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October 9, 2002

New Color Lines ferry

Kvaerner Masa-Yards extends deadline for Color Line order
Color Line AS of Norway and Kvaerner Masa-Yards have agreed to extend the validity of a letter of intent signed in July 2002.

The signing of the final contract has been delayed because the financing of the vessel is pending the outcome of the Norwegian budget proposal of October 3, 2002. The key outstanding issue realtes to changes in the net wage scheme for Norwegian seamen, to bring it into line with those of other Nordic and European countries.

Under the letter of intent Color Line will purchase and Kvaerner Masa-Yards will design, build and deliver one cruise passenger ferry of about 74 500 gross tonnes.

The extended letter of intent is subject to finalization of the financing, Color Line is confident this can be arranged if the Norwegian Parliament and the Norwegian Government approve a long-term net wage scheme similar to the system in Sweden or Denmark. The vessel could start operation under the Norwegian flag for the 2004 Christmas season.

The parties have agreed on the general arrangements and specifications of the vessel. The value of the vessel is about $300 million. The letter of intent includes an option to purchase a sister vessel.

Color Line and Kvaerner Masa-Yards say they are continuing to "work on an exclusive basis towards signing the final shipbuilding contract by December 16, 2002."

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