2d: To secure a patent, in the name of Robert Fulton; to deposit every necessary drawing, model and specification, and the patent property when granted was to be divided in value into one hundred shares, half of which should be owned by each partner, and all profits equally shared.
3d: To go to England to construct an experimental boat,—if possible borrowing an engine,—the cost of such boat, five hundred pounds English currency, to be provided by Livingston. If the boat failed of success, Fulton was to repay half the sum with seven per cent interest added; if it succeeded, Fulton was to go to America, obtain a patent, and build a boat; his “reasonable expenses” to be part of the general expense.
The contract continued as follows:
4th: When the work is finished, either partner may dispose of, or sell, any number of shares less than forty, but the purchasers, or shareholders, are to have no vote in the management of the business. All extensions to be paid from revenue received, and the profits equally divided twice a year.
5th: The partnership is to continue while the patent lasts, that is, fourteen years, or as long a term as it extends; at its close, all boats, warehouses and other property to belong to the shareholders.
6th: If Fulton or Livingston die before the termination of the patent, each heir or assign, holding twenty shares, shall become an active partner with power to act.
7th: Livingston reserves the right to withdraw from the partnership any time after his five hundred pounds have been spent in the first experiment, but is to be considered a partner until he sends notice in writing to Fulton.
It is evident that the document was drawn by Livingston, who certainly made a good bargain. The sole responsibility he took upon himself was the investment of five hundred pounds—twenty-five hundred dollars—with a return of one-half the amount, plus seven per cent interest, if Fulton failed to provide the invention. On the other hand, he was entitled to receive dividends as long as the patent rights could be extended, if the invention proved, as it did, financially productive.
For practical reasons, Fulton decided to build his trial boat in Paris, instead of going over to England. This decision was probably made when he found that he could borrow, or rent, an engine. Fulton had to consider expense, for he had spent the money he received from the Panorama upon his torpedo-boats; and his active mind conceived such vast schemes that they seemed too costly to all his friends, except Barlow; at times, even he advised against too great ventures. On July 26th he prudently wrote as follows: