Exhibit 10.8


 


AMENDED AND RESTATED

EMPLOYMENT AGREEMENT


 


AGREEMENT (this “Agreement”) made as of November
3, 2004, between USS Vessel Management LLC, a Delaware limited liability company
with an office at 399 Thornall Street, Edison, New Jersey 08837 (the “Company”),
and Paul Gridley, residing at 356 East 69th Street, New York, New
York  10021 (the “Executive”).


 


W I T N E S S E T H:


 


WHEREAS, Executive is presently the Chairman and Chief
Executive Officer of the Company, United States Shipping Master LLC, a Delaware
limited liability company (“Parent”), and each subsidiary of Parent
(collectively with the Company, Parent and any entity that hereafter becomes a
subsidiary of Parent or U.S. Shipping Partners L.P., a Delaware limited
partnership (the “Partnership”), the “US Shipping Group”);


 


WHEREAS, on the date of the closing of the initial
public offering of the Partnership pursuant to its Registration Statement on
Form S-1 (No. 333-118141) (such date the “Effective Date”) Parent will
contribute the operating subsidiaries constituting the US Shipping Group (other
than the Company, USS Transport LLC, USS Chemical Transport LLC and US Shipping
General Partner LLC, the sole member of the Company (the “General Partner”))
to the Partnership;


 


WHEREAS, the Company and Executive are parties to an
employment agreement dated as of September 13, 2002 (the “Prior Agreement”);


 


WHEREAS, the Company and Executive desire to amend and
restate the terms of the Prior Agreement; and


 


WHEREAS, this Agreement shall supercede and completely
replace the Prior Agreement as of the Effective Date.


 


NOW, THEREFORE, in consideration of the premises and
of the mutual promises, representations and covenants herein contained, the
parties hereto agree as follows:


 


1.             EMPLOYMENT.


 


The Company hereby employs Executive and Executive
hereby accepts such employment, subject to the terms and conditions herein set
forth.  Executive shall hold the office
of Chairman and Chief Executive Officer of the Company reporting to the Board
of Directors of the Company (the “Company Board”) and the Board of
Directors of the General Partner (the “GP Board”).


 


2.             TERM.


 


The initial term of employment under this Agreement
shall begin on the Effective Date and shall continue until October 31 2007,
subject to prior termination in accordance with the terms hereof (the “Initial
Term”).  The Initial Term shall be
automatically extended for successive additional periods of one (1) year
commencing on the third anniversary of the Effective Date and each anniversary
thereof (each such period, an “Additional Term”) unless either party
shall have given written notice to the other party of non-extension at least
sixty (60) days’ prior to the end of the then applicable Initial Term or
Additional Term (the Initial Term and any Additional Term collectively, the “Employment
Term”).  Notice of non-extension by
the Company shall be deemed a termination without justifiable cause (as defined
herein) at 


 





















 


the end of the then current Employment Term and notice of non-extension
by Executive shall be deemed a termination without good reason (as defined
herein) at the end of the then current Employment Term.


 


3.             COMPENSATION.


 


As compensation for the employment services to be
rendered by Executive hereunder, including all services as an officer or
director of any member of the US Shipping Group, the Company agrees to pay, or
cause to be paid, to Executive, and Executive agrees to accept, payable in
equal installments in accordance with Company practice, an initial annual
salary of $417,000.  Executive’s annual
salary hereunder for the remaining years of employment shall be determined by
the GP Board in its sole discretion; provided, however, that in no event shall
Executive’s salary in any year be reduced below the rate for the previous year.  In addition, Executive shall be eligible for
bonuses from time to time in such amounts as may be determined by the GP Board
in its sole discretion.


 


4.             EXPENSES.


 


The Company shall pay or reimburse Executive, upon
presentment of suitable vouchers, for all reasonable business and travel
expenses which may be incurred or paid by Executive in connection with his
employment hereunder in accordance with Company policy as established from time
to time by the Board of Directors. 
Executive shall comply with such restrictions and shall keep such
records as the Company may reasonably deem necessary to meet the requirements
of the Internal Revenue Code of 1986, as amended from time to time (the “Code”),
and regulations promulgated thereunder.


