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August 12, 2002


Conrad to acquire Swiftships

Conrad Industries, Inc., Morgan City, Louisiana, has executed a letter of intent for the purchase of the assets of another Morgan City shipbuilder: Swiftships Shipbuilders, LLC and Swiftships Technologies, LLC, for approximately $12.5 million in cash. The Swiftships companies would also be eligible to receive an additional amount based on the performance of the assets during a three-year period after the closing. The Swiftships companies would use the proceeds of the asset sale to pay creditors. The letter of intent is non-binding with respect to the proposed acquisition, which is subject to the execution and closing of a definitive agreement.

Swiftships designs, builds, overhauls and repairs aluminum crew/supply boats, aluminum patrol boats and other marine vessels at two shipyards in Morgan City and employs approximately 130 people. During an over 30-year history, Swiftships and its predecessors have designed and constructed over 530 vessels ranging in size from 30 feet to 225 feet in length for domestic and foreign, commercial and government customers.

Conrad Industries, Inc., established in 1948 and headquartered in Morgan City, Louisiana designs, builds and overhauls tugboats, ferries, liftboats, barges, offshore support vessels and other steel and aluminum products. It provides repair and new construction services at its three shipyards located in southern Louisiana and Texas.

The letter of intent contains a binding exclusivity agreement. The Swiftships parties have agreed that before October 31, 2002 they will negotiate exclusively with Conrad and not solicit any competing acquisition proposal or enter into any agreement with respect to a competing acquisition proposal. If prior to the end of the exclusivity period or within 180 days thereafter, any of the Swiftships parties accepts or enters into any agreement with respect to any competing acquisition proposal, the Swiftships parties must pay Conrad a fee of $1 million payable at the time the transaction contemplated by the competing acquisition proposal is consummated.

In connection with the letter of intent, Conrad has entered into a loan agreement pursuant to which it has agreed to lend on a secured basis up to $500,000 from time to time to Swiftships Shipbuilders, LLC prior to the execution of a definitive asset purchase agreement and up to an additional $500,000 thereafter, for purposes approved by Conrad. The loan is due on the earlier of September 30, 2002 or the closing of a definitive asset purchase agreement.

Conrad President and CEO Kenneth G. "Jerry" Myers stated, "We believe Swiftships' aluminum crew/supply boats set the design and operational standards in the Gulf of Mexico against which others are measured. With Swiftships' experienced and dedicated workforce along with its designs and marketing expertise, Conrad will be able to significantly enhance and expand our products, services and customer base. Conrad will also gain entrance into the international commercial and government markets as Swiftships has successfully marketed and delivered products to over 75 countries over the past 30 years. The acquisition affords Conrad the opportunity for sustained growth in a different market segment than we currently operate. We are looking forward to working with the Swift companies to complete the acquisition process."


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