**Exhibit 10.1**

 

**FIRST AMENDMENT TO SECOND **AMENDEDAND RESTATED********CREDIT AGREEMENT

** **

**THIS FIRSTAMENDMENT TO****SECOND **AMENDED AND RESTATEDCREDIT AGREEMENT****, dated as of August 1, 2005 (this “**Amendment****”**), isentered into by and among **U.S. SHIPPING PARTNERS L.P.**, a Delaware limited partnership,**U.S. SHIPPINGOPERATING LLC**, a Delaware limited liability company, **ITB BALTIMORE LLC**,a Delaware limited liability company, **ITB GROTON LLC**, a Delawarelimited liability company, **ITB JACKSONVILLE LLC**, a Delaware limited liability company, **ITB MOBILE LLC**,a Delaware limited liability company, **ITB NEW YORK LLC**, a Delawarelimited liability company, **ITB PHILADELPHIA LLC**, a Delaware limited liability company, **USS CHARTERING LLC**,a Delaware limited liability company, **USCS CHEMICAL CHARTERING LLC**, aDelaware limited liability company, **USCS CHEMICAL PIONEER INC.**, aDelaware corporation and successor-by-conversion to USCS Chemical Pioneer LLC, **USCS CHARLESTON LLC**,a Delaware limited liability company, **USCS CHARLESTON CHARTERING LLC**,a Delaware limited liability company, **USCS ATB LLC**, a Delaware limitedliability company (each of the foregoing being individually called a “Borrower”and collectively, the “Borrowers”), the various financial institutionsas are or may become parties to the Credit Agreement as defined hereinafter(collectively, the “Lenders”), **CANADIAN IMPERIAL BANK OF COMMERCE**(“CIBC”), as administrative agent (in such capacity together with itssuccessors in such capacity, the “Administrative Agent”) for theLenders,**CIBC**,as letter of credit issuer (the “Letter of Credit Issuer”), and **KEYBANK NATIONALASSOCIATION**, as collateral agent (in such capacity, together withits successors in such capacity, the “Collateral Agent”) for the SecuredParties (as defined in the Credit Agreement hereinafter defined).

 

**W I T N E S S E T H:**

** **

**WHEREAS**,the Borrowers, the Lenders, the Letter of Credit Issuer, the AdministrativeAgent and the Collateral Agent have entered into that certain Second Amendedand Restated Credit Agreement dated as of November 3, 2004 (the “**Credit Agreement****”**).

 

**WHEREAS**,the Borrowers intend to increase the Commitments pursuant to Section 2.1.6of the Credit Agreement and to use the proceeds of the Credit Extensionsutilizing such increased Commitments (a) to acquire the M/V Gus W.Darnell, a vessel that has been operating for at least six months prior to suchacquisition by the Borrowers and (b) to construct one or more newarticulated tug-barge vessel in addition to the ATB (such vessels, the “NewATBs”).

 

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

 

**NOWTHEREFORE**, in consideration of the foregoing and the mutualagreements set forth herein, the parties hereto agree as follows:

 

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

 

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

 

(a)           The following defined term isinserted in Section 1.1 of the Credit Agreement immediately after thedefinition for “Credit Facility Pro Rata Share” and immediately before thedefinition for “Debt”:

 

“              “Darnell Acquisition Agreement”means that certain Memorandum of Agreement, dated July 5, 2005, by andbetween Wilmington Trust Company, not in its individual capacity but solely asOwner Trustee under the Owner Trust agreement dated September 11, 1985, as“Sellers” and MLP or its guaranteed nominee as “Buyers”, as amended orotherwise modified from time to time.”

 

(b)           Clause (f) of the definition of “Indebtedness”is amended (i) by inserting the text “or the Darnell Acquisition Agreement”immediately after the text “the ATB Construction Contract” and (ii) byinserting the text “provided, however, that any agreement to pay for thepurchase or construction of one or more vessels and other assets relating tosuch vessels upon the delivery of such acquired vessels where the acquisitionof such vessels and related assets are otherwise permitted under this Agreementshall not be deemed to be “Indebtedness” hereunder until the earlier of (a) thefirst date of delivery of any such vessel or other related asset in accordancewith such agreement or (b) the first date any payment (other than aninitial deposit) is made by any Borrower or Subsidiary for the purchase orconstruction of such vessel or other related asset” immediately before the text“; and”.

 

(c)           The definition of “Vessel Acquisition”is amended by inserting the text “but including the M/V Gus Darnell acquiredpursuant to the Darnell Acquisition Agreement” immediately after the text “excludingthe ATB”.