 


5.             OTHER
BENEFITS.


 


Executive shall be entitled to a minimum of four weeks
paid vacation per year and to participate in such benefit plans and
arrangements and receive any other benefits customarily provided by the Company
to its senior management personnel (including any profit sharing, pension,
short- and long-term disability insurance, hospital, major medical insurance
and group life insurance plans in accordance with the terms of such plans) and
including stock option and/or stock purchase plans, all as determined from time
to time by the GP Board, on a level commensurate with Executive’s seniority
(the “Benefit Plans”).  The
Company shall indemnify Executive to the fullest extent permitted by Delaware
law, including the advancement of legal expenses and costs.


 


6.             DUTIES.


 


(a)           Executive
shall perform such reasonable duties and functions as the Company Board and the
GP Board may lawfully assign to him, such duties being commensurate with the
duties customarily performed by chief executive officers of companies, and
Executive shall comply in the performance of his duties with the policies of
the Company Board and the GP Board, and be subject to the direction of the
Company Board and the GP Board.  At the
request of the GP Board, Executive shall serve as an executive officer, director
and manager of any member of the US Shipping Group engaged in the operation of
U.S.-flagged product tankers without additional compensation and, in the
performance of such duties, Executive shall comply with the policies of the
board of directors or board of managers of each such entity.  Executive shall serve, without additional
compensation, as Chairman and Chief Executive Officer of the General Partner,
Parent, the Partnership and each subsidiary of the Partnership and the General
Partner.


 


(b)           During
the Employment Term, Executive shall devote a majority of his time and
attention, reasonable vacation time and absences for sickness excepted, to the
business of the Company, as necessary to fulfill his duties.  Executive shall perform the duties assigned
to him with fidelity and to 


 


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the best of his ability. 
Notwithstanding anything herein to the contrary, but subject to the next
sentence of this Section 6(b), Executive may engage in other activities so long
as such activities do not unreasonably interfere with Executive’s performance
of his duties hereunder and do not violate Section 9 hereof.  The Company recognizes that Executive will be
devoting a significant minority of his time to the activities set forth on Schedule
A attached hereto.  The Company
agrees that Executive’s duties hereunder shall not require excessive travel
away from the New York metropolitan area, and that Executive need not be
physically present at the Company’s executive offices for a specific number of
days per month or year for the performance of his duties hereunder.


 


(c)           Nothing
contained in this Section 6 or elsewhere in this Agreement shall be construed
to prevent Executive from investing or trading in non-competing investments as
he sees fit for his own account, including real estate, stocks, bonds,
securities, commodities or other forms of investments.  Specifically, the Company acknowledges that
(i) the Executive has disclosed ownership interests in and management responsibilities
for the entities and assets listed on Schedule A attached hereto and
(ii) neither such ownership interests nor management responsibilities as they
exist as of the date hereof shall, subject to the first two sentences of
Section 6(b), violate this Section 6 or the other provisions of this Agreement.


 


7.             TERMINATION
OF EMPLOYMENT; EFFECT OF TERMINATION.


 


(a)           Executive’s
employment hereunder shall terminate upon the first to occur of the following:


 


(i)            upon
thirty (30) days’ prior written notice to Executive upon the determination by
the GP Board that Executive’s performance of his duties has not been fully
satisfactory for any reason which would not constitute “justifiable cause” (as
hereinafter defined);


 


(ii)           upon
three (3) days’ prior written notice to Executive upon the determination by the
GP Board that there is justifiable cause for such termination;


 


(iii)          automatically
and without notice upon the death of Executive;


 


(iv)          in
accordance with the terms of subsection (d) hereof upon the “disability” (as
hereinafter defined) of Executive;


 


(v)           upon
written notice by the Executive to the Company of a termination for good reason
(as hereinafter defined) within ninety (90) days after the event that
constitutes good reason; or


 


(vi)          upon
30 days’ prior written notice by Executive to the Company of the Executive’s
voluntary termination of employment without good reason.


