Friede Goldman Halter Announces Contract and Options Worth Up to $78 Million

Business Wire, May 25, 2001

Business Editors

GULFPORT, Miss.--(BUSINESS WIRE)--May 25, 2001

Friede Goldman Halter, Inc. (OTCBB:FGHLQ) was notified today by the offices of Senator Trent Lott (R-MS) and Senator Thad Cochran (R-MS) that Halter Marine, Inc., the Company's vessels segment, has been awarded a contract from the U.S. Army Tank and Automotive Command (TACOM) for the detailed design and construction of a Logistic Support Vessel (LSV). The contract includes provisions for spare parts, technical services, and options to build two additional LSVs. The total value of the base contract is $26.9 million, and could be worth upwards of $78 million once the options are exercised.

Engineering and construction at the Company's Halter Moss Point shipyard in Escatawpa, MS are scheduled to take about two years to complete. This project is expected to create approximately 75 new jobs at that yard.

The 313-foot LSV class vessels will have a beam of 60 feet and a molded depth of 19 feet. They are designed to carry over 2000 tons of deck cargo, and will be designed and built to the requirements of the American Bureau of Shipping.

"We are extremely pleased that the U.S. Army has chosen Halter for this very significant program," said Anil Raj, Chief Operating Officer of Friede Goldman Halter. "The government conducted a detailed review of our financial and technical capabilities before making this award. We appreciate the government's continued confidence in Halter's capabilities."

Halter has successfully completed numerous U.S. Army programs such as the Landing Craft Utility (LCU), the Large Tug (LT), and has already built all six (6) of the LSV's currently in the Army's fleet.

The newly constructed LSVs will be based in Hawaii and Baltimore, Maryland.

"Contracts such as this one and the recent letter of intent for a Supply Vessel contract are important reinforcements of the fact that governments and commercial concerns alike still maintain their confidence in our ability, and in our people," Raj continued. "With the exception of the Petrodrill program where we had not choice but to curtail our losses, work on our other projects continues, and negotiations continue to secure even more work in each of our segments. In the recent past, we have delivered two Power-Generation Barges, an Expeditionary Series yacht, and the world's largest SWATH-hull vessel. I am also really proud of the fortitude with which our employees have dedicated themselves during the reorganization."

Friede Goldman Halter is a world leader in the design and manufacture of equipment for the maritime and offshore energy industries. Its operating units are Friede Goldman Offshore (construction, upgrade and repair of drilling units, mobile production units and offshore construction equipment); Halter Marine (construction of vessels for commercial and governmental markets); FGH Engineered Products (design and manufacture of cranes, winches, mooring systems and other types of marine equipment); and Friede & Goldman Ltd. (naval architecture and marine engineering).

Note: This press release includes certain statements that may be deemed to be "forward-looking statements" within the meaning of Section 27A of The Securities Act of 1933, as amended, and Section 21 E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that Friede Goldman Halter expects, believes or anticipates will or may occur in the future, are forward-looking statements. These statements are based on certain assumptions and analyses made by Friede Goldman Halter, Inc. in light of its experience and its perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Friede Goldman Halter and which are discussed in Friede Goldman Halter's Registration Statement on Form S-1 and the Annual Report on Form 10-K. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements.