EXHIBIT 10.3

AMENDMENT NO. 3

TO

ARTICULATED TUG BARGE BUILDING AGREEMENT

FOR HULL NO. 046

          AMENDMENT No. 3 made as of this 8th day of November, 2005 to that
certain Articulated Tug Barge Agreement dated August 7, 2004, Contract No. 046
(the “Agreement”), as amended by letter agreements dated August 7, 2004
(Agreement Amendment No. 1) and September 29, 2004 (Agreement Amendment No. 2)
respectively, by and between Southeastern New England Shipbuilding Corporation,
d/b/a SENESCO Marine, a Delaware corporation with its principal place of
business at 10 MacNaught Street, North Kingstown, Rhode Island 02852 (“SENESCO”)
and USCS ATB LLC, a New Jersey limited liability company with its principal
place of business c/o USS Vessel Management, Inc., PO Box 2945, Edison, New
Jersey, 08818-2945 (“Buyer”).

W I T N E S S E T H:

          WHEREAS, SENESCO and the Buyer have entered into the Agreement
providing for the construction by SENESCO for the Buyer of an Articulated Tug
Barge, designated as Hull No. 046, with a capacity of 140,000 BBL (at
98 percent) ABS Class A1 (E) Chemical Petroleum Barge with a guaranteed
deadweight of 19,999 LT, bearing Hull No. 046 (the “ATB”);

          WHEREAS, SENESCO and the Buyer wish to further amend the Agreement as
hereinafter set forth.

          NOW, THEREFORE, it is hereby agreed between SENESCO and the BUYER, as
follows:

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1.

The Summary of Terms is hereby amended, as follows:

 

 

 

 

 

 

 

a.

In Section 4, after “This Agreement,” there shall be added: “as modified by
Agreement Amendments Nos. 1 and 2 and this Amendment No. 3. (hereinafter, the
“Agreement”).”

 

 

 

 

 

 

 

b.

In Section 6, the Delivery Date of March 1, 2006 is hereby changed to November
30, 2006.

 

 

 

 

 

 

 

c.

Section 7 is hereby amended to read:

 

 

 

 

 

 

 

 

 

Total Project Cost:  $51,636,619 made up of a barge unit (the “Barge”) and
pusher tug (the “Tug” or “Pusher Tug”) of $44,672,690 and Buyer Furnished
Equipment of $6,963,929, as adjusted for changes.

 

 

 

 

 

 

 

 

 

Purchase Price:  $44,672,690 (the “Amended Purchase Price”

 

 

 

 

 

 

 

 

 

Total Project Cost net of Buyer Furnished Equipment and Services, as adjusted
(“Buyer Furnished Equipment” or “BFE&S”).

 

 

 

 

 

 

 

 

 

Progress Payments to be made in accordance with Milestone Payment Schedule, as
amended (the “Amended Milestone Payment Schedule”) (Appendix 3a attached hereto
for Barge and Tug).

 

 

 

 

 

 

 

 

 

Production to be accomplished in accordance with Production Schedule, as amended
(the “Amended Production Schedule”) (Appendix 3b attached hereto).

 

 

 

 

 

 

 

d.

Section 9 is hereby amended to read “Amended Barge Letter of Credit (Appendix
4a) and Amended Tug Letter of Credit (Appendix 8a), the forms of which are
attached hereto.”

 

 

 

 

 

 

 

e.

Section 11 is hereby amended to read:

 

Barge:

Quonset Point, Rhode Island,

 

 

 

 

 

Bridgeport, Connecticut

 

 

 

 

 

Sparrows Point, Maryland

 

 

 

 

Tug:

Quonset Point, Rhode Island

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f.

Section 15 is hereby amended to read:

 

 

 

 

 

 

 

 

 

 

Notifications to SENESCO:

 

 

 

 

 

 

 

 

 

 

 

Mr. Frederick G. Frost, III

 

 

 

 

 

Acting Chief Executive Officer

 

 

 

 

 

SENESCO

 

 

 

 

 

10 MacNaught Street

 

 

 

 

 

North Kingstown, RI 02852

 

 

 

 

 

 

 

 

 

 

 

Tel:      (401) 295-0373

 

 

 

 

 

Fax:     (401) 294-4140

 

 

 

 

 

Email:  ffrost@SenescoMarine.com

 

 

 

 

 

 

 

 

g.

Section 16 is hereby amended to read:

 

 

 

 

 

 

 

 

 

 

Description of ATB & Classification Requirements (Appendix 5)

 

 

 

 

 

 

 

 

 

Amended Milestone Acceptance (Appendix 6a)

 

 

 

 

 

 

 

 

 

ATB (Tug & Barge) Certification (Appendix 7)

 

 

 

 

 

 

 

 

 

BFE&S Insurance (Appendix 9)

 

 

 

 

 

 

 

 

 

Construction Transfer Insurance (Appendix 10)

 

 

 

 

 

 

 

 

 

 

Major Costs of Construction Transfer (Appendix 11)

 

 

 

 

 

 

 

 

 

 

Appendices 6a, 9, 10, and 11 are attached hereto.

 

 

 

 

 

 

 

2.

Article 1.c.(i) is hereby amended to read:

 

 

 

 

 

 

 

 

 

 

This Agreement including any amendments;

 

 

 

 

 

 

 

3.

Article I(e) is hereby amended to read:

 

 

 

 

 

 

 

 

 

 

Place of Construction.  The Barge unit has been and will continue to be
constructed by SENESCO at its shipyard located in Quonset Point, Rhode Island
(the “SENESCO Shipyard”) to the extent technically reasonable, including panel
lines, until such time as SENESCO shall commence the transfer of the Barge
sections and components and BFE&S (the “Construction Transfer”) to the former

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Baltimore Marine Industries shipyard at Sparrows Point, Maryland (“Sparrows
Point”) for completion of the Barge (the “Construction Transfer Date”);
provided, however, that the bow assembly (“Bow Assembly”) of the Barge shall
continue to be constructed by Derecktor Shipyards Conn. LLC (“Derecktor”) at
Derecktor’s facility in Bridgeport, Conn., and upon completion of the Bow
Assembly, it shall be transported to Sparrows Point for joining with the balance
of the sections of the Barge, all within the Purchase Price and at the sole
risk, cost, and expense of SENESCO.  The Tug will continue to be built at
Quonset Point, Rhode Island.

 

 

 

 

 

 

 

 

 

 

SENESCO may subcontract painting of the Barge, which work, to the extent
underway, will be performed at the SENESCO Shipyard until the completion of the
Construction Transfer and then at Sparrows Point.  Other than the above, and
except as to subcontracts pertaining to the Construction Transfer, SENESCO may
not enter into subcontracts in excess of $100,000 aggregate per subcontractor
without submission of the form of each such sub-contract to Buyer and prompt
receipt (i.e., within five (5) U.S. business days of SENESCO’s submission) of
Buyer’s written consent, which shall not be unreasonably withheld.  When
circumstances so require and justify, Buyer shall provide or withhold its
consent within one (1) business day of submission.

 

 

 

 

 

 

 

 

 

 

 

 

 

4.

In Article I(f), is hereby amended to read:

 

 

 

 

 

 

 

 

 

 

BFE&S.  SENESCO will provide, at the SENESCO Shipyard and at Sparrows Point,
clean, dry and protected storage and appropriate insurance for BFE&S (Appendix
9) from the time of receipt thereof until time of actual installation in the
ATB’s hull and SENESCO will provide foundations, power wiring, installation
services, all labor, materials, equipment and services to install and test all
equipment (Buyer and SENESCO supplied) in accordance with the Agreement, as
amended.  (If required by the manufacturer, SENESCO will maintain any BFE&S
prior to delivery of the ATB).  BFE&S for the Tug shall be timely delivered by
Buyer to Quonset Point, and BFE&S for the Barge will be timely delivered to
SENESCO Shipyard prior to the Construction Transfer Date and after such date to
Sparrows Point.  Buyer shall not make any substitutions or changes in the BFE&S
without

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SENESCO’s consent, which consent shall not be unreasonably withheld.  The Tug,
upon completion at SENESCO Shipyard, shall be timely delivered to Sparrows Point
for sea trials with the Barge unit at the sole cost, risk, and expense of
SENESCO.

 

 

 

 

 

 

 

5.

Article I(i) is hereby amended to read:

 

 

 

 

 

 

 

 

 

 

To secure its obligations to build the ATB hereunder, SENESCO shall, on such
terms, conditions and amounts satisfactory to the Buyer and customary in
transactions of this type and size, purchase and furnish two amended irrevocable
standby Letters of Credit (“Amended Letters of Credit”).  One Amended Letter of
Credit will apply to the construction of the Barge, and be in the amount of
$15,000,000 (Fifteen Million Dollars) issued by the Bank of America (the
“Amended Barge Letter of Credit”) in the form annexed hereto as Appendix 4a. 
The second Amended Letter of Credit will apply to the construction of the Tug,
and be in the amount of $3,000,000 (Three Million Dollars) issued by the Bank of
America (the “Amended Tug Letter of Credit”) in the form annexed hereto as
Appendix 8a.  Each Amended Letter of Credit will be issued by the Bank of
America as security for the faithful performance of this Agreement.  The Amended
Barge Letter of Credit will be limited to the following three draw events
(“Barge Draw Events”):

 

 

 

 

 

 

 

 

 

(i) the payment of any and all liquidated damages as provided in Article IV(b)
hereof;

 

 

 

 

 

 

 

 

 

(ii) the payment of all costs incurred by Buyer to complete the construction of
the ATB at SENESCO or Sparrows Point or a facility other than such facilities;
and

 

 

 

 

 

 

 

 

 

(iii) receipt of notice that the issuing bank as of the fifteenth day prior to
the expiry of the Amended Barge Letter of Credit has elected not to renew the
Amended Barge Letter of Credit and SENESCO or Applicant, as named in the Letter
of Credit, has not delivered a replacement Amended Barge Letter of Credit as set
forth in Appendix 4a.

 

 

 

 

 

 

 

 

 

The Amended Tug Letter of Credit shall be limited to the following two draw
events (“Tug Draw Events”):

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(i) payment of additional costs occasioned by completion of the Tug at SENESCO,
or at a facility other than SENESCO, and also for the payment to all persons
performing labor on the Tug pursuant to this Agreement and furnishing materials
in connection therewith and excepting costs related to Buyer Furnished Equipment
(other than installation, packing and shipping to another facility to complete
the Tug); and

 

 

 

 

 

 

 

 

 

(ii) receipt of notice that the issuing bank as of the fifteenth day prior to
the expiry of such has elected not to renew the Amended Tug Letter of Credit and
SENESCO or Applicant, as named in the letter of credit, has not delivered a
replacement letter of credit as set forth in Appendix 8a.

 

 

 

 

 

 

 

 

 

The costs for the Amended Barge Letter of Credit and the Amended Tug Letter of
Credit shall be solely for Buyer’s account and expense (it being understood that
if Buyer draws upon either or both letters of credit it is not responsible for
paying such amounts to the bank) and the Amended Barge Letter of Credit and
Amended Tug Letter of Credit shall expire upon acceptance and transfer of title
of the ATB.

 

 

 

 

 

 

 

 

 

SENESCO acknowledges that the Amended Barge Letter of Credit and Amended Tug
Letter of Credit will be assigned to lender for Buyer and Guarantor.