 


(b)           For the
purposes of this Agreement, the term:


 


(i)            “disability”
shall mean the inability of Executive, due to illness, accident or any other
physical or mental incapacity, substantially to perform the material functions
of his duties for a period of six (6) consecutive months or for a total of
eight (8) months (whether or not consecutive) in any twelve (12) month period
during the term of this Agreement, as reasonably determined by the GP Board, in
good faith, after examination of Executive by an independent physician
reasonably acceptable to Executive.


 


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(ii)           “change of control” shall mean (A) the
occurrence of any transaction the result of which is that any person (other
than Parent, any entity controlled by Sterling Investment Partners L.P. or its
affiliates, or any entity in which Executive is an executive officer and/or
equity holder that is formed for the purpose of effecting the transaction that
would constitute a change of control and that, prior to effecting such
transaction, does not have any equity securities that are publicly traded)
acquires more than 50% of the outstanding equity of, or otherwise obtains the
right to appoint a majority of, the directors (or equivalent) of (x) the
General Partner or (y) Parent or (B) the sale of all or substantially all the
assets of the General Partner or Parent to any person other than an affiliate
of Parent, any entity controlled by Sterling Investment Partners L.P. or its
affiliates or any entity in which Executive is an executive officer and/or
equity holder that is formed for the purpose of effecting the transaction that
would constitute a change of control and that, prior to effecting such
transaction, does not have any equity securities that are publicly traded);


 


(iii)          “good reason” shall mean (i) any
material diminution of Executive’s duties, (ii) any change in Executive’s
reporting relationship that removes the Executive from reporting directly to
the GP Board, (iii) any change in Executive’s or another person’s duties that
provides such other person with substantially all the duties of chief executive
officer of the Company, Parent, the General Partner or any subsidiary of the
Partnership or the General Partner, or (iv) requiring Executive to be
physically present during a substantial portion of the working hours he is
required to devote to the Company at a location that is not within a 50 mile
radius of Manhattan, in each case that has not been remedied within thirty days
after written notice from Executive to the GP Board; and


 


(iv)          “justifiable cause” shall mean:  (i) Executive’s repeated failure or refusal
to attempt to perform his duties pursuant to, or Executive’s breach of, this
Agreement where such conduct or breach shall not have ceased or been remedied
within 15 days following written warning from the Company; (ii) Executive’s
performance of any act or his failure to act, for which if Executive were
prosecuted and convicted, a crime or offense involving money or property of the
US Shipping Group, or which would constitute a felony in the jurisdiction
involved, would have occurred; (iii) Executive’s performance of any act or his
failure to act which constitutes, in the reasonable good faith determination of
the GP Board, dishonesty, fraud or a breach of a fiduciary trust, including
without limitation misappropriation of funds; (iv) any intentional unauthorized
disclosure by Executive to any person, firm or corporation other than the
members of the US Shipping Group and their respective directors, managers,
officers and employees, of any confidential information or trade secret of the
US Shipping Group; (v) any attempt by Executive to secure any personal profit
(other than through his ownership of units of Parent or the Partnership and his
profits interest in the General Partner) in connection with the business of the
US Shipping Group (for example, without limitation, using US Shipping Group
assets to pursue other interests, diverting any business opportunity belonging
to US Shipping Group to himself or to a third party, insider trading or taking
bribes or kickbacks); (vi) Executive’s engagement in a fraudulent act to the
material damage of the US Shipping Group; (vii) Executive’s illegal use of
controlled substances; (viii) any act or omission by Executive involving
malfeasance or gross negligence in the performance of Executive’s duties to the
material detriment of the US Shipping Group, as determined in reasonable good
faith by the GP Board; or (ix) the entry of any order of a court that remains
in effect and is not discharged for a period of at least sixty (60) days, which
enjoins or otherwise limits or restricts the performance by Executive under
this Agreement, relating to any contract, agreement or commitment made by or
applicable to Executive in favor of any former employer or any other
person.  Upon termination of Executive’s
employment for justifiable cause, Executive shall not be entitled to any
amounts or benefits hereunder other than such portion of Executive’s annual
salary and reimbursement of 


 


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expenses pursuant to Section 4 hereof as has been
accrued through the date of his termination of employment.


