Document:

Consent of Deloitte & Touche Espana, S.L.

 EXHIBIT 10.1 
  
 Consent of Deloitte & Touche España, S.L. 

 Rodriguez Arias, 79 
 48008
Bilbao 
 España 
  
 Tel: +(34) 944 44 70 00 
 Fax: +(34) 944 70 08 23 
 www.deloitte.es 
 Deloitte 
 & Touche 
  
  
 INDEPENDENT AUDITORS’ CONSENT 
  
 We consent to the incorporation by reference in Registration Statements No. 333-13552, No.
333-07182, No. 333-06986 and No. 333-54232 on Form F-3 of Banco Bilbao Vizcaya Argentaria, S.A. of our report dated February 10, 2003, except for the Note 32 as to which the date is June 19, 2003, relating to the consolidated balance sheets of Banco
Bilbao Vizcaya Argentaria, S.A. and its consolidated affiliates as of December 31, 2002, and 2001, and the consolidated statements of income of Banco Bilbao Vizcaya Argentaria, S.A. and its consolidated affiliates for the years ended December 31,
2002, 2001 and 2000 appearing in this Annual report on Form 20-F of Banco Bilbao Vizcaya Argentaria (the “Bank”) for the year ended December 31, 2002. 
  

 
 /s/    Deloitte & Touche
España, S..L. 
  
 DELOITTE & TOUCHE
ESPAÑA, S.L. 
  
  
 Madrid, Spain 
 June 26, 2003Form of Shipbuilding Contract

 Exhibit 4.6 
  

FORM OF 
  
 SHIPBUILDING CONTRACT 
  
  

FOR 
  
 THE CONSTRUCTION OF 
  
  
 [                         ]

  
  
 HULL NO. [                         ] 
  
  
 BETWEEN 
  
  
 [                         ] 
  
  
 (AS BUYER) 
  
 AND 
  
  
 HYUNDAI MIPO DOCKYARD CO., LTD. 
 (AS BUILDER) 
  

 TABLE OF CONTENTS 
  

	 	  	 	  	Page

	 ARTICLE I:
	  	DESCRIPTION AND CLASS	  	2
			
	 ARTICLE II:
	  	CONTRACT PRICE	  	5
			
	 ARTICLE III:
	  	ADJUSTMENT OF THE CONTRACT PRICE	  	5
			
	 ARTICLE IV:
	  	INSPECTION AND APPROVAL	  	8
			
	 ARTICLE V:
	  	MODIFICATIONS, CHANGES AND EXTRAS	  	12
			
	 ARTICLE VI:
	  	TRIALS AND COMPLETION	  	14
			
	 ARTICLE VII:
	  	DELIVERY	  	17
			
	 ARTICLE VIII:
	  	DELAYS AND EXTENSIONS OF TIME (FORCE MAJEURE)	  	19
			
	 ARTICLE IX:
	  	WARRANTY OF QUALITY	  	21
			
	 ARTICLE X:
	  	PAYMENT	  	24
			
	 ARTICLE XI:
	  	BUYER’S DEFAULT	  	28
			
	 ARTICLE XII:
	  	BUILDER’S DEFAULT	  	30
			
	 ARTICLE XIII:
	  	BUYER’S SUPPLIES	  	31
			
	 ARTICLE XIV:
	  	ARBITRATION	  	32
			
	 ARTICLE XV:
	  	INSURANCE	  	34
			
	 ARTICLE XVI:
	  	SUCCESSORS AND ASSIGNS	  	35
			
	 ARTICLE XVII:
	  	TAXES AND DUTIES	  	35
			
	 ARTICLE XVIII:
	  	PATENTS, TRADEMARKS AND COPYRIGHTS	  	36
			
	 ARTICLE XIX:
	  	INTERPRETATION AND GOVERNING LAW	  	36
			
	 ARTICLE XX:
	  	NOTICE	  	37
			
	 ARTICLE XXI:
	  	EFFECTIVENESS OF THIS CONTRACT	  	37
			
	 ARTICLE XXII:
	  	EXCLUSIVENESS	  	37
			
	 EXHIBIT A
	  	LETTER OF GUARANTEE	  	 
			
	 EXHIBIT B
	  	PERFORMANCE GUARANTEE	  	 

  

 i 

 SHIPBUILDING CONTRACT 
  
 THIS CONTRACT, made on this [        
         ] by and between [                  ], a corporation incorporated and existing under the laws of
[                  ] with its principal office at [                  ] (hereinafter
called the “BUYER”), the party of the first part and HYUNDAI MIPO DOCKYARD CO., LTD., a company organized and existing under the laws of the Republic of Korea, having its principal office at 1381, Bangeo-Doug, Dong-Ku, Ulsan, Korea
(hereinafter called the “BUILDER”), the party of the second part, 
  
 WITNESSETH: 
  
 In consideration of the
mutual covenants contained herein, the BUILDER agrees to design, build, launch, equip and complete one [                  ] as described in Article I hereof (hereinafter
called the “VESSEL”) at the BUILDER’s shipyard in Ulsan, Korea (hereinafter called the “SHIPYARD”) and to deliver and sell the VESSEL to the BUYER, and the BUYER agrees to accept delivery of and purchase from the BUILDER the
VESSEL, according to the terms and conditions hereinafter set forth: 
  
  

 1 

 ARTICLE I: DESCRIPTION AND CLASS 
  
 1.     DESCRIPTION 
  
 The VESSEL shall have The BUILDER’s Hull No. [        
         ] and shall be designed, constructed, equipped and completed in accordance with the BUILDER’s standard practice current as of the date of this CONTRACT and the specifications No.
[                 ] dated [                 ] and the general arrangement plan No.
[                  ] dated [                  ] along with the Attachments, endorsed on
[                 ] : (a) Owners inspection scheme [                 ] (b) Coating
specification for cargo and slop tank for [                 ] (c) Builders reply to Owner’s comments for [        
        ]. (d) Makers list (e) Appendix I containing index of Applicable EXXON MOBIL safety criteria, Edition 2002 attached thereto (hereinafter called respectively the “SPECIFICATIONS” and the
“PLAN”) signed by both parties, which shall constitute an integral part of this CONTRACT although not attached hereto. 
  
 The SPECIFICATIONS and the PLAN are intended to explain each other and anything shown on the PLAN and not stipulated in the SPECIFICATIONS or anything
stipulated in the SPECIFICATIONS and not shown on the PLAN shall be deemed and considered as if included in both. Should there be any inconsistencies or contradictions between the SPECIFICATIONS and the PLAN, the SPECIFICATIONS shall prevail. Should
there be any inconsistencies or contradictions between this CONTRACT and the SPECIFICATIONS, this CONTRACT shall prevail. 
  
 2.     BASIC DIMENSIONS AND PRINCIPAL PARTICULARS OF THE VESSEL 
  
 (a) The basic dimensions and principal particulars of the VESSEL shall be: 
  
 Length, overall 
 Length, between perdediculars 
 Breadth,
moulded 
 Depth to Upper Deck, moulded 
 Design draft, moulded, in seawater of specific gravity of 1.025 
 Scantling draft, moulded, in seawater of specific gravity of 1.025

 Deadweight on the above moulded scantling draft of 10.5 M 
 Main propelling machinery: 
 Service speed at 9.0 meters design draft at the condition of clean bottom and in
calm and deep sea with main engine developing a NCR of 9,890 
 B.H.P. with fifteen percent (15%)sea margin 
  

 2 

 Fuel consumption of the main engine applying I.S.O. reference conditions to the result of official shop
test at a MCR of 11,640 B.H.P. using marine diesel oil having lower calorific value of 10,200 Kcal per Kg. 
  
 The details of the above particulars as well as the definitions and method of measurements and calculations are as indicated in the SPECIFICATIONS.

  
 (b)     The dimensions may be slightly
modified by the BUILDER, who also reserves the right to make changes to the SPECIFICATIONS and the PLAN if found necessary to suit the local conditions and facilities of the SHIPYARD, the availability of materials and equipment, the introduction of
improved production methods or otherwise, subject to the approval of the BUYER which the BUYER shall not withhold unreasonably in the absence of detrimental effect on the BUYER. 
  
 3.     CLASSIFICATION, RULES AND REGULATIONS 
  
 (a)     The VESSEL including its machinery, equipment and
outfittings shall be built in compliance with the rules and regulations of Lloyd Register of Shipping (hereinafter called the “CLASSIFICATION SOCIETY”) current as of the date of this CONTRACT, to be classed and registered as +100A1, Double
Hull Oil/Chemical tanker ESP, Ship Type 3, +LMC, UMS, EP(V), COW, IGS, SPM, LI, PCWBT, SHIPRIGHT(SDA, FDA, CM), SCM, IWS. 
  
  
 The Vessel shall also comply with the rules, regulations and requirements of
other regulatory bodies as described in the SPECIFICATIONS. 
  
  
 All major plans, materials and workmanship to the extent required shall be subject to inspection and rest by the CLASSIFICATION SOCIETY and other
regulatory bodies as described in the SPECIFICATIONS and the BUILDER shall ensure that all classification and other regulatory inspections take place in good time and with satisfactory results. 
  
 (b)     The BUILDER shall arrange with the CLASSIFICATION
SOCIETY for the assignment by the CLASSIFICATION SOCIETY of representative (s) to the VESSEL during construction. 
  
 All fees and charges incidental to classification of the VESSEL in compliance with the above specified rules, regulations and requirements of this
CONTRACT shall be for the account of the BUILDER. 
  
 (c)     The decision of the CLASSIFICATION SOCIETY as to whether the VESSEL complies with the regulations of the CLASSIFICATION SOCIETY shall be final and binding upon the BUILDER and the BUYER provided that in the case
of dispute that decision is of the Head office of the CLASSIFICATION SOCIETY. 
  

 3 

  
 4    .
SUBCONTRACTORS AND SUPPLIES 
  
 The BUILDER shall have the
right to subcontract part of the construction work thereof (but shall give prior prompt written notice to the BUYER of any such subcontracting) in accordance with the SPECIFICATIONS and PLAN, provided always however that the construction of (a) the
main hull structure and assembly of the VESSEL must be carried out at the SHIPYARD by the BUILDER and (b) the accommodation of the deck house, the bulbous bow, the stern frame and parts of the lower stools shall take place in Korea. The BUILDER
shall not use for the construction of the VESSEL steel made in China. In any event the BUILDER shall remain fully responsible for any part of the VESSEL and the construction work subcontracted in accordance with this CONTRACT and/or the
SPECIFICATIONS and PLAN. 
  
 No sub-contract shall bind or purport
to bind the BUYER. 
  
 All sub-contractors howsoever employed or
engaged are hereby declared and agreed to be sub-contractors employed or engaged by the BUILDER and the BUILDER agrees that it is and shall remain fully responsible for and liable in respect of any sub-contractors and/or their acts or omissions and,
without prejudice to the generality of the foregoing, the BUILDER shall ensure control over supervision and scheduling of the all work related to this VESSEL done by sub-contractors. 
  
 The BUILDER hereby agrees that if any of its employees, servants or agents or those of the sub-contractors appointed
pursuant to this CONTRACT shall, in the reasonable opinion of the BUYER’S REPRESENTATIVE, not be carrying out properly their duties and responsibilities under or pursuant to the tests of this CONTRACT, the BUYER shall be entitled (by giving
written notice to the BUILDER) to draw the same to the attention of the BUILDER and, if the BUYER considers it necessary, to request the BUILDER to replace such person(s) if the same are its own employees, servants or agents, or to use its best
endeavors to replace such person(s) if employees, servants or agents of a Sub-Contractor. The BUILDER shall investigate any such request, and if found justified take appropriate action. Any such replacement shall be within such a time scale so as to
ensure that the BUILDER continues to carry out all of its duties and obligations under or pursuant to this CONTRACT. 
  
 The BUYER will not contract directly with the suppliers in respect of items or materials in the Makers List. 
  
 5.     NATIONALITY OF THE VESSEL 
  
 The VESSEL shall be registered by the BUYER at its own cost and expense under
the laws of [                 ] at the time of its delivery and acceptance hereunder. 
  
