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                                                                    EXHIBIT 10.2

                                                                  EXECUTION COPY

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                CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT

                                      AMONG

                              K-SEA INVESTORS L.P.,

                            K-SEA TRANSPORTATION LLC,

                                EW HOLDING CORP.,

                           K-SEA TRANSPORTATION CORP.,

                       K-SEA TRANSPORTATION PARTNERS L.P.

                                       AND

                        K-SEA OPERATING PARTNERSHIP L.P.


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                                TABLE OF CONTENTS

<Table>
<S>                                                                                             <C>
ARTICLE I DEFINITIONS............................................................................3
   Section 1.1   Definitions.....................................................................3

ARTICLE II RECORDATION..........................................................................10
   Section 2.1   Recordation of Evidence of Ownership of Assets.................................10

ARTICLE III TRANSACTIONS........................................................................10
   Section 3.1   K-Sea Corp Transactions........................................................10
   Section 3.2   EWH Transactions...............................................................11
   Section 3.3   KST LLC Transactions...........................................................12
   Section 3.4   Consideration for the Conveyance of the Conveyed Assets........................13
   Section 3.5   Public Cash Contribution.......................................................13
   Section 3.6   Partnership Receipt of Contribution; Payment of Expenses; Contribution.........13
   Section 3.7   Merger into Operating Partnership..............................................13
   Section 3.8   Distribution of General Partner Interests......................................13
   Section 3.9   Contribution to Operating Partnership..........................................13
   Section 3.10  Operating Partnership Use of Proceeds..........................................13
   Section 3.11  K-Sea Transportation Inc.......................................................14

ARTICLE IV ADDITIONAL TRANSACTIONS..............................................................14
   Section 4.1   Exercise of the Over-Allotment Option..........................................14

ARTICLE V TITLE MATTERS.........................................................................14
   Section 5.1   Encumbrances...................................................................14
   Section 5.2   Disclaimer of Warranties; Subrogation; Waiver of Bulk Sales Laws...............14

ARTICLE VI FURTHER ASSURANCES...................................................................16
   Section 6.1   Further Assurances.............................................................16
   Section 6.2   Power of Attorney..............................................................17
   Section 6.3   Access to Books and Records....................................................17

ARTICLE VII MISCELLANEOUS.......................................................................17
   Section 7.1   Order of Completion of Transactions............................................17
   Section 7.2   Consents.......................................................................17
   Section 7.3   Costs..........................................................................18
   Section 7.4   Governing Law; Submission to Jurisdiction......................................18
   Section 7.5   Entire Agreement; Supersedure..................................................18
   Section 7.6   Amendment or Modification......................................................18
   Section 7.7   Successors and Assigns.........................................................18
   Section 7.8   No Third Party Rights..........................................................18
   Section 7.9   Counterparts...................................................................19
   Section 7.10  Severability...................................................................19
   Section 7.11  Gender, Parts, Articles and Sections...........................................19
</Table>

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SCHEDULES

Schedule 1.1(a)      -   Vessels

Schedule 1.1(b)      -   Dry Cargo Barges

Schedule 1.1(c)      -   Notes

Schedule 1.1(d)      -   Bareboat Chartered Vessels


EXHIBITS

Exhibit 3.1(a)       -   Agreement and Plan of Merger between K-Sea Corp and
                         Corp5

Exhibit 3.1(b)       -   Agreement and Plan of Merger between Corp5 and LP5

Exhibit 3.1(c)       -   Agreement and Plan of Merger between Corp5 and New KST
                         Corp

Exhibit 3.2(a)       -   Agreement and Plan of Merger between EWH and Corp4

Exhibit 3.2(b)       -   Agreement and Plan of Merger between Corp4 and LP4

Exhibit 3.2(c)       -   Agreement and Plan of Merger between Corp4 and New EWH

Exhibit 3.3(a)       -   Agreement and Plan of Merger between KST LLC and LP1

Exhibit 3.3(b)       -   Agreement and Plan of Merger between LP1 and LP2

Exhibit 3.3(c)       -   Agreement and Plan of Merger among LP1, GP1 and New KST
                         LLC

Exhibit 3.7          -   Agreement and Plan of  Merger  among  LP2, GP2, LP4,
                         GP4, LP5, GP5 and the Operating Partnership

Exhibit 3.11         -   Form of Bareboat Charter between the Operating
                         Partnership and K-Sea Transportation Inc.

                                       ii
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                CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT

                  THIS CONTRIBUTION, CONVEYANCE AND ASSUMPTION AGREEMENT (this
"AGREEMENT") is entered into on, and effective as of, January 14, 2004 (the
"CLOSING DATE") by and among K-Sea Investors L.P., a Delaware limited
partnership ("K-SEA INVESTORS"), K-Sea Transportation LLC, a Delaware limited
liability company and majority owned subsidiary of K-Sea Investors ("KST LLC"),
EW Holding Corp., a New York corporation and wholly owned subsidiary of KSA (as
defined below) ("EWH"), K-Sea Transportation Corp., a New York corporation and
wholly owned subsidiary of EWH ("K-SEA CORP" and, together with KST LLC, EWH and
K-Sea Acquisition Corp., a Delaware corporation and wholly owned subsidiary of
KST LLC ("KSA"), the "K-SEA GROUP"), K-Sea Transportation Partners L.P., a
Delaware limited partnership (the "PARTNERSHIP"), and K-Sea Operating
Partnership L.P., a Delaware limited partnership and wholly owned indirect
subsidiary of the Partnership (the "OPERATING PARTNERSHIP").

                                 R E C I T A L S

         1.       The Partnership and the Operating Partnership have been formed
pursuant to the Delaware Revised Uniform Limited Partnership Act for the purpose
of, among other things, acquiring, owning and operating the assets of the K-Sea
Group used in the business of providing refined petroleum product marine
transportation, distribution and logistics services.

         2.       In furtherance of accomplishing the objectives set forth in
the foregoing recital, the following actions have been taken prior to the date
hereof:

         a.       Timothy J. Casey ("CASEY") formed K-Sea General Partner GP
                  LLC, a Delaware limited liability company in which he owned
                  all of the limited liability company interests ("GENERAL
                  PARTNER GP").

         b.       Casey transferred 0.01% of his interest in K-Sea General
                  Partner LLC, a Delaware limited liability company and the
                  former general partner of the Partnership (the "FORMER GP"),
                  to General Partner GP.

         c.       The Former GP converted from a Delaware limited liability
                  company to a Delaware limited partnership named K-Sea General
                  Partner L.P. (the "GENERAL PARTNER"), with General Partner GP
                  owning a 0.01% general partner interest therein, Casey owning
                  a 99.99% limited partner interest therein and the General
                  Partner being the general partner of the Partnership and
                  owning a 2% general partner interest therein.

         d.       The Partnership formed K-Sea OLP GP, LLC, a Delaware limited
                  liability company in which it owns all of the limited
                  liability company interests ("OLP GP").

         e.       The Partnership and OLP GP formed the Operating Partnership,
                  in which OLP GP owns a 0.01% general partner interest and the
                  Partnership owns a 99.99% limited partner interest.

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         f.       The Operating Partnership formed K-Sea Transportation Inc., a
                  Delaware corporation in which it owns all of the capital
                  stock. ("K-SEA TRANSPORTATION INC.").

         g.       Casey transferred (i) his 99.99% limited partner interest in
                  the General Partner to KST LLC and (ii) his 100% member
                  interest in General Partner GP to KST LLC.

         h.       The Partnership redeemed Casey's 98% limited partner interest
                  in the Partnership, and KST LLC was issued 665,000 common
                  units and 2,983,182 subordinated units in the Partnership and
                  EWH and K-Sea Corp were issued 727,273 and 454,545
                  subordinated units, respectively, in the Partnership,
                  representing in the aggregate a 98% limited partner interest
                  therein.

         i.       The certain members of the management of the K-Sea Group that
                  are also members of KST LLC (the "K-SEA MEMBERS") and K-Sea
                  Investors formed K-Sea GP1, LLC, a Delaware limited liability
                  company in which K-Sea Investors owns 98.3% and the K-Sea
                  Members (as a group) own 1.7% of the limited liability company
                  interests ("GP1").

         j.       K-Sea Investors, the K-Sea Members and GP1 formed K-Sea LP1,
                  L.P., a Texas limited partnership in which GP1 owns a 0.01%
                  general partner interest and K-Sea Investors and the K-Sea
                  Members collectively own a 99.99% limited partner interest
                  ("LP1").

         k.       LP1 formed K-Sea GP2, LLC, a Delaware limited liability
                  company in which it owns all of the limited liability company
                  interests ("GP2").

         l.       LP1 and GP2 formed K-Sea LP2, L.P., a Texas limited
                  partnership in which GP2 owns a 0.01% general partner interest
                  and LP1 owns a 99.99% limited partner interest ("LP2").

         m.       New K-Sea Transportation LLC, a Delaware limited liability
                  company to which each member of KST LLC transfers its interest
                  in KST LLC in return for membership interests in New K-Sea
                  Transportation LLC ("NEW KST LLC"), was formed.

         n.       EWH formed K-Sea GP4, LLC, a Delaware limited liability
                  company in which it owns all of the limited liability company
                  interests ("GP4").

         o.       EWH and GP4 formed K-Sea LP4, L.P., a Texas limited
                  partnership in which GP4 owns a 0.01% general partner interest
                  and EWH owns a 99.99% limited partner interest ("LP4").

         p.       EWH formed K-Sea Transition4 Corp., a Texas corporation in
                  which it owns all of the capital stock ("CORP4").

         r.       Corp4 formed New EW Holding Corp., a Delaware corporation in
                  which it owns all of the capital stock ("NEW EWH").

