be divulged by Workships or the Technical Personnel to any third party
without the prior written consent of the Construction Manager. The
hereabove obligations shall survive the termination of the Agreement and
shall remain in force for so long as the information covered by
confidentiality has not otherwise become public knowledge.
9. INSURANCE
9.1 WORKSHIPS'S INSURANCES
Workships undertakes that it will take out all insurance policies to cover
its liabilities and those of the Technical Personnel as set forth in
Article 7 of this Agreement, such insurances shall include but not be
limited to the following:
9.1.1 Workmen's Compensation insurance and Employer's Liability insurance
for damage suffered by its personnel in amounts not less than
those required by applicable laws in The Netherlands and the
jurisdiction in which the Technical Personnel are required to
operate.
9.1.2 Comprehensive general liability insurance for its responsibility to
third parties.
9.1.3 All insurance policies as required to cover its equipment and/or
materials and those belonging to any service companies and for which
Workships is responsible.
9.2 CONSTRUCTION MANAGER INSURANCE
The Construction Manager will take out insurance policies to cover the
Construction Manager's responsibilities including but not limited to those
responsibilities set out in Clause 5.2 of the Construction Management
Agreement.
9.3 GENERAL PROVISIONS
For all insurance policies taken out:
9.3.1 Workships shall comply with the relevant insurance regulations in
force.
9.3.2 Construction Manager shall bear the costs of the premiums,
deductibles, fees and expenses relative to all policies effected
pursuant to the provisions of this Agreement.
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9.3.3 Each Party shall procure that the other Party shall be named as
co-assured to the extent permitted so as to give effect to the
provisions of Article 6 of this Agreement.
9.3.4 All of the insurance policies taken out shall state the
underwriter's waiver of subrogation to give effect to the provisions
of Article 6 of this Agreement.
10. AUDIT
Workships shall keep and cause its Technical Personnel, its contractor(s)
and subcontractor(s) to keep the books, payrolls, receipts, vouchers,
financial records, personnel records and any document related to the work
thereunder and required for administration purposes for the term of the
Agreement and for a limited period of two (2) years after termination
hereof. The Construction Manager, through its duly authorised
representatives, shall have free access with 15 days notice with no
restriction, to such information, whenever required by the Construction
Manager, and it shall also have the right, at any time subject to previous
notification to Workships, to perform the audits it deems necessary of the
aforementioned books, payrolls, receipts, vouchers, records and files in
general.
The Construction Manager reserves the right to audit the activities of
Workships and/or the Technical Personnel as deemed necessary and/or
appropriate by the Construction Manager, in order to check the contents
and compliance with the terms herein.
Notwithstanding the foregoing, in no event shall the Construction
Manager's right of audit be construed as a release or waiver of any of
Workships's obligations under this Agreement.
11. MISCELLANEOUS
11.1 FORCE MAJEURE
11.1.1 Each Party to this Agreement shall be relieved from complying with
any term of this Agreement to the extent that, and only so long as,
such compliance is prevented or delayed by force majeure, which is
defined as civil or labour disturbances, riots, strikes (other than
a strike limited to the employees of either Party), wars (declared
or undeclared), military actions, insurrections, rebellion, acts of
any governmental or military agency and actual or assumed
authority, action of elements, floods, storm or other acts of God
or any cause beyond the control of either Party, whether or not
similar to the matters herein specifically enumerated and provided
that the event shall not have been caused by the action or
negligence of that Party. That Party and/or the Parties affected
shall do its, or their, utmost to remedy the above circumstances.
11.1.2 Any Party claiming force majeure shall promptly notify the other
Party, with the evidence of the occurrence of such event.
11.1.3 If either Party hereto is prevented from or delayed in performing
all or any of its obligations thereunder as a direct result of
force majeure, such non-performance shall not be considered as a
breach of this Agreement and that Party shall be relieved from such
obligation which shall suspend payment by the other Party for the
duration of such force majeure.
