EXHIBIT 10.10

SECOND AMENDMENT TO LOAN AGREEMENT

     This SECOND AMENDMENT TO LOAN AGREEMENT (the “Second Amendment”), dated as
of the 29th day of October, 2004, is made by and between HORIZON VESSELS
INTERNATIONAL, LTD. (“Borrower”), and GENERAL ELECTRIC CAPITAL CORPORATION OF
TENNESSEE (“Lender”).

W I T N E S S E T H:

     WHEREAS, Borrower and Boeing Capital Corporation (“Boeing”) entered into
that certain Loan Agreement dated as of June 30, 2003 (as the same has been or
may hereafter be amended, supplemented or otherwise modified, the “Loan
Agreement”), pursuant to which Borrower agreed to borrow, and Boeing agreed to
lend, upon and subject to the terms thereof, up to the aggregate principal
amount of $35,000,000 (the “Loan”); and

     WHEREAS, pursuant to the Purchase and Sale Agreement among Boeing, BCC
Equipment Leasing Corporation, McDonnell Douglas Overseas Finance Corporation,
Boeing Capital Loan Corporation and General Electric Capital Corporation, dated
as of May 24, 2004, the Lender purchased the Loan Agreement.

     WHEREAS, the parties now desire to modify certain of the terms and
conditions contained in the Loan Agreement.

     NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants and premises contained herein, together with other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto have agreed and do hereby agree as follows:

     1. Capitalized terms used in this Second Amendment (including the recitals
hereof) shall have the meanings assigned to them in the Loan Agreement, as
amended by this Second Amendment.

     2. This Second Amendment becomes effective only upon: (1) the transactions
associated with the funding of additional subordinated debt as set forth in the
additional investment proposal (as described in the Estoppel Certificate
executed by the Lender on an even date herewith) closing on or before November
8, 2004 and (2) the Borrower and Horizon Offshore, Inc. paying to the Lender the
first installment of the fee agreed to by the parties in an amount equal to
one-half percent (0.5%) of the now current outstanding principal balance of the
Loan ($31,428,560.30 as of October 19, 2004).

     3. The Loan Agreement is hereby amended by adding the following definition
to the Definitions section thereof in the correct alphabetical order:

     “Subordinated Debt” means indebtedness of the Parent incurred pursuant to
(a) that certain Purchase Agreement dated March 11, 2004, among the Parent, the
guarantors listed therein and the purchasers listed therein, pursuant to which
those certain 16% subordinated

 

--------------------------------------------------------------------------------

 

secured notes due March 31, 2007, in an aggregated principal amount equal to
$65,400,000.00 were issued, as the same may be amended, supplemented or modified
from time to time, and (b) that certain Purchase Agreement dated May 27, 2004,
among the Parent, the guarantors listed therein and the purchasers listed
therein, pursuant to which (i) those certain 18% subordinated secured notes due
March 31, 2007, in an aggregated principal amount equal to $18,750,000.00 were
issued on May 27, 2004, (ii) those certain additional 18% subordinated secured
notes due March 31, 2007, in an aggregated principal amount equal to
$5,291,865.00 were issued on September 17, 2004, and (iii) those certain
additional 18% subordinated secured notes due March 31, 2007, in an aggregated
principal amount equal to $9,625,000 were issued on November 4, 2004, as the
same may be amended, supplemented or modified from time to time.

     4. The Loan Agreement is hereby amended by amending and restating the
following definitions in their entirety:

     “Cash Interest” means, for any period, the consolidated Interest Expense of
the Parent and its subsidiaries for such period, determined in accordance with
GAAP applied consistently, less (a) interest related to the Subordinated Debt
(which is in fact paid-in-kind) and (b) all amounts included in Interest
Expense, in accordance with GAAP, for amortization of debt fees, discounts and
warrant expense.

     “EBITDA” means for the Parent and its subsidiaries, on a consolidated
basis, for any period, the sum of (a) Net Income before gains and losses on
sales of assets (to the extent such gains and losses are included in earnings),
plus (b) Tax Expense, plus (c) depreciation and amortization (including
accelerated amortization of prepaid loan fees, discounts and warrant expense, as
required by GAAP), plus (d) Interest Expense.