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         s.       K-Sea Corp formed K-Sea GP5, LLC, a Delaware limited liability
                  company in which it owns all of the limited liability company
                  interests ("GP5").

         t.       K-Sea Corp and GP5 formed K-Sea LP5, L.P., a Texas limited
                  partnership in which GP5 owns a 0.01% general partner interest
                  and K-Sea Corp owns a 99.99% limited partner interest ("LP5").

         u.       K-Sea Corp formed K-Sea Transition5 Corp., a Texas corporation
                  in which it owns all of the capital stock ("CORP5").

         v.       Corp5 formed New K-Sea Transportation Corp., a Delaware
                  corporation in which it owns all of the capital stock ("NEW
                  KST CORP").

         3.       In connection with the closing of the initial public offering
by the Partnership of its common units (the "OFFERING"), the transactions set
forth in Article III will occur.

         4.       In connection with the transactions described in the foregoing
recitals, this Agreement provides for and effectuates additional transactions
relating to the closing of the Offering.

                                    ARTICLE I
                                   DEFINITIONS

         Section 1.1 DEFINITIONS. As used in this Agreement, the following terms
shall have the respective meanings set forth below:

                 "ACTION" means any action, suit, proceeding, condemnation,
         investigation, inquiry or audit by or before any court or other
         Governmental Authority, whether of a civil, criminal, administrative,
         investigative or private nature, or any arbitration proceeding or
         alternative dispute resolution procedure.

                 "AFFILIATE" means, with respect to any Person, any other
         Person that directly or indirectly through one or more intermediaries
         controls, is controlled by or is under common control with, the Person
         in question. As used herein, the term "control" means the possession,
         direct or indirect, of the power to direct or cause the direction of
         the management and policies of a Person, whether through ownership of
         voting securities, by contract or otherwise.

                 "AGREEMENT" means this Contribution, Conveyance and Assumption
         Agreement, as amended, modified or supplemented from time to time in
         accordance with the terms hereof.

                 "ATTORNEY-IN-FACT" shall have the meaning ascribed to such
         term in Section 6.2.

                 "BENEFICIAL OWNER" shall have the meaning ascribed to such
         term in Section 7.2.

                 "BFI CONTRACT" means the letter agreement naming K-Sea Corp as
         the primary marine subcontractor for Allied Waste for municipal waste
         contracts in New York City.

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                 "CAPITAL STOCK" means, with respect to any Person, any
         corporate capital stock, membership interests in a limited liability
         company, limited or general partner equity interests in a partnership
         or any other equity interest in such Person.

                 "CASEY" shall have the meaning ascribed to such term in
         recital 2(a).

                 "CLOSING DATE" shall have the meaning ascribed to such term in
         the preamble.

                 "COMPANY ASSETS" means, with respect to any member of the
         K-Sea Group, all of the assets, properties and rights (whether or not
         included below) of such member of the K-Sea Group, including, without
         limitation, the following:

                       (i)    all vessels of such member of the K-Sea Group,
         including, without limitation, the vessels set forth on SCHEDULE 1.1(a)
         hereto, together with all of such vessels' appurtenances, parts,
         instruments, accessories and other equipment installed thereon and all
         stores, fuel oil and lube oil on board any such vessel and all
         insurance policies, cover notes and entries respecting insurance on
         such vessels and proceeds therefrom;

                       (ii)   all bareboat charters, time charters, contracts
         of affreightment, voyage charters, leases, contracts and other
         agreements of such member of the K-Sea Group;

                       (iii)  all cash, cash equivalents, deposits and other
         current assets of such member of the K-Sea Group;

                       (iv)   copies of all books, operating and financial
         records, correspondence, files, vendor lists, customer lists, customer
         account information, sales brochures and other data used in or relating
         to the business of such member of the K-Sea Group;

                       (v)    all intellectual property, including patents,
         trademarks, trade names and other names used in the business of such
         member of the K-Sea Group, trade secrets, fictitious names, service
         marks, designs, literature, logos, business cards, stationery and
         advertising materials used in the business of such member of the K-Sea
         Group, and all computer software owned or licensed by such member of
         the K-Sea Group and used in the business of such member of the K-Sea
         Group;

                       (vi)   interests in all leases and licenses of furniture,
         equipment, supplies, vehicles, computer hardware or software, offices
         and properties used in the business of such member of the K-Sea Group;

                       (vii)  all  maintenance, development and support
         agreements to which such member of the K-Sea Group is a party;

                       (viii) all office furniture, supplies, radio
         equipment, vehicles, computer systems, tools, equipment and fixed
         assets (including fixtures), leasehold improvements

                                        4
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         located in the offices of such member of the K-Sea Group in Staten
         Island, New York or elsewhere or otherwise used in the business of such
         member of the K-Sea Group;

                       (ix)   all licenses, permits, consents, approvals,
         authorizations, qualifications and orders of Governmental Authorities
         relating to such member of the K-Sea Group, to the extent that any of
         the foregoing may be transferred (upon any filing, application or other
         action by such member of the K-Sea Group or other Person);

                       (x)    all goodwill of such member of the K-Sea Group;

                       (xi)   such other assets of such member of the K-Sea
         Group as are incidental to, related to, required to and necessary to
         operate the current business of such member of the K-Sea Group; and

                       (xii)  all rights under express or implied warranties,
         if any, from suppliers, manufacturers or others with respect to any of
         the foregoing.

                 "CONVEYED ASSETS" means, collectively, the EWH Conveyed
         Assets, the K-Sea Corp Conveyed Assets and the KST LLC Conveyed Assets.

                 "CONVEYED LIABILITIES" means, collectively, the EWH Conveyed
         Liabilities, the K-Sea Corp Conveyed Liabilities and the KST LLC
         Conveyed Liabilities.

                 "CONVEYING PARTIES" shall have the meaning ascribed to such
         term in Section 6.2.

                 "CORP4" shall have the meaning ascribed to such term in
         recital 2(p).

                 "CORP5" shall have the meaning ascribed to such term in
         recital 2(u).

                 "COVERED INJURIES" means any injury caused or alleged to be
         caused by exposure to asbestos or secondary or passive smoke.

                 "EWH" shall have the meaning ascribed to such term in the
         preamble.

                 "EWH CONVEYED ASSETS" means all Company Assets of EWH
         immediately prior to the effectiveness of the transactions provided for
         by this Agreement, excluding the EWH Retained Assets.

                 "EWH CONVEYED LIABILITIES" means all liabilities and
         obligations incurred with respect to the EWH Conveyed Assets, (i)
         including, without limitation, the EWH Title XI Liabilities, and (ii)
         excluding the EWH Retained Liabilities.

                 "EWH RETAINED ASSETS" means all right, title and interest in
         and to (i) the dry cargo barges described on SCHEDULE 1.1(b) hereto,
         (ii) any capital stock of New KST Corp, New EWH, GP4, LP4 or the
         Partnership, (iii) the Joint Venture Interest, (iv) any minute books,
         tax returns, stock records and other corporate documents of EWH, (v)
         all of the assets, properties and rights of Corp4 immediately prior to
         the effectiveness of the transactions provided for by this Agreement
         and (vi) all rights under express or implied

                                        5
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         warranties, if any, from suppliers, manufacturers or others with
         respect to any of the foregoing.