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11.2 BANKRUPTCY OR ABANDONMENT OF OPERATIONS
Should Workships become insolvent or enter into any arrangement with or
for the benefit of its creditors or become unable or refuse or neglect to
perform its obligations hereunder or if Workships's equipment is seized or
taken in execution, the Construction Manager may, by notice in writing to
Workships, terminate this Agreement without thereby affecting in other
respects the obligations or liabilities of Workships.
11.3 ASSIGNMENT OF AGREEMENT
Neither Party may assign this Agreement, either wholly or in part, except
with the prior written authorisation of the other Party, which
authorisation may not be unreasonably withheld.
12. NOTICE
All notices, invoices and other communications required pursuant to this
Agreement shall be in writing and deemed to have been sufficiently given
or made if delivered by hand or send by fax to the addressee at the
address set out below;
in the case of the Construction Manager to:
PETRODRILL ENGINEERING N.V.
c/o Winkel, Sliana & Grul
Attn: Thoma Aardenburg
Pietermaai 23 Postbus 113
Curacao
Netherlands Antilles
Fax: 011 599 9 465 2890
with copies to:
WESTVILLE MANAGEMENT CORPORATION
Attn: John C.G. O'Leary
5847 San Felipe, Suite 3300
Houston, Texas 77057
Fax: 713 914 9796
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in the case of Workships to:
WORKSHIPS CONTRACTORS B.V.
KP Van Der Mandeleaan 34
3062 MD Rotterdam (Brainpark)
The Netherlands
Fax: 011 31 10 452 8176
or to such other address as the relevant Party may from time to time notify to
the other.
13. GOVERNING LAW AND ARBITRATION
13.1 This Agreement shall be governed by and construed in all respects in
accordance with the laws of England.
13.2 Any dispute or difference arising in connection with this Agreement shall
if possible be settled by mutual amicable agreement.
13.3 If any dispute should arise in connection with the interpretation and
fulfilment of this Agreement the same shall be decided by arbitration in
the city of London and shall be referred to a single arbitrator (an
Arbitrator) to be appointed by the Parties hereto. If the Parties cannot
agree upon the appointment of the single Arbitrator the dispute shall be
settled by three Arbitrators, each Party appointing one Arbitrator, the
third being appointed by the Chairman for the time being of the London
Maritime Arbitrators' Association.
13.4 If either of the appointed Arbitrators refuses or is incapable of acting,
the Party who appointed him shall appoint a new Arbitrator in his place.
13.5 If one of the Parties fails to appoint an Arbitrator, either originally or
by way of substitution, for two weeks after the other Party having
appointed his Arbitrator has sent the Party making default notice by mail
or facsimile to make the appointment, the Party appointing the third
Arbitrator shall, after application from the Party having appointed his
Arbitrator, also appoint an Arbitrator on behalf of the Party making
default.
13.6 The award rendered by the Arbitration Court shall be final and binding
upon the Parties and may if necessary be enforced by the Court or other
competent authority in the same manner as a judgment in the Court of
Justice.
13.7 Work under this Agreement shall, if reasonably possible, continue during
the arbitration proceedings.
IN WITNESS WHEREOF this Agreement has been executed in two duplicate originals
by or on behalf of the Parties hereto the day and year first above written.
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SIGNED by )/s/ Illegible
for and on behalf of )
PETRODRILL ENGINEERING N.V. )
in the presence of: )/s/ Illegible
SIGNED by )/s/ Illegible
for and on behalf of )
WORKSHIPS CONTRACTORS B.V. )
in the presence of: )/s/ Illegible
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APPENDIX 1
SCHEDULE OF RATES
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NAME COST PER WORKING DAY
US$/DAY
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Grob B.H.M. 500
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Minnes R.A. 569
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Charalampopoulos M. 111
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Jolles W. 519
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Nijs J. de 469
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Hogg T. 474
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Bugel A. 582
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Notes:
All prices above are inclusive of salaries, social security costs, insurance,
provision for holidays and travel days.
All prices are exclusive of direct flight and travel charges, accomodations.
The prices shown are valid for 12 months commencing 1st January 1998 and are
subject to annual revision of 3% (three percent) unless otherwise agreed.
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