Merchant Royal

Press Release: http://shipwreck.net/pr151.html

Citing health reasons, John C. Morris has relinquished his position as CEO and Chairman of the Board of Odyssey Marine.

"As many of our friends and investors know, I have been dealing with serious health issues for some time now. I have therefore made the decision that it is in Odyssey's best interest that Greg takes over my offices. I am very proud of what we have built over the years, and with Greg at the helm I feel fully confident about the Company's future. I am excited to still be able to serve Odyssey by providing ongoing consulting services, and by continuing to maintain a substantial amount of my personal assets in the Company".

The Board of Directors of Odyssey Marine Exploration (NasdaqCM:OMEX), the world leader in the field of deep-ocean shipwreck exploration, has appointed Odyssey Co-founder Greg Stemm to the positions of Chief Executive Officer and Chairman of the Board effective January 3, 2008. The Board also appointed two new directors, Mark D. Gordon and Bradford B. Baker, and selected Dr. David Bederman to serve as Lead Director effective January 1, 2008.

Stemm will replace Co-founder John C. Morris as CEO and Chairman who on January 3, 2008 transitioned to a consulting role with Odyssey Marine Exploration.

Copy of Protective Order: http://docs.justia.com/cases/federal/district-courts/florida/flmdce/8:2006cv01685/186117/82/

At today's pretrial conference between Odyssey Marine and the Kingdom of Spain both parties reached an agreement for a Protective Order protecting all three arrested sites. This order is the basis of a "Confidentiality Agreement" that is being reported in the press.

Within 14 days of the issuance of the protective order, Odyssey will provide to the Kingdom of Spain "the location of the vessels, any information material to the identification of the vessels, a listing and description of the artifacts, and any photographs or videotapes of the site or vessel."

This agreement is a major step forward towards the resolution of the dispute between Spain and Odyssey. The agreement is "best for everybody," Odyssey co-founder Greg Stemm said after the hearing. "Now we can talk about the facts." He acknowledged it has been hard for Spanish officials to determine how much of an interest they have in the treasure without knowing what it is or where it came from.

James Goold, a Washington attorney who is representing Spain, acknowledged that the government may decide it has no claim to the shipwrecks after viewing the information. Mr. Goold's statement is the first hint that Spain may withdraw from some, if not all, of the cases and could dramatically speed up the resolution of the Black Swan.

The next preliminary pretrial conference will be on March 5, 2008, at 9:30 a.m. The actual trial is scheduled for Oct. 2008.

On Oct. 21, 2007, I posted a Complaint that was filed by a Mr. Keith Bray against Odyssey Marine for a breach of contract issue concerning research that Mr. Bray supplied Odyssey with for the Land's End site (one of three sites arrested by Odyssey and contested by Spain).

Original Complaint: http://docs.justia.com/cases/federal/district-courts/florida/flmdce/8:2006cv01685/186117/58/1.html

On Jan 9th, 2008 Odyssey Marine answered the complaint and practically denied every point.

Odyssey's Answer to Complaint: http://docs.justia.com/cases/federal/district-courts/florida/flmdce/8:2006cv01685/186117/79/

In an attachment to Odyssey's Answer, an exhibit entitled "Research Agreement" clearly shows that Mr. Bray's research was specifically regarding the MERCHANT ROYAL. Up until now there has only been speculation that the Merchant Royal was the vessel that Odyssey found at the Land's End site. For the first time it is now documented that the Merchant Royal was a ship Odyssey was looking for (and might have found).

Research Agreement: http://docs.justia.com/cases/federal/district-courts/florida/flmdce/8:2006cv01685/186117/79/1.html

Odyssey signed the Research Agreement with Mr. Bray to be effective on April 1, 2006. In the Sept., 2006 Verified Complaint filed by Odyssey against the Land's End site, Odyssey stated that they found the unidentified shipwreck in the "summer of 2006". I find this very interesting.

Sept. 2006 Verified Complaint in Admiralty In Rem: http://docs.justia.com/cases/federal/district-courts/florida/flmdce/8:2006cv01685/186117/1/

To be fair, Odyssey Marine, in their Answer to the Intervening Complaint filed by Bray, effectively "Denied" that they found the shipwreck using Bray's research. But they did admit that they were looking for the Merchant Royal and had obtained information about it "through other sources" (other than Bray's research, that is).

Now, having said all that, only Odyssey Marine knows for sure. I may have jumped to the wrong conclusion or Odyssey may have gone to the site suggested by Mr. Bray and other sources and found a completely different ship. But now there is more than mere speculation that Odyssey Marine was looking for and may have found the Merchant Royal.

The first indications from the press concerning yesterday's Protective Order was that it was some sort of victory for Spain. The press seemed to put a spin on that Odyssey was forced to share information concerning the Black Swan and the other two sites.

Even Spain's lead counsel couldn't resist: "We're very pleased the court ruled in our favor," says James Goold, the attorney representing the Spanish government. "It shows that the court recognizes the need to move quickly to establish the identity of the ship."