                 "EWH RETAINED LIABILITIES" means any and all liabilities and
         obligations of any and every kind or character of (i) EWH arising out
         of or relating to (x) Special Toxic Tort Losses and (y) the Put
         Agreement, and (ii) Corp4 immediately prior to the effectiveness of the
         transactions provided for by this Agreement.

                 "EWH TITLE XI LIABILITIES" means any and all liabilities and
         obligations of EWH for the Title XI Liabilities.

                 "FORMER GP" shall have the meaning ascribed to such term in
         recital 2(b).

                 "GENERAL PARTNER" shall have the meaning ascribed to such term
         in recital 2(c).

                 "GENERAL PARTNER GP" shall have the meaning ascribed to such
         term in recital 2(a).

                 "GOVERNMENTAL AUTHORITY" means (i) the United States of
         America, (ii) any state, province, county, municipality or other
         governmental subdivision within the United States of America, (iii) any
         court or any governmental department, commission, board, bureau, agency
         or other instrumentality of the United States of America, or of any
         state, province, county, municipality or other governmental subdivision
         within the United States of America, and (iv) any arbitration tribunal
         having jurisdiction over any member of the K-Sea Group, the Partnership
         or the Operating Partnership.

                 "GP1" shall have the meaning ascribed to such term in recital
         2(i).

                 "GP2" shall have the meaning ascribed to such term in recital
         2(k).

                 "GP4" shall have the meaning ascribed to such term in recital
         2(n).

                 "GP5" shall have the meaning ascribed to such term in recital
         2(s).

                 "JOINT VENTURE INTEREST" means the capital stock owned by EWH
         of EMR Investment Corp., a Delaware corporation, and the 50% ownership
         by such company of the capital stock of Tug Emma M. Roehrig, LLC, a New
         York limited liability company.

                 "KSA" shall have the meaning ascribed to such term in the
         preamble.

                 "K-SEA CORP" shall have the meaning ascribed to such term in
         the preamble.

                 "K-SEA CORP CONVEYED ASSETS" means all Company Assets of K-Sea
         Corp immediately prior to the effectiveness of the transactions
         provided for by this Agreement, excluding the K-Sea Corp Retained
         Assets.

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                 "K-SEA CORP CONVEYED LIABILITIES" means all liabilities and
         obligations incurred with respect to the K-Sea Corp Conveyed Assets,
         (i) including, without limitation, the K-Sea Corp Title XI Liabilities,
         and (ii) excluding the K-Sea Corp Retained Liabilities.

                 "K-SEA CORP RETAINED ASSETS" means all right, title and
         interest in and to (i) the BFI Contract, (ii) any capital stock of New
         KST Corp, GP5, LP5 or the Partnership, (iii) any minute books, tax
         returns, stock records and other corporate documents of K-Sea Corp,
         (iv) all of the assets, properties and rights of Corp5 immediately
         prior to the effectiveness of the transactions provided for by this
         Agreement, (v) any intercompany receivables due from KSA or KST LLC and
         (vi) all rights under express or implied warranties, if any, from
         suppliers, manufacturers or others with respect to any of the
         foregoing.

                 "K-SEA CORP RETAINED LIABILITIES" means any and all liabilities
         and obligations of any and every kind or character of (i) K-Sea Corp
         arising out of or relating to (x) Special Toxic Tort Losses and (y) the
         Put Agreement, and (ii) Corp5 immediately prior to the effectiveness of
         the transactions provided for by this Agreement.

                 "K-SEA CORP TITLE XI LIABILITIES" means any and all liabilities
         and obligations of K-Sea Corp for the Title XI Liabilities.

                 "K-SEA GROUP" shall have the meaning ascribed to such term in
         the preamble.

                 "K-SEA INVESTORS" shall have the meaning ascribed to such term
         in the preamble.

                 "K-SEA MEMBERS" shall have the meaning ascribed to such term
         in recital 2(i).

                 "K-SEA TRANSPORTATION INC." shall have the meaning ascribed to
         such term in recital 2(f).

                 "KST LLC" shall have the meaning ascribed to such term in the
         preamble.

                 "KST LLC CONVEYED ASSETS" means all Company Assets of KST LLC
         immediately prior to the effectiveness of the transactions provided for
         by this Agreement, excluding the KST LLC Retained Assets.

                 "KST LLC CONVEYED LIABILITIES" means all liabilities and
         obligations incurred with respect to the KST LLC Conveyed Assets, (i)
         including, without limitation, the KST LLC Title XI Liabilities, and
         (ii) excluding the KST LLC Retained Liabilities.

                 "KST LLC RETAINED ASSETS" means all right, title and interest
         in and to (i) any capital stock of KSA, GP2, LP2, General Partner GP,
         the General Partner or the Partnership, (ii) any minute books, tax
         returns, stock records and other limited liability company documents of
         KST LLC, (iii) all of the assets, properties and rights of LP1
         immediately prior to the effectiveness of the transactions provided for
         by this Agreement, (iv) proceeds arising out of or relating to the
         Petroleum Tax Dispute, (v) any amounts due or otherwise payable to KST
         LLC pursuant to the Member Notes and (vi) all rights under

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         express or implied warranties, if any, from suppliers, manufacturers or
         others with respect to any of the foregoing.

                 "KST LLC RETAINED LIABILITIES" means any and all liabilities
         and obligations of any and every kind or character of (i) KST LLC
         arising out of or relating to (x) Special Toxic Tort Losses, (y) any
         intercompany payables due to K-Sea Corp and (z) the Put Agreement, and
         (ii) LP1 immediately prior to the effectiveness of the transactions
         provided for by this Agreement.

                 "KST LLC TITLE XI LIABILITIES" means any and all liabilities
         and obligations of KST LLC for the Title XI Liabilities.

                 "LOSSES" means any losses, damages, liabilities, claims,
         demands, causes of action, judgments, settlements, fines, penalties,
         costs, and expenses (including, without limitation, court costs and
         reasonable attorney's fees and expert's fees) of any and every kind or
         character.

                 "LP1" shall have the meaning ascribed to such term in recital
         2(j).

                 "LP2" shall have the meaning ascribed to such term in recital
         2(l).

                 "LP4" shall have the meaning ascribed to such term in recital
         2(o).

                 "LP5" shall have the meaning ascribed to such term in recital
         2(t).

                 "MARITRANS NOTE" means the 8.5% Subordinated Note (dated
         December 21, 1999) due December 21, 2005 from KST LLC to Maritrans
         Operating Partners L.P.

                 "MEMBER NOTES" means the indebtedness of various Persons to
         KST LLC set forth on SCHEDULE 1.1(c) hereto.

                 "NEW EWH" shall have the meaning ascribed to such term in
         recital 2(r).

                 "NEW KST CORP" shall have the meaning ascribed to such term in
         recital 2(v).

                 "NEW KST LLC" shall have the meaning ascribed to such term in
         recital 2(m).

                 "NET OFFERING PROCEEDS" shall have the meaning ascribed to
         such term in Section 3.6.

                 "OFFERING" shall have the meaning ascribed to such term in
         recital 3.

                 "OFFERING PROCEEDS" shall have the meaning ascribed to such
         term in Section 3.5.

                 "OLP GP" shall have the meaning ascribed to such term in
         recital 2(d).

                 "OPERATING PARTNERSHIP" shall have the meaning ascribed to
         such term in the preamble.

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                 "PARTNERSHIP" shall have the meaning ascribed to such term in
         the preamble.

                 "PERSON" means an individual or a corporation, limited
         liability company, partnership, joint venture, trust, unincorporated
         organization, association, government agency or political subdivision
         thereof or other entity.

                 "PETROLEUM TAX DISPUTE" means that dispute related to claims
         by predecessors of K-Sea Corp. for refunds of petroleum business taxes
         paid in the early 1990s in respect of periods during the 1980s.

                 "PREDECESSOR COMPANIES" means each member of the K-Sea Group
         and their respective predecessors, A & C Ship Fueling Corp., Barge E 57
         Corp., Egret Marine Corp., Eklof Transportation Co., Inc., Gowanus
         Marine Corp., Island Park Tanker Corp., Narrows Tanker Corp., Odin
         Marine Corp., Solvent Tanker Corp., South Bay Fuel Transportation,
         Inc., Thor Towing Corp., Wallin Marine Corp. and any controlled
         Affiliate of the foregoing.

                 "PUT AGREEMENT" means the Put Agreement dated November 14, 2001
         by KST LLC, EWH and K-Sea Corp in favor of LaSalle National Leasing
         Corporation.

