EXHIBIT 10.18
THE EXPORT-IMPORT BANK OF KOREA
[LETTERHEAD]
REFUND GUARANTEE
To: PETRODRILL CONSTRUCTION INC April 16, 1998
Daewoo Heavy Industries Ltd's Hull Number 3015
We hereby issue our irrevocable guarantee No.M0902-804-LG-00040 in favour of
yourselves, Petrodrill Construction Inc, for the account of Daewoo Corporation
and Deawoo Heavy Industries Ltd (hereinafter called the "Builder") in connection
with the shipbuilding contract dated 9th April 1998 (hereinafter called the
"Contract") made by and between yourselves and the Builder for the construction
and sale of one Dynamic Positioned Semi-Submersible Drilling Vessel having
Builder's Hull No.3015 (hereinafter called the "Vessel"). Other terms and
expressions employed herein shall bear the same meaning as in the Contract, a
copy of which has been provided to us.
Under the terms of the Contract you are to pay to the Builder a Contract Price
for the Vessel in five instalments payable as follows:-
(a) FIRST INSTALMENT:
10 percent (ten %) of the Provisional Contract Price, being $13,600,000
shall be paid within three Banking Days of the Effective Date.
(b) SECOND INSTALMENT:
30 percent (thirty %) of the Provisional Contract Price, being $40,800,000
shall be paid within three Banking Days from receipt by the Purchaser of a
telefax notice from the Builder attaching a Stage Certificate in the form
of the draft attached as Appendix V, countersigned by an Authorised
Representative (or, in default thereof, the Classification Surveyor),
certifying that it is 6 months after the Effective Date of the contract has
taken place.
(c) THIRD INSTALMENT:
20 percent (twenty %) of the Provisional Contract Price, being $27,200,000
shall be paid within three Banking Days from receipt by the Purchaser of a
telefax notice from the Builder attaching a Stage Certificate in the form
of the draft attached as Appendix V, countersigned by an Authorised
Representative (or, in default thereof, the Classification Surveyor),
certifying that Keel laying has taken place.
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(d) FOURTH INSTALMENT:
20 percent (twenty %) of the Provisional Contract Price, being $27,200,000
shall be paid within three Banking Days from receipt by the Purchaser of a
telefax notice from the Builder attaching a Stage Certificate in the form
of the draft attached as Appendix V, countersigned by an Authorised
Representative (or, in default thereof, the Classification Surveyor),
certifying that launcing [float out] has taken place.
(e) FIFTH INSTALMENT:
20 percent (twenty %) of the Provisional Contract Price, together with the
aggregate of (i) any excess of the Contract Price over the Provisional
Contract Price and (ii) any increase or any decrease of the Contract Price
arising from the provisions of Clauses 7 and 16 below, shall be paid upon
Delivery.
In accordance with the terms of the Contract you are entitled either upon your
rescission therof or upon a Total Loss of the Vessel to repayment of the
instalments of the Contract Price paid by you prior to such rescission, together
with interest thereon at a fixed rate of 10% p.a. (calculated on the same basis
as any London inter-bank commercial transaction) from the date of payment by the
Purchaser to the date such instalments plus interest are returned to the
Purchaser. In the event that the Builder shall fail to make such repayment, we
shall pay to you the sum or sums due to you from the Builder against your
written statement (or that of your assignee) that demand for repayment has been
made and that the Builder has within thirty(30) Business Days of such demand
failed to comply therewith. Such written statement shall identify (i) the number
and amount of Instalments in respect of which repayment has not been received
and (ii) the total interest payable in respect of the same on the assumption
that payment of the principal sum outstanding is made by us thirty (30) Business
Days from the date of receipt of such statement.