In fact, Odyssey Marine has wanted to share the information with Spain since the beginning of the legal wranglings. The only obstacle was Spain's refusal to sign a Confidentiality Agreement, which Odyssey had insisted on. Yesterday's Protective Order was the same as a Confidentiality Agreement.

Odyssey Marine has now issued a Press Release on yesterday's ruling:
http://biz.yahoo.com/bw/080111/20080111005479.html?.v=1

In it Odyssey explains the importance of the Protective Order: "The Company had offered this information to Spain since the beginning of the legal process, but insisted that a Confidentiality Agreement or a Protective Order was in place that would serve to protect information which might endanger the site if leaked or disclosed."

To me, the real highlight of the PR was this: "Magistrate Pizzo indicated at the hearing that further operations at the sites by Odyssey were authorized and that any interference by Spain may result in sanctions under the Order. The Court also emphasized that in the event of a breach of confidentiality or violation of the Protective Order, the Court could grant whatever remedy it may deem appropriate, including dismissal of Spain's claim."

The importance of this statement by Judge Pizzo cannot be overemphasized. Work can continue at the sites. Odyssey does not have to wait until the conclusion of the court cases. Spain cannot further harass Odyssey's ships in doing their work.

If you have been following the Black Swan story you will remember Spain "arresting" the 'Odyssey Explorer' and the 'Ocean Alert' as they were leaving the port of Gibraltar. Spain even went so far as to put "crime tape" around the Zeus II, the Explorer's ROV, which is used in deep sea recovery operations. Now Spain has to behave itself or risk losing the cases outright.

I'd say this is clearly a victory and a step forward for Odyssey Marine and a setback for Spain.

"Greed is Good" - Gordon Gekko

"Greed is all right, by the way. I want you to know that. I think greed is healthy. You can be greedy and still feel good about yourself." - Ivan Boesky

The oceanographer who discovered what may be the richest shipwreck treasure in history has agreed to pay $216,355 in an insider-trading settlement with federal regulators.

The Securities and Exchange Commission on Thursday announced a civil settlement with Ernesto Tapanes, an oceanographic consultant after accusing him of illegally profiting from his find.

Tapanes is an independent consultant but has worked exclusively for Odyssey Marine since 2002, according to the SEC. It is not known what his payout on the shipwreck find would be.

Greg Stemm, the chief executive of Tampa, Fla.-based Odyssey Marine, told The Associated Press he didn't know whether Tapanes would continue to work for the shipwreck excavation company.

“The board will look at it,” he said, noting that the SEC case did not involve the company.

In a statement, the company said, “Mr. Tapanes is one of many independent consultants to Odyssey Marine Exploration and is not a direct employee. The company is not aware of any SEC investigations into any of the company's employees, officers or directors, and has no reason to expect any in the future.”

Original Complaint Filed by the SEC: http://www.pdfdownload.org/pdf2html/pdf2html.php?url=http%3A%2F%2Fwww.sec.gov%2Flitigation%2Fcomplaints%2F2008%2Fcomp20431.pdf&images=yes

WASHINGTON (Reuters) - When an exploration team member discovered an anomaly on the ocean floor that turned out to be a $500 million shipwreck, he found a way to get his own share of the booty -- insider trading, according to the U.S. regulators who nabbed him.

The U.S. Securities and Exchange Commission said on Thursday that Ernesto Tapanes, 39, agreed to pay more than $216,000 to settle insider trading charges in the case involving the 18th century shipwreck, code-named Black Swan.

The SEC said Tapanes was working for Odyssey Marine Exploration Inc as an oceanographic surveying consultant in March 2007 when he identified and photographed an anomaly off the coast of Gibraltar.

Excavation efforts soon uncovered more than $500 million worth of silver and gold coins, the largest collection of coins ever excavated from a historical shipwreck site, the SEC said.

The shipwreck is the subject of a federal lawsuit, with Spain contending it is entitled to the treasure if it comes from one of its sunken ships, or if the treasure was removed from its territorial waters.

A federal judge ruled earlier this month that Odyssey Marine must reveal to Spain the exact location of the shipwreck and the items recovered from it.

At the time of Tapanes' discovery, the company kept the Black Swan a closely guarded secret for weeks and required its workers to sign a confidentiality agreement and to not trade in company stock.

The SEC said Tapanes signed the agreement on April 4, 2007, and that same day started buying Odyssey Marine stock through his E*Trade account.

In total, Tapanes bought 42,000 shares of stock from April 4 through May 15, 2007, the agency said.

Three days after that, Odyssey Marine issued a press release about its discovery and excavation of 17 tons of coins and other artifacts from the Black Swan.

The stock soared that day, closing up almost 81 percent, and continued to rise for several more days.

The SEC said Tapanes started selling his entire Odyssey Marine holdings after the announcement, reaping more than $107,000 in profits.

"His trading essentially was pretty flagrant," said Teresa Verges, assistant enforcement director in the SEC's Miami office.

Contact information for Tapanes, a Canadian citizen with residences in Canada and Florida, could not immediately be obtained.

Verges said Tapanes was not represented by an attorney in the SEC case and might currently be out at sea. Tapanes settled without admitting or denying the charges.