Shipbuilding Contract

Exhibit 10.2 SHIPBUILDING CONTRACTBetween MARITRANS OPERATING COMPANY, L.P. and BENDER SHIPBUILDING & REPAIR CO., INC. [**] Confidential Treatment


TABLE OF CONTENTS ARTICLE I - DESCRIPTION AND CLASS 6 A. Description: 6 B. Dimensions and Characteristics: 7 C. Classification, Rules and Regulations: 7 D. Subcontracting: 7 E. Maker' s List: 8 ARTICLE II - CONTRACT PRICE AND TERMS OF PAYMENT 8 A. Contract Price: 8 B. Terms of Payment: 8 ARTICLE III - ADJUSTMENT OF CONTRACT PRICE 9 A. Delivery: 10 B. Speed: 10 C. Fuel Consumption: 12 D. Noise and Vibration: 13 ARTICLE IV - APPROVAL OF PLANS AND DRAWINGS AND 16 INSPECTION DURING CONSTRUCTION A. Approval of Plans and Drawings: 16 B. Appointment of Buyer' s Representative: 17 C. Inspection by Buyer' s Representative: 17 D. Facilities: 18 E. Responsibility of Buyer: 18 ARTICLE V MODIFICATIONS 19 A. Modifications of Specifications: 19 B. Change in Class: 21 C. Substitution of Materials: 22 ARTICLE VI - TRIALS 22 A. Notice: 22 B. Weather Conditions: 22 C. How Conducted: 23 D. Method of Acceptance or Rejection: 23 E. Effect of Acceptance: 24 F. Disposition of Surplus Consumable Stores: 24 [**] Confidential Treatment 2


ARTICLE VII - PRODUCTION SCHEDULES AND PROGRESS MEETINGS 24 ARTICLE VIII - DELIVERY 25 A. Time and Place: 25 B. When and How Effected: 25 C. Documents to be Delivered to Buyer: 26 D. Tender of Units: 26 E. Title and Risk: 26 F. Removal of Units: 26 ARTICLE IX - DELAYS AND EXTENSION OF TIME FOR DELIVERY 27 A. Causes of Delay: 27 B. Notice of Delay: 28 C. Definition of Permissible Delay: 28 ARTICLE X - WARRANTY 28 A. Warranty: 28 B. Notice of Defects: 29 C. Remedy of Defects: 29 D. Extent of Builder' s Responsibility: 30 ARTICLE XI - BUILDER' S DEFAULT 30 A. Default by Builder: 31 B. Remedies for Builder' s Default: 31 ARTICLE XII - BUYER' S DEFAULT 32 A. Default by Buyer: 32 B. Remedies for Buyer' s Default: 33 ARTICLE XIII - INSURANCE 33 A. Builder' s Insurance: 33 B. Buyer' s Insurance: 35 ARTICLE XIV - DISPUTE RESOLUTION 35 ARTICLE XV - RIGHT OF ASSIGNMENT 36 ARTICLE XVI - TAXES 36 ARTICLE XVII - PATENTS, TRADEMARKS, COPYRIGHTS, ETC 37 [**] Confidential Treatment 3


A. Patents, Trademarks and Copyrights: 37 B. Specifications and Drawings: 37 ARTICLE XVIII - BUYER FURNISHED EQUIPMENT 37 A. Responsibility of Buyer: 37 B. Responsibility of Builder: 38 ARTICLE XIX - NOTICES 38 A. Address: 38 B. Language: 39 ARTICLE XX TITLE 39 ARTICLE XXI - INTERPRETATION 40 A. Laws Applicable: 40 B. Discrepancies: 40 C. Entire Agreement: 41 ARTICLE XXII - LIMITATION OF LIABILITY AND NO BROKERAGE 41 A. Limitation of Liability: 41 B. Brokerage: 42 ARTICLE XXIII - INDEMNITIES 42 A. Builder Indemnity: 42 B. Buyer Indemnity: 43 ARTICLE XXIV CONTRACT PERFORMANCE SECURITY 45 ARTICLE XXV - MISCELLANEOUS 46 A. Confidentiality: 46 B. Buyer' s Business Standards: 46 ARTICLE XXVI - EFFECTIVE DATE OF CONTRACT 46 [**] Confidential Treatment 4


EXHIBITS EXHIBIT A The Specifications 48 EXHIBIT B The Drawings 49 EXHIBIT C Milestone Payments 50 EXHIBIT D Protocol of Delivery and Acceptance 51 [**] Confidential Treatment 5