                 "RESTRICTION" shall have the meaning ascribed to such term in
         Section 7.2.

                 "RESTRICTION ASSET" shall have the meaning ascribed to such
         term in Section 7.2.

                 "RETAINED ASSETS" means, collectively, the EWH Retained Assets,
         the K-Sea Corp Retained Assets and the KST LLC Retained Assets.

                 "RETAINED LIABILITIES" means, collectively, the EWH Retained
         Liabilities, the K-Sea Corp Retained Liabilities and the KST LLC
         Retained Liabilities.

                 "REVERTER AGREEMENT" means that certain Reverter Agreement,
         Contract No. MA-13888, dated as of December 24, 2003 by and among K-Sea
         LLC, KSA, EWH, K-Sea Corp, LP1, LP2, Corp4, LP4, Corp5, LP5, New KST
         LLC, New EWH, New KST Corp, the Partnership, the Operating Partnership
         and the Secretary.

                 "SECRETARY" means the United States of America, represented by
         the Secretary of Transportation, acting by and through the Maritime
         Administrator.

                 "SPECIAL TOXIC TORT LOSSES" means all Losses suffered or
         incurred by reason of or arising out of any past, current or future
         Action initiated by or on behalf of any Person, including, without
         limitation, any current, retired or deceased seaman or contractor,
         seeking any damages for Covered Injuries attributable to events or
         conditions that occurred or existed, or that are alleged to have
         occurred or existed, prior to the Closing Date aboard vessels or on any
         premises at any time owned, leased or otherwise operated by any of the
         Predecessor Companies.

                 "TBCA" means the Texas Business Corporation Act.

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                 "TERM LOANS" means the loans to various Persons set forth on
         SCHEDULE 1.1(c) hereto.

                 "TITLE XI LIABILITIES" means all liabilities described in the
         Security Agreement, Contract No. MA-13781, dated June 7, 2002, as
         amended by Security Agreement Amendment No. 1 dated June 27, 2003 and
         Security Agreement Amendment No. 2 dated June 27, 2003 by and among
         K-Sea LLC, EWH and the Secretary relating to the obligations designated
         "United States Government Guaranteed Ship Financing Obligations, K-Sea
         Series 2002-1, 2002-2, 2002-3 and 2002-4" in an original aggregate
         principal amount of $40,441,000 to finance a portion of the cost of
         construction of DBL 101 (O.N. 1119760), DBL 81 (O.N. 1132231), DBL 82
         (O.N. 1137538) and Hull No. 422, to be known as DBL 102.

                 "TRLPA" means the Texas Revised Limited Partnership Act.

                                   ARTICLE II
                                   RECORDATION

         Section 2.1 RECORDATION OF EVIDENCE OF OWNERSHIP OF ASSETS . In
connection with the conveyances and mergers contemplated by or provided for in
this Agreement, the parties acknowledge that certain jurisdictions in which the
assets of the applicable parties to such conveyances or mergers are located may
require that documents be recorded by the entities resulting from such
conveyances and mergers in order to evidence title to the assets owned by such
entities. All such documents shall evidence such new ownership and are not
intended to and shall not modify any of the terms, covenants or conditions set
forth in this Agreement.

                                   ARTICLE III
                                  TRANSACTIONS

         Section 3.1 K-SEA CORP TRANSACTIONS.

                 (a)      K-Sea Corp shall merge with and into Corp5, with
Corp5 being the surviving entity, pursuant to the agreement and plan of merger
attached hereto as EXHIBIT 3.1(a).

                 (b)      Corp5 and LP5 shall merge under Section 5.01 of the
TBCA and Section 2.11 of the TRLPA, with both Corp5 and LP5 surviving the
merger, pursuant to the agreement and plan of merger attached hereto as EXHIBIT
3.1(b). The assets and liabilities of Corp5 prior to such merger shall be
allocated to Corp5 and LP5 in accordance with the TBCA and the TRLPA in the
following manner:

                          (i)    All of the K-Sea Corp Conveyed Assets shall be
owned by LP5.

                          (ii)   All of the K-Sea Corp Retained Assets shall
be owned by Corp5.

                          (iii)  LP5 hereby assumes and agrees to duly and
timely pay, perform and discharge all of the K-Sea Corp Conveyed Liabilities, to
the full extent that Corp5 has been heretofore or would have been in the future
obligated to pay, perform and discharge the K-Sea Corp Conveyed Liabilities were
it not for such merger and the execution and delivery of this

                                       10
<Page>

Agreement; PROVIDED, HOWEVER, that said assumption and agreement shall not (x)
increase the obligation of LP5 with respect to the K-Sea Corp Conveyed
Liabilities beyond that of Corp5, (y) waive any valid defense that was available
to Corp5 with respect to the K-Sea Corp Conveyed Liabilities or (z) enlarge any
rights or remedies of any third party under any of the K-Sea Corp Conveyed
Liabilities.

                          (iv)   Corp5 hereby assumes and agrees to duly and
timely pay, perform and discharge all of the K-Sea Corp Retained Liabilities, to
the full extent that Corp5 has been heretofore or would have been in the future
obligated to pay, perform and discharge the K-Sea Corp Retained Liabilities were
it not for such merger and the execution and delivery of this Agreement;
PROVIDED, HOWEVER, that said assumption and agreement shall not (x) increase the
obligation of Corp5 with respect to the K-Sea Corp Retained Liabilities beyond
that of Corp5 before such merger, (y) waive any valid defense that was available
to Corp5 before such merger with respect to the K-Sea Corp Retained Liabilities
or (z) enlarge any rights or remedies of any third party under any of the K-Sea
Corp Retained Liabilities.

                 (c)      Corp5 shall merge with and into New KST Corp, with
New KST Corp being the surviving entity, pursuant to the agreement and plan of
merger attached hereto as EXHIBIT 3.1(c).

         Section 3.2  EWH TRANSACTIONS.

                 (a)      EWH shall merge with and into Corp4, with Corp4 being
the surviving entity, pursuant to the agreement and plan of merger attached
hereto as EXHIBIT 3.2(a).

                 (b)      Corp4 and LP4 shall merge under Section 5.01 of the
TBCA and Section 2.11 of the TRLPA, with both Corp4 and LP4 surviving the
merger, pursuant to the agreement and plan of merger attached hereto as EXHIBIT
3.2(b). The assets and liabilities of Corp4 prior to such merger shall be
allocated to Corp4 and LP4 in accordance with the TBCA and the TRLPA in the
following manner:

                          (i)    All of the EWH Conveyed Assets shall be owned
by LP4.

                          (ii)   All of the EWH Retained Assets shall be owned
by Corp4.

                          (iii)  LP4 hereby assumes and agrees to duly and
timely pay, perform and discharge all of the EWH Conveyed Liabilities, to the
full extent that Corp4 has been heretofore or would have been in the future
obligated to pay, perform and discharge the EWH Conveyed Liabilities were it not
for such merger and the execution and delivery of this Agreement; PROVIDED,
HOWEVER, that said assumption and agreement shall not (x) increase the
obligation of LP4 with respect to the EWH Conveyed Liabilities beyond that of
Corp4, (y) waive any valid defense that was available to Corp4 with respect to
the EWH Conveyed Liabilities or (z) enlarge any rights or remedies of any third
party under any of the EWH Conveyed Liabilities.

                          (iv)   Corp4 hereby assumes and agrees to duly and
timely pay, perform and discharge all of the EWH Retained Liabilities, to the
full extent that Corp4 has been heretofore or would have been in the future
obligated to pay, perform and discharge the EWH Retained Liabilities were it not
for such merger and the execution and delivery of this

                                       11
<Page>

Agreement; PROVIDED, HOWEVER, that said assumption and agreement shall not (x)
increase the obligation of Corp4 with respect to the EWH Retained Liabilities
beyond that of Corp4 before such merger, (y) waive any valid defense that was
available to Corp4 before such merger with respect to the EWH Retained
Liabilities or (z) enlarge any rights or remedies of any third party under any
of the EWH Retained Liabilities.

                 (c)      Corp4 shall merge with and into New EWH, with New EWH
being the surviving entity, pursuant to the agreement and plan of merger
attached hereto as EXHIBIT 3.2(c).

         Section 3.3  KST LLC TRANSACTIONS.

                 (a)      KST LLC shall merge with and into LP1, with LP1 being
the surviving entity, pursuant to the agreement and plan of merger attached
hereto as EXHIBIT 3.3(a).

