EXHIBIT 10.2

SECOND AMENDMENT TO
SECOND AMENDED AND RESTATED CREDIT AGREEMENT

          THIS SECOND AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT,
dated as of October 24, 2005 (this “Amendment”), is entered into by and among
U.S. SHIPPING PARTNERS L.P., a Delaware limited partnership, U.S. SHIPPING
OPERATING LLC, a Delaware limited liability company, ITB BALTIMORE LLC, a
Delaware limited liability company, ITB GROTON LLC, a Delaware limited liability
company, ITB JACKSONVILLE LLC, a Delaware limited liability company, ITB MOBILE
LLC, a Delaware limited liability company, ITB NEW YORK LLC, a Delaware limited
liability company, ITB PHILADELPHIA LLC, a Delaware limited liability company,
USS CHARTERING LLC, a Delaware limited liability company, USCS CHEMICAL
CHARTERING LLC, a Delaware limited liability company, USCS CHEMICAL PIONEER
INC., a Delaware corporation and successor-by-conversion to USCS Chemical
Pioneer LLC, USCS CHARLESTON LLC, a Delaware limited liability company, USCS
CHARLESTON CHARTERING LLC, a Delaware limited liability company, USCS ATB LLC, a
Delaware limited liability company (each of the foregoing being individually
called a “Borrower” and collectively, the “Borrowers”), the various financial
institutions as are or may become parties to the Credit Agreement as defined
hereinafter (collectively, the “Lenders”), CANADIAN IMPERIAL BANK OF COMMERCE
(“CIBC”), as administrative agent (in such capacity together with its successors
in such capacity, the “Administrative Agent”) for the Lenders, CIBC, as letter
of credit issuer (the “Letter of Credit Issuer”), and KEYBANK NATIONAL
ASSOCIATION, as collateral agent (in such capacity, together with its successors
in such capacity, the “Collateral Agent”) for the Secured Parties (as defined in
the Credit Agreement hereinafter defined).

W I T N E S S E T H:

          WHEREAS, the Borrowers, the Lenders, the Letter of Credit Issuer, the
Administrative Agent and the Collateral Agent have entered into that certain
Second Amended and Restated Credit Agreement dated as of November 3, 2004, as
amended by the certain First Amendment to Second Amended and Restated Credit
Agreement dated as of August 1, 2005 (as further amended, restated or otherwise
modified, the “Credit Agreement”).

          WHEREAS, the Borrowers, the Lenders, the Letter of Credit Issuer, the
Administrative Agent and the Collateral Agent intend to amend certain provisions
of the Credit Agreement as set forth herein.

          NOW THEREFORE, in consideration of the foregoing and the mutual
agreements set forth herein, the parties hereto agree as follows:

          SECTION 1.          Definitions.  Unless otherwise defined in this
Amendment, each capitalized term used in this Amendment has the meaning assigned
to such term in the Credit Agreement.

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          SECTION 2.          Amendment of Section 1.1 of the Credit Agreement. 
Section 1.1 of the Credit Agreement is hereby amended as follows:

 

          (a)          The definition of “ATB Contractor” is deleted in its
entirety and replaced with the following text:

 

 

 

 

“          “ATB Contractor” means Southeastern New England Shipbuilding
Corporation d/b/a/ SENESCO Marine, a Delaware corporation, and its successors,
or any other shipyard, in substantially the same business of constructing in the
United States tug barges and other vessels that are designed to transport
petroleum products and chemicals, that has been proposed by the Borrowers and
approved by the Administrative Agent.”;

 

 

 

 

          (b)          The definition of “Charter” is amended by inserting the
text “or each New ATB” immediately after the text “or the ATB”;

 

 

 

          (c)          Clause (f) of the definition of “Indebtedness” is deleted
in its entirety and replaced with the following text:

 

 

 

 

“(f)         whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of property or
services (excluding any obligations of any Borrower, or any wholly-owned
Subsidiary of any Borrower, (i) to the ATB Contractor incurred pursuant to the
ATB Construction Contract or any New ATB Construction Contract or (ii) incurred
pursuant to the Darnell Acquisition Agreement), and indebtedness (excluding
prepaid interest thereon) secured by a Lien on property owned or being purchased
by such Person (including indebtedness arising under conditional sales or other
title retention agreements), whether or not such indebtedness shall have been
assumed by such Person or is limited in recourse; provided, however, that any
agreement to pay for the purchase or construction of one or more vessels and
other assets relating to such vessels upon the delivery of such acquired vessels
where the acquisition of such vessels and related assets are otherwise permitted
under this Agreement, including pursuant to a Vessel Acquisition, shall not be
deemed to be “Indebtedness” hereunder until the earlier of (a) the first date of
delivery of any such vessel or other related asset in accordance with such
agreement or (b) the first date any payment (other than an initial deposit) is
made by any Borrower or Subsidiary for the purchase or construction of such
vessel or other related asset; and”;