 ARTICLE II: CONTRACT PRICE 
  
 The contract price of the VESSEL delivered to the BUYER at the SHIPYARD shall be [ ] (hereinafter called the “CONTRACT PRICE”) which shall be
paid plus any increases or less any decreases due to adjustment or modifications, if any, as set forth in this CONTRACT. The above CONTRACT PRICE shall include payment for services in the inspection, tests, survey and classification of the VESSEL
which will be rendered by the CLASSIFICATION 
  

 4 

  
 SOCIETY and/or regulatory bodies as referred
to in Article I clause 3 and shall not include the cost of the BUYER’s supplies as stipulated in Article XIII. 
  
 The CONTRACT PRICE also includes all costs and expenses for supplying all necessary drawings as stipulated in the SPECIFICATIONS except those to be
furnished by the BUYER for the VESSEL in accordance with the SPECIFICATIONS. 
  
 ARTICLE III: ADJUSTMENT OF THE CONTRACT PRICE 
  
 The CONTRACT PRICE of the VESSEL shall be adjusted as hereinafter set forth in the event of the following contingencies. It is hereby understood by both parties that any adjustment of the CONTRACT PRICE as provided
for in this Article is by way of liquidated damages and not by way of penalty. 
  
 1.     DELAYED DELIVERY 
  
 (a)     No adjustment shall be made and the CONTRACT PRICE shall remain unchanged for the first thirty (30) days of the delay in delivery of the VESSEL [ending as of 12 o’clock midnight Korean
Standard Time on the thirtieth (30th) day of delay] beyond the delivery date calculated as provided in Article VII.1
hereof. (hereinafter called the “Delivery Date”). 
  
 (b)     If delivery of the VESSEL is delayed more than thirty (30) days beyond the Delivery Date, then, beginning at midnight of the thirtieth (30th) day after the Delivery Date, the CONTRACT PRICE of the VESSEL shall be reduced by [        
        ] for each full day of delay. However, unless the parties agree otherwise, the total amount of deduction from the CONTRACT PRICE shall not exceed the amount due to cover the delay of one hundred and
fifty (150) days after thirty (30) days of the delay in delivery of the VESSEL at the rate of deduction as specified hereinabove. 
  
 (c)     But, if the delay in delivery of the VESSEL continues for a period of more than one hundred and eighty (180) days beyond the
Delivery Date then, in such event, and after such period has expired, the BUYER may, at its option, cancel this CONTRACT by serving upon the BUILDER a notice of cancellation by letter or facsimile to be confirmed by a registered letter via airmail
directed to the BUILDER at the address given in this CONTRACT. Such cancellation shall be effective as of the date the notice thereof is received by the BUILDER and the BUILDER, upon receipt of such notice shall promptly refund to the BUYER, by
telegraphic transfer, in U.S.Dollars, all the installments of the CONTRACT PRICE paid by the BUYER together with interest as provided in paragraph 5 of Article X hereof and BUYER’s Supplies delivered to the BUILDER. The transfer and such other
bank charges of such refund shall be for the Builder’s account. The aforementioned refund by the BUILDER to the BUYER shall forthwith discharge all obligations duties and liabilities of each of the parties to the other under this CONTRACT.

  
 (d)     For the purpose of this Article,
the delivery of the VESSEL shall be deemed to be delayed when and if the VESSEL, after taking into full account extension of the Delivery Date or permissible delays as provided in Article V, VI, VIII, XI or elsewhere in this 
  

 5 

  
 CONTRACT, is delivered beyond the date upon
which delivery would then be due under the terms of this CONTRACT. 
  
 2.     INSUFFICIENT SPEED 
  
 (a)     The CONTRACT PRICE of the VESSEL shall not be affected or changed, if the actual speed, as determined by trial runs more fully described in Article VI hereof, is less than the speed required under the terms of
this CONTRACT and the SPECIFICATIONS (the “Guaranteed Speed”) provided such deficiency in actual speed is not more than three-tenths (3/10) of a knot below the Guaranteed Speed. 
  
 (b)     However, as for the deficiency of more than three-tenths (3/10) of a knot in actual speed below
the Guaranteed Speed, the CONTRACT PRICE shall be reduced by [               ] for each one-tenth (1/10) of a knot in excess of the said three-tenths (3/10) of a knot of
deficiency in speed (fractions of less than one-tenth (1/10) of a knot shall be regarded as a full one-tenth (1/10) of a knot). However, unless the parties agree otherwise, the total amount of reduction from the CONTRACT PRICE shall not exceed the
amount due to cover the deficiency of seven-tenths (7/10) of a knot below the Guaranteed Speed at the rate of reduction as specified above. 
  
 (c)     If the deficiency in actual speed of the VESSEL is more than seven-tenths (7/10) of a knot below the Guaranteed Speed, then
the BUYER, at its option, may, subject to the Builder’s right to effect alterations or corrections as provided in Article VI hereof, cancel thus CONTRACT or may accept the VESSEL at a reduction in the CONTRACT PRICE as above provided for
seven-tenths (7/10) of a knot of deficiency only. 
  
 3.     EXCESSIVE FUEL CONSUMPTION 
  
 (a)     The CONTRACT PRICE shall not be affected or changed by reason of the fuel consumption of the VESSEL’s mans engine, as determined by the engine manufacturer’s shop trial as per the SPECIFICATIONS being
more than the guaranteed fuel consumption of the VESSEL’s main engine required under the terms of this CONTRACT and the SPECIFICATIONS (the “Guaranteed Fuel Consumption”), if such excess is not more than five per cent (5%) over the
Guaranteed Fuel Consumption. 
  
 (b)    
However, as for the excess of more than five per cent (5%) in the actual fuel consumption over the Guaranteed Fuel Consumption, the CONTRACT PRICE shall be reduced by [        
        ] for each one per cent (1%) excess in fuel consumption in excess of the said five per cent (5%) increase in fuel consumption, (fractions of less than one per cent (1%) shall be regarded as a full one
percent (1%)). However, unless the parties agree otherwise, the total amount of reduction from the CONTRACT PRICE shall not exceed the amount due to cover the excess of ten percent (10%) over the Guaranteed Fuel Consumption at the rate of reduction
as specified above. 
  
 (c)     If such actual
fuel consumption exceeds the Guaranteed Fuel Consumption by more than ten per cent (10%), the BUYER, at its option, may, subject to the BUILDER’s right to effect alterations or corrections as specified in Article VI hereof, cancel this

  

 6 

  
 CONTRACT or may accept the VESSEL at a
reduction in the CONTRACT PRICE as above provided, for the ten per cent (10%) increase only. 
  
 4.     DEADWEIGHT BELOW CONTRACT REQUIREMENTS 
  
 (a)     The CONTRACT PRICE shall not be affected or changed, if the actual deadweight tonnage of the VESSEL is less than 370 metric
tons, below the deadweight tonnage of 37,000 metric tons on the moulded scantling draft of 10.5 meters required by this CONTRACT and the SPECIFICATIONS (the “Guaranteed Deadweight”). 
  
 (b)     In the event that the deficiency in the actual
deadweight tonnage of the VESSEL is 370 metric tons or more below the Guaranteed Deadweight, then the CONTRACT PRICE of the VESSEL shall be reduced by the amount of [ ] for each full one (1) metric ton of deficiency in deadweight in excess of 370
metric tons. 
  
 (c)     However, unless the
parties agree otherwise, the total amount of deduction from the CONTRACT PRICE shall not exceed the amount due to cover a deficiency of 740 metric tons below the Guaranteed Deadweight. 
  
 (d)     In the event that there should be a deficiency in the VESSEL’s actual deadweight tonnage of
more than 740 metric tons below the Guaranteed Deadweight, the BUYER, at its option, may, subject to the BUILDER’s right to effect alterations or corrections as specified in Article VI hereof, rescind this CONTRACT in accordance with the
provisions of Article X (Rejection and Rescission by the Buyer) of this CONTRACT or may accept the VESSEL at a reduction in the CONTRACT PRICE as provided for above. 
  
 5.     METHOD OF ADJUSTMENT OF CONTRACT PRICE 
  
 All adjustment of Contract Price provided in this Article shall be balanced
by adjustment of the fifth installment of the CONTRACT PRICE due upon delivery of the VESSEL. 
  
 6.     EFFECT OF CANCELLATION 
  
 It is expressly understood and agreed by the parties hereto that in any case, if the BUYER cancels this CONTRACT under this Article, the BUYER shall not be entitled to any liquidated damages. 
  
 ARTICLE IV: INSPECTION AND APPROVAL 
  
 1.     APPOINTMENT OF BUYER’S REPRESENTATIVE

  
 The BUYER shall timely despatch to and maintain at the
SHIPYARD, at its own cost, expense and risk, one or more representatives (each such representative or, as the context requires, all such representatives, being hereinafter called the “BUYER’S REPRESENTATIVE”), who shall be duly
accredited in writing by the BUYER to attend inspections and tests relating to, and to supervise the construction of the VESSEL, her equipment and all accessories. Before the commencement of any item of work under this CONTRACT, the BUILDER shall,
whenever reasonably required, previously exhibit, furnish to, and within the 
  

 7 

 limits of the BUYER’S REPRESENTATIVE’s authority, secure the approval from the BUYER’S REPRESENTATIVE of
any and all plans and drawings prepared in connection therewith. Upon appointment of the BUYER’S REPRESENTATIVE, the BUYER shall notify the BUILDER in writing of the name and the scope of the authority of the BUYER’S REPRESENTATIVE. The
BUYER may appoint such other persons as the BUYER shall reasonably determine to be additional BUYER’S REPRESENTATIVE for the purpose of witnessing the trial run of the VESSEL pursuant to Article VI. 
  
 2. The BUILDER shall keep the BUYER’S REPRESENTATIVE well informed of
the schedule of tests and inspections both inside the shipyard and with respect to sub-contractors works to ensure that the BUYER’S REPRESENTATIVE is able to attend to such matters. 
  
 3. AUTHORITY OF THE BUYER’S REPRESENTATIVE 
  
 The BUYER’S REPRESENTATIVE shall, at all times during working hours of the construction until delivery of the VESSEL,
have the right to inspect the VESSEL, her equipment and all accessories, and work in progress, or materials utilized in connection with the construction of the VESSEL, wherever such work is being done or such materials are stored, for the purpose of
determining that the VESSEL, her equipment and accessories are being constructed in accordance with the terms of this CONTRACT and/or the SPECIFICATIONS and the PLAN. 
  
 The BUYER’S REPRESENTATIVE shall to the extent, and within the limits of the authority conferred upon him by the BUYER,
make decisions or give advice to the BUILDER on behalf of the BUYER promptly on all problems arising out of, or in connection with, the construction of the VESSEL and generally act in a reasonable manner with a view to cooperating with the BUILDER
in the construction process of the VESSEL within the limits of the BUYER’S REPRESENTATIVE’s authority. 
  
 The decision, approval or written advice of the BUYER’S REPRESENTATIVE within such limits shall be deemed to have been given by the BUYER and once
given shall not be withdrawn, revoked or modified except with consent of the BUILDER. The BUYER’S REPRESENTATIVE shall notify the BUILDER promptly in writing of his discovery of any construction or materials, which he believes do not or will
not conform to the requirements of the CONTRACT and the SPECIFICATIONS or the PLAN and likewise advise and consult with the BUILDER on all matters pertaining to the construction of the VESSEL, as he may deem necessary. 
  
 However, if the BUYER’S REPRESENTATIVE fails to submit to the BUILDER
without delay any such demand concerning alterations or changes with respect to the construction, arrangement or outfit of the VESSEL, which the BUYER’S REPRESENTATIVE has examined, inspected or attended at the test thereof under this CONTRACT
or the SPECIFICATIONS, the BUYER’S REPRESENTATIVE shall be deemed to have approved the same and shall be precluded from making any demand for alterations, changes, or complaints with respect thereto at a later date. 
  