     “EBITDAR” means for the Parent and its subsidiaries, on a consolidated
basis, for any period, the sum of (a) Net Income before gains and losses on
sales of assets (to the extent such gains and losses are included in earnings),
plus (b) Tax Expense, plus (c) depreciation and amortization (including
accelerated amortization of prepaid loan fees, discounts and warrant expense, as
required by GAAP), plus (d) Interest Expense, plus (e) restructuring charges,
including costs of professional advisors to the Parent and its subsidiaries
(including costs of professional advisors to the Parent’s lenders and other
creditors which are required to be paid by the Parent or its subsidiaries).

     “Fixed Charge Coverage Ratio” means for the Parent and its subsidiaries, on
a consolidated basis, (a) as of September 30, 2004, (i) EBITDA for the quarter
ended as of September 30, 2004, divided by (ii) the sum of (A) Current
Maturities of Long Term Debt as of September 30, 2004 divided by four, plus (B)
Cash Interest for the quarter ended September 30, 2004, plus (C) Tax Expense for
the quarter ended as of September 30, 2004, (b) as of December 31, 2004,
(i) EBITDA for the quarters ended as of September 30, 2004 and December 31,
2004, divided by (ii) the sum of (A) Current Maturities of Long Term Debt as of
December 31, 2004 divided by two, plus (B) Cash Interest for the quarters ended
as of September 30, 2004 and December 31, 2004, plus (C) Tax Expense for the
quarters ended as of September 30, 2004 and December 31, 2004, (c) as of March
31, 2005, (i) EBITDA for the quarters ended September 30, 2004, December 31,
2004, and March 31, 2005 divided by (ii) the sum of (A) Current Maturities of
Long Term Debt as of March 31, 2005 times .75 (seventy-five percent), plus (B)
Cash Interest

2

--------------------------------------------------------------------------------

 

for the quarters ended September 30, 2004, December 31, 2004, and March 31,
2005, plus (C) Tax Expense for the quarters ended September 30, 2004 , December
31, 2004, and March 31, 2005, and (d) for all quarters ending thereafter, (i)
EBITDA for the four (4) quarters then ended divided by (ii) the sum of (A)
Current Maturities of Long Term Debt as of the quarter then ended, plus (B) Cash
Interest for the four (4) quarters then ended, plus (C) Tax Expense for the four
(4) quarters then ended.

     “Tangible Net Worth” means, at any particular date, all amounts which, in
conformity with GAAP, would be included as stockholder’s equity on a
consolidated balance sheet of the Parent and its subsidiaries, including without
limitation adjustments for the addition of paid-in-kind interest, discounts and
warrant amortization on Subordinated Debt; provided, however, there shall be
excluded therefrom (a) any amount at which shares of capital stock of the Parent
or any subsidiary appear as an asset on the Parent’s or such subsidiary’s
balance sheet, (b) goodwill, including any amount, however designated, that
represent the excess of purchase price paid for assets or stock over the value
assigned thereto, (c) patents, trademarks, trade names, and copyrights,
(d) loans and advances to any stockholder, director, officer, or employee of the
Parent or any subsidiary or any affiliate, and (e) all other assets which are
properly classified as intangible assets.

     “Total Funded Debt” means, for the Parent and its subsidiaries, on a
consolidated basis, the sum of (a) all indebtedness for borrowed money, whether
or not evidenced by notes, bonds, debentures, notes or similar instruments, (b)
all capital lease obligations, (c) all obligations to pay the deferred purchase
price of property or services (but excluding trade accounts payable or trade
notes in the ordinary course of business), (d) all indebtedness secured by a
Lien on the property of the Parent or any of its subsidiaries, and (e) all
letter of credit liabilities.

     5. It is further understood and agreed by and among the parties hereto that
all terms and conditions of the Loan Agreement, except as herein modified, shall
remain in full force and effect.

     6. Borrower hereby represents and warrants to Lender that each of the
representations and warranties of Borrower contained in the Note, Loan Agreement
and each of the other Loan Documents to which it is a party are true, correct
and complete as of the date hereof and apply to the execution and delivery of
this Second Amendment and any other documents executed in connection herewith.

     7. Borrower hereby acknowledges, confirms and warrants to Lender that as of
the date of this Second Amendment, it has no defenses, claims, rights of set-off
or counterclaims against Lender under, arising out of, or in connection with
this Second Amendment, the Loan, the Loan Agreement or the other Loan Documents
to which it is a party or against any of the indebtedness evidenced, advanced or
secured thereby, any and all of which Borrower hereby expressly waives.