                 (b)      LP1 and LP2 shall merge under Section 2.11 of the
TRLPA, with both LP1 and LP2 surviving the merger, pursuant to the agreement and
plan of merger attached hereto as EXHIBIT 3.3(b). The assets and liabilities of
LP1 prior to such merger shall be allocated to LP1 and LP2 in accordance with
the TRLPA in the following manner:

                          (i)    All of the KST LLC Conveyed Assets shall be
owned by LP2.

                          (ii)   All of the KST LLC Retained Assets shall be
owned by LP1.

                          (iii)  LP2 hereby assumes and agrees to duly and
timely pay, perform and discharge all of the KST LLC Conveyed Liabilities, to
the full extent that LP1 has been heretofore or would have been in the future
obligated to pay, perform and discharge the KST LLC Conveyed Liabilities were it
not for such merger and the execution and delivery of this Agreement; PROVIDED,
HOWEVER, that said assumption and agreement shall not (x) increase the
obligation of LP2 with respect to the KST LLC Conveyed Liabilities beyond that
of LP1, (y) waive any valid defense that was available to LP1 with respect to
the KST LLC Conveyed Liabilities or (z) enlarge any rights or remedies of any
third party under any of the KST LLC Conveyed Liabilities.

                          (iv)   LP1 hereby assumes and agrees to duly and
timely pay, perform and discharge all of the KST LLC Retained Liabilities, to
the full extent that LP1 has been heretofore or would have been in the future
obligated to pay, perform and discharge the KST LLC Retained Liabilities were it
not for such merger and the execution and delivery of this Agreement; PROVIDED,
HOWEVER, that said assumption and agreement shall not (x) increase the
obligation of LP1 with respect to the KST LLC Retained Liabilities beyond that
of LP1 before such merger, (y) waive any valid defense that was available to LP1
before such merger with respect to the KST LLC Retained Liabilities or (z)
enlarge any rights or remedies of any third party under any of the KST LLC
Retained Liabilities.

                 (c)      LP1 and GP1 shall merge with and into New KST LLC,
with New KST LLC being the surviving entity, pursuant to the agreement and plan
of merger attached hereto as EXHIBIT 3.3(c).

                                       12
<Page>

         Section 3.4 CONSIDERATION FOR THE CONVEYANCE OF THE CONVEYED ASSETS.
The parties to this Agreement acknowledge that KST LLC, EWH and K-Sea Corp
received 665,000 of the Partnership's common units and 4,165,000 of the
Partnership's subordinated units as consideration for agreeing to convey the
Conveyed Assets to the Operating Partnership.

         Section 3.5 PUBLIC CASH CONTRIBUTION. The parties to this Agreement
acknowledge a capital contribution of $85,187,500 in cash ($23.50 per common
unit) from the public to the Partnership in respect of the Offering and in
exchange for 3,625,000 common units representing limited partner interests in
the Partnership (the "OFFERING PROCEEDS").

         Section 3.6 PARTNERSHIP RECEIPT OF CONTRIBUTION; PAYMENT OF EXPENSES;
CONTRIBUTION. The Partnership acknowledges receipt of the Offering Proceeds as
a capital contribution to the Partnership, and the parties to this Agreement
acknowledge that the Partnership has used all of the Offering Proceeds to (i)
pay the underwriting discounts and expenses incurred by the Partnership in
connection with the Offering that are due and payable or that have been
previously paid, (ii) pay structuring fees of $425,900 to Lehman Brothers Inc.
and UBS Securities LLC for advisory services, (iii) pay $2,742,875 to redeem
125,000 common units representing limited partner interests in the Partnership
from K-Sea LLC, and (iv) make a capital contribution to the Operating
Partnership of the Offering Proceeds remaining after the payment of the
discounts and expenses and other amounts described in clauses (i) - (iii) of
this Section 3.6 (the "NET OFFERING PROCEEDS") as described in Section 3.9.

         Section 3.7 MERGER INTO OPERATING PARTNERSHIP. Pursuant to the
agreement and plan of merger attached hereto as EXHIBIT 3.7, LP2, GP2, LP4, GP4,
LP5 and GP5 shall merge with and into the Operating Partnership, with the
Operating Partnership being the surviving entity. As a result and pursuant to
the terms of such merger, the Conveyed Assets and the Conveyed Liabilities shall
be the assets and liabilities of the Operating Partnership.

         Section 3.8 DISTRIBUTION OF GENERAL PARTNER INTERESTS. New KST LLC
hereby distributes, grants, transfers, assigns and conveys to K-Sea Investors
and the K-Sea Members, as members of New KST LLC, an undivided interest in all
of the limited liability company interests in General Partner GP and 99.99% of
the limited partner interests in the General Partner owned by New KST LLC, in
each case in such relative proportions as correspond to such members' percentage
membership interests in New KST LLC as set forth in Schedule A to the First
Amended and Restated Limited Liability Company Agreement of General Partner GP
dated as of January 14, 2004 and in Schedule A to the First Amended and Restated
Agreement of Limited Partnership of the General Partner dated as of January 14,
2004, respectively.

         Section 3.9 CONTRIBUTION TO OPERATING PARTNERSHIP. The parties to this
Agreement acknowledge the contribution by the Partnership to the Operating
Partnership and the receipt by the Operating Partnership of the Net Offering
Proceeds, such contribution being made by the Partnership 99.99% on its own
behalf as limited partner in the Operating Partnership and .01% on behalf of OLP
GP as general partner in the Operating Partnership.

         Section 3.10 OPERATING PARTNERSHIP USE OF PROCEEDS. The parties to this
Agreement acknowledge that the Operating Partnership will use the Net Offering
Proceeds contributed to it as set forth in Section 3.9 as follows: (i) repayment
of $50,369,075.73 in respect of the Term

                                       13
<Page>

Loans, including $8.3 million in prepayment fees; (ii) payment of $4,556,434.00
in respect of the Maritrans Note; (iii) payment of $19,092,235.24 in respect of
debt and other obligations outstanding under the K-Sea Group's current revolving
credit agreement; and (iv) other general partnership purposes.

         Section 3.11 K-SEA TRANSPORTATION INC. The Operating Partnership shall
enter into bareboat charters, substantially in the form attached hereto as
EXHIBIT 3.11, with K-Sea Transportation Inc. with respect to the vessels set
forth on SCHEDULE 1.1(d) hereto.

                                   ARTICLE IV
                             ADDITIONAL TRANSACTIONS

         Section 4.1 EXERCISE OF THE OVER-ALLOTMENT OPTION. The parties to this
Agreement acknowledge that in the event the underwriters in the Offering
exercise their over-allotment option, the Partnership shall use any net proceeds
therefrom to redeem common units representing limited partner interests in the
Partnership then held by New KST LLC.

                                    ARTICLE V
                                  TITLE MATTERS

         Section 5.1  ENCUMBRANCES.

                 (a)      Except to the extent provided in Article III or any
other document executed in connection with this Agreement or the Offering,
including, without limitation, the Omnibus Agreement, the contribution and
conveyance (by operation of law or otherwise) of the Conveyed Assets are made
expressly subject to all recorded encumbrances, agreements, defects,
restrictions, and adverse claims covering the respective Conveyed Assets and all
laws, rules, regulations, ordinances, judgments and orders of Governmental
Authorities having or asserting jurisdiction over the Conveyed Assets and
operations conducted thereon or therewith, in each case to the extent the same
are valid and enforceable and affect the Conveyed Assets, including, without
limitation, (i) all matters that a current on the ground survey, title insurance
commitment or policy, or visual inspection of the Conveyed Assets would reflect,
(ii) the applicable liabilities assumed in Article III, and (iii) all matters
contained in the applicable provisions of Article III.

                 (b)      To the extent that certain jurisdictions in which the
Conveyed Assets are located may require that the documents be recorded in order
to evidence the transfers of title reflected in this Agreement, then the
provisions set forth in Section 5.1(a) immediately above shall also be
applicable to the conveyances under such documents.

         Section 5.2  DISCLAIMER OF WARRANTIES; SUBROGATION; WAIVER OF BULK
SALES LAWS.