SHIPBUILDING CONTRACT THIS CONTRACT , dated as of this 2 nd day of September, 2005, by and between Bender Shipbuilding & Repair Co., Inc., a corporation organized and existing under the laws of Alabama (" Builder" ), having its principal office at 265 South Water Street, Mobile, AL 36603 (" the Shipyard" ), and Maritrans Operating Company, L.P., a limited partnership organized and existing under the laws of Delaware (" Buyer" ), having its principal office at Two Harbor Place, 302 Knights Run Ave., Tampa, FL 33602. WITNESSETH: In consideration of the mutual covenants herein contained, Builder agrees to design, build, launch, equip and complete at the Shipyard and sell and deliver to Buyer three (3) 342,000 BBL (@ 100%) Double Hull AT/B Tank Barges (" the Barges" ) and three 12,000 HP Tugs (" the Tugs" ) , as more fully described in Article I hereof (the Barges and the Tugs shall be connected in pairs hereinafter called " the Units" ). Buyer agrees to purchase and take delivery of the three Units from Builder at the Shipyard and to pay for the same, all upon the terms and conditions hereinafter set forth. " Barge" , " Tug" and " Unit" means any one of the Barges, Tugs and/or Units, respectively. ARTICLE I - DESCRIPTION AND CLASS A. Description: The Units shall have Builder' s Hull Nos.: 7800 Tug 1 7801 Barge 17900 Tug 2 7901 Barge 28000 Tug 3 8001 Barge 3 The Units shall be designed, constructed, equipped and completed in accordance with the provisions of this Contract, and the Specifications (" the Specifications" ) and Drawings (" Drawings" ) signed by each of the parties hereto for identification and attached hereto as Exhibits A and B and made an integral part hereof. [**] Confidential Treatment 6


B. Dimensions and Characteristics: Dimensions of each Unit: Overall length (as connected ATB) [**]Length of barge: [**]Length of tug: [**]Breadth molded (barge): [**]Breadth molded (tug): [**]Depth to main deck (barge): [**]Depth to main deck (tug): [**] The details of the above dimensions, as well as definitions and methods of measurements and calculations are more fully described in the Specifications. C. Classification, Rules and Regulations: 1. The Units, including their machinery, equipment and outfitting shall be constructed in accordance with the rules (as published and interpreted as of the date of this Contract, and the edition and amendments thereto being in force as of the date of this Contract) of and under special survey of the American Bureau of Shipping (herein called the " Classification Society" ), with the notation set out in the Specifications (herein referred to as the " Class" ). 2. Decisions of the Classification Society as to compliance or non-compliance with the rules thereof shall be final and binding upon both parties hereto. 3. The Units shall also comply with the rules, regulations and requirements of other regulatory bodies as described in the Specifications, as the same have been publicly interpreted and were in effect as of the date of this Contract. 4. All fees and charges incidental to the classification and with respect to compliance with the above referred rules, regulations and requirements shall be for account of Builder. D. Subcontracting: Builder may, at its sole discretion and responsibility, subcontract any portion of the construction work of the Units, provided however, that no such subcontract in excess of Two Hundred Thousand Dollars ($200,000) will be executed without Buyer' s prior written consent as to amount, work, and the subcontractor, which consent shall not be unreasonably withheld. Subject to the provisions of Article X, Builder will remain responsible to Buyer for the performance of any and all [**] Confidential Treatment 7


subcontractors and for any and all work by subcontractors. E. Maker' s List: Buyer has reviewed and approved the list of suppliers nominated by Builder for delivery of certain therein defined equipment, machinery and services (herein referred to as the " Maker' s List" ) signed by each of the parties hereto for identification and incorporated within the Specifications. Builder shall endeavor to select suppliers for the therein-defined equipment, machinery and services from the Maker' s List, and may, without the interference of Buyer, in its sole discretion, select between the different suppliers nominated therein. However, if Buyer requests Builder to order any equipment, machinery or services from a particular supplier listed on the Maker' s List, Builder will take all reasonable steps to comply with such request, provided that Buyer shall reimburse Builder any reasonable extra costs associated with such request. ARTICLE II - CONTRACT PRICE AND TERMS OF PAYMENT A. Contract Price: 1. The purchase price of the three Units is US$ Two hundred Twenty Nine Million, Three Hundred Eighty Three Thousand, Six Hundred Forty Eight dollars ($229,383,648), broken down as follows: Tug 1 $[**] Barge 1 $[**] Tug 2 $[**] Barge 2 $[**] Tug 3 $[**] Barge 3 $[**] (herein called the " Contract Price" ), which is exclusive of Buyer Furnished Equipment as provided in Article XVII hereof and shall be subject to upward or downward adjustment, if any, as hereinafter set forth in this Contract. 2. All applicable taxes, duties and tariffs imposed by federal, state or local laws as well as assessments of charges for social security, retirement and unemployment benefits, are the responsibility of the Builder and are included in the Contract Price. B. Terms of Payment: 1. The Contract Price shall be paid by Buyer to Builder in accordance with the milestone payment schedule which is attached hereto as Exhibit C. [**] Confidential Treatment 8