 8 

 If the BUILDER has good cause to object to the manner in which the BUYER’S REPRESENTATIVE is
carrying on his duties, the BUILDER may give notice to the BUYER of such objection and the BUYER will investigate the same and if found satisfied will either procure that the BUYER’S REPRESENTATIVE carries out his duties in conformity to this
CONTRACT, or will replace the BUYER’S REPRESENTATIVE. 
  
 No
act or omission of the BUYER’S REPRESENTATIVE or his assistants shall, in any way, diminish the liability of the BUILDER under Article IX (WARRANTY OF QUALITY) or relieve the BUILDER of his obligation in every respect to comply with this
CONTRACT and with all the requirements that the CLASSIFICATION SOCIETY and/or other regulatory bodies may impose by virtue of the rules and regulations mentioned in Article I of this CONTRACT before delivery of the VESSEL. 
  
 The BUILDER shall comply with any demand which is not contradictory to this
CONTRACT and the SPECIFICATIONS or the PLAN, provided that any and all such demands by the BUYER’S REPRESENTATIVE with regard to construction, arrangement and outfit of the VESSEL shall be submitted in writing to the authorized representative
of the BUILDER. The BUILDER shall notify the BUYER’S REPRESENTATIVE of the names of the persons who are from time to time authorized by the BUILDER for this purpose. 
  
 It is agreed upon between the BUYER and the BUILDER that the modifications, alterations or changes and other measures
necessary to comply with such demand may be effected at a convenient time and place at the BUILDER’s reasonable discretion in view of the construction schedule of the VESSEL. 
  
 In the event that the BUYER’S REPRESENTATIVE shall advise the BUILDER that he has discovered or believes the
construction or materials do not or will not conform to the requirements of this CONTRACT and the SPECIFICATIONS or the PLAN, and the BUILDER shall not agree with the views of the BUYER’S REPRESENTATIVE in such respect, either the BUYER or the
BUILDER may, with the agreement of the other party, seek an opinion of the Head office of the CLASSIFICATION SOCIETY or failing such agreement, request an arbitration in accordance with the provisions of Article XIV hereof. The Head Office of the
CLASSIFICATION SOCIETY or the arbitration tribunal, as the case may be, shall determine whether or not a nonconformity with the provisions of this CONTRACT, the SPECIFICATIONS and the PLAN exists. If the Head Office of the CLASSIFICATION SOCIETY or
the arbitration tribunal, as the case may be, enters a determination in favour of the BUYER, then in such case the BUILDER shall make the necessary alterations or changes, or if such alterations or changes cannot be made in time to meet the
construction schedule for the VESSEL, and the BUYER so agrees, (such agreement not to be unreasonably withheld or delayed), the BUILDER shall make fair and reasonable adjustment of the CONTRACT PRICE in lieu of such alterations and changes.

  
 If the Head Office of the CLASSIFICATION SOCIETY or the
arbitration tribunal, as the case may be, enters a determination in favour of the BUILDER, then the time for delivery of the VESSEL shall be extended for the period of delay in construction, if any, occasioned by such proceedings, and the BUYER
shall compensate the BUILDER for the proven loss and damages incurred by the BUILDER as a result of the dispute herein referred to. 
  

 9 

 4. APPROVAL OF DRAWINGS 
  
 (a) The BUILDER will submit to the BUYER as soon as possible after signing this CONTRACT a list of drawings and plans for
approval by the BUYER and schedule for their production and approval (“the Drawings Schedule”). 
  
 (b) The BUILDER shall submit to the BUYER three (3) copies of each of the plans and drawings to be submitted to the BUYER for its approval at its address
as set forth in Article XX hereof. The BUYER shall, within twenty eight (28) days after receipt thereof despatch to the BUILDER one (1) copy of such plans and drawings with the approval or comments, if any, of the BUYER. A list of the plans and
drawings to be so submitted to the BUYER shall be mutually agreed upon between the parties hereto. 
  
 (c) When and if the BUYER’S REPRESENTATIVE shall have been sent by the BUYER to the SHIPYARD in accordance with Paragraph 1 of this Article, and the
BUYER so agrees (such agreement not to be unreasonably withheld of delayed), the BUILDER may submit the remainder, if any, of the plans and drawings in the agreed list, to the BUYER’S REPRESENTATIVE for his approval, unless otherwise agreed
upon between the parties hereto. 
  
 (d) The BUYER’S
REPRESENTATIVE shall, within ten (10) days after receipt thereof, despatch to the BUILDER one (1) copy of such plans and drawings with his approval or comments written thereon, if any. Approval by the BUYER’S REPRESENTATIVE of the plans and
drawings duly submitted to him shall be deemed to be the approval by the BUYER for all purpose of this CONTRACT. 
  
 (e) In the event that the BUYER or the BUYER’S REPRESENTATIVE shall fail to return the plans and drawings to the BUILDER within the time limit as
hereinabove provided, such plans and drawings shall be deemed to have been automatically approved without any comment. In the event the plans and drawings submitted by the BUILDER to the BUYER or the BUYER’S REPRESENTATIVE in accordance with
this Article do not meet with the BUYER’S or the BUYER’S REPRESENTATIVE’s approval, the matter may be submitted by either party hereto for determination pursuant to Article XIV hereof. 
  
 If the BUYER’s comments on the plans and drawings that are returned to
the BUILDER by the BUYER within the said time limit are not clearly specified or detailed, the BUILDER shall notify the BUYER to such effect and if the BUYER does not respond within three (3) days then the BUILDER shall be entitled to place its own
interpretation on such comments in implementing them. 
  
 5.
SALARIES AND EXPENSES 
  
 All salaries and expenses of the
BUYER’S REPRESENTATIVE or any other person or persons employed by the BUYER hereunder shall be for the BUYER’s account. 
  
 6. RESPONSIBILITY OF THE BUILDER 
  
 (a) The BUILDER shall provide the BUYER’S REPRESENTATIVE and his assistants free of charge with suitably furnished office space or in the immediate
vicinity of, the 
  

 10 

 SHIPYARD together with three (3) independent telephone lines as may be necessary to enable the BUYER’S
REPRESENTATIVE and his assistants to carry out their work under this CONTRACT. However, the BUYER shall pay for the photocopy, telephone, telex or facsimile facilities used by the BUYER’S REPRESENTATIVE or his assistants. 
  
 The BUILDER, its employees, agents and subcontractors, during its, or their,
working hours, until delivery of the VESSEL, shall arrange for the BUYER’S REPRESENTATIVE and his assistants to have free and ready access to the VESSEL, her equipment and accessories, and to any other place (except the areas controlled for the
purpose of national security), where work is being done, or materials are being processed or stored in connection with the construction of the VESSEL including the premises of sub-contractors. The BUILDER shall give to the BUYER’S
REPRESENTATIVE assistance in respect of accommodation and transport, but always at BUYER’s cost. 
  
 The BUYER’S REPRESENTATIVE and his assistants or employees shall observe the work’s rules and regulations prevailing at the BUILDER’s and
its sub-contractor’s premises and shall coordinate with the BUILDER for the proper implementation of the agreed CONTRACT and SPECIFICATIONS. 
  
 The BUILDER shall promptly provide to the BUYER’S REPRESENTATIVE and/or his assistants and shall ensure that its sub-contractors shall promptly
provide all such information as he or they may reasonably request in connection with the construction of the VESSEL and her engines, equipment and machinery. 
  
 (b) The BUYER’S REPRESENTATIVE and his assistants shall at all times remain the employees of the BUYER The BUILDER shall not be liable to the BUYER
or the BUYER’S REPRESENTATIVE or to his assistants or to the BUYER’s employees or agents for personal injuries, including death, during the time they, or any of them, are on the VESSEL, or within the premises of either the BUILDER or its
sub-contractors, or are otherwise engaged in and about the construction of the VESSEL, unless, however, such personal injuries, including death, are caused by the negligence of the BUILDER, its sub-contractors, or its, or their employees or agents.
The BUILDER shall not be liable to the BUYER for damages to, or destruction of, property of the BUYER or of the BUYER’S REPRESENTATIVE or his assistants or the BUYER’s employees or agents, unless such damages, loss or destruction is caused
by the negligence of the BUILDER, its sub-contractors, or its or their employees or agents. 
  
 (c) Liability of the BUYER’S REPRESENTATIVES: 
  
 Neither the BUYER nor the BUYER’S REPRESENTATIVE shall be under any liability whatsoever for personal injuries, including death, to the BUILDER or its sub-contractors or their respective employees servants or
agents during the time the BUYER or the BUYER’S REPRESENTATIVE are on the VESSEL, within the premises of the BUILDER or its subcontractors, or otherwise engaged in and about the construction of the VESSEL, unless however, such personal
injuries, including death, are caused by the negligence of the BUYER’S 
  

 11 

 REPRESENTATIVE. Nor shall the BUYER or the BUYER’S REPRESENTATIVE be under any liability whatsoever
for damage to, or loss or destruction to the property of the BUILDER or its sub-contractors in Korea or elsewhere unless such damage loss or destruction is caused by the negligence of the BUYER’S REPRESENTATIVE. 
  
 ARTICLE V: MODIFICATIONS, CHANGES AND EXTRAS 
  
 1. HOW EFFECTED 
  
 Minor modifications or changes, including LRS ICE CLASS 1D and canceling
certain of the extra items earlier agreed, to the SPECIFICATIONS and the PLAN under which the VESSEL is to be constructed may be trade at any time thereafter by written agreement of the parties hereto. Any modification or change requested by the
BUYER which does not affect the frame-work of the SPECIFICATIONS shall be agreed to by the BUILDER if the BUYER agrees to adjustment of the CONTRACT PRICE, deadweight and/or cubic capacity, speed requirements, the Delivery Date and other terms and
conditions of this CONTRACT, reasonably required as a result of such modification or change. The BUILDER has the right to continue construction of the VESSEL on the basis of the SPECIFICATIONS and the PLAN until BUYER has agreed to such adjustments.
The BUILDER shall be entitled to refuse to make any alteration, change or modification of the SPECIFICATIONS and/or the PLAN requested by the BUYER, if the BUYER does not agree to the aforesaid adjustments within ten (10) days of the BUILDER’S
notification of the same to the BUYER, or, if, compliance with such request of the BUYER would cause an unreasonable disruption of the normal working schedule of the SHIPYARD. 
  
 The BUILDER, however, agrees to exert its efforts to accommodate such reasonable request by the BUYER so that the said
change(s) and modification(s) shall be made at a reasonable cost and within the shortest period of time reasonably possible. The aforementioned agreement to modify and change the SPECIFICATIONS and the PLAN may be effected by exchange of letters,
telexes or facsimiles manifesting the agreement. 
  
 The letters,
telexes, and facsimiles exchanged by the parties pursuant to the foregoing shall constitute an amendment to this CONTRACT and the SPECIFICATIONS or the PLAN under which the VESSEL shall be built. Upon consummation of such an agreement to modify and
change the SPECIFICATIONS or the PLAN, the BUILDER shall alter the construction of the VESSEL in accordance therewith including any addition to, or deduction from, the work to be performed in connection with such construction. 
  
 2. SUBSTITUTION OF MATERIAL 
  
 If any materials, machinery or equipment required by the SPECIFICATIONS and
the PLAN or otherwise under this CONTRACT for the construction of the VESSEL cannot be procured in time to meet the BUILDER’s construction schedule for the VESSEL, or are in short supply or are unreasonably high in price compared with the
prevailing international market price, the BUILDER may supply, subject to the BUYER’s prior written approval, other materials which are equally good and capable of meeting the requirements of the CLASSIFICATION SOCIETY and of the rules,
regulations, requirements and recommendations with which the 
  

 12 

 construction of the VESSEL must comply. Any agreement as to such substitution of materials shall be effected in the
manner provided in paragraph I of this Article. 
  
