Update On FGH - Ocean Rig Dispute

Friede Goldman Halter, Inc. announced that Ocean Rig ASA has commenced arbitration proceedings in London against Friede Goldman Halter, Inc., and Friede Goldman Offshore, Inc., under the Completion Contracts, as amended, for the outfitting of Ocean Rig's two Bingo 9000 semi-submersible drilling rigs.

Separately, FGH announced that it has been advised by its lenders under its $110 million credit facility that the Company has violated certain of the covenants in the loan agreement. The Company disputes the lenders' assertions and has been in negotiations with the lenders regarding the parties' outstanding issues. There can be no assurance, however, that the Company and the lenders will reach a mutually agreeable resolution of those issues.