 

 

 

          (d)          The definition of Material Charter is amended by adding
the text “each Charter executed after the Closing Date that is effective for a
period equal to or greater than two years,” immediately after the text “each
Investment Grade Charter,”;

 

 

 

          (e)          The following defined terms are inserted in Section 1.1
of the Credit Agreement immediately after the definition for “Net Proceeds” and
immediately before the definition for “New Borrowers”:

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“        “New ATB” means, individually, each new articulated tug-barge vessel
designed to transport chemicals that is to be constructed pursuant to a New ATB
Construction Contract.

 

 

 

 

 

          “New ATB Construction Contract” means each Articulated Tug Barge
Building Agreement or other contract for the construction of a new articulated
tug-barge vessel designed to transport chemicals and petroleum products executed
after the date hereof with the ATB Contractor and in accordance with Section
7.2.15, as amended or otherwise modified from time to time.”;

 

 

 

          (f)       The definition of “Total Fixed Charge Coverage Ratio” is
amended by inserting the text “and each New ATB and Vessels acquired pursuant to
a Vessel Acquisition (including, for clarity, the M/V Gus Darnell)” immediately
after the text “construction of the ATB”;

 

 

 

           (g)       The definition of “Transaction Document” is amended by
inserting the text “each New ATB Construction Contract,” immediately after the
text “the ATB Construction Contract,”;

 

 

 

           (h)       The definition of “Vessel Acquisition” is amended by
inserting the text “and each New ATB” immediately after the text “excluding the
ATB”; and

 

 

 

          (i)       Clause (ii) of the definition of “Vessels” is amended by
replacing the text “the ATB upon its certification,” with the text “the ATB and
each New ATB upon each such vessel’s respective certification,”.

          SECTION 3.          Amendment of Section 4.10 of the Credit
Agreement.  Section 4.10 of the Credit Agreement is hereby amended (a) by
inserting the text “including the payment of construction costs for the ATB
provided that the aggregate amount of the construction costs incurred pursuant
to the ATB Construction Contract does not exceed $53,100,000,” immediately after
the text “permitted Capital Expenditures” in clause (i), and (b) by deleting the
text “in an amount not to exceed $45,600,000” in clause (iii). 

          SECTION 4.          Amendment of Section 7.1.1 of the Credit
Agreement.  Clause (a) of Section 7.1.1 of the Credit Agreement is hereby
amended by inserting the text “and each New ATB Construction Contract”
immediately after the text “pursuant to the ATB Construction Contract”. 

          SECTION 5.          Amendment of Section 7.1.8 of the Credit
Agreement.  Section 7.1.8 of the Credit Agreement is hereby amended (i) by
replacing the text “the ATB, any contracts executed with the ATB Contractor with
respect to the ATB” with the text “the ATB, each New ATB, any contracts executed
with the ATB Contractor with respect to the ATB or any New ATB” and (ii) by
inserting the text “, deliver a Third Party Consent, substantially in the form
of Exhibit K-2, duly executed and delivered by the respective charterer, with
respect to each Material Charter executed after the Closing Date, not later than
180 days immediately following the execution of such Material Charter”
immediately after the text “equipment, chattel paper, and instruments”.

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          SECTION 6.          Amendment of Section 7.2.2 of the Credit
Agreement.  Clause (e) of Section 7.2.2 of the Credit Agreement is hereby
deleted in its entirety and replaced with the following text:

 

“(e)          Indebtedness in respect of Capitalized Lease Liabilities to the
extent permitted by Section 7.2.7; provided such Capitalized Lease Liabilities
do not, and will not, result from the acquisition of any vessels pursuant to a
Vessel Acquisition;”.

          SECTION 7.          Amendment of Section 7.2.7 of the Credit
Agreement.  Clause (a) of Section 7.2.7 of the Credit Agreement is hereby
amended (i) by inserting the text “or any New ATB” immediately after the text
“expenditures for the ATB” and immediately before the text “, expenditures for
the purchase of the M/V Gus W. Darnell pursuant to the Darnell Acquisition
Agreement and refurbishment of the M/V Gus W. Darnell in an amount not to exceed
$30,000,000 in the aggregate,”, (ii) by inserting the text “pursuant to a Vessel
Acquisition or” immediately after the text “Vessels constructed or acquired” and
immediately before the text “with the proceeds of any Credit Extensions”, and
(iii) by replacing the text “acquire any Vessel (other than the ATB)” with the
text “acquire any Vessel (other than the ATB or any New ATB) pursuant to a
Vessel Acquisition or”. 

