Document:

Shipbuilding Contract

 Exhibit 4.25 
 SHIP BUILDING CONTRACT 
 (Contract Number: CMEC2006C4196) 
 FOR 
 CONSTRUCTION OF ONE 2500 TEU
CONTAINER VESSEL 
 (HULL No. YZJ2006-722C) 
 Between 
 SEASPAN CORPORATION 
 as Buyer 
 and 
 JIANGSU YANGZIJIANG SHIPBUILDING CO., LTD. 
 as Seller 

 TABLE OF CONTENTS 
  

			
	 ARTICLE I — DESCRIPTION AND CLASS
	  	2
	 1. Description:
	  	2
	 2. Principal Dimensions and Characteristics:
	  	2
	 3. Classification, Rules and Regulations:
	  	3
	 4. Registration:
	  	4
	 5. Contract Specifications and Approved Drawings:
	  	4
	 6. Subcontracting and New Shipyard:
	  	4
	 ARTICLE II — CONTRACT PRICE AND TERMS OF PAYMENT
	  	5
	 1. Contract Price:
	  	5
	 2. Adjustment of Contract Price:
	  	5
	 3. Currency:
	  	5
	 4. Terms of Payment:
	  	6
	 (a) First Instalment:
	  	6
	 (b) Second Instalment:
	  	6
	 (c) Third Instalment:
	  	6
	 (d) Fourth Instalment:
	  	6
	 (e) Fifth Instalment:
	  	6
	 (f) Sixth Instalment (the “Delivery Instalment”):
	  	7
	 5. Method of Payment:
	  	7
	 6. Expenses:
	  	8
	 7. Advance Payment:
	  	8
	 8. Refundment Guarantee:
	  	8
	 ARTICLE III — ADJUSTMENT OF CONTRACT PRICE
	  	10
	 1. Delivery:
	  	10
	 2. Speed:
	  	11
	 3. Fuel Consumption:
	  	11
	 4. Deadweight:
	  	11
	 5. Container capacity:
	  	12
	 6. Reductions to be Independent of Each Other:
	  	12
	 7. Application of Adjustment:
	  	13
	 8. Effect of Rescission:
	  	13
	 ARTICLE IV — APPROVAL OF PLANS AND DRAWINGS AND INSPECTION DURING CONSTRUCTION
	  	14
	 1. Approval of Plans and Drawings:
	  	14
	 2. Appointment of BUYER’s Representatives:
	  	14
	 3. Inspection by BUYER’s Representatives:
	  	15
	 4. Rights of the Representatives:
	  	15
	 5. Facilities:
	  	17
	 6. Liability for the Representatives:
	  	17
	 7. Salaries and Costs:
	  	17
	 8. SELLER’s Obligation:
	  	17
	 9. Replacement of the Representatives:
	  	18
	 10. Responsibility of BUYER:
	  	18
	 11. Information to Representatives:
	  	18
	 ARTICLE V — MODIFICATIONS, CHANGES AND EXTRAS
	  	19
	 1. How Effected:
	  	19
	 2. Changes in Rules of Classification Society, Regulations, etc.:
	  	19
	 3. Substitution of Materials:
	  	20

  

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	 ARTICLE VI — TRIALS AND ACCEPTANCE
	  	21
	 1. Notice:
	  	21
	 2. Weather Condition:
	  	21
	 3. How Conducted:
	  	21
	 4. Method of Acceptance or Rejection:
	  	22
	 5. Effect of Acceptance:
	  	23
	 6. Disposition of Surplus Consumable Stores:
	  	23
	 ARTICLE VII — DELIVERY
	  	24
	 1. Time and Place:
	  	24
	 2. When and How Effected:
	  	24
	 3. Documents to be delivered to BUYER:
	  	24
	 4. Tender of VESSEL:
	  	25
	 5. Title and Risk:
	  	25
	 6. Removal of VESSEL:
	  	26
	 7. Notices:
	  	26
	 ARTICLE VIII — DELAYS AND EXTENSION OF TIME FOR DELIVERY (FORCE MAJEURE)
	  	27
	 1. Causes of Delay (Force Majeure):
	  	27
	 2. Notice of Delay:
	  	27
	 3. Definition of Permissible Delay:
	  	28
	 4. Right to Rescind for Excessive Delay:
	  	28
	 ARTICLE IX — WARRANTY OF QUALITY
	  	29
	 1. Guarantee:
	  	29
	 2. Guarantee from Manufacturers and Suppliers:
	  	29
	 3. Notice of Defects:
	  	29
	 4. Extent of SELLER’s Obligation:
	  	29
	 5. Remedy of Defects:
	  	30
	 6. Guarantee Period:
	  	31
	 7. Application to Defects Remedied:
	  	32
	 8. SELLER to Remain Liable:
	  	32
	 9. Guarantee Engineer:
	  	32
	 ARTICLE X — SELLER’s DEFAULT — RESCISSION BY BUYER
	  	34
	 1. SELLER’s Default:
	  	34
	 2. Effect of SELLER’s Default:
	  	35
	 3. Notice:
	  	35
	 4. Refundment by SELLER:
	  	35
	 5. Discharge of Obligations:
	  	36
	 ARTICLE XI — DEFAULT BY THE BUYER
	  	37
	 1. Definition of BUYER’s Default:
	  	37
	 2. Effect of BUYER’s Default on or before Delivery of VESSEL:
	  	37
	 3. Disposal of VESSEL:
	  	38
	 ARTICLE XII — ARBITRATION
	  	39
	 1. Decisions by the Classification Society:
	  	39
	 2. Proceedings of Arbitration:
	  	39
	 3. Notice of Award:
	  	40
	 4. Expenses:
	  	40
	 5. Entry in Court:
	  	40
	 6. Alteration of Delivery Date:
	  	40
	 ARTICLE XIII — ASSIGNMENT — SUCCESSOR AND ASSIGNS
	  	41
	 ARTICLE XIV — TAXES AND DUTIES
	  	42
	 1. Taxes and Duties Incurred in China:
	  	42
	 2. Taxes and Duties Incurred outside China:
	  	42

  

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	 ARTICLE XV — PATENTS, TRADEMARKS, COPYRIGHTS, ETC
	  	43
	 1. Patents, Trademarks and Copyrights:
	  	43
	 2, General Plans, Specifications and Working Drawings:
	  	43
	 ARTICLE XVI — BUYER’s SUPPLIES
	  	44
	 1. Responsibility of BUYER:
	  	44
	 2. Responsibility of SELLER:
	  	44
	 ARTICLE XVII — INSURANCE
	  	46
	 1. Extent of Insurance Coverage:
	  	46
	 2. Application of the Recovered Amounts:
	  	46
	 3. Termination of SELLER’s Obligation to Insure:
	  	47
	 ARTICLE XVIII — NOTICES
	  	48
	 1. Address:
	  	48
	 2. Language:
	  	48
	 3. Effective Date of Notice:
	  	48
	 4. Change of Address:
	  	49
	 ARTICLE XIX — EFFECTIVE DATE OF CONTRACT
	  	50
	 ARTICLE XX — INTERPRETATION
	  	51
	 1. Laws Applicable:
	  	51
	 2. Entire Agreement:
	  	51
	 3. Amendments and Supplements:
	  	51
	 4. Banking Day:
	  	51
	 5. No Set Off, Deduction or Counter-claim:
	  	51
	 6. Deemed Benefit for Servants, etc.:
	  	52
	 7. Responsibility:
	  	52
	 8. Time of the Essence:
	  	52
	 9. Headings:
	  	53
	 Exhibit “A”: IRREVOCABLE LETTER OF GUARANTEE NO.
	  	54
	 ATTACHMENT
	  	57

  

 iii 

 THIS CONTRACT, made and entered into on this 4th day of July, 2006, by and between: 
 Seaspan Corporation, a corporation incorporated and existing under the laws of the Republic of the Marshall
Islands, having a place of business at Unit 2, 7th Floor, Bupa Centre, 141 Connaught Road West, Hong Kong F4 00000,
China (hereinafter referred to as the “BUYER”), of the one part; 
 and 
 Jiangsu Yangzijiang Shipbuilding Co., Ltd., a company organized and existing under the laws of China with a registered office at Emeizui Huangshan, Jiangyin City,
Jiangsu Province, 214431, The People’s Republic of China (hereinafter referred to as the “SELLER”), of the other part. 
 WITNESSETH:

 In consideration of the mutual covenants herein contained, the SELLER agrees to design, build, launch, equip and complete in accordance with first class
shipbuilding practice in China, this Contract, the Specifications, the Approved Drawings and the Classification Society Rules, in all respects, one (1) Ocean Going Single Screw diesel engine driven fully Cellular Container Vessel as described
herein and in the Specifications referred to herein (hereinafter called the “VESSEL” which term shall, where it appears, include its design, drawings, plans, machinery, engines, equipment, fittings, outfittings, appurtenances,
furniture, materials, parts, spares, articles and things whatsoever specified or required by the Specifications and/or otherwise under this Contract), at the SELLER’s shipyard located in Emeizui Huangshan, Jiangyin City, Jiangsu Province,
People’s Republic of China (hereinafter called the “Shipyard”) and to deliver and sell the same to the BUYER free and clear of all liens, charges, mortgages and encumbrances, and the BUYER hereby agrees to purchase and
accept delivery of the VESSEL from the SELLER and to pay for the same upon the terms and conditions hereinafter set forth. 
  

 1 

 ARTICLE I — DESCRIPTION AND CLASS 
  

	1.	Description: 

 The VESSEL shall be a Single Screw Cellular
Container VESSEL having the SELLER’s Hull No. YZJ2006-722C and shall be designed, constructed, equipped, inspected, tested, ready for sea and suitable in all respects for its intended use, in accordance with the provisions of this Contract, the
Specifications, the Approved Drawings and the Classification Society Rules (each as hereinafter defined). The Approved Drawings and the Classification Society Rules shall constitute an integral part hereof. A reference hereafter in this Contract to
Specifications shall be deemed to include the Approved Drawings and the Classification Society Rules. The SELLER undertakes that the quality of the design, construction, testing and trials of the VESSEL and the quality of the VESSEL and of her
workmanship shall be in accordance with the first class shipbuilding practice in China. 
  

	2.	Principal Dimensions and Characteristics: 

  

	(a)	The SELLER guarantees that the VESSEL will have the following: 

  

					
	Length, overall	  	app.	  	208.50 m
	Length, between perpendiculars	  		  	196.50 m
	Breadth, moulded	  		  	  29.80 m
	Depth, moulded	  		  	  16.40 m
	Designed draught, moulded	  		  	  10.10 m
	Scantling draught, moulded	  		  	  11.50 m
	Main Engine	  		  	MAN B&W 6K80MC-C
		  		  	(with alpha lubricator)
	MCR x RPM	  		  	21660KWat104RPM
	CSR (90% MCR)	  		  	19494 KW at 100.4 RPM

  

	(b)	The SELLER guarantees that the VESSEL shall have the following capacity of ISO standard 20’ x 8’ x 8’ 6” Containers (the “Guaranteed Container
Capacity”), compliant with IMO visibility requirements, namely: 

 Nominal capacity 
  

			
	Under deck-	  	  984 TED
	On deck -	  	1562 TEU (in 8 tiers)
	Total -	  	2546 TEU

 Homogenous capacity (14 ton per TEU): 1900 TEU 
  

	(c)	The SELLER guarantees that the VESSEL shall have a deadweight of not less than 33,800 metric tons on scantling draught as calculated in accordance with the provisions of the
Specifications (hereinafter called the “Guaranteed Deadweight”). The actual deadweight of the VESSEL expressed in tonnes of 1,000 kilograms shall be determined in the presence of the Representatives of the BUYER, the Classification
Society and the SELLER on the basis of the actual measurement of the lightweight of the completed VESSEL, and thereafter a certificate of deadweight shall be issued by the SELLER. The cost, if any, shall be for the account of the SELLER.

  

 2 

	(d)	The SELLER guarantees that the speed of the VESSEL, based on calculations from sea trial as stipulated and on the conditions prescribed in the Specifications, shall be twenty two
(22) knots, at design draught of 10.10 metres and at CSR (90% MCR) of main engine (hereinafter called the “Guaranteed Speed”). 

  

	(e)	The SELLER guarantees that fuel consumption for the main engine, the figure of which shall be calculated by applying I.S.O. reference condition to the result obtained at the shop
trial, shall not exceed 171 g/KWh at a normal continuous output as stipulated and on the conditions prescribed in the Specifications (hereinafter called the “Guaranteed Fuel Consumption”). 

 The details of the aforementioned particulars as well as the definitions and method of measurements and calculations are as indicated in the Specifications. 

 

	3.	Classification, Rules and Regulations: 

 The VESSEL shall be
designed, constructed, equipped, inspected, tested and completed in accordance with the rules and regulations of and under special survey of Lloyds Register of Shipping (hereinafter called the “Classification Society”), the
editions and amendments in force as of February 28, 2006 (the “Classification Society Rules”, and wherever the term “Classification Society Rules” is used in this Contract, it means the rules of the
Classification Society as stipulated in the Contract and the Specifications). 
 The VESSEL shall be distinguished in the register by the symbol of
†100A1 Containership *IWS, LI, ShipRight (SDA, CM) †LMC, UMS NAV1, SCM, with descriptive notes “ShipRight BWMP(F). Pt. Ht.” Details of Class notation shall be in accordance with the Specifications. 
 Decisions of the Classification Society as to compliance or non-compliance with the classification rules and regulations shall be final and binding upon both parties
hereto, except where this Contract provides for Arbitration. 
 The VESSEL shall comply with rules, regulations, recommendations and requirements of the
authorities as described and listed in the Specifications in force as of February 28, 2006, together with all mandatory rules and regulations with amendment, which have already been ratified up to February 28, 2006, and to come into effect
prior to the scheduled delivery date of the VESSEL. 
 The SELLER shall arrange with the Classification Society for the assignment by the Classification
Society of a representative (hereinafter referred to as the “Classification Surveyor”) to the VESSEL during all stages of construction. All materials, workmanship and major plans used in the construction of the VESSEL shall
be subject to inspection and test by the Classification Society in accordance with the rules and regulations of the Classification Society. All fees and charges in connection with or incidental to the classification of the VESSEL, to all
certificates required under this Contract and the Specifications, and to compliance with the above specified rules, regulations and requirements, shall be for the account of the SELLER. 

 3 

 No omission of the Classification Society and/or Classification Surveyor shall, in any way, diminish or impair the
obligations and liabilities of the SELLER under the terms of this Contract. 
  

	4.	Registration: 

 The VESSEL, at the time of her delivery and
acceptance, shall be designed and constructed to qualify for registration at the port of registry by the BUYER under the Hong Kong flag. The costs of registration of the VESSEL in Hong Kong are for the BUYER’s expense. The SELLER shall obtain
and deliver to the BUYER at delivery and acceptance the Certificates required pursuant to the Specifications. 
  

	5.	Contract Specifications and Approved Drawings: 

  

	(a)	Definition 

 In this Contract,
“Specifications” means the full specifications with reference no. M2004M-4034-01A, General Arrangement Drawing reference no. Q84.4197.100.002, Midship Section reference no. Q84.4197.110.001 and Makers List reference no.
M2004M-4034-02A signed by each of the parties for identification and constituting an integral part hereof. In this contract “Approved Drawings” means the drawings and plans approved by the BUYER pursuant to ARTICLE IV, Clause 1.
Subject to provisions of Sub-clause (b) hereunder, the Specifications and the Approved Drawings are intended to complement this Contract as well as one another and everything contained in the Specifications and/or the Approved Drawings shall
have full force and effect as if incorporated within the body of this Contract. 
 The parties acknowledge that the design and configuration
of the VESSEL is based on the design and configuration for Hull No. YZJ2004-680C, subject to the Specifications, the drawings approved pursuant to ARTICLE IV and this Contract. 
  

	(b)	Precedence 

 Should there be any inconsistency or
discrepancy between this Contract and the Specifications or between this Contract and the Approved Drawings, this Contract shall prevail. Should there be any inconsistency or discrepancy between the Specifications and the Approved Drawings, the
Specifications shall prevail. 
  

	6.	Subcontracting and New Shipyard: 

 The SELLER may, with prior
written notice to and consent from the BUYER, subcontract construction of the blocks of the VESSEL, except the major hull structure parts, to experienced subcontractors within Jiangsu Province area, but delivery and final assembly into the VESSEL of
any such work subcontracted shall be at the yard of the SELLER. The BUYER acknowledges that the SELLER is affiliated with the shipyard located at Jingjiang, Jiangsu Province (the “New Shipyard”) and the SELLER may use the New
Shipyard for construction of the VESSEL. The SELLER shall always remain fully responsible for the performance of this Contract with regard to the work done or materials supplied or used by such Subcontractors or the New Shipyard in accordance with
this Contract. The subcontractors and the New Shipyard shall perform up to the same standard as the SELLER for such work performed by them. 
 (end of
Article) 
  

 4 

 ARTICLE II — CONTRACT PRICE AND TERMS OF PAYMENT 
  

	1.	Contract Price: 

 The agreed purchase price of the VESSEL is
forty-one million two hundred and fifty thousand United States Dollars (US$41,250,000), net receivable by the SELLER (hereinafter called the “Contract Price”). 
 The Contract Price shall be subject to upward or downward adjustment, if any, as herein after set forth in this Contract. The Contract Price includes payment for services in the design, inspection, tests, trials,
survey and classification of the VESSEL which shall be rendered by the Classification Society and all costs and expenses for supplying all drawings and plans (except those to be furnished by the BUYER in respect of the BUYER’s Supplies) and
designs, machinery, engines, equipment, fittings, outfittings, appurtenances, furniture, materials, parts, spares, articles and things whatsoever and specified or required by the Specifications and/or otherwise under this Contract for the VESSEL and
all other items and acts necessary for the due and punctual performance of the SELLER’s obligations under or pursuant to this Contract. 
 The Contract
Price does not include the cost of items to be supplied by the BUYER as stipulated in Clause 1 of ARTICLE XVI of this Contract. 
  

	2.	Adjustment of Contract Price: 

 Any increase or decrease of the
Contract Price due to adjustments made in accordance with the provisions of this Contract shall be adjusted by way of addition to or subtraction from the Delivery Instalment of the Contract Price upon delivery of the VESSEL in the manner as
hereinafter provided. 
 No later than five (5) Banking Days prior to the scheduled date for the acceptance of delivery of the VESSEL, the parties
hereto shall conclude an agreement on all adjustments of the Contract Price, if any. If the parties cannot agree on the adjustments specified in ARTICLE III, delivery of the VESSEL shall take place as provided herein and: 
  

	 	(a)	the adjustments to which the parties have agreed will be made to the Delivery Instalment; and 

  

	 	(b)	the adjustments or portion thereof that have not yet been agreed shall be determined by arbitration pursuant to ARTICLE XII herein. 

 Notwithstanding the foregoing, adjustment in connection with the delay in delivery of the VESSEL shall be made on delivery to the Delivery Instalment. 
  

	3.	Currency: 

 Any and all payments which are due under this Contract
or to be refunded under the terms thereof shall be made in United States Dollars. 
  

 5 

	4.	Terms of Payment: 

 Subject to ARTICLE II, Clause 8, the Contract
Price shall be due and payable by the BUYER to the SELLER in five instalments as follows: 
  

	(a)	First Instalment: 

 The first instalment amounting to
US$4,125,000 representing ten percent (10%) of the Contract Price shall be due and payable and shall be paid by the BUYER within five (5) Banking Days of the Effective Date (as defined by ARTICLE XIX). 
  

	(b)	Second Instalment: 

 The second instalment amounting to
US$4,125,000 representing ten (10%) of the Contract Price shall be due and payable and shall be paid on the first Banking Day that is twelve (12) months after the date of this Contract. 
  

	(c)	Third Instalment: 

 The third instalment amounting to
US$4,125,000 representing ten percent (10%) of the Contract Price shall be due and payable and shall be paid within seven (7) Banking Days of receipt of the notice of cutting of the first steel plate of the VESSEL in the SELLER’s
workshop having occurred. 
 The SELLER shall give a fax or letter notice to the BUYER stating that the first steel plate has been cut in its
workshop and demand for payment of this instalment. Such notice shall include a builder’s certificate of the SELLER of steel cutting, which shall be endorsed by the Classification Surveyor. 
  

	(d)	Fourth Instalment: 

 The fourth instalment amounting to
US$4,125,000 representing ten percent (10%) of the Contract Price shall be due and payable and shall be paid within seven (7) Banking Days of receipt of notice of keel-laying of the first section of the VESSEL. 
 The SELLER shall give a fax or letter notice to the BUYER stating that the first section has been carried out and demand for payment of this instalment.
Such notice shall include a builder’s certificate of the SELLER of keel-laying, which shall be endorsed by the Classification Surveyor. 
  

	(e)	Fifth Instalment: 

 The fifth instalment amounting to
US$4,125,000 representing ten percent (10%) of the Contract Price shall be due and payable and shall be paid within seven (7) Banking Days of receipt of notice of launching of the VESSEL. 
 The SELLER shall give a fax or letter notice to the BUYER stating that the launching has been carried out and demand for payment of this instalment. Such
notice shall include a builder’s certificate of the SELLER of launching which shall be endorsed by the surveyor of the Classification Society. 
  

 6 

	(f)	Sixth Instalment (the “Delivery Instalment”): 

 The sixth instalment amounting to US$20,625,000 representing fifty percent (50%) of the Contract Price, plus any increase or minus any decrease due to adjustment of the Contract Price under the provisions of this Contract shall be due
and payable and shall be paid simultaneously with the delivery to and acceptance of the VESSEL by the BUYER and upon the signing of the Protocol of Delivery and Acceptance by both parties. 
  

	5.	Method of Payment: 

 All the pre-delivery payments and the payment
due on delivery in settlement of the Contract Price as provided for in Clause 4 of this ARTICLE II shall be made in United States Dollars on or before the due date thereof by telegraphic transfer as follows: 
  

	(a)	Payment of the instalments prior to the Delivery Instalment 

 Payment of the first, second, third, fourth and fifth instalments shall be made by remitting the respective amounts, at the BUYER’s own cost and expense, to the receiving bank nominated by the SELLER and advised to the BUYER not less
than ten (10) days prior to the date of the relevant instalment, for credit to the account of the SELLER with SELLER’s Bank, or through other receiving bank to be nominated by the SELLER from time to time, and such nomination shall be
notified to the BUYER at least ten (10) days prior to the due date for payment (herein referred to as the “SELLER’s Bank”). 
  

	(b)	Payment of the Delivery Instalment 

 The BUYER shall, at
least three (3) business days prior to the actual date of delivery of the VESSEL, request the BUYER’s bank to make an irrevocable cash deposit in an account in the name of the BUYER’s bank with the SELLER’s Bank, the
People’s Republic of China, for a period of fifteen (15) days and covering the amount of this instalment (as adjusted in accordance with the provisions of this Contract), with an irrevocable instruction that the said amount shall be
released to the SELLER against presentation by the SELLER to the said SELLER’s Bank of a copy of the Protocol of Delivery and Acceptance signed by the BUYER’s authorized representative and the SELLER. Interest, if any, accrued from such
deposit, shall be for the benefit of the BUYER. 
 If the SELLER has not presented the said original of the Protocol of Delivery and Acceptance duly signed
by the SELLER and BUYER to the SELLER’s Bank on or before the expiry of the aforesaid fifteen (15) day deposit period, the BUYER shall have the right to withdraw the said deposit plus accrued interest upon the expiry of such fifteen
(15) day period. However, if a new delivery date is agreed to between the BUYER and the SELLER, the BUYER shall make the cash deposit in accordance with the same terms and conditions as set out above. 
 The SELLER’s Bank will be Bank of China Ltd. (Guangdong Branch), Bank of China Ltd. (Jiangyin Branch), the Export-Import Bank of China or such other bank to which
the SELLER and BUYER may agree. 
  