a. Although the progress payments are linked to Contractor' s completion of certain milestones, Contractor acknowledges that scheduling of all work is exclusively and solely the responsibility of Contractor, and that Contractor will not artificially manipulate the schedule of construction of the Vessel merely to achieve earlier milestone payments. b. Any milestone payment shall be due upon the completion of the milestone an no earlier than 15 days prior to the milestone date contained in Exhibit C. Within 45 days of the execution of this Contract, Builder will produce a modified Exhibit C containing mutually agreed milestone dates. 2. The Milestone Payment Schedule amounts shall be based upon an average price of each Unit rather than the actual price set forth in Art. II.A. 3. Buyer will pay Builder upon presentation of an invoice: a. The initial invoice will be paid within five (5) business days of receipt b. All other invoices will be paid within ten business (10) days of receipt. 4. Upon request of the Buyer, Builder shall demonstrate to the reasonable satisfaction of the Buyer that provision has been made for payment (unless such payment is disputed by Builder) to all contractors, subcontractors, or others for services performed on the Units, prior to payment by the Buyer for work performed by the Builder. Builder hereby agrees to provide Buyer with a full accounting on a monthly basis of expenditures made on the project, if requested. 5. If Owner can demonstrate a reasonable basis for a belief that the Shipyard may be financially unable to complete the Work required by this Contract or has breached Maritrans' Vendor Code of Conduct, Buyer [**] all of Builder' s books, records, and correspondence pertaining to the Contract, from the time of initial payment until 18 months after completion of the last Unit. ARTICLE III - ADJUSTMENT OF CONTRACT PRICE The Contract Price shall be subject to adjustment, as hereinafter set forth, in the event of the following contingencies (it being understood by both parties that any reduction of the Contract Price is by way of liquidated damages and not by way of penalty): [**] Confidential Treatment 9


A. Delivery: 1. For each Unit, if the Unit is not delivered on its respective Delivery Date, for every day after the Delivery Date the Contract Price for such Unit shall be reduced by deducting therefrom liquidated damages calculated as follows: 1 st through 30 th day $[**] per calendar day31 st through 90 th day $[**] per calendar day91 st through 210 th day $[**] per calendar day Provided, that prior to exercising such right to deduct any such liquidated damages, Buyer shall set forth in writing to Builder the amount (and related supporting calculations) of the liquidated damages claimed by Buyer. If Builder disputes any such claimed liquidated damages, then Buyer shall if requested provide a bank guaranty or other security reasonably satisfactory to the Builder in the amount of the disputed liquidated damages until such time as the dispute with respect to the underlying claim is resolved between the parties by mutual agreement or pursuant to Article XIV below. 2. If Buyer requests in writing that the delivery of any Unit be made earlier than the Delivery Date, and if the delivery of the Unit is made, in response to such request of Buyer, then, in such event, beginning with the first (1 st ) day prior to the Delivery Date, the Contract Price of the Units shall be increased by adding thereto US$[**] for each full day (it being understood that Builder' s acceptance of such request by Buyer for early delivery shall in no way be construed as a change or alteration of the Delivery Date under this Contract). B. Speed: 1. The parties agree that tank testing will be performed to ascertain the maximum speed of the Unit design. Testing methodology shall be subject to Buyer' s approval and in accordance with standard practices for model testing in tank basins. The tank testing may suggest design improvements to increase the speed of the Unit. a. Should model testing indicate a speed of less than the minimum Guaranteed Speed discussed in Subparagraph 2 below or Builder and Buyer should agree on changes to the model after initial model testing which would result in significant increases in speed performance (equal to or greater than 0.3 knots), Builder shall make changes to the model and, as necessary, to the Unit which are mutually agreed as the most cost effective changes to improve the speed of the Unit. The cost of such changes shall be borne by [**] Confidential Treatment 10