                 (a)      EXCEPT TO THE EXTENT PROVIDED IN ANY OTHER DOCUMENT
EXECUTED OR DELIVERED IN CONNECTION WITH THIS AGREEMENT OR THE OFFERING
INCLUDING, WITHOUT LIMITATION, THE OMNIBUS AGREEMENT, THE PARTIES TO THIS
AGREEMENT ACKNOWLEDGE AND AGREE THAT NONE OF THE PARTIES TO THIS AGREEMENT HAS
MADE, DOES NOT MAKE, AND EACH SUCH PARTY SPECIFICALLY NEGATES AND DISCLAIMS, ANY
REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR

                                       14
<Page>

GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER EXPRESS, IMPLIED OR
STATUTORY, ORAL OR WRITTEN, PAST OR PRESENT, REGARDING (A) THE VALUE, NATURE,
QUALITY OR CONDITION OF THE CONVEYED ASSETS INCLUDING, WITHOUT LIMITATION, THE
WATER, SOIL, GEOLOGY OR ENVIRONMENTAL CONDITION OF THE CONVEYED ASSETS
GENERALLY, INCLUDING THE PRESENCE OR LACK OF HAZARDOUS SUBSTANCES OR OTHER
MATTERS ON THE CONVEYED ASSETS, (B) THE INCOME TO BE DERIVED FROM THE CONVEYED
ASSETS, (C) THE SUITABILITY OF THE CONVEYED ASSETS FOR ANY AND ALL ACTIVITIES
AND USES THAT MAY BE CONDUCTED THEREON, (D) THE COMPLIANCE OF OR BY THE CONVEYED
ASSETS OR THEIR OPERATION WITH ANY LAWS (INCLUDING WITHOUT LIMITATION ANY
ZONING, ENVIRONMENTAL PROTECTION, POLLUTION OR LAND USE LAWS, RULES,
REGULATIONS, ORDERS OR REQUIREMENTS), OR (E) THE HABITABILITY, MERCHANTABILITY,
MARKETABILITY, PROFITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE CONVEYED
ASSETS. EXCEPT TO THE EXTENT PROVIDED IN ANY OTHER DOCUMENT EXECUTED OR
DELIVERED IN CONNECTION WITH THIS AGREEMENT OR THE OFFERING INCLUDING, WITHOUT
LIMITATION, THE OMNIBUS AGREEMENT, THE PARTIES TO THIS AGREEMENT ACKNOWLEDGE AND
AGREE THAT EACH HAS HAD THE OPPORTUNITY TO INSPECT THE RESPECTIVE CONVEYED
ASSETS, AND EACH IS RELYING SOLELY ON ITS OWN INVESTIGATION OF THE RESPECTIVE
CONVEYED ASSETS AND NOT ON ANY INFORMATION PROVIDED OR TO BE PROVIDED BY ANY OF
THE PARTIES TO THIS AGREEMENT. EXCEPT TO THE EXTENT PROVIDED IN ANY OTHER
DOCUMENT EXECUTED OR DELIVERED IN CONNECTION WITH THIS AGREEMENT OR THE OFFERING
INCLUDING, WITHOUT LIMITATION, THE OMNIBUS AGREEMENT, NONE OF THE PARTIES TO
THIS AGREEMENT IS LIABLE OR BOUND IN ANY MANNER BY ANY VERBAL OR WRITTEN
STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE CONVEYED ASSETS
FURNISHED BY ANY AGENT, EMPLOYEE, SERVANT OR THIRD PARTY. EXCEPT TO THE EXTENT
PROVIDED IN ANY OTHER DOCUMENT EXECUTED OR DELIVERED IN CONNECTION WITH THIS
AGREEMENT OR THE OFFERING INCLUDING, WITHOUT LIMITATION, THE OMNIBUS AGREEMENT,
EACH OF THE PARTIES TO THIS AGREEMENT ACKNOWLEDGE THAT TO THE MAXIMUM EXTENT
PERMITTED BY LAW, THE CONTRIBUTION OF THE CONVEYED ASSETS AS PROVIDED FOR HEREIN
IS MADE IN AN "AS IS", "WHERE IS" CONDITION WITH ALL FAULTS, AND THE CONVEYED
ASSETS ARE CONTRIBUTED AND CONVEYED SUBJECT TO ALL OF THE MATTERS CONTAINED IN
THIS SECTION. THIS SECTION SHALL SURVIVE SUCH CONTRIBUTION AND CONVEYANCE OR THE
TERMINATION OF THIS AGREEMENT. THE PROVISIONS OF THIS SECTION HAVE BEEN
NEGOTIATED BY THE PARTIES TO THIS AGREEMENT AFTER DUE CONSIDERATION AND ARE
INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY REPRESENTATIONS OR
WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY, WITH RESPECT TO THE CONVEYED
ASSETS THAT MAY ARISE PURSUANT TO ANY LAW NOW OR HEREAFTER IN EFFECT, OR
OTHERWISE, EXCEPT AS SET FORTH IN THIS AGREEMENT OR ANY OTHER DOCUMENT EXECUTED
OR DELIVERED IN

                                       15
<Page>

CONNECTION WITH THIS AGREEMENT OR THE OFFERING, INCLUDING, WITHOUT LIMITATION,
THE OMNIBUS AGREEMENT.

                 (b)      To the extent that certain jurisdictions in which the
Conveyed Assets are located may require that documents be recorded in order to
evidence the transfers of title reflected in this Agreement, then the
disclaimers set forth in Section 5.2(a) immediately above shall also be
applicable to the conveyances under such documents.

                 (c)      The contributions of the Conveyed Assets made under
this Agreement are made with full rights of substitution and subrogation of the
respective parties receiving such contributions, and all Persons claiming by,
through and under such parties, to the extent assignable, in and to all
covenants and warranties by the predecessors-in-title of the parties
contributing the Conveyed Assets, and with full subrogation of all rights
accruing under applicable statutes of limitation and all rights of action of
warranty against all former owners of the Conveyed Assets.

                 (d)      Each of the parties to this Agreement agrees that the
disclaimers contained in this Section 5.2 are "conspicuous" disclaimers. Any
covenants implied by statute or law by the use of the words "grant," "convey,"
"bargain," "sell," "assign," "transfer," "deliver," or "set over" or any of them
or any other words used in this Agreement or any exhibits hereto are hereby
expressly disclaimed, waived or negated.

                 (e)      Each of the parties to this Agreement hereby waives
compliance with any applicable bulk sales law or any similar law in any
applicable jurisdiction in respect of the transactions contemplated by this
Agreement.

                                   ARTICLE VI
                               FURTHER ASSURANCES

         Section 6.1  FURTHER ASSURANCES. From time to time after the Closing
Date, and without any further consideration, the parties to this Agreement agree
to execute, acknowledge and deliver all such additional plans, agreements,
articles or certificates of merger, deeds, assignments, bills of sale,
conveyances, instruments, notices, releases, acquittances and other documents,
and will do all such other acts and things, all in accordance with applicable
law, as may be necessary or appropriate (i) more fully to assure that the
applicable parties to this Agreement and entities to be formed or incorporated
pursuant to the terms of this Agreement own all of the properties, rights,
titles, interests, estates, remedies, powers and privileges granted by this
Agreement, or which are intended to be so granted, (ii) more fully and
effectively to vest in the applicable parties to this Agreement and their
respective successors and assigns beneficial and record title to the interests
contributed and assigned by this Agreement or intended so to be and (iii) more
fully and effectively to carry out the purposes and intent of this Agreement.
The parties to this Agreement acknowledge that certain of the parties to this
Agreement and certain other parties (including entities in formation) and the
Secretary have executed the Reverter Agreement providing that the parties to the
Reverter Agreement take certain specified actions if the mergers described in
Sections 3.1 - 3.3 and 3.7 are not consummated or effected within the time
period specified in the Reverter Agreement.

                                       16
<Page>

         Section 6.2  POWER OF ATTORNEY. Each party that has conveyed the
Conveyed Assets as reflected by this Agreement (collectively, the "CONVEYING
PARTIES") hereby constitutes and appoints the General Partner (the
"ATTORNEY-IN-FACT"), its true and lawful attorney-in-fact with full power of
substitution for it and in its name, place and stead or otherwise on behalf of
the applicable Conveying Party and its successors and assigns, and for the
benefit of the Attorney-in-Fact to demand and receive from time to time the
Conveyed Assets contributed and to execute in the name of the applicable
Conveying Party and its successors and assigns instruments of conveyance,
instruments of further assurance and to give receipts and releases in respect of
the same, and from time to time to institute and prosecute in the name of the
applicable Conveying Party for the benefit of the Attorney-in-Fact, any and all
proceedings at law, in equity or otherwise which the Attorney-in-Fact may deem
proper in order to (i) collect, assert or enforce any claims, rights or titles
of any kind in and to the Conveyed Assets, (ii) defend and compromise any and
all actions, suits or proceedings in respect of any of the Conveyed Assets, and
(iii) do any and all such acts and things in furtherance of this Agreement as
the Attorney-in-Fact shall deem advisable. Each Conveying Party hereby declares
that the appointment hereby made and the powers hereby granted are coupled with
an interest and are and shall be irrevocable and perpetual and shall not be
terminated by any act of any Conveying Party or its successors or assigns or by
operation of law.

