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December 1, 2000 Ocean Rig and FGH in Bingo cooperation pact Ocean Rig ASA and Friede Goldman Halter, Inc. have executed a cooperation agreement on the completion and delivery of Ocean Rig’s Bingo 9000-1 and Bingo 9000-2 offshore drilling rigs. The rigs are currently being outfitted at Friede Goldman’s Pascagoula, Mississippi shipyard .As of November 12, 2000, Bingo 9000-1 was 95% completed, and Bingo 9000-2 was 79% completed. The agreement establishes new delivery dates for the rigs, with a delivery date for Bingo 9000-1 set for March 1, 2001, and a delivery date for Bingo 9000-2 set for June 1, 2001. These delivery dates are within the range previously determined by ABB Offshore Systems AS, former Umoe Olje og Gass AS, the independent firm hired in January, 2000 by the two companies to monitor and evaluate, on an ongoing basis, the completion of the two rigs. As an indication of its commitment to meet these delivery dates, Friede Goldman has agreed that it will pay liquidated damages to Ocean Rig if the rigs are delivered later than these dates, at a rate of $75,000 per day per rig, to a maximum of $7.5 million per rig. The agreement also includes an early completion bonus of $1 million per rig, payable to Friede Goldman if the rigs are delivered to Ocean Rig prior to the new delivery dates. In exchange, under the agreement, each company has agreed, with certain specific exceptions, to withdraw all claims between the two companies as of the date of this agreement, including any actual or potential change claims within Friede Goldman’s knowledge as of the date of the agreement, and Ocean Rig’s entitlement to liquidated damages for previous delays. The agreement contains several incentives to ensure timely completion and delivery of the two rigs. For example, Ocean Rig has agreed to allocate additional funds to the project for targeted critical-path activities, such as the installation of certain electrical equipment. The agreement also includes a specific incentive plan targeted to the completion of Bingo 9000-2. According to this plan, Ocean Rig will pay an incentive bonus of up to a total of $5 million to Friede Goldman if Friede Goldman meets certain predetermined progress targets at the end of each calendar month between now and April 15, 2001. As a key element of the agreement, Friede Goldman on its part has agreed to waive any and all claims to detain either of the rigs at the yard once it has been determined that the rigs are ready to leave quayside for sea-trials. Under the terms of the agreement, the two companies will jointly determine when the rigs are ready to leave quayside--a crucial step in the preparation of the rigs for final delivery to Ocean Rig. News index Marine Log Home page