 

 

 

 

 

 

 

 

 

In the event Buyer draws upon either the Amended Barge Letter of Credit or
Amended Tug Letter of Credit because the issuing bank has provided notice that
either or both will expire without replacement, Buyer shall deposit all proceeds
therefrom in an interest bearing escrow account with one of its lenders and no
funds may be taken therefrom except to the extent SENESCO defaults and Buyer
incurs additional costs to complete the ATB as described above and in addition,
but with respect to proceeds from the Amended Barge Letter of Credit only, for
payment of liquidated damages under Article IV(b) of this Agreement.

 

 

 

 

 

 

 

 

 

Upon acceptance and delivery of the completed Barge and all of “Builder’s
Property” (as hereinafter defined) to Buyer, in accordance with the Agreement
and applicable laws and regulations, or the confirmation by the United States
District Court for the Southern District of New York of an arbitration award, if
any, or in the event of

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SENESCO’s default, or the completion of the Barge at Sparrows Point or any other
facility, whichever is later, Buyer shall forthwith pay over to Malcolm G.
Chace  or any other applicant for the Amended Barge Letter of Credit, all
proceeds drawn upon under the Amended Barge Letter of Credit in excess of those
to which Buyer shall be or shall have been entitled by reason of any or all of
Barge Draw Events (i) through (ii).

 

 

 

 

 

 

 

 

 

Upon delivery of the completed Tug to Buyer in accordance with the Agreement and
applicable laws and regulations, or the confirmation by the United States
District Court for the Southern District of New York of an arbitration award, if
any, or in the event of default by SENESCO with respect to the completion of the
Tug at SENESCO, Derecktor or at another facility, Buyer shall forthwith pay over
to Malcolm G. Chace all proceeds drawn upon the Tug Letter of Credit, in excess
of those to which Buyer shall be or shall have been entitled by reason of Tug
Draw Event (i).  Malcolm G. Chace shall be a third party beneficiary of this
covenant by Buyer and shall be entitled to enforce his rights directly against
Buyer hereunder.

 

 

 

 

 

 

 

 

 

All references in the Agreement to “Fleet Bank/Bank of America” shall in the
case of the Amended Barge Letter of Credit and the Amended Tug Letter of Credit
referred to herein shall be deemed to refer to the Bank of America or any
successor.

 

 

 

 

 

 

6.

Article II(a) is hereby amended to read:

 

 

 

 

 

 

 

 

 

Amended Purchase Price.  The Buyer shall pay the sum of $44,672,690 (Forty-Four
Million Six Hundred Seventy-Two Thousand Six Hundred Ninety Dollars) as the
Amended Purchase Price to SENESCO for the design and construction of the Barge
and the Tug and in consideration of SENESCO’s installation of BFE&S.  The
estimated cost of BFE&S is $6,963,929.00 (Six Million Nine Hundred Sixty-Three
Thousand Nine Hundred Twenty Dollars), as adjusted.  The Total Project Cost for
the Barge, the Tug and the BFE&S is accordingly $51,636,619 (Fifty-One Million
Six Hundred Thirty-Six Thousand Six Hundred Nineteen Dollars).

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7.

The first sentence of Article II(b) is hereby amended to read:

 

 

 

 

 

 

 

 

 

Buyer will pay SENESCO the Amended Purchase Price in accordance with the Amended
Milestone Payment Schedule included as Appendix 3a which shall incorporate,
among other things: (a) additional Milestone Payments of $7,000,000 (Seven
Million Dollars) to reflect the Amended Purchase Price.  All such additional
Milestone Payments shall be deemed part of the Amended Purchase Price as
provided in Article II(a) hereof and Section 7 of the Summary of Terms, as
amended, and shall not be treated as Change Orders for purposes of the
application Article II (k) hereof.  If at the time of the submission of the
Amended Milestone Acceptance for Undocking as set forth in the Amended Milestone
Payment Schedule (Appendix 3a), any production task shall not have been
completed in the way of any of the integrity of the structural steel, the
internals and deck steelwork and the application of all coatings (an
“Uncompleted Task”), Buyer shall be entitled to withhold such Milestone Payment,
as set forth in Appendix 3a, until such Uncompleted Task shall have been
completed in accordance with this Agreement.

 

 

 

 

 

 

8.

Article II(e) of the Agreement is amended to add the following:

 

 

 

 

 

 

 

 

 

In arriving at their agreement to increase the Purchase Price by $7,000,000
(Seven Million Dollars) in this Amendment No. 3, Buyer has represented that the
painting required by the Agreement and the Scope Documents (the “Paint Work”)
for the Barge can be performed for $3,198,950 (Three Million One Hundred
Ninety-Eight Thousand Nine Hundred Fifty Dollars).  In the event SENESCO is
unable to renegotiate its agreement with its prospective subcontractor to
perform the Paint Work for a price not exceeding the $3,198,950, Buyer shall
provide a separate Paint Subcontractor (the “Buyer Designated Paint
Subcontractor”) and shall guarantee the performance and the price of Paint Work
by the Buyer Designated Paint Subcontractor in accordance with  the Amended
Production Schedule and SENESCO shall contract with the Buyer Designated Paint
Subcontractor to perform the Paint Work.

 

 

 

 

 

 

 

 

 

If the Buyer Designated Paint Subcontractor shall fail to perform the Paint Work
for $3,198,950 and/or the Paint Work shall fail to conform to the Agreement and
Scope Documents for Paint Work, Buyer shall be responsible to

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pay SENESCO the difference between $3,198,950 and the cost of completion of the
Paint Work and shall be subrogated to all rights of SENESCO with respect to the
enforcement of its rights under its subcontract with the Buyer Designated Paint
Contractor in the name and stead of SENESCO.

 

 

 

 

 

 

 

 

 

For the avoidance of doubt, the Scope Documents shall be deemed to provide in
respect of Section 8 of the Specifications for the Barge, COATINGS AND MARKINGS
and the Material Protection Plan, Change Order #046-02 that:

 

 

 

 

 

 

 

 

 

 

 

 

 

a)

Sherwin Williams will be the paint supplier for all tanks and surface areas
except the cargo tanks;

 

 

 

 

 

 

 

 

 

 

 

 

 

b)

ICI will be the paint supplier for the cargo tanks; and

 

 

 

 

 

 

 

 

 

 

 

 

 

c)

The paint shall be applied using staging.

 

 

 

 

 

 

 

 

 

9.

Article II(i) is hereby amended to add the following:

 

 

 

 

 

 

 

 

 

 

 

 

SENESCO and Buyer agree that all references in this Agreement, as amended, to
“Sparrows Point” shall mean that certain shipyard now owned by SPS Limited
Partnership LLLP and operated by BWI Sparrows Point LLC.  SENESCO undertakes and
warrants that Sparrows Point is located in a Foreign Trade Zone, i.e., FTZ
#74A.  In the event that Sparrows Point for any reason lacks such designation,
SENESCO agrees to hold harmless, indemnify and/or reimburse Buyer for any and
all sales, use or other taxes, or Customs duties or government imposts of any
kind applicable to the Tug and/or the Barge and/or BFE&S by reason of the
absence of any Foreign Trade Zone benefits.

 

 

 

 

 

 

 

 

 

10.

Article II(k) of the Agreement is amended to add the following paragraph:

 

 

 

 

 

 

 

 

 

 

 

 

None of the changes provided by this Amendment No. 3, including the increase of
$7,000,000 (Seven Million Dollars) to comprise the Amended Purchase Price, or
any of the new milestones added to Appendix 3 to comprise Appendix 3a shall be
deemed to be a Change Order for purposes of the application of this Article
II(k).

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11.

Article III(a) of the Agreement is hereby amended to add the following:

 

 

 

 

 

 

 

 

 

Prior to the date of this Amendment No. 3, SENESCO shall have furnished Buyer
with the form of proposed agreement with Sparrows Point and the execution of
this Amendment No. 3 shall be deemed to signify Buyer’s approval thereof.

 

 

 

 

 

 

 

 

 

Within thirty (30) days after the Construction Transfer Date, SENESCO will
obtain the written waiver or release of lien or consent of any and all
lienholders, mortgagees, subcontractors, and materialmen, having in the
aggregate individual contracts or liens of any kind in the amount of $100,000 or
more to the Construction Transfer and the dispatch of the Tug to Sparrows Point
for purposes of sea trials.  The written waiver of lien or consent shall be in
form reasonably satisfactory to Buyer’s counsel.  SENESCO will further perform
any acts reasonably requested by Buyer and execute any and all documents
required to record Buyer’s lien encumbering the ATB, including BFE&S, in the
State of Rhode Island and Town of North Kingston, Rhode Island; the State of
Maryland and City of Baltimore; and the State of Delaware and County of Kent;
and SENESCO hereby authorizes Buyer to file any and all documents, instruments,
and writings necessary or desirable for Buyer to perfect such lien.  In the
event that any lienholders, mortgagees, subcontractors, and materialmen having a
secured interest in the “Work in Progress,” as hereinafter defined,
(collectively, a “lienholder”) shall refuse to release its lien or consent to
the Construction Transfer, Buyer shall have the right to apply any Milestone
Payment or a portion thereof to satisfy or bond the claim of such lienholder.

 

 

 

 

 

 

12.

Article III(b) is hereby amended to provide for delivery of the ATB to Buyer at
Sparrows Point, as follows:

 

 

 

 

 

 

 

 

 

SENESCO warrants that Sparrows Point has sufficient water depth to assure access
in a fully laden condition of the ATB to navigable waters in the open sea.

 

 

 

 

 

 

13.

Article III(d) is hereby amended to add in the fifth line after “any” the word
“remaining.”

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14.

Article IV(a).  The Delivery Date is hereby amended to November 30, 2006.

 

 

 

 

 

 

15.

Article IV(b) is hereby amended to read:

 

 

 

 

 

 

 

 

 

Liquidated Damages.  In case of any delay in delivery of the ATB and said delay
is not excused or relieved under provision of this Agreement, as amended,
SENESCO agrees to pay Buyer from the Amended Barge Letter of Credit as
liquidated damages (“Liquidated Damages”) for delay of delivery at the following
rate: $30,000 (Thirty Thousand Dollars) per day for each of the first sixty six
(66) calendar days of unexcused or unrelieved delay to a maximum of $1,980,000
(One Million Nine Hundred Eighty Thousand Dollars).  At any time, Buyer may draw
from the Amended Barge Letter of Credit for any amount of Liquidated Damages
then due and owing.  Thereafter, Buyer shall be entitled to draw on the Amended
Barge Letter of Credit for the aggregate of all costs incurred by Buyer to
complete the construction of the ATB at SENESCO or Sparrows Point or a facility
other than such facilities in accordance with the plans and specifications
accepted by the parties.

 

 

 

 

 

 

 

 

 

 

 

16.