         Section 6.3  ACCESS TO BOOKS AND RECORDS. Each of EWH, K-Sea Corp and
KST LLC agrees (i) to give the Operating Partnership and OLP GP, as general
partner of the Operating Partnership, access during regular business hours to
its respective minute books, tax returns, stock records and other corporate or
limited liability company documents that it retained as Retained Assets upon
reasonable prior notice, and (ii) to allow the Operating Partnership and OLP GP
to make copies of any such documents.

                                   ARTICLE VII
                                  MISCELLANEOUS

         Section 7.1  ORDER OF COMPLETION OF TRANSACTIONS. The transactions
provided for in Article III shall be completed on the Closing Date in the order
set forth therein, followed by the transaction provided for in Article IV.

         Section 7.2  CONSENTS. If there are prohibitions against or conditions
to the contribution and conveyance of one or more of the Conveyed Assets without
the prior written consent of third parties, including, without limitation,
Governmental Authorities (other than consents of a ministerial nature which are
normally granted in the ordinary course of business), which if not satisfied
would result in a material breach of such prohibitions or conditions or would
give an outside party the right to terminate rights of the party to whom the
applicable assets were intended to be conveyed (the "BENEFICIAL OWNER") with
respect to such portion of the Conveyed Assets (herein called a "RESTRICTION"),
then any provision contained in this Agreement to the contrary notwithstanding,
the transfer of title to or interest in each such portion of the Conveyed Assets
(herein called the "RESTRICTION ASSET") pursuant to this Agreement shall not
become effective unless and until such Restriction is satisfied, waived or no
longer applies. When and if such a Restriction is so satisfied, waived or no
longer applies, to the extent permitted by applicable law and any applicable
contractual provisions, the assignment of the Restriction Asset subject thereto
shall become effective automatically as of the Closing Date, without further

                                       17
<Page>

action on the part of any party to this Agreement. Each of the applicable
parties to this Agreement that were involved with the conveyance of a
Restriction Asset agree to use their reasonable best efforts to obtain on a
timely basis satisfaction of any Restriction applicable to any Restriction Asset
conveyed by or acquired by any of them. The description of any portion of the
Conveyed Assets as a "Restriction Asset" shall not be construed as an admission
that any Restriction exists with respect to the transfer of such portion of the
Conveyed Assets. In the event that any Restriction Asset exists, the applicable
party agrees to continue to hold such Restriction Asset in trust for the
exclusive benefit of the applicable party to whom such Restriction Asset was
intended to be conveyed and to otherwise use its reasonable best efforts to
provide such other party with the benefits thereof, and the party holding such
Restriction Asset will enter into other agreements, or take such other action as
it may deem necessary, in order to ensure that the applicable party to whom such
Restriction Asset was intended to be conveyed has the assets and concomitant
rights necessary to enable the applicable party to operate such Restriction
Asset in all material respects as it was operated prior to the Closing Date.

         Section 7.3  COSTS. The Partnership shall pay all sales, use and
similar taxes arising out of the contributions, conveyances and deliveries to be
made hereunder, and shall pay all documentary, filing, recording, transfer,
deed, and conveyance taxes and fees required in connection therewith. In
addition, the Partnership shall be responsible for all costs, liabilities and
expenses (including court costs and reasonable attorneys' fees) incurred in
connection with the satisfaction or waiver of any Restriction pursuant to
Section 7.2.

         Section 7.4  GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement
shall be governed by and construed in accordance with the laws of the State of
Delaware applicable to contracts made and to be performed wholly within such
state without giving effect to conflict of law principles thereof, except to the
extent that it is mandatory that the law of some other jurisdiction shall apply.
Each party hereto hereby submits to the jurisdiction of the state and federal
courts in the State of New York and to venue in New York, New York.

         Section 7.5  ENTIRE AGREEMENT; SUPERSEDURE. This Agreement, together
with the exhibits to this Agreement as executed, delivered and filed, as
applicable, constitutes the entire agreement of the parties relating to the
matters contained herein, superseding all prior contracts or agreements, whether
oral or written, relating to the matters contained herein.

         Section 7.6  AMENDMENT OR MODIFICATION. This Agreement may be amended
or modified from time to time only by the written agreement of all the parties
hereto.

         Section 7.7  SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties signatory hereto and their
respective successors and assigns.

         Section 7.8  NO THIRD PARTY RIGHTS. The provisions of this Agreement
are intended to bind the parties signatory hereto as to each other and are not
intended to and do not create rights in any other Person or confer upon any
other Person any benefits, rights or remedies and no Person is or is intended to
be a third party beneficiary of any of the provisions of this Agreement.

                                       18
<Page>

         Section 7.9  COUNTERPARTS. This Agreement may be executed in any number
of counterparts with the same effect as if all signatory parties had signed the
same document. All counterparts shall be construed together and shall constitute
one and the same instrument.

         Section 7.10 SEVERABILITY. If any provision of this Agreement or the
application thereof to any Person or circumstance shall be held invalid or
unenforceable to any extent, the remainder of this agreement and the application
of such provision to other Persons or circumstances shall not be affected
thereby and shall be enforced to the greatest extent permitted by law.

         Section 7.11 GENDER, PARTS, ARTICLES AND SECTIONS. Whenever the context
requires, the gender of all words used in this Agreement shall include the
masculine, feminine and neuter, and the number of all words shall include the
singular and plural. All references to Article numbers and Section numbers refer
to Articles and Sections of this Agreement, unless the context otherwise
requires.

                                       19
<Page>

               IN WITNESS WHEREOF, the parties have executed this Agreement on,
and effective as of, the date first set forth above.

                               K-SEA INVESTORS L.P.

                               By: PARK AVENUE TRANSPORTATION, INC.,
                               its general partner


                               By:    /s/ BRIAN P. FRIEDMAN
                                     ----------------------------------------
                                     Brian P. Friedman
                                     President


                               K-SEA TRANSPORTATION LLC


                               By:    /s/ TIMOTHY J. CASEY
                                     ----------------------------------------
                                     Timothy J. Casey
                                     President


                               EW HOLDING CORP.


                               By:    /s/ TIMOTHY J. CASEY
                                     ----------------------------------------
                                     Timothy J. Casey
                                     President


                               K-SEA TRANSPORTATION CORP.


                               By:    /s/ TIMOTHY J. CASEY
                                     ----------------------------------------
                                     Timothy J. Casey
                                     President

<Page>

                               K-SEA TRANSPORTATION PARTNERS L.P.

                               By:   K-SEA GENERAL PARTNER L.P.,
                                     its general partner


                                     By: K-SEA GENERAL PARTNER GP LLC,
                                         its general partner


                                         By:  /s/ TIMOTHY J. CASEY
                                             ---------------------------------
                                             Timothy J. Casey
                                             President

                               K-SEA OPERATING PARTNERSHIP L.P.