This guarantee shall initially secure repayment of the First Instalment of the
Contract Price (plus interest thereon as hereinbefore provided) from the date of
receipt of the same by the Builder. The maximum sum claimable by you hereunder
will thereafter be automatically increased upon Builder's receipt of each
further Instalment of the Contract Price payable prior to Delivery of the
Vessel, each time by the amount of such Instalment plus interest thereon as
hereinbefore provided, but in any eventuality our total liability hereunder
shall not exceed the sum of US$108,800,000 plus interest thereon as hereinbefore
provided.
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THE EXPORT-IMPORT BANK OF KOREA
[LETTERHEAD]
Notwithstanding the provisions here in above in case we receive notification
from you or the Builder stating that the question of your rescission of the
Contract or your claim for refundment thereunder has been disputed and referred
to the Commercial Court in accordance with the provisions of the Contract, this
Guarantee shall be valid until 30 days after the final judgement shall be
rendered in said Court. In such case this Guarantee shall only be available to
the extent of a final judgement in your favour by such Court justifying your
claim for refundment as presented to us or specifying such lesser amount as the
Court may determine as being due to you.
Our liability hereunder shall not be affected by any alteration to, or variation
of, the terms of the Contract you may hereafter agree with the Builder or any
other matter or circumstance which would, but for this clause, operate to
exclude or limit our liability hereunder.
This guarantee shall be fully assignable by you. It shall expire and become null
and void upon the earliest of (i) receipt by you or your assignee of the amount
guaranteed hereunder and (ii) Delivery of the Vessel in accordance with the
provisions of the Contract or (iii) valid rescission by the Builder in
accordance with the terms of the Contract. In such case, this guarantee shall be
returned to us.
This guarantee shall be governed by, and construed in accordance with English
law, and we hereby (i) agree for your exclusive benefit that any legal action or
proceeding arising hereunder may be brought in the High Court of Justice in
England (ii) irrevocably submit to the jurisdiction of that court and (iii)
irrevocably designate, appoint and empower London Representative Office of The
Export-Import Bank of Korea (the present address of whose registered office is
3rd floor Boston House, 63 New Broad Street, London EC2M 1JJ, United Kingdom) to
receive for us and on our behalf of process in England.
Yours very truly,
For and on behalf of
The Export-Import Bank of Korea
By: /s/ WON-YOUNG CHUN By: /s/ JONG BOK LEE
Name: Won-Young Chun Name: Jong Bok Lee
Title: Senior Manager & Title: Assistant Manager &
Senior Loan Officer Loan Officer
/Ship Export Credit Dept. /Ship Export Credit Dept.
THE EXPORT-IMPORT BANK OF KOREA
LIST OF
AUTHORIZED SIGNATURES
THE EXPORT-IMPORT BANK OF KOREA
INSTRUCTIONS
This booklet contains the facsimile signatures in alphabetical order of the
officers, who are authorized to sign on behalf of this bank.
1. Each member of the Board of Executive Directors has full and complete
authority to sign alone for this bank.
2. The transactions mentioned below in excess of U$10,000 (or the equivalent
thereof in other currency) shall be signed by two officers, at least one of
whom must be an officer in A Class.
A. Issuance of check, bill of exchange or promissory note.
B. Instructions to effect the payment or transfer of funds not involving
the documentary letter of credit.
C. Opening and amendment of letter of guarantee.
D. Opening and amendment of clean letter of credit.
We will inform you of any change of list whenever it occurs.
- 1 -
THE EXPORT-IMPORT BANK OF KOREA
Chang-Jin Chong A
/s/ CHANG-JIN CHONG
049
Won-Young Chun A
/s/ WON-YOUNG CHUN
050
Chang-Ho Chung B
/s/ CHANG-HO CHUNG
051
Chul-Choong Chung A
/s/ CHUL-CHOONG CHUNG
052
THE EXPORT-IMPORT BANK OF KOREA
Young-Kon Kim B
/s/ YOUNG-KON KIM
Hyung-Ju Lee B
/s/ HYUNG-JU LEE
Jae-Hong Lee B
/s/ JAE-HONG LEE
Jong-Bok Lee B
/s/ JONG-BOK LEE