The first sentence of Article IV(c) is amended to read as follows:

 

 

 

 

 

 

 

 

 

c.  Permissible Delay.  Notwithstanding the Delivery Date, SENESCO shall not be
liable for any default hereunder or delay in the construction of the ATB, or the
performance of the terms, covenants and conditions on its part to be performed
hereunder, if such default, delay or non-performance are caused by or are due to
any occurrence or contingency beyond SENESCO’s control or are caused by the
delay or default or non-performance of any supplier or manufacturer, other than
the Tug manufacturer, with whom SENESCO may contract to furnish and/or deliver
any materials, equipment, machinery or labor necessary in the construction of
the ATB (provided that SENESCO has ordered such materials, equipment, machinery
or labor in a timely manner), including force majeure, wars, sabotage, bombing,
fires, strikes, riots, floods, insurrection, earthquakes, Acts of God, weather
severe enough to make impracticable the use of temporary shelters to allow
outside welding or painting, hurricanes, delays in transportation, adverse
weather conditions which preclude the conducting

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of sea trials as described in Article III f., delays by Buyer in granting its
approval for the Construction Transfer to Sparrows Point beyond November 4,
2005, delays which are the consequence of SENESCO’s exercising of its rights
under Article VIII (b), loss of utilities, blockades, embargoes, terrorism acts,
demands or requirements of the United States Government or any State or
political subdivision thereof, or occasioned by command, restraint, condemnation
or acquisition by the United States Government or any political subdivision
thereof; provided, however, that as soon as any such cause is removed and no
longer exists, except as may be herein otherwise set forth, SENESCO shall
thereupon continue, carry on and perform the covenants, conditions of this
Agreement on SENESCO’s part to be performed.  SENESCO shall promptly notify
Buyer in writing within two (2) business days of the occurrence of any event of
force majeure together with a good faith estimate of the possible delay.

 

 

 

 

 

 

 

 

 

 

 

17.

Article IV(d) is hereby deleted in its entirety.

 

 

 

 

 

 

18.

Article V(a) is hereby amended to add in the second line after “SENESCO
Shipyard,” “Sparrows Point and Derecktor.”

 

 

 

 

 

 

 

After the last sentence in said Article, the following shall be added:

 

 

 

 

 

 

 

 

 

Notwithstanding anything herein to the contrary, in the event that the Inspector
shall be in attendance at the SENESCO Shipyard or Sparrows Point or Derecktor
and the Inspector, upon reasonable inquiry, to the SENESCO office at such
location is able to ascertain that the SENESCO Project Manager is available to
confer at such location in the ensuing four (4) hours on any business day, the
Inspector and the Project Manager shall confer as to any alleged nonconformity,
and if they are unable to resolve the matter of the nonconformity at such
meeting, either the Inspector or the SENESCO Project Manager shall request a
further meeting not later than two (2) business days following their initial
meeting, and the Inspector shall furnish to the Project Manager at that time a
written notice of nonconformity as hereinabove provided.

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19.

In Article VII(a)(i), the following shall be added to the end of the
subparagraph:

 

 

 

 

 

 

 

 

 

SENESCO shall not be responsible for any failure of the ATB to meet her
guaranteed speed and consumption performance warranties if such failure results
from the application of ABS safe hull requirements.

 

 

 

 

 

 

20.

In Article VII(b)(iii), the following shall be added at the end of the
paragraph:

 

 

 

 

 

 

 

 

 

The term “Shipyard” shall mean SENESCO’s Rhode Island facility and/or Sparrows
Point and/or Derecktor and there shall be no requirement, unless agreed by the
parties for technical reasons, that both the Tug and the Barge shall each be
taken to the same facility until sea trials.

 

 

 

 

 

 

21.

In Article VIII(a)(viii), the period of stopped work shall be amended to ten
(10) business days in lieu of twenty-one (21) business days, provided, however,
work stopped as a consequence of the Construction Transfer, or for the two week
Christmas facility closing will not constitute a default.

 

 

 

 

 

 

22.

In Article VIII(a) the following shall be added to the end of the subparagraph:

 

 

 

 

 

 

 

 

 

In the event that Buyer elects to arrange for completion of the construction of
the ATB, the Buyer shall endeavor to cause the completion of the construction of
the ATB to be effected in a cost effective and cost efficient manner consistent
with the drawings and specifications accepted by the parties, provided that
nothing herein shall limit or restrict the Buyer’s right to draw from time to
time under the Amended Barge Letter of Credit or the Amended Tug Letter of
Credit, as the case may be, applicable to each vessel, to reimburse the Buyer
for all costs incurred by the Buyer to complete such construction.  To
facilitate completion and to mitigate damages, SENESCO shall transfer, convey
and assign (collectively the “Transfers”) to the Buyer all subcontracts, SENESCO
provided materials, components, equipment and Builder’s Property and all
agreements for use of Sparrows Point (“Work in Progress”).  In the event that
the Work in Progress shall be subject to other liens, encumbrances or other
restrictions on transfers or assignments not previously dealt with herein
(“Restrictive Rights”), SENESCO shall provide any written consents or other
documentation required from the beneficiaries of the Restrictive Rights to
effect such Transfers.

13

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

 

23.

Article XI(g) is hereby amended to read:

 

 

 

 

 

 

 

 

 

(i) Ownership and use of Software, Drawings and Models.  In consideration of the
Amended Purchase Price, within thirty (30) days of the payment of that portion
of the Amended Purchase Price due on execution of this Amendment No. 3, all
plans, specifications and drawings of any kind, including detailed construction
drawings, model basin results and data, all modifications to the original lines
plan and appurtenances to enable the ATB to achieve its Guaranteed Speed, all
ownership or license rights in any models at Hamburg, Germany or elsewhere, all
correspondence, technology and licenses related thereto and all software,
including the N.C. software, whether in hard copy or electronic format to the
extent then completed, partially completed, in development or as and when
developed or completed, (collectively, “Builder’s Property”) shall be conveyed
by SENESCO to Buyer, together with all ownership, copyright and/or license
rights in such Builder’s Property.  SENESCO shall retain copies or duplicate
originals of all of Builder’s Property sufficient to complete and deliver the
ATB.  SENESCO shall convey, deliver and transfer to Buyer all of SENESCO’ right,
title, and interest by way of copyright, license or other reserved rights or by
way of contract, common law or statutory law.  SENESCO shall authorize Buyer to
correspond directly with the model basin entity in Hamburg, Germany.  Upon
conveyance of the Builder’s Property to Buyer, Buyer shall have full and
exclusive use of Builder’s Property to build the ATB or for any other reason,
subject, however, to any retained royalty rights of the naval architect.  In the
event that Builder’s Property shall be subject to a license from any third party
licensor, Buyer shall pay and/or indemnify SENESCO for any and all license fees
and royalties applicable to Buyer’s use and Buyer shall have the right to
negotiate exclusively with such third party licensor to secure a novation or
assignment of such license, and SENESCO shall cooperate fully in such regard and
shall first have paid any license fees applicable thereto.  Following the
acceptance and delivery of the ATB, Buyer, subject to the consent of any third
party licensor, shall have the exclusive use of all the Builder’s Property for
any reason including but not limited to the modification of the ATB or the
design or construction of other vessels.

14

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

 

 

 

 

SENESCO shall warrant that at the time of acceptance and delivery of the ATB,
SENESCO shall have paid all third party providers of Builder’s Property.  If
SENESCO shall be unable to warrant same, or Buyer otherwise determines that such
providers have not been paid for their services, Buyer shall be entitled to make
such payment and either, at Buyer’s sole option, withhold such amounts from the
final installment of the Purchase Price and/or to draw upon the Amended Barge
Letter of Credit as a Barge Draw Event (ii) or upon the Amended Tug Letter of
Credit as a Tug Draw Event (i) for the amount required to satisfy SENESCO’s
obligation under this provision which obligation shall be deemed a cost of
completing the ATB.  SENESCO shall be entitled, however, to retain one (1)
record set of Builder’s Property in electronic format or hard copy and all
copies of the Instruments of Service to be utilized by SENESCO solely for
purposes of warranty work and any post delivery and acceptance work for which
Buyer may contract with SENESCO.  No consent of SENESCO shall be required by
SENESCO for Buyer’s use of Builder’s Property.  Submittal or distribution of
Builder’s Property to meet official regulatory requirements shall not be deemed
to contravene this provision.  In the event of a SENESCO Default resulting in
the termination of this Agreement, as amended, Buyer shall be entitled to an
exclusive license to employ Builder’s Property to complete the ATB and SENESCO
hereby grants Buyer a security interest in all of its rights, title and interest
in the Builder’s Property and the ATB to the extent of the Milestone Payments
made, and SENESCO hereby authorizes Buyer to file any and all documents,
instruments, and writings necessary or desirable for Buyer to perfect such
security interest.

 

 

 

 

 

 

 

 

 

SENESCO shall not be responsible for the application of Builder’s Property to
any other vessel constructed on the basis of Builder’s Property, and Buyer shall
defend, hold harmless and indemnify SENESCO from any and all applications by
Buyer of Builder’s Property with respect to any vessel other than Hull No. 046.

 

 

 

 

 

 

 

 

 

(ii) SENESCO and Buyer agree and acknowledge that, with the transfer of the
remaining construction work from SENESCO’s Shipyard in Quonset Point to Sparrows
Point, SENESCO will not be able to construct Barge Hull No. 047 for which Buyer
has lodged a $1,000,000 (One Million Dollars) berth deposit with SENESCO (the
“Berth

15

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

 

 

 

 

Deposit”) and that the cost of the Construction Transfer is greater than
originally estimated.  Accordingly, it is agreed that the entire Berth Deposit
shall be applied to the Purchase Price as a component of the Amended Purchase
Price and shall be applied as a credit to the Milestone Payments as provided in
Appendix 3a hereto.  In consideration thereof, SENESCO hereby grants Buyer audit
rights as to all accounting and expenditures incurred by SENESCO for the
tugboat, barges and cranes (the “Major Costs”) required for the Construction
Transfer.  The Major Costs are set out herein in Appendix 11.  If the Major
Costs are less than the amounts originally advised by SENESCO to Buyer, SENESCO
will provide a credit, to Buyer to such extent, against the Amended Purchase
Price.  If the Major Costs are greater, as a result of Owner’s failure to
authorize SENESCO by November 4, 2005 to transfer the construction work to
Sparrows Point, Buyer shall increase the Amended Purchase Price to include that
additional amount and pay SENESCO such amount with the next milestone payment.

 

 

 

 

 

 

24.