                                     By: K-SEA OLP GP, LLC, its general partner


                                         By:  /s/ Timothy J. Casey
                                             ---------------------------------
                                             Timothy J. Casey
                                             President

<Page>

                                 SCHEDULE 1.1(a)
                                     VESSELS

                        K-SEA TRANSPORTATION LLC VESSELS

<Table>
<Caption>
              VESSEL NAME                              VESSEL TYPE
              -----------                              -----------
<S>                                                      <C>
Yankee.................................                  Tugboat
DBL 151................................                   Barge
Viking.................................                  Tugboat
Taurus.................................                  Tugboat
Jet Trader.............................                   Tanker
DBL 3201...............................                   Barge
Oyster Bay.............................                   Barge
E-10...................................                   Barge
Essex..................................                   Barge
Wallabout Bay..........................                   Barge
Great Lakes............................                   Tanker
DBL 31.................................                   Barge
DBL 32.................................                   Barge
Baltic Sea.............................                  Tugboat
Volunteer..............................                  Tugboat
DBL 105................................                   Barge
KTC - 60...............................                   Barge
KTC - 81...............................                   Barge
KTC - 90...............................                   Barge
KTC - 96...............................                   Barge
KTC - 135..............................                   Barge
KTC - 155..............................                   Barge
KTC - 55...............................                   Barge
DBL 70.................................                   Barge
KTC - 71...............................                   Barge
Tasman Sea.............................                  Tugboat
Irish Sea..............................                  Tugboat
Beaufort Sea...........................                  Tugboat
Bering Sea.............................                  Tugboat
Adriatic Sea...........................                  Tugboat
Java Sea...............................                  Tugboat
Coral Sea..............................                  Tugboat
Kara Sea...............................                  Tugboat
DBL 81.................................                   Barge
DBL 82.................................                   Barge
Hull No. 422 (to be known as DBL 102)..                   Barge
</Table>

                                       S-1
<Page>

                            EW HOLDING CORP. VESSELS

<Table>
<Caption>
              VESSEL NAME                              VESSEL TYPE
              -----------                              -----------
<S>                                                      <C>
Rebel..................................                  Tugboat
DBL 152................................                   Barge
DBL 134 (Cape Cod).....................                   Barge
Reliable...............................                   Barge
Special T..............................                   Barge
Falcon.................................                  Tugboat
Houma..................................                  Tugboat
Maryland...............................                  Tugboat
Odin...................................                  Tugboat
Great Gull.............................                   Tanker
DBL 2202...............................                   Barge
Aqua (E-12)............................                   Barge
American 21............................                   Barge
Trader II..............................                   Barge
Newark Bay.............................                   Barge
Josiah Bartlett........................                   Barge
Lemon Creek............................                   Barge
Casablanca.............................                   Barge
Spring Creek...........................                   Barge
KTC 20 (HMM 100).......................                   Barge
DBL 101................................                   Barge
</Table>

                                       S-2
<Page>

                                 SCHEDULE 1.1(b)
                                DRY CARGO BARGES

<Table>
<Caption>
              VESSEL NAME                             VESSEL TYPE
              -----------                             -----------
<S>                                                      <C>
Reliable...............................                  Barge
Special T..............................                  Barge
</Table>

                                       S-3
<Page>

                                 SCHEDULE 1.1(c)
                                      NOTES

MEMBER NOTES

1.   The 6.00% Note due April 29, 2004 dated April 30, 1999 by Timothy Casey in
     favor of KST LLC for the principal sum of $75,000.

2.   The 6.50% Note due December 20, 2004 dated December 21, 1999 by Timothy
     Casey in favor of KST LLC for the principal sum of $64,000.

3.   The 3.75% Note due September 29, 2007 dated September 30, 2002 by Timothy
     Casey in favor of KST LLC for the principal sum of $35,000.

4.   The 6.00% Note due April 29, 2004 dated April 30, 1999 by Rick Falcinelli
     in favor of KST LLC for the principal sum of $15,000.

5.   The 6.50% Note due December 20, 2004 dated December 21, 1999 by Rick
     Falcinelli in favor of KST LLC for the principal sum of $13,000.

6.   The 3.75% Note due September 29, 2007 dated September 30, 2002 by Rick
     Falcinelli in favor of KST LLC for the principal sum of $17,500.

7.   The 6.00% Note due April 29, 2004 dated April 30, 1999 by Thomas Sullivan
     in favor of KST LLC for the principal sum of $15,000.

8.   The 6.50% Note due December 20, 2004 dated December 21, 1999 by Thomas
     Sullivan in favor of KST LLC for the principal sum of $13,000.

9.   The 3.75% Note due September 29, 2007 dated September 30, 2002 by Thomas
     Sullivan in favor of KST LLC for the principal sum of $17,500.

10.  The 6.35% Note due September 20, 2005 dated September 20, 2000 by John J.
     Nicola in favor of KST LLC for the principal sum of $28,000.

11.  The 3.75% Note due September 29, 2007 dated September 30, 2002 by John
     Nicola in favor of KST LLC for the principal sum of $17,500.

12.  The 6.62% Note due July 31, 2005 dated July 31, 2000 by Christopher T. Palo
     in favor of KST LLC for the principal sum of $7,000.

13.  The 3.75% Note due September 29, 2007 dated September 30, 2002 by Greg
     Haslinsky in favor of KST LLC for the principal sum of $20,250.

14.  The 3.75% Note due September 29, 2007 dated September 30, 2002 by Terry
     Gill in favor of KST LLC for the principal sum of $7,750.

15.  The 3.75% Note due September 29, 2007 dated September 30, 2002 by Carl
     Eklof, Jr. in favor of KST LLC for the principal sum of $3,500.

                                       S-4
<Page>

16.  The 3.75% Note due September 29, 2007 dated September 30, 2002 by Richard
     Pittner in favor of KST LLC for the principal sum of $3,500.

TERM LOANS

1.   Term Loan of $9,747,933 aggregate principal amount (as of December 31,
     2003) due March 22, 2005 payable to The CIT Group/Equipment Financing, Inc.

2.   Term Loan of $9,333,975 million aggregate principal amount (as of December
     31, 2003) due December 3, 2005 payable to TBU Financial, Inc.

3.   Term Loan of $2,885,600 million aggregate principal amount (as of December
     31, 2003) due December 27, 2006 payable to Fifth Third Bank.

4.   Term Loan of $4,729,495 million aggregate principal amount (as of December
     31, 2003) due April 30, 2007 payable to TBU Financial, Inc.

5.   Term Loan of $5,235,700 million aggregate principal amount (as of December
     31, 2003) due April 30, 2007 payable to The CIT Group/Equipment Financing,
     Inc.

6.   Term Loan of $4,160,949 million aggregate principal amount (as of December
     31, 2003) due April 30, 2007 payable to The CIT Group/Equipment Financing,
     Inc.

7.   Term Loan of $2,027,751 million aggregate principal amount (as of December
     31, 2003) due June 14, 2014 payable to The CIT Group/Equipment Financing,
     Inc.

8.   Term Loan of $2,096,500 million aggregate principal amount (as of December
     31, 2003) due December 6, 2014 payable to The CIT Group/Equipment
     Financing, Inc.

                                       S-5
<Page>

                                 SCHEDULE 1.1(d)
                           BAREBOAT CHARTERED VESSELS

VESSELS

American 21
Aqua
DBL 31
DBL 32
DBL 3201
Falcon
Houma
Kara Sea
KTC 20
Newark Bay
Odin
Spring Creek
Taurus
Trader II

                                       S-6
<Page>

                                 EXHIBIT 3.1(a)

                          AGREEMENT AND PLAN OF MERGER
                                     BETWEEN
                              K-SEA CORP AND CORP5

                                       E-1
<Page>

                                 EXHIBIT 3.1(b)

                          AGREEMENT AND PLAN OF MERGER
                                     BETWEEN
                                  CORP5 AND LP5

                                       E-1
<Page>

                                 EXHIBIT 3.1(c)

                          AGREEMENT AND PLAN OF MERGER
                                     BETWEEN
                             CORP5 AND NEW KST CORP

                                       E-1
<Page>

                                 EXHIBIT 3.2(a)

                          AGREEMENT AND PLAN OF MERGER
                                     BETWEEN
                                  EWH AND CORP4

                                       E-1
<Page>

                                 EXHIBIT 3.2(b)

                          AGREEMENT AND PLAN OF MERGER
                                     BETWEEN
                                  CORP4 AND LP4

                                       E-1
<Page>

                                 EXHIBIT 3.2(c)

                          AGREEMENT AND PLAN OF MERGER
                                     BETWEEN
                                CORP4 AND NEW EWH

                                       E-1
<Page>

                                 EXHIBIT 3.3(a)

                          AGREEMENT AND PLAN OF MERGER
                                     BETWEEN
                                 KST LLC AND LP1

                                       E-1
<Page>

                                 EXHIBIT 3.3(b)

                          AGREEMENT AND PLAN OF MERGER
                                     BETWEEN
                                   LP1 AND LP2

                                       E-1
<Page>

                                 EXHIBIT 3.3(c)

                          AGREEMENT AND PLAN OF MERGER
                                      AMONG
                            LP1, GP1 AND NEW KST LLC

                                       E-1
<Page>

                                   EXHIBIT 3.7

                          AGREEMENT AND PLAN OF MERGER
                                      AMONG
           LP2, GP2, LP4, GP4, LP5, GP5 AND THE OPERATING PARTNERSHIP

                                       E-1
<Page>

                                  EXHIBIT 3.11

                            FORM OF BAREBOAT CHARTER
                                     BETWEEN
                            THE OPERATING PARTNERSHIP
                                       AND
                            K-SEA TRANSPORTATION INC.

                                       E-1