 3. CHANGES
IN RULES AND REGULATIONS 
  
 If the specified rules and
regulations with which the construction of the VESSEL is required to comply are altered or changed by the CLASSIFICATION SOCIETY or bodies authorized to make such alterations or changes, either the BUYER or the BUILDER, upon receipt of due notice
thereof, shall forthwith give notice thereof to the other party in writing. Thereupon, within ten (10) days after giving the notice to the BUILDER or receiving the notice from the BUILDER, the BUYER shall advise the BUILDER as to the alterations and
changes, if any, to be made on the VESSEL which the BUYER, in its sole discretion, shall decide. The BUILDER shall not be obliged to comply with such alterations and/or changes if the BUYER fails to notify the BUILDER of its decision within the time
limit stated above. 
  
 The BUILDER shall comply promptly with the
said request of the BUYER, provided that the BUILDER and the BUYER shall first agree upon: 
  
 (i) any increase or decrease in the CONTRACT PRICE of the VESSEL that is occasioned by such compliance 
  
 (ii) any extension or advancement in the Delivery Date of the VESSEL that is occasioned by such compliance 
  
 (iii) any increase or decrease in the deadweight and/or cubic capacity of
the VESSEL, if such compliance results in any increase or reduction in the deadweight and/or cubic capacity 
  
 (iv) adjustment of the speed requirements if such compliance results in any increase or reduction in the speed and 
  
 (v) any other alterations in the terms of this CONTRACT or of the
SPECIFICATIONS or the PLAN or both, if such compliance makes such alterations of the terms necessary. 
  
 Any delay in the construction of the VESSEL caused by the BUYER’s delay in making a decision or agreement as above shall constitute a permissible
delay under this CONTRACT. Such agreement on the matters set out above shall be effected in the same manner as provided above for modification and change of the SPECIFICATIONS and the PLAN. 
  
 ARTICLE VI: TRIALS AND COMPLETION 
  
 1. NOTICE 
  
 The BUILDER shall give the BUYER notice in writing or by cable, telex or
facsimile, at least fourteen (14) days in advance of the time and place of the trial run of the VESSEL. Such notice shall specify the place from which the VESSEL will commence her trial run and 
  

 13 

 approximate date upon which the trial run is expected to take place. Such date shall be further confirmed by the BUILDER
five (5) days in advance of the trial run by telex, cable or facsimile. 
  
 The BUYER’S REPRESENTATIVE shall be present at such place on the date specified in such notice. Should the BUYER’S REPRESENTATIVE fail to be present after the BUILDER’S due notice to the BUYER as provided above, the BUILDER
shall be entitled to conduct such trial run with the presence of the representative(s) of the CLASSIFICATION SOCIETY, only, without the BUYER’S REPRESENTATIVE being present. In such case, the BUYER shall be obliged to accept the VESSEL on the
basis of a certificate issued by the BUILDER, accompanied by results of the trials and countersigned by the CLASSIFICATION SOCIETY stating the VESSEL, after the trial run, subject to alterations and corrections, if necessary, has been found to
conform with the SPECIFICATIONS and this CONTRACT and is satisfactory in all respects, provided the BUILDER first makes such corrections and alterations promptly. 
  
 2. WEATHER CONDITIONS 
  
 In the event of unfavorable weather (exceeding Beaufort Scale 5) on the date specified for the trial run, the trial run shall take place on the first
available day that weather conditions permit. The parties hereto recognize that the weather conditions in Korean waters, in which the trial run is to take place, are such that great changes in weather may arise momentarily and without warning and
therefore, it is agreed that if, during the trial run, the weather should become so unfavorable that the trial run cannot be continued, then the trial run shall be discontinued and postponed until the first favorable day next following, unless the
BUYER shall assent to the acceptance of the VESSEL by notification in writing, on the basis of such trial run so far made, prior to such change in weather conditions. Any delay of the trial run caused by such unfavorable weather conditions shall
also operate to extend the Delivery Date of the VESSEL for the period of delay occasioned by such unfavorable weather conditions. 
  
 3. HOW CONDUCTED 
  
 All expenses in connection with the trials of the VESSEL, are to be for the account of the BUILDER, which, during the trials, is to provide at its own
expense the necessary crew to comply with conditions of safe navigation. The trials shall be conducted in the manner prescribed in this CONTRACT and the SPECIFICATIONS, and shall prove fulfillment of the performance requirements for the trials as
set forth in the SPECIFICATIONS. 
  
 The BUILDER shall be entitled
to conduct preliminary sea trials, during which the propulsion plant and/or its appurtenance shall be adjusted according to the BUILDER’s judgement. The BUILDER shall have the right to repeat any trial whatsoever as it deems necessary.

  
 4. CONSUMABLE STORES 
  
 The BUILDER shall load the VESSEL with the required quantity of fuel oil,
lubricating oil and greases, fresh water, and other stores necessary to conduct the trials as set forth in the SPECIFICATIONS. The necessary ballast (fuel oil, fresh water and other ballast as may be required) to bring the VESSEL to the trial load
draft, as specified in the SPECIFICATIONS, 
  

 14 

 shall be supplied and paid for by the BUILDER whilst lubricating oil and greases shall be supplied and paid for by the
BUYER within the time advised by the BUILDER for the conduct of sea trials, as well as for use before the delivery of the VESSEL to the BUYER. The fuel oil as well as lubricating oil and greases shall be in accordance with the engine specifications
and the BUYER shall decide and advise the BUILDER of the supplier’s name for lubricating oil and greases before the work commencement of the VESSEL, provided that the supplier shall be acceptable to the BUILDER and/or the makers of all the
machinery. 
  
 Any fuel oil, fresh water or other consumable
stores furnished and paid for by the BUILDER for trials runs remaining on board the VESSEL, at the time of acceptance of the VESSEL by the BUYER, shall be bought by the BUYER from the BUILDER at the BUILDER’s purchase price for such supply in
Korea and payment by the BUYER thereof shall be made at the time of delivery of the VESSEL. The BUILDER shall pay the BUYER at the time of delivery of the vessel for the consumed quantity of any lubricating oil and greases which were furnished and
paid for, by the BUYER at the BUYER’s purchase price thereof. The consumed quantity of lubricating oils and greases shall be calculated on the basis of the difference between the remaining amount, including the same remaining in the main
engine, other machinery and their pipes, stern tube and the like, and the supplied amount. 
  

	 	5.	 	ACCEPTANCE OR REJECTION 

  
 Upon completion of sea trials, the BUILDER shall analyze the results of the sea trials, and if found to be in accordance with this CONTRACT and the
SPECIFICATIONS, give the BUYER notice in writing or by telefax (a) of successful completion of the sea trials run accompanied by copies of the results and records of all tests carried out and (b) of conformity of the VESSEL with the requirements of
this CONTRACT and the SPECIFICATIONS. 
  
 Within three (3) days
after receipt of such notice, the BUYER shall notify the BUILDER in writing or by telefax, of its acceptance or rejection of the VESSEL on the basis of its conformity with the requirements of this CONTRACT and the SPECIFICATIONS. 
  
 Should it develop, on or before the sea trials, that the VESSEL or any part
or equipment thereof does not conform to the requirements of this CONTRACT and/or the SPECIFICATIONS, the BUILDER shall promptly take necessary steps to correct such non-conformity. 
  
 Upon completing of correction of such non-conformity, the BUILDER shall promptly perform such further trials, or other test
of the VESSEL, or the part or equipment thereof concerned, as may be deemed necessary to prove the VESSEL’s compliance with the requirements of this CONTRACT and the SPECIFICATIONS, and if found to be satisfactory, give to the BUYER notice by
telefax of such correction, and, as appropriate, successful completion accompanied by copies of such results and tests, and the BUYER shall, within three (3) days after receipt of such notice, advise the BUILDER in writing by telefax, of its
acceptance or rejection of the VESSEL. 
  
 Any notice of rejection
of the VESSEL shall state the reasons why the VESSEL fails to conform with the requirements of this CONTRACT and the SPECIFICATIONS. If the 
  

 15 

 BUILDER agrees to the BUYER’S reasons why the VESSEL fails to conform with the requirements of this CONTRACT and the
SPECIFICATIONS, the process of performing necessary corrections by the BUILDER and advising of the acceptance or rejection of the VESSEL by the BUYER as aforesaid may be repeated, subject to the provision of the Article III.1(c) hereof. 

 
 If the BUILDER does not agree to the rejection by the BUYER of the VESSEL
or any part or equipment thereof, the BUILDER shall so advise the BUYER promptly, in which case either the BUYER or the BUILDER may submit any dispute as to the conformity thereof with the requirements of this CONTRACT and the SPECIFICATIONS to
arbitration under Article XIV hereof. 
  
 The BUYER shall not
unreasonably reject the VESSEL because of minor noaconformities or defects not affecting the class or seaworthiness of the VESSEL, and which do not adversely affect the trading of the VESSEL, provided that such non-conformities or defects will be
corrected by the BUILDER following delivery of the VESSEL. 
  

	 	6.	 	EFFECT OF ACCEPTANCE 

  
 The BUYER’S written, telexed, cabled or facsimiled notification of acceptance delivered to the BUILDER as above provided, shall be final and binding
in so far as conformity of the VESSEL with the SPECIFICATIONS is concerned, and shall preclude the BUYER from refusing formal delivery of the VESSEL as hereinafter provided, if the BUILDER complies with all conditions of delivery, as herein set
forth and provided that, in the case of qualified acceptance, any matters which were mentioned in the notice of the qualified acceptance by the BUYER as requiring correction have been corrected satisfactorily. 
  
 If the BUYER fails to notify the BUILDER in writing by telefax of its
acceptance or rejection of the VESSEL, together with the reason therefore within the period as provided hereinabove, the BUYER shall be deemed to have accepted the VESSEL. 
  
 ARTICLE VII: DELIVERY 
  

	 	1.	 	TIME AND PLACE 

  
 The VESSEL shall be delivered by the BUILDER to the BUYER at the SHIPYARD, safely afloat on/or before
[            ] (hereinafter called the “DELIVERY DATE”), after completion of satisfactory trials and acceptance by the BUYER in accordance with the terms of Article VI. Except
that, in the event of delays in delivery of the VESSEL by the BUILDER due to causes which under the terms of this CONTRACT permits extensions of the time for delivery of the VESSEL, the afore-mentioned DELIVERY DATE shall be extended accordingly.

  
 The BUILDER shall have the option to advance the DELIVERY DATE
of the VESSEL in accordance with the berth situation of the BUILDER within two (2) months after signing of this CONTRACT. 
  

 16 

	 	2.	 	WHEN AND HOW EFFECTED 

  
 Provided that the BUYER shall, concurrently with delivery of the VESSEL, release to the BUILDER the fifth installment as set forth in Article X.2 hereof
and shall have fulfilled all of its obligations provided for in this CONTRACT, delivery of the VESSEL shall be forthwith effected upon acceptance thereof by the BUYER, as hereinabove provided, by the concurrent delivery by each of the parties hereto
to the other of a PROTOCOL OF DELIVERY AND ACCEPTANCE, acknowledging delivery of the VESSEL by the BUILDER and acceptance thereof by the BUYER, which PROTOCOL shall be prepared in duplicate and signed by each of the patties hereto. 
  

	 	3.	 	DOCUMENTS TO BE DELIVERED TO THE BUYER 

  
 Upon delivery and acceptance of the VESSEL, the BUILDER shall deliver to the BUYER the following documents, which shall accompany the aforementioned
PROTOCOL OF DELIVERY AND ACCEPTANCE: 
  
 (a) PROTOCOL OF TRIALS
(including results of Main Engine Shop Trials) of the VESSEL made pursuant to this CONTRACT and the SPECIFICATIONS. 
  
 (b) PROTOCOL OF INVENTORY of the equipment of the VESSEL, including spare parts, all as specified in the SPECIFICATIONS. 
  
 (c) PROTOCOL OF STORES OF CONSUMABLE NATURE, such as all fuel oil and fresh
water remaining in tanks if its cost is charged to the BUYER under Article VI.4 hereof. 
  
 (d) DRAWINGS, PLANS and MANUALS pertaining to the VESSEL as stipulated in the SPECIFICATIONS, which shall be furnished to the BUYER at no additional cost. 
  
