AGREEMENT

between

OIL COMPANY

and

RESEARCH PROVIDER

regarding the Project

PROJECT NAME

CONTENTS:

Special Conditions
General Conditions

Annex A: Project description and time schedule
Annex B: Budget and payment plan
Annex C: Special provisions
Annex D: Deviations and exceptions

NOW THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:

Between RESEARCH PROVIDER, having his office at ADDRESS 1 and hereinafter called RP, and OIL COMPANY, having his offices at ADDRESS 2 and hereinafter called The Participant, the following Agreement has been concluded regarding The Participant’s participation in the joint industry Project called

PROJECT NAME

Article 1.1 This Agreement has been made between the RP and The Participant and equivalent agreements have been made between the RP and the other Participants as described in Article 3 of the General Conditions hereto.

The number of Participants is n, namely:

Participant 1

Participant 2

...

Participant n.

The RP will carry out the work specified in Annex A in this Agreement, and The Participant will pay his share of the total budget in accordance with the provisions of the General Conditions’ Article 7 and Annex B.

Article 1.2 This Agreement consists of

a) these Special Conditions,

b) the attached General Conditions,

c) the attached Annex A: Project description and time schedule,

d) the attached Annex B: Budget and payment plan,

e) the attached Annex C: Special provisions,

f) the attached Annex D: Deviations and Exceptions.

In case of any discrepancy between the documents specified in this Article 1.2, Annex D shall be given precedence over all other documents and the other documents shall be given precedence in relation to each other in the order in which they are listed in this Article 1.2.

 Article 2.1 NAME OF PROJECT MANAGER will act as Project Manager, the authority of whom is defined in Article 6 of the General Conditions.

 Article 3.1 Notices to the RP shall be sent to:

ADDRESS 1

ATT:

 Article 3.2 Notices to The Participant shall be sent to :

ADDRESS 2

ATT:

  Date: Date:

for the RP for The Participant

Sign: Sign:
Name: Name:
Position: Position:

 Affiliate
Any parent company controlling a Participant, and all present and future companies in which a Participant or its parent company owns directly or indirectly controls 50% or more of all voting shares.

Agreement
The collection of documents as defined in Article 1.2 of the Special Conditions hereto.

Budget
The total cost of the Project as defined in Annex B hereto.

 Early Termination
A date prior to the Termination date when the Steering Committee decides to stop all the activities of the Project in accordance with Article 4.3, Article 5.1 and Article 5.3 of these General Conditions.

Late Participant
Any Participant that signs an agreement in accordance with Article 3.2 of these Special Conditions after the Late Participant date as set out in Annex C hereto.

Normal Operations
As used herein, the term "Normal Operations" is meant to be construed broadly to include all activities which are presently or may reasonably become part of the business of the Party or his Affiliates including research activities and operations where the Party or his Affiliate is the operator or technical assistant to the operator.

Participant
Any company that has signed this Agreement or any other equivalent agreement in accordance with Article 3.2 of these General Conditions.

Parties
All Participants and the RP.

Party
Any Participant or the RP.

Project
The work that is to be carried out by the RP and which is described in Annex A hereto.

Project Manager
An employee of the RP which is named in Article 2.1 of the Special Conditions hereto and whose responsibilities are defined in Article 6 of these General Conditions.

Steering Committee
A committee composed by representatives from the Participants and whose responsibilities are defined in Article 4 of these General Conditions.

Termination
The date when the work as described in Annex A hereto has been completed and accepted by the Steering Committee and all invoices have been paid by the Participants in accordance with Article 7 of these General Conditions and Annex B hereto.

Article 3.1 The purpose of the Agreement is to regulate the financial relations between the Parties regarding the Project, and to define the rights and obligations of the Parties with respect to the performance and results of the Project.

Article 3.2 It is the intention to enter into equal terms and conditions between the RP and each Participant. Possible deviations and exceptions shall be included in Annex D of the Agreement between the RP and the Participant. A copy of this shall be sent to all other Participants and special conditions granted to one Participant shall automatically be offered to all other Participants.

