Signal Demands Arbitration on GLDD Design Modifications

  Signal Demands Arbitration on GLDD Design Modifications

Business Wire

MOBILE, Ala. -- April 16, 2013

Signal International, Inc., announced today that work toward the design of an
Articulated Tug/Barge Hopper Dredge for Great Lakes Dredge and Dock (GLDD) has
been discontinued. Signal and GLDD entered into a contract for the design and
build of an AT/B Hopper Dredge in August 2012, with construction originally
scheduled to begin in January 2013. According to Signal, the project has
undergone numerous delays and construction has not started due to a series of
major design changes initiated by GLDD. These ongoing requests for
modifications continued even past the revised construction start date. Signal
stated they have been working with GLDD to firm up the design but the
attendant escalating costs and schedule delays were not being addressed by
GLDD in an equitable manner.

Signal retained PA Consulting Group, a leading management, IT and technology
consulting firm, to conduct a strategic analysis of the program situation and
options. PA’s analysis included assessing the impact of GLDD-driven design
changes on the program cost and schedule, and options to improve the program.
The results of PA’s program modeling and analysis showed significant delay and
construction cost impacts from the changes, as well as a variety of mitigation
options that would reduce cost and schedule impacts if there were
reprogramming and schedule adjustments. A senior member of PA presented their
findings to GLDD and Signal management on March 21, 2013.

Signal CEO, Richard Marler, noted, “Our Company reaches out to customers when
we see a red flag on a program with the idea that risks can be reduced if both
sides understand the problem and work together to develop mitigating
solutions. The primary consideration is providing quality products that help
make our customers more successful while respecting the integrity of our
company, employees and community constituents.” GLDD’s response has been to
terminate Signal and find another shipyard to build the A/TB Dredge with a
substantially revised specification. Signal has demanded arbitration under the
Contract in order to resolve the dispute.

Signal International, Inc. is a leading supplier of marine and fabrication
services to the offshore, marine and naval industries. The core business is
construction, repair, and conversion of offshore drilling rigs, ships and
vessels. Recognized as one of the “Best Large Shipyards” for excellence in
safety, Signal is known for quality workmanship, on time and on budget.

Contact:

Signal International, Inc.
Kathleen Hewitt, +1-251-544-2621
khewitt@signalint.com
 
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