          SECTION 8.          Amendment of Section 7.2.11 of the Credit
Agreement.  Section 7.2.11 of the Credit Agreement is hereby amended by
inserting the text “or any New ATB Construction Contract” immediately after the
text “or the ATB Construction Contract”.

          SECTION 9.          Addition of Section 7.2.15 to the Credit
Agreement.  Article VII of the Credit Agreement is hereby amended by inserting
the following new Section 7.2.15 in the appropriate place: 

 

“          SECTION 7.2.15.          Limitation on Funds Disbursement for
Construction of Each New ATB.  The Borrowers shall not, and shall not permit any
of their respective Subsidiaries to, make any disbursement of funds to the ATB
Contractor for the construction of any New ATB, other than the payment of a
premium in an amount not in excess of $1,000,000 with respect to purchasing an
option to have the ATB Contractor construct each New ATB, unless prior to such
disbursement each of the following conditions shall have been satisfied with
respect to each New ATB:

 

          (a)          one or more of the Borrowers, or a wholly-owned
Subsidiary thereof, shall have entered into a fixed price construction contract,
which may include a fluctuating speed bonus component, with the ATB Contractor
for the construction of such New ATB, with a construction period of no longer
than 24 months and which is otherwise in form and substance reasonably
satisfactory to the Administrative Agent;

 

 

 

          (b)          the Borrowers, or a wholly-owned Subsidiary thereof,
shall have obtained a completion bond, insurance policy, standby letter of
credit, deposit arrangement, or other arrangement, in an amount, upon terms and
from parties that are reasonably satisfactory to the

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Administrative Agent, to assure the timely completion and certification of the
New ATB with such arrangement to be maintained throughout the construction
period; and

 

 

 

          (c)          the Administrative Agent shall have received a consent
and agreement to the assignment and creation of a security interest in the
construction contract with the ATB Contractor for the construction of the New
ATB by the Borrowers, or a wholly-owned Subsidiary thereof, to the Collateral
Agent for the benefit of the Secured Parties of all of the Borrowers’ and its
Subsidiaries’ rights, title and interests in, to and under the relevant New ATB
Construction Contract as security for the Obligations hereunder, duly executed
and delivered by the ATB Contractor.”

          SECTION 10.          Limited Waiver Consent of Section 7.2.12(a) of
the Credit Agreement.  The Lenders, the Administrative Agent, the Letter of
Credit Issuer and the Collateral Agent do hereby consent to a waiver of Section
7.2.12(a) of the Credit Agreement for the limited purpose of permitting an
amendment and other modifications to the ATB Construction Contract that, among
other things, extend the construction completion date of the ATB to November 30,
2006, increase construction costs to be paid by the Borrowers in an amount not
to exceed $7,500,000, and establish a daily penalty rate of $30,000 to be paid
by the ATB Contractor for each day delay in delivery of the ATB beyond November
30, 2006; provided that (i) the terms of such amendment and other modifications
are reasonably satisfactory to the Administrative Agent, and (ii) the
instruments with respect to security supporting the performance of the ATB
Contractor under the ATB Construction Contract are simultaneously amended to
provide terms that are more favorable in the aggregate to the Borrowers than the
existing terms and that are reasonably satisfactory to the Administrative
Agent.  Except as expressly set forth herein, no portion of this Section 10
shall be deemed or interpreted in any way to be a waiver of any provision of the
Credit Agreement or any other Loan Document or of any right, power or remedy
under the Credit Agreement or any other Transaction Document or applicable law.

          SECTION 11.          Ratification.  Each Borrower hereby ratifies and
confirms all of the Obligations under the Credit Agreement and the other Loan
Documents.  This Amendment is an amendment to the Credit Agreement, and the
Credit Agreement as amended hereby, is hereby ratified, approved and confirmed
in each and every respect.

          SECTION 12.          Effectiveness.  This Amendment shall be effective
as of the date first written above, provided that the conditions set forth in
this Section 12 are satisfied:

 

          (a)          The Administrative Agent shall have received duly
executed counterparts of this Amendment from the Borrowers, the Administrative
Agent, the Letter of Credit Issuer, the Collateral Agent and the Majority
Lenders.

 

 

 

          (b)          To induce the Lenders to enter into this Amendment, each
of the Borrowers shall have represented and warranted to the Administrative
Agent, the Letter of Credit Issuer, the Collateral Agent and the Lenders, and by
its execution and delivery of this Amendment such Borrower does hereby represent
and warrant to the Administrative Agent, the Letter of Credit Issuer, the
Collateral Agent and the Lenders,

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that (i) the execution, delivery and performance of this Amendment has been duly
authorized by all requisite corporate action on the part of such Borrower; (ii)
the Credit Agreement and each other Loan Document to which it is a party
constitute valid and legally binding agreements enforceable against such
Borrower in accordance with their respective terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws relating to or affecting
the enforcement of creditors’ rights generally and by general principles of
equity, (iii) the representations and warranties by such Borrower contained in
the Credit Agreement and in the other Loan Documents are true and correct on and
as of the date hereof in all material respects as though made as of the date
hereof, except those that by their terms relate solely as to an earlier date, in
which event they shall be true and correct on and as of such earlier date, and
(iv) no Default or Event of Default exists under the Credit Agreement or any of
the other Loan Documents.

          SECTION 13.          Governing Law; Severability; Entire Agreement. 
THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO ANY CONFLICTS OF LAW
PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER
JURISDICTION).  Any provision of this Amendment or any other Loan Document which
is prohibited or unenforceable in any jurisdiction shall, as to such provision
and such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Amendment
or such Loan Document or affecting the validity or enforceability of such
provision in any other jurisdiction.  This Amendment and the other Transaction
Documents constitute the entire understanding among the parties hereto with
respect to the subject matter hereof and supersede any prior agreements, written
or oral, with respect thereto. 

          SECTION 14.          Execution in Counterparts.  This Amendment may be
executed by the parties hereto in several counterparts, each of which shall be
deemed to be an original and all of which shall constitute together but one and
the same agreement.

          SECTION 15.          Successors and Assigns.  This Amendment shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns; provided, however, that (a) no Borrower may
assign or transfer its rights or obligations hereunder without the prior written
consent of the Administrative Agent, the Letter of Credit Issuer and all
Lenders; and (b) the rights of sale, assignment and transfer of the Lenders are
subject to Section 10.11 of the Credit Agreement. 

          SECTION 16.          Miscellaneous.  (a) On and after the
effectiveness of this Amendment, each reference in each Transaction Document to
“the Credit Agreement”, “thereunder”, “thereof” or words of like import
referring to the Credit Agreement shall mean and be a reference to the Credit
Agreement as amended or otherwise modified by this Amendment; (b) the execution,
delivery and effectiveness of this Amendment shall not, except as expressly
provided herein, operate as a waiver of any default of the Borrower or any
right, power or remedy of the Administrative Agent, the Letter of Credit Issuer,
the Collateral Agent or the Lenders under any of the Loan Documents, nor
constitute a waiver of any provision of any of the Loan Documents; (c) this
Amendment is a Loan Document executed pursuant to the Credit Agreement and shall

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(unless otherwise expressly indicated therein) be construed, administered and
applied in accordance with the terms and provisions of the Credit Agreement; and
(d) a facsimile signature of any party hereto shall be deemed to be an original
signature for purposes of this Amendment.

[Remainder of Page Left Intentionally Blank]

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          IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed by its officers thereunto duly authorized as of the date first above
written.

 

BORROWERS:

 

 

 

 

U.S. SHIPPING PARTNERS L.P.

 

 

 

By:

US Shipping General Partner LLC,

 

 

its General Partner

 

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

U.S. SHIPPING OPERATING LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

ITB BALTIMORE LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

ITB GROTON LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

ITB JACKSONVILLE LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

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ITB MOBILE LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

ITB NEW YORK LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

ITB PHILADELPHIA LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

USS CHARTERING LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

USCS CHEMICAL CHARTERING LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

USCS CHEMICAL PIONEER INC.

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

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USCS CHARLESTON CHARTERING LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

USCS CHARLESTON LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

 

 

 

 

USCS ATB LLC

 

 

 

By:

/s/ PAUL GRIDLEY

 

 

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Name:

Paul Gridley

 

Title:

Chairman and Chief Executive Officer

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AGENTS AND LENDERS:

 

 

 

 

CANADIAN IMPERIAL BANK OF
COMMERCE, as Administrative Agent and
Letter of Credit Issuer

 

 

 

 

 

 

 

By:

 

 

 

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Name:

 

 

Title:

 

 

 

 

KEYBANK NATIONAL ASSOCIATION, as
Collateral Agent and Lender

 

 

 

 

 

 

 

By:

 

 

 

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Name:

 

 

Title:

 

 

 

 

 

 

 

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,

as Lender

 

 

 

 

 

 

 

By:

 

 

 

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Name:

 

 

Title:

 

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