 (e) ALL CERTIFICATES required to be famished upon delivery of the VESSEL pursuant to this CONTRACT, the SPECIFICATIONS and
the customary shipbuilding practice, including but not limited to: 
  
 (i) Classification Certificate 
  
 (ii) Safety
Construction Certificate 
  
 (iii) Safety Equipment Certificate

  
 (iv) Safety Radio Certificate 
  
 (v) International Loadline Certificate 
  
 (vi) International Tonnage Certificate 
  
 (vii) BUILDER’s Certificate, duly notarially attested 
  

 17 

 (viii) De-ratting Exemption Certificate 
  
 However, it is agreed by the parties that if the Classification Certificate and/or other certificates are not available at
the time of delivery of the VESSEL, provisional certificates shall, if this can be done without affecting the VESSEL’s trading, be accepted by the BUYER, provided that the BUILDER shall furnish the BUYER with formal certificates as promptly as
possible, after such formal certificates have been issued. 
  
 (f)
BILL OF SALE transferring title to the VESSEL free of all liens, claims, mortgages and other encumbrances whatsoever. 
  
 (g) DECLARATION OF WARRANTY of the BUILDER that the VESSEL is delivered to the BUYER free and clear of any liens, claims, mortgages or other encumbrances
upon the BUYER’s title thereto, and in particular, that the VESSEL is absolutely free of all burdens in the nature of imposts, taxes or charges imposed by the prefecture or country of the port of delivery, as well as of all liabilities of the
BUILDER to its sub-contractors and employees and of all liabilities arising from the operation of the VESSEL in trial runs, or otherwise, prior to delivery except as otherwise provided under this CONTRACT. 
  
 (h) Commercial Invoice. 
  

	 	4.	 	TENDER OF THE VESSEL 

  
 If the BUYER for reasons not attributable to the BUILDER, fails to take delivery of the VESSEL after completion thereof according to this CONTRACT and the
SPECIFICATIONS, the BUILDER shall have the right to tender delivery of the VESSEL, by notice in writing to the BUYER after compliance with all procedural requirements as provided above. 
  

	 	5.	 	TITLE AND RISK 

  
 Title and risk shall pass to the BUYER upon delivery of the VESSEL being effected as stated above and the BUILDER shall be free of all responsibility or
liability whatsoever related to this CONTRACT except for the warranty of quality contained in Article IX and the obligation to correct and/or remedy as provided in Article V1.5 if any. It being expressly understood that, until such delivery is
effected, the VESSEL and equipment thereof are at the entire risk of the BUILDER including but not confined to, risks of war, insurrection and seizure by Governments or Authorities, whether Korean or foreign, and whether at war or at peace. The
title to the BUYER’s supplies as provided in Article XIII shall remain with the BUYER and the BUILDER’s responsibility for such BUYERS’s supplies shall be as described in Article XIII.2. 
  

	 	6.	 	REMOVAL OF THE VESSEL 

  
 The BUYER shall take possession of the VESSEL immediately upon delivery thereof and unless work is still being carried out by the BUILDER on the VESSEL
(i.e. non-conformities) shall remove the VESSEL from the SHIPYARD within three (3) days after delivery thereof is effected. Port dues and other similar charges after delivery of the VESSEL and any other costs related to the removal of the VESSEL
shall be borne by the BUYER, save 
  

 18 

 insofar as they relate to the time the VESSEL remains at the shipyard after delivery, for the purpose of correcting
defects or non conformities as provided by Article VI.5. 
  
 ARTICLE VIII: DELAYS AND EXTENSIONS OF TIME (FORCE MAJEURE) 
  
  

	 	1.	 	CAUSES OF DELAY 

  
 If at any time after signing this CONTRACT, either the construction or delivery of the VESSEL or any performance required hereunder as a prerequisite to
the delivery thereof is delayed by any of the following events, namely war, acts of state or government, blockade, revolution, insurrections, mobilization, civil commotion, riots, strikes, sabotage, lockouts, Acts of God or the public enemy, plague
or other epidemics, quarantines, shortage or prolonged failure of electric current, freight embargoes, or defects in major forging or castings, or delays or defects in the BUYER’S supplies as stipulated in Article XIII, if any, or shortage of
materials, machinery or equipment or inability to obtain delivery or delays in delivery of materials, machinery or equipment, provided that at the time of ordering the same could reasonably be expected by the BUILDER to be delivered in time or
defects in materials, machinery or equipment which could not have been detected by the BUILDER using reasonable care or earthquakes, tidal waves, typhoons, hurricanes, prolonged or unusually severe weather conditions or destruction of the premises
or works of the BUILDER or its sub-contractors, or of the VESSEL, or any part thereof, by fire, landslides, flood, lightning, explosion, or delays in the BUILDER’S other commitments resulting from any such causes as described in this Article
which in turn delay the construction of the VESSEL or the BUILDER’s performance under the CONTRACT, or delays caused by the CLASSIFICATION SOCIETY or the BUYER’s faulty action or omission, or other causes beyond the control of the BUILDER,
or its sub-contractors as the case may be, or for any other causes which, under the terms of this CONTRACT, authorize and permit extension of the time for delivery of the VESSEL, then in the event of delays due to the happening of any of the
aforementioned contingencies, then and in any such case, PROVIDED THAT: 
  
 (a) such delay or event has not been caused by any negligence of the BUILDER or its subcontractors and 
  
 (b) the BUILDER shall use all reasonable efforts to prevent or minimize any delay in the construction of the VESSEL resulting from such events (including
but without limitation the obtaining of items from alternative sources and the introduction of overtime), the DELIVERY DATE of the VESSEL under this CONTRACT shall be extended for a period of time equal to the delay in the DELIVERY DATE so caused
but which shall not exceed the total accumulated time of all such delays as specified in paragraph (3) hereof. 
  

	 	2.	 	NOTICE OF DELAYS 

  
 As soon as practicably possible but not later than ten (10) days after commencement of any delay on account of which the BUILDER claims that it is
entitled under this CONTRACT to an extension of the DELIVERY DATE of the VESSEL, excluding delays due to arbitration, the BUILDER shall advise the BUYER in writing or by telex, cable or facsimile of the date such delay commenced, the reasons thereof
and, if possible, its estimated duration of the probable 
  

 19 

 delay in the delivery of the VESSEL, and shall supply the BUYER if reasonably available with evidence to justify the
delay claimed. Within five (5) days after such delay ends, the BUILDER shall likewise advise the BUYER in writing or by telex, cable or facsimile of the date that such delay ended, and also, shall specify the period of time by which the BUILDER
claims the DELIVERY DATE should be extended by reason of such delay. Failure of the BUYER to object to the BUILDER’s notification of any claim for extension of the date for delivery of the VESSEL within five (5) days after receipt by the BUYER
of such notification shall be deemed to be a waiver by the BUYER of its right to object to such extension. 
  

	 	3.	 	RIGHT TO CANCEL FOR EXCESSIVE DELAY 

  
 If the total accumulated time of all permissible and non permissible delays, excluding delays due to (i) arbitration under Article XIV (ii) the BUYER
defaults under Article XI, (iii) modifications and changes under Article V or (iv) delays or defects in the BUYER’s supplies as stipulated in Article XIII aggregates two hundred and forty (240) days or more, then the BUYER may, at any time
thereafter, cancel this CONTRACT by giving a written notice of cancellation to the BUILDER. Such cancellation shall be effective as of the date the notice thereof is received by the BUILDER. 
  
 If the BUYER has not served the notice of cancellation as provided in the
above or Article III.1 hereof, the BUILDER may at any time after expiration of the accumulated time of the delay in delivery, either two hundred and forty (240) days in case of the delay in this Paragraph or one hundred and eighty (180) days in case
of the delay in Article III.1 notify the BUYER of the future date upon which the BUILDER estimates the VESSEL will be ready for delivery and demand in writing or by telex, cable or facsimile that the BUYER make an election either to cancel this
CONTRACT or to consent to the delivery of the VESSEL at such future date, in which case the BUYER shall, within ten days after receipt of such demand, make and notify the BUILDER of such election. If the buyer elects to consent to the delivery of
the VESSEL at such future date (or other future date as the parties may agree): 
  
 (a) Such future date shall become the contractual delivery date for the purposes of this CONTRACT (subject always to adjustment of the CONTRACT PRICE under Article III.1) and shall be subject to extension by reason of
permissible delays as herein provided and 
  
 (b) If the VESSEL is
not delivered by such revised contractual delivery date (as extended by reason of permissible delays) the BUYER shall have the same right of cancellation upon the same terms, as provided in the above and Article III.1. 
  
 If the BUYER shall not make an election within ten (10) days as provided
hereabove, the BUYER shall be deemed to have accepted such extension of the DELIVERY DATE to the future delivery date indicated by the BUILDER. 
  

	 	4.	 	DEFINITION OF PERMISSIBLE DELAYS 

  
 Delays on account of the foregoing causes shall be understood to be permissible delays and are to be distinguished from non permissible unauthorized
delays, on account of which the CONTRACT PRICE of the VESSEL, is subject to adjustment as provided in Article III hereof. 
  

 20 

 ARTICLE IX: WARRANTY OF QUALITY 
  

	 	1.	 	GUARANTEE OF MATERIAL AND WORKMANSHIP 

  
 The BUILDER, for the period of twelve (12) months from the date of delivery of the VESSEL to the BUYER, guarantees the VESSEL and all its parts, machinery
and equipment thereof against all defects which are directly due to defective designs, materials, construction miscalculation and/or poor workmanship, provided such defects have not been caused by perils of the sea, rivers or navigations, or by
normal wear and tear, overloading, improper loading or stowage, normal corrosion of the unprotected materials, fire, accident, incompetence, mismanagement, negligence or willful neglect or by alteration or addition by the BUYER not previously
approved by the BUILDER. 
  
 To the extent that any warranty or
guarantee provided by any sub-contractor or supplier is of wider scope or remains in effect after the expiry of the twelve (12) month period laid down in this paragraph, such warranty or guarantee shall, on such expiry, be assigned to the BUYER.

  

	 	2.	 	NOTICE OF DEFECTS 

  
 The BUYER or its duly authorized representative will notify the BUILDER in writing or by telex, cable or facsimile promptly, but not later than twenty-one
(21) days, after discovery of any defect for which a claim is to be made under this guarantee. 
  
 The BUYER’s written notice shall describe the nature of the defect and the extent of the damage caused thereby. The BUILDER will be under no obligation with respect to this guarantee in respect of any claim for
its defects discovered prior to the expiry date of the guarantee, unless notice of such defects is received by the BUILDER before the expiry date. However, cable or telex or facsimile advice received by the BUILDER within five (5) days after such
expiry date that a claim is forthcoming will be sufficient compliance with the requirement as to time, provided that such cable or telex or facsimile advice shall include at least a brief description of the defect including the identity of the
equipment and extent of damage, and that full particulars are given to the BUILDER not later than fifteen (15) days after the expiry date. 
  

	 	3.	 	REMEDY OF DEFECTS 

  
 (a) The BUILDER shall remedy, at its expense, any defects, against which VESSEL is guaranteed under this Article, by making all necessary and reasonably
practicable repairs or replacements at the SHIPYARD or elsewhere as provided for in (b) hereinbelow. 
  
 In such case, the VESSEL shall be taken at the BUYER’s cost and responsibility to the place selected, ready in all respects for such repairs or
replacements and in any event, the BUILDER shall not be responsible for towage, dockage, wharfage, port charges and anything else incurred for the BUYER’s getting and keeping the VESSEL ready for such repairing or replacing. 
  