Article XI(h) is hereby amended to read:

 

 

 

 

 

 

 

 

 

Construction Transfer.  The Tug shall continue to be constructed at Quonset
Point and the Bow Assembly at Derecktor.  Upon providing Buyer five (5) business
days’ notice but not later than five (5) calendar days after Buyer shall have
given notice that this Amendment No. 3 is effective, SENESCO shall commence  the
Construction Transfer for all sections of the Barge by then fabricated at
Quonset Point, and all steel at the SENESCO shipyard or any SENESCO
subcontractor locations or storage points for the BFE&S purchased for the
construction of the Barge, and all fittings, equipment, and appurtenances of the
Barge, including but not limited to BFE&S to be shipped to Sparrows Point, at
which place SENESCO shall continue construction of the Barge employing the
services of subcontractors subject to approval by the Buyer and certified for
welding operations by the ABS and approved by the USCG, if required.  All
transport of “Work in Progress” (as hereinafter defined) and BFE&S from
SENESCO’s or its subcontractor’s locations shall be at SENESCO’s sole risk, cost
and expense and shall be accomplished by appropriate means, i.e. by water, rail
or truck with due regard to the risks of weather and to avoid damage during
transit.  Prior to transit, SENESCO shall

16

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

 

 

 

 

properly prepare the Work in Progress and BFE&S in a manner appropriate to the
means of transportation selected, including but not limited to the installation
of padeyes on the components of the Barge and other devices, as necessary, to
permit the safe loading and unloading of the Work in Progress and the BFE&S.  To
the extent feasible BFE&S shall be transported by truck or rail and shall be
appropriately protected while in transit.  All costs of the Construction
Transfer are included in the Amended Purchase Price.  With its notice of intent
to commence the Construction Transfer,  SENESCO shall provide a list of all
subcontractors for subcontracts in excess of $100,000 in the aggregate as to
each such subcontractor to be engaged by SENESCO to complete the construction of
the Barge at Sparrows Point.  Buyer shall have five (5) days after the receipt
of such list to consent in writing to each subcontractor, which consent shall
not be unreasonably withheld. When circumstances so require and justify, Buyer
shall have one (1) business day to provide or withhold its consent. Copies of
all such proposed subcontracts shall be furnished with each such notice, if
reasonably requested by Buyer.  If Buyer fails to consent and such rejection is
not unreasonable, SENESCO shall propose alternate subcontractors.  At all times
while continuing work on the Barge, the transport of Barge components to
Sparrows Point and the continuation of construction of the Barge at Sparrows
Point, SENESCO shall remain the prime contractor and responsible in all respects
for the assembly, loading and unloading of the Barge components, the transport
of the Barge components to Sparrows Point, and the continued construction of the
Barge until the Barge is delivered to and accepted by the Buyer on the Delivery
Date in accordance with this Agreement, as amended.  SENESCO shall, to the
extent technically reasonable, continue to perform work with its own or
contracted employees at the SENESCO Shipyard or Sparrows Point Shipyard during
the period of the Construction Transfer.  SENESCO undertakes that at all times
until the Tug and Barge are delivered to and accepted by Buyer, SENESCO shall
assign senior managers (“Senior Managers”) to supervise and manage the
construction of the Tug and Barge at SENESCO’s Shipyard, Sparrows Point, and
subcontractor’s locations and that such Senior Managers shall attend such
locations and shall devote such diligence, time, effort and attention to the
construction of the ATB as required by “good shipping practice.”  The assignment
of such Senior Managers shall be subject to Buyer’s approval which approval
shall be made promptly and not be unreasonably withheld.

17

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

 

 

 

 

SENESCO shall be responsible throughout and until the delivery and acceptance of
the ATB to procure, provide, and maintain in effect all policies of insurance
set out in Article VI(b) of this Agreement and to secure at SENESCO’s sole
expense, all amendments, endorsements, and modifications necessary to insure the
Barge, its components and the BFE&S at the SENESCO shipyard, subcontractor
shipyards and any other storage locations and during transport to Sparrows Point
and during construction at Sparrows Point on the same terms and conditions and
with the same limits as if the Barge were to be completed at the SENESCO
Shipyard, except for the following:

 

 

 

 

 

 

 

 

 

Without limiting any provision of this Agreement as to insurance as hereinabove
provided, SENESCO shall provide insurance on such terms and conditions equal or
equivalent to the Builder’s risk policy maintained by SENESCO for the Barge
together with Charterers’ Liability and/or any other appropriate insurance
covering the means of transport of the Barge components and BFE&S, including
protection and indemnity cover for wreck removal, collision and any similar
liability, including if any of the Barge components shall have been damaged
and/or lost overboard aboard the carrying vessel or any carrying vessel shall
sink, and any loss or damage occurring during loading, transport and discharge
by truck or rail.  Prior to the Construction Transfer, SENESCO shall provide to
Buyer copies of all certificates of insurance applicable to the transport and
continuation of construction at Sparrows Point, or if any such policy be an
existing policy, such policies shall be duly endorsed to cover the loading,
transport, discharge and change in place of construction, as provided by this
Amendment.  A list of all such insurance policies covering the Construction
Transfer and continuation of construction of the Barge at Sparrows Point is set
out in Appendix 10 hereto.  Buyer shall be named as an additional assured on all
such policies including those policies required to be maintained by SENESCO
under any charter party related to the Construction Transfer.

 

 

 

 

 

 

 

 

 

In the event that there shall be reasonable concern on the part of the Buyer
after reviewing the insurance policies and endorsements provided by SENESCO,
Buyer may require SENESCO to produce reasonable evidence from SENESCO’s
insurance brokers confirming the scope of cover or procure replacement or
supplementary insurance at SENESCO’s sole cost.

18

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

 

 

 

 

All risks, costs and expenses of the transport of the Barge components and BFE&S
to Sparrows Point shall be borne by SENESCO.  Such transport shall be conducted
pursuant to contracts in form approved by Buyer and any bills of lading issued
shall be issued in form approved by Buyer shall be marked “Freight Pre-Paid.” 
Each carrier of the Barge components shall be required to deliver a release of
lien as to the Barge components and BFE&S.

 

 

 

 

 

 

 

 

 

Prior to the arrival of any of the Barge components and BFE&S at Sparrows Point,
SENESCO shall deliver to Buyer consents to the transfer and waivers from the
owners and operators of the Sparrows Point facility of any mechanics or
possessory liens, whether arising by statute, common law or in admiralty,
against the Barge components, including BFE&S, and the Barge.  In the case of
any subcontractors with aggregate contracts in excess of $100,000 (One Hundred
Thousand Dollars), SENESCO shall procure similar consents and waivers as
respects the Barge components, BFE&S and the Barge.  To the extent that SENESCO
has pledged any of the Barge components or the Barge or the proceeds of any
Milestone Payments made by the Buyer, SENESCO shall procure a release of any
such recorded lien against the Barge components and/or the Barge to the extent
of the sum of all Milestone Payments made by the Buyer up to and including
delivery of the Barge components to an ocean carrier for transport.  To the
extent there shall be owed by SENESCO to any secured lender or other secured
party an aggregate amount in excess of Milestone Payments received by SENESCO
from Buyer to the date of transport, SENESCO shall obtain from each such secured
party such party’s written consent to the transfer of the construction of the
Barge to Sparrows Point and release of its lien, if any, against the Barge
components or the Barge.  To the extent that such secured lien or security
interest shall secure obligations with respect to any unpaid Milestone Payments,
Buyer shall consent to the delivery by SENESCO to such secured party, any
security filing or other instrument to enable such secured party to maintain an
equivalent security interest in the Barge components and/or the Barge until the
acceptance and delivery of the Barge from Sparrows Point in accordance with this
Agreement as modified by this Amendment.

19

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

 

 

 

 

Any failure of SENESCO to comply with the covenants and terms and conditions of
this Article XI(h), after five (5) business days notice thereof shall constitute
a “SENESCO Default” for purposes of Article VIII(a) of this Agreement.

 

 

 

 

 

 

25.

There shall be added to Article XI a further paragraph (i) as follows:

 

 

 

 

 

 

 

 

 

Buyer’s Right to Complete Construction of the ATB.  If SENESCO shall not have
completed construction of the ATB and tendered it for delivery to the Buyer in
accordance with the terms of the Agreement, as amended, by the date which is
sixty-six (66) calendar days of unexcused or unrelieved delay after the Delivery
Date, the Buyer shall have the right, but not the obligation, to arrange for the
completion of construction of the ATB at the SENESCO Shipyard and/or at Sparrows
Point or at any other U.S. Shipyard selected by the Buyer.  In such event, the
Buyer shall endeavor to cause the completion of the construction of the ATB to
be effected in a cost effective and cost efficient manner consistent with the
drawings and specifications accepted by the parties, provided that nothing
herein shall limit or restrict the Buyer’s right to draw from time to time under
the Amended Barge Letter of Credit or the Amended Tug Letter of Credit, as the
case may be, applicable to each vessel, to reimburse the Buyer for all costs
incurred by the Buyer to complete such construction.  To facilitate completion
and to mitigate damages, SENESCO shall transfer, convey and assign to the Buyer
the Work in Progress.  In the event that the Work in Progress shall be subject
to Restrictive Rights, SENESCO shall provide any written consents or other
documentation required from the beneficiaries of the Restrictive Rights to
effect such Transfers.

 

 

 

 

 

 

 

 

 

 

 

26.

There shall be added to Article XI a further paragraph (j), as follows:

 

 

 

 

 

 

 

 

 

No Other Changes or Modifications.  Each of SENESCO and Buyer acknowledges and
affirms that except as made by this Amendment, there are no other changes or
modifications to the Agreement and that any other changes and modifications to
the Agreement shall be made only by way of further amendment.

20

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

 

27.

There shall be added to Article XI a further paragraph (k), as follows:

 

 

 

 

 

 

 

 

 

Resolution of all Prior Disputes, Controversies, Claims and Notices thereof.  In
consideration of the Amended Purchase Price and this Amendment No. 3, disputes,
controversies, claims and notices thereof existing between the parties and
arising from or out of the Agreement prior to the date hereof shall be deemed to
have been settled, resolved or withdrawn, as the case may be, by this Amendment
No. 3.

 

 

 

 

 

 

28.

Article IVc, Permissible Delay, shall be amended by adding the following
provision:

 

 

 

 

 

 

 

 

 

Any dispute or difference between the parties regarding an event of Permissible
Delay shall be resolved by convening a conference of independent shipbuilding
professionals designated by each party.  Within fifteen (15) days after the
execution of this Amendment, each party shall designate its representative to
the other who may, subject to reasonable grounds, object to that appointment. 
The purpose of the conference shall be to attempt to amicably resolve any and
all disputes as to the occurrence of permissible delay and the time attributable
thereto.  If the representatives are unable to resolve any such dispute, the
parties hereby appoint Charles R. Cushing as the impartial umpire (the “Umpire”)
to confer with each representative and to render a decision with respect to
whether an event of Permissible Delay has occurred and the duration of such
Permissible Delay.  The Umpire shall have ten (10) business days after the
referral of such dispute to render his or her decision.  There shall be no
requirement that the decision of the Umpire be “reasoned.”  In the event that
the Umpire is not available to resolve the dispute or is unable to do so within
the time provided, Joseph Cuneo is appointed as the alternate Umpire.  The
decision of the Umpire, if contested by either party, shall be submitted to
arbitration in accordance with Articles 10(b) and (c) of this Agreement. 
Pending decision by the Umpire, Buyer may not draw on the Barge Letter of Credit
for Liquidated Damages.

21

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

 

29.

This Amendment No. 3 shall not be in effect unless and until SENESCO has
received written notice from Buyer that Buyer’s Board has authorized and
approved this Amendment No. 3 and the first two Milestone Payments of $50,000
and $3,950,000 respectively referenced in Appendix 3a have been paid.

 

 

 

 

30.

This Amendment No. 3 may be executed in counterparts and when executed shall
comprise one agreement.

[This space intentionally left blank]

22

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

 

31.

Except as amended by this Amendment No. 3, all of the terms and conditions of
the Agreement shall remain unchanged and in full force and effect.

          IN WITNESS WHEREOF, the parties have executed this Amendment No. 3 as
of the date hereabove written.