Article 4.2 Each Party wishing to be represented shall appoint a representative and a deputy representative to the Steering Committee. Each of them shall be given full authority to represent the appointing Party in all matters within the jurisdiction of the Steering Committee.

Article 4.3 The Steering Committee shall have the power to:

a) approve or disapprove work plans and budgets proposed by the RP.

b) decide on changes in the Project. Major changes in scope of work, any increase in the overall Budget, and acceptance of Late Participant require unanimous approval.

c) decide on changes in the overall budget.

d) decide on changes in the objective of the Project as defined in Annex A hereto.

e) decide on Early Termination of the Project.

f) review the progress of the Project.

g) approve or disapprove the results of the Project.

h) approve the admittance of external entities as observers in the Steering Committee.

Article 4.4 The Steering Committee shall meet on an agreed frequency. A meeting shall be held whenever requested by any of the Parties.

Article 4.5 The venue of the Steering Committee meeting shall be at the RP’s premises, unless otherwise decided by the Steering Committee. 

Article 4.6 The Chairman of the Steering Committee shall be elected by and among the Participant’s representatives to the Steering Committee.

Article 4.7 Decisions in the Steering Committee are made by simple majority, except in the cases described in Article 4.3b in these General Conditions. In case of equal votes the Chairman’s vote becomes decisive. 

Article 4.8 Costs incurred by the representative of any Participant in connection with the Steering Committee meetings, such as travel expenses, hotel bills, etc., shall be borne by the respective Participant.

If the Participants agree to cause an Early Termination of the Project, the Participants shall pay all documented costs to wind up the Project. No other termination fee shall apply.

 Article 5.2 The RP shall carry out the execution of the Project in a diligent and professional manner and is committed to carry out the entire scope of work as set out in Annex A hereto to a cost to the Participants in accordance with the Budget as set out in Annex B hereto. The RP will, however, not accept any liability in the event that the objectives of the Project as set out in Annex A hereto are not met.

Article 5.3 Equipment bought by or at the expence of the Participants for the execution of the Project is the property of the Participants unless the Steering Committee decides otherwise. At the Termination or Early Termination of the Project the Steering Committee may decide to resell the equipment or to give it to the RP. 

Article 5.4 Two copies of a technical summary report which summarises progress of work and potential findings of the Project shall be submitted by the RP to each Participant quarterly or at an interval decided by the Steering Committee.

At the same time, the financial status of the Project shall be presented to the Participants as information only.

Article 5.5 Two copies of preliminary technical reports shall be submitted to each Participant at the completion of each specific part of the Project. These reports shall present the work done on this part in sufficient detail to form a basis for the final report. 

Article 5.6 Two copies of final reports for each specific part of the Project shall be submitted to each Participant before Termination, within time limits set out by the Steering Committee. A final report for the whole Project shall mark the end of the work by the RP. This final report shall as a minimum contain a management summary, an evaluation of the fulfilment of the objectives of the Project as set out in Annex A hereto, an evaluation of the potential use of the final results of the Project, an evaluation of the technology contents of the results of the Project and an evaluation of new competence that has been developed in the Project. 

Article 5.7 RP is encouraged to establish "Web Sites" for Project information via Internet with necessary security to prevent non-participants reading the information.

Article 6.2 The Project Manager shall be present at all meetings of the Steering Committee and he shall be responsible for:

a) minutes of each Steering Committee meeting.

b) presenting the RP’s proposals for work plans and budgets to the Steering Committee.

c) executing the Project in compliance with work plans and budgets as approved by the Steering Committee.

d) co-ordinating the various activities of the Project.

e) reporting in accordance with Article 5.4-5.6 of these General Conditions.

Article 7.1 The Participant agree to contribute financially to the Project by paying his share as specified in Annex C hereto of the Budget as specified in Annex B hereto.

Article 7.2 If the Project is started up before the Budget as set out in Annex B hereto is fully financed, this is the risk of the RP unless the Participants agree to guarantee for the lacking financial resources.

