Ship Building Contract (2006)Full Document 

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SHIP BUILDING CONTRACT

(Contract Number: 2006YZJ023CA)

FOR

CONSTRUCTION OF ONE 2500 TEU CONTAINER VESSEL

(HULL No. YZJ2006–716C)

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

 

i


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

 

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ARTICLE XIV - TAXES AND DUTIES

   42

1.

  

Taxes and Duties Incurred in China:

   42

2.

  

Taxes and Duties Incurred outside China:

   42

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:

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