WITNESSES:

 

USCS ATB LLC

 

 

 

 

 

 

 

 

 

 

By:

/s/ JOSEPH P. GEHEGAN

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

 

 

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

 

 

 

Joseph P. Gehegan

 

 

Its:

Chief Operating Officer

 

 

 

 

 

 

 

 

 

 

By:

/s/ ALAN E. COLLETTI

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

 

 

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

 

 

 

Alan E. Colletti

 

 

Its:

Vice President of Operations

 

 

 

 

 

 

 

 

 

 

Southeastern New England Shipbuilding Corporation d/b/a SENESCO Marine

 

 

 

 

 

 

 

 

By:

/s/ FREDERICK G. FROST, III

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

 

 

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

 

 

 

Frederick G. Frost, III

 

 

Its:

Chief Executive Officer

 

 

 

 

 

 

Consented To:

 

 

 

 

 

 

UNITED STATES CHEMICAL SHIPPING LLC, as Guarantor

 

 

 

 

 

 

 

 

 

 

By:

 

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

 

 

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

23

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

TABLE OF APPENDICES

Appendix 3a

Amended Milestone Payment Schedule for Barge and Tug

Appendix 3b

Amended Production Schedule

Appendix 4a

Amended Barge Letter of Credit

Appendix 6a

Amended Milestone Acceptance

Appendix 8a

Amended Tug Letter of Credit

Appendix 9

Storage and Appropriate Insurance for BFE&S

Appendix 10

Construction Transfer Insurance

Appendix 11

Major Costs of Construction Transfer

24

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

APPENDIX 3a

AMENDED MILESTONE PAYMENT SCHEDULE

Barge

PART 1—In Connection with the Execution of Amendment No. 3

 

Buyer’s notice of Board Approval

$

50,000.00

 

 

 

 

 

 

 

To be paid on provision of all of the following in form satisfactory to Buyer:

 

 

 

 

 

 

 

 

 

 

(a) On execution and delivery to Buyer of original executed Sublease Agreement
for Sparrows Point;

 

 

 

 

 

 

 

 

 

(b) Amended Letters of Credit with issuer’s transfer consents;

 

 

 

 

 

 

 

 

 

(c) Executed Barge Charter Party for Construction Transfer;

 

 

 

 

 

 

 

 

 

(d) Evidence of Insurance required by Article I(f);

 

 

 

 

 

 

 

 

 

(e) Evidence of Insurance required by Article XI(h)

$

3,950,000.00

 

 

 

 

 

 

Upon delivery of Barge to Sparrows Point

$

1,000,000.00

 

($500,000 of which is to be paid by Berth Credit)

 

 

 

 

 

 

 

 

Delivery of Lien Waivers or Consents

 

 

 

Required by Paragraph 12

$

1,000,000.00

 

 

 

 

 

 

SENESCO’s representative certificate that Blocs 2 & 3 are assembled and are in a
position for building

$

1,000,000.00

 

($500,000 of which is to be paid by Berth Credit)

 

 

 

 

 

 

 

 

 

 

 

Subtotal

$

7,000,000.00

 

 

 

 

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

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

25

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

APPENDIX 3a
(continued)

PART 2

046 Revised Milestone Schedule

Milestone

 

Amount

 

Expected Date

 

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

 

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

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

 

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

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

 

Master Butt 8/9

 

$

722,547

 

 

1/19/06

 

Master Butt 6/7

 

$

722,547

 

 

1/24/06

 

Erect Cofferdam Mod 7

 

$

361,273

 

 

2/1/06

 

Erect Long Bhd Mod 7&8

 

$

361,273

 

 

2/9/06

 

Erect Cofferdam 9

 

$

361,273

 

 

2/20/06

 

Erect Mod 7 Wings P&S

 

$

361,273

 

 

2/28/06

 

Erect Mod 8 Wings P&S

 

$

722,547

 

 

3/16/06

 

Erect Mod 6 Wings P&S

 

$

722,547

 

 

3/27/06

 

Erect Mod 9 Wings p&s

 

$

361,273

 

 

4/4/06

 

Erect mod 5 Wings P&S

 

$

361,273

 

 

4/4/06

 

Erect 4 Wings P&S

 

$

361,273

 

 

4/12/06

 

Erect Mod 10 Wings P&S

 

$

361,273

 

 

4/20/06

 

Erect Mod 3 Wings P&S

 

$

289,019

 

 

5/1/06

 

Erect Main Deck Mod 3

 

$

289,019

 

 

5/1/06

 

Erect Mod 11 Wing P&S

 

$

289,019

 

 

5/9/06

 

Erect Mod 12 Wings P&S

 

$

289,019

 

 

5/25/06

 

Erect Lower Bow

 

$

289,019

 

 

5/25/06

 

Erect Mid Section Bow

 

$

722,547

 

 

6/5/06

 

Install Manifold Module

 

$

722,547

 

 

6/20/05

 

Erect Upper Bow

 

$

722,547

 

 

7/10/06

 

Install Vents, Sounds Overflows tk 1

 

$

722,547

 

 

7/26/06

 

Erect Stern Sections

 

$

240,849

 

 

8/3/06

 

Air Test Tank 1 Cargo / Ballast

 

$

240,849

 

 

8/3/06

 

Shoot / Install Cargo Pump Trunks tk 5

 

$

240,849

 

 

8/14/06

 

Install Vents, Sounds, Overflows tk 5

 

$

240,849

 

 

8/22/06

 

Air Test Tank 5 Cargo / Ballast

 

$

240,849

 

 

8/30/06

 

Blast paint #1  Cargo and Ballast Tanks

 

$

240,849

 

 

8/30/06

 

Blast paint #5 Cargo and Ballast Tanks

 

$

722,547

 

 

9/26/06

 

Undock

 

$

722,547

 

 

9/27/06

 

Hydro Cargo Tanks / Ballast Tanks

 

$

1,445,094

 

 

10/16/06

 

Test & Trials, Final Outfit

 

$

481,698

 

 

11/20/06

 

Sea Trials

 

$

481,698

 

 

11/22/06

 

Clean and Final Sell

 

$

481,698

 

 

11/30/06

 

 

 

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

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

 

 

 

 

Total

 

$

15,896,029

 

 

 

 

26

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

APPENDIX 3a
(continued)

Tug

USCS ATB, LLC - PROGRESS PAYMENT SCHEDULE - TUG #318

Milestone Description

 

Proposed
Milestone Value

 

 

 

 

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

 

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

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

 

 

 

 

Signing Tug Contract

 

 

1,551,750.00

 

 

--Paid

 

Per Amendment 1 Item L

 

 

155,000.00

 

 

--Paid

 

Lay Tug Keel

 

 

1,344,850.00

 

 

--Paid

 

Erection of Frames Bow / Bhds Tug Unit

 

 

448,283.33

 

 

--Paid

 

Erection of Frame Stern

 

 

448,283.33

 

 

--Paid

 

Erection of Frame Midbody

 

 

448,283.34

 

 

--Paid

 

Complete Skeg Welding (ready to receive stern tubes)

 

 

336,212.50

 

 

 

 

Install & Align Stern Tubes

 

 

336,212.50

 

 

 

 

Land Reduction Gears (with rough alignment to stern tube)

 

 

336,212.50

 

 

 

 

Land Main Engines (with rough alignment to reduction gears)

 

 

336,212.50

 

 

 

 

Align & Fit Up Modules 1,2,3,10,11

 

 

672,425.00

 

 

 

 

Complete Plate & Weld (from keel to main deck)

 

 

672,425.00

 

 

 

 

Launch Tug

 

 

1,344,850.00

 

 

 

 

Completion of Tug

 

 

2,069,000.00

 

 

 

 

 

 

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

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

 

 

 

 

Total #318

 

 

10,500,000.00

 

 

 

 

 

 

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

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

 

 

 

 

27

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

APPENDIX 3b

AMENDED PRODUCTION SCHEDULE

Task Name

 

Duration

 

Start Date

 

Finish Date

 

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

 

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

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

 

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

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

 

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

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

 

Sign Agreement

 

 

1 day?

 

 

11/15/2005

 

 

11/16/2005

 

Sign Agreement on Drydock Rental

 

 

1 day?

 

 

11/16/2005

 

 

11/17/2005

 

Install padeyes / cut mods 9 /10

 

 

5 days

 

 

11/16/2005

 

 

11/28/2005

 

Obtain barge

 

 

5 days

 

 

11/16/2005

 

 

11/28/2005

 

Load out Barge

 

 

5 days

 

 

11/28/2005

 

 

12/6/2005

 

Set Up Blocking for barge in Drydock

 

 

10 days

 

 

11/17/2005

 

 

12/7/2005

 

Tow to Baltimore

 

 

5 days

 

 

12/6/2005

 

 

12/14/2005

 

Offload In Baltimore

 

 

3 days

 

 

12/15/2005

 

 

12/20/2005

 

Erect Modules 7,8, in graving dock

 

 

1 day

 

 

12/20/2005

 

 

12/21/2005

 

Erect Modules 9,10 in graving dock

 

 

1 day

 

 

12/22/2005

 

 

12/26/2005

 

Erect modules 11,11A, 12 in graving dock

 

 

1 day

 

 

12/26/2005

 

 

12/27/2005

 

Erect Modules 5,6 in graving dock

 

 

1 day

 

 

12/27/2005

 

 

12/28/2005

 

Erect Module 4 in graving dock

 

 

1 day

 

 

12/28/2005

 

 

12/29/2005

 

Erect Module 3 in graving dock.

 

 

1 day

 

 

12/30/2005

 

 

1/2/2006

 

Assembly Mod 3 Main Deck

 

 

10 days

 

 

12/22/2005

 

 

1/10/2006

 

Assembly Mod 4 main Deck

 

 

10 days

 

 

12/22/2005

 

 

1/10/2006

 

Assembly Mod 5 main Deck

 

 

10 days

 

 

12/22/2005

 

 

1/10/2006

 

Assembly Mod 6 main Deck

 

 

10 days

 

 

12/22/2005

 

 

1/10/2006

 

Assembly Mod 10 main Deck

 

 

10 days

 

 

12/22/2005

 

 

1/10/2006

 

Assembly Mod 11 main Deck

 

 

10 days

 

 

12/22/2005

 

 

1/10/2006

 

Assembly Mod 12 main Deck

 

 

10 days

 

 

12/22/2005

 

 

1/10/2006

 

Master Butt 8/9

 

 

15 days

 

 

12/27/2005

 

 

1/23/2006

 

Master Butt 10/11

 

 

15 days

 

 

12/27/2005

 

 

1/23/2006

 

Assembly Mod 12 wings

 

 

20 days

 

 

12/22/2005

 

 

1/26/2006

 

Assembly Mod 6 Wings

 

 

20 days

 

 

12/22/2005

 

 

1/26/2006

 

Assembly Mod 5 Wings

 

 

20 days

 

 

12/22/2005

 

 

1/26/2006

 

Assembly Mod 4 Wings

 

 

20 days

 

 

12/22/2005

 

 

1/26/2006

 

Assembly 3 Wings

 

 

20 days

 

 

12/22/2005

 

 

1/26/2006

 

Master Butt 6/7

 

 

15 days

 

 

12/28/2005

 

 

1/24/2006

 

Master Butt 4/5

 

 

15 days

 

 

12/30/2005

 

 

1/25/2006

 

Erect Cofferdam Mod 7

 

 

15 days

 

 

1/6/2006

 

 

2/1/2006

 

Assembly Mod 5 C/Dam

 

 

30 days

 

 

12/22/2005

 

 

2/14/2006

 

Erect Long Bhd Mod 7&8

 

 

15 days

 

 

1/16/2006

 

 

2/9/2006

 

Erect Cofferdam 9

 

 

15 days

 

 

1/24/2006

 

 

2/20/2006

 

Master Butt 3/4

 

 

15 days

 

 

1/25/2006

 

 

2/21/2006

 

Erect Long Bhd 9 & 10

 

 

15 days

 

 

2/1/2006

 

 

2/28/2006

 

Erect long Bhd 5 & 6

 

 

15 days

 

 

2/1/2006

 

 

2/28/2006

 