 


(c)           If
Executive should die during the term of his employment hereunder, this
Agreement shall terminate immediately. 
In such event, the estate of Executive shall thereupon be entitled to
receive such portion of Executive’s annual salary and reimbursement of expenses
pursuant to Section 4 as has been accrued through the date of his death.  Executive shall also be entitled to any
amounts or benefits payable under the terms of the Benefit Plans.


 


(d)           Upon a
finding by the GP Board of Executive’s disability in accordance with Section
7(b) hereof, the Company shall have the right to terminate Executive’s
employment.  Notwithstanding any
inability to perform his duties, Executive shall be entitled to receive his
compensation (including bonus, if any) pursuant to Section 3 and reimbursement
of expenses pursuant to Section 4 as provided herein until he begins to receive
long-term disability insurance benefits under the policy provided by the
Company pursuant to Section 5 hereof.  In
the event that payments received from such long-term disability insurance
policy do not equal the Executive’s rate of salary at the time of the
disability, then for a period of 18 months following termination the Company
shall continue to pay to Executive the difference between the policy benefit
and such rate of salary, subject to any applicable tax withholding.  Any termination pursuant to this subsection
(e) shall be effective on the date Executive begins to receive long-term
disability insurance benefits under the policy provided by the Company pursuant
to Section 5 hereof. Executive shall also be entitled to receive any amounts or
benefits payable under the terms of the Benefit Plans.


 


(e)           Notwithstanding
any provision to the contrary contained herein, in the event that Executive’s
employment is terminated by the Company without justifiable cause or by the
Executive for good reason, the Company shall (i) pay Executive, for a period of
two years following the date of termination (such period being hereinafter
referred to as the “Severance Period”), a monthly payment (subject to
applicable tax withholding) equal to one-twelfth of his then annual salary and
one-twelfth of his target bonus for the year in which termination of employment
occurs, as established by the compensation committee of the GP Board (provided
that if the compensation committee has not established a target bonus for such
year, then for purposes of this Section 7(e) such target bonus shall be 50% of
Executive’s then current salary), which amount shall be in lieu of any and all
other payments due and owing to Executive under the terms of this Agreement
(other than any payments constituting reimbursement of expenses pursuant to
Section 4 hereof and any payments or benefits payable under the Benefit Plans),
and (ii) continue to allow Executive to participate, at the Company’s expense
(to the same extent the Company bears such expense at the time of termination),
in the Company’s health insurance program, to the extent permitted under such
programs, until the earlier of (1) the end of the Severance Period or (2) the
date Executive begins employment with another entity which provides
substantially similar benefits to the Executive (collectively, the “Severance
Payments”); provided, however, that the Company’s obligation to make the
Severance Payments shall be conditional upon Executive executing a general
release in favor of the Company and Executive’s compliance with his obligations
under Sections 9, 10 and 11 hereof; and provided further, that in the event
that Executive’s employment is terminated by the Company without justifiable cause
(including by reason of non-renewal of this Agreement) or by the Executive for good
reason within two years following the effective date of a change of control,
then the Company shall pay to Executive, in lieu of the amounts to be paid
pursuant to clause (i) of the first sentence of this Section 7(e), an amount
equal to the product determined by multiplying (x) the sum of his then annual
salary and his target bonus for the year in which termination of employment
occurs, as established by the compensation committee of the GP Board (provided
that if the compensation committee has not established a target bonus for such
year, then for purposes of this Section 7(e) such target bonus shall be 50% of
Executive’s then current salary), by (y) three, such payment to be made within
ten business days following such termination of employment.  If Executive’s employment is 


 


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terminated by the Company without justifiable cause (including by
reason of non-renewal of this Agreement) or by the Executive for good reason at
a time when the Partnership, the General Partner or Parent is in negotiations
regarding a transaction that would, if consummated, constitute a change of control
and such transaction is consummated within one year following Executive’s
termination of employment, then Executive’s severance shall be calculated and
paid as if such termination had occurred within two years following a change of
control, and the Company shall, upon consummation of such transaction, pay to
Executive an amount equal to the difference between the amount he would be
entitled to pursuant to this sentence and the amount of severance payments Executive
has received through such date.


