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EXHIBIT 10(I)
SHELL DEVELOPMENT COMPANY
A DIVISION OF SHELL OIL COMPANY
ONE SHELL PLAZA
P. O. BOX 2463
HOUSTON, TEXAS 77252-2463
L. L. SMITH
VICE PRESIDENT
SAFETY, ENVIRONMENT & TECHNOLOGY
SHELL OIL COMPANY
Our Ref: STVP LGVP
Shell Internationale Research Maatschappij, B. V.
P. O. Box 162
30 Carel van Bylandtlaan
The Hague 2076, The Netherlands
SUBJECT: AGREEMENT FOR RESEARCH SERVICES
Gentlemen:
This refers to the Agreement dated January 1, 1960, between our companies
entitled "Agreement for Research Services," as amended.
Programs and budget for the year 1994 having been exchanged in accordance with
paragraph 9 of said Agreement, and the parties having agreed to the factors
referred to in subparagraph 10 (c) (iii), we now wish to confirm our
understanding with you that said Agreement, as amended, shall be continued for
the calendar year 1994, with the amount of the monthly payment to be determined
and paid according to the terms of said Agreement.
Please indicate your concurrence to the continuation of the said Agreement on
the basis indicated above by executing both of the executed letters enclosed and
returning one of them to us and retaining the other for your files.
Yours very truly,
SHELL OIL COMPANY
By /s/ L. L. Smith
----------------------------
L. L. Smith
Accepted and Agreed to:
The Hague, 7 December, 1993
Shell Internationale Research Maatschappij, B. V.
By /s/ J. R. Street /s/ G. H. Gandy
--------------------------- ----------------------------
J. R. Street G. H. Gandy
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EXHIBIT 10(II)
(COMPOSITE COPY
REFLECTING AMENDMENTS
THROUGH AUGUST 19, 1982.)
AGREEMENT FOR RESEARCH SERVICES
AGREEMENT, dated January 1, 1960, as amended, between SHELL INTERNATIONALE
RESEARCH MAATSCHAPPIJ N.V., a Netherlands corporation (hereinafter called
"S.I.R."), and SHELL OIL COMPANY, a Delaware corporation (hereinafter called
"Shell").
WITNESSETH:
Shell, either directly or through one or more of its affiliates, is engaged
in research in the fields of petroleum technology, petro chemicals and other
fields in laboratories in the United States. S.I.R., either directly or through
one or more of its affiliates, likewise is engaged in research in the same
general fields in laboratories located outside the United States.
Shell and S.I.R. have each expressed an interest in procuring the
performance of research services by the other, in exchange for the performance
of research services by it. In furtherance of that interest, Shell has submitted
to S.I.R. a research program which it is prepared to perform or cause to be
performed in 1960, if this Agreement is entered into by the parties, and a
proposed budget therefor. The activities covered by that research program are
hereinafter sometimes called the "Shell research services." Likewise, S.I.R. has
submitted to Shell a research program which it is prepared to perform or cause
to be performed in 1960, if this Agreement is entered into by the parties, and a
proposed budget therefor. The activities covered by that research program are
hereinafter sometimes called the "S.I.R. research services." Each of the parties
has examined the program and budget submitted to it by the other party and has
expressed its desire to enter into this Agreement.
Accordingly, in consideration of the premises and the mutual covenants and
agreements hereinafter set forth, the parties hereto do hereby agree as follows:
1. In consideration of S.I.R.'s agreements set forth in paragraph 2
hereof, Shell shall perform the Shell research services during the year
1960, and shall keep S.I.R. promptly and fully informed of the progress
thereof.
2. In consideration of Shell's agreements set forth in paragraph 1
hereof, S.I.R. shall perform the S.I.R. research services during the year
1960, shall keep Shell promptly and fully informed of the progress thereof,
and shall pay Shell in each month during said year the sum of $1,083,333.
3. Neither party shall have the right to control or direct the
activities of the other party in the conduct of research hereunder in any
manner whatsoever; and each party, in performing services for the other
hereunder, shall do so as an independent contractor. Each party shall be
free to engage in research outside the scope of the program submitted by it
to the other party. Such research shall not be deemed research which is
subject to this Agreement, and none of the provisions of this Agreement
shall apply thereto, unless the parties (upon such terms and conditions as
they may then determine) shall otherwise mutually agree. Each party shall
use its best efforts and judgment in the conduct of each research project
undertaken by it which is subject to this Agreement, and if such action is
warranted in its judgment, may modify or cease any such research project,
or depart from the budget therefor submitted to the other party, anything
in this Agreement to the contrary notwithstanding. In the event of any such
cessation, or of any such modification or departure which is material in
character, the party responsible therefor shall promptly give notice to the
other party thereof and of such adjustment, if any, as is proposed in the
terms of this Agreement because of such cessation, modification or
departure. Unless the party receiving such notice, within 30 days after
receipt thereof, shall notify the other party to the contrary, the party
receiving such notice shall be deemed to have consented to such cessation,
modification or departure and to such proposed adjustment, if any, and this
Agreement shall be deemed to have been amended accordingly. If
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the party receiving such notice shall, within 30 days after receipt
thereof, notify the other party that it does not consent to such cessation,
modification or departure or to such proposed adjustment, if any, then,
this Agreement shall be terminated as of the close of the calendar month
ending not less than 20 days after the date of receipt by the other party
of such notification, unless the parties shall otherwise agree. In the
event of such termination, the rights and obligations of the parties
hereunder shall be settled as if this Agreement covered only the period
from the date thereof to the date of such termination, instead of the year
1960.
4. Any obligation undertaken by either party hereunder may be
delegated by it to an affiliate or affiliates and any right to which either
party is entitled hereunder may be extended by it to any affiliate of
affiliates.
5. As used in this Agreement:
"Affiliates" of Shell are all companies in whatever countries
organized in which Shell shall at the time in question, directly or through
one or more intermediaries, either (i) own, or have the power to exercise
control of, 50% or more of the stock having the right to vote in an
election of directors, or (ii) have the power to exercise management
control by agreement.
"Affiliates" of S.I.R. are N.V. Koninklijke Nederlandsche Petroleum
Maatschappij, a company of the Netherlands (herein called "Royal Dutch"),
The "Shell" Transport and Trading Company, an English company (herein
called "Shell T. & T.") and all companies (other than Shell or an affiliate
of Shell) in whatever countries organized in which S.I.R., Royal Dutch, or
Shell T. & T., either alone or in any combination, shall at the time in
question, directly or through one or more intermediaries, either (i) own,
or have the power to exercise control of, 50% or more of the stock having
the right to vote in an election of directors, or (ii) have the power to
exercise management control by agreement.
6. Anything in this Agreement to the contrary notwithstanding, neither
a party nor its affiliates shall furnish any information hereunder of
whatsoever nature where the furnishing of the information is not in
accordance with all requirements of the law such as, for example, legal
requirements concerning:
(a) the export of information from any country, or
(b) those who may or may not receive information in the interest of
national security.
7. To the extent that any patent rights (including any inventions,
rights to apply for patents, patent applications, patents, and transferable
or licensable rights thereunder) may result directly or indirectly from
research performed after December 31, 1962 which is subject to this
Agreement, such rights shall be owned by Shell in respect of the United
States and by S.I.R. in respect of the rest of the world; provided that
each party shall have a royalty-free, non-exclusive, non-transferable,
irrevocable right (which it may extend to affiliates on any terms it sees
fit) to manufacture, use and under all such patent rights of the other
party and to authorize licensees under its own such patent rights to export
products made thereunder to any point in the world.
8. Each of the parties shall execute and deliver, or cause to be
executed and delivered, all instruments and documents necessary or
desirable to effectuate the purposes and intent of this Agreement.
9. (a) This Agreement shall become effective as January 1, 1960, and
continue until December 31, 1960. On or prior to September 1, 1960, and
October 31st of each year thereafter, each party desiring the Agreement to
continue for the ensuing calendar year shall submit to the other party the
research program which it is prepared to perform or cause to be performed
in the ensuing year, if the Agreement is continued for such ensuing year,
and a proposed budget therefor. If each party submits such a program and
budget to the other party and if each party, after examining the program
and budget submitted to it by the other party, still desires the Agreement
to continue for the ensuing year, it shall so notify the other party. If
each party so notifies the other, prior to the end of the then current
year, the Agreement shall continue mutatis mutandis with respect to the
programs and budgets so submitted and agreed, and the
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activities covered thereby, for such ensuing year. Otherwise the Agreement
shall be suspended at the end of the then current year.
(b) If an item of research submitted by one party as a part of its
research program under paragraph 9(a) of the Agreement is expected to
require more than one year to complete, the party submitting such item
shall so inform the other party to the Agreement, and at the request of the
other party, shall furnish, in addition to the year's program and budget
for that item, an estimation of the item's total duration and cost. An item
of research so identified both by the submitting party and the other party
shall become an item of continuing research. If the parties agree to
include an item of continuing research as part of the research services
under the Agreement, the party proposing such items of continuing research
recognizes the obligation either to offer such item of continuing research
as part of its research services under the Agreement until completion of
such item, or to give the other party at least one year's notice, ending
October 31, to the contrary. This obligation shall in no way affect the
rights of each party under paragraph 3 of the Agreement, nor shall it be
binding in the case of suspension or termination of the Agreement.
10. (a) If the Agreement is continued for an ensuing year the annual
costs of the research services referred to in paragraphs 1 and 2 hereof
shall be shared by the parties hereto in the ratio of the prospective
benefits to be realized by each party from the aggregate of the research
services rendered hereunder by S.I.R. and SHELL respectively in such
ensuing year, each party's share of the combined cost of S.I.R. and SHELL
Research Services in such ensuing year being equal to the aggregate of its
respective share of the direct and indirect costs of each item in each
category of the combined research services.
(b) For the purpose of determining each party's prospective benefits
as referred to in sub-paragraph (a) of this Paragraph 10, the term "party"
where used in sub-paragraph (c)(i) and in the sharing formula in
sub-paragraph (c)(ii) of this Paragraph 10 shall include such party's
affiliates as defined in Paragraph 5 hereof.
(c)(i) The prospective benefits referred to in sub-paragraph (a) of
this Paragraph 10 shall be determined annually in respect of each item in
each category of S.I.R.'s and SHELL's research services in such ensuing
year taking into account all pertinent facts and circumstances including
(but without limitation) the revenues in the twelve-month period ending
June 30 of the then current year (or investment level in the twelve-month
period ending June 30 of the then current year and the consecutive
preceding four twelve-month periods ending June 30) of each party in those
segments of its business which benefit from the research services rendered
by S.I.R. and SHELL respectively, and the anticipated use of the results of
such services in the light of the anticipated business of either party.
(c)(iii) Taking into account all such facts and circumstances,
S.I.R.'s and SHELL's share of the cost of each item in each category of the
research services rendered by each party in such ensuing year (X) shall be
equal to an amount which bears the same relationship to the total costs of
such item (Y) as the revenues of the party concerned for the twelve-month
period ending June 30 of the then current year from the related segment of
its business (S) (or investment level therein, as defined in sub-paragraph
(c)(i) in this Paragraph 10, where appropriate), multiplied by a discount
factor representing the delay, if any, jointly anticipated by S.I.R. and
SHELL in the time of utilization in such segment of the result of the
research services rendered by each (D) bears to the sum of the products of
such revenue/discount calculation for both parties.
X S(a) x D(a)
--- = ------------------------------------------------- = D(a)
Y (S(a) x D(a)) + (S(b) x D(b))
where, if the symbol (a) is applied to S.I.R., the symbol (b) applies to
SHELL or vice-versa subject, however, to the limitation that in no event
shall the fraction of the cost of an item to be paid by S.I.R. or SHELL
respectively exceed that party's discount factor for the item in question.
