HD Korea Shipbuilding & Offshore Engineering

Article 1 (Amendments to Articles of Incorporation)

Amendments to the articles of incorporation of the Company shall be subject to a resolution of a general meeting of shareholders.

Article 2 (Detailed Regulations and Bylaws)

Detailed regulations and bylaws required for execution of business affairs and management of the Company shall be determined and implemented by the board of directors.

Article 3 (Enforcement Date)

The articles of incorporation shall enter into force on March 28, 2023.

• · December 28, 1973 Enacted
• · January 3, 1974 Amended
• · January 4, 1974 Amended
• · January 5, 1974 Amended
• · January 09, 1974 Amended
• · January 10, 1974 Amended
• · January 15, 1974 Amended
• · February 22, 1974 Amended
• · September 27, 1978 Amended
• · December 14, 1978 Amended
• · March 11, 1980 Amended
• · March 18, 1980 Amended
• · August 31, 1981 Amended
• · October 12, 1981 Amended
• · July 03, 1982 Amended
• · December 4, 1982 Amended
• · June 29, 1983 Amended
• · September 1, 1984 Amended
• · October 4, 1984 Amended
• · August 1, 1987 Amended
• · March 26, 1988 Amended
• · December 22, 1989 Amended
• · November 26, 1991 Amended
• · November 30, 1991 Amended
• · June 01, 1992 Amended
• · June 03, 1992 Amended
• · June 20, 1992 Amended
• · March 11, 1993 Amended
• · September 24, 1993 Amended
• · October 28, 1993 Amended
• · December 29, 1993 Amended
• · March 16, 1995 Amended
• · March 15, 1996 Amended
• · March 24, 1997 Amended
• · March 27, 1998 Amended
• · March 20, 1998 Amended
• · March 24, 2000 Amended
• · March 16, 2001 Amended
• · March 15, 2002 Amended
• · March 14, 2003 Amended
• · March 19, 2004 Amended
• · March 18, 2005 Amended
• · March 17, 2006 Amended
• · March 16, 2007 Amended
• · March 14, 2008 Amended
• · March 13, 2009 Amended
• · March 12, 2010 Amended
• · March 11, 2011 Amended
• · March 16, 2012 Amended
• · March 25, 2016 Amended
• · March 29, 2018 Amended
• · March 26, 2019 Amended
• · May 31, 2019 Amended
• · March 24, 2021 Amended
• · March 28, 2023 Amended

Article 4 (Appendix)

Appendix 1 and Appendix 2 shall constitute the portion of the articles of incorporation.

<Appendix 1> Conditions and Details of Preferred Dividends

The Company shall be obligated to distribute preferred dividends for Class 4 Stocks in cases where the Company has distributable profits in each fiscal year for 5 years from the issuance date (excluding the extended period if the redemption period is extended), and when the Company fails to pay dividends for Class 4 Stocks in accordance with the preferred dividend rate, the dividends for common stocks shall not be distributed during the fiscal year concerned. When the Company fails to pay certain dividends for Class 4 Stocks in any given fiscal year, the accumulated unpaid dividends shall be preferentially distributed during the payment of dividends in the following fiscal year.

The Company shall calculate and pay the dividends for Class 4 Stocks based on the following formula subject to a resolution of a general meeting of shareholders within the scope of distributable profits calculated in accordance with the Commercial Act and applicable statutes (Provided that when the dividend rate of common stocks exceeds the dividend rate of preferred stocks, the dividends shall be paid in the same rate with that of common stocks for the portion in excess, and the amount of dividend per share shall be increased accordingly):
- Dividend per share = issuance price per share x preferred dividend rate

The record date of dividend payout for each fiscal year shall be as prescribed in Article 10 of the articles of incorporation.

When the preferred dividend rate becomes zero as the preferred dividends are reduced pursuant to the agreement with the shareholders holding Class 4 Stocks, the restrictions on common stocks due to preferred dividends above shall be rescinded.

<Appendix 2> Adjustment Formula for Conversion Price

The Initial Conversion Price shall be the issuance price of Class 4 Stock. It means that the conversion rate shall be 1-to-1, but shall be adjusted as follows. Upon a number of grounds for conversion, adjustments shall be made cumulatively. When the conversion price increases based on the results from adjustments to the conversion price, the Company shall engage in the procedure of capital reduction required by the Commercial Act when necessary:

(A) Dilutive Adjustment

(1) When division, merger, merger after division, comprehensive swap of shares, comprehensive transfer of shares or reduction of capital (the “Merger, etc.”) of the Company are conducted, the conversion prices shall be adjusted in order for shares and other properties of the company (or the succeeding company during the Merger, etc. or parent company, etc.) to be received in the quantity which would have been distributed for common stocks deemed to be converted if Class 4 Stocks had been converted to common stocks prior to such Merger, etc., and the Company shall take necessary measures for such adjustments as part of procedures for such Merger, etc., and shall not engage in the Merger, etc. without taking such measures.
(2) When Class 4 Stock is split or consolidated, the conversion price of Class 4 Stock shall be adjusted corresponding to the ratio of such split or consolidation, and the amount equivalent to a fractional share less than one share shall not be converted where cash will be paid at the issuance of stock certificate.
(3) When the Company conducts the capital increase with/without considerations or pays dividends at the issuance price per share, conversion price or exercising price lower than the existing conversion price or issues stock-related bonds convertible or exchangeable with the stock of the Company, the conversion price shall be adjusted by the same method.
Conversion price following adjustments = conversion price prior to adjustments x {the number of stocks previously issued + (the number of stocks newly issued x issuance price per share/conversion price prior to adjustments)} ÷ (the number of stocks previously issued + the number of stocks newly issued)
From the formula above, (i) the “number of stocks previously issued” shall be the total number of stocks issued as of the date immediately before the grounds for adjustments arise in the given year, (ii) the “number of stocks newly issued” shall means the number of stock actually issued or the number stocks issued to the holders of bonds or holders of subscription rights to new stocks by exercising the conversion right or subscription right to new stocks in cases where convertible bonds or bonds with warrants are issued, and (iii) the “issuance price per share” shall be zero (0) in cases of capital increase without consideration or dividend payout, and shall mean the conversion price or exercising price in cases where convertible bonds or bonds with warrants are issued. Following the adjustments according to the formula above, the conversion price below KRW unit shall be discarded.

(B) Value adjustments: The conversion price shall be adjusted according to the formula below when the adjusted amount below arises:

Adjusted conversion price = A * B / (A - X)

X = (Adjusted amount due to the grounds of Daewoo Shipbuilding – Preferred dividend amount reduced (up to \62.5 billion KRW) – the amount multiplying \25 billion KRW by the years passed from the redemption deadline until the time of exercising) – Adjusted amount for the grounds of the Company
A = Total amount of issuance price of Class 4 Stock, \1,250,000,051,328 KRW
B = Issuance price per share of Class 4 Stock, \137,088 KRW: Provided that in cases of dilutive adjustments under (A) above, it shall mean the conversion price following such adjustments.