 7 

 For the avoidance of doubt any interest earned on the cash deposit before delivery and acceptance of the VESSEL shall
belong to the BUYER and the BUYER shall be entitled to instruct the Bank accordingly. 
 If or when the SELLER advises the BUYER of a revised scheduled
delivery date in accordance with this Contract, the BUYER shall redeposit the Delivery Instalment in the same manner as stated above at least one business day prior to such revised scheduled delivery date or if not possible upon notice. 

Simultaneously with each of such payments, the BUYER shall advise the SELLER of the details of such payments by telex, fax or cable. 
 If any of the above payment dates is not a Banking Day then the payment(s) so due on such non-Banking Day shall be understood to be payable on the next Banking Day after
the date on which payment should have been made in accordance with this Clause 5. 
 In the event of default in the payment of any instalment in Clause
(a) or (b) of this Clause 5, the BUYER shall pay default interest, charges and expenses in accordance with Clause 2 (a) of ARTICLE XI hereof. 
  

	6.	Expenses: 

 All charges, expenses and bank charges outside of China
for remitting payments and any taxes, duties, expenses and fees outside of China connected with such payment shall be for the account of the BUYER. All charges, expenses and bank charges and any taxes, duties, expenses and fees arising inside China
for remitting payment shall be for the account of SELLER. 
  

	7.	Advance Payment: 

 The payment of the Contract Price by way of the
instalments set out in Clause 4 of this ARTICLE II shall be in the nature of advance(s) and shall be subject to refund to the BUYER in accordance with the provisions of this Contract. 
  

	8.	Refundment Guarantee: 

 As security for the refund of instalments
paid by the BUYER to the SELLER prior to delivery of the VESSEL, including interest thereon as set out in ARTICLE X herein, the SELLER will provide the BUYER with an Irrevocable Letter of Refundment Guarantee (the “Refundment
Guarantee”) in favour of the BUYER issued by the SELLER’S Bank (hereinafter called the “Refundment Guarantor”) for each instalment of the Contract Price. Each Refundment Guarantee will cover the amount of
the relevant instalment, together with interest thereon as set out in ARTICLE X herein, and the receipt of the Refundment Guarantee by the BUYER is a pre-condition to payment by the BUYER of the relevant instalment. 
 Alternatively, the SELLER may provide the BUYER with one Refundment Guarantee issued by the Refundment Guarantor
that covers the aggregate amount of 1st, 2nd, 3rd, 4th and 5th instalments together with interest thereon as set out in ARTICLE X herein. This form of Refundment Guarantee would remain a pre-condition to the payment by the BUYER of the first instalment. 
  

 8 

 The Refund Guarantee or Guarantees, as the case may be, will become effective upon receipt of the relevant instalment to
which the Refund Guarantee relates by the SELLER and must remain in effect until the earlier of: (1) the VESSEL is delivered to and accepted by the BUYER; (2) a refund of the full amount covered by the Refund Guarantee has been made by the
SELLER or the Refund Guarantor; and (3) 180 days after the Delivery Date. The BUYER will not be required to make any further instalment to the SELLER if at any time a Refund Guarantee or Guarantees which was in effect ceases to be in effect.

 The Refundment Guarantee or Guarantees, as the case may be, shall be substantially in the form of Exhibit “A” attached hereto. If the condition
in Article XIX (b) is satisfied, the SELLER will have sixty (60) days from the condition satisfaction date to provide to the BUYER a Refundment Guarantee with respect to the first instalment substantially in the form attached as Exhibit
“A” hereto and approved by the Refund Guarantor and the BUYER’S bank. Prior to delivery to the BUYER, the Refundment Guarantee or Guarantees, as the case may be, must be registered with or approved by (only if registration or approval
is required) the relevant government agencies pursuant to any legislation in the People’s Republic of China applicable to the provision of such instruments, including The State Administration of Foreign Exchange. 
 However, in the event of any dispute between the SELLER and the BUYER with regard to the SELLER’s obligation to repay the instalment or instalments paid by the
BUYER and to the BUYER’s right to demand payment from the Refundment Guarantor, under its guarantee, and such dispute is submitted either by the SELLER or by the BUYER for arbitration in accordance with ARTICLE XII hereof, the Refundment
Guarantor shall withhold and defer payment until the arbitration award between the SELLER and the BUYER is published. The Refundment Guarantor shall not be obliged to make any payment unless the arbitration award orders the SELLER to make repayment.
If the SELLER fails to honour the award within 10 days of notice, then the Refundment Guarantor shall make payment to the BUYER under the Refundment Guarantee. 
 All expenses in issuing and maintaining the Refundment Guarantee or Refundment Guarantees, as the case may be, by the Refund Guarantor shall be borne by the SELLER. 
 (end of Article) 
  

 9 

 ARTICLE III — ADJUSTMENT OF CONTRACT PRICE 
 The Contract Price shall be subject to adjustment, as hereinafter set forth, in the event of any of the following contingencies (it being agreed and understood by both
parties that any reduction of the Contract Price under this ARTICLE III is by way of liquidated damages and not by way of penalty). 
  

	1.	Delivery: 

  

	(a)	No adjustment shall be made and the Contract Price shall remain unchanged for the first thirty (30) days of delay in delivery of the VESSEL beyond the Delivery Date as defined
in ARTICLE VII hereof (ending as of 11:59 p.m. in China of the 30th day of delay). 

  

	(b)	If the delivery of the VESSEL is delayed by more than thirty (30) days after the Delivery Date, then, in such event, beginning at twelve o’clock midnight in China of the
30th day after the Delivery Date, the Contract Price shall be reduced by deduction therefrom as follows: from the 31st day to 60th day — US$15,000 per day and from the 61st day to the 150th day — US$23,500 per day. In any event (including
the event that the BUYER consents to take the VESSEL at the later delivery date after the expiration of one hundred and fifty (150) days delay of delivery as described in Clause 1(c) of this ARTICLE III or in Clause 4 of ARTICLE VIII) the total
reduction in the Contract Price shall not exceed the amount due to cover the delay of 120 days after the first 30 days hereinabove referred to for the delay in delivery of the VESSEL at the rate of reduction as specified above.

  

	(c)	However, if the delay in delivery of the VESSEL should continue for a period of one hundred and fifty days from the Delivery Date, then in such event, and after such period has
expired, the BUYER may, at its option, rescind this Contract in accordance with the provisions of ARTICLE X hereof and reject the VESSEL. 

 The SELLER may, at any time after the expiration of the aforementioned one hundred and fifty days of delay in delivery, if the BUYER has not served notice of rescission as provided in ARTICLE X hereof, demand in
writing that the BUYER shall make an election, in which case the BUYER shall within twenty (20) days after such demand is received by it notify the SELLER of its intention either to rescind this Contract or to consent to the acceptance of the
VESSEL at an agreed future date. If the BUYER shall not make an election within twenty (20) days as provided herein above, the BUYER shall be deemed to have accepted such extension of the delivery date to the future delivery date indicated by
the SELLER and it being understood by the parties hereto that if the VESSEL is not delivered by such future date, the BUYER shall have the same right of rescission upon the same terms and conditions as herein above provided. 
  

	(d)	For the purpose of this ARTICLE III, the delivery of the VESSEL shall be deemed not to be delayed and the Contract Price shall not be reduced when and if the Delivery Date of the
VESSEL is extended by reason of causes and provisions of ARTICLE IV Clause 4(i)(2), ARTICLE V, ARTICLE VI, ARTICLE XI, ARTICLE XII, ARTICLE XVI and ARTICLE XVII or by reason of Permissible Delay as defined in ARTICLE VIII. 

 

 10 

	2.	Speed: 

  

	(a)	The Contract Price shall not be affected or changed by reason of the actual trial speed (as determined according to the Specifications) being less than the Guaranteed Speed, if such
deficiency is not more than 0.15 of one (1) knot below the Guaranteed Speed. 

  

	(b)	However, commencing with and including a deficiency of more than 0.15 of one (1) knot in actual speed below the Guaranteed Speed, the Contract Price shall be reduced by
USD50,000 for each successive whole 0.10 of a knot and pro-rata for any fraction thereof in excess of a deficiency of 0.15 of a knot. 

  

	(c)	If the deficiency in the actual trial speed upon final sea trial is more than 0.55 of a knot below the Guaranteed Speed of the VESSEL, then the BUYER may, at its option, reject the
VESSEL and rescind this Contract in accordance with the provisions of ARTICLE X hereof, or may accept the VESSEL at a reduction in the Contract Price as above provided that the total reduction does not exceed two hundred thousand United States
Dollars (US$200,000) being the maximum. 

  

	3.	Fuel Consumption: 

  

	(a)	The Contract Price shall not be affected or changed in case the actual fuel consumption, as determined by the engine manufacturer’s shop trial (171 g/KWh) as specified in the
Specifications, is not more than tolerance margin of five percent (5%) in excess of the Guaranteed Fuel Consumption. 

  

	(b)	However, in the event that the actual fuel consumption at the shop trial is in excess of five percent (5%) of the Guaranteed Fuel Consumption, the Contract Price shall be
reduced by the sum of seventy thousand United States Dollars (US$70,000) for each full one percent (1%) increase in fuel consumption and pro rata for any fraction of one percent (1%) of the Guaranteed Fuel Consumption in excess of the said
five percent (5%) up to maximum of eight percent (8%) over the Guaranteed Fuel Consumption. 

  

	(c)	If the fuel consumption of the main engine exceeds the Guaranteed Fuel Consumption by more than eight percent (8%), then the BUYER may, at its option, reject the VESSEL and rescind
this Contract in accordance with the provisions of ARTICLE X hereof, or may accept the VESSEL at a reduction in the Contract Price as above provided for eight percent (8 %) only, that is, at a total reduction of two hundred and ten thousand United
Stated Dollars (US$210,000) being the maximum. 

  

	4.	Deadweight: 

  

	(a)	In the event that there is a deficiency in the actual deadweight of the VESSEL (33800 MT) determined as provided in the Specifications, the Contract Price shall not be decreased if
such deficiency is two hundred (200) metric tons or less below the guaranteed deadweight described in the Specification. 

  

	(b)	In the event that the actual deadweight of the VESSEL as determined in accordance with the Specifications is less than the Guaranteed Deadweight, the Contract Price shall be reduced
by the sum of two thousand United States Dollars (US$2,000) for each full metric ton of such deficiency being more than two hundred (200) metric tons. 

  

 11 

	(c)	In the event of such deficiency in the actual deadweight of the VESSEL being eight hundred (800) metric tons or more, then the BUYER may, at its option, reject the VESSEL and
rescind this Contract in accordance with the provisions of ARTICLE X hereof or accept the VESSEL at a reduction in the Contract Price as above provided for eight hundred (800) metric tons only, that is, at a total reduction of one million two
hundred thousand United States Dollars (US$1,200,000). 

  

	5.	Container capacity: 

  

	(a)	In the event that the actual nominal container capacity of the VESSEL as determined in accordance with the Specifications is less than the Guaranteed Container Capacity of 2546 TEU
by more than forty-six (46) TEUs, the Contract Price shall be reduced by the sum of thirty thousand United States Dollars (US$30,000) for each container TEU of deficiency in excess of forty-six (46) TEUs. 

  

	(b)	In the event of the foregoing deficiency is fifty-five (55) TEU containers or more, the BUYER may, at its option reject the VESSEL and rescind this Contract in accordance with
the provisions of ARTICLE X hereof or may accept the VESSEL at a total reduction in the Contract Price as above provided of two hundred and seventy thousand United States Dollars (US$270,000). 

  

	(c)	Notwithstanding anything contained herein, the homogenous intake of containers of 14 ton TEU will not be below 1900. 

  

	(d)	In the event that the actual homogenous intake of containers of 14 ton TEU is less than 1900, the Contract Price shall be reduced by the sum of: (1) twenty-one thousand five
hundred United States Dollars (US$21,500) for each TEU lof such deficiency up to and including twenty (20) TEUs; and (2) thirty-five thousand United States Dollars (US$35,000) for each TEU of such deficiency from and including twenty-one
(21) TEU up to and including twenty-five TEU. 

  

	(e)	In the event of such deficiency in the actual homogenous intake of containers being twenty-six (26) TEU or more, then the BUYER may, at its option, reject the VESSEL and
rescind this Contract in accordance with the provisions of ARTICLE X hereof or may accept the VESSEL at a total reduction in the Contract Price as above provided of six hundred and five thousand United States Dollars (US$605,000).

  

	6.	Reductions to be Independent of Each Other: 

 Reductions permitted
herein are independent of each other and in the event of there being contingencies which necessitate the application of two or more Clauses, there shall be separate reductions in the Contract Price in respect of each contingency. 
  

 12 

	7.	Application of Adjustment: 

 Unless the parties agree otherwise, the
total reduction in the Contract price shall be deducted from the Delivery Instalment of the Contract Price in accordance with ARTICLE II, Clause 4. 
  

	8.	Effect of Rescission: 

 It is expressly understood and agreed by the
parties hereto that in any case as stated herein, if the BUYER rescinds this Contract pursuant to any provision under this ARTICLE III, the BUYER, save its rights and remedies set out in ARTICLE X hereof, shall not be entitled to any liquidated
damages or compensation whether described above or otherwise. 
 (end of Article) 
  

 13 

 ARTICLE IV — APPROVAL OF PLANS AND DRAWINGS AND INSPECTION DURING CONSTRUCTION 
  

	1.	Approval of Plans and Drawings: 

  

	(a)	The SELLER shall submit to the BUYER three (3) copies of the plans and drawings to be submitted thereto for its approval at its address as set forth in ARTICLE XVIII hereof.
For those plans and drawings that have been approved as of the date of the Contract by the BUYER of Hull No. YZJ2004-680C and are unaffected by Specifications herein, the SELLER shall submit such plans and drawings to the BUYER within 45 days of
date of the Contract. The BUYER shall have ninety (90) days thereafter to submit comments and return one plan or drawing, as the case may be, to the SELLER. 

 For all other plans and drawings, to be approved hereunder, the BUYER shall, within twenty-one (21) days after receipt thereof, return to the SELLER
one (1) copy of such plans and drawings with the BUYER’s approval or comments written thereon, if any, within the terms of the Specifications and the Contract. The SELLER must respond to the comments of the BUYER within twenty-one 21 days.
Any alterations to the Specifications resulting from such comments shall be dealt with in accordance with ARTICLE V, Clause 1. If any modifications and or changes are made to the plans which have been reviewed or approved by the BUYER, the SELLER
shall submit such plans either partially or totally to the BUYER for reapproval in accordance with this Clause. A list of the plans and drawings to be so submitted to the BUYER shall be mutually agreed upon between the parties hereto and such plans
and drawings shall then constitute “Approved Drawings”. 
  

	(b)	In the event that the BUYER shall fail to return the plans and drawings to the SELLER by fax or otherwise within the time limit as hereinabove provided, such plans and drawings
shall be deemed to have been automatically approved without any comment. 

  

	(c)	No act or omission of the BUYER in reviewing or approving the plans and/or drawings shall, in any way, diminish or impair the obligations and liabilities of the SELLER under the
terms of this Contract. 

  

	2.	Appointment of BUYER’s Representatives: 

 The BUYER may send to
and maintain at the Shipyard, at the BUYER’s own cost and expense, one or more Representatives who shall be duly authorized in writing by the BUYER (herein called the “Representatives”) to supervise the construction by the
SELLER of the VESSEL and to act on behalf of the BUYER in connection with the modifications of the Specifications, approval of the plans and drawings, attendance to the tests, inspections and trials relating to the VESSEL, and any other matters for
which he is specifically authorized by the BUYER. The Representatives may appoint assistant(s) to attend at the Shipyard for the purposes as aforesaid. 
 Upon appointment of the Representatives, the BUYER shall notify the SELLER in writing of the name and the scope of authority of the Representatives. Before the commencement of any item of work under this Contract, the SELLER shall, whenever
reasonably required, exhibit, furnish to, and within the limits of the Representative’s authority, secure the approval from the Representatives of any plans and drawings prepared in connection therewith. 
  

 14 

	3.	Inspection by BUYER’s Representatives: 

 The necessary
inspections and testing of the VESSEL shall be carried out by the Classification Society, other regulatory bodies and an inspection team of the BUYER, including the Representatives, throughout the entire period of construction, in order to ensure
that the construction of the VESSEL is duly performed in accordance with this Contract and the Specifications. 
  

	4.	Rights of the Representatives: 

  

	 	(a)	The Representatives shall, at all times during the construction until delivery and acceptance of the VESSEL, have the reasonable right to inspect the VESSEL and all work in
progress, materials utilized and quality of work in connection with the construction thereof wherever such work is being done within the Shipyard’s premises or wherever such materials and equipment are stored, for the purpose of determining
that the VESSEL is being constructed in accordance with the terms of this Contract and the Specifications. 

  

	 	(b)	The Representatives shall have the unrestricted right to visit the VESSEL and all work in progress. The Representatives shall also have the reasonable right to visit, with the
SELLER’S attendance or introduction as necessary, all property and premises utilized in connection with the construction of the VESSEL, wherever and whenever such premises is being utilized or such property is stored. 

 

	 	(c)	The construction of the VESSEL shall be subjected, throughout the entire period of construction, to quality control by a quality control department of the SELLER. The necessary
tests and inspection by the Classification Society and other regulatory bodies concerned shall also be carried out and recorded and all results of quality control and tests and inspections shall be communicated in the form documented, or in the
absence of documentation, orally, to the Representatives. 

  

	 	(d)	The Representatives may attend during construction of the VESSEL, tests and inspection of the VESSEL, its machinery and equipment. The SELLER shall give the Representatives at least
one (1) week advance notice for tests and inspections within the Shipyard stating approximate particulars of any tests or inspections which may be attended by the Representatives provided that in exceptional circumstances the manner in which
such notice is given may be modified by mutual agreement. Notice of tests and inspections to be conducted shall also be given to the Representatives latest up to 5:00 p.m. of the day prior to the day on which any tests or inspections shall occur.

 For test or inspections outside the Shipyard, including manufacturer’s shop tests, sufficient advance notice to allow
for the Representatives to arrange transportation shall be given. This advance notice should not be less than seven (7) days for tests or inspections that require air travel for attendance. 
  

 15 

 
Inspection schedule must be reasonable at all times in order to allow the BUYER’s Representatives to carry out their duties properly and inspections
must be spread over a reasonable time, but to follow building schedule at the same rate. In principle, inspections will not take place on Saturdays, Sundays and Holidays, unless mutually agreed upon and necessary in order to meet the SELLER’s
schedule. 
 Failure of the Representatives to be present at the tests and inspections after due notice shall be deemed to be a waiver of the
BUYER’s right to be present. In such case the BUYER shall be obliged to accept the result of such test on the basis of the SELLER’S certificate, signed by the Classification Society, that the said result is conforming to the provisions of
this Contract and the Specifications. 
  

	(e)	The Representatives shall notify the SELLER promptly, in writing, if, in his opinion, the VESSEL is not being constructed in accordance with this Contract or the Specifications. The
BUYER may at its election send a copy of such notification to the Classification Society. 

  

	(f)	No act or omission of the Representatives or his assistants shall, in any way, diminish or impair the liability of the SELLER under this Contract and/or the Specifications.

  

	(g)	The Representatives shall advise and consult the SELLER on all matters pertaining to the construction of the VESSEL, as may be required by the SELLER, or as he may deem necessary.

  

	(h)	The inspection thus exercised on behalf of the BUYER shall not alter or diminish the responsibility of the SELLER to construct the VESSEL in accordance with the Contract and the
Specifications. 

  

	(i)	In the event that the Representatives advise the SELLER that they have discovered and believe the VESSEL is not being constructed in accordance with this Contract or the
Specifications, and the SELLER shall not agree with the views of the Representatives in such respect, as provided in Clause (e) of this ARTICLE III, either the BUYER or the SELLER shall seek a decision of the Classification Society in
accordance with Clause 1 of ARTICLE XII of this Contract. The Classification Society shall determine whether or not a non-conformity with the provisions of this Contract or the Specifications exists. 

  

	 	(1)	If the Classification Society enters a determination in favour of the BUYER, then in such case the SELLER 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, which shall not be unreasonably withheld, but without prejudice to BUYER’s other rights under this Contract, the Contract Price shall be
fairly and reasonably reduced (as agreed between the Parties hereto and failing which by Arbitration as hereinafter provided) in lieu of such alterations and changes. 

  

	 	(2)	If the Classification Society enters a determination in favour of the SELLER, 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 SELLER for the proven loss and damages incurred by the SELLER as a result of the dispute herein referred to. 

  

 16 

 The SELLER undertakes to inform the Classification Society in writing within thirty (30) days of the date of this
Contract that the SELLER has no objection to the BUYER making an arrangement with the Classification Society for receiving copies of any technical correspondence exchanged between the SELLER and the Classification Society in the course of design,
testing, approval, inspection, survey, supervision, certification and construction of the VESSEL, 
  

	5.	Facilities: 

 The SELLER shall, at no cost to the BUYER, furnish
suitably lighted and air conditioned office space for a team of approximately twelve (12) Representatives all along, including desks, chairs, tables, changing room, toilet and shower space, office furniture, drawing table, filing cabinets,
telephone circuit and use of other communications equipment such as telephone, facsimile, email/internet and such other reasonable facilities as may be required. International and domestic telecommunication service shall be paid by the BUYER at the
normal rate of charges of the Chinese telecommunication company. 
  

	6.	Liability for the Representatives: 

 As between SELLER and BUYER,
the Representatives and their assistants shall at all times be deemed as the employees of BUYER. SELLER shall not be under any liability whatsoever to BUYER, or the Representatives and their assistants for personal injuries, including death,
suffered during the time when they were aboard the VESSEL or within the premises of the SELLER or its subcontractors, to such Representatives and their assistants unless such personal injuries, including death, were caused by gross negligence or
willful misconduct of SELLER or its employees, agents or subcontractors or by employees or agents of such subcontractors. Nor shall SELLER be under any liability whatsoever to BUYER for damage to, or loss or destruction of, property of the
Representatives and their assistants unless such damage, loss or destruction was caused by gross negligence or willful misconduct of SELLER or its employees, agents or subcontractors or by employees or agents of such subcontractors. 
  

	7.	Salaries and Costs: 

 All salaries and other costs of the
Representatives shall be for the BUYER’s account. 
  

	8.	SELLER’s Obligation: 

 Nothing under this ARTICLE IV shall
change or reduce the SELLER’s sole responsibility and obligation to design, build and deliver the VESSEL in a condition fully in accordance with the Contract and its attachments. All respective rights of the BUYER on delivery of the VESSEL
remain fully valid and unprejudiced by this ARTICLE IV. 
  

 17 

	9.	Replacement of the Representatives: 

 The SELLER has the right to
request the BUYER in writing to replace any Representative who is deemed by the SELLER, acting reasonably, unsuitable and unsatisfactory for the proper progress of the VESSEL’S construction together with reasons. The BUYER shall investigate the
situation at the Shipyard, if necessary, and if such SELLER’s request is justified, the BUYER should effect the replacement as soon as conveniently arrangeable. 
  

	10.	Responsibility of BUYER: 

 The Representatives and their
assistant(s) shall observe the work rules and regulations prevailing at the SELLER’s and its subcontractors’ and suppliers’ premises. 
  