Erect Mod 7 Wings p & s

 

 

15 days

 

 

2/1/2006

 

 

2/28/2006

 

Fab & Assemble above dk pipe 41-49

 

 

10 days

 

 

2/24/2006

 

 

3/14/2006

 

Erect Cofferdam mod 11

 

 

15 days

 

 

2/10/2006

 

 

3/8/2006

 

Erect Cofferdam Mod 5

 

 

15 days

 

 

2/14/2006

 

 

3/13/2006

 

28

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

Task Name

 

Duration

 

Start Date

 

Finish Date

 

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

 

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

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

 

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

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

 

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

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

 

Erect Long Bhd 11/12

 

 

15 days

 

 

2/20/2006

 

 

3/16/2006

 

Erect Mod 8 Wings p & s

 

 

15 days

 

 

2/20/2006

 

 

3/16/2006

 

Erect main deck Mod 7

 

 

10 days

 

 

2/28/2006

 

 

3/16/2006

 

Erect Long Bhds 3 & 4

 

 

15 days

 

 

2/22/2006

 

 

3/21/2006

 

Assemble Hose racks

 

 

20 days

 

 

2/24/2006

 

 

3/30/2006

 

Erect Mod 6 Wings P&S

 

 

15 days

 

 

2/28/2006

 

 

3/27/2006

 

Erect Main Deck Mod 6

 

 

10 days

 

 

3/8/2006

 

 

3/27/2006

 

Fab / Assy Above dk pipe racks 36-41

 

 

15 days

 

 

3/14/2006

 

 

4/10/2006

 

Fab/Assy above dk pipe rack 24-36

 

 

10 days

 

 

3/22/2006

 

 

4/10/2006

 

Erect Mod 9 Wings p&s

 

 

15 days

 

 

3/8/2006

 

 

4/4/2006

 

Erect mod 5 Wings P&S

 

 

15 days

 

 

3/8/2006

 

 

4/4/2006

 

Erect Main Deck Mod 8

 

 

10 days

 

 

3/17/2006

 

 

4/4/2006

 

Erect Main Deck Mod 5

 

 

10 days

 

 

3/17/2006

 

 

4/4/2006

 

Assemble tankermans House

 

 

30 days

 

 

2/24/2006

 

 

4/18/2006

 

Install pipe rack fr 24-36

 

 

5 days

 

 

4/10/2006

 

 

4/18/2006

 

Assembly handrails / spillrail

 

 

30 days

 

 

2/24/2006

 

 

4/18/2006

 

Erect 4 Wings p & s

 

 

15 days

 

 

3/17/2006

 

 

4/12/2006

 

Erect Main Deck Mod 9

 

 

10 days

 

 

3/27/2006

 

 

4/12/2006

 

Erect Main Deck Mod 4

 

 

10 days

 

 

3/27/2006

 

 

4/12/2006

 

Shoot / install cargo pump trunks tk 2

 

 

5 days

 

 

4/4/2006

 

 

4/12/2006

 

Fab/Assy above dk pipe rack fr 16-24

 

 

15 days

 

 

3/31/2006

 

 

4/26/2006

 

Fab/Assy above dk pipe fr 24-6

 

 

10 days

 

 

4/10/2006

 

 

4/26/2006

 

Install Winch Found fr 19

 

 

4 days

 

 

4/12/2006

 

 

4/19/2006

 

Erect Mod 10 Wings p & s

 

 

15 days

 

 

3/27/2006

 

 

4/20/2006

 

Erect Main Deck Mod 10

 

 

10 days

 

 

4/4/2006

 

 

4/20/2006

 

Shoot/Install cargo pump trunks tk 3

 

 

5 days

 

 

4/12/2006

 

 

4/20/2006

 

Install vents, sounds, overflows tk 2

 

 

10 days

 

 

4/4/2006

 

 

4/20/2006

 

Install Wich fr 19

 

 

4 days

 

 

4/19/2006

 

 

4/26/2006

 

Assembly Stern

 

 

75 days

 

 

12/26/2005

 

 

5/4/2006

 

Fab ballast system

 

 

60 days

 

 

1/20/2006

 

 

5/4/2006

 

Install handrails Mod 5 mn Deck

 

 

10 days

 

 

4/18/2006

 

 

5/4/2006

 

Install handrails Mod 6 mn Deck

 

 

10 days

 

 

4/18/2006

 

 

5/4/2006

 

Install handrails Mod 7 mn Deck

 

 

10 days

 

 

4/18/2006

 

 

5/4/2006

 

Install handrails Mod 8 mn Deck

 

 

10 days

 

 

4/18/2006

 

 

5/4/2006

 

Erect Mod 3 Wings p & s

 

 

15 days

 

 

4/4/2006

 

 

5/1/2006

 

Erect Main Deck Mod 3

 

 

10 days

 

 

4/12/2006

 

 

5/1/2006

 

Install handrails Mod 4 mn Deck

 

 

10 days

 

 

4/18/2006

 

 

5/4/2006

 

Install handrails Mod 9 mn Deck

 

 

10 days

 

 

4/18/2006

 

 

5/4/2006

 

Install hatches, cleats, hot work 26-35

 

 

15 days

 

 

4/4/2006

 

 

5/1/2006

 

Assembly breakwaters

 

 

30 days

 

 

3/20/2006

 

 

5/10/2006

 

Outfit tankermans house

 

 

30 days

 

 

3/22/2006

 

 

5/15/2006

 

Install Winch Found fr 12

 

 

4 days

 

 

5/1/2006

 

 

5/8/2006

 

Erect Mod 11 Wing P&S

 

 

15 days

 

 

4/12/2006

 

 

5/9/2006

 

Erect Main Deck Mod 11

 

 

10 days

 

 

4/21/2006

 

 

5/9/2006

 

Install vents, sounds, overflows tk 3

 

 

10 days

 

 

4/21/2006

 

 

5/9/2006

 

Install handrails Mod 10 mn Deck

 

 

10 days

 

 

4/21/2006

 

 

5/9/2006

 

29

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

Task Name

 

Duration

 

Start Date

 

Finish Date

 

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

 

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

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

 

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

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

 

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

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

 

Install hatches, cleats, hot work fr 17-26

 

 

15 days

 

 

4/12/2006

 

 

5/9/2006

 

Install Cranes

 

 

5 days

 

 

5/1/2006

 

 

5/9/2006

 

Install Ladders, platforms, pipe Tk 2 P&S

 

 

15 days

 

 

4/12/2006

 

 

5/9/2006

 

Install Ladders, platforms, pipe Tk 3 P&S

 

 

15 days

 

 

4/12/2006

 

 

5/9/2006

 

Install Winch fr 12

 

 

4 days

 

 

5/8/2006

 

 

5/15/2006

 

Assemble main deck house

 

 

60 days

 

 

2/7/2006

 

 

5/23/2006

 

Assemble manifold module

 

 

60 days

 

 

2/7/2006

 

 

5/23/2006

 

Shoot/Install cargo pump trunks tk 4

 

 

5 days

 

 

5/9/2006

 

 

5/17/2006

 

Air Test Tank 3 Cargo / ballast

 

 

5 days

 

 

5/9/2006

 

 

5/17/2006

 

Install Pipe rack fr 36-41

 

 

15 days

 

 

4/21/2006

 

 

5/17/2006

 

Install handrails Mod 3 mn Deck

 

 

10 days

 

 

5/1/2006

 

 

5/17/2006

 

Install hatches, cleats, hot work fr 35-41

 

 

15 days

 

 

4/21/2006

 

 

5/17/2006

 

Install Ladders, platforms, pipe Tk 4 P&S

 

 

15 days

 

 

4/21/2006

 

 

5/17/2006

 

Erect Mod 12 wings P&S

 

 

15 days

 

 

5/1/2006

 

 

5/25/2006

 

Erect Main Deck Mod 12

 

 

10 days

 

 

5/9/2006

 

 

5/25/2006

 

Erect Lower bow

 

 

20 days

 

 

4/21/2006

 

 

5/25/2006

 

Install vents, sounds, overflows tk 4

 

 

10 days

 

 

5/9/2006

 

 

5/25/2006

 

Install ballast piping Ford Wings

 

 

15 days

 

 

5/1/2006

 

 

5/25/2006

 

Install handrails Mod 11 mn Deck

 

 

10 days

 

 

5/9/2006

 

 

5/25/2006

 

Install Ladders, platforms, pipe Tk 1 P&S

 

 

15 days

 

 

5/1/2006

 

 

5/25/2006

 

Erect tankermans house

 

 

15 days

 

 

5/15/2006

 

 

6/8/2006

 

Install Winch found fr 49

 

 

4 days

 

 

5/26/2006

 

 

6/1/2006

 

Erect Mid Section Bow

 

 

15 days

 

 

5/9/2006

 

 

6/5/2006

 

Air Test Tank 4 Cargo / ballast

 

 

5 days

 

 

5/26/2006

 

 

6/5/2006

 

Install hatches, cleats, hot work fr 6-17

 

 

20 days

 

 

5/1/2006

 

 

6/5/2006

 

Erect inert Gas Generator house

 

 

5 days

 

 

5/26/2006

 

 

6/5/2006

 

Erect Breakwaters

 

 

20 days

 

 

5/10/2006

 

 

6/14/2006

 

Install Winch fr 49

 

 

4 days

 

 

6/2/2006

 

 

6/8/2006

 

Outfit Deckhouse incl pipe, founds, cableways

 

 

45 days

 

 

3/31/2006

 

 

6/19/2006

 

Air Test Tank 2 cargo / ballast

 

 

5 days

 

 

6/5/2006

 

 

6/13/2006

 

Install ballast piping wings fr 34-46

 

 

30 days

 

 

4/21/2006

 

 

6/13/2006

 

Install Pipe rack fr 41-49

 

 

10 days

 

 

5/26/2006

 

 

6/13/2006

 

Install handrails Mod 12 mn Deck

 

 

10 days

 

 

5/26/2006

 

 

6/13/2006

 

Install ballast System, IB

 

 

60 days

 

 

3/14/2006

 

 

6/27/2006

 

Install manifold module

 

 

20 days

 

 

5/23/2006

 

 

6/27/2006

 

Install hatches,cleats, hot work fr 41-49

 

 

15 days

 

 

5/26/2006

 

 

6/21/2006

 

Install Ladders, platforms, pipe Tk 5 P&S

 

 

15 days

 

 

5/26/2006

 

 

6/21/2006

 

Blast paint #3  cargo, cd7 and ballast tanks

 

 

15 days

 

 

6/9/2006

 

 

7/5/2006

 

Blast paint #4  cargo, cd 11 and ballast tanks

 

 

15 days

 

 

6/5/2006

 

 

6/29/2006

 

Erect main Deck House

 

 

10 days

 

 

6/19/2006

 

 

7/5/2006

 

Air Test ballast System

 

 

10 days

 

 

6/27/2006

 

 

7/13/2006

 

Erect Upper Bow

 

 

30 days

 

 

5/17/2006

 

 

7/10/2006

 

Blast paint #2  cargo and ballast tanks

 

 

15 days

 

 

6/13/2006

 

 

7/10/2006

 

Air Test Bow

 

 

2 days

 

 

7/10/2006

 

 

7/12/2006

 

Install electrical equipment Tank house

 

 

30 days

 

 

5/31/2006

 

 

7/24/2006

 

Shoot / install cargo pump trunks tk 1

 

 

5 days

 

