nor promises or inducements for
future transactions between or among any of such parties.
Section 4.05
Unregistered Securities.
(A)
INVESTMENT.
THE PURCHASED UNITS ARE BEING
ACQUIRED FOR ITS OWN ACCOUNT, NOT AS A NOMINEE OR AGENT, AND WITH NO INTENTION
OF DISTRIBUTING THE PURCHASED UNITS OR ANY PART THEREOF, AND THAT PURCHASER HAS
NO PRESENT INTENTION OF SELLING OR GRANTING ANY PARTICIPATION IN OR OTHERWISE
DISTRIBUTING THE SAME IN ANY TRANSACTION IN VIOLATION OF THE SECURITIES LAWS OF
THE UNITED STATES OF AMERICA OR ANY STATE, WITHOUT PREJUDICE, HOWEVER, TO
PURCHASER'S RIGHT AT ALL TIMES TO SELL OR OTHERWISE DISPOSE OF ALL OR ANY PART
OF THE PURCHASED UNITS UNDER A REGISTRATION STATEMENT UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS OR UNDER AN EXEMPTION FROM SUCH
REGISTRATION AVAILABLE THEREUNDER (INCLUDING, WITHOUT LIMITATION, IF AVAILABLE,
RULE 144 PROMULGATED THEREUNDER).
IF PURCHASER SHOULD IN THE FUTURE DECIDE TO
DISPOSE OF ANY OF THE PURCHASED UNITS, PURCHASER UNDERSTANDS AND AGREES (A) THAT
IT MAY DO SO ONLY (I) IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE
SECURITIES LAW, AS THEN IN EFFECT, OR (II) IN THE MANNER CONTEMPLATED BY ANY
REGISTRATION STATEMENT PURSUANT TO WHICH SUCH SECURITIES ARE BEING OFFERED, AND
(B) THAT STOP-TRANSFER INSTRUCTIONS TO THAT EFFECT WILL BE IN EFFECT WITH
RESPECT TO SUCH SECURITIES.
(B)
NATURE OF PURCHASER.
PURCHASER REPRESENTS
AND WARRANTS TO, AND COVENANTS AND AGREES WITH, K-SEA THAT, (A) IT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501 OF REGULATION D PROMULGATED
BY THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO THE SECURITIES ACT AND
(B) BY REASON OF ITS BUSINESS AND FINANCIAL EXPERIENCE IT HAS SUCH KNOWLEDGE,
SOPHISTICATION AND EXPERIENCE IN MAKING SIMILAR INVESTMENTS AND IN BUSINESS AND
FINANCIAL MATTERS GENERALLY SO AS TO BE CAPABLE OF EVALUATING THE MERITS AND
RISKS OF THE PROSPECTIVE INVESTMENT IN THE PURCHASED UNITS, IS ABLE TO BEAR THE
ECONOMIC RISK OF SUCH INVESTMENT AND, AT THE PRESENT TIME, WOULD BE ABLE TO
AFFORD A COMPLETE LOSS OF SUCH INVESTMENT.
15
(C)
RECEIPT OF INFORMATION; AUTHORIZATION.
PURCHASER ACKNOWLEDGES THAT IT HAS (A) HAD ACCESS TO K-SEA'S PERIODIC FILINGS
WITH THE COMMISSION, INCLUDING K-SEA'S ANNUAL REPORT ON FORM 10-K, QUARTERLY
REPORTS ON FORM 10-Q, AND CURRENT REPORTS ON FORM 8-K, (B) RECEIVED CERTAIN
INFORMATION FROM K-SEA COVERED BY THE CONFIDENTIALITY AGREEMENT AND (C) BEEN
PROVIDED A REASONABLE OPPORTUNITY TO ASK QUESTIONS OF AND RECEIVE ANSWERS FROM
REPRESENTATIVES OF K-SEA REGARDING SUCH MATTERS.
(D)
RESTRICTED SECURITIES.
PURCHASER
UNDERSTANDS THAT THE PURCHASED UNITS IT IS PURCHASING ARE CHARACTERIZED AS
"RESTRICTED SECURITIES" UNDER THE FEDERAL SECURITIES LAWS INASMUCH AS THEY ARE
BEING ACQUIRED FROM K-SEA IN A TRANSACTION NOT INVOLVING A PUBLIC OFFERING AND
THAT UNDER SUCH LAWS AND APPLICABLE REGULATIONS SUCH SECURITIES MAY BE RESOLD
WITHOUT REGISTRATION UNDER THE SECURITIES ACT ONLY IN CERTAIN LIMITED
CIRCUMSTANCES.
IN THIS CONNECTION, PURCHASER REPRESENTS THAT IT IS
KNOWLEDGEABLE WITH RESPECT TO RULE 144 OF THE COMMISSION PROMULGATED UNDER THE
SECURITIES ACT.
(E)
LEGEND.
IT IS UNDERSTOOD THAT THE
CERTIFICATES EVIDENCING THE PURCHASED