	11.	Information to Representatives: 

 The SELLER shall reasonably
promptly provide all required information to the Representatives and their assistant(s) and shall secure that its subcontractors and suppliers shall reasonably promptly provide all such information as he or they may reasonably request in connection
with the construction of the VESSEL. 
 (end of Article) 
  

 18 

 ARTICLE V — MODIFICATIONS, CHANGES AND EXTRAS 
  

	1.	How Effected: 

 Any modifications and/or changes in the
Specifications under which the VESSEL is to be constructed shall be made by written agreement of the parties hereto provided, however, that any modifications and/or changes will not adversely affect the SELLER’s planning or programme in
relation to the SELLER’s other commitments and if the BUYER and SELLER shall agree to adjustment of the Contract Price, time for delivery of the VESSEL and other terms and conditions of this Contract as hereinafter provided. The SELLER hereby
agrees to exert its best efforts to accommodate such reasonable request by the BUYER so that the said changes and/or modifications may be made at a reasonable cost and within the shortest period of time which is reasonably possible. Any such
agreement for modifications and/or changes shall include an agreement as to the increase or decrease, if any, in the Contract Price of the VESSEL and if necessary which instalment is to reflect the increase or decrease of the Contract Price together
with an agreement as to any extension or reduction in the time of delivery, or any other alterations in this Contract, or the Specifications or the Approved Drawings occasioned by such modifications and/or changes. 
 If after the exertion of such best efforts by the SELLER in response to the BUYER’s reasonable request, the parties fail to conclude the above-mentioned agreement,
then the SELLER shall have no obligation to comply with the BUYER’s request. 
 The aforementioned agreement to modify and/or change the Specifications
and/or Approved Drawings may be effected by an exchange of letters signed by the authorized Representatives of the parties hereto, or telex or facsimile confirmed in writing, manifesting such agreement. Such letters and confirmed telex and facsimile
exchanged by the parties hereto pursuant to the foregoing shall constitute an amendment of the Specifications, and such letters and telex and facsimile shall be incorporated into this Contract and made a part hereof. 
 The SELLER may make minor changes to the Specifications, if found necessary for introduction of improved production methods or otherwise, provided that the SELLER shall
first obtain the BUYER’s written approval which shall not be unreasonably withheld. 
  

	2.	Changes in Rules of Classification Society, Regulations, etc.: 

 In
the event that, after the date of signing this Contract, any requirements as to class, or as to rules and regulations to which the construction of the VESSEL is required to conform are altered or changed by the Classification Society or the other
regulatory bodies authorized to make such alterations or changes, the following provisions shall apply: 
  

	(a)	If such alterations or changes are compulsory for the VESSEL, either of the parties hereto, upon receipt of such information from the Classification Society or such other regulatory
bodies, shall promptly transmit the same to the other in writing, and the SELLER shall thereupon incorporate such alterations or changes into the construction of the VESSEL, provided that the BUYER shall first agree to reasonable adjustments
required by the SELLER in the Contract Price, the Delivery Date and other terms and 20 conditions of this Contract and the Specifications occasioned by or resulting from such alterations or changes. 

  

 19 

	(b)	If such alterations or changes are not compulsory for the VESSEL, but the BUYER desires to incorporate such alterations or changes into the construction of the VESSEL, then the
BUYER shall notify the SELLER of such intention. The SELLER shall accept such alterations or changes, provided that such alterations or changes will not, in the judgment of the SELLER, adversely affect the SELLER’s planning or program in
relation to the SELLER’s other commitments, and provided, further, that the BUYER shall first agree to reasonable adjustments required by the SELLER in the Contract Price, the Delivery Date and other terms and conditions of this Contract and
the Specifications occasioned by or resulting from such alterations or changes. Agreements as to such alterations or changes under this Clause 2(b) shall be made in the same manner as provided in Clause 1 of this ARTICLE V for modifications or
changes to the Specifications. If after the exertion of such best efforts by the SELLER in response to the BUYER’s reasonable request, the parties fail to conclude the above-mentioned agreement, then the SELLER shall have no obligation to
comply with the BUYER’s request. 

  

	3.	Substitution of Materials: 

 In the event that any of the materials
and equipment more specifically described in the definition of VESSEL and required by the Specifications or otherwise under this Contract for the construction of the VESSEL can not be procured in time to effect delivery of the VESSEL, or are in
short supply to maintain the delivery date of the VESSEL, the SELLER may, provided the BUYER so agrees in writing, supply other materials and equipment of the available and equal or better quality, meeting the requirements of the Classification
Society and of the rules, regulations, requirements and recommendations with which the construction of the VESSEL must comply. Any agreement as to such substitution of materials and equipment shall be effected in the manner as provided in Clause 1
of this ARTICLE V, and shall, likewise, be in accordance with the terms and conditions of this Contract affected by such substitution. 
 (end of Article)

  

 20 

 ARTICLE VI — TRIALS AND ACCEPTANCE 
  

	1.	Notice: 

 The sea trial shall start when the VESSEL is ready for the
sea trial according to the Specifications. 
 The SELLER shall give the BUYER at least twenty-one (21) days estimated prior notice and Five
(5) days confirming prior notice by facsimile confirmed in writing of the time and place of any trial run of the VESSEL, and the BUYER shall promptly acknowledge receipt of such notice. The BUYER shall have its Representatives on board the
VESSEL to witness such trial run. 
 Should such Representatives fail to be present after the SELLER’s due notice to the BUYER as provided above, then
in such event, the BUYER shall be deemed to have waived its right to have its Representatives on board the VESSEL during the trial run and the SELLER shall be entitled to conduct such trial run with the presence of the Classification Surveyor only
without the Representatives of the BUYER being present and in such case the BUYER shall be obligated to accept the VESSEL on the basis of a certificate of the Classification Society and certificate of the SELLER stating that the VESSEL, upon trial
run, is found to conform to this Contract and Specifications. 
  

	2.	Weather Condition: 

 The trial run shall be carried out under the
weather condition which is deemed favorable enough in the reasonable judgment of the SELLER. In the event of unfavourable weather on the date specified for the trial run, the same shall take place on the first available day thereafter that the
weather condition permits. It is agreed that, if during the speed trial of the VESSEL, the weather is unfavourable (i.e. sea state of 3 and wind state of Beaufort 3 or worse) that orderly conduct of the speed trial can no longer be continued, the
speed trial shall be discontinued and postponed until the first favorable day next following, unless the BUYER shall assent in writing to acceptance of the VESSEL on the basis of the speed trial already made before such discontinuance has occurred.

 Any delay of the trial run caused by such unfavourable weather condition shall operate to postpone the Delivery Date by the period of the delay involved
and such delay shall be deemed as Permissible Delay in the delivery of the VESSEL. 
  

	3.	How Conducted: 

  

	(a)	The VESSEL shall run the official sea trial in the manner as specified in the Specifications and shall prove fulfillment of the performance requirements for the trial run as set
forth in the Specification. 

  

	(b)	All expenses in connection with the trial run (including bunkers, diesel oil, lubricating oil and greases) including proper insurance are to be for account of the SELLER and the
SELLER shall provide, at its own expense, the necessary crew to comply with conditions of safe navigation. 

  

 21 

	4.	Method of Acceptance or Rejection: 

  

	(a)	Upon completion of the trial run, the SELLER shall give the BUYER a notice by telex or facsimile confirmed in writing of completion of the trial run and promptly provide the BUYER
with all protocols and records of tests and trials, as and if the SELLER considers that the results of the trial run prove conformity of the VESSEL to this Contract and Specifications. 

 The BUYER shall, within six (6) working days after receipt of the aforementioned records of tests and trials from the SELLER, notify the SELLER by
telex or facsimile confirmed in writing of its acceptance or rejection of the VESSEL’s conformity to this Contract and the Specifications. 
  

	(b)	Should the records of tests and trials indicate that the VESSEL does not conform to the requirements of this Contract or the Specifications and if the SELLER agrees with the
BUYER’s notice of non-conformity, then the SELLER shall promptly take the necessary steps to correct such non-conformity and notify the BUYER promptly in writing or by telex or facsimile confirmed in writing advising the BUYER of the estimated
additional time required for the necessary alterations to correct such non-conformity. 

 Upon completion of correction of such
non-conformity, new trial run or runs as necessary will be made to prove conformity of the VESSEL to this Contract and Specifications if so found necessary by the SELLER, the Classification Society and the Representatives. The SELLER shall notify
the BUYER of the time and place of any new trial run no less than five (5) working days beforehand, unless otherwise mutually agreed to. All provisions of the trial run shall apply to such new trial run. 
 Notwithstanding the aforesaid, the BUYER may accept the VESSEL qualifying its acceptance by reservations regarding works or parts which have not been
completed or properly installed prior to such acceptance. In the event that BUYER makes such qualified acceptance the parties will reach an agreement in writing, prior to the delivery of the VESSEL, as to how and when to remedy the items being the
subject of the qualified acceptance, at the SELLER’s cost and expense, either before or after the delivery, as quickly as possible, without delaying the date of delivery and without causing the BUYER inconvenience in the operation of the
VESSEL. 
  

	(c)	In the event that the SELLER fails to correct any non-conformity of which it has been given notice by the BUYER, which non-conformity has been confirmed by the Classification
Society, the BUYER shall indicate what aspect of the VESSEL does not conform to this Contract and/or the Specifications and the SELLER shall promptly correct those non-conformities. 

  

	(d)	In the event that the BUYER fails to give notice to the SELLER by fax and/or telex confirmed in writing of the VESSEL within the period as provided in the above Sub-clause
(a) or (b), the BUYER shall be deemed to have accepted the VESSEL. 

  

 22 

	(e)	Any dispute between the SELLER and the BUYER as to the conformity or non-conformity of the VESSEL to the requirements of this Contract and/or the Specifications shall be submitted
for final decision in accordance with ARTICLE XII hereof. 

  

	5.	Effect of Acceptance: 

 Acceptance of the VESSEL as above provided
shall be final and binding in so far as conformity of the VESSEL to this Contract and Specifications is concerned and shall preclude the BUYER from refusing formal delivery of the VESSEL as hereinafter provided, if the SELLER complies with all other
requirements for delivery as provided in ARTICLE VII hereof. However, the BUYER’s acceptance, of the VESSEL shall not affect the BUYER’s right under ARTICLE IX hereof and/or under law. 
  

	6.	Disposition of Surplus Consumable Stores: 

  

	(a)	Any fuel oil, lubricating oil and greases furnished and paid for by the SELLER for trial runs remaining on the VESSEL, at the time of acceptance of the VESSEL by the BUYER, shall be
bought by the BUYER from the SELLER at the SELLER’s net purchase price for such supply in China and the payment by the BUYER thereof shall be made at the time of delivery of the VESSEL. 

  

	(b)	If any of the consumables under (a) above are furnished by the BUYER, SELLER shall pay at time of delivery for quantities consumed until delivery at BUYER’s net purchase
price. 

 (end of Article) 
  

 23 

 ARTICLE VII — DELIVERY 
  

	1.	Time and Place: 

 The VESSEL, duly completed in accordance with this
Contract and the Specifications, shall be delivered by the SELLER to the BUYER at the SELLER’s wharf at the Shipyard safely afloat on or before August 10, 2009 (hereinafter called the “Delivery Date”) after completion of
satisfactory tests and trials and acceptance in accordance with ARTICLE VI hereof, except that, in the event of delays in the construction of the VESSEL or any performance required under this Contract due to causes which under the terms of this
Contract permit postponement of the date for delivery, the aforementioned Delivery Date of the VESSEL shall be postponed accordingly. 
 Earlier Delivery
Date is subject to BUYER’s prior written consent, such consent not to be unreasonably withheld. 
  

	2.	When and How Effected: 

 Provided that the SELLER and the BUYER
shall have fulfilled all of their obligations stipulated under this Contract, the delivery of the VESSEL shall be effected forthwith upon acceptance thereof by the BUYER, by concurrent delivery by each of the parties hereto to the other of the
PROTOCOL OF DELIVERY AND ACCEPTANCE, acknowledging delivery of the VESSEL by the SELLER and acceptance thereof by the BUYER, which Protocol of Delivery and Acceptance shall be prepared in quadruplicate and signed by each of the parties hereto with
additional copies as required by the BUYER or the SELLER. 
  

	3.	Documents to be delivered to BUYER: 

 Acceptance of the VESSEL by
the BUYER shall be conditional upon receipt by the BUYER from the SELLER of the following duly authenticated documents (all in the English language), which shall accompany the aforementioned PROTOCOL OF DELIVERY AND ACCEPTANCE: 
  

	(a)	PROTOCOL OF TRIALS of the VESSEL made pursuant to the Specifications. 

  

	(b)	PROTOCOL OF INVENTORY of the equipment of the VESSEL, including spare parts and the like, as specified in the Specifications. 

  

	(c)	PROTOCOL OF STORES OF CONSUMABLE NATURE covering items referred to under Clause 6 of ARTICLE VI hereof. 

  

	(d)	ALL CERTIFICATES required to be furnished upon delivery of the VESSEL pursuant to this Contract and the Specifications and for the customary shipbuilding practice.

 It is agreed that if, through no fault on the part of the SELLER, the Classifications certificates and/or other certificates
are not available at the time of delivery of the VESSEL, provisional certificates valid for at least five (5) months shall be accepted by the BUYER, provided that the SELLER shall furnish the BUYER with the formal certificates as promptly as
possible after such certificates have been issued, but in any event timely before the expiry of the provisional certificates. 
  

 24 

 All certificates to be delivered to the BUYER hereunder pursuant hereto shall be issued by the relevant
authorities or Classification Society and shall be clean and valid in every respect and without any recommendation or notation. 
  

	(e)	DECLARATION OF WARRANTY of the SELLER that the VESSEL is delivered to the BUYER free and clear of any liens, charges, 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 Chinese governmental authorities whether national or local as well as of all liabilities of the SELLER to
its subcontractors, suppliers, employees and crew(s), and of all the liabilities arising from the operation of the VESSEL in trial runs, or otherwise, prior to delivery. 

  

	(f)	DRAWINGS AND PLANS in quadruplicate pertaining to the VESSEL, including lists of Finished Plans and As Built Space and the trim and stability booklet technical descriptions, test
results and other data, information or documents in the possession of the SELLER concerning the design and constructions of the VESSEL which shall be forwarded to the BUYER at no additional cost as stipulated in the Specification.

  

	(g)	COMMERCIAL INVOICE 

  

	(h)	BILL OF SALE 

  

	(i)	BUILDER’s CERTIFICATE. If required by the BUYER, the SELLER shall arrange for the notarization of the BUILDER’s CERTIFICATE by the local authorized notary public
institution in China, or for the BUILDER’s CERTIFICATE to be otherwise authenticated as required by the Hong Kong Shipping Registry. 

  

	4.	Tender of VESSEL: 

 If the BUYER fails to take delivery of the
VESSEL after completion thereof according to this Contract and Specifications without any justifiable reason, the SELLER shall have the right to tender delivery of the VESSEL after fulfillment of all SELLER’s obligations as provided herein.

  

	5.	Title and Risk: 

 Title to and risk of loss of or damage to the
VESSEL shall pass to the BUYER only upon the delivery and acceptance thereof having been completed as stated above; it being expressly understood that, until such delivery is effected, title to and risk of loss of or damage to the VESSEL and her
equipment and risk of items and materials supplied by the BUYER or its suppliers shall be with the SELLER. 
 Notwithstanding the provisions of this ARTICLE
VII, the title to the material and equipment supplied by the BUYER shall remain with the BUYER. 
  

 25 

	6.	Removal of VESSEL: 

 The BUYER shall take possession of the VESSEL
immediately upon delivery and acceptance thereof and shall remove the VESSEL from the premises of the Shipyard within ten (10) days after delivery and acceptance thereof is effected. 
 If the BUYER shall not remove the VESSEL from the premises of the Shipyard within the aforesaid ten (10) days, in such event, the BUYER shall pay to the SELLER the
reasonable mooring charges of the VESSEL. 
  

	7.	Notices: 

 Prior to the delivery of the VESSEL, the SELLER shall
give notice to the BUYER with the following schedule: 
 90 DAYS PRIOR TO DELIVERY — 15 DAYS ESTIMATED DELIVERY DATE; 
 60 DAYS PRIOR TO DELIVERY — 10 DAYS ESTIMATED DELIVERY DATE; 
 30 DAYS
PRIOR TO DELIVERY — 7 DAYS ESTIMATED DELIVERY DATE; 
 15 DAYS PRIOR TO DELIVERY — 1 DAY DEFINITE DELIVERY DATE 
 (end of Article) 
  

 26 

 ARTICLE VIII — DELAYS AND EXTENSION OF TIME FOR DELIVERY (FORCE MAJEURE) 
  

	1.	Causes of Delay (Force Majeure): 

 If at any time before the actual
delivery, the construction of the VESSEL, any performance required as a prerequisite of delivery of the VESSEL or actual delivery of the VESSEL is delayed due to acts of princes or rulers; compulsory requirements of government authorities; war,
blockade, revolution, insurrections, mobilization, civil war or commotion; vandalism; sabotages, strikes in the shipbuilding industry in China, riots, strikes, lockouts or other labor disturbances; acts of a public enemy, plague or other epidemic,
quarantines; flood, typhoon, hurricanes, earthquakes; tidal waves; landslides; fires, explosions; embargoes; import restrictions; prolonged failure of electric current; delays caused by the Classification Society or other bodies whose documents are
required; destruction of the Shipyard; other causes or accidents beyond the reasonable control of the SELLER; provided all the foregoing events where not existing and known to the SELLER at the date of this Contract or the effect of which could not
have been avoided or reduced by the exercise of due diligence by the SELLER or his relevant subcontractors, as the case may be, and provided further that the events and/or delays were not caused or contributed by the negligence or misconduct of the
SELLER and provided further that any of the above events directly affect the construction schedule of the VESSEL; then and in any such case, the date of delivery shall be postponed for a period of one day for every one day actually lost by any of
the aforesaid events, subject nevertheless to the BUYER’s right of cancellation under this ARTICLE VIII and subject to all relevant provisions of this Contract which authorize and permit extension of the time of delivery of the VESSEL.

 The SELLER shall take immediate steps to overcome and mitigate the delay and to recover time lost, if any. Delays resulting from contingencies occurring
simultaneously shall count as one delay only. 
 Any cause of delay for which the SELLER claims that it is entitled to a postponement of the Delivery Date
under this Contract resulting from the SELLER’s subcontractors shall be subject to any of the aforementioned contingencies being applicable to the subcontractors. 
  

	2.	Notice of Delay: 

 As soon as possible after and in any event within
seven (7) days after the date of the commencement of any cause of delay, on account of which the SELLER claims that it is entitled under this Contract to a postponement of the Delivery Date excluding days due to arbitration, the SELLER shall
notify the BUYER in writing or by telex or facsimile confirmed in writing of the date when such cause of delay commenced and the reasons thereof, and the estimated duration of the probable delay in delivery of the VESSEL, and shall provide the
BUYER, if available, evidence to justify the delay claimed. Likewise, within seven (7) days after the date of ending of such cause of delay, the SELLER shall notify the BUYER in writing or by telex or facsimile confirmed in writing of the date
when such cause of delay ended. 
 In any event the SELLER shall also notify the BUYER of the period of time by which the SELLER claims the Delivery Date
should be postponed by reason of such cause of delay within the same seven (7) day period as aforesaid. Failure of the SELLER to notify the BUYER of its claim for postponement of the Delivery Date within a period of seven (7) days from the
date of cessation of the event causing the delay shall be deemed a waiver of its claim. 
  

 27 

 Failure of the BUYER to object to the SELLER’s claim for postponement of the Delivery Date within Fourteen
(14) days after receipt by the BUYER of such notice of claim shall be deemed to be a waiver by the BUYER of its right to object to such postponement of the Delivery Date. 
 The burden of proof shall always be on the SELLER to establish the facts entitling it to rely on this Clause and that due notices were given and that it has taken all reasonable steps to avoid or mitigate the delay.

  

	3.	Definition of Permissible Delay: 

 Delays on account of such causes
as specified in Clause 1 of this ARTICLE VIII and in ARTICLE IV, Clause 4(i)(2)), ARTICLE V, ARTICLE VI, ARTICLE XI, ARTICLE XII, ARTICLE XVII and ARTICLE XVI shall be understood to be Permissible Delays and are to be distinguished from unauthorized
delays on account of which the Contract Price is subject to adjustment and/or the Contract is subject to rescission as provided for respectively in Article III and Article X hereof. 
  

	4.	Right to Rescind for Excessive Delay: 

 If the total accumulated
time of all delays on account of the causes specified in Clause 1 of this ARTICLE VIII and unauthorized delays as described in the Clause 1 of ARTICLE III aggregate to 180 days or more, in any circumstances, then, in such event, the BUYER may
rescind this Contract by delivering or faxing to the SELLER notice of cancellation which shall be confirmed in writing and in accordance with the provisions of ARTICLE X hereof. 
 The SELLER may, at any time after the accumulated time of the aforementioned delays justifying the rescission by the BUYER, demand in writing that the BUYER shall make an election, in which case the BUYER shall,
within twenty one (21) days after such demand is received by the BUYER, either notify the SELLER of its intention to rescind this Contract, or consent to a postponement of the Delivery Date to an agreed specific future date. If the BUYER elects
to consent to the postponement of the Delivery Date at such agreed specific future date, then such date shall become the contractual delivery date, for the purpose of this Contract and if the VESSEL is not delivered by such revised delivery date,
the BUYER shall have the same right of rescission upon the same terms as herein provided. 
 (end of Article) 
  

 28 

 ARTICLE IX — WARRANTY OF QUALITY 
  

	1.	Guarantee: 

 The SELLER guarantees the VESSEL in her entirety and
each and every part thereof and in particular but without prejudice to the generality of the foregoing, her design, drawing, plans, the hull and all machinery, engines, engine room auxiliaries, equipment, fittings, outfittings, appurtenances,
furniture, parts, spares, paint and materials manufactured, furnished, installed or incorporated in the VESSEL by the SELLER and/or its subcontractors under this Contract against all defects, omissions, shortages and non-conformity, defective or
unsuitable materials or equipment, faulty design and/or performance or poor workmanship or negligence, (hereinafter collectively referred to as “Defect(s)”), whether or not such Defect(s) affect seaworthiness or class within the
Guarantee Period as hereinafter defined. 
 The SELLER shall pass to the BUYER information about any claims that the SELLER may have against subcontractors
for Defect(s) in deliveries to the VESSEL, without in any way, diminishing the SELLER’s guarantee as aforesaid. 
  

	2.	Guarantee from Manufacturers and Suppliers: 

 In the event that the
normal guarantee period stipulated by manufacturers or suppliers or various components of machinery, materials, equipment, paint, appurtenances and outfit furnished to the SELLER and embodied in the VESSEL exceeds the Guarantee Period (as
hereinafter defined), the benefits of such extended guarantee rights shall be made available to the BUYER by the SELLER without any additional cost to the BUYER. 
 Notwithstanding the foregoing, the SELLER shall arrange a guarantee from the paint manufacturer for defects in paint and/or application on under water parts of the VESSEL for an additional 24 calendar months from the date of delivery of the
VESSEL to the BUYER. 
  

	3.	Notice of Defects: 

 The BUYER or its duly authorized
Representatives shall notify the SELLER in writing by delivery or facsimile of any Defect for which claim is made under this guarantee, as promptly as possible after discovery thereof. The BUYER’s written notice shall describe in reasonable
detail the nature and extent of the Defect(s). 
 The SELLER shall have no obligation for any Defect discovered prior to the expiry date of the Guarantee
Period unless notice of such Defect is received by the SELLER not later than thirty (30) days after such expiry date. Telex or facsimile advice within the Guarantee Period that a claim is forthcoming will be sufficient compliance with the
requirement as to time, provided that full description of such Defect(s) in written form shall be received by the SELLER not later than forty-five 45 days after the Guarantee Period. 
  

	4.	Extent of SELLER’s Obligation: 

 The SELLER shall have no
obligation for any Defect unless the Defect has arisen within a period of twelve (12) calendar months from the date when the VESSEL was delivered to and accepted by the BUYER (the “Guarantee Period”). 
  

 29 

 The SELLER shall not be obligated to repair or be liable for damages to the VESSEL, or to any part of the equipment
thereof, if and to the extent the damages are due to: 
  

	(a)	ordinary wear and tear; 

  

	(b)	defects other than those specified in Clause 1 above; 

  

	(c)	mismanagement, accidents, negligence, or willful misconduct of or caused by the BUYER, its employees or agents including the VESSEL’s officers, crew and passengers, or any
persons on or doing work on the VESSEL other than the SELLER, its employees, agents or sub-contractors; 

  

	(d)	repairs or replacements which were made by those other than the SELLER and/or their sub-contractors, unless those repairs or replacements were approved by the SELLER.