 

7/10/2006

 

 

7/18/2006

 

30

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

Task Name

 

Duration

 

Start Date

 

Finish Date

 

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

 

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

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

 

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

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

 

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

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

 

Install Framo Hydraulics and commision

 

 

45 days

 

 

5/1/2006

 

 

7/18/2006

 

Install Vents, sounds overflows tk 1

 

 

10 days

 

 

7/10/2006

 

 

7/26/2006

 

Install Anchor Winch Found

 

 

10 days

 

 

7/10/2006

 

 

7/26/2006

 

Erect Stern sections

 

 

50 days

 

 

5/9/2006

 

 

8/3/2006

 

Air Test Tank 1 cargo / ballast

 

 

5 days

 

 

7/26/2006

 

 

8/3/2006

 

Install Anchor Windlass

 

 

5 days

 

 

7/26/2006

 

 

8/3/2006

 

Air test stern

 

 

2 days

 

 

8/4/2006

 

 

8/8/2006

 

Complete install IG,vapor, pv valves

 

 

30 days

 

 

6/27/2006

 

 

8/17/2006

 

Install Winch Found fr 57

 

 

4 days

 

 

8/4/2006

 

 

8/10/2006

 

Shoot / install cargo pump trunks tk 5

 

 

5 days

 

 

8/4/2006

 

 

8/14/2006

 

Blast paint bow interior

 

 

10 days

 

 

7/26/2006

 

 

8/14/2006

 

Install All Machinery / Electrical Equipt Main Dk hse

 

 

30 days

 

 

6/27/2006

 

 

8/17/2006

 

Install Winch fr 57

 

 

4 days

 

 

8/11/2006

 

 

8/17/2006

 

Install vents, sounds, overflows tk 5

 

 

10 days

 

 

8/4/2006

 

 

8/22/2006

 

Run Electrical cables main dk

 

 

30 days

 

 

7/5/2006

 

 

8/28/2006

 

Blast paint Exterior

 

 

10 days

 

 

8/8/2006

 

 

8/24/2006

 

Blast paint Stern Interior

 

 

10 days

 

 

8/11/2006

 

 

8/29/2006

 

Air Test Tank 5 cargo / ballast

 

 

5 days

 

 

8/22/2006

 

 

8/30/2006

 

Blast paint #1  cargo, cd5 and ballast tanks

 

 

15 days

 

 

8/4/2006

 

 

8/30/2006

 

Blast paint #5  cargo and ballast tanks

 

 

15 days

 

 

8/30/2006

 

 

9/26/2006

 

Undock

 

 

1 day

 

 

9/26/2006

 

 

9/27/2006

 

Hydro cargo tanks / ballast tanks

 

 

10 days

 

 

9/27/2006

 

 

10/16/2006

 

Successful Test & trials, final outfit

 

 

20 days

 

 

10/16/2006

 

 

11/20/2006

 

Successful Sea Trials

 

 

2 days

 

 

11/20/2006

 

 

11/22/2006

 

Clean and final Sell

 

 

5 days

 

 

11/22/2006

 

 

11/30/2006

 

31

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

APPENDIX 4a

AMENDED BARGE LETTER OF CREDIT

 

 

AMENDED IRREVOCABLE STANDBY LETTER OF CREDIT NO. RS64136369

 

 

 

 

 

DATE OF ISSUE: OCTOBER 21, 2004

 

 

DATE OF AMENDMENT: NOVEMBER    , 2005

 

 

 

ISSUING BANK:

 

 

[                                                                                                ]

 

APPLICANT:

 

 

MALCOLM G. CHACE

 

 

C/O POINT GAMMON CORP

 

 

1 PROVIDENCE WASHINGTON BLDG

 

 

PROVIDENCE, RI 02903

 

 

 

 

 

BENEFICIARY:

 

 

USCS ATB LLC

 

 

PO BOX 2945

 

 

EDISON, NEW JERSEY 08818-2945

 

 

ATTN: ALAN E. COLLETTI

 

 

 

 

 

AMOUNT/CURRENCY:

 

 

USD 15,000,000.00

 

 

FIFTEEN MILLION AND 00/100’S US DOLLARS

 

 

 

 

 

DATE AND PLACE OF EXPIRY:

 

 

DECEMBER 31, 2007 OUR COUNTERS

GENTLEMEN:

WE HEREBY AMEND OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO. RS64136369 IN YOUR
FAVOR AS BENEFICIARY IN THE AMOUNT USD 15,000,000.00 (FIFTEEN MILLION UNITED
STATES DOLLARS), WHICH CREDIT IS AVAILABLE WITH BANK OF AMERICA BY PAYMENT OF
BENEFICIARY’S DRAFT(S) AT SIGHT DRAWN ON BANK OF AMERICA.

THE EXPIRY DATE IS CHANGED TO DECEMBER 31, 2007.

DRAFTS MUST BE ACCOMPANIED BY:

1.          THE ORIGINAL LETTER OF CREDIT AND ALL AMENDMENTS, IF ANY.

32

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

THIS IS AN INTEGRAL PART OF LETTER OF CREDIT NUMBER: RS64136369

2.

A BENEFICIARY’S DATED STATEMENT ON BENEFICIARY’S LETTERHEAD PURPORTEDLY SIGNED
BY AN AUTHORIZED OFFICER STATING “UNDER PENALTY OF PERJURY, WE HEREBY CERTIFY
THAT” AND ONE OF THE FOLLOWING:

QUOTE
THERE IS A BREACH OR DEFAULT ON THE PART OF SOUTHEASTERN NEW ENGLAND
SHIPBUILDING CORPORATION D/B/A SENESCO MARINE (“SENESCO”) UNDER THE ARTICULATED
TUG BARGE BUILDING AGREEMENT DATED AS OF AUGUST 7, 2004 (AS AMENDED, THE
“AGREEMENT”) BETWEEN SENESCO, BENEFICIARY, AS BUYER, AND UNITED STATES CHEMICAL
SHIPPING LLC, AS GUARANTOR, FOR THE CONSTRUCTION OF A BARGE KNOWN AS HULL NO. 46
(THE “BARGE”) FOR WHICH THERE IS NO APPLICABLE CURE PERIOD OR FOR WHICH THE
APPLICABLE CURE PERIOD HAS EXPIRED WITHOUT CURE; AND THE BENEFICIARY HAS
(A) TAKEN OVER OR OTHERWISE CONTRACTED FOR THE COMPLETION OF THE CONSTRUCTION OF
THE BARGE, AND (B) INCURRED REASONABLE COSTS IN ADDITION TO AMOUNTS PAID FOR
BUYER FURNISHED EQUIPMENT (AS DEFINED IN THE AGREEMENT) AND TO SENESCO UNDER THE
AGREEMENT TO COMPLETE CONSTRUCTION OF THE BARGE THAT ARE IN EXCESS OF THE
PURCHASE PRICE (AS DEFINED IN THE AGREEMENT, INCLUDING ALL AMOUNTS PAID PURSUANT
TO THE AGREEMENT); AND THE BENEFICIARY IS ENTITLED TO DRAW UNDER THIS LETTER OF
CREDIT THE AGGREGATE AMOUNT IN EXCESS OF THE AMENDED PURCHASE PRICE (AS DEFINED
IN THE AGREEMENT, INCLUDING ALL AMOUNTS PAID PURSUANT TO THE AGREEMENT) THAT
BENEFICIARY HAS SPENT TO COMPLETE THE BARGE, OTHER THAN FOR BUYER FURNISHED
EQUIPMENT (AS DEFINED IN THE AGREEMENT), WITH BENEFICIARY NOW BEING ENTITLED TO
REIMBURSEMENT IN AN AMOUNT EQUAL TO US $______________
UNQUOTE

OR

QUOTE
AS LIQUIDATED DAMAGES UP TO A MAXIMUM AMOUNT OF $1,980,000.00 UNDER
ARTICLE IV(B) OF THE ARTICULATED TUG BARGE BUILDING AGREEMENT DATED AS OF
AUGUST 7, 2004, AS AMENDED AUGUST 7, 2004; SEPTEMBER 29, 2004; AND NOVEMBER 3,
2005 (AS AMENDED, THE “AGREEMENT”) BY AND AMONG SOUTHEASTERN NEW ENGLAND
SHIPBUILDING CORPORATION (“SENESCO”), BENEFICIARY AND UNITED STATES CHEMICAL
SHIPPING LLC AS GUARANTOR, SENESCO HAS AGREED TO PAY BENEFICIARY $30,000 PER DAY
UP TO 66 DAYS FOR EACH DAY THAT SENESCO IS LATE IN THE DELIVERY OF THE ATB (AS
DEFINED IN THE AGREEMENT), AND SENESCO IS NOW __ DAYS LATE WITH THE DELIVERY

33

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THIS IS AN INTEGRAL PART OF LETTER OF CREDIT NUMBER: RS64136369

OF THE ATB AND BENEFICIARY IS NOW ENTITLED TO $___________ PURSUANT TO
ARTICLE IV(B) OF THE AGREEMENT.
UNQUOTE

OR

QUOTE
THE ISSUING BANK HAS ISSUED A NOTICE THAT IT HAS ELECTED NOT TO RENEW THIS
LETTER OF CREDIT, AND AS OF THE FIFTEENTH BUSINESS DAY PRIOR TO THE DATE OF
EXPIRY OF THIS LETTER OF CREDIT, THE APPLICANT HAS NOT DELIVERED TO THE
BENEFICIARY A REPLACEMENT LETTER OF CREDIT CONTAINING IDENTICAL TERMS THAT IS
ISSUED BY A FEDERALLY-INSURED FINANCIAL INSTITUTION WITH A CREDIT RATING OF AT
LEAST AA- BY STANDARD & POOR’S RATING SERVICES OR THE EQUIVALENT CREDIT RATING
FROM A NATIONALLY-RECOGNIZED CREDIT RATING AGENCY.
UNQUOTE

PARTIAL AND MULTIPLE DRAWINGS ARE ALLOWED ON THIS LETTER OF CREDIT.

THIS LETTER OF CREDIT IS TRANSFERABLE ONLY TO EITHER CANADIAN IMPERIAL BANK OF
COMMERCE, AS ADMINISTRATIVE AGENT, OR KEYBANK NATIONAL ASSOCIATION, AS
COLLATERAL AGENT, AND THEIR SUCCESSORS AND ASSIGNS IN SUCH CAPACITIES.

IT IS A CONDITION OF THIS LETTER OF CREDIT THAT IT SHALL BE DEEMED AUTOMATICALLY
EXTENDED WITHOUT AMENDMENT FOR SIX MONTHS FROM THE PRESENT OR ANY FUTURE
EXPIRATION DATE UNLESS AT LEAST THIRTY DAYS PRIOR TO SUCH EXPIRATION DATE THE
ISSUING BANK NOTIFIES YOU BY COURIER OR CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, THAT THE ISSUING BANK HAS ELECTED NOT TO CONSIDER THIS LETTER OF
CREDIT RENEWED FOR ANY SUCH PERIOD.  IF THE ISSUING BANK ELECTS NOT TO RENEW
THIS LETTER OF CREDIT, THE BENEFICIARY SHALL HAVE THE RIGHT TO DRAW THE FULL
AMOUNT OF SUCH LETTER OF CREDIT AT ANY TIME PRIOR TO ITS THEN APPLICABLE
EXPIRATION DATE.