 


(f)            Upon
Executive’s termination of his employment hereunder or his election not to
renew this Agreement, this Agreement (other than Sections 9, 10, 11 and 14
which shall survive in accordance with their terms) shall terminate.  In such event, Executive shall be entitled to
receive such portion of Executive’s annual salary and bonus, if any, as has
been accrued to date.  Executive shall be
entitled to reimbursement of expenses pursuant to Section 4 hereof and to continue
to participate in the Benefit Plans to the extent participation by former
employees is required by law or permitted by such plans, with the expense of
such participation to be as specified in such plans for former employees.  Executive shall also be entitled to any
amounts or benefits payable under the terms of the Benefit Plans.


 


8.             REPRESENTATIONS
AND AGREEMENTS OF EXECUTIVE.


 


(a)           Executive
represents and warrants that he is free to enter into this Agreement and to
perform the duties required hereunder, and that there are no employment
contracts or understandings, restrictive covenants or other restrictions,
whether written or oral, preventing the performance of his duties hereunder.


 


(b)           Executive
agrees to submit to a medical examination and to cooperate and supply such
other information and documents as may be reasonably required by any insurance
company in connection with the Company’s obtaining life insurance on the life
of Executive, and any other type of insurance or fringe benefit as the Company
shall determine from time to time to obtain.


 


9.             NON-COMPETITION.


 


(a)           In
view of the unique and valuable services expected to be rendered by Executive
to the US Shipping Group, Executive’s knowledge of the trade secrets and other
proprietary information relating to the business and in consideration of the
compensation to be received hereunder and Executive’s direct ownership interest
in the Parent and indirect ownership in the Partnership, Executive agrees that
during his employment by the Company and, following the termination of
Executive’s employment hereunder, during the Non-Competition Period (as defined
below), Executive shall not, directly or indirectly, as owner, partner, joint
venturer, stockholder, employee, broker, agent, principal, trustee, corporate
officer, director, licensor, or in any capacity whatsoever engage in, become
financially interested in, be employed by, render any consultation or business
advice with respect to, or have any connection with, (i) any business which is
competitive with products or services of the US Shipping Group in the United
States of America or (ii) any business conducted under any corporate or trade
name utilized by the US Shipping Group or any name similar thereto without the
prior written consent of the Company; provided, however, that Executive may own
any securities of any corporation which is engaged in such business and is
publicly owned and traded but in an amount not to exceed at any one time one
percent (1%) of any class of stock or securities of such corporation.  The Company hereby agrees that the following
activities shall not be deemed to be a business competitive with the business
of the US Shipping Group:


 


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(i)            employment, following termination of
employment hereunder, by any entity that is not engaged in the ownership and
operation of vessels engaged in the coastwise trade under the Jones Act;


 


(ii)           employment, following termination of
employment hereunder, by an entity that has divisions or affiliates engaged in
the ownership and operation of vessels engaged in the coastwise trade under the
Jones Act as long as Executive is employed in a division or affiliate of such
entity that does not, directly or indirectly, engage in the ownership and
operation of vessels engaged in the coastwise trade under the Jones Act and
Executive does not share information, directly or indirectly, with those
divisions and/or affiliates of such entity engaged in the ownership and
operation of vessels engaged in the coastwise trade under the Jones Act; or


 


(iii)          transportation of chemical products on
the tank barges listed on Schedule A hereto and, subject to the provisions of
Section 9(b) below, any other tank barges of less than 15,000 tons deadweight,
other than the transportation of petroleum or petroleum products, as long as
either (i) Mr. Gridley continues to engage in such business on a continuous
basis after the date hereof or (ii) if Mr. Gridley does not continue to engage
in such business on a continuous basis after the date hereof, at the time Mr.
Gridley determines to reenter such business, the US Shipping Group is not then
engaged in such business.