 The SELLER shall not, in any circumstances, be liable for any consequential loss or special loss arising from any cause whatsoever
including, without limitation, loss of time, loss of profit or earnings or demurrage directly or indirectly from any commitments of the BUYER in connection with the VESSEL. 
 The guarantee in this ARTICLE IX shall not be altered or varied except by a written instrument signed by the duly authorized representatives of the SELLER and the BUYER. 
  

	5.	Remedy of Defects: 

  

	(a)	The SELLER shall remedy, at its cost and expense, any Defect(s) against which the VESSEL is guaranteed under this ARTICLE IX, by making all necessary repairs or replacements as well
as dismantling, removal, reassembling and incidental works at the Shipyard or elsewhere as provided in Clause (b) of this Clause, at the BUYER’s convenience. 

 If the cause of the Defect(s) is not known or if the Defect(s) is of a recurring nature the SELLER shall, at its expense, explore the reason for such
Defect(s) and take all necessary steps and measures to remedy same in such a way as to eliminate the reoccurrence thereof. 
  

	(b)	 However, if, in the BUYER’s sole discretion, it is impracticable to bring the VESSEL to the Shipyard, the BUYER may cause the necessary repairs or replacements
to be made elsewhere which is deemed suitable by the BUYER for the purpose (including by the VESSEL’s crew), provided that, in such event, the SELLER may forward or supply replacement parts or materials to the VESSEL, unless forwarding or
supplying to the VESSEL 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 for the VESSEL to be made at any other shipyard or works than the
Shipyard, the BUYER shall first, but in all events as soon as possible, give the SELLER notice in writing by telex or facsimile confirmed in writing of the time and place when and where such repairs will be made, and if the VESSEL is not thereby
delayed, or her operation or working schedule is 

  

 30 

	 	 
not thereby impaired, the SELLER shall have the right at its own cost and expense to verify by its own representatives the nature, cause and extent of the
Defect(s) complained of. It is understood that defects to underwater parts of the VESSEL, which were found and detected during the Guarantee Period, may be made good at the time of the first dry-docking of the VESSEL following the expiration of the
Guarantee Period. 

 The SELLER shall, in such case, promptly advise the BUYER by telex or facsimile confirmed in writing,
after such examination has been completed, of its acceptance or rejection of the Defect(s) as ones that are covered by the guarantee herein provided. Upon the SELLER’s acceptance of the Defect(s) as justifying remedy under this ARTICLE IX, or
upon award of the arbitration so determining, the SELLER shall pay to the BUYER for such repairs or replacements a sum equal to the reasonable cost of making the same repairs or replacements in a first class Chinese shipyard, at the prices
prevailing at the time of such repairs or replacements are made. Payment for the work done to remedy the Defect(s) shall be settled regularly during the Guarantee Period and the actual reimbursement for the guarantee shall be made in a lump sum at
the expiry of the Guarantee Period for minor items (up to US$50,000) and promptly by the SELLER after settlement of the same for major items. 
  

	(c)	In any case, the VESSEL shall be taken, at the BUYER’s cost and responsibility, to the place elected, ready in all respects for such repairs or replacement. In case of
breakdown at sea due to Defects, the cost of bringing the VESSEL to a repair yard shall be for SELLER’s account. 

  

	(d)	Notwithstanding anything contained in Clause 5(a) of this ARTICLE IX, the BUYER shall be entitled to require the SELLER to forward to the VESSEL, wherever it may be, replacement(s)
for defective part(s) to which the SELLER’s guarantee under this ARTICLE IX applies, and in such case the SELLER shall forward the same by such means as to reach the VESSEL as expeditiously as possible. 

 In emergency cases when the VESSEL will be prevented from sailing or from completing its voyage, forwarding of replacement(s) as aforesaid will be
effected by the SELLER by air cargo. The SELLER shall bear and pay all C.I.F. costs of the replacement(s) until they arrive on board the VESSEL. 
  

	(e)	Any dispute under this ARTICLE IX shall be referred to arbitration in accordance with the provisions of ARTICLE XII hereof. 

  

	6.	Guarantee Period: 

 Notwithstanding the foregoing, the Guarantee
Period shall be extended in, inter alia, the following cases and to the following extent: 
  

	(a)	If, during the Guarantee Period, the VESSEL shall not be capable of performing services for periods consisting of at least twenty four (24) hours each and aggregating to eight
(8) days or more and such non-capability shall be as a result of any Defect(s) covered by the SELLER’s guarantee under Clause 1 of this ARTICLE IX, the Guarantee Period shall be extended by such period(s) of time lost in remedying of the
defect(s) for which the SELLER is responsible according to this Contract or in awaiting part(s) required for the 32 purpose to remedying such defect(s), which accumulated extension period shall not exceed twelve (12) months.

  

 31 

	(b)	In relation to reservations made by the BUYER pursuant to Clause 4(b) of ARTICLE VI hereof, the Guarantee Period for the aforesaid reservations shall further be extended up to the
expiration of twelve (12) calendar months following the time when such reservations are respectively made good by the SELLER after the delivery of the VESSEL to the BUYER as herein provided. 

  

	7.	Application to Defects Remedied: 

 Wherever any Defect(s) covered by
the SELLER’s Guarantee under this ARTICLE IX has been remedied, in whole or in part, the SELLER’s Guarantee under this ARTICLE IX and the provisions of this ARTICLE IX shall apply anew in respect of the part(s) to which such remedying
relates and the aforesaid Guarantee Period shall apply in respect thereof, save that the said Guarantee Period shall commence as from the time of such remedying, and shall end not more than twenty-four (24) months from the date of delivery of
the VESSEL to the BUYER. 
  

	8.	SELLER to Remain Liable: 

 If attempts at remedying any Defect(s)
covered by the SELLER’s Guarantee under this ARTICLE IX, carried out by or on behalf of the SELLER as aforesaid, are unsuccessful, the SELLER shall remain liable to remedy such Defect(s) until same be satisfactorily remedied. The SELLER shall
be liable under its Guarantee under this ARTICLE IX also for damage to any part of the VESSEL occasioned directly by any Defect(s) to which the SELLER’s Guarantee under this ARTICLE IX extends in any other part of the VESSEL. 
  

	9.	Guarantee Engineer: 

 The SELLER shall at the request of the BUYER
appoint an English speaking Guarantee Engineer to serve on the VESSEL as its Representative for a period of three (3) months from the date the VESSEL is delivered. However, if the BUYER and the SELLER shall deem it necessary to keep the
Guarantee Engineer on the VESSEL for a longer period, then he shall remain on board the VESSEL after the said three (3) months but not longer than six (6) months from the delivery of the VESSEL. 
 The BUYER, and its employees shall give such Guarantee Engineer full cooperation in carrying out his duties as the representative of the SELLER on board the VESSEL.

 The BUYER shall accord the Guarantee Engineer treatment comparable to the VESSEL’s Chief Engineer as far as possible, and shall provide board and
lodging at no cost to the SELLER and/or the Guarantee Engineer. The SELLER and the BUYER shall, prior to delivery of the VESSEL, execute a separate agreement regarding the Guarantee Engineer. 
 While the Guarantee Engineer is on board the VESSEL, the BUYER shall pay to the SELLER the sum of US$2,500 per month and the expenses of his repatriation to Shanghai,
People’s Republic of China by air (economy class) upon termination of his service. The expenses of his communication with the SELLER incurred in performing his duties shall be for SELLER’s 
  

 32 

 
account and expenses, if any, of his medical and hospital care in the VESSEL’s hospital shall be for BUYER’s account. Notwithstanding the above,
the Guarantee Engineer shall remain at all times an employee of the SELLER. 
 The BUYER, its successors and/or assigns shall be liable to and indemnify the
SELLER for damage or loss arising from personal injury or death of the Guarantee Engineer or from loss or destruction of the property of the Guarantee Engineer if such death, personal injury or property damage is caused by the negligence or willful
misconduct of the BUYER, its successors or assigns, employees or agents. The BUYER shall be responsible for risk insurance for the Guarantee Engineer. 
 (end of Article) 
  

 33 

 ARTICLE X — SELLER’S DEFAULT — RESCISSION BY BUYER 
  

	1.	SELLER’s Default: 

 The BUYER shall be entitled, but not bound,
to declare the SELLER in default and to rescind this Contract, all as stipulated in this Contract and Specifications, in any of the following cases: 
  

	(a)	any breach of or default by the SELLER in any Fundamental Term. “Fundamental Term” means any of the following: 

 (i) an event described in a provision of this Contract specifically permitting the BUYER to rescind this Contract including and without restricting the
generality of the foregoing, those contained in ARTICLE III (Adjustment of Contract Price) and ARTICLE XVII, Clause 2(b) (Insurance); 
 (ii)
failure of SELLER to prosecute the work with such diligence and in such manner as will enable it to deliver VESSEL within the period granted under the terms of this Contract, provided that the BUYER shall have given the SELLER written notice
specifying such failure, and the SELLER shall not within ten (10) days of such notice, have taken steps sufficient to remedy or justify the failure. 
 (iii) failure to deliver the VESSEL free and clear of all liens, charges, mortgages and encumbrances at the actual time of delivery and possession; 
 (iv) any other failure, not specifically referred to above, to build in accordance with this Contract or the Specifications, provided that the BUYER shall
have given the SELLER written notice specifying such failure, and the SELLER shall not within ten (10) days of such notice, have taken steps sufficient to remedy or justify the failure; or 
  

	(b)	Discontinuance of business by the SELLER, general assignment by the SELLER for the benefit of creditors, any composition by the SELLER with its creditors, appointment of a receiver,
trustee or liquidator for the SELLER of all or any substantial part of its assets, application or consent by the SELLER for or to appointment of the same, winding up by the SELLER, adjudication of the SELLER as bankrupt or insolvent, filing by the
SELLER of a petition for liquidation, a petition in bankruptcy, a petition or answer seeking reorganization or an arrangement with creditors or seeking to take advantage of any law relating to relief of debtors or admission by the SELLER (by answer,
default or otherwise) of the material allegations of petition against it in any proceedings for liquidation, bankruptcy, reorganization, arrangement or insolvency or in any proceedings relating to relief of debtors, excluding mergers,
consolidations, reorganizations or restructurings that are unrelated to bankruptcy, insolvency or other financial distress of the SELLER. 

  

 34 

	2.	Effect of SELLER’s Default: 

 If the SELLER shall be in any
default as provided for in Clause 1 of this ARTICLE X hereinabove, the BUYER may, at its option, rescind this Contract in accordance with provisions of this ARTICLE X. 
  

	3.	Notice: 

 In the event that the BUYER shall exercise its right of
rescission of this Contract under and pursuant to any of the provisions of this Contract specifically permitting the BUYER to do so, then the BUYER shall notify the SELLER in writing or by fax and/or telex confirmed in writing, and such rescission
shall be effective as of the date notice thereof is received by the SELLER. 
  

	4.	Refundment by SELLER: 

 In case the SELLER receives the notice
stipulated in Clause 3 of this ARTICLE X, the SELLER shall promptly refund to the BUYER the full amount of all sums paid by the BUYER to the SELLER on account of the VESSEL together with interest (as set out below) thereon. 
 If the BUYER’s cancellation or rescission of this Contract is disputed by the SELLER by instituting arbitration as aforesaid, then no refund shall be made by the
SELLER, and the BUYER shall not be entitled to demand repayment from the Refundment Guarantor under its Refundment Guarantee, until the arbitration award between the BUYER and the SELLER which shall be in favour of the BUYER, declaring the
BUYER’s cancellation and/or rescission justified, is made and delivered to the SELLER by the arbitration tribunal. 
 In case of refundment, the SELLER
shall pay the BUYER interest at the rate of six percent (6%) per annum on the amount required herein to be refunded to the BUYER, if the cancellation or rescission of the Contract is exercised by the BUYER for the delay of aggregate one hundred
and eighty (180) days in accordance with the provision of Clause 3 of ARTICLE VIII or for the events described in ARTICLE III 1(c), 2(c), 3(c), 4(c), 5(b) or 5(e) hereof computed from the respective dates on which such sums were paid by the
BUYER to the SELLER to the date of receipt (remittance by wire transfer) of such refund by the BUYER from the SELLER. 
 If pursuant to the provisions of
this Contract the SELLER is required to refund to the BUYER the instalments paid by the BUYER to the SELLER, the SELLER shall return to the BUYER all of the BUYER’s supplies not incorporated into the VESSEL and pay to the BUYER an amount equal
to the purchased price by the BUYER of those supplies incorporated into the VESSEL, together with interest as aforesaid, in which case title to such supplies incorporated into the VESSEL shall transfer to the SELLER. 
 Any and all refunds or payments due to the BUYER under this Contract shall be effected by telegraphic transfer to the account and bank specified by the BUYER free of
bank charges, remittance fees, taxes and other applicable withholdings. 
  

 35 

	5.	Discharge of Obligations: 

 Upon such refund by the SELLER to the
BUYER, and upon compliance with the provisions of Clause 4 of this ARTICLE X, all obligations, duties and liabilities of each of the parties hereto to the other under this Contract shall be forthwith completely discharged. 
 (end of Article) 
  

 36 

 ARTICLE XI — DEFAULT BY THE BUYER 
  

	1.	Definition of BUYER’s Default: 

 The BUYER shall be deemed to
be in default of its performance of obligations under this Contract in the following cases (hereinafter called “BUYER’s Default”): 
  

	(a)	If any of the first or second or third or fourth or fifth instalment is not paid by the BUYER to the SELLER as provided in ARTICLE II hereof; or 

  

	(b)	If the delivery instalment is not deposited to the SELLER’s Bank by the BUYER to the SELLER for the delivery of the VESSEL as provided in ARTICLE II hereof; or

  

	(c)	If the increased amount, if any, in the Contract Price as adjusted pursuant to ARTICLE V due and payable upon delivery of the VESSEL is not paid by the BUYER concurrently with the
delivery of the VESSEL as provided in ARTICLE II hereof; or 

  

	(d)	If the BUYER, when the VESSEL is duly completed in conformity with the terms of this Contract and the Specifications and is tendered for delivery by the SELLER in accordance with
the provisions of this Contract, fails to take delivery of the VESSEL within Five (5) days from the tendered date without any specific and valid ground therefor under this Contract. 

  

	2.	Effect of BUYER’s Default on or before Delivery of VESSEL: 

  

	(a)	Should the BUYER make default in payment of any instalment of the Contract Price before delivery of the VESSEL, the BUYER shall pay the instalment(s) in default plus accrued
interest thereon at the rate of six percent (6%) per annum computed from the due date for payment of such instalment to the date when the SELLER receives the payment, and, for the purpose of Clause 1 of ARTICLE VII hereof the Delivery Date of
the VESSEL shall be automatically extended by the period of continuance of such default by the BUYER. 

  

	(b)	If any BUYER’s Default continues for a period of Twenty One (21) days, the SELLER may, at its option, rescind this Contract by giving notice to such effect to the BUYER by
telex or facsimile confirmed in writing. 

 Upon receipt by the BUYER of such notice of rescission, this Contract shall be
forthwith rescinded and terminated. In the event of such rescission of this Contract, the SELLER shall, subject to Clause 3 below, be entitled to retain any instalment or instalments already paid by the BUYER to the SELLER on account of this
Contract and the BUYER’s Supplies, if any. 
  

 37 

	3.	Disposal of VESSEL: 

  

	(a)	In the event that this Contract is rescinded by the SELLER under the provisions of Clause 2(b) of this ARTICLE XI, the SELLER may, at its sole discretion, either complete the VESSEL
and sell the same, or sell the VESSEL in its incomplete state, free of any right or claim of the BUYER. Such sale of the VESSEL by the SELLER shall be either by public auction or private contract at the SELLER’s sole discretion and on such
terms and conditions as the SELLER shall deem fit, provided that the SELLER shall use reasonable endeavors to obtain the best price obtainable. The SELLER shall send to the BUYER invitation to participate in any tender for the sale of the VESSEL.
Such invitation shall be sent by telex or facsimile at least fifteen (15) days in advance before the closing date of the tender. 

  

	(b)	In the event of such sale of the VESSEL in its completed state, the proceeds of the sale received by the SELLER shall be applied firstly to payment of all expenses attending such
sale and then to payment of all unpaid instalment(s) of the Contract Price and interest on such instalment(s) at the rate of six percent (6%) per annum from the respective due date thereof to the date of application. 

 

	(c)	In the event of sale of the VESSEL in its incomplete state, the proceeds of sale received by the SELLER shall be applied firstly to all expenses attending such sale and otherwise
incurred by the SELLER as a result of the BUYER’s default as provided hereinbefore, and then to payment of all costs of construction of the VESSEL less BUYER’s Supplies as defined in ARTICLE XVI hereof and less the instalments so retained
by the SELLER and compensation to the SELLER for a reasonable loss of profit — if any — due to the rescission of this Contract. 

  

	(d)	In either of the above events of sale, if the proceeds of sale exceed the total amounts to which such proceeds are to be applied as aforesaid, the SELLER shall promptly pay the
excess to the BUYER without interest provided, however, that the amount of each payment to the BUYER shall in no event exceed the total amount of instalments already paid by the BUYER and the cost of the BUYER’s supplies, if any.

  

	(e)	If the proceeds of sale are insufficient to pay such total amounts payable as aforesaid, the BUYER shall promptly pay the deficiency to the SELLER upon request.

 (end of Article) 
  

 38 

 ARTICLE XII — ARBITRATION 
  

	1.	Decisions by the Classification Society: 

 If any dispute arises
between the parties hereto in regard to the design and/or construction of the VESSEL, its machinery and equipment, and/or in respect of the materials and/or workmanship thereof and/or thereon, and/or in respect of interpretation of this Contract or
the Specifications, the parties may by mutual agreement refer the dispute to the Classification Society headquarters or to such other expert as may be mutually agreed between the parties hereto, and in such case the decision of the principal
surveyor or such expert, as the case may be, shall be final, conclusive and binding upon the parties hereto. 
  

	2.	Proceedings of Arbitration: 

 In the event that the parties hereto
do not agree to settle a dispute according to Clause 1 of this ARTICLE XII and/or in the event of any other dispute of any kind whatsoever between the parties and relating to, arising out of or in connection with, this Contract or its rescission or
any stipulation herein, such dispute shall be submitted to and settled by arbitration in London, England in accordance with Arbitration Act 1996 c.23 (UK) as amended, and the arbitration shall be conducted in accordance with the London Maritime
Arbitrators Association (LMAA) Terms current at the time when the arbitration proceedings are commenced (except as expressly provided herein). The SELLER and the BUYER shall each independently appoint one arbitrator to arbitrate the matter, and the
SELLER and the BUYER shall together appoint a third arbitrator. In the event that the BUYER and SELLER cannot agree on the appointment of the third arbitrator within twenty (20) days of the appointment of the second arbitrator, the two
appointed arbitrators shall be responsible for appointing the third arbitrator. 
 If the two arbitrators are unable to agree upon a third arbitrator within
twenty (20) days, either of the said two arbitrators may apply to the President for the time being of the London Maritime Arbitrators Association to appoint the third arbitrator, and the three arbitrators shall constitute the board of
arbitration. 
 Such arbitration shall be in accordance with and subject to the provisions of the relevant English Arbitration Act for the time being in
force at the time of the action. Either party may demand arbitration of any such dispute by giving notice to the other party. 
 Any demand for arbitration
by either of the parties hereto shall state the name of the arbitrator appointed by such party and shall also state specifically the question or questions as to which such party is demanding arbitration. Within twenty (20) days after receipt of
notice of such demand for arbitration, the other party shall in turn appoint a second arbitrator and give notice in writing of such appointment to the party demanding arbitration. If a party fails to appoint an arbitrator as aforementioned within
twenty (20) days following receipt of notice of demand for arbitration by the other party, the party failing to appoint an arbitrator shall be deemed to have accepted and appointed, as its own arbitrator, the arbitrator appointed by the party
demanding arbitration and the arbitration shall proceed before this sole arbitrator who alone in all such events shall constitute the Arbitration Board. 
  

 39 

 The award of the sole arbitrator and/or of the majority of the three arbitrators, as the case may be, shall be final and
binding on both parties. If the majority of the three arbitrators is not obtained, then the decision of the third arbitrator shall be final and binding upon the parties hereto. 
  

	3.	Notice of Award: 

 The award shall immediately be given to the BUYER
and the SELLER by telex or facsimile confirmed in writing. 
  

	4.	Expenses: 

 The Arbitration Board shall determine which party shall
bear the expenses of the arbitration or the portion of such expenses which each party shall bear. 
  

	5.	Entry in Court: 

 In case of failure by either party to respect the
award of the arbitration, judgment upon the award may be entered in any court having jurisdiction thereof. 
  

	6.	Alteration of Delivery Date: 

 In the event of reference to
arbitration of any dispute arising out of matters occurring prior to delivery of the VESSEL, the SELLER shall not be entitled to extend the Delivery Date as defined in ARTICLE VII hereof and the BUYER shall not be entitled to postpone its acceptance
of the VESSEL on the Delivery Date or on such newly planned time of delivery of the VESSEL as declared by the SELLER. However, if the construction of the VESSEL is affected by any arbitration or court proceeding, the SELLER shall then be permitted
to extend the Delivery Date as defined in ARTICLE VII and the decision or the award shall include a finding as to what extent the SELLER shall be permitted to extend the Delivery Date. 
 (end of Article) 
  

 40 

 ARTICLE XIII — ASSIGNMENT — SUCCESSOR AND ASSIGNS 
 This Contract with the exception of the right to make demand under the Refund Guarantee may, with the prior approval of the SELLER, which the SELLER shall not
unreasonably withhold, be assigned and transferred by the BUYER to and title be taken by another company. In the event of any assignment pursuant to the terms of this Contract, the assignee, its successors and assigns shall succeed to all of the
rights and obligations of the BUYER hereunder. 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 by the transfer of this Contract shall be for the account of the BUYER. 
 Notwithstanding the above, the
BUYER has the right to assign this Contract with the exception of the right to make demand under the Refund Guarantee to a bank or syndicate of banks or financial institution or any commercial corporation assisting in the finance of the VESSEL prior
to delivery of the VESSEL provided that the BUYER has given the SELLER a notice of assignment in form and content acceptable to the SELLER and the BUYER, acting reasonably. The SELLER shall, at the BUYER’s request, acknowledge and consent to
such assignment by signing an acknowledgement and consent acceptable to the SELLER and the BUYER, acting reasonably. 
 The SELLER 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, provided always that SELLER shall remain responsible for the due and punctual performance of this Contract by the
Assignee. 
 (end of Article) 
  

 41 

 ARTICLE XIV — TAXES AND DUTIES 
  

	1.	Taxes and Duties Incurred in China: 

 The SELLER shall bear and pay
all taxes, duties, stamps and fees incurred in China in connection with execution and/or performance of its obligations under this Contract. 
 The BUYER
shall bear and pay all taxes, duties, stamps and fees incurred in China in connection with execution and/or performance of its obligations under this Contract, including any taxes and duties imposed in China upon the BUYER’s Supplies.

  

	2.	Taxes and Duties Incurred outside China: 

 The BUYER shall bear and
pay all taxes, duties, stamps and fees incurred outside China in connection with execution and/or performance of its obligations under this Contract. 
 The
SELLER shall bear and pay all taxes, duties, stamps and fees incurred outside China in connection with execution and/or performance of its obligations under this Contract, including taxes and duties imposed upon these items to be procured by the
SELLER for the construction of the VESSEL. 
 (end of Article) 
  

 42 

 ARTICLE XV — PATENTS, TRADEMARKS, COPYRIGHTS, ETC. 
  