 (b) However, if it is impractical (which shall include, but not be limited
to, an emergency) to bring the VESSEL to the SHIPYARD, the BUYER may cause the necessary repairs or replacements to be made elsewhere which is deemed by the BUYER with the consent 
  

 21 

 of the BUILDER which shall not be unreasonably withheld, to be suitable for the purpose, provided that, in such event,
the BUILDER may forward or supply replacement parts or materials under the terms described in (c) hereinbelow, unless forwarding or supplying thereof under the terms described in (c) hereinbelow would impair or delay the operation or working
schedule of the VESSEL. In the event that the BUYER proposes to cause the necessary repairs or replacements to be made to the VESSEL at any shipyard or works other than the SHIPYARD, the BUYER shall first (but in all events as soon as reasonably
possible) give the BUILDER notice in writing or by telex, cable or facsimile of the time and place such repairs will be made, and if the VESSEL is not thereby delayed, or her operation or working schedule is not thereby impaired, the BUILDER shall
have the right to verify by its own representative(s) the nature and the extent of the defects complained of. The BUILDER shall, in such case, promptly advise the BUYER by telex, cable or facsimile, after such examination has been completed, of its
acceptance or rejection of the defects as ones that are covered by the guarantee herein provided. Upon the BUILDER’s acceptance of the defects as justifying remedy under this Article, or upon award of the arbitration so determining, the BUILDER
shall compensate the BUYER an amount equal to the cost of making the same repairs or replacements at a major repair shipyard in Singapore. 
  
 (c) In the event that it is necessary for the BUILDER to forward a replacement, for a defective part under this guarantee, replacement parts shall be
shipped to the BUYER under terms of F.O.B. port of the country where they are to be purchased. 
  
 (d) The BUILDER reserves the option to retrieve, at the BUILDER’s cost, any of the replaced equipment/parts in case defects are remedied in accordance with the provisions in this Article. 
  
 (e) Any dispute under this Article shall be referred to arbitration in
accordance with the provisions of Article XIV hereof. 
  
 4.
EXTENT OF THE BUILDER’S LIABILITY 
  
 (a) After
delivery of the VESSEL, the responsibility of the BUILDER in respect of and/or in connection with the VESSEL and/or this CONTRACT shall be limited to the extent expressly provided in this Article. Except as expressly provided, in no circumstances
and on no ground whatsoever shall the BUILDER have any responsibility or liability whatsoever or howsoever arising in respect of or in connection with the VESSEL or this CONTRACT after the delivery of the VESSEL. Further, but without in any way
limiting the generality of the foregoing, the BUILDER shall have no liability or responsibility whatsoever or howsoever arising for or in connection with any pecuniary loss or expense, any liability to any third party or any fine, compensation,
penalty or other payment or sanction incurred by or imposed upon the BUYER or any other party whatsoever in relation to or in connection with this CONTRACT or the VESSEL. 
  
 (b) The BUILDER shall be under no obligation with respect to defects discovered after the expiration of the period of
guarantee specified above. 
  

 22 

 (c) The BUILDER shall under no circumstances be liable for defects in the VESSEL or any other part of
equipment thereof caused by perils of the sea, rivers or navigation, or normal wear and tear, or fire or accidents at sea or elsewhere or by mismanagement, accident, negligence, willful neglect, alteration or addition on the part of the BUYER, its
employees or agents, (including the VESSEL’s officers, crew and passengers) not previously approved by the BUILDER. Likewise, the BUILDER shall not be liable for defects in the VESSEL or any part of equipment thereof that are due to repairs
which were made by other than the BUILDER or in accordance with this Article. 
  
 (d) The liability of the BUILDER provided for in this Article shall be limited to defects directly caused by defective design, materials, construction miscalculation and/or poor workmanship as above provided. The
BUILDER shall not be obliged to repair, nor be liable for, damage to the VESSEL or any part of the equipment thereof, caused other than by the defects of the nature specified above. The guarantees contained as hereinabove in this Article replace and
exclude any other liability, guarantee, warranty and/or condition imposed or implied by statute, common law, custom or otherwise on the part of the BUILDER by reason of the construction and sale of the VESSEL for and to the BUYER. 
  
 ARTICLE X: PAYMENT 
  
 1. CURRENCY 
  
 All payments under this CONTRACT shall be made in United States Dollars.

  
 2. TERMS OF PAYMENT 
  
 The payments of the CONTRACT PRICE shall be made as follows: 
  
 (a) First Installment 
  
 Five percent (5%) of the CONTRACT PRICE amounting to
[                 ] shall be paid within three (3) business days after delivery to the BUYER of the Refund Guarantee as per Exhibit “A” issued by the Export
Import Bank of Korea (hereinafter called the “KOEXIM”). 
  
 Under this CONTRACT, in counting the business days, only Saturdays and Sundays are excepted. When a due date falls an a day when banks are not open for business in Athens, Greece, London, United Kingdom, New York N.Y., U.S.A., such due date
shall fall due upon the first business day next following. 
  
 (b)
Second Installment 
  
 Five per cent (5%) of the CONTRACT
PRICE amounting to [                 ] shall be paid six (6) months after signing of this CONTRACT. 
  
 (c) Third Installment 
  

 23 

 Ten per cent (10%) of the CONTRACT PRICE amounting to
[                 ] shall be paid within three (3) business days of receipt by the BUYER of a telexed, cabled or facsimiled advice from the BUILDER confirmed by the
CLASSIFICATION SOCIETY that the first block of the keel has been laid. 
  
 (d) Fourth Installment 
  
 Ten per cent (10%) of
the CONTRACT PRICE amounting to [                 ] shall be paid within three (3) business days of receipt by the BUYER of a telexed, cabled or facsimiled advice from
the BUILDER confirmed by the CLASSIFICATION SOCIETY that the VESSEL has been launched. 
  
 (e) Fifth Installment 
  
 Seventy per cent (70%) of the CONTRACT PRICE amounting to [                 ] plus or minus any increase or decrease due to modifications and/or adjustment, if
any, arising prior to delivery of the VESSEL of the CONTRACT PRICE under Articles III and V of this CONTRACT shall be paid to the BUILDER upon delivery of the VESSEL. (The date stipulated for payment of each of the five installments mentioned above
is hereinafter in this Article and in Article XI referred to as the “DUE DATE” of that installment). 
  
 It is understood and agreed upon by the BUILDER and the BUYER that all payments under the provisions of this Article shall not be delayed or withheld by
the BUYER due to any dispute or disagreement of whatsoever nature arising between the BUILDER and the BUYER. Should there be any dispute in this connection, the matter shall be dealt with in accordance with the provisions of arbitration in Article
XIV hereof. 
  
 3. DEMAND FOR PAYMENT 
  
 At least fourteen (14) days prior to the date of each event provided in
Paragraph 2 of this Article on which any payments shall fall due hereunder, with the exception of the payment of the first and second installments, the BUILDER shall notify the BUYER by telex, cable or facsimile of the date such payment shall become
due. 
  
 The BUYER shall promptly acknowledge receipt of such
notification by telex, cable or facsimile to the BUILDER, and make payment as set forth in this Article. If the BUILDER fails to receive the BUYER’s said acknowledgement within three (3) days after sending the aforementioned notification, the
BUILDER shall promptly telex, cable or facsimile to the BUYER a second notification of similar impart. The BUYER shall immediately acknowledge by telex, cable or facsimile receipt of the foregoing second notification regardless of whether or not the
first notification was acknowledged as aforesaid. 
  
 If the
BUYER’s deposit covering the fifth installment is withdrawn as provided in Article X.4(a)(ii), because delivery of the VESSEL has not taken place within seven (7) days following the scheduled delivery date, the BUILDER shall be obliged to give
the BUYER not less than six (6) business days notice of the revised scheduled delivery date. 
  

 24 

 4. METHOD OF PAYMENT 
  
 (a) All the pre-delivery payments and the payment due on delivery in settlement of the CONTRACT PRICE as provided for in
Paragraph 2 of this Article shall be made in U.S.Dollars on or before the DUE DATE thereof by telegraphic transfer as follows: 
  
 (i) The payment of the first, second, third and fourth installments shall be made to the account (Account No.: 04-029-695) of KOEXIM with Bankers Trust
Company, Church Street Station, New York, N.Y. 10015, U.S.A. (hereinafter called the “BTC”) in favour of the BUILDER. 
  
 (ii) The BUYER shall, not later than three (3) business days prior to the scheduled delivery date of the VESSEL notified by the BUILDER, make a cash
deposit with KOEXIM, of an amount covering the fifth installment, as adjusted, in the name of the BUYER, with irrevocable instructions that the amount so deposited (less interest accrued thereon, if any) shall be payable to the BUILDER against
presentation by the BUILDER of a duplicate original copy of the PROTOCOL OF DELIVERY AND ACCEPTANCE of the VESSEL signed by the BUILDER and the BUYER or if the VESSEL has not been delivered to the BUYER, for reasons attributable to the BUILDER
within seven (7) days following the scheduled delivery date of the VESSEL, the BUYER may withdraw such sum and the BUILDER shall be compelled to nominate a revised scheduled Delivery Date. Interest accrued on such, if any, shall belong to the BUYER.

  
 (b) Simultaneously with each of such payments or deposit, the
BUYER shall advise the BUILDER of the details of the payments by telex, cable or facsimile and at the same time, the BUYER shall cause the BUYER’s remitting Bank to advise the KOEXIM of the details of such payments or deposit together with such
irrevocable payment instructions by authenticated bank communication. 
  
 5. REFUND BY THE BUILDER 
  
 The payments made by
the BUYER to the BUILDER prior to delivery of the VESSEL shall constitute advances to the BUILDER. If the VESSEL is rejected by the BUYER in accordance with the terms of this CONTRACT, or if the BUYER terminates, cancels or rescinds this CONTRACT
pursuant to any of the provisions of this CONTRACT specifically permitting the BUYER to do so, the BUILDER shall forthwith refund to the BUYER, in U.S.Dollars, the full amount of total sums paid by the BUYER to the BUILDER in advance of delivery
together with interest thereon as herein provided. 
  
 The
transfer and other bank charges of such refund shall be for the BUILDER’s account. The interest rate of the refund, as above provided, shall be ten per cent (10%) per annum from the date following the date of receipt by the BUILDER of the
pre-delivery installment(s) to the date of remittance by telegraphic transfer of such refund, provided, however, that if the cancellation of this CONTRACT by the BUYER is based upon delays due to force majeure or other causes beyond the control of
the BUILDER as provided for in Article VIII hereof, then in such event the interest rate of refund shall be reduced to eight per cent (8%) per annum. 
  

 25 

 It is hereby understood by both parties that payment of any interest provided herein is by way of
liquidated damages due to cancellation of this CONTRACT and not by way of compensation for use money. 
  
 If, the BUILDER is required to refund to the BUYER the installments paid by the BUYER to the BUILDER as provided in this Paragraph, the BUILDER shall
return to the BUYER all of the BUYER’s supplies as stipulated in Article XIII which were not incorporated into the VESSEL and pay to the BUYER an amount equal to the cost to the BUYER of those BUYER’s supplies incorporated into the VESSEL.

  
 6. TOTAL LOSS 
  
 If there is a total loss or a constructive total loss of the VESSEL prior to
delivery thereof, the BUILDER shall proceed according to the mutual agreement of the parties hereto either: 
  
 (a) to build another vessel in place of the VESSEL so lost and deliver it under this CONTRACT to the BUYER, provided that the parties hereto shall have
agreed in writing to a reasonable cost and time for the construction of such vessel in place of the lost VESSEL or 
  
 (b) to refund to the BUYER the full amount of the total sutras paid by the BUYER to the BUILDER under the provisions of Paragraph 2 of this Article and
the value of BUYER’s supplies delivered to the SHIPYARD, if any, together with interest thereon at the rate of ten per cent (10%) per annum from the date following the date of receipt by the BUILDER of such pre-delivery installment(s) to the
date of payment by the BUILDER to the BUYER of the refund. 
  
 If
the parties hereto fail to reach such agreement within two (2) months after the VESSEL is determined to be a total loss or constructive total loss, the provisions of (b) hereinabove shall be applied. 
  
 7. DISCHARGE OF OBLIGATIONS 
  
 Such refund as provided in the foregoing Paragraphs 5 and 6 by the BUILDER to
the BUYER shall forthwith discharge all the obligations, duties and liabilities of each of the parties hereto to the other (other than any obligations of the BUYER in respect of facilities afforded to the BUYER’S REPRESENTATIVE, under his
CONTRACT). Any and all refunds or payments due to the BUYER under this CONTRACT shall be effected by telegraphic transfer to the account specified by the BUYER. 
  