Builder, provided such cost shall not exceed $ [**] in the total construction costs for each Unit. Any cost above $[**] in model test and total Unit construction costs to improve the Guaranteed Speed of the Unit above that obtained through the model testing shall be borne by Buyer and such changes will be mutually agreed through a Change Order as to cost and schedule impact. b. Should model testing indicate a speed of greater than the minimum Guaranteed Speed discussed in Subparagraph 2 below, Buyer may request changes to the model to attempt to further optimize speed performance. Any changes to the model or the actual Unit requested by the Buyer to achieve speeds in excess of the Guaranteed Speed provided for in Subparagraph 2 below shall be mutually agreed as to cost and schedule impact and is subject to a Change Order. 2. The Guaranteed Speed of the Unit for both full and ballast conditions with the Unit operating at 100% MCR or about [**] KW per main engine and zero percent (0%) sea margin with the tug and barge at design draft will be [**] knots. Builder agrees that the Guaranteed Speed may be increased based on results of the model testing discussed in Subparagraph 1 above. Any increase in the final Guaranteed Speed above [**] knots will be based on the final model test results with a reduction applied based on a mutually agreed margin of error. This margin of error will, in no case, be less than [**] percent ([**])] of the model test speed results. Any increase in the Guaranteed Speed will be agreed at the conclusion of tank testing and a modification to this section of the Contract will be issued in accordance with Article V of this Contract. Should the model test results yield a speed result of less than [**] knots, the requirements of Subparagraph 1 above shall apply. 3. The actual speed for the delivered Unit will be determined with the Unit operating at 100% MCR or about [**] KW per main engine, at the fuel consumption required to achieve [**] KW, with the Tug and Barge at design draft. This trial run speed will be conducted in calm water and, to the extent possible, with no current. The Unit' s hull will be clean. The measured speed on sea trials will be adjusted in accordance with common Naval Architecture practices to account for variations in environmental conditions from calm water and zero sea margin conditions due to items such as sea state, wave height and direction, wind and current. 4. The Contract Price shall be changed by reason of the actual speed, as determined by the trial run, being less than the Guaranteed Speed of the Unit. The Contract Price shall be reduced by the amounts set out in the table below for each one tenth of one knot below the Guaranteed Speed: [**] Confidential Treatment 11


From 0 up to and including 1/10th' s of one knot below guarantee speed $[**] From greater than 1/10 th' s of one knot up to and including 2/10' s of one knot below guarantee speed $[**] From greater than 2/10 th' s of one knot up to and including 3/10' s of one knot below guarantee speed $[**] Greater than 3/10' s of one knot and up to and including 4/10 th' s of one knot below guarantee speed $[**] Greater than 4/10 th' s of one knot and up to and including 5/10 th' s of one knot below guarantee speed $[**] Greater than 5/10ths of one knot and up to and including 6/10ths of one knot below guarantee speed $[**] Greater than 6/10ths of one knot and up to and including 7/10ths of one knot below guarantee speed $[**] Each subsequent 1/10 th of one knot below guarantee speed $[**] 5. Buyer retains the right at its discretion to reject any Unit whose speed is less than [**] knots, and, in the case of such rejection, shall be entitled to exercise the remedies set out in this Contract. C. Fuel Consumption: 1. Fuel oil consumption at 4050 kW load (90 % of MCR) for the selected main engine and at a speed of 750 rpm (or according to propeller law) will not exceed [**] with a tolerance of [**] percent ([**]) (hereinafter referred to as " Guaranteed Fuel Oil Consumption" ) during test running at the engine manufacturer' s factory prior to the delivery. Guaranteed Fuel Oil Consumption shall be valid at reference conditions ISO 3046/I and a fuel net calorific heat value of 42.700 kJ/kg (10.200 kcal/kg) when running on available fuel without engine driven pumps. The leakage fuel in each engine will not be calculated into the consumption. 2. However, commencing with and including an excess of [**] percent ([**]) in the actual fuel consumption over the Guaranteed Fuel Oil Consumption, the Contract Price shall be reduced by the sum of $[**] per engine for each full [**] percent ([**]) increase in Fuel Oil Consumption above said [**] percent ([**]) (fractions of one percent (1%) to be prorated) to a maximum of [**]. [**] Confidential Treatment 12