	1.	Patents, Trademarks and Copyrights: 

 Machinery and equipment of the
VESSEL may bear the patent number, trademarks or trade names of the manufacturers. The SELLER shall defend and hold harmless the BUYER from patent liability or claims for or on account of any patents, copyrights or design or for infringement thereof
of any nature and kind, including costs and expenses for, or on account of any patented or patentable invention made or used in the performance of this Contract and also including costs and expenses of litigation, if any, in connection therewith.

 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. 
 The SELLER’s warranty hereunder does not extend to the BUYER’s
Supplies. 
 The SELLER’s obligation under this ARTICLE XV shall not be terminated by the passage of any period of time. 
  

	2.	General Plans, Specifications and Working Drawings: 

 The SELLER
retains copyright with respect to the Specifications, and 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 therefore not to disclose the same or divulge any information contained therein to any third parties, without the prior written consent of the SELLER, except where it is necessary for usual operation, repair and maintenance of the VESSEL
and its financing. 
 (end of Article) 
  

 43 

 ARTICLE XVI — BUYER’S SUPPLIES 
  

	1.	Responsibility of BUYER: 

  

	(a)	The BUYER shall, at its own risk, cost and expense, supply and deliver to the SELLER all of the items to be furnished by the BUYER as specified in the Specifications (herein called
the “BUYER’s Supplies”) at a warehouse or other storage facility of the Shipyard in the proper condition ready for installation in or on the VESSEL, in accordance with the time schedule designated and advised to the BUYER by
the SELLER. 

  

	(b)	In order to facilitate installation by the SELLER of the BUYER’s Supplies in or on the VESSEL, the BUYER shall furnish the SELLER with necessary specifications, plans,
drawings, instruction books, manuals, test reports and certificates required by the rules and regulations of the Specifications. If so requested by the SELLER, the BUYER shall, without any charge to the SELLER, cause the representatives of the
manufacturers of the BUYER’s Supplies to assist the SELLER in installation thereof in or on the VESSEL and/or to carry out installation thereof by themselves or to make necessary adjustments at the Shipyard. 

  

	(c)	Any and all of the BUYER’s Supplies shall be subject to the SELLER’s reasonable right of rejection, as and if they are found to be unsuitable or in improper condition for
installation. However, if so requested by the BUYER, the SELLER may repair or adjust the BUYER’s Supplies without prejudice to the SELLER’s other rights hereunder and without being responsible for any consequences arising therefrom.

  

	(d)	Should the BUYER fail to deliver any of the BUYER’s Supplies within the time designated by one (1) month prior notice to the BUYER by the SELLER, the Delivery Date shall
be extended for a period which actually caused the delay in the delivery of the VESSEL. 

  

	(e)	If delay in delivery of any of the BUYER’s Supplies exceeds twenty (20) days, then the SELLER shall be entitled to proceed with construction of the VESSEL without
installation thereof in or on the VESSEL as hereinabove provided, and the BUYER shall accept and take delivery of the VESSEL so constructed, unless such delay is caused by any of the events referred to in ARTICLE VIII in which case the provision of
Clause 1(d) of this ARTICLE XVI shall apply. 

  

	(f)	The SELLER shall not be liable under ARTICLE IX for any defects in the BUYER’s Supplies (if any) but the SELLER shall be liable under ARTICLE IX for any Defect(s) in respect of
installation of the BUYER’s Supplies and their adaptation to the VESSEL. 

  

	2.	Responsibility of SELLER: 

 The SELLER shall be responsible for
storing, safekeeping and handling with reasonable care of the BUYER’s Supplies after delivery thereof at the Shipyard, and shall, at its own cost and expense, install them in or on the VESSEL, unless otherwise provided herein or agreed by the
parties hereto, provided, always, that the SELLER shall not be responsible for quality, efficiency and/or performance of any of the BUYER’s Supplies. 
  

 44 

 However, if any BUYER’s Supplies are lost or damaged after acceptance by the SELLER without rejection while in the
custody of the SELLER, the SELLER shall be responsible for such loss or damage and shall either replace the items or reimburse the BUYER accordingly. The SELLER shall further be responsible for wrongful or negligent installation of the BUYER’s
Supplies in the course of their installation by the SELLER. 
 (end of Article) 
  

 45 

 ARTICLE XVII — INSURANCE 
  

	1.	Extent of Insurance Coverage: 

 From the time of keel laying until
delivery of the VESSEL, the SELLER shall, at its own cost and expense, insure the VESSEL and all machinery and equipment, appurtenances and outfits delivered to the Shipyard or other building facility utilized by the SELLER, including the
BUYER’s Supplies when at a warehouse or other storage facility of the SELLER or built into or installed in or upon the VESSEL, against all risks under the Builder’s Risks Insurance Clause on terms and conditions not less than the current
British Institute Time Clauses and British War Clauses Builder’s Risks, with first class insurance company or underwriters in China recognized in the international insurance market. The amount of such insurance coverage shall not be less than
the aggregate amount of all instalments paid by the BUYER to the SELLER. The policy referred to hereinabove shall be taken out in the name of the SELLER and all losses under such policy shall be payable to the SELLER. 
  

	2.	Application of the Recovered Amounts: 

 In the event that the VESSEL
shall be damaged from any cause at any time before delivery of the VESSEL, and in the further event that such damage shall not constitute an actual or constructive total loss of the VESSEL, the amount received from insurance in respect of the VESSEL
shall be applied by the SELLER in repair of such damage, satisfactory to the Classification Society requirements and in conformity with the terms of this Contract and the Specifications, and the BUYER shall accept the VESSEL under this Contract if
completed in accordance with this Contract and the Specifications and so certified by the Classification Surveyor. 
 Should the VESSEL from any cause become
an actual or constructive total loss: 
  

	(a)	the SELLER and the BUYER may mutually agree to build another VESSEL in place of the VESSEL so lost or reconstruct the VESSEL’s damage and proceed in accordance with the terms
of this Contract, in which case the amount received from insurance in respect of the VESSEL shall be applied to the construction of a new VESSEL or reconstruction of the VESSEL, provided the parties hereto shall have first agreed thereto in writing
and to such reasonable extension of delivery time as may be necessary for the completion of such construction or reconstruction. 

 If the parties fail to reach agreement pursuant to Clause 2(a) above within forty-five (45) days after the VESSEL is determined to be an actual or constructive total loss, the provisions of Clause 2(b) shall apply. 
  

	(b)	The SELLER shall refund promptly to the BUYER the full amount of all sums paid by the BUYER to the SELLER as instalments in advance of delivery of the VESSEL together with interest
thereon at the rate of six percent (6%) per annum, and promptly deliver to the BUYER all BUYER’s Supplies (or the insurance proceeds paid with respect thereto), in which case this Contract shall be deemed to be automatically rescinded and
all rights, duties, liabilities and obligations of each of the parties to the other shall forthwith cease and terminate. 

  

 46 

 If the SELLER fails to refund within fifteen (15) Banking Days, the full amount of all sums required
to be paid by the SELLER to the BUYER in accordance with this Clause (b), the BUYER shall be entitled to rescind this Contract. 
 Payment of
refunds pursuant to this Clause shall be effected by telegraphic transfer to the account and bank specified by the BUYER free of bank charges, remittance fees, taxes and any other applicable withholdings. 
  

	3.	Termination of SELLER’s Obligation to Insure: 

 The SELLER
shall be under no obligation to insure the VESSEL hereunder after her delivery to, and her acceptance by, the BUYER. 
 (end of Article) 
  

 47 

 ARTICLE XVIII — NOTICES 
  

	1.	Address: 

 Any and all notices, invoices, requests, demands,
instructions, advices, and communications (collectively “Notices”) in connection with this Contract shall be addressed as follows: 
 To the BUYER: 
 For the commercial: 
 Seaspan Corporation 
 Unit 2 
 7th Floor, Bupa Centre 
 141 Connaught Road West 
 Hong Kong F4 00000, China 
 Facsimile:
(852)2540-1689 
 Attention: Gerry Wang, Director 
 For the technical: 
 Seaspan Ship Management Ltd. 
 2600 — 200 Granville Street 
 Vancouver, British Columbia 
 V6C1S4 
 Canada 
 Facsimile:        1-604-638-2595 
 Attention:        Peter Curtis / Peter Jackson 
 To the SELLER:

 Jiangsu Yangzijiang Shipbuilding Co., Ltd. 
 Emeizui, Huangishan Jiangyin City 
 Jiangsu Province, PRC 
 Facsimile:        0086-510-86856631 
 Attention:        Wang Dong / Shen Qiang 
  

	2.	Language: 

 All Notices shall be written in the
English language. 
  

	3.	Effective Date of Notice: 

 Any Notice shall become effective from
the date when such Notice is received by the BUYER or by the SELLER except as otherwise described in the Contract. 
  

 48 

 Notices shall be deemed to be received by the addressee when delivered (in case of personal delivery), within 7 (seven)
days of dispatch (if sent by registered airmail postage prepaid) and when dispatched (in case of telex or fax) as proven by answer back call sign or transmission report. Any such Notice received on a non-working day or after business hours in the
place of receipt shall be deemed to be received on the next following working day in such place. 
  

	4.	Change of Address: 

 Each of the parties hereto shall be entitled to
give the other party notice, in writing, of any change in any of the addresses relating to the party giving such notice and Clause 1 of this ARTICLE XVIII shall be deemed modified by and in accordance with every such notice of change. 
 (end of Article) 
  

 49 

 ARTICLE XIX — EFFECTIVE DATE OF CONTRACT 
 This Contract shall become effective on the date of fulfillment or waiver by the BUYER of all the following conditions (the “Effective Date”):

  

	(a)	Due signing of this Contract and the Specifications; and 

  

	(b)	Approval of this Contract by the board of directors of the BUYER. 

 If,
due to any reason whatsoever, any of the above conditions fails to be fulfilled by August 3, 2006, then this Contract shall be made forthwith null and void, having no effect whatsoever. No party shall be liable to the other for any loss or
damage (if any). 
 (end of Article) 
  

 50 

 ARTICLE XX — INTERPRETATION 
  

	1.	Laws Applicable: 

 The parties hereto agree that the validity and
interpretation of this Contract and of each Article and part thereof shall be governed by and be construed and interpreted in accordance with the laws of England. 
  

	2.	Entire Agreement: 

 This Contract contains the entire agreement and
understanding between the parties hereto and supersedes all prior negotiations, representations, undertakings and agreement on any subject matter of this Contract. 
 This Contract and the subject matter thereof shall not be subject to any general Terms and Conditions of the SELLER or any other terms and conditions normally or at any time put forward by the SELLER with reference to any order from or work
undertaken by the SELLER and all such General Terms and Conditions and other terms and conditions are hereby explicitly and expressly excluded from this Contract, shall form no part thereof and shall have no force and effect. 
  

	3.	Amendments and Supplements: 

 Any supplement, memorandum of
understanding or amendment, whatsoever form it may be relating to this Contract, to be made and signed among parties hereof after signing this Contract, shall be predominant over the respective corresponding Article and/or Clause of this Contract,
unless otherwise expressly stipulated. 
  

	4.	Banking Day: 

 A Banking Day under this Contract is defined as a day
on which the banks are open in China, Hong Kong and New York. 
  

	5.	No Set Off, Deduction or Counter-claim: 

 All moneys refundable or
payable to the BUYER under or pursuant to this Contract shall be paid to the BUYER without set-off or deduction or counter-claim and all moneys payable to the SELLER pursuant to this Contract shall be paid to the SELLER without set off or deduction
or counter-claim. 
  

 51 

	6.	Deemed Benefit for Servants, etc.: 

 Any exemptions from liability
and any undertaking to hold harmless which have been stipulated in this Contract to the benefit of either of the parties hereto shall be deemed to have been stipulated also to the benefit of the servants, sub-contractors, vendors and suppliers of
such party and of the servants of the said sub-contractors, vendors and suppliers. 
  

	7.	Responsibility: 

 Notwithstanding any other term of this Contract or
the Specifications, the SELLER shall be fully responsible for the due, proper, accurate, diligent and punctual designing, building, equipping, launching, outfitting and completing of the VESSEL and for the quality of the materials employed and work
done and for the delivery in due time of the VESSEL to the BUYER as herein provided, and the BUYER shall have and bear no responsibility whatsoever in respect thereof or in connection therewith as stipulated in the Contract and the Specifications.

  

	8.	Time of the Essence: 

 Time shall be of the essence hereof.

  

 52 

	9.	Headings: 

 The descriptive headings of Articles and Clauses herein
are for the convenience of reference only and are not to be used in construing or interpreting this Contract. 
 IN WITNESS WHEREOF, the parties hereto have
caused this Contract to be duly executed on the day and year first above written. 
  

									
	 BUYER
	 		 	SELLER
			
	 SEASPAN CORPORATION
	 		 	JIANGSU YANGZIJIANG SHIPBUILDING CO., LTD.
			
	 Signature:
	 		 	Signature:
			
	 /s/ GERRY WANG
	 		 	 /s/ Ren Yuan Lin

	 Name:
	 	GERRY WANG	 		 	Name:	 	Ren Yuan Lin
	 Title:
	 	CEO	 		 	Title:	 	4/7-2006
		 		 		 	Title:	 	Chairman of board

  

 53 

 EXHIBIT “A” : IRREVOCABLE LETTER OF GUARANTEE NO. 
  

					
	 	 	 	  	Date: [    ],2006
	To:	 	        SEASPAN CORPORATION	  	
	Add.:	 	        Unit 2	  	
		 	        7th Floor,
Bupa Centre	  	
		 	        141 Connaught Road West	  	
		 	        Hong Kong F4 00000, China	  	
		
	From: [                        ]	  	
	Add.: [                        ]	  	

 WHEREAS Jiangsu Yangzijiang Shipbuilding Co., Ltd.
(hereinafter called the SELLER) and SEASPAN CORPORATION (hereinafter called the BUYER) concluded on 4th July,
2006 a contract with number CMEC2006C4196 for the construction of 1 (one) 2500TEU Container Vessel (hereinafter called the “Vessel”) to be designated as Hull No.
YZJ2006-722C (hereinafter called the Contract). 
 At the application of
[                                        
                    ] and in consideration of the readiness of the BUYER to pay the SELLER the installment before delivery of the Vessel under the
Contract, we, [            ], having our registered office at [            ] The People’s Republic of China (hereinafter
called the SELLER’s Bank), hereby issue this irrevocable Letter of Guarantee (hereinafter called the Guarantee) in favor of the BUYER to irrevocably and unconditionally guarantee, as a primary obligor and not as a surety, the repayment to the
BUYER by the SELLER of the [            ] installment under the Contract prior to the delivery of the Vessel, in an aggregate amount up to but not exceeding
[            ] United States Dollars only (USD [            ], representing the
[                ] installment of the Contract Price of the Vessel, if and when the same becomes repayable to you from the SELLER in accordance with the terms of the
Contract. 
 If the SELLER fails to make such repayment within twenty (20) days after the BUYER’s demand to the SELLER, we hereby irrevocably and
unconditionally guarantee, as a primary obligor and not as a surety, to pay the BUYER upon our receipt of the BUYER’s first written demand for the above-mentioned amount together with interest thereon at the rate of six per cent (6%) per
annum in United States Dollars applicable from the date of receipt by the SELLER of the installment to the date of remittance by telegraphic transfer of such refund by us to the BUYER if the cancellation of the Contract is exercised by the BUYER in
accordance with any other provision of the Contract. 
 In the event that we receive written notification from the BUYER or the SELLER, confirmed by the
Arbitrators appointed for this purpose, advising of any dispute between the BUYER and the SELLER as to whether the SELLER shall be liable to repay the installment made by the BUYER and, consequently, whether the BUYER shall have the right to demand
payment from us (hereinafter called “Repayment Dispute”) and that such dispute has been referred to Arbitration in accordance with Article XII of the Contract, we shall be entitled to withhold and defer payment to the BUYER under this
guarantee until an award has been made under such Arbitration. Therefore, we shall not be obligated to make any payment to the BUYER unless the arbitration award orders the SELLER to make repayment and any right of appeal available to the SELLER
under the laws of England is waived or is not exercised by the SELLER in the time period provided for under English law. 

 If a sum is adjudged to be due to the BUYER by the SELLER pursuant to an award made under Arbitration, we will refund to
the BUYER to the extent the arbitration award thus orders but not exceeding the aggregate amount of this guarantee plus the interest described above, upon receipt of your written demand for payment, provided your demand for payment is accompanied by
a copy of the arbitration award. Nevertheless, the refund shall not exceed the amount actually received by SELLER with interest calculated as prescribed above, applicable from the date of receipt by Seller of the
[            ] installment to the date of remittance by telegraphic transfer of such refund. 
 The payment of the amount guaranteed hereunder shall be made by us in United States Dollars without any setoff or counterclaim and without any other deduction and withholding of whatsoever nature, including but not limited to bank charges,
remittance fees, taxes or other applicable withholdings. 
 This letter of guarantee shall be construed as a continuing and unconditional guarantee of
payment and without regard to the validity or unenforceability of any other agreement or instrument and without regard to defence, set-off or counterclaim or any other circumstance whatsoever which might constitute and equitable or legal discharge
of our obligation hereunder. No action or failure to act on the BUYER’s part shall relieve us of any of our obligations hereunder. 
 Any claim or
demand hereunder shall be in writing, signed by a director of the BUYER or an attorney-in-fact and may be served on us either by hand or by post (if sent by post to, the People’s Republic of China or such other address as we may notify
to you in writing) with confirmation in writing by, or by authenticated SWIFT via (SWIFT CODE:). 
 This Guarantee shall become effective from the time of
the actual receipt by the SELLER of the [            ] installment of [            ] United States Dollars
(USD[            ]) from the BUYER in SELLER’s account (No. [            ]) in
[            ]. 
 All rights, title and interest under this guarantee in favor of the
BUYER may be assigned to its bank, financial institution or a commercial corporation for payment except the demand right under this letter of guarantee which shall remain with yourselves and before which notice of assignment from the BUYER in the
form attached hereto must be received by us. If so requested, we will provide the BUYER with a written acknowledgment of such assignment. 
 This Guarantee
shall remain in force until the Vessel is delivered to and accepted by the BUYER, or refund has been made by the SELLER or by us for the full amount of the installment to which this Guarantee relates, or on the date which is 180 days after the
Delivery Date, whichever occurs earlier. After which you are expected to return the Guarantee to us by registered airmail for cancellation. 
 However, in
the event of a Repayment Dispute between the BUYER and the SELLER as mentioned above, the validity of this Guarantee shall then be automatically extended until the date falling on the sixty (60th) calendar day after arbitration award is
rendered. 
 Our obligations under this letter of guarantee shall not be discharged or impaired by any amendment(s) and/or supplements to the Contract. This
letter of guarantee shall continue to be effective or reinstated, as the case may be, if at any time, payment of any of payments guaranteed hereunder is rescinded or must otherwise be returned by the BUYER upon the insolvency, bankruptcy or
reorganization of the SELLER or otherwise, all as though any such payment had not been made. 
  

 55 

 This Letter of Guarantee is governed by the Laws of England and we hereby submit to the exclusive jurisdiction of the
English Courts. 
 We herewith confirm that we are permitted by the laws of the People’s Republic of China to issue guarantees with this wording and
especially to designate English law as the applicable law and London as the jurisdiction. With regard to the rules, regulations and requirements of foreign exchange by the State Administration of Foreign Exchange, i.e. registration or similar
directives, we confirm that we have the necessary authorization to transfer funds out of the People’s Republic of China in the currency or currencies required hereunder and that this Guarantee is valid and enforceable in the People’s
Republic of China or elsewhere. Equally we confirm that we have taken all other steps apart from those with regard to the State Administration of Foreign Exchange as may be required to ensure that we may transfer funds out of the People’s
Republic of China in the currency required hereunder and that this Guarantee is valid and enforceable in the People’s Republic of China or elsewhere. 
 The BUYER will return this Letter of Guarantee to us without any request or demand from us upon its expiry. Nevertheless, this Letter of Guarantee shall have expired as aforesaid, whether you return the same to us or not. 
  

	
	  

	Authorized Signatory for the SELLER’s bank

  

 56 

 ATTACHMENT 
 Date:                     

 TO: SELLER’S BANK 
 FROM: SEASPAN CORPORATION 
 We refer to the irrevocable letter of the guarantee
no.                     dated
                     (the “LOG”) issued by you to us whereby you have in the manner therein appearing guaranteed to pay to us the
sum of [                    ] United States Dollars only
(USD[                    ]) which Jiangsu Yangzijiang Shipbuilding Co., Ltd. (hereinafter called the ‘Seller’) may become liable to repay us under a shipbuilding contract dated the 4th of July, 2006 made between
ourselves and the Seller whereby the Seller has agreed to construct for us and we have agreed to purchase one 2500teu container vessel having Hull No. YZJ2006-722C subject to and upon the terms and conditions therein contained. 
 Now we hereby give you notice that: 
  

	1.	By an assignment dated [                    ] (the “Assignment”)
made between ourselves and [                    ] (the ‘Bank’), we have assigned to the Bank all our right, title, interest and
benefits in and under the LOG (with the exception of the right for making demand for payment which shall remain with ourselves) if and when all money or any part thereof shall become payable by you to us under the LOG and we are in default of our
obligations under a credit facility agreement with the Bank; 

  

	2.	We have irrevocably appointed the Bank as our attorney with full power to receive the proceeds to be described in our demand, which will be presented for payment by us in accordance
with the terms of the LOG, in the event that the security granted by the Assignment has become enforceable; 

  

	3.	Upon notice from the Facility Agent that the security granted by the Assignment has become enforceable, you are hereby irrevocably authorized and instructed and demanded by us to
pay to the Bank all sums or any part thereof which you may become due to us under the LOG; and 

  

	4.	The authority and instructions herein contained cannot be revoked or varied by us without the consent of the Bank. 

 For and on behalf of Seaspan Corporation 
  

	
	  

	 Authorized Signatory

 We acknowledge receipt of this notice of assignment of the letter of refund guarantee and hereby agree to provide
the Bank with a written acknowledgment of the assignment if so requested by the Buyer. 
  