 

***SECTION 3.        ******Amendment of Section 3.1 ofthe Credit Agreement.******  Clause (c) ofSection 3.1 of the Credit Agreement is hereby amended by deleting therepayment schedule in its entirety and inserting the following schedule inlieu thereof:***

 
| **Date**                | ** ** | **Amount** | ** ** |
|-------------------------|------------|------------|------------|
| September 30, 2005 |       | $          | 375,000    |   |
| December 31, 2005  |       | $          | 462,549    |   |
| March 31, 2006     |       | $          | 462,549    |   |
| June 30, 2006      |       | $          | 462,549    |   |
| September 30, 2006 |       | $          | 462,549    |   |
| December 31, 2006  |       | $          | 462,549    |   |
| March 31, 2007     |       | $          | 1,541,829  |   |
| June 30, 2007      |       | $          | 1,541,829  |   |
| September 30, 2007 |       | $          | 1,541,829  |   |
| December 31, 2007  |       | $          | 1,541,829  |   |
| March 31, 2008     |       | $          | 3,083,658  |   |
| June 30, 2008      |       | $          | 3,083,658  |   |
| September 30, 2008 |       | $          | 3,083,658  |   |
| December 31, 2008  |       | $          | 3,083,658  |   |
| March 31, 2009     |       | $          | 3,083,658  |   |
| June 30, 2009      |       | $          | 3,083,658  |   |
| September 30, 2009 |       | $          | 3,083,658  |   |
| December 31, 2009  |       | $          | 64,217,166 |   |
| April 30, 2010     |       | $          | 64,217,167 |   |

 

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**SECTION 4.        *****Amendment of Section 7.2.7of the Credit Agreement.******  Section 7.2.7of the Credit Agreement is hereby amended by (a) deleting the text “orcommit to make” and (b) inserting the text “, expenditures for thepurchase of the M/V Gus W. Darnell pursuant to the Darnell AcquisitionAgreement and refurbishment of the M/V Gus W. Darnell in an amount not toexceed $30,000,000 in the aggregate,” immediately after the text “expendituresfor the ATB”.***

 

***SECTION 5.        ******Calculation of Consolidated ProForma EBITDA******. ***The parties hereto agree with the AdministrativeAgent that for each period that Consolidated Pro Forma EBITDA is calculatedafter the delivery of the M/V Gus W. Darnell to the Borrowers, Consolidated ProForma EBITDA shall be calculated after giving pro forma effect to theacquisition of the M/V Gus W. Darnell during the period as if such acquisition hadoccurred on the first day of such period.

 

**SECTION 6.        *****Ratification***.  Each Borrower hereby ratifies and confirmsall of the Obligations under the Credit Agreement and the other LoanDocuments.  This Amendment is anamendment to the Credit Agreement, and the Credit Agreement as amended hereby,is hereby ratified, approved and confirmed in each and every respect.

 

**SECTION 7.        *****Effectiveness***.  This Amendment shall be effective as of July 5,2005, *provided*thatthe conditions set forth in this Section 5 are satisfied:

 

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

 

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

 

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that (i) theexecution, delivery and performance of this Amendment has been duly authorizedby all requisite corporate action on the part of such Borrower; (ii) theCredit Agreement and each other Loan Document to which it is a party constitutevalid and legally binding agreements enforceable against such Borrower inaccordance with their respective terms, except as such enforceability may belimited by bankruptcy, insolvency, reorganization, moratorium, fraudulenttransfer or other similar laws relating to or affecting the enforcement ofcreditors’ rights generally and by general principles of equity, (iii) therepresentations and warranties by such Borrower contained in the CreditAgreement and in the other Loan Documents are true and correct on and as of thedate hereof in all material respects as though made as of the date hereof, exceptthose that by their terms relate solely as to an earlier date, in which eventthey shall be true and correct on and as of such earlier date, and (iv) noDefault or Event of Default exists under the Credit Agreement or any of theother Loan Documents.

 

**SECTION 8.        **ConditionsSubsequent***.  The Borrowers*** herebycovenant and agree that they

 

(a)           shall execute and deliver a Mortgage,substantially in the form of Exhibit G to the Credit Agreement, withintwenty (20) Business Days (or such timeframe as is acceptable to theAdministrative Agent) after the delivery of the M/V Gus W. Darnell to anyBorrower or Subsidiary of a Borrower;

 

(b)           shall deliver a Third Party Consent,substantially in the form of Exhibit K-2 to the Credit Agreement, dulyexecuted and delivered by each charterer who executes a time charter for anyperiod equal to or greater than two years with any Borrower or Subsidiary of aBorrower with respect to the M/V Gus W. Darnell***n***ot laterthan 180 days immediately following the execution of such charter; and

 