3. Should the engine manufacturer, in order to meet the Fuel Oil Consumption guarantee, be required to make adjustments or modifications to any or all engines and any such adjustments or modifications result in a delay of delivery of any engine to the Builder from the mutually agreed scheduled delivery date, Builder will be entitled to up to [**] days of force majeure on a day for day basis for such late delivery. 4. Builder and Buyer agree that the fuel consumption figures and liquidated damages provided for in Subparagraphs 1 and 2 above are based on a specific engine manufacturer. Should another engine manufacturer be selected after execution of this Contract, the fuel consumption and liquidated damages provided by that manufacturer will apply without any additional cost or burden to Builder. A change to Subparagraphs 1 and 2 above will be issued as a modification to this Contract within forty eight (48) hours of final selection of an engine manufacturer if different from the manufacturer selected above. D. Noise and Vibration: 1. Noise a. The Unit will achieve noise requirements established by IMO Resolution A.468, Code for Noise Levels On Board Ship (" IMO A.468" ) for all accommodation spaces, navigation spaces and service spaces, including the barge office, in accordance with Sub-subparagraph c below. Measures to be undertaken are discussed comprehensively in the Specifications. b. To achieve the noise levels defined in Sub-subparagraph c below, Builder will install noise control hardware and materials as required by the Specifications, and other measures as stated in the Specifications. Those other measures may also include the strategic positioning of tanks located directly above the propellers so as to attenuate propeller induced noise, where possible. Builder will also retain the services of a qualified HVAC system subcontractor. HVAC systems will be analyzed for noise in accordance with procedures defined in, ASHRAE 1999, Chapter 46, " Sound and Vibration Control" . HVAC systems will be designed with a goal that HVAC system noise contributions are at least approximately [**] below the limits stated in IMO A.468 such that when machinery noise contributions are present, the total noise level in a ship compartment does not exceed the levels. c. Builder will achieve compliance with IMO A.468 standards for the navigation bridge (65-dBA) and for all offices (65-dBA) at 01 deck [**] Confidential Treatment 13


and above and for all accommodation space cabins (60-dBA) at 01 deck and above. For all other accommodation space cabins, mess rooms, and office spaces located on main deck or those accommodation space cabins or office spaces which, by arrangement, are located adjacent to any machinery spaces, connection/coupler systems or in close proximity to propellers, Builder will achieve a noise level between [**]. Galleys, pantries, recreation rooms, and exercise rooms at main deck level will be at a maximum of [**], as required by IMO A.468. d. Any noise level that exceeds the requirements stated above will be investigated by Builder' s selected noise analyst. The cost of such noise analyst will be to the account of Builder. This noise analyst will develop a comprehensive list of recommended corrective actions and specific elements of this list will be acted upon by Builder as discussed below, to the reasonable satisfaction of the noise analyst and Buyer. Builder may, at its discretion, elect to implement those measures which it considers to be most cost effective in reducing the noise levels to those spaces mentioned above and Builder will expend up to $[**] per Unit on corrective actions which are considered by the Builder and the Builder' s assigned noise analyst to be the most cost effective measures to achieve the required noise levels. This $[**], or any portion thereof, will be the cost for changes to the first Unit only. These same changes will be applied to all subsequent Units. However, upon expenditure of this $[**], Builder may, at its discretion, elect to pay liquidated damages specified herein in lieu of taking such corrective action should the cost of any or all corrective action exceed the value of the liquidated damages to be paid under this section. Further: (1) Should, upon completion of corrective actions taken by the Builder, the noise level problem persist or is mitigated only to a level which is still above the required levels stated above, Builder shall pay liquidated damages of $[**] per decibel per space above the required levels to a maximum level of [**] decibels above the required noise level. The liquidated damages under this section will be limited to a total of $[**]. (2) Should the noise levels in any accommodation or control space, after corrective action has been taken by the Builder, exceed the levels stated above by greater than [**] decibels, Builder will pay liquidated damages in the amount of [**] per decibel per space in excess of [**] decibels above the required noise level. The liquidated damage to be paid for cases where noise levels exceed by greater than [**] [**] Confidential Treatment 14