 


In addition, Executive shall not, directly or indirectly, during the
Non-Competition Period, request or cause any suppliers or customers with whom
the US Shipping Group has a business relationship to cancel or terminate any
such business relationship with any member of the US Shipping Group or solicit,
interfere with or entice from the Parent or any of its subsidiaries any
employee (or former employee) of the Parent or any of its subsidiaries.  For purposes hereof, the “Non-Competition
Period” shall mean:  (i) if Executive’s
employment is terminated by the Company for justifiable cause (as defined in
Section 7(b)) or disability (as defined in Section 7(b)), or if Executive
voluntarily terminates his employment hereunder (including by electing not to
renew this Agreement), a period of three (3) years following such termination
of employment; and (ii) if Executive’s employment is terminated by the Company
for other than justifiable cause or disability, by the Executive for good
reason, or as a result of the Company’s election not to renew the employment
agreement, the Severance Period, provided, however, that in the case of this
clause (ii) if the Company breaches its obligation to make the Severance
Payments or to comply with its obligations under Section 4 hereof, and such
breach is not cured within thirty (30) days after written notice of such breach
is provided to the Company by Executive, Executive shall be released from his
obligations under this Section 9.


 


(b)           Notwithstanding
Section 9(a) hereof, Executive agrees that during his employment by the Company
he will not, directly or indirectly, acquire an interest in any tank barge
(other than those listed on Schedule A hereto) of less than 15,000
deadweight tons if at any time more than 50% of the income expected to be
generated from the operation of such tank barge in a six month period is
expected to be “qualifying income” (within the meaning of Section 7704(d) of the
Code, or any successor provision thereto) without first offering to the
Partnership the opportunity to acquire such interest on the same terms and
conditions offered to him and the conflicts committee of the GP Board determining
that the Partnership is not interested in acquiring such interest; provided
that if at the time of acquisition less than 50% of the income expected to be
generated from the operation of such tank barge in a six-month period is
expected to be “qualifying income” and therefore was not offered to the
Partnership, but subsequently 50% or more of the income expected to be
generated from the operation of such tank barge in a six-month period is
expected to be “qualifying income,” then at such time Executive shall offer to
the conflicts committee of the GP Board the right to have the Partnership
acquire such tank barge (or Executive’s interest therein) at fair market value.


 


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(c)           If
any portion of the restrictions set forth in this Section 9 should, for any
reason whatsoever, be declared invalid by a court of competent jurisdiction,
the validity or enforceability of the remainder of such restrictions shall not
thereby be adversely affected.


 


(d)           Executive
acknowledges that the Parent has invested substantial monies in connection with
the acquisition of the Business (as defined in the Asset Purchase Agreement,
dated as of July 18, 2002, among Amerada Hess Corporation, United States
Shipping LLC (f/k/a US Shipping Acquisition LLC), a subsidiary of Parent, the
Company and the other signatories thereto (the “Purchase Agreement”))
from Hess and that the provisions of this Section 9 were a material inducement
to the US Shipping Group to consummate the transactions contemplated by the
Purchase Agreement (the “Acquisition”), and that the US Shipping Group
would not have consummated the Acquisition but for the agreements and covenants
contained herein.  Executive further
acknowledges that the territorial and time limitations set forth in this
Section 9 are reasonable and properly required for the adequate protection of
the business of the US Shipping Group. 
Executive hereby waives, to the extent permitted by law, any and all
right to contest the validity of this Section 9 on the ground of breadth of its
geographic or product and service coverage or length of term.  In the event any such territorial or time
limitation is deemed to be unreasonable by a court of competent jurisdiction,
Executive agrees to the reduction of the territorial or time limitation to the
area or period which such court shall deem reasonable.