 Article 7.3 In the event that more resources are made available than those needed to finance the Budget as set out in Annex B hereto, each Participant’s share as set out in Annex C hereto shall be reduced until the financing equals the Budget, unless otherwise decided by the Steering Committee.

 Article 7.4 If an Early Termination is decided by the Steering Committee, each Participant can only be invoiced for his proportional share of the actual expenditure of the Project until the date of the Early Termination plus his proportional share of the termination fee as set out in Article 5.1 of these General Conditions.

Article 7.5 Upon signature of this Agreement the RP is entitled to invoice the Participant for a part of his share as specified in Annex C hereto and in accordance with the payment plan as set out in Annex B hereto. The remaining contribution shall be paid according to this payment plan.

Article 7.6 Invoices shall be paid within 30 days following the Participants receipt of the invoice. Interest on late payment will be charged according to "Morarenteloven".

Article 8.2 All results of and information on the Project obtained in the course of its execution shall be treated as confidential by the Parties. Subcontractors shall sign a confidentiality agreement to the same effect. The period of confidentiality is set forth in Annex C hereto. After the end of the confidentiality period, the Parties are free to treat the results of the Project without any confidentiality restrictions.

The confidentiality obligation imposed upon each Party by this Agreement does not apply to information which:

a) is or becomes part of the public domain through no fault of the Party.

b) is proved to have been in the possession of the Party or in the possession of one of his Affiliates prior to the receipt of the information under this Agreement.

c) is proved to have been received by the Party or one of its Affiliates from a third party without a confidentiality obligation.

d) is developed by the Party or one of his Affiliates as a result of activities carried out independently of the Project, and without access to technical information made available under the Agreement.

 Article 8.3 During the confidentiality period specified in Annex C hereto each Party has the right to divulge data from the Project to clients, consultants, contractors, members of production groups for which he is operator or technical assistant, relevant regulatory authorities and certifying agencies to the extent that their participation in a specific project would so necessitate. A Party making use of this right shall require the recipient to sign a confidentiality agreement limiting the use and divulgence of Project data to such a specific and named project only.

Article 8.4 Subject to the Steering Committee’s approval, parts of the Project’s results of general scientific interest may be published in professional fora provided that proper acknowledgement is made to the Project and its Participants. No Participant’s name shall be used without written permission from the concerned Participant.

Article 8.5 Should the RP come in a position where he is able to commercialise the results of the Project, the Participants shall be granted special preferential rights and discounts on services and equipment that are developed from the results of the Project or they shall receive royalties from the RP. The details of the foregoing shall be agreed upon by the Steering Committee. The details of these rights and discounts are set out in Annex C hereto.

Article 9.1 The RP shall not be liable for injury to or death of any employee of any Participant or damage to or loss of any Participant’s or his employee’s property caused by the RP’s or any subcontractor’s execution of the Project and the Participant shall indemnify and hold harmless the RP or any subcontractor from any and all such claims unless such liability is caused solely by the negligence or wilful misconduct of the indemnitee. 

Article 9.2 The Participant shall not be liable for injury to or death of any employee of the RP or any subcontractor or damage to or loss of the RP’s or any subcontractor’s or their respective employee’s property during the execution of the Project and the RP shall indemnify and hold harmless the Participant from any and all such claims unless such liability is caused solely by the negligence or wilful misconduct of the indemnitee.

Article 9.3 The RP shall defend and indemnify the Participant, its employees and representatives and hold them harmless from any and all liabilities to any third party arising out of or relating to the execution of the Project by the RP unless such liability is caused solely by the negligence or wilful misconduct of the indemnitee.

The RP agrees to carry a general liability insurance up to AMOUNT for each accident or any claim or series of claims that the RP may be liable to pay according to the conditions outlined in Article 9.3 of these General Conditions. The RP shall, when required, produce to the Participants the necessary documentation to evidence this insurance.

Nothing herein shall be construed as limiting the right of any Party to conduct independent research in any area including research within the scope of the Project.