8. REFUND GUARANTEE 
  
 The BUILDER shall as a condition precedent to payment by the BUYER of the first installment deliver to the BUYER an assignable letter of guarantee issued
by the KOEXIM for the refund of the pre-delivery installments plus interest as aforesaid to the BUYER under or pursuant to Paragraph 5 above in the form annexed hereto as Exhibit “A”. All expenses in issuing and maintaining the letter of
guarantee described in this Paragraph shall be borne by the BUILDER. 
  

 26 

 9. PERFORMANCE GUARANTEE 
  
 Upon signing this CONTRACT, the BUYER shall provide the BUILDER with an irrevocable and unconditional Corporate Guarantee
issued by [                 ], for the due and faithful performance by the BUYER of all its liabilities and responsibilities under the CONTRACT including, but not
limited to, payment of the CONTRACT PRICE and taking delivery of the VESSEL, in the form annexed hereto as Exhibit “B”. 
  
 ARTICLE XI: BUYER’S DEFAULT 
  
 1. DEFINITION OF DEFAULT 
  
 The BUYER shall be deemed to be in default under this CONTRACT in the following cases: 
  
 (a) If the first, second, third or fourth installment is not paid to the BUILDER within respective DUE DATE of such
installments and the BUYER has not effected payment thereof together with interest thereon at the rate provided at Article XI.2(b) below from the DUE DATE to the date of payment within three (3) business days of being notified by the BUILDER of such
non payment; or 
  
 (b) If the BUYER fails to make a cash deposit
with the BUILDER’s bank as provided in Article X.4(a)(ii) hereof or if the fifth installment is not released to the BUILDER against presentation by the BUILDER of a duplicate original of the PROTOCOL OF DELIVERY AND ACCEPTANCE; or 

 
 (c) If the BUYER fails to take delivery of the VESSEL when the VESSEL is
duly tendered for delivery by the BUILDER under the provisions of Article VII hereof; or 
  
 (d) If the BUYER shall apply for or consent to the appointment of a receiver, trustee or liquidator, shall be adjudicated, insolvent, shall apply to the courts for protection from its creditors, file a voluntary
petition in bankruptcy or take advantage of any insolvency law, or any action shall be taken by the BUYER having an effect similar to any of the foregoing or the equivalent thereof in any jurisdiction or the BUYER shall be unable to pay its debts as
they fall due. 
  
 In case the BUYER is in default of any of its
obligations under this CONTRACT the BUILDER is entitled to and shall have the following rights, powers and remedies in addition to such other rights, powers and remedies as the BUILDER may have in this CONTRACT or elsewhere. 
  
 2. EFFECT OF THE BUYER’S DEFAULT ON OR BEFORE THE DELIVERY OF THE
VESSEL 
  
 If the BUYER shall be in default as provided in
Paragraph 1 above of its obligations under this CONTRACT, then: 
  

 27 

 (a) The DELIVERY DATE of the VESSEL shall be extended automatically for the actual period of such default
and the BUILDER shall not be obliged to pay any liquidated damages for the delay in delivery of the VESSEL caused thereby. 
  
 (b) The BUYER shall pay to the BUILDER interest at the rate of ten per cent (10%) per annum in respect of the installment(s) in default from the
respective DUE DATE to the date of actual receipt by the BUILDER of the full amount of such installment(s). 
  
 (c) If the BUYER is in default in payment of any of the installment(s) due and payable prior to or simultaneously with the delivery of the VESSEL, the
BUILDER shall, in writing or by telex, cable or facsimile, notify the BUYER to that effect, and the BUYER shall, upon receipt of such notification, forthwith acknowledge in writing or by telex, cable or facsimile to the BUILDER that such
notification has been received. 
  
 (d) If any of the BUYER’s
default continues for a period of ten (10) days after the BUILDER’s notification to the BUYER of such default, the BUILDER may, as its option, rescind this CONTRACT by serving upon the BUYER a written notice or a telex, cable or facsimile
notice of rescission confirmed in writing. 
  
 (e) In the event of
such cancellation by the BUILDER of this CONTRACT due to the BUYER’s default as provided for in paragraph 1 above, the BUILDER shall be entitled to retain and apply the installments already paid by the BUYER to the recovery of the
BUILDER’s loss and damage including, but not being limited to, reasonable estimated profit due to the BUYER’s default and the cancellation of the CONTRACT and at the same time the BUILDER shall have the full right and power either to
complete or not to complete the VESSEL which is the sole property of the BUILDER as it deems fit, and to sell the VESSEL at a public or private sale on such terms and conditions as the BUILDER thinks fit. In such event the BUILDER shall use its
reasonable efforts to obtain the best terms possible. 
  
 The
proceeds received by the BUILDER from the sale shall be applied in addition to the installment(s) retained by the BUILDER as mentioned hereinabove as follows: 
  

First, in payment of all reasonable costs and expenses of the sale of the VESSEL, including interest thereon at ten per cent (10%) per annum from the
respective date of payment of such costs and expenses aforesaid to the date of sale on account of the BUYER’s default. 
  
 Second, if the VESSEL has been completed, in or towards satisfaction of the unpaid balance of the CONTRACT PRICE, to which shall be added the cost of all
additional work and extras agreed by the BUYER including interest thereon at ten per cent (10%) per annum from the respective DUE DATE of the installment in default to the date of sale, or if the VESSEL has not been completed, in or towards
satisfaction of the unpaid amount of the cost incurred by the BUILDER prior to the date of sale on account of construction of the VESSEL, including work, labour, materials and reasonably estimated profit which the BUILDER would have been entitled to
receive if the VESSEL had been completed and 
  

 28 

 delivered, plus interest thereon at ten per cent (10%) per annum from the respective DUE DATE of the
installment in default to the date of sale. 
  
 Third, the
balance of the proceeds, if any, shall belong to the BUYER, and shall forthwith be paid over to the BUYER by the BUILDER. 
  
 In the event of the proceeds from the sale together with installment(s) retained by the BUILDER being insufficient to pay the BUILDER, the BUYER shall be
liable for the deficiency and shall pay the same to the BUILDER upon its demand. 
  
 ARTICLE XII: BUILDER’S DEFAULT 
  
 1. The BUILDER shall be deemed to be in default under this CONTRACT if the BUILDER, without reasonable excuse, intentionally delays in the commencement or progress of the construction of the VESSEL for a period of
ninety (90) days or more and the BUILDER has not rectified the same within fourteen (14) days of being notified by the BUYER of such delay. 
  
 In such event, the BUYER may by notice in writing to the BUILDER terminate this CONTRACT and the BUILDER shall promptly refund to the BUYER the full
amount of all sums paid by the BUYER to the BUILDER on account of the VESSEL and interest thereon at ten percent (10%) per annum on the amount to be refunded to the BUYER, computed from the respective date such sums were paid by the BUYER to the
date of remittance of the refundable amount to the BUYER. 
  
 2.
If the BUILDER duly contests such termination by the BUYER pursuant to Article XIV hereof, then, after the arbitration is decided in favour of the BUYER, the BUILDER shall promptly refund to the BUYER the full amount of all sums paid by the BUYER to
the BUILDER on account of the VESSEL. 
  
 In such event, the
BUILDER shall pay the BUYER interest at the rate of ten per cent (10%) per annum on the amount to be refunded to the BUYER computed from the respective date such sums were paid by the BUYER to the date of remittance of the refundable amount to the
BUYER. 
  
 3. If the BUILDER shall apply for or consent to the
appointment of a receiver, trustee or liquidator, shall be adjudicated insolvent, shall apply to the Courts for protection from its creditors, file, a voluntary petition in bankruptcy or take advantage of any insolvency law, or any action shall be
taken by the BUILDER having an effect similar to any of the foregoing or the equivalent thereof in any jurisdiction, the BUYER may by notice in writing to the BUILDER terminate this CONTRACT and require the BUILDER to refund, immediately, to the
BUYER the full amount of all sums paid by the BUYER to the BUILDER on account of the VESSEL and interest thereon at ten percent (10%) per annum on the amount to be refunded to the BUYER computed from the respective date such sums were paid by the
BUYER to the date of remittance of the refundable amount to the BUYER and immediately upon receipt of such notice the BUILDER shall refund such amount to the BUYER. 
  
 ARTICLE XIII: BUYER’S SUPPLIES 
  

 29 

 1. RESPONSIBILITY OF THE BUYER 
  
 The BUYER shall, at its cost and expense, supply the BUYER’s supplies (hereinafter called the “BUYER’S
SUPPLIES”), if any, to the BUILDER at the SHIPYARD in good condition ready for installation and in accordance with the time schedule to be furnished by the BUILDER to meet the building schedule of the VESSEL. 
  
 In order to facilitate the installation of the BUYER’S SUPPLIES by the
BUILDER, the BUYER shall furnish the BUILDER with the necessary plans, instruction books, test report and all test certificates required by the BUILDER and shall cause the representative(s) of the makers of the BUYER’S SUPPLIES to give the
BUILDER any advice, instructions or assistance which the BUILDER may reasonably require in the installation or adjustment thereof at the SHIPYARD, all without cost or expense to the BUILDER. 
  
 The BUYER shall be liable for any expense incurred by the BUILDER for repair
of the BUYER’S SUPPLIES due to defective design or materials, poor workmanship or performance or due to damage in transit and the DELIVERY DATE of the VESSEL shall be extended for the period of such repair if such repair shall affect the
delivery of the VESSEL. 
  
 Commissioning into good order of the
BUYER’S SUPPLIES during and after installation on board shall be made at the BUYER’s expense by the representative of the respective maker or the person designated by the BUYER in accordance with the BUILDER’s building schedule.

  
 Should the BUYER fail to deliver to the BUILDER the
BUYER’S SUPPLIES and the necessary document or advice for such supplies within the time specified by the BUILDER, the DELIVERY DATE of the VESSEL shall automatically be extended for the period of such delay if such delay in delivery shall
affect the delivery of the VESSEL. In such event, the BUYER shall pay to the BUILDER all losses and damages sustained by the BUILDER due to such delay in the delivery of the BUYER’S SUPPLIES and such payment shall be made upon delivery of the
VESSEL, provided however, that the BUILDER shall have: 
  
 (a)
furnished the BUYER with the time schedule referred to above, two (2) months prior to installation of the BUYER’S SUPPLIES and 
  
 (b) given the BUYER written notice of any delay in delivery of the BUYER’S SUPPLIES and the necessary documents or advice for such supplies as soon
as the delay occurs which might give rise to a claim by the BUILDER under the Paragraph. 
  
 Furthermore, if the delay in delivery of the BUYER’S SUPPLIES and the necessary documents or advice for such supplies should exceed ten (10) days from the date specified by the BUILDER, the BUILDER shall be
entitled to proceed with construction of the VESSEL without installation of such items (regardless of their nature or importance to the BUYER or the VESSEL) in or on the VESSEL without prejudice to the BUILDER’s right hereinabove provided, and
the BUYER shall accept the VESSEL so completed. 
  

 30 

 2. RESPONSIBILITY OF THE BUILDER 
  
 The BUILDER shall be responsible for storing, safekeeping and handling the BUYER’S SUPPLIES which the BUILDER is
required to install on board the VESSEL under the SPECIFICATIONS after delivery of such supplies to the SHIPYARD, and shall install such supplies on board the VESSEL at the BUILDER’s expense. 
  
 However, the BUILDER shall not be responsible for the quality, performance or
efficiency of any equipment included in the BUYER’S SUPPLIES and is under no obligation with respect to the guarantee of such equipment against any defects caused by poor quality, performance or efficiency of the BUYER’S SUPPLIES. If any
of the BUYER’S SUPPLIES is lost or damaged while in the custody of the BUILDER, the BUILDER shall, if the loss or damage is due to willful default or negligence on its part, be responsible for such loss or damage. 
  
 ARTICLE XIV: ARBITRATION 
  
 1. RULES, REGULATIONS AND REQUIREMENTS OF CLASSIFICATION SOCIETY

  
 In the event that any dispute shall arise during the
construction of the VESSEL as to the conformity of any construction or material with CLASSIFICATION SOCIETY requirements, such dispute shall be submitted to the head office of the CLASSIFICATION SOCIETY whose decision as to whether or not such
construction or material meets CLASIFICATION SOCIETY requirements shall be final. 
  
