Document:

Exhibit 10.2

 

AMENDMENT NO. 1

TO

LOAN AND SECURITY AGREEMENT

 

AMENDMENT
NO. 1 (this “Amendment”),
dated as of October 18, 2005, by and among K-SEA
OPERATING PARTNERSHIP L.P. (the “Borrower”),
the several financial institutions party hereto (the “Lenders”),
KEYBANK NATIONAL ASSOCIATION, as
Administrative Agent for the Lenders (in such capacity, the “Administrative Agent”) and as
collateral trustee for the Lenders, and LASALLE BANK, NATIONAL
ASSOCIATION, as syndication agent.

 

RECITALS

 

A.                                   The Borrower, the Lenders and the Administrative
Agent are parties to a Loan and Security Agreement, dated as of March 24,
2005 (as it may be amended, restated, supplemented or otherwise modified from
time to time, the “Loan Agreement”).  Unless otherwise defined herein, all
capitalized terms used herein or in the Acknowledgement and Consent annexed
hereto shall have the meanings ascribed to them in the Loan Agreement.

 

B.                                     The Borrower and K-Sea are parties to the Membership
Interest Purchase Agreement, dated August 23, 2005 (the “Sea Coast Purchase Agreement”), among
the Borrower, K-Sea, Marine Resources Group, Inc. (“Sea Coast
Seller”) and Saltchuk Resources, Inc., pursuant to which
the Borrower has agreed to purchase all of the membership interests in Sea
Coast Transportation LLC, a Delaware limited liability company and the
successor-by-merger to Sea Coast Towing, Inc., a Washington corporation
and a wholly-owned subsidiary of