Article 12.2 By signing an agreement as set out in Article 3.2 of these General Conditions, the Late Participant attains the same rights and obligations as the other Participants. Effective from the date of signing such an agreement, the Late Participant will have the right to be represented and vote in the Steering Committee.

Delay in or failure of performance of any Party hereto shall not constitute a default hereunder or give rise to any claim for damage if and to the extent such delay or failure is caused by an occurrence beyond the control of the Party affected and which, by the exercise of reasonable diligence, said Party is unable to prevent.

This Agreement shall be governed by Norwegian law. Any dispute arising in connection with this Agreement which cannot be settled by private negotiations between the parties hereto, shall be finally settled by arbitration in Stavanger according to chapter 32 of the Norwegian Civil Procedure Act of August 13, 1915 as subsequently amended.

Article 15.5 The Participant may withhold any amount charged as a consequence of RP’s not fulfilling his obligations under Article 15.1-15.4 above.

The Participant or his authorised representative has the right to audit the RP’s Project accounts during the terms of this Agreement and for a period of two years after the end of the calendar year in which the Project is completed or otherwise terminated. Such audit shall be executed at the RP’s premises. All costs in connection with the audit shall be borne by the Participant.

RP shall have an implemented and documented system for quality assurance. Such system shall conform to relevant Norwegian legislation and, unless approved otherwise by the Steering Committee, to the relevant requirements of Norwegian Standard NS-ISO-9001, -9002 or -9003 of 1994, as appropriate to the Project and in accordance with NS-ISO-9000-1 of 1994, clause 8, or approved equivalent standards. 

The Participant may, at any time and from time to time, perform quality audits and verification of RP’s quality assurance system. RP shall co-operate fully and offer reasonable assistance in this regard.

RP shall take all safety precautions necessary to protect RP’s employees and any employee of the Participants and other persons who are at any time directly or indirectly affected by the Project. RP shall at all times comply fully with relevant laws and regulations related to the care for and protection of the environment.

Article 19.1 This Agreement will become effective when it has been signed by the Participant and the RP and notification has been given by the RP that the Project has started, see Article 7.2 of these General Conditions. 

Article 19.2 Changes to this Agreement may be recommended by the Steering Committee, but require the consent of the RP and the Participant. The changes will be valid only in the form of an amendment to this Agreement. Changes in Annex A are exempt from this regulation, see Article 4.3b of these General Conditions.

MINIMUM REQUIREMENTS TO THE CONTENTS OF THIS ANNEX:

A1. BACKGROUND
This paragraph gives the background for the Project and puts it into a certain context.

A2. OBJECTIVE
This paragraph defines the qualitative and quantitative objectives that the carrying out of the scope of work is aimed at reaching. It will also be the basis for measuring the success of the Project.

A3. SCOPE OF WORK
This paragraph defines in detail the work that the RP has committed to carry out. It must be divided in tasks in such a way that control of the progress of the Project is easily measurable. Each task will be the smallest unit to which a Budget figure is connected and to which a risk factor must be attributed. The final scope of work is a binding part of the Agreement and can only be altered by the Steering Committee.

A4. POTENTIAL USE OF RESULTS
Here an evaluation of the potential upside for the Participants must be defined and quantified. A potential commercialisation by the RP must be identified here in order to form the basis for special rights and discounts set out in Annex C hereto.

 A5. TIME SCHEDULE
The time schedule is a binding part of the Agreement and can only be altered by the Steering Committee.

B1. BUDGET
For each task as set out in Annex A hereto, costs must be identified for manpower, consumable goods and equipment. The hourly man hour rate used by the RP for each category of personnel must be shown as well as the total number of hours which is deemed necessary to perform the scope of work. The final Budget is a binding part of the Agreement and can only be altered by the Steering Committee.

 B2. PAYMENT SCHEDULE
Each Participant may agree to follow his own payment schedule as long as the total payments add up the Participant’s share as set out in Annex C hereto.

C.1 PARTICIPANT’S SHARE
Here, the maximum amount the Participant will have to pay is stated.

C.2 PROJECT DURATION
Here, the commencement date and Termination date is set out.

C.3 LATE PARTICIPANT DATE