 2. TECHNICAL MATTERS 
  
 Any dispute or disagreement between the parties relating to any technical matter not governed by or relating to the rules and regulations of the CLASSIFICATION SOCIETY may be referred to an expert. The appointment of the expert to be
mutually agreed between the parties however if they fail to do so within 7 days from the day that the relevant technical matter has been notified to the other party then the matter to be referred to the Head Office of the CLASSIFICATION SOCIETY, and
they shall appoint the expert. Such expert shall give his opinion as an expert and not as an arbitrator and his opinion shall not be binding on the parties who shall be at liberty to refer the matter to the arbitration if they do not agree with such
opinion. 
  
 3. DISPUTE UNDER ARBITRATION 
  
 Except as provided in Paragraphs 1 and 2 above, all disputes, controversies
or differences which may arise between the Parties, out of or in relation to or in connection with this CONTRACT or interpretation thereof, or the breach thereof which the BUYER and the BUILDER have not been able to settle by mutual agreement shall
be finally settled by arbitration in London, in accordance with English law. The Arbitration Tribunal shall be composed of three arbitrators, two of whom shall be appointed by the Parties (one by each party) and the third of whom shall be agreed and
chosen by the two arbitrators chosen by the Parties pursuant to the provisions of this Paragraph. The third Arbitrator shall not be an Umpire. 
  
 (a) The following procedures for claiming arbitration shall apply: 
  

 31 

 (i) The Party wishing to submit a dispute to arbitration pursuant to this Article shall give written
notice by registered mail to the other Party of the nature and scope of the claim and the full name, profession and address of the arbitrator appointed by it. 
  

(ii) Within ten (10) days after having received such notice the other Party shall give written notice to the complaining Party of the full name
profession and address of its arbitrator, or, if such notice not given within such period, the second arbitrator will be appointed on request by the President of the London Maritime Arbitrators Association 30/32, St Mary Axe, London EC3A 8ET.

  
 (iii) If the two arbitrators thus appointed do not agree on
the appointment of the third arbitrator, that person shall be appointed by the President of the London Maritime Arbitrators Association upon the request of either Party. 
  
 (b) Any decision of the Arbitration Tribunal shall be by majority. An award of such arbitration shall be final and binding
upon both the Parties. 
  
 (c) The claimant in the arbitration to
serve points of claim within fourteen (l4) days of the appointment of the Arbitration Tribunal. 
  
 (d) The respondent in the arbitration to serve points of defence and points of counterclaim, if any, within fourteen (14) days thereafter. 
  
 (e) The claimant to serve points of reply and defence to counterclaim, if
any, within seven (7) days thereafter and the hearing of the arbitration to commence within twelve (12) weeks of the appointment of the Arbitration Tribunal. 
  
 (f) All arbitration proceedings shall be conducted in the English language. 
  
 (g) Judgement on any Award may be entered in any court of competent jurisdiction. 
  
 (h) In the event of the arbitration of any dispute or difference arising or
occurring prior to delivery to, or acceptance by, the BUYER of the VESSEL, the award by the Arbitration Tribunal shall include a finding as to whether the Delivery Date should, as a result of such dispute be altered thereby. 
  
 (i) The Arbitrators shall determine which party shall bear the expenses of
the arbitration or the portion of such expenses which each party shall bear. 
  
 ARTICLE XV: INSURANCE 
  
 1. EXTENT OF INSURANCE COVERAGE 
  
 From the time
of launching of the VESSEL until the same is completed, delivered to and accepted by the BUYER, the BUILDER shall, at its own cost and expense, keep the VESSEL and all machinery, materials, equipment, appurtenances and outfit, delivered to the
SHIPYARD or built into, or installed in or upon the VESSEL, including the BUYER’S SUPPLIES delivered 
  

 32 

 to the SHIPYARD, fully insured with first class insurance companies or underwriters in Korea under coverage corresponding
to the London Institute Builder’s Risks Clause. 
  
 The
amount of such insurance coverage shall, up to the date of delivery of the VESSEL, be in an amount at least equal to, but not limited to, the aggregate of the payments made by the BUYER to the BUILDER. 
  
 The policy referred to hereinabove shall be taken out in the name of BUILDER
and all losses under such policy shall be payable to the BUILDER. 
  
 2. APPLICATION OF RECOVERED AMOUNT 
  
 (a) Partial
Loss 
  
 In the event the VESSEL shall be damaged by any insured
cause whatsoever prior to acceptance thereof by the BUYER and in the further event that such damage shall not constitute an actual or a constructive total loss of the VESSEL, the BUILDER shall apply the amount recovered under the insurance policy
referred to in Paragraph 1 of this Article to the repair of such damage satisfactory to the CLASSIFICATION SOCIETY requirements, and the BUYER shall accept the VESSEL under this CONTRACT if completed and if it is upon delivery in all respects in
accordance with this CONTRACT and SPECIFICATIONS. 
  
 (b) Total
Loss 
  
 However, in the event that the VESSEL is determined to
be an actual or constructive total loss, the BUILDER shall, by the mutual agreement between the parties hereto, either 
  
 (i) Proceed in accordance with the terms of this CONTRACT, in which case the amount recovered under said insurance policy shall be applied to the
reconstruction of the VESSEL’s damage, provided the parties hereto shall have first agreed in writing as to such reasonable postponement of the Delivery Date and adjustment of other terms of this CONTRACT including the CONTRACT PRICE as may be
necessary for the completion of such reconstruction, or 
  
 (ii)
Refund immediately to the BUYER the amount of all installments paid to the BUILDER under this CONTRACT together with interest at the rate of ten per cent (10%) from the date of receipt thereof to the date of such refund, whereupon this CONTRACT
shall be deemed to be rescinded and all rights, duties, liabilities and obligations of each of the parties to the other shall terminate forthwith. 
  
 3. TERMINATION OF BUILDER’S OBLIGATION TO INSURE 
  
 The BUILDER’s obligation to insure the VESSEL hereunder shall cease and terminate upon delivery thereof and acceptance by the BUYER. 
  
 ARTICLE XVI: SUCCESSORS AND ASSIGNS 
  

 33 

 The BUILDER agrees that prior to delivery of the VESSEL, this CONTRACT may be: 
  
 (i) assigned by way of security to a bank or financier providing finance to
the BUYER in connection with the VESSEL, or 
  
 (ii) assigned to
another company with the prior written approval of the BUILDER, such approval not to be unreasonably withheld or delayed 
  
 Provided that in the case of any such assignment or novation the payment obligations of the BUYER continue to be guaranteed by [
            ] as provided in Article X.9. The BUILDER will in such case enter into such acknowledgements of assignment and/or novation agreements as the BUILDER may approve, such approval
not to be unreasonably withheld or delayed. 
  
 In the event of
any assignment or novation pursuant to the terms of this CONTRACT, the assignee, its successors and assigns shall succeed to all the rights and obligations of the BUYER under this CONTRACT. However, the BUYER shall remain responsible for performance
by the assignee, its successors and assigns of all the BUYER’s obligations, liabilities and responsibilities under this CONTRACT. It is understood that any expenses or charges incurred due to the transfer of this CONTRACT shall be for the
account of the BUYER. 
  
 The BUILDER shall have the right to
assign this CONTRACT at any time after the effective date hereof, provided that prior written agreement is obtained from the BUYER. 
  
 ARTICLE XVII: TAXES AND DUTIES 
  
 1. TAXES 
  
 Unless otherwise expressly provided for in this CONTRACT, all costs and taxes including stamp duties, if any, incurred in or levied by any country except
Korea in connection with this CONTRACT shall be borne by the BUYER and corresponding costs and taxes in Korea, before delivery of the VESSEL, if any, shall be borne by the BUILDER. 
  
 2. DUTIES 
  
 The BUILDER shall hold the BUYER harmless from any payment of duty imposed in Korea upon materials or supplies which, under the terns of this CONTRACT, or
amendments thereto, may be supplied by the BUYER from abroad for the construction of the VESSEL. 
  
 The BUILDER shall likewise hold the BUYER harmless from any payment of duty imposed in Korea in connection with materials or supplies for operation of the
VESSEL, including running stores, provisions and supplies necessary to stock the VESSEL for its operation. This indemnity does not, however, extend to any items purchased by the BUYER for use in connection with the VESSEL which are not absolutely
required for the construction or operation of the VESSEL. 
  
 ARTICLE XVIII: PATENTS, TRADEMARKS AND COPYRIGHTS 
  

 34 

 1. PATENTS, TRADEMARKS AND COPYRIGHTS 
  
 Machinery and equipment of the VESSEL, whether made or furnished by the
BUILDER under this CONTRACT, may bear the patent numbers, trademarks or trade names of the manufacturers. The BUILDER shall defend and save harmless the BUYER from all liabilities or claims for or on account of the use of any patents, copyrights or
design of any nature or kind, or for the infringement thereof including any unpatented invention made or used in the performance of this CONTRACT and also for any costs and expenses of litigation, if any in connection therewith. No such liability or
responsibility shall be with the BUILDER with regard to components and/or equipment and/or design supplied by the BUYER. 
  
 Nothing contained herein shall be construed as transferring any patent or trademark rights or copyrights in equipment covered by this CONTRACT, and all
such rights are hereby expressly reserved to the true and lawful owners thereof. 
  
 2. RIGHTS TO THE SPECIFICATIONS, PLANS, ETC 
  
 The BUILDER retains all rights with respect to the SPECIFICATIONS, plans and working drawings, technical descriptions, calculations, test results and other data, information and documents concerning the design and
construction of the VESSEL and the BUYER undertakes thereof not to disclose the same or divulge any information contained therein to any third parties, without the prior written consent of the BUILDER excepting where it is necessary for usual
operation, repair and maintenance chartering and sale of the VESSEL. 
  
 ARTICLE XIX: INTERPRETATION AND GOVERNING LAW 
  
 This CONTRACT has been prepared in English and shall be executed in duplicate and in such number of additional copies as may be required by either party respectively. The parties hereto agree that the validity and interpretation of this
CONTRACT and of each Article and part thereof shall be governed by the laws of England. 
  
 ARTICLE XX: NOTICE 
  
 Any
and all notices, requests, demands, instructions, advices and communications in connection with this CONTRACT shall be written in English be delivered by hand, or sent by registered air mail, telex or facsimile and shall be deemed to be given when
first received whether by registered mail, cable, telex or facsimile. They shall be addressed as follows, unless and until otherwise advised:- 
  

	 To the BUILDER :
	  	Hyndai Mipo Dockyard Co., Ltd.
	 	  	#1381, Bangeo-Dong Dong-Ku, Ulsan, Korea
		
	 	  	 
		
	 	  	Attention: Mr. S. W. Kwon (Contract Administration Dep’t)
		
	 	  	Facsimile: +82 (0)52 250 3060
	 	  	Telephone: +82 (0)52 250 2051

  
  
  
  
  
  

 35 

	 To the BUYER :
	  	[             ]	  	 

  
 The said notices shall
become effective upon receipt of the letter, telex or facsimile communication by the receiver thereof. Where a notice by facsimile is concerned which is required to be confirmed by letter, then, unless the CONTRACT or the relevant Article thereof
otherwise requires, the notice shall become effective upon receipt of the facsimile. 
  
 ARTICLE XXI: EFFECTIVENESS OF THIS CONTRACT 
  
 This CONTRACT shall become effective upon signing by the parties hereto. 
  
 If the Refund Guarantee is not issued by KOEXIM within three (3) months from the date hereof, then this CONTRACT shall be nullified without either party
thereby incurring any liability to the other. 
  
 ARTICLE XXII:
EXCLUSIVENESS 
  
 This CONTRACT shall constitute the only and
entire agreement between the parties hereto, and unless otherwise expressly provided for in this CONTRACT, all other agreements, oral or written, made and entered into between the parties prior to the execution of this CONTRACT shall be null and
void. 
  

 36

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