***(c)          ***shallnot, and shall not permit any of their respective Subsidiaries to, make anydisbursement of funds to any contractor for the construction of each of the NewATBs, other than the payment of a premium in an amount not in excess of $1,000,000with respect to purchasing an option to have the contractor construct each ofthe New ATBs, unless prior to any such disbursement each of the followingconditions shall have been satisfied with respect to each New ATB:  (i) one or more of the Borrowers, or awholly-owned Subsidiary thereof, shall have entered into a fixed priceconstruction contract, which may include a fluctuating speed bonus component,with the contractor for the construction of the New ATB at a total cost not inexcess of $48,000,000, with a construction period of no longer than 24 monthsand which is otherwise in form and substance reasonably satisfactory to theAdministrative Agent; (ii) the Borrowers, or a wholly-owned Subsidiarythereof, shall have obtained a completion bond, insurance policy, standbyletter of credit, deposit arrangement, or other arrangement, in an amount, uponterms and from parties that are reasonably satisfactory to the AdministrativeAgent, to assure the timely completion and certification of the New ATB withsuch arrangement to be maintained throughout the construction period; and (iii) theAdministrative Agent shall have received a consent and agreement to theassignment and creation of a security interest in the construction contractwith the contractor for the construction of the New ATB by the Borrowers, or awholly-owned Subsidiary thereof, to the Collateral Agent for 

 

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the benefit of theSecured Parties of all of the Borrowers’ and its Subsidiaries’ rights, titleand interests in, to and under the construction contract as security for theObligations.

 

**SECTION 9.        *****Governing Law; Severability;Entire Agreement***. **THIS****AMENDMENT****SHALL EACH BE DEEMED TO BE A CONTRACT MADEUNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUTREGARD TO ANY CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OFTHE LAW OF ANY OTHER JURISDICTION)**. Any provision of this Amendment or any other Loan Document which isprohibited or unenforceable in any jurisdiction shall, as to such provision andsuch jurisdiction, be ineffective to the extent of such prohibition orunenforceability without invalidating the remaining provisions of thisAmendment or such Loan Document or affecting the validity or enforceability ofsuch provision in any other jurisdiction. This Amendment and the other Transaction Documents constitute the entireunderstanding among the parties hereto with respect to the subject matterhereof and supersede any prior agreements, written or oral, with respectthereto.

 

**SECTION 10.      **Executionin Counterparts.  This Amendment maybe executed by the parties hereto in several counterparts, each of which shallbe executed by the Borrowers and the Administrative Agent and be deemed to bean original and all of which shall constitute together but one and the sameagreement.

 

***SECTION 11.      ***Successorsand Assigns.  This Amendment shall bebinding upon and shall inure to the benefit of the parties hereto and theirrespective successors and assigns; provided, however, that (a) noBorrower may assign or transfer its rights or obligations hereunder without theprior written consent of the Administrative Agent, the Letter of Credit Issuerand all Lenders; and (b) the rights of sale, assignment and transfer ofthe Lenders are subject to Section 10.11 of the Credit Agreement.

 

**SECTION 12.      *****Miscellaneous***.  (a) On and after the effectiveness ofthis Amendment, each reference in each Transaction Document to “the CreditAgreement”, “thereunder”, “thereof” or words of like importreferring to the Credit Agreement shall mean and be a reference to the CreditAgreement as amended or otherwise modified by this Amendment; (b) theexecution, delivery and effectiveness of this Amendment shall not, except asexpressly provided herein, operate as a waiver of any default of the Borroweror any right, power or remedy of the Administrative Agent, the Letter of CreditIssuer, the Collateral Agent or the Lenders under any of the Loan Documents,nor constitute a waiver of any provision of any of the Loan Documents; (c) thisAmendment is a Loan Document executed pursuant to the Credit Agreement andshall (unless otherwise expressly indicated therein) be construed, administeredand applied in accordance with the terms and provisions of the CreditAgreement; and (d) a facsimile signature of any party hereto shall bedeemed to be an original signature for purposes of this Amendment.

 

[Remainder of Page LeftIntentionally Blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to beexecuted by its officers thereunto duly authorized as of the date first abovewritten.

 
| ** ** | **BORROWERS**:                  |
|------------|---------------------------------|
|       |                            |   |
| ** ** | **U.S. SHIPPING PARTNERS L.P.** |
|       |                            |   |
|       | By:                             | US Shipping General Partner LLC, |
|       |                            | its General Partner |
|       |                            |   |
|       |                            |   |
|       | By:                             | /s/ Paul Gridley |   |
|       | Name:                           | Paul Gridley |
|       | Title:                          | Chairman and  Chief Executive Officer |
| ** ** | ** **                      |
| ** ** | **U.S. SHIPPING OPERATING LLC** |
|       |                            |   |
|       |                            |   |
|       | By:                             | /s/ Paul Gridley |   |
|       | Name:                           | Paul Gridley |
|       | Title:                          | Chairman and  Chief Executive Officer |
|            |                                 |  |  |  |