	
	  

	 Authorized Signatory of Seller’s Bank

  

 57Shipbuilding Contract

 Exhibit 4.26 
 SEASPAN-FINAL 
 SHIPBUILDING CONTRACT 
 FOR 
 THE CONSTRUCTION OF 
 ONE (1) 5,100 TEU CLASS CONTAINER CARRIER 
 HULL NO. 1970 
 BETWEEN 
 SEASPAN CORPORATION 
 (AS BUYER) 
 AND 
 HYUNDAI HEAVY INDUSTRIES CO., LTD. 
 (AS
BUILDER) 

 INDEX 
  

							
	 	  	 	  	PAGE
	PREAMBLE	  		  	1
				
	ARTICLE	  	I	 	: DESCRIPTION AND CLASS	  	2
				
		  	II	 	: CONTRACT PRICE	  	6
				
		  	III	 	: ADJUSTMENT OF THE CONTRACT PRICE	  	7
				
		  	IV	 	: INSPECTION AND APPROVAL	  	11
				
		  	V	 	: MODIFICATIONS, CHANGES AND EXTRAS	  	18
				
		  	VI	 	: TRIALS AND COMPLETION	  	21
				
		  	VII	 	: DELIVERY	  	25
				
		  	VIII	 	: DELAYS AND EXTENSIONS OF TIME (FORCE MAJEURE)	  	29
				
		  	IX	 	: WARRANTY OF QUALITY	  	32
				
		  	X	 	: PAYMENT	  	37
				
		  	XI	 	: BUYER’S DEFAULT / BUILDER’S DEFAULT	  	43
				
		  	XII	 	: BUYER’S SUPPLIES	  	47
				
		  	XIII	 	: ARBITRATION	  	49
				
		  	XIV	 	: SUCCESSORS AND ASSIGNS	  	52
				
		  	XV	 	: TAXES AND DUTIES	  	53
				
		  	XVI	 	: PATENTS, TRADEMARKS AND COPYRIGHTS	  	54
				
		  	XVII	 	: INSURANCE	  	55
				
		  	XVIII	 	: INTERPRETATION AND GOVERNING LAW	  	56
				
		  	XIX	 	: NOTICE	  	57
				
		  	XX	 	: EFFECTIVENESS OF THIS CONTRACT	  	58
				
		  	XXI	 	: EXCLUSIVENESS	  	59
				
	SCHEDULES	  		 		  	
		
	 EXHIBIT “A”    REFUND GUARANTEE
	  	

 SHIPBUILDING CONTRACT 
 THIS CONTRACT, made on this 8th day of August, 2006 by and between Seaspan Corporation, a corporation incorporated and existing under the laws of the Marshall Islands with its principal
office at Unit 2, 7th Floor Bupa Centre, 141 Connaught Road West Hong Kong F4 0000, China (hereinafter called the
“BUYER”), the party of the first part and HYUNDAI HEAVY INDUSTRIES CO., LTD., a company organized and existing under the laws of the Republic of Korea, having its principal office at 1, Cheonha-Dong, 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 (1) 5,100 TEU Class Container Carrier
as described in Article I hereof (hereinafter called the “VESSEL”) at the BUILDER’S yards in 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 : 
 (End of Preamble) 
  

 - 1 - 

 ARTICLE I : DESCRIPTION AND CLASS 
  

	1.	DESCRIPTION 

 The VESSEL shall be a 5,100 TEU
Class Container Carrier having the BUILDER’s Hull No. 1970 and shall be designed, constructed, equipped, inspected, tested and ready for sea and suitable in all respects for its intended use for carrying dry cargo containers in accordance
with the provisions of this CONTRACT, and the full specifications reference No. CNSS5100-FS-P1 dated July 21, 2006 (hereinafter called the “FULL SPECIFICATIONS”), General Arrangement Drawing reference DWG. No. 1G-7000-201 dated
July 21, 2006 (hereinafter called the “PLAN”) and Maker’s List reference No. CNSS5100-ML-P1 dated July 21, 2006 (hereinafter collectively called the “SPECIFICATIONS”) signed by each of the parties for
identification and constituting an integral part hereof. The Approved Drawings and the Classification Society Rules as required by the SPECIFICATIONS shall constitute an integral part hereof. A reference hereafter in this CONTRACT to SPECIFICATIONS
shall be deemed to include the Approved Drawings and the Classification Society Rules. The BUILDER undertakes that the quality of the design, construction, testing and trials of the VESSEL and the quality of the VESSEL and of her workmanship shall
be in accordance with shipbuilding practice at major shipyards in Korea and the warranty provided in Article IX. 1 shall be effective to this standard. 
 The FULL SPECIFICATIONS and the PLAN are intended to explain each other and anything shown on the PLAN and not stipulated in the FULL SPECIFICATIONS or anything stipulated in the FULL 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 FULL SPECIFICATIONS and the PLAN, the FULL 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	  	max.	  	294.13 M
	Length, between perpendiculars	  		  	283.2 M
	Breadth, moulded	  		  	32.2 M

  

 - 2 - 

			
	 Depth to Upper Deck, moulded
	  	22.1 M
	 Design draft, moulded, in seawater of specific gravity of 1.025
	  	12 M
	 Scantling draft, moulded, in seawater of specific gravity of 1.025
	  	13.65 M
		
	 Deadweight (guaranteed by the BUILDER) on the above moulded scantling draft of 13.65 M
	  	67,000 M/T
	 Normal container capacity (TEU’s: 8  1/2’ high)
	  	
	 Total
	  	5,087 TEU
	 - in holds
	  	2,261 TEU
	 - on deck
	  	2,826 TEU
		
	 Container capacity (guaranteed by the BUILDER) under consideration of IMO visibility line at scantling draught with even keel
	  	5,087 TEU

  

					
	 Main propulsion engine
	  	Hyundai-Wartsila 8RTA96C
		  	MCR :	  	45,760 kW x 102 RPM
		  	NCR :	  	41,184 kW x 98.5 RPM

  

			
	 Trial speed (guaranteed by the BUILDER) at 12 meters design draft at the condition of clean bottom and in calm and deep sea with main engine
developing a NCR of 41,184 kW with fifteen per cent (15%) sea margin
	  	24.7 KNOTS
	 Specific Fuel consumption (guaranteed by the BUILDER) of the main engine applying I.S.O. reference conditions to the result of official shop
test at a MCR of 45,760 kW using marine diesel oil having lower calorific value of 42,700 kJ per Kg.
	  	171 gr/kW.HR

 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 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, all of which are subject to the approval of the BUYER which the BUYER shall not withhold unreasonably.

  

 -3 - 

	3.	CLASSIFICATION. RULES AND REGULATIONS 

  

	 	(a)	The VESSEL shall be designed, constructed, equipped, inspected, tested and completed in accordance with the rules and regulations (the edition and amendments thereto being in force
and effect as of the date of this CONTRACT, together with all mandatory rules and regulations and amendments thereto, which have already been ratified upto the date of this CONTRACT and to come into force prior to the date of keel laying of the
VESSEL) of and under survey of Det Norske Veritas (hereinafter called the “CLASSIFICATION SOCIETY”) and shall be distinguished in the register by the symbol of +1A1, Container Carrier, NAUTICUS(Newbuilding), E0, NAUT-OC, BIS, TMON, CLEAN,
BWM-E(s). Details of Class notation shall be in accordance with the SPECIFICATIONS. 

 The VESSEL shall comply with rules,
regulations, recommendations and requirements of the Authorities in force as of the date of the CONTRACT signing as described and listed in the SPECIFICATIONS, together with all mandatory rules and regulations with amendments, which have already
been ratified up to the date of this CONTRACT and to come into effect prior to the date of keel laying of the VESSEL. 
  

	 	(b)	The BUILDER shall arrange with the CLASSIFICATION SOCIETY for the assignment by the CLASSIFICATION SOCIETY representative(s) (the “Classification Surveyor”) 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, except where this CONTRACT provides for arbitration. 

 All materials, workmanship and major plans used in the
construction of the VESSEL which will comply with the rules and regulations of the CLASSIFICATION SOCIETY shall be subject to inspection and test by the CLASSIFICATION SOCIETY. 
 Subject to decisions made by the CLASSIFICATION SOCIETY pursuant to Article XIII. 1, no act or omission of the CLASSIFICATION SOCIETY and/or
Classification Surveyor shall, in any way, diminish or impair the obligations and liabilities of the BUILDER under the terms of this CONTRACT. 
  

 - 4 - 

	4.	SUBCONTRACTING 

 The BUILDER may, at its sole
discretion and responsibility, and upon written notice to the BUYER in case of sub-contracting of material nature, subcontract any portion but not the whole, of the construction work of the VESSEL outside the SHIPYARD, but in any event, major hull
structure parts will be assembled by the BUILDER provided, however, that the BUILDER shall remain responsible for the performance of this CONTRACT with regard to any work done or materials supplied or used by such subcontractors in accordance with
this CONTRACT. Subcontractors for the items of material nature shall apply same standard as the BUILDER. 
  

	5.	NATIONALITY OF THE VESSEL 

 The VESSEL shall
be registered by the BUYER at its own cost and expense under the laws of Hong Kong with its home port of Hong Kong at the time of its delivery and acceptance hereunder. 
 (End of Article) 
  

 - 5 - 

 ARTICLE II : CONTRACT PRICE 
 The contract price of the VESSEL delivered to the BUYER at the SHIPYARD shall be United States Dollars Seventy Seven Million Three Hundred Fifty Thousand (US$77,350,000) (hereinafter called the “CONTRACT
PRICE”). The CONTRACT PRICE is fixed and 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 SOCIETY and shall not include the cost of the BUYER’S SUPPLIES as stipulated in Article XII. 
 The CONTRACT PRICE also includes all costs and expenses for supplying all drawings and plans (except those to be furnished by the BUYER in respect of the BUYER’S
SUPPLIES) and designs, machinery, engines, equipment, fittings, outfittings, appurtenances, furniture, materials, parts, spares, articles and things as required by the SPECIFICATIONS and/or otherwise under this CONTRACT for the VESSEL, and all other
items and acts necessary for the performance of BUILDER’s obligations under or pursuant to this CONTRACT. 
 (End of Article) 

 

 - 6 - 

 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. 

  

	 	 (b)
	 If delivery of the VESSEL is delayed more than thirty (30) days beyond the date upon which the delivery is due from
the BUILDER under the terms of this CONTRACT, then, beginning at midnight of the thirtieth (30th) day after
such due date, the CONTRACT PRICE of the VESSEL shall be reduced by U.S. Dollars twenty five thousand (US$ 25,000) 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 date upon which the delivery is due from the
BUILDER under the terms of this CONTRACT then, in such event, and after such period has expired, the BUYER may, at its option, rescind and cancel this CONTRACT by serving upon the BUILDER a notice of cancellation by 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. If the BUYER has not served the notice of cancellation
after the aforementioned one hundred and eighty (180) days delay in delivery, the BUILDER may demand the BUYER to make an election in accordance with Article VIII.3. hereof. 

  

 -7 - 

	 	(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 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 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 speed guaranteed under this CONTRACT, the CONTRACT PRICE shall be reduced by U.S. Dollars one hundred thousand
(U.S.$ 100,000) for each full 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 eight-tenths ( 8/10) 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 eight-tenths ( 8/10) of a knot below the speed guaranteed under this CONTRACT, then the BUYER, at its option, may, subject to the BUILDER’s right to effect
alterations or corrections as provided in Article VI.5. hereof, rescind and cancel this CONTRACT or may accept the VESSEL at a reduction in the CONTRACT PRICE as above provided for eight-tenths ( 8/10) 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 main 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, if such excess is not more than five per cent (5%) over the guaranteed fuel consumption. 

  

 - 8 - 

	 	(b)	However, as for the excess of more than five per cent (5%) in the actual fuel consumption over the guaranteed fuel consumption of the VESSEL’s main engine, the CONTRACT
PRICE shall be reduced by U.S. Dollars one hundred thousand (US$ 100,000) for each full one per cent (1%) increase 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 per cent (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 eight per cent (8%) over
the guaranteed fuel consumption of the VESSEL’s main engine at the rate of reduction as specified above. 

  

	 	(c)	If such actual fuel consumption exceeds the guaranteed fuel consumption of the VESSEL’s main engine by more than eight per cent (8%), the BUYER, at its option, may, subject to
the BUILDER’s right to effect alterations or corrections as specified in Article VI.5. hereof, rescind and cancel this CONTRACT or may accept the VESSEL at a reduction in the CONTRACT PRICE as above provided for the eight per cent
(8%) increase only. 

  

	4.	DEADWEIGHT BELOW CONTRACT REQUIREMENTS 

  

	 	(a)	The CONTRACT PRICE of the VESSEL shall not be affected or changed, if actual deadweight, determined as provided in this CONTRACT and the SPECIFICATIONS, is below the deadweight of
67,000 metric tons on the moulded scantling draft of 13.65 metres required by this CONTRACT and the SPECIFICATIONS by an amount of 660 metric tons or less. However, should the deficiency in the actual deadweight of the VESSEL be more than 660 metric
tons below the said required deadweight, then the CONTRACT PRICE of the VESSEL shall be reduced for each full one (1) metric ton (fractions of less than one (1) metric ton shall be disregarded) of decreased deadweight in excess of 660
metric tons by the sum of U.S. Dollars nineteen hundred (US$ 1,900) per metric ton. 

 However, unless the parties agree
otherwise, the total amount of deduction from the CONTRACT PRICE shall not exceed the amount due to cover the deficiency of 1,300 metric tons below the said guaranteed deadweight hereinabove. 
  

	 	(b)	 If the deficiency in the deadweight of the VESSEL is more than 1,300 metric tons below the said guaranteed deadweight, then the BUYER, at its option, may, subject
to the BUILDER’s right to effect alterations or corrections without the BUYER’s prior 

  

 - 9 - 

	 	 
consent as specified in Article VI.5. hereof, rescind and cancel this CONTRACT or may accept the VESSEL at a reduction in the CONTRACT PRICE as above
provided for 1,300 metric tons of deficiency only. 

  

	5.	INSUFFICIENT CONTAINER CAPACITY 

  

	 	(a)	The CONTRACT PRICE shall not be affected or changed by reason of deficiency in the number of containers if such deficiency is up to 30 TEU containers below the guaranteed container
capacity of 5,087 TEU in accordance with IMO visibility requirement at Scantling Draft of 13.65 meters with even keel. 

  

	 	(b)	However, in the event that the deficiency in the guaranteed container capacity, is in excess of 30 TEU containers, then the CONTRACT PRICE shall be reduced by United States Dollars
forty thousand (US$ 40,000) for each TEU container in excess of the first allowable 30 TEU containers of such deficient number of containers. 

 However, unless the parties agree otherwise, the total amount of deduction from the CONTRACT PRICE shall not exceed the amount due to cover the deficiency of 80 TEU containers below the guaranteed container capacity
hereinabove. 
  

	 	(c)	If the deficiency in the guaranteed container capacity is 80 TEU containers or more, then the BUYER, at its option, may reject the VESSEL and rescind and cancel this CONTRACT in
accordance with the provisions of this Article or may accept the VESSEL at a reduction in the CONTRACT PRICE as above provided for 80 TEU containers of deficiency only. 

  

	6.	REDUCTIONS TO BE INDEPENDENT OF EACH OTHER 

 Reductions permitted herein are independent of each other and in the event of there being contingencies which necessitate the application of two or more paragraphs, there shall be separate reductions in the CONTRACT PRICE in respect of each
contingency. 
  

	7.	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. 
 (End of Article) 
  

 - 10 - 

 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 (hereinafter called the “BUYER’S REPRESENTATIVE”), who shall be duly accredited in writing by the
BUYER to supervise adequately the construction by the BUILDER 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 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. 
  

	2.	AUTHORITY OF THE BUYER’S REPRESENTATIVE 

 Such BUYER’S REPRESENTATIVE shall, at all times, subject to any safety requirements, during 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. 
 The necessary inspections and testing of the VESSEL shall be carried out by the
CLASSIFICATION SOCIETY, other regulatory bodies and an inspection team of the BUYER, including the BUYER’s REPRESENTATIVES, throughout the entire period of construction, in order to ensure that the construction of the VESSEL is duly performed
in accordance with this CONTRACT and the SPECIFICATIONS. 
 The BUILDER will endeavor to arrange for the inspection by the BUYER’S
REPRESENTATIVE during working hours of the BUILDER. However, such inspection may be arranged beyond the BUILDER’s normal working hours, including weekend and/or holiday if this is considered necessary by the BUILDER in order to meet the
BUILDER’s construction schedule, on the condition that the BUILDER will inform the BUYER’s REPRESENTATIVE at least two (2) days in advance of such inspection. 
  

 - 11 - 

 The construction of the VESSEL shall be subjected, throughout the entire period of construction, to
quality control by a quality control department of the BUILDER. The necessary tests and inspection by the CLASSIFICATION SOCIETY and other regulatory bodies concerned shall also be carried out and recorded and all results of quality control and
tests and inspections shall be communicated in the form documented as far as practicable, or in the absence of documentation, orally, to the BUYER’S REPRESENTATIVE. 
 The BUYER’S REPRESENTATIVE may attend during construction of the VESSEL, tests and inspection of the VESSEL, its machinery and equipment. The BUILDER shall make reasonable efforts to give the BUYER’S
REPRESENTATIVE an advance notice for tests and inspections within the SHIPYARD stating particulars of any tests or inspections which may be attended by the BUYER’S REPRESENTATIVE provided that in exceptional circumstances the manner in which
such notice is given may be modified by mutual agreement. Notice of tests and inspections to be conducted shall also be given to the BUYER’S REPRESENTATIVE latest up to 5:00 p.m. of the day prior to the day on which any tests or inspections
shall occur except for the painting inspection. 
 For test or inspections outside the SHIPYARD, including manufacturer’s shop tests,
sufficient advance notice to allow for the BUYER’S REPRESENTATIVE to arrange transportation shall be given. This advance notice should not be less than two (2) days except for tests or inspections within Korea that require air travel for
attendance in which case advance notice should not be less than four (4) days. And the inspection outside Korea requires seven (7) days advance notice, or twenty one (21) days advance notice if an entry VISA is required for the
BUYER’S REPRESENTATIVE. 
 Inspection schedule must be reasonable in order to allow the BUYER’S REPRESENTATIVE to carry out their
duties properly. 
 The BUYER’S REPRESENTATIVE shall, 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 to the utmost with the BUILDER in
the construction process of the VESSEL. 
 The decision, approval or advice of the BUYER’S REPRESENTATIVE shall be deemed to have been
given by the BUYER. 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 

  

 - 12 - 

 
(WARRANTY OF QUALITY). 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 and likewise advise and consult with the BUILDER on all matters pertaining to the construction of the VESSEL, as may be required by the BUILDER, or 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. 
 The BUILDER shall comply with any such demand which is not contradictory to this CONTRACT and the SPECIFICATIONS, 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 authorised representative of the BUILDER. The BUILDER shall notify the BUYER’S REPRESENTATIVE of the names
of the persons who are from time to time authorised 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, 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 CLASSIFICATION SOCIETY or failing such agreement, request an arbitration in accordance with the provisions of Article XIII hereof. 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 or the SPECIFICATIONS exists. If 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 

  

 - 13 - 

 
necessary alterations or changes, or if such alterations or changes cannot be made in time to meet the construction schedule for the VESSEL, the BUILDER
shall make fair and reasonable adjustment of the CONTRACT PRICE in lieu of such alterations and changes. If 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. 
  

	3.	APPROVAL OF DRAWINGS 

  

	 	(a)	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
XIX hereof. The BUYER shall, within twenty one (21) days after receipt thereof return 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. 

  

	 	(b)	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, 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. 

 The BUYER’S REPRESENTATIVE shall, within fourteen (14) days after receipt thereof, return 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 purposes of this CONTRACT.

  

	 	(c)	 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 

  

 - 14 - 

 
XIII 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 be entitled to place its own interpretation on such comments in implementing them. 
 The BUILDER
agrees that the BUYER is permitted to make an arrangement with the CLASSIFICATION SOCIETY for receiving copies of any technical correspondence regarding the construction of the VESSEL. 
  

	4.	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. 
  

	5.	RESPONSIBILITY OF THE BUILDER 

  

	 	(a)	The BUILDER shall, at no cost to the BUYER, furnish suitably lighted, and air conditioned office space, for a team of not less than six (6) BUYER’S REPRESENTATIVES all
along, including changing room, toilet and shower space, office furniture, drawing table and filing cabinets. Separate telephone lines and facsimile receiver to be provided in BUYER’S REPRESENTATIVE office and communication service shall be
paid by the BUYER at normal rate of charges of Korean telecommunication company. However, the changing room, toilet and shower space shall be supplied as public facilities. 

 During the last forty five (45) days of the period of construction of the VESSEL, office space shall be provided to accommodate the VESSEL’s
senior officers as far as practicable in the BUYER’S REPRESENTATIVE’s office space. 
 With an ample prior notice by the BUYER, the
BUILDER shall arrange for the BUYER’S REPRESENTATIVE suitable and convenient living quarters as near as possible to the SHIPYARD and shall provide for the purpose thereof apartments/houses fully furnished and equipped in Western style with
minimum two (2) bedrooms and one (1) living room for each BUYER’S REPRESENTATIVE, all at the BUYER’s expenses. 
  

 - 15 - 

 The BUILDER, its employees, agents and subcontractors, during its working hours until delivery of the
VESSEL, shall arrange for the BUYER’S REPRESENTATIVE 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
BUYER’S REPRESENTATIVE or his assistants or employees shall observe the work rules, regulations and the guidances prevailing at the BUILDER’s and its sub-contractor’s premises. 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 or willful misconduct 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 or willful misconduct of the BUILDER, its sub-contractors, or its or their employees or agents. 

  

	6.	RESPONSIBILITY OF THE BUYER 

 The BUYER shall
undertake and assure that the BUYER’S REPRESENTATIVE and his assistants shall carry out their duties hereunder in accordance with the normal shipbuilding practice and in such a way as to avoid any unnecessary increase in building cost, delay in
the construction of the VESSEL, and/or any disturbance in the construction schedule of the BUILDER. 
 The BUILDER has the right to request
the BUYER to replace any of the BUYER’S 

  

 - 16 - 

 
REPRESENTATIVE and/or his assistants who are deemed unsuitable and unsatisfactory for the proper progress of the VESSEL’s construction. The BUYER shall
investigate the situation by sending its representative(s) to the SHIPYARD and if the BUYER considers that such BUILDER’s request is justified, the BUYER shall effect the replacement as soon as conveniently arrangeable. 
 (End of Article) 
  

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 ARTICLE V : MODIFICATIONS, CHANGES AND EXTRAS 
  

	1.	HOW EFFECTED 

 Modifications or changes to
the SPECIFICATIONS under which the VESSEL is to be constructed may be made at any time hereafter by written agreement of the parties hereto. Any modification or change requested by the BUYER which does not affect the SPECIFICATIONS to a fundamental
extent 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 until the BUYER has agreed to such adjustments. The BUILDER shall be entitled to refuse to make any alteration,
change or modification to the SPECIFICATIONS requested by the BUYER if the BUYER does not agree to the aforesaid adjustments within fourteen (14) days of the BUILDER’S notification of the same to the BUYER or if, in the BUILDER’s
judgement, the 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 reasonable efforts to accommodate such reasonable request by the BUYER so that the said change and modification 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 may be effected by exchange of letters or facsimiles manifesting the agreement. 
 The letters and facsimiles exchanged by the parties pursuant to the foregoing shall constitute an amendment to this CONTRACT and the SPECIFICATIONS under which the VESSEL shall be built. Upon consummation of such an
agreement to modify and change the SPECIFICATIONS, 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 for the construction of the VESSEL by 

  

 - 18 - 

 
the SPECIFICATIONS or otherwise under this CONTRACT 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 for similar products, the BUILDER may supply, subject to the BUYER’s prior approval, other materials, machinery or equipment of equal
quality and effect capable of meeting the requirements of the CLASSIFICATION SOCIETY and the rules, regulations and requirements with which the construction of the VESSEL must comply. 
  

	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 authorised 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, or such longer period as is commercially reasonable in the circumstances by the agreement of the parties acting
reasonably after receiving the notice on the adjustment due to such alterations or changes from the BUILDER, the BUYER shall advise the BUILDER of its decision as to the alterations and changes to be made on the VESSEL. 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 to reasonable adjustment on: 
  

	 	(a)	any increase or decrease in the CONTRACT PRICE of the VESSEL that is occasioned by such compliance; 

  

	 	(b)	any extension or advancement in the Delivery Date of the VESSEL that is occasioned by such compliance; 

  

	 	(c)	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;

  

	 	(d)	the speed requirements if such compliance results in any increase or reduction in the speed; and 

  

 - 19 - 

	 	(e)	any other alterations in the terms of this CONTRACT or of the SPECIFICATIONS 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 by the BUYER shall be effected in the same manner as provided above for modification and change of the SPECIFICATIONS. 
 (End of Article) 
  

 - 20 - 

 ARTICLE VI : TRIALS AND COMPLETION 
  

	1.	NOTICE 

 The BUILDER shall notify the BUYER
in writing or by facsimile at least twenty one (21) 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 approximate date upon which the
trial run is expected to take place. Such date shall be further confirmed by the BUILDER six (6) days in advance of the trial run in writing or by facsimile. 
 The BUYER’S REPRESENTATIVE, who is to witness the performance of the VESSEL during such trial run, 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 and the CLASSIFICATION SOCIETY that 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 CONDITION 

 In the event of
unfavourable weather 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 unfavourable that the trial run cannot be continued, then the
trial run shall be discontinued and postponed until the first favourable 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 unfavourable weather conditions shall also operate to extend the Delivery Date of the VESSEL for the period of delay occasioned by such unfavourable weather conditions. 
  