If the limitation applies to one party, the balance of the cost of that
item shall be paid by the other party.
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The parties will, prior to October 1 of each year, agree on the
respective currency exchange values to be applied in determining revenues,
investment levels and expenditures for the research services rendered by
each party in the ensuing year. The agreed currency exchange values will be
based on published information from generally accepted authoritative
sources.
(c)(iii) In addition to submitting programs and budgets pursuant to
Paragraph 9, the parties shall submit to each other within a reasonable
period of time prior to the end of the then current year the revenue or
investment level of each relevant segment of its business and the following
data for each item of research, which consists of one research project or a
group of research projects having a common or interrelated scientific,
technological or business aspect, pertaining to such programs and budgets:
a designation of the related segment of the parties' business for each item
of research, whether revenue or investment level is appropriate for the
item, and, if a new item of research, the delay, if any, anticipated in the
time of utilization by the parties of the results, or if not a new item of
research, any change in such delay, if any, together with an explanation of
the changed pertinent facts and circumstances. Further, with respect to
items of research which are not new, the parties shall periodically from
time to time re-examine, as business conditions change, the appropriateness
of the anticipated delay in the time of utilization of the results by the
respective parties. Notification by the parties of their desire to continue
the Agreement shall be construed as a joint acceptance of such data (in the
form in which it appears at the time of notification) as relate to the
programs and budgets upon which such notification is based.
In view of the fact that there may not be sufficient time between the
receipt of the programs and budgets and the end of the current year to
permit full and complete consideration to be given to the anticipated delay
in the time of utilization of the results of an item of research performed
by the other party, a party may propose a change in a discount factor for
an item of research before the 15th of May of the ensuing calendar year or
before a material portion of that time of research has been performed
during that calendar year, whichever occurs first. In the event that the
parties are unable to agree with respect to a proposed change, the item of
research shall be deemed to be research outside the scope of and not
subject to this Agreement.
(d) If the cost of the research services rendered by one party
hereunder exceeds the share which pursuant to Paragraph 10 hereof has to be
borne by such party, then the difference shall be paid by the other party
in accordance with sub-paragraph (e).
(e) A provisional determination of the share of the costs to be borne
by each party (utilizing revenue and investment levels furnished pursuant
to sub-paragraph (c)(iii) of this Paragraph 10 and proposed budgets) shall
be made prior to the end of the then current year for the ensuing year. A
monthly payment shall be made by the party who will have paid less than its
share of the total costs (as provisionally determined pursuant to this
Paragraph 10) to the other party, in an amount equal to 1/12th of the
balancing payment as so determined. On or before the 15th of May of the
ensuing calendar year, such provisional determination of the shares of the
total cost to be borne by each party and of the amount of any balancing
payment to be made shall be revised to reflect any change in any discount
factor pursuant to Paragraph 10(c)(iii). As soon as the actual costs of the
items of research previously estimated pursuant to this Paragraph 10(e) are
known, a final determination shall be made of the share of the cost to be
borne by each party and the amount of the balancing payment, if any. Any
additional payment or refund required to conform the provisional
determination to the final determination of the balancing payment required
shall be made promptly.
11. (a) Subject to the provisions of sub-paragraph (b) of this
Paragraph 11, the Agreement is amended with effect from 31st October 1968
and it shall remain in force until terminated on 31st December in any year
by one party giving the other party not less than one year's prior notice
to that effect, or as permitted in Paragraph 3, provided always that if
during the term of this Agreement the parties fail to agree on their
respective research services for the then ensuing year the Agreement shall
be suspended for such ensuing year and research engaged in by each party
during the period of suspension shall not be research subject to this
Agreement.
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(b) Despite the termination of the Agreement or any suspension thereof
the provisions of Paragraph 7 hereof shall continue to apply to the
research performed by either party as a part of its research services
performed under the Agreement prior to termination or suspension of the
Agreement.
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