 
| ** ** | **ITB BALTIMORE LLC** |
|------------|-----------------------|
|       |                  |   |
|       |                  |   |
|       | By:                   | /s/ Paul Gridley |   |
|       | Name:                 | Paul Gridley |
|       | Title:                | Chairman and  Chief Executive Officer |
|            |                       |  |  |  |

 
| ** ** | **ITB GROTON LLC** |
|------------|--------------------|
|       |               |   |
|       |               |   |
|       | By:                | /s/ Paul Gridley |   |
|       | Name:              | Paul Gridley |
|       | Title:             | Chairman and  Chief Executive Officer |
|            |                    |  |  |  |

 
| ** ** | **ITB JACKSONVILLE LLC** |
|------------|--------------------------|
|       |                     |   |
|       |                     |   |
|       | By:                      | /s/ Paul Gridley |   |
|       | Name:                    | Paul Gridley |
|       | Title:                   | Chairman and  Chief Executive Officer |
|            |                          |  |  |  |

 

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| ** ** | **ITB MOBILE LLC** |
|------------|--------------------|
|       |               |   |
|       |               |   |
|       | By:                | /s/ Paul Gridley |   |
|       | Name:              | Paul Gridley |
|       | Title:             | Chairman and  Chief Executive Officer |
|            |                    |  |  |  |

** **
| ** ** | **ITB NEW YORK LLC** |
|------------|----------------------|
|       |                 |   |
|       |                 |   |
|       | By:                  | /s/ Paul Gridley |   |
|       | Name:                | Paul Gridley |
|       | Title:               | Chairman and  Chief Executive Officer |
|            |                      |  |  |  |

** **
| ** ** | **ITB PHILADELPHIA LLC** |
|------------|--------------------------|
|       |                     |   |
|       |                     |   |
|       | By:                      | /s/ Paul Gridley |   |
|       | Name:                    | Paul Gridley |
|       | Title:                   | Chairman and  Chief Executive Officer |
|            |                          |  |  |  |

** **
| ** ** | **USS CHARTERING LLC** |
|------------|------------------------|
|       |                   |   |
|       |                   |   |
|       | By:                    | /s/ Paul Gridley |   |
|       | Name:                  | Paul Gridley |
|       | Title:                 | Chairman and  Chief Executive Officer |
|            |                        |  |  |  |

** **
| ** ** | **USCS CHEMICAL CHARTERING LLC** |
|------------|----------------------------------|
|       |                             |   |
|       |                             |   |
|       | By:                              | /s/ Paul Gridley |   |
|       | Name:                            | Paul Gridley |
|       | Title:                           | Chairman and  Chief Executive Officer |
|            |                                  |  |  |  |

** **
| ** ** | **USCS CHEMICAL PIONEER INC.** |
|------------|--------------------------------|
|       |                           |   |
|       |                           |   |
|       | By:                            | /s/ Paul Gridley |   |
|       | Name:                          | Paul Gridley |
|       | Title:                         | Chairman and  Chief Executive Officer |
|            |                                |  |  |  |

** **

**S-2**

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** **
| ** ** | **USCS CHARLESTON CHARTERING LLC** |
|------------|------------------------------------|
|       |                               |   |
|       |                               |   |
|       | By:                                | /s/ Paul Gridley |   |
|       | Name:                              | Paul Gridley |
|       | Title:                             | Chairman and  Chief Executive Officer |
|            |                                    |  |  |  |

** **
| ** ** | **USCS CHARLESTON LLC** |
|------------|-------------------------|
|       |                    |   |
|       |                    |   |
|       | By:                     | /s/ Paul Gridley |   |
|       | Name:                   | Paul Gridley |
|       | Title:                  | Chairman and  Chief Executive Officer |
|            |                         |  |  |  |

** **
| ** ** | **USCS ATB LLC** |
|------------|------------------|
|       |             |   |
|       |             |   |
|       | By:              | /s/ Paul Gridley |   |
|       | Name:            | Paul Gridley |
|       | Title:           | Chairman and  Chief Executive Officer |
|            |                  |  |  |  |

** **

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**AGENTS AND LENDERS**:

 

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

 
| By:    |   |   |
|--------|--------|--------|
|   | Name:  |
|   | Title: |

** **

**KEYBANK NATIONAL ASSOCIATION,****asCollateral Agent and Lender**

** **

 
| By:           |   |   |
|---------------|--------|--------|
|          | Name:  |
|          | Title: |
|          |   |
|          |   |
|          | ,      |
| **as Lender** |
|               |        |        |  |

 

 
| By:    |   |   |
|--------|--------|--------|
|   | Name:  |
|   | Title: |

 

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