 - 21 - 

	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, at its cost and expense, 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 judgment. The
BUILDER may repeat any trial whatsoever as it deems reasonably 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 FULL SPECIFICATIONS. The necessary ballast (fuel oil, fresh water and such other
ballast as may be required) to bring the VESSEL to the trial load draft, as specified in the FULL SPECIFICATIONS, 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 specifications of the main engine and
other machinery 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 trial 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. 
  

 - 22 - 

	5.	ACCEPTANCE OR REJECTION 

  

	 	(a)	If, during any sea trial, any breakdown occurs entailing interruption or irregular performance which can be repaired on board, the trial shall be continued after such repairs and be
valid in all respects. 

  

	 	(b)	However, if, during or after the trial run, it becomes apparent that the VESSEL or any part of her equipment requires alterations or corrections which but for this provision would
or might entitle the BUYER to cancel this CONTRACT, the BUILDER shall notify the BUYER promptly in writing or by facsimile to such effect and shall simultaneously advise the BUYER of the estimated additional time required for the necessary
alterations or corrections to be made. 

  

	 	(c)	Upon completion of the trial run, the BUILDER shall give the BUYER a notice by facsimile or in writing of completion of the trial run and provide the BUYER with all records of tests
and trials as soon as available, as and if the BUILDER considers that the results of the trial run prove conformity of the VESSEL to this CONTRACT and SPECIFICATIONS. 

 The BUYER shall, within three (3) working days after receipt of aforementioned records of tests and trials from the BUILDER, notify the BUILDER in
writing or by facsimile confirmed in writing of its acceptance or rejection of the VESSEL’S conformity to this CONTRACT and the SPECIFICATIONS. 
 Should the records of tests and trials indicate that the VESSEL does not conform to the requirements of this CONTRACT or the SPECIFICATIONS and if the BUILDER agrees with the BUYER’s notice of non-conformity, then the BUILDER shall
promptly take the necessary steps to correct such non-conformity and notify the BUYER promptly in writing or by facsimile advising the BUYER of the estimated additional time required for the necessary alterations to correct material non-conformity.

 Upon completion of correction of such non-conformity, new trial run or runs as necessary will be made to prove conformity of the VESSEL to
this CONTRACT and SPECIFICATIONS if so found necessary by the BUILDER, the CLASSIFICATION 

  

 - 23 - 

 
SOCIETY and the BUYER’S REPRESENTATIVE. The BUILDER shall notify the BUYER of the time and place of any new trial run no less than three
(3) working days beforehand, unless otherwise mutually agreed to. All provisions of the trial run shall apply to such new trial run. 
  

	 	(d)	However, the BUYER shall not be entitled to reject the VESSEL by reason of any minor or insubstantial items judged from the point of view of standard shipbuilding and shipping
practice as not being in conformity with the SPECIFICATIONS. The BUYER may accept the VESSEL qualifying its acceptance by reservations regarding works or parts which have not been completed or properly installed prior to such acceptance. In the
event that BUYER makes such qualified acceptance the parties will reach an agreement in writing, prior to the delivery of the VESSEL, as to how and when to remedy the items being the subject of the qualified acceptance, at the BUILDER’s cost
and expense, either before or after the delivery, as quickly as possible, without delaying the date of delivery and without causing the BUYER inconvenience in the operation of the VESSEL. 

  

	6.	EFFECT OF ACCEPTANCE 

 The BUYER’s
written or facsimiled notification of acceptance delivered to the BUILDER as above provided, shall be final and binding insofar 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 to the satisfaction of the BUYER. 
 If the BUYER fails to notify the
BUILDER of its acceptance or rejection of the VESSEL as hereinabove provided, the BUYER shall be deemed to have accepted the VESSEL. Nothing contained in this Article shall preclude the BUILDER from exercising any and all rights which the BUILDER
has under this CONTRACT if the BUILDER disagrees with the BUYER’s rejection of the VESSEL or any reasons given for such rejection, including arbitration provided in Article XIII hereof. Any dispute between the BUILDER and the BUYER as to the
conformity or non-conformity of the VESSEL to the requirements of this CONTRACT and/or the SPECIFICATIONS shall be submitted for final decision in accordance with Article XIII hereof. 
 (End of Article) 
  

 - 24 - 

 ARTICLE VII : DELIVERY 
  

	1.	TIME AND PLACE 

 The VESSEL, duly completed
in accordance with this CONTRACT, shall be delivered by the BUILDER to the BUYER at the SHIPYARD, safely afloat on or before April 20, 2009 (hereinafter called the “DELIVERY DATE”) after completion of satisfactory tests, 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 permit extensions of the time for delivery of the
VESSEL, the aforementioned DELIVERY DATE shall be extended accordingly. 
 An earlier DELIVERY DATE more than twenty-one (21) days is
subject to the BUYER’s prior written consent. 
  

	2.	WHEN AND HOW EFFECTED 

 Provided that the
BUYER shall with delivery of the VESSEL release to the BUILDER the sixth instalment as set forth in Article X.2. hereof and the BUYER and the BUILDER shall have fulfilled all of their obligations provided for in this CONTRACT, delivery of the VESSEL
shall be forthwith effected upon acceptance thereof by the BUYER, 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 parties hereto. 
  

	3.	DOCUMENTS TO BE DELIVERED TO THE BUYER 

 Concurrently with delivery and acceptance of the VESSEL, the BUILDER shall deliver to the BUYER the following duly authenticated documents in English, which shall accompany the aforementioned PROTOCOL OF DELIVERY AND ACCEPTANCE: 

 

	 	(a)	PROTOCOL OF TRIALS of the VESSEL made pursuant to this CONTRACT and the SPECIFICATIONS, 

  

 - 25 - 

	 	(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 and items listed in Article VI.4 if its cost is charged to the BUYER under Article
VI.4 hereof, 

  

	 	(d)	DRAWINGS AND PLANS pertaining to the VESSEL as stipulated in the FULL SPECIFICATIONS, which shall be furnished to the BUYER at no additional cost, and DRAWINGS AND PLANS in
triplicate pertaining to the VESSEL, including List of Finished Plans and As Built Specs and the trim and stability booklet, technical descriptions, test results and other data, information and documents in the possession of the BUILDER concerning
the design and construction of the VESSEL which shall be forwarded to the BUYER at no additional cost as stipulated in the SPECIFICATIONS. 

  

	 	(e)	ALL CERTIFICATES required to be furnished upon delivery of the VESSEL pursuant to this CONTRACT, the SPECIFICATIONS and the customary shipbuilding practice, including

  

	 	(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 

  

	 	(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 valid for at least five (5) months shall 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 but in any event before the expiry of the provisional certificates. 
 All certificates to be delivered to the BUYER hereunder shall be valid in every respect, unless the recommendation or notation has been approved by the
BUYER, in its sole discretion, in writing, in which case the BUILDER shall remain responsible for as promptly as possible removing such recommendation or notation. 
  

 - 26 - 

	 	(f)	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 Korean Governmental authorities, or by the prefecture or country of the port of delivery, as well as of all
liabilities of the BUILDER to its sub-contractors, suppliers, employees and crews, 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.

 In case the BUILDER fails to deliver the VESSEL free and clear of all liens, charges, mortgages and encumbrances on the date
the BUILDER offers or tenders the VESSEL for delivery, the BUYER is not obliged to take delivery of the VESSEL. If the BUYER accepts delivery of the VESSEL with such liens, charges, mortgages and encumbrances, the BUYER shall be entitled to any
rights, powers, and remedies in this CONTRACT and/or law, at equity or otherwise to recover any damages caused by such liens, charges, mortgages and encumbrances. 
  

	 	(g)	COMMERCIAL INVOICE 

  

	 	(h)	BILL OF SALE 

 If required by the BUYER, the BUILDER shall
arrange for the notarization and legalization in Korea by a consulate of the VESSEL’s country of registration of any of the listed documents/certificates which may be required to be notarized/legalized for the purposes of the BUYER’s
registration. 
  

	4.	TENDER OF THE VESSEL 

 If the BUYER 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 after compliance with its obligations as provided above. 
  

 - 27 - 

	5.	TITLE AND RISK 

 Title and risk of loss of
the VESSEL shall pass to the BUYER upon delivery of the VESSEL and acceptance by the BUYER being effected as stated above and the BUILDER shall be free of all responsibility or liability whatsoever related with this CONTRACT except for the warranty
of quality contained in Article IX, the obligation to correct and/or remedy, as provided in Article VI.5.(d) or Article VII.3.(e), if any, and the obligations in Article XVI (which survive for the period of the relevant patent), it being expressly
understood that, until such delivery and acceptance 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 XIl shall remain with the BUYER and the BUILDER’s responsibility for such BUYER’S SUPPLIES shall be as described in Article
XII.2. 
  

	6.	REMOVAL OF THE VESSEL 

 The BUYER shall take
possession of the VESSEL immediately upon delivery thereof and shall remove the VESSEL from the SHIPYARD within three (3) days after delivery thereof is effected. Port dues and other charges levied by the Korean Government Authorities after
delivery of the VESSEL and any other costs related to the removal of the VESSEL shall be borne by the BUYER. 
  

	7.	NOTICES 

 Prior to the delivery of the
VESSEL, the BUILDER shall give notice to the BUYER with the following schedule: 
 90 DAYS PRIOR TO DELIVERY - 30 DAYS ESTIMATED DELIVERY
DATE; 
 60 DAYS PRIOR TO DELIVERY - 10 DAYS ESTIMATED DELIVERY DATE; 
 30 DAYS PRIOR TO DELIVERY - 7 DAYS ESTIMATED DELIVERY DATE; 
 15 DAYS PRIOR TO DELIVERY - 1 DAY DEFINITE DELIVERY DATE 
 (End of Article) 
  

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 ARTICLE VIII : DELAYS AND EXTENSIONS OF TIME (INCLUDING 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 forgings or castings which could not have been detected by the BUILDER using reasonable care, or delays or defects in the BUYER’S SUPPLIES as stipulated in Article XII, 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 reasonable control of the BUILDER, or its
sub-contractors, as the case may be, provided all the foregoing events were not existing and known to the BUILDER at the date of this CONTRACT or the effect of which could not have been avoided or reduced by the exercise of due diligence by the
BUILDER or his relevant subcontractors, as the case may be, and provided further that the events and/or delays were not caused or contributed by the negligence or misconduct of the BUILDER in respect of labor relations or his relevant
sub-contractors, as the case may be; and provided further that any of the above events directly affect the construction schedule of the VESSEL, then, in the event of delays due to the happening of any of the aforementioned contingencies, the
DELIVERY DATE of the VESSEL under this CONTRACT shall be extended for a period of time which shall not exceed the total accumulated time of all such delays. 
 Upon occurrence of the foregoing events, the BUILDER shall take immediate steps to overcome and mitigate the delay and to recover lost time, if any. 
  

 - 29 - 

	2.	NOTICE OF DELAYS 

 As soon as practicably
possible after’ commencement of any delay, and in any event within fourteen (14) days, 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 facsimile of the date such delay commenced, the reasons thereof and, if possible, its estimated duration of the probable delay in the delivery of the VESSEL, and shall supply the
BUYER if reasonably available with evidence to justify the delay claimed. Within one (1) week after such delay ends, the BUILDER shall likewise advise the BUYER in writing or by 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 BUILDER
to notify the BUYER of its claim for extension of the DELIVERY DATE within the applicable time shall result in a waiver of the BUILDER’s claim. 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 fourteen (14) 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 XIII, (ii) the BUYER’s 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 XII, aggregates two hundred and ten (210) 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 ten (210) 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
facsimile that the BUYER make an election either to cancel this CONTRACT or to consent to the delivery of the VESSEL at such 

  

 - 30 - 

 
future date, in which case the BUYER shall, within fourteen (14) 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 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 fourteen
(14) days as provided hereinabove, 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 Paragraph 1 of this Article and any other Paragraph of this CONTRACT which expressly permits an extension of the DELIVERY DATE 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. 
 (End
of Article) 
  

 - 31 - 

 ARTICLE IX : WARRANTY OF QUALITY 
  

	1.	GUARANTEE OF MATERIAL AND WORKMANSHIP 

  

	 	(a)	The BUILDER, for the period of twelve (12) months from the date of delivery of the VESSEL to the BUYER (the “Guarantee Period”), guarantees the VESSEL in her entirety
and all parts and equipment thereof, including but without prejudice to the generality of the foregoing, the VESSEL’s design and all materials and parts manufactured, installed, furnished and/or incorporated by the BUILDER under this CONTRACT
against all defects which are due to omissions, non-conformities, defective materials or equipment, faulty design and/or performance, construction miscalculations, and/or poor workmanship (collectively, the “Defects”).

 The BUILDER will be responsible for all machinery or parts of machinery and all constructions which are supplied by
sub-contractors and will guarantee the above mentioned for the Guarantee Period on the basis as laid down in this Article. 
  

	 	(b)	The BUILDER shall pass to the BUYER information about any claims that the BUILDER may have against subcontractors for Defect(s) in deliveries to the VESSEL, without in any way
diminishing the BUILDER’s guarantee as aforesaid. 

  

	 	(c)	If the normal guarantee period stipulated by manufacturers or suppliers of any components of machinery, materials, equipment, appurtenances or outfit furnished to the BUILDER and
embodied in the VESSEL exceeds the Guarantee Period, the benefits of such extended guarantee rights shall be made available to the BUYER by the BUILDER without any additional cost to the BUYER. 

  

	2.	NOTICE OF DEFECTS 

 The BUYER or its duly
authorized representative will notify the BUILDER in writing or by facsimile promptly after discovery of any Defects for which a claim is to be made under this guarantee. 
 The BUYER’s written notice shall include full particulars as to the nature of the Defects and the extent of the damage caused thereby, but excluding consequential damage as hereinafter provided. The BUILDER will
be under no obligation with respect to this 

  

 - 32 - 

 
guarantee in respect of any claim for 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, facsimiled advice received by the BUILDER within seven (7) days after such expiry date that a claim is forthcoming will be sufficient compliance with the requirement as to time, provided that such facsimiled
advice shall include at least a brief description of the Defects, including the identity of the equipment, extent of damage, name and number of any replacement part and description of any remedial work required, and that full particulars as
practicable as possible are given to the BUILDER not later than twenty one (21) days after the expiry date. 
  

	3.	REMEDY OF DEFECTS 

  

	 	 (a)
	 The BUILDER shall remedy, at its expense, any Defects against which the VESSEL is guaranteed under this
Article7 by making all necessary repairs or replacements at the SHIPYARD or elsewhere as provided for in
subparagraph (b) below. If the cause of the Defect(s) is not known or if the Defect(s) is of a recurring nature, the BUILDER shall, at its expense, explore the reasons for such Defect(s) and take all necessary steps and measures to remedy the
same in such a way as to eliminate the reoccurrence thereof. 

 In the event of any Defect(s) guaranteed under this Article,
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 by the BUYER in getting and keeping the VESSEL ready for such repair or replacement. 
 The BUILDER and the BUYER
agree that Defects to underwater parts of the VESSEL found and detected during the Guarantee Period may be made good at the time of the first dry-docking of the VESSEL following the expiration of the Guarantee Period, however, the BUILDER shall not
be liable for any worsening of the Defects after the expiry date of the Guarantee Period, unless mutually agreed by the parties. 
  

	 	(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 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 subparagraph (c) below, unless the 

  

 - 33 - 

	 	 
forwarding or supplying thereof under the terms described in subparagraph (c) below would impair or delay the operation or working schedule of the
VESSEL. In the event 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 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, at its own cost and
expense, to verify by its own representative(s) the nature and extent of the Defect(s) complained of. 

 The BUILDER shall,
in such case, promptly advise the BUYER by facsimile, after such examination has been completed, of its acceptance or rejection of the Defect(s) as one(s) covered by the guarantee herein provided. Upon the BUILDER’s acceptance of the Defect(s)
as justifying remedy under this Article, or upon award of an arbitration so determining, the BUILDER shall compensate the BUYER an amount equal to the reasonable cost of making the same repairs or replacements at major ship repair facilities 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, and the
BUILDER shall bear and pay all C.I.F. costs of the replacement(s) until they arrive on board the VESSEL. 

  

	 	(d)	The BUILDER reserves the option to retrieve, at the BUILDER’s cost, any of the replaced equipment/parts in the event 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 XIII 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 this Article, 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

  

 - 34 - 

	 	 
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 consequential or special losses, damages or expenses (including but not limited to loss of time, loss of profit or earnings or demurrage
directly or indirectly caused) in relation to or in connection with this CONTRACT or the VESSEL. 

  

	 	(b)	The BUILDER shall be under no obligation with respect to Defects in respect of which the BUILDER has not received notice in accordance with Paragraph 2 of this Article by the expiry
of the Guarantee Period. 

  

	 	(c)	The BUILDER shall under no circumstances be liable for Defects in the VESSEL or any part of equipment thereof caused by normal wear and tear, overloading, improper loading or
stowage by the BUYER, fire unrelated to Defects, accidents at sea or elsewhere, or by incompetence, mismanagement, negligence or wilful neglect by the BUYER or any alteration or addition to the VESSEL on the part of the BUYER, its employees or
agents or any other person on or doing work on the VESSEL, including the VESSEL’s officers, crew and passengers, unless approved by the BUILDER. Likewise, the BUILDER shall not be liable for Defects due to repairs carried out by any person
other than the BUILDER or which have not been carried out in accordance with the procedure set out in Paragraph 3 (b) of this Article, unless approved by the BUILDER. 

  

	 	(d)	The BUILDER shall not be obliged to repair and shall not be liable for damage to the VESSEL or any part of the equipment thereof which, after delivery of the VESSEL, is caused other
than by Defects of the nature specified in this Article. 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,
contract (including this CONTRACT) or otherwise on the part of the BUILDER by reason of the construction and sale of the VESSEL for and to the BUYER or for any other reason whatsoever. 

  

	5.	EXTENSIONS TO THE GUARANTEE PERIOD 

 The
Guarantee Period shall be extended in, inter alia, the following cases and to the following extent: 
  

	 	(a)	If, during the Guarantee Period, the VESSEL is not be capable of performing services for periods consisting of at least twenty four (24) hours each and aggregating to eight
(8) days or more and such non-capability results from any Defect(s) covered by the BUILDER’s guarantee under this Article, then the Guarantee Period shall be extended by such period(s) of time lost in remedying the Defect(s) for which the
BUILDER is responsible according to this CONTRACT or in awaiting part(s) required for the purpose of remedying such Defect(s), however, in any event, the total guarantee period shall not extend to twenty-four (24) months from the DELIVERY DATE
of the VESSEL; 

  

 - 35 - 

	 	(b)	The Guarantee Period shall further, in relation to any qualified acceptance of the BUYER pursuant to Article VI and where the BUYER has agreed that the matters which are the subject
of the qualified acceptance may be remedied after delivery, be extended up to the expiration of twelve (12) calendar months following the time when the matters which were mentioned in the notice of the qualified acceptance are made good by the
BUILDER after the delivery of the VESSEL to the BUYER as herein provided. 

 (End of Article) 
  

 - 36 - 

 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 Instalment 

 Twenty per cent (20%) of the
CONTRACT PRICE amounting to U.S.Dollars Fifteen Million Four Hundred Seventy Thousand (US$15,470,000) shall be paid within three (3) business days after the date hereof. 
 Under this CONTRACT, in counting the business days, only Saturdays and Sundays are excepted. When a due date falls on a day when banks are not open for
business in New York, N.Y., U.S.A. and London, England, such due date shall fall due upon the first business day next following. 
  

	 	(b)	Second Instalment 

 Five per cent (5%) of the
CONTRACT PRICE amounting to U.S.Dollars Three Million Eight Hundred Sixty Seven Thousand Five Hundred (US$3,867,500) shall be paid within twelve (12) months from the date of signing this CONTRACT. 
  

	 	(c)	Third Instalment 

 Five per cent (5%) of the
CONTRACT PRICE amounting to U.S.Dollars Three Million Eight Hundred Sixty Seven Thousand Five Hundred (US$3,867,500) shall be paid within eighteen (18) months from the date of signing this CONTRACT. 
  

	 	(d)	Fourth Instalment 

 Ten per cent (10%) of the
CONTRACT PRICE amounting to U.S.Dollars Seven Million 

  

 - 37 - 

 
Seven Hundred Thirty Five Thousand (US$7,735,000) shall be paid within three (3) business days of receipt by the BUYER of a facsimiled advice from the
BUILDER that steel cutting has commenced 
  

	 	(e)	Fifth Instalment 

 Ten per cent (10%) of the
CONTRACT PRICE amounting to U.S.Dollars Seven Million Seven Hundred Thirty Five Thousand (US$7,735,000) shall be paid within three (3) business days of receipt by the BUYER of a facsimiled advice from the BUILDER that the first block of the
keel has been laid. 
  

	 	(f)	Sixth Instalment 

 Fifty per cent (50%) of the
CONTRACT PRICE amounting to U.S.Dollars Thirty Eight Million Six Hundred Seventy Five Thousand (US$38,675,000) 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 with the delivery of the VESSEL. (The date stipulated for payment of each of the six instalments mentioned above is hereinafter in this Article and in Article XI
referred to as the “DUE DATE” of that instalment). 
 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 whatever 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 XIII hereof. Expenses for remitting payments and any other expenses connected with such payments shall be for the account of the BUYER. 
  

	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 payment shall fall due hereunder, with the exception of the payment of the first and second instalments, the BUILDER shall notify the BUYER by
facsimile of the date such payment shall become due. 
 The BUYER shall immediately acknowledge receipt of such notification by facsimile to
the BUILDER, and make payment as set forth in this Article. If the BUILDER fails to receive 

  

 - 38 - 

 
the BUYER’s said acknowledgement within three (3) days after sending the aforementioned notification, the BUILDER shall promptly facsimile to the
BUYER a second notification of similar import. The BUYER shall immediately acknowledge by facsimile receipt of the foregoing second notification regardless of whether or not the first notification was acknowledged as aforesaid. 
  

	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, fourth and fifth instalments shall be made to the account (Account No.: 04-009-010) of Korea Exchange Bank, Seoul, Korea (hereinafter called
the “KEB”) with Deutsche Bank Trust Company Americas, 60 Wall Street Mail Stop NYC 60-1310, New York, N.Y. 10005, U.S.A (hereinafter called the “DBTC”) for further credit to the account (Account No.: 117-JCD-700002) of Hyundai
Heavy Industries Co., Ltd. with KEB or the account of the BUILDER with any other bank in favour of the BUILDER, as designated and notified by the BUILDER at least three (3) business days prior to the DUE DATE. 

  

	 	(ii)	Payment of the Sixth Instalment 

 The BUYER shall, at
least three (3) business days prior to the actual date of delivery of the VESSEL, request the BUYER’s bank to make an irrevocable deposit in an account in the name of the BUYER’S bank with KEB or any other bank designated by the
BUILDER and acceptable to the BUYER’s bank for a period of fifteen (15) days and covering the amount of the sixth instalment (as adjusted in accordance with the provisions of this CONTRACT), with an irrevocable instruction that the said
amount shall be released to the BUILDER against presentation by the BUILDER to KEB or such other bank of a copy of the Protocol of Delivery and Acceptance signed by the BUYER’s authorized representative and the BUILDER. Interest, if any,
accrued from such deposit shall be for the benefit of the BUYER. 
 If the BUILDER has not presented the said original of the Protocol of
Delivery and Acceptance duly signed by the BUILDER and the BUYER to the KEB or such other bank on or before the expiry of the aforesaid fifteen (15) day 

  

 - 39 - 

 
deposit period, then the BUYER shall have the right to withdraw the said deposit plus accrued interest upon the expiry of such fifteen (15) day period.
However, if a new delivery date is agreed to between the BUYER and the BUILDER, then the BUYER shall make the cash deposit in accordance with the same terms and conditions as set out above. 
  