 


(e)           The
existence of any claim or cause of action by Executive against the Company or
any other member of the US Shipping Group shall not constitute a defense to the
enforcement by the US Shipping Group of the foregoing restrictive covenants,
but such claim or cause of action shall be litigated separately.


 


10.           NON–DISCLOSURE
OF CONFIDENTIAL INFORMATION.


 


(a)           Executive
shall not, during the term of this Agreement, or at any time following
expiration or termination of this Agreement, directly or indirectly, disclose
or permit to be known (other than as is required in the regular course of his
duties (including without limitation disclosures to the Company’s advisors and
consultants) or as is required by law (in which case Executive shall give the
Company prior written notice of such required disclosure) or with the prior
written consent of the GP Board), to any person, firm or corporation, any
confidential information acquired by him during the course of, or as an
incident to, his employment hereunder, relating to the US Shipping Group, any
client of the US Shipping Group, or any corporation, partnership or other
entity owned or controlled, directly or indirectly, by any of the foregoing, or
in which any of the foregoing has a beneficial interest, including, but not
limited to, the business affairs of each of the foregoing.  Such confidential information shall include,
but shall not be limited to, proprietary technology, trade secrets, patented
processes, research and development data, know-how, market studies and
forecasts, competitive analyses, pricing policies, employee lists, personnel
policies, the substance of agreements with customers, suppliers and others,
marketing or dealership arrangements, servicing and training programs and
arrangements, customer lists and any other documents embodying such
confidential information.  This
confidentiality obligation shall not apply to any confidential information which
is known to Executive as a result of his professional business experience prior
to the date hereof or his involvement in the business activities set forth on Schedule
A hereof or which becomes publicly available from sources unrelated to the
US Shipping Group.


 


(b)           All
information and documents relating to the US Shipping Group as hereinabove
described (or other business affairs) shall be the exclusive property of the
Company, and Executive shall use commercially reasonable best efforts to
prevent any publication or disclosure thereof. 
Upon termination of Executive’s employment with the Company, all
documents, records, reports, writings and 


 


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other similar documents containing confidential information, including
copies thereof, then in Executive’s possession or control shall be returned and
left with the Company.


 


11.           SPECIFIC
PERFORMANCE.


 


Executive agrees that if he breaches, or threatens to
commit a breach of, any of the provisions of Sections 9 or 10 (the “Restrictive
Covenants”), the Company shall have, in addition to, and not in lieu of,
any other rights and remedies available to the Company under law and in equity,
the right to injunctive relief and/or to have the Restrictive Covenants
specifically enforced by a court of competent jurisdiction, without the posting
of any bond or other security, it being agreed that any breach or threatened
breach of the Restrictive Covenants would cause irreparable injury to the US
Shipping Group and that money damages would not provide an adequate remedy to
the Company.  Notwithstanding the
foregoing, nothing herein shall constitute a waiver by Executive of his right
to contest whether a breach or threatened breach of any Restrictive Covenant
has occurred.


 


12.           AMENDMENT
OR ALTERATION.


 


No amendment or alteration of the terms of this
Agreement shall be valid unless made in writing and signed by both of the
parties hereto.


 


13.           GOVERNING
LAW.


 


This Agreement shall be governed by and construed in
accordance with the laws of the State of New Jersey, including choice of law
rules, applicable to agreements made and to be performed therein.


 


14.           ALTERNATIVE
DISPUTE RESOLUTION.


 


Any controversy or claim arising out of or relating to
this Agreement, or the breach thereof, shall be settled by arbitration in New
York City by one (1) arbitrator in accordance with the Commercial Arbitration
Rules of the American Arbitration Association, and judgment upon the award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof.  Each party shall bear its own
costs (including legal fees and expenses) in the arbitration unless the
arbitrator determines otherwise.  Nothing
in this paragraph shall preclude any party from seeking a preliminary
injunction or other provisional relief, either prior to, during or after
invoking the procedures in this paragraph, if in its judgment such action is
necessary to avoid irreparable damage or to preserve the status quo.


