HD Korea Shipbuilding & Offshore Engineering

Article 15 (Issuance of Convertible Bonds)

• ① The Company may issue convertible bonds to persons other than shareholders subject to a resolution of the board of directors within the scope of total nominal value of the bonds not exceeding ₩400 billion when falling under one of the followings:
  • (1) Where the Company issues convertible bonds in a way granting opportunities for specific persons to subscribe the bonds aside from the ways under Subparagraph 1 of Paragraph 1 of Article 9 when necessary to achieve business goals of the Company, including introduction of new technology and improvement of financial structure;
  • (2) Where the Company issues convertible bonds in a way offering an opportunity for many and unspecified individuals to subscribe the bonds aside from the ways under Subparagraph 1 of Paragraph 1 of Article 9 and subsequently allocating the bonds to the persons subscribing;
• ② When allocating the bonds in a way under Subparagraph 2 of Paragraph 1, the Company shall allocate the bonds in a way falling under any of the followings subject to a resolution of the board of directors:
  • (1) Where the Company allocates the bonds to many and unspecified individuals subscribing the bonds without classifying the types of individuals granted with opportunity to subscribe the bonds;
  • (2) Where the Company first grants opportunities to shareholders to subscribe the bonds and then grants opportunities to many and unspecified individuals to be allocated with the bonds when there are bonds not subscribed;
  • (3) Where an investment trader or investment broker grants an opportunity to subscribe the bonds to specific type of individuals based on reasonable standards prescribed by applicable statutes, including demand forecast prepared as a subscriber or broker;
• ③ With convertible bonds under Paragraph 1, the board of directors may issue the bonds under the condition to grant the right to convert only to part of the bonds.
• ④ The stocks issued due to conversion shall be common stocks for \200 billion KRW of total nominal value of the bonds and Class 1 Stock for \200 billion KRW of total nominal value of the bonds; and when the bonds are issued at the face value of the stocks or higher, the conversion price shall be determined by the board of directors.
• ⑤ The period during which conversion may be requested shall be from the following day of the issuance date of the bonds in the given year until the day immediately before the redemption date; however, the period to request conversion may be adjusted subject to a resolution of the board of directors within the period above.
• ⑥ Article 10 shall apply mutatis mutandis to dividends of the stocks issued due to conversion and interest payment for convertible bonds.

Article 16 (Issuance of Bonds with Warrants)

• ① The Company may issue bonds with warrants to persons other than shareholders subject to a resolution of the board of directors within the scope of total nominal value of the bonds not exceeding ₩400 billion when falling under one of the followings:
  • (1) Where the Company issues bonds with warrants in a way granting opportunities for specific persons to subscribe the bonds aside from the ways under Subparagraph 1 of Paragraph 1 of Article 9 when necessary to achieve business goals of the Company, including introduction of new technology and improvement of financial structure;
  • (2) Where the Company issues bonds with warrants in a way offering an opportunity for many and unspecified individuals to subscribe the bonds aside from the ways under Subparagraph 1 of Paragraph 1 of Article 9 and subsequently allocating the bonds to the persons subscribing;
• ② When allocating new stocks in a way under Subparagraph 2 of Paragraph 1, the Company shall allocate the bonds subject to a resolution of the board of directors in a way falling under any of the followings:
  • (1) Where the Company allocates the bonds to many and unspecified individuals subscribing the bonds without classifying the types of individuals granted with an opportunity to subscribe the bonds;
  • (2) Where the Company first grants opportunities to stockholders to subscribe the bonds and then grants opportunities to many and unspecified individuals to be allocated with the bonds when there are bonds not subscribed;
  • (3) Where an investment trader or investment broker grants an opportunity to subscribe the bonds to specific type of individuals based on reasonable standards prescribed by applicable statutes, including demand forecast prepared as a subscriber or broker;
• ③ The amount for new stocks to be subscribed shall be determined by the board of directors within the scope not exceeding the total nominal value of the bonds.
• ④ The stocks issued by exercising subscription rights shall be common stocks for \200 billion KRW of total nominal value of the bonds and Class 1 Stock for \200 billion KRW of total nominal value of the bonds; and when the bonds are issued at the face value of the stocks or higher, the issuance price shall be determined by the board of directors.
• ⑤ The period during which subscription rights may be exercised shall be from the following day of the issuance date of the bonds in the given year until the day immediately before the redemption date; however, the period to exercise subscription rights may be adjusted subject to a resolution of the board of directors within the period above.
• ⑥ Article 10 shall apply mutatis mutandis to dividends of the stocks issued by exercising subscription rights.

Article 16-2 (Issuance of Bonds)

• ① The Company may issue bonds subject to a resolution of the board of directors.
• ② The board of directors may entrust the representative director to issue bonds within the period not exceeding one year after determining the amount and type of bonds.

Article 16-3 (Provisions Applicable Mutatis Mutandis Concerning Issuance of Bonds)

Provisions in Article 12 shall apply mutatis mutandis to the issuance of bonds.

Article 16-4 (Electronic Registration of Rights to Be Indicated at Bonds and Certificate for Subscription Right of New Stock)

The Company shall electronically register the rights to be indicated at the bonds and certificate for subscription right of new stock with the electronic registration account book of an electronic registration authority instead of issuing the bonds and certificate for subscription right of new stock: Provided that in cases of bonds, the Company may not electronically register the rights, except for the listed bonds of which electronic registration is mandated by applicable statutes.