     8. In consideration of Lender executing this Second Amendment, Borrower
hereby unconditionally and irrevocably fully releases, acquits, settles, and
discharges any and all claims, counterclaims, liabilities, damages, defenses,
demands and causes of action that Borrower have or may have against Lender, its
respective officers, directors, trustees, agents,

3

--------------------------------------------------------------------------------

 

employees, attorneys, successors and assigns (collectively, the “Released
Parties”), whether or not acting in their official capacity with respect to the
Lender, in their personal capacity or in any other capacity, related to or that
may have arisen, may arise or are or become assertable as a result of events
occurring in connection with the Loan and the Loan Documents, together with any
and all negotiations, discussions, acts, omissions, renewals, extensions,
collateral documents, and other agreements and actions related thereto,
including any claims, causes of action or defenses based on the negligence of
Lender or any of the Released Parties or on any other “lender liability”
theories of, among others, bad faith, unfair dealing, duress, coercion, control,
misrepresentation, omissions, misconduct, overreaching, unconscionability,
disparate bargaining position, reliance, equitable subordination, fraud, or
otherwise, and do hereby intend to release, compromise and settle and such
claims and matters, whether known or unknown, whether reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured and whether they arose
collaterally, directly, derivatively or otherwise between Borrower and the
Released Parties from the beginning of the world to and including the date of
this Amendment (collectively the “Released Claims”). Borrower hereby represents
and warrants to Lender that Borrower is presently the legal owner and holder of
any and all of the Released Claims and that Borrower has not heretofore
expressly or impliedly assigned, transferred, pledged, hypothecated sold,
conveyed or otherwise disposed of, for the benefit of creditors or otherwise,
any of the Released Claims.

     9. Borrower acknowledges and agrees that the Mortgage constitutes a valid
first lien upon the mortgaged property in favor of Lender and that the Loan
Documents constitute valid and binding agreements of obligations of the parties
thereto with respect to the Loan. The mortgaged property is and shall remain
subject to and encumbered by the lien, charge and encumbrance of the Mortgage
and nothing herein shall affect or be construed to affect the lien, charge or
encumbrance of the Mortgage or the priority hereof over other liens or
encumbrances. Borrower acknowledges and agrees that the Mortgage constitutes and
continues to be a valid first mortgage lien and security interest upon the
mortgaged property in favor of Lender, subject only to permitted encumbrances as
provided in the Loan Agreement. Nothing herein is intended to, nor shall it,
constitute a novation of the indebtedness secured by the Mortgage or other Loan
Documents.

     10. This Second Amendment shall inure to the benefit of, and shall be
binding upon, the parties hereto and their respective successors and permitted
assigns under the Loan Agreement.

     11. Each party hereto agrees promptly to do, make, execute and deliver all
such additional and further acts, things, deeds, assurances, instruments and
documents as the other party may reasonably request to vest in and assure to the
requesting party its rights (and/or to confirm the agreements and obligations of
the non-requesting party) hereunder or under any of the Loan Documents. Without
limitation of the foregoing, each party agrees to provide such assurances
concerning the effectiveness of this Second Amendment as the other party may
reasonably request.

     12. This Second Amendment may be executed in multiple counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

4

--------------------------------------------------------------------------------

 

     IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to
be duly executed as of the day and year first above written.

              BORROWER:   LENDER:
 
            HORIZON VESSELS INTERNATIONAL, LTD.   GENERAL ELECTRIC CAPITAL
CORPORATION OF TENNESSEE
 
By:
  /s/ DAVID W. SHARP   By:   /s/ JOHN J. MCMONAGLE

 

--------------------------------------------------------------------------------

       

--------------------------------------------------------------------------------

  Name: David W. Sharp   Name: John J. McMonagle Title: Executive Vice President
  Title: Senior Risk Manager
 
            GUARANTORS:        
 
            HORIZON OFFSHORE, INC.        
 
           
By:
  /s/ DAVID W. SHARP        

 

--------------------------------------------------------------------------------

          Name: David W. Sharp         Title: Excutive Vice President        
 
            HORIZON VESSELS, INC.                      
By:
  /s/ DAVID W. SHARP        

 

--------------------------------------------------------------------------------

          Name: David W. Sharp         Title: Executive Vice President        

5