THE NUMBER AND DATE OF THE CREDIT AND THE NAME OF OUR BANK MUST BE QUOTED ON ALL
DRAFT(S) REQUIRED.

EACH DRAFT PRESENTED HEREUNDER MUST BE ACCOMPANIED BY THE ORIGINAL CREDIT FOR
ENDORSEMENT THEREON OF THE AMOUNT OF SUCH DRAFT.

34

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

THIS IS AN INTEGRAL PART OF LETTER OF CREDIT NUMBER: RS64136369

DRAFT(S) AND DOCUMENTS MUST BE PRESENTED AT OUR OFFICES AT
[__________________________ INSERT ADDRESS].

COMMUNICATIONS WITH RESPECT TO THIS LETTER OF CREDIT SHALL BE IN WRITING AND
SHALL BE ADDRESSED TO US AT [________________________ INSERT ADDRESS]

SPECIFICALLY REFERRING TO THE NUMBER OF THIS LETTER OF CREDIT.

THIS CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY
CREDITS (1993 EDITION), THE INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION
NO. 500.

 

 

 

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

 

AUTHORIZED SIGNATURE

THIS DOCUMENT CONSISTS OF 4 PAGE(S)

35

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APPENDIX 6a

AMENDED MILESTONE ACCEPTANCE

SENESCO MARINE
REQUEST FOR PAYMENT
INVOICE NUMBER _________
CONTRACT #046

Milestone Reference: _______________________

Southeastern New England Shipbuilding Corporation, d/b/a SENESCO Marine, hereby
requests a Milestone progress payment, as referenced above, from (Buyer and/or
Financial Institution) in connection with the completion of this milestone.

SENESCO Marine hereby certifies that the work required on the referenced
milestone and on the corresponding task and all prior tasks on the Amended
Production Schedule has been completed in all respects in accordance with the
Contract, Plans and Specifications and ABS Standards.

Buyer’s inspector certifies that he has inspected the work required on the
referenced milestone and on the corresponding task and all prior tasks on the
Amended Production Schedule and that it has been completed in all respects in
accordance with the Contract, Plans, and Specifications and ABS Standards.

SENESCO Marine further certifies that there are no liens created by SENESCO
Marine on the vessel being Hull Number #46, and that SENESCO Marine has not
encumbered said vessel in any way.

SENESCO Marine hereby agrees to indemnify and hold Buyer/Financial Institution
harmless from any claim, liens or encumbrances, incurred by Buyer/Financial
Institution arising out of any misrepresentation herein.

This request for payment is subject to the Contract and nothing in this request
for payment alters or amends the Contract or the respective obligations of the
parties hereto.

SENESCO Marine

USC ATB LLC

 

 

Project Manager

Buyer’s Inspector

 

 

 

 

Dated: _______________

Dated: _______________

36

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APPENDIX 8a

AMENDED TUG LETTER OF CREDIT

 

 

AMENDED IRREVOCABLE STANDBY LETTER OF CREDIT NO. RS64136375

 

 

 

 

 

DATE OF ISSUE: OCTOBER 21, 2004

 

 

DATE OF AMENDMENT: NOVEMBER    , 2005

 

 

 

ISSUING BANK:

 

 

[                                                                                                ]

 

APPLICANT:

 

 

MALCOLM G. CHACE

 

 

C/O POINT GAMMON CORP

 

 

1 PROVIDENCE WASHINGTON BLDG

 

 

PROVIDENCE, RI 02903

 

 

 

 

 

BENEFICIARY:

 

 

USCS ATB LLC

 

 

PO BOX 2945

 

 

EDISON, NEW JERSEY 08818-2945

 

 

ATTN: ALAN E. COLLETTI

 

 

 

 

 

AMOUNT/CURRENCY:

 

 

USD 3,000,000.00

 

 

THREE MILLION AND 00/100’S US DOLLARS

 

 

 

 

 

DATE AND PLACE OF EXPIRY:

 

 

DECEMBER 31, 2007 OUR COUNTERS

GENTLEMEN:

WE HEREBY AMEND OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO. RS64136375 IN YOUR
FAVOR AS BENEFICIARY IN THE AMOUNT USD 3,000,000.00 (THREE MILLION UNITED STATES
DOLLARS), WHICH CREDIT IS AVAILABLE WITH BANK OF AMERICA BY PAYMENT OF
BENEFICIARY’S DRAFT(S) AT SIGHT DRAWN ON BANK OF AMERICA.

THE EXPIRY DATE IS CHANGED TO DECEMBER 31, 2007.

DRAFTS MUST BE ACCOMPANIED BY:

1.          THE ORIGINAL LETTER OF CREDIT AND ALL AMENDMENTS, IF ANY.

37

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

THIS IS AN INTEGRAL PART OF LETTER OF CREDIT NUMBER: RS64136375

2.

A BENEFICIARY’S DATED STATEMENT ON BENEFICIARY’S LETTERHEAD PURPORTEDLY SIGNED
BY AN AUTHORIZED OFFICER STATING “UNDER PENALTY OF PERJURY, WE HEREBY CERTIFY
THAT” AND ONE OF THE FOLLOWING:

QUOTE
THERE IS A BREACH OR DEFAULT ON THE PART OF SOUTHEASTERN NEW ENGLAND
SHIPBUILDING CORPORATION D/B/A SENESCO MARINE (“SENESCO”) UNDER THE ARTICULATED
TUG BARGE BUILDING AGREEMENT DATED AS OF AUGUST 7, 2004 (AS AMENDED, THE
“AGREEMENT”) BETWEEN SENESCO, BENEFICIARY, AS BUYER, AND UNITED STATES CHEMICAL
SHIPPING LLC, AS GUARANTOR, FOR THE CONSTRUCTION OF A TUG BOAT KNOWN AS HULL
NO. 318 (THE “TUG”) FOR WHICH THERE IS NO APPLICABLE CURE PERIOD OR FOR WHICH
THE APPLICABLE CURE PERIOD HAS EXPIRED WITHOUT CURE; AND THE BENEFICIARY HAS
(A) TAKEN OVER OR OTHERWISE CONTRACTED FOR THE COMPLETION OF THE CONSTRUCTION OF
THE TUG, AND (B) INCURRED REASONABLE COSTS, IN ADDITION TO AMOUNTS PAID FOR
BUYER FURNISHED EQUIPMENT (AS DEFINED IN THE AGREEMENT) AND TO SENESCO UNDER THE
AGREEMENT TO COMPLETE CONSTRUCTION OF THE TUG THAT ARE IN EXCESS OF THE PURCHASE
PRICE (AS DEFINED IN THE AGREEMENT, INCLUDING ALL AMOUNTS PAID PURSUANT TO THE
AGREEMENT); AND THE BENEFICIARY IS ENTITLED TO DRAW UNDER THIS LETTER OF CREDIT
THE AGGREGATE AMOUNT IN EXCESS OF THE AMENDED PURCHASE PRICE (AS DEFINED IN THE
AGREEMENT, INCLUDING ALL AMOUNTS PAID PURSUANT TO THE AGREEMENT) THAT
BENEFICIARY HAS SPENT TO COMPLETE THE TUG, OTHER THAN FOR BUYER FURNISHED
EQUIPMENT (AS DEFINED IN THE AGREEMENT), WITH BENEFICIARY NOW BEING ENTITLED TO
REIMBURSEMENT IN AN AMOUNT EQUAL TO US $______________
UNQUOTE

OR

QUOTE
THE ISSUING BANK HAS ISSUED A NOTICE THAT IT HAS ELECTED NOT TO RENEW THIS
LETTER OF CREDIT, AND AS OF THE FIFTEENTH BUSINESS DAY PRIOR TO THE DATE OF
EXPIRY OF THIS LETTER OF CREDIT, THE APPLICANT HAS NOT DELIVERED TO THE
BENEFICIARY A REPLACEMENT LETTER OF CREDIT CONTAINING IDENTICAL TERMS THAT IS
ISSUED BY A FEDERALLY-INSURED FINANCIAL INSTITUTION WITH A CREDIT RATING OF AT
LEAST AA- BY STANDARD & POOR’S RATING SERVICES OR THE EQUIVALENT CREDIT RATING
FROM A NATIONALLY-RECOGNIZED CREDIT RATING AGENCY.
UNQUOTE

38

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

THIS IS AN INTEGRAL PART OF LETTER OF CREDIT NUMBER: RS64136375

PARTIAL AND MULTIPLE DRAWINGS ARE ALLOWED ON THIS LETTER OF CREDIT.

THIS LETTER OF CREDIT IS TRANSFERABLE ONLY TO EITHER CANADIAN IMPERIAL BANK OF
COMMERCE, AS ADMINISTRATIVE AGENT, OR KEYBANK NATIONAL ASSOCIATION, AS
COLLATERAL AGENT, AND THEIR SUCCESSORS AND ASSIGNS IN SUCH CAPACITIES.

IT IS A CONDITION OF THIS LETTER OF CREDIT THAT IT SHALL BE DEEMED AUTOMATICALLY
EXTENDED WITHOUT AMENDMENT FOR SIX MONTHS FROM THE PRESENT OR ANY FUTURE
EXPIRATION DATE UNLESS AT LEAST THIRTY DAYS PRIOR TO SUCH EXPIRATION DATE, THE
ISSUING BANK NOTIFIES YOU BY COURIER OR CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, THAT THE ISSUING BANK HAS ELECTED NOT TO CONSIDER THIS LETTER OF
CREDIT RENEWED FOR ANY SUCH PERIOD.  IF THE ISSUING BANK ELECTS NOT TO RENEW
THIS LETTER OF CREDIT, THE BENEFICIARY SHALL HAVE THE RIGHT TO DRAW THE FULL
AMOUNT OF SUCH LETTER OF CREDIT AT ANY TIME PRIOR TO ITS THEN APPLICABLE
EXPIRATION DATE.

THE NUMBER AND DATE OF THE CREDIT AND THE NAME OF OUR BANK MUST BE QUOTED ON ALL
DRAFT(S) REQUIRED.

EACH DRAFT PRESENTED HEREUNDER MUST BE ACCOMPANIED BY THE ORIGINAL CREDIT FOR
ENDORSEMENT THEREON OF THE AMOUNT OF SUCH DRAFT.

DRAFT(S) AND DOCUMENTS MUST BE PRESENTED AT OUR OFFICES AT
[__________________________ INSERT ADDRESS].

COMMUNICATIONS WITH RESPECT TO THIS LETTER OF CREDIT SHALL BE IN WRITING AND
SHALL BE ADDRESSED TO US AT [________________________ INSERT ADDRESS]
SPECIFICALLY REFERRING TO THE NUMBER OF THIS LETTER OF CREDIT.

THIS CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY
CREDITS (1993 EDITION), THE INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION
NO. 500.

 

 

 

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

 

AUTHORIZED SIGNATURE

THIS DOCUMENT CONSISTS OF 3 PAGE(S)

39

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

APPENDIX 9

STORAGE AND APPROPRIATE INSURANCE FOR BFE&S

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

APPENDIX 10

CONSTRUCTION TRANSFER INSURANCE

[To be separately provided in satisfactory form and content to Buyer
prior to Construction Transfer Date.]

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

APPENDIX 11

MAJOR COSTS OF CONSTRUCTION TRANSFER

Tugboat(s)

$161,000.00 (est.)

Barge(s)

$75,000.00 plus $2500 per day after 30 days (est.)

Crane(s)

$486,000 (est.)

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