 


15.           SEVERABILITY.


 


The holding of any provision of this Agreement to be
invalid or unenforceable by a court of competent jurisdiction shall not affect
any other provision of this Agreement, which shall remain in full force and
effect.


 


16.           WITHHOLDING.


 


The Company may deduct and withhold from the payments
to be made to Executive hereunder any amounts required to be deducted and
withheld by the Company under the provisions of any applicable statute, law,
regulation or ordinance now or hereafter enacted.


 


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17.           NOTICES.


 


Any notices required or permitted to be given
hereunder shall be sufficient if in writing, and if delivered by hand or
courier, or sent by certified mail, return receipt requested, to the addresses
set forth above or such other address as either party may from time to time
designate in writing to the other, and shall be deemed given as of the date of
the delivery or at the expiration of three days in the event of a mailing.


 


18.           COUNTERPARTS
AND FACSIMILE SIGNATURES.


 


This Agreement may be signed in counterparts with the
same effect as if the signatures to each counterpart were upon a single
instrument, and all such counterparts together shall be deemed an original of
this Agreement.  For purposes of this
Agreement, a facsimile copy of a party’s signature shall be sufficient to bind
such party.


 


19.           WAIVER
OR BREACH.


 


It is agreed that a waiver by either party of a breach
of any provision of this Agreement shall not operate, or be construed, as a
waiver of any subsequent breach by that same party.


 


20.           ENTIRE
AGREEMENT AND BINDING EFFECT.


 


This Agreement contains the entire agreement of the
parties with respect to the subject matter hereof, supersedes all prior and
contemporaneous agreements, both written and oral, between the parties with
respect to the subject matter hereof, and may be modified only by a written
instrument signed by each of the parties hereto.  This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective legal
representatives, heirs, distributors, successors and assigns, provided,
however, that Executive shall not be entitled to assign or delegate any of his
rights or obligations hereunder without the prior written consent of the
Company.  It is intended that Sections 9,
10 and 11 benefit each of the Company and each other member of the US Shipping
Group, each of which is entitled to enforce the provisions of Sections 9, 10
and 11.


 


21.           SURVIVAL.


 


Except as otherwise expressly provided herein, the
termination of Executive’s employment hereunder or the expiration of this
Agreement shall not affect the enforceability of Sections 9, 10 and 11 hereof.


 


22.           FURTHER
ASSURANCES.


 


The parties agree to execute and deliver all such
further documents, agreements and instruments and take such other and further
action as may be necessary or appropriate to carry out the purposes and intent
of this Agreement.


 


23.           CONSTRUCTION
OF AGREEMENT.


 


No provision of this Agreement or any related document
shall be construed against or interpreted to the disadvantage of any party
hereto by any court or other governmental or judicial authority by reason of
such party having or being deemed to have structured or drafted such provision.


 


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24.           HEADINGS.


 


The Section headings appearing in this Agreement are
for the purposes of easy reference and shall not be considered a part of this
Agreement or in any way modify, demand or affect its provisions.


 


IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date and year first above written.


 


	
   

  	
  USS VESSEL MANAGEMENT LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph P. Gehegan

  
	
   

  	
   

  	
   

  	
  Name: Joseph P. Gehegan

  
	
   

  	
   

  	
   

  	
  Title: President and Chief Operating Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Paul B. Gridley

  
	
   

  	
  Paul Gridley

  



 


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SCHEDULE A


 


Mr. Gridley has ownership interests in the following
corporations:


 


1.             Maritrac,
LLC – A company developing marine security and vessel tracking systems.


 


2.             USS
Holding, LLC (f/k/a United States Shipping LLC) –  Holds interests in the chemical barge Sea Crest.


 


3.             USS
Great Lakes LLC – Holds interest in the chemical barge Robert F. Deegan.


 


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