decibels above the required noise levels will be limited to a total of $[**]. (3) Buyer may elect to refuse to accept the Unit for any noise level in any accommodation or control space at 01 level or above which exceeds the guaranteed levels of Paragraph D.1.(c). above by greater than 10 decibels or any other space identified in Paragraph D.1.(c) which is equal to or greater than [**]. 2. Vibration a. The Units will meet the Specification requirements regarding vibration limits as set out in ISO 6954, " Mechanical Vibration and Shock - Guidelines for the Overall Evaluation of Vibration in Merchant Ships" for peak acceleration less than or equal to 285mm/s 2 for the frequency range of [**] and for peak velocity less than or equal to 9 mm/s for the frequency range [**]. b. During the engineering design phase Builder will retain the services of the propulsion engine manufacturer selected by Buyer to perform a propulsion system torsional analysis. Builder will also retain the services of a qualified noise and vibration analysis firm such as BBN Technologies to perform a comprehensive whole ship (hull and superstructure) finite element vibration analysis using methods defined in the Specifications. c. Predicted vibration levels during the design phase will be compared against the specified vibration limits to verify vibration compliance. If excessive vibration is predicted, Builder will undertake reasonable corrective measures such as selection of a specific alternate propeller, local stiffening of structure, or inclusion of additional vibration dampening material into the ship design. d. Any vibration level that exceeds the requirements stated above will be investigated by Builder' s selected vibration analyst. The cost of such vibration analyst will be to the account of Builder. This vibration analyst will develop a comprehensive list of recommended corrective actions and each element of this list will be acted upon by Builder to the reasonable satisfaction of the vibration analyst and Buyer. If, upon completion of all directed corrective actions, the vibration level exceeds the standard required in Article III.D.2.(a), Buyer may elect to refuse to accept the vessel. [**] Confidential Treatment 15


ARTICLE IV - APPROVAL OF PLANS AND DRAWINGS AND
INSPECTION DURING CONSTRUCTION A. Approval of Plans and Drawings: 1. Builder shall submit to Buyer four (4) hard copies and one (1) electronic copy via e-mail or on CD-ROM of the plans, drawings, and calculations required to be submitted thereto for its review. Buyer or Buyer' s designated Engineering representative shall, within twenty one (21) calendar days after earliest receipt thereof, respond to Builder, either through hard copy or electronically via e mail, with Buyer' s comments, if any, either written on the plans thereon or in a comment letter referencing the plan, drawing or calculation. All hard copy drawing, plan and calculation submissions between Buyer and Builder will be by overnight delivery through a well established courier service, the cost of such courier service being borne by the sender. Buyer will, in response to any drawing, plan or calculation submission from Builder, designate each drawing formally as either " Approved without comment" , " Approved with Comments" or " Not Approved" . Builder and Buyer will coordinate their efforts to ensure that the twenty one (21) calendar day review time is reduced to the minimum interval consistent with effective review through mutually agreed drawing development and submission schedules and timely assignment of adequate personnel to the tasks of review. Builder may formally request expedited review for plans, drawings and calculations. Buyer agrees to consider each such request on a case by case basis and advise Builder of ability to meet the requested date and any delays to other review tasks but is in under no obligation to accept expedited review. Builder shall submit to the Regulatory Agencies, the plans, drawings and calculations that require their approval. Copies of all correspondence between the Builder and the Regulatory Agencies as well as all hard copies of plans, drawings and calculations returned stamped by the Regulatory Agencies shall be submitted immediately to the Buyer in hard copy or in electronic files shared through Builder' s electronic file system. 2. When and if Buyer' s Representative shall have been sent by Buyer to Builder in accordance with Paragraph B of this Article, Builder shall provide the Buyer' s Representative at any and all Builder sites where a Buyer' s Representative is assigned one (1) hard copy of the latest revisions of all previously approved drawings. This Buyer' s Representative, regardless of where located, will be provided one information hard copy of all drawing, plan and calculation submissions to Buyer addressed in Subparagraph 1 above. 3. Plans, drawings and calculations must be submitted for review and approval by the Owner and Regulatory Agencies prior to their use for the [**] Confidential Treatment 16


construction of the vessel. Plans, drawings and calculations must be reviewed and returned by the Owner within twenty one (21) calendar days of receipt by the Owner. If the plans, drawings or calculations are not returned by the Owner within twenty one (21) working days, they shall be deemed to be approved. Should the Builder begin work covered by a plan, drawing, calculation, etc. being reviewed by the Owner prior to the Owner' s return of the drawing by the time specified herein, the Builder shall be responsible for all remediation and additional work to complete the work to satisfy the Owner' s comments w ...