	 	(b)	Simultaneously with each of such payments, the BUYER shall advise the BUILDER of the details of the payments by facsimile and at the same time, the BUYER shall cause the
BUYER’S remitting Bank to advise the KEB or any other bank of the details of such payments by authenticated bank cable or telex. 

  

	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 except in the case of rescission or cancellation of this
CONTRACT by the BUILDER under the provisions of Article XI hereof, 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 all sums paid by the BUYER to the BUILDER in advance of delivery on account of the VESSEL 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
seven per cent (7%) per annum from the date following the date of receipt by the BUILDER of the pre-delivery instalment(s) to the date of remittance by telegraphic transfer of such refund, provided, however, that if and to the extent the
cancellation of this CONTRACT by the BUYER is based upon delays due to a force majeure event 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
for the relevant force majeure period to six per cent (6%) per annum. 
 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 of money. 
  

 - 40 - 

 If, pursuant to this CONTRACT, the BUILDER is required to refund to the BUYER the instalments 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 XII which were not incorporated into the VESSEL and pay to the BUYER an amount equal to the cost to
the BUYER of those supplies incorporated into the VESSEL. 
 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 free of bank charge, remittance fees, taxes and other applicable withholdings incurred and levied in Korea. 
  

	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 sums paid by the BUYER to the BUILDER under the provisions of Paragraph 2 of this Article together with interest thereon at the
rate of seven per cent (7%) per annum from the date following the date of receipt by the BUILDER of such pre-delivery instalment(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 

 Upon refund by the
BUILDER to the BUYER as provided in the foregoing Paragraphs 5 and 6 all of the obligations, duties and liabilities of each of the parties hereto to the other shall be discharged. 
  

 - 41 - 

	8.	REFUND GUARANTEE 

 The BUILDER shall send a copy of the Refund Guarantee by facsimile before payment of the 1st installment by the BUYER, and deliver to the BUYER by hard copy, or by SWIFT through the BUYER’s bank, acceptable to the BUILDER, an assignable letter of guarantee issued by Calyon, Seoul Branch for the refund of the
pre-delivery instalments 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. In case of SWIFT, the BUYER shall advise the BUILDER of the details of the BUYER’s bank including the SWIFT address upon execution of this CONTRACT. 
 (End of Article) 
  

 - 42 - 

 ARTICLE XI : BUYER’S DEFAULT / BUILDER’S DEFAULT 
 1. BUYER’S DEFAULT 
  

	(a)	DEFINITION OF THE BUYER’S DEFAULT 

 The
BUYER shall be deemed to be in default under this CONTRACT in the following cases : 
  

	 	(i)	If the first, second, third, fourth or fifth instalment is not paid to the BUILDER within respective DUE DATE of such instalments as required by Article X; or

  

	 	(ii)	If the sixth instalment is not deposited in accordance with Article X.4.(a)(ii) hereof or if the said sixth instalment deposit is not released to the BUILDER against presentation by
the BUILDER of a duplicate original copy of the PROTOCOL OF DELIVERY AND ACCEPTANCE; or 

  

	 	(iii)	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

  

	 	(iv)	If an order or an effective resolution shall be passed for winding up of the BUYER (except for the purpose of reorganization, merger or amalgamation). 

  

	(b)	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.(a) above of its obligations under this CONTRACT, then; 
  

	 	(i)	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. 

  

	 	(ii)	The BUYER shall pay to the BUILDER interest at the rate of seven per cent (7%) per annum in respect of the instalment(s) in default from the respective DUE DATE to the date of
actual receipt by the BUILDER of the full amount of such instalment(s). 

  

 - 43 - 

	 	(iii)	if the BUYER is in default in payment of any of the instalment(s) due and payable prior to or simultaneously with the delivery of the VESSEL, the BUILDER shall, in writing or by
facsimile, notify the BUYER to that effect, and the BUYER shall, upon receipt of such notification, forthwith acknowledge in writing or by facsimile to the BUILDER that such notification has been received. 

  

	 	(iv)	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, at its option,
rescind this CONTRACT by serving upon the BUYER a written notice or a facsimile notice of rescission confirmed in writing. 

  

	 	(v)	In the event of such cancellation by the BUILDER of this CONTRACT due to the BUYER’s default as provided for in Paragraph 1.(a) above, the BUILDER shall be entitled to retain
and apply the instalments 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 this 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 acting reasonably. The BUILDER will invite the BUYER to participate in any public tender at least fourteen (14) days in advance. 

 The proceeds received by the BUILDER from any sale shall be applied in addition to the instalment(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 seven per cent (7%) 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 seven per cent (7%) per annum from the respective DUE DATE of the instalment 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 

  

 - 44 - 

	 	 
which the BUILDER would have been entitled to receive if the VESSEL had been completed and delivered plus interest thereon at seven per cent (7%) per
annum from the respective DUE DATE of the instalment in default to the date of sale. 

  

	 	Third,	the balance of the proceeds of sale, 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 instalment(s) retained by the BUILDER being insufficient to pay the BUILDER the total amount
required as above, the BUYER shall be liable for the deficiency and shall pay the same to the BUILDER upon its demand. 
  

	2.	BUILDER’S DEFAULT 

  

	(a)	DEFINITION OF THE BUILDER’S DEFAULT 

 The BUYER may declare the BUILDER in default and rescind this CONTRACT, all as stipulated in this CONTRACT and the SPECIFICATIONS, in any of the following cases: 
  

	 	(i)	the court declares bankruptcy proceedings against the BUILDER under the Bankruptcy Act of Korea; or 

  

	 	(ii)	there are insolvency proceedings which prevent the BUILDER from building and completing the VESSEL. 

  

	(b)	EFFECT OF THE BUILDER’S DEFAULT 

 If the
BUILDER shall be in default as provided for in Paragraph 2.(a) of this Article hereinabove, the BUYER shall, in writing or by facsimile, notify the BUILDER to that effect, and may, at its option, rescind this CONTRACT in accordance with the
provisions of this Article. 
 The BUYER shall, in writing or by facsimile, notify the BUILDER to that effect, and the BUILDER shall, upon
receipt of such notification, forthwith acknowledge in writing or by facsimile to the BUYER that such notification has been received. 
 If
any of the BUILDER’s default continues for a period of ten (10) days after the BUYER’s 

  

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notification to the BUILDER of such default, the BUYER may, at its option, rescind this CONTRACT by serving upon the BUILDER a written notice or a facsimile
notice of rescission confirmed in writing. 
  

	(c)	NOTICE OF THE BUILDER’S DEFAULT 

 In the
event the BUYER exercises its right of rescission of this CONTRACT under and pursuant to any of the provisions of this CONTRACT specifically permitting the BUYER to do so, then the BUYER shall notify the BUILDER in writing or by fax confirmed in
writing, and such rescission shall be effective as of the date notice thereof is received by the BUILDER. 
  

	(d)	REFUNDMENT BY THE BUILDER 

 In the event the
BUILDER receives the notice stipulated in Paragraph 2.(c) of this Article, the BUILDER shall promptly refund to the BUYER the full amount of all sums paid by the BUYER to the BUILDER in accordance with Article X. 
  

	(e)	DISCHARGE OF OBLIGATIONS 

 Upon such refund
by the BUILDER to the BUYER, and upon compliance with the provisions of Paragraph 2.(d) of this Article, all obligations, duties and liabilities of each of the parties hereto to the other under this CONTRACT shall be forthwith completely discharged.

 (End of Article) 
  

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 ARTICLE XII : BUYER’S SUPPLIES 
  

	1.	RESPONSIBILITY OF THE BUYER 

 The BUYER
shall, at its cost and expense, supply all the BUYER’S SUPPLIES as specified in Paragraph 0.15 of the FULL SPECIFICATIONS (hereinafter called the “BUYER’S SUPPLIES”), to the BUILDER at the SHIPYARD in proper condition ready for
installation and in accordance with the time schedule to be furnished to the BUYER 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 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 

  

 - 47 - 

	 	(b)	given the BUYER written notice of any delay in delivery of the BUYER’S SUPPLIES and the necessary document or advice for such supplies as soon as the delay occurs which might
give rise to a claim by the BUILDER under this Paragraph. 

 Furthermore, if the delay in delivery of the BUYER’S SUPPLIES
and the necessary document or advice for such supplies should exceed twenty (20) 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. 
  

	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 Paragraph 0.15 of the FULL SPECIFICATIONS after delivery of such supplies to the SHIPYARD, and
shall install such supplies on board the VESSEL at the BUILDER’s expense unless otherwise specified in the SPECIFICATIONS. 
 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 but the BUILDER shall be liable under Article IX for any defect(s) in respect of installation of the BUYER’S SUPPLIES to the VESSEL. 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 wilful default or negligence on its part, be responsible for such loss or damage. 
 (End of Article) 
  

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 ARTICLE XIII : ARBITRATION 
  

	1.	DECISIONS BY THE CLASSIFICATION SOCIETY 

 If
any dispute arises between the parties hereto in regard to the design and/or construction of the VESSEL, its machinery and equipment, and/or in respect of the materials and/or workmanship thereof and/or thereon, and/or in respect of interpretation
of this CONTRACT or the SPECIFICATIONS, the parties may by mutual agreement refer the dispute to the CLASSIFICATION SOCIETY headquarters or to such other expert as may be mutually agreed between the parties hereto, and in such case the decision of
the principal surveyor or such expert, as the case may be, shall be final, conclusive and binding upon the parties hereto. 
 In the event
that the parties hereto do not agree to settle a dispute according to the provision hereinabove, the following clauses shall apply. 
  

	2.	APPOINTMENT OF THE ARBITRATOR 

 If any
dispute or difference shall arise between the parties hereto concerning any matter or thing herein contained, or the operation or construction thereof, or any matter or thing in any way connected with this CONTRACT or the rights, duties or
liabilities of either party under or in connection with this CONTRACT, then, in every such case, the dispute or difference shall be referred to arbitration in London, England by a sole arbitrator. The arbitrator shall be appointed by agreement
within fourteen (14) days of the first written notification of either party to the other of its intention to arbitrate such dispute or difference, or in default of such agreement, upon the application of either of the parties, by the President
for the time being of the London Maritime Arbitrators Association (“LMAA”) who shall in making any such appointment have due regard to the nature of the dispute and the requirement for an expeditious resolution of the dispute and, in
particular, the availability of any arbitrator so appointed for an early hearing date. 
  

	3.	LAWS APPLICABLE 

 Any arbitration arising
hereunder shall be submitted in accordance with and subject to the Arbitration Act 1996 of England or any statutory amendments or re-enactments thereof for 

  

 - 49 - 

 
the time being in force and shall be conducted in accordance with the LMAA terms current at the time when arbitration proceedings are commenced (except as
expressly provided herein). The award of the arbitrator shall be final and binding upon parties hereto. 
  

	4.	PROCEEDINGS 

 In the event of any dispute or
difference being referred to arbitration, the parties hereby acknowledge that time is of the essence in obtaining an award from the arbitrator on such dispute or difference and the parties hereby agree that the arbitration shall be conducted
according to the following timetable: 
  

	 	(a)	The claimant in the arbitration to serve points of claim within twenty one (21) days of the appointment of the arbitrator. 

  

	 	(b)	The respondent in the arbitration to serve points of defence and points of counterclaim, if any, within twenty one (21) days thereafter. 

  

	 	(c)	The claimant to serve points of reply and defence to counterclaim, if any, within fourteen (14) days thereafter and the hearing of the arbitration to commence within twelve
(12) weeks of the appointment of the arbitrator. 

  

	5.	ALTERATION OF DELIVERY OF THE VESSEL 

 In the
event of the arbitration of any dispute or difference the award by the arbitrator shall include a finding as to whether or not the contractual delivery date of the VESSEL should, as a result of such dispute, be in any way altered thereby.

  

	6.	NOTICE OF AWARD 

 The award shall immediately
be given to the BUYER and the BUILDER in writing or by facsimile confirmed in writing. 
  

 - 50 - 

	7.	EXPENSES 

 The Arbitration Board shall
determine which party shall bear the expenses of the arbitration or the portion of such expenses which each party shall bear. 
  

	8.	ENTRY IN COURT 

 In case of failure by either
party to respect the award of the arbitration, judgment upon the award may be entered in any court having jurisdiction thereof. 
 (End of
Article) 
  

 - 51 - 

 ARTICLE XIV : SUCCESSORS AND ASSIGNS 
 The BUILDER agrees that, prior to delivery of the VESSEL, this CONTRACT may, with the prior written approval of the BUILDER, which the BUILDER shall not unreasonably
withhold, be transferred by the BUYER to and the title thereof may be taken by another company. In the event of any assignment 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. 
 Notwithstanding the above,
the BUYER has the right to assign this CONTRACT to a bank or syndicate of banks or financial institution or any commercial corporation assisting in the finance of the VESSEL prior to delivery of the VESSEL provided that the BUYER has given the
BUILDER a notice of assignment in form and content acceptable to the BUILDER acting reasonably. The BUILDER shall, at the BUYER’s request, acknowledge and consent to such assignment by signing an acknowledgement and consent acceptable to the
BUILDER acting reasonably. 
 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, and provided always that BUILDER shall remain responsible for the due performance of this CONTRACT by the assignee. 
 (End of Article) 
  

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 ARTICLE XV : TAXES AND DUTIES 
  

	1.	TAXES 

 Unless otherwise expressly provided
for in this CONTRACT, all taxes, fees and duties including stamp duties, if any, incurred in or levied by any country except Korea in connection with its performance under this CONTRACT shall be borne by the BUYER except for taxes, fees and duties
imposed on those items to be procured by the BUILDER for construction of the VESSEL and all taxes, fees and duties, including stamps duties, if any, incurred and levied by Korea in connection with its performance under this CONTRACT 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 terms 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. 
 (End of Article) 
  

 - 53 - 

 ARTICLE XVI : PATENTS. TRADEMARKS AND COPYRIGHTS 
  

	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 FULL 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 shall not disclose the same or divulge any information contained therein to any third parties, including but not limited to any other shipbuilders, without the prior written consent of the BUILDER, excepting where it is necessary for
usual operation, repair and maintenance of the VESSEL. In case the BUYER is in breach of its obligation under this Article, the BUILDER shall be entitled to any rights, powers and remedies in this CONTRACT and/or at law, at equity or otherwise to
recover any damages caused by the breach of the BUYER. 
 (End of Article) 
  

 - 54 - 

 ARTICLE XVII : INSURANCE 
 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 for the VESSEL or built into, or installed in or upon the VESSEL, including the BUYER’S SUPPLIES, fully insured with first-class Korean insurance companies under coverage corresponding to the
Institute of London Underwriters for BUILDER’s Risks Clauses. 
 Such insurance coverage shall, up to the date of delivery of the VESSEL, be the
aggregate amount of the instalments paid by the BUYER to the BUILDER plus the value of the BUYER’S SUPPLIES in the custody of the BUILDER. 
 The
BUILDER’s obligation to insure the VESSEL hereunder shall cease and terminate forthwith upon delivery thereof and acceptance by the BUYER. 
 (End of Article) 
  

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 ARTICLE XVIII : 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, and be construed and interpreted with, the laws of England. 
 (End of Article) 
  

 - 56 - 

 ARTICLE XIX : NOTICE 
 Any and all notices, requests, demands, instructions, advices and communications in connection with this CONTRACT shall be written in English, sent by registered air mail or facsimile and shall be deemed to be given
when first received whether by registered mail or facsimile. They shall be addressed as follows, unless and until otherwise advised : - 
  

			
	 To the BUILDER:
	  	 Hyundai Heavy Industries Co., Ltd.
 1, Cheonha-Dong,
Dong-Ku, Ulsan Korea

		  	Attn: Project Management Department
		  	Facsimile: (82) (52) 230-3448, 230-3425
		
	 To the BUYER:
	  	Commercial
		  	 Seaspan Corporation
 Unit 2, 7th Floor Bupa Center
 141 Connaught
Road West, Hong Kong F4 0000 China

		  	Attn: Gerry Wang
		  	Facsimile No.: 852-2540-1689
		
		  	Technical
		  	 Seaspan Ship Management Ltd.
 2600 – 200
Granville Street
 Vancouver, B.C. V6C 1S4 Canada

		  	Attn: Peter Curtis / Peter Jackson
		  	Facsimile No.: 1-604-638-2595

 The said notices shall become effective upon receipt of the letter 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. 

Notices shall be deemed to be received by the addressee when delivered (in case of personal delivery), within 7 (seven) days of dispatch (if sent by registered
airmail postage prepaid) and when dispatched (in case of facsimile) as proven by answer back call sign or transmission report. Any such Notice received on a non-working day or after business hours in the place of receipt shall be deemed to be
received on the next following working day in such place. 
 (End of Article) 
  

 - 57 - 

 ARTICLE XX : EFFECTIVENESS OF THIS CONTRACT 
 This CONTRACT shall become effective upon signing by the parties hereto. 
 (End of Article) 
  

 - 58 - 

 ARTICLE XXI : 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 on any subject matter of this CONTRACT, oral
or written, made and entered into between the parties prior to the execution of this CONTRACT shall be null and void. 
 This CONTRACT may be supplemented or
amended in writing by the parties and any supplement or amendment, whatsoever form it may be relating to this CONTRACT, to be made and signed among parties hereof concurrently with or after the signing this CONTRACT, shall govern in respect of the
corresponding Article or Clause, as the case may be, of this CONTRACT, unless otherwise expressly stipulated in supplement or amendment. 
 (End of Article) 
  

 - 59 - 

 IN WITNESS WHEREOF, the parties hereto have caused this CONTRACT to be duly executed on the date and year first
above written. 
  

							
	 BUYER
	 	 BUILDER

	 For and on behalf of
 SEASPAN CORPORATION
	 	     For and on behalf of
     HYUNDAI HEAVY INDUSTRIES CO., LTD.

				
	By:	 	 /s/ GERRY WANG
	 	    By:	 	 /s/ D.Y. HAN

	Name:	 	GERRY WANG	 	    Name:	 	D.Y. HAN
	Title:	 	CHIEF EXECUTIVE OFFICER	 	    Title:	 	SENIOR EXECUTIVE V.P.
	WITNESS:	 		 	    WITNESS:	 	

  

 - 60 - 

 EXHIBIT “A” 
 OUR LETTER OF REFUNDMENT GUARANTEE NO.               
 Date :             , 2006 
 Gentlemen: 

We,                         
(hereinafter called the “Bank”), hereby issue our irrevocable letter of refundment guarantee number                      (the
“Letter”) in favour of SEASPAN CORPORATION (hereinafter called the “BUYER”), a company organized and existing under the laws of the Marshall Islands, for account of Hyundai Heavy Industries Co., Ltd., Ulsan, Korea (hereinafter
called the “BUILDER”) in consideration of the BUYER making advance payments to the BUILDER under the shipbuilding contract dated             , 2006 (hereinafter called the
“CONTRACT”) made by and between the BUYER and the BUILDER for the design, construction, and sale of one (1)                     
having the BUILDER’s Hull No.          (hereinafter called the “VESSEL”). 
 Whereas in Article
X of the CONTRACT, the BUYER is required to make          (    ) advance payments of the CONTRACT price in the following amounts: First Instalment amounting to
             United States Dollars, Second Instalment amounting to              United States Dollars, Third
Instalment amounting to              United States Dollars, Fourth Instalment amounting to              United
States Dollars, Fifth Instalment amounting to              United States Dollars. 
 If,
in connection with or under the terms of the CONTRACT, the BUYER shall become entitled to a refundment of the advance payment(s) made to the BUILDER prior to the delivery of the VESSEL, we hereby irrevocably and unconditionally guarantee as a
primary obligor and not as a surety that we shall pay to the BUYER on demand the sum of [insert first instalment] United States Dollars (in U.S. Dollars only), together with interest thereon at the rate of
         percent (    %) per annum from the date following the date of receipt by the BUILDER of any advance payment to the date of remittance by telegraphic transfer of
such refundment. 
 The amount of this Letter shall automatically increase upon the BUILDER’s receipt of the respective instalment, not more than
             (            ) times, each time by the amount of the respective instalment plus interest thereon as
provided in the CONTRACT, but in any eventuality, the amount of this guarantee shall not exceed the total sum of              United States Dollars (in U.S. Dollars only) plus
interest thereon at the rate of          percent (    %) per annum from the date following the date of the BUILDER’s receipt of each instalment to the date of
remittance by telegraphic transfer of the refundment. However, in the event of cancellation of the CONTRACT being based on delays due to force majeure or other causes beyond the control of the BUILDER, the interest rate of the 
 refundment shall be reduced to          percent (    %) per annum as provided in Article
X.5 of the CONTRACT. 
  

 - 1 - 

 The payment by the undersigned under this Letter (subject to the third and fourth paragraph hereof) shall be made upon
simple receipt by us of written demand from the BUYER, including a signed statement certifying that the BUYER’s demand for refundment has been made in conformity with Article X of the CONTRACT and the BUILDER has failed to make the refundment.
Refundments shall be made to the BUYER by telegraphic transfer in freely transferable United States Dollars free of bank charges, remittance fees, taxes, and other applicable withholdings. 
 It is hereby understood that payment of any interest provided herein is by way of liquidated damages due to cancellation of the CONTRACT and not by way of compensation
for use of the money. 
 Notwithstanding the provisions hereinabove, in the event that within thirty (30) days from the date of the BUYER’s claim
of refundment to the BUILDER referred to above, we receive notification from the BUYER or the BUILDER that is accompanied by written confirmation of the arbitrator(s) appointed for this purpose stating to the effect that the BUYER’s claim to
cancel the CONTRACT or the BUYER’s claim for refundment thereunder has been disputed and referred to arbitration in accordance with the provisions of the CONTRACT, the period of validity of this guarantee shall be extended until Forty-Five
(45) days after the award has been rendered in the arbitration, and we shall under this guarantee, refund to the BUYER the sum adjudged to be due to the BUYER by the BUILDER pursuant to the award made under such arbitration immediately upon
receipt from the BUYER of a simple demand for the sums so adjudged accompanied by a copy of the arbitration award. 
 We hereby agree that this Letter shall
be construed as a continuing and unconditional guarantee of payment without regard to the validity or enforceability of any other agreement or instrument and without regard to defence, set-off, or counterclaim or any other circumstance whatsoever
which might constitute an equitable or legal discharge of our obligations hereunder. No action or failure to act on the BUYER’s part shall relieve us of any of our obligations hereunder. 
 This Letter shall become null and void upon receipt by the BUYER of the full sum guaranteed hereby or upon acceptance by the BUYER of the delivery of the VESSEL in
accordance with the terms of the CONTRACT as evidenced by the Protocol of Delivery and Acceptance duly signed by the BUILDER and the BUYER and, in either case, the BUYER shall return this Letter to us or shall arrange with their bank to confirm to
us by SWIFT (our SWIFT address :             ) that this Letter is null and void. 
 This
Letter is assignable to the BUYER’s financier, whether it is a bank, financial institution, or a commercial corporation, by giving written notice to us. 
 This Letter is valid from the date of this Letter until such time as the VESSEL is delivered by the BUILDER to and accepted by the BUYER in accordance with the provisions of the CONTRACT. This Letter shall continue to be effective or
reinstated, as the case may be, if at any time, payment of any of the payments guaranteed hereunder is rescinded or must otherwise be returned by the BUYER upon the insolvency, bankruptcy, or reorganization of the BUILDER or otherwise, all as though
any such payment had not been made. 
 AII demands and notices in connection with this Letter shall be validly given if sent to us by post, fax, or telex to
our office as follows: 
  

			
	  

	  

	Address:	 	
	Tel:	 	
	Fax:	 	

  

 - 2 - 

 This guarantee shall be governed by and construed in accordance with the laws of England, and the undersigned hereby
submits to the exclusive jurisdiction of the courts of England. 
 Very truly yours, 
 For and on behalf of 
  

									
	By:	 	  
	 		 	By:	 	  

	Name:	 		 		 	Name:	 	
	Title:	 		 		 	Title :	 	

  

 - 3 -

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00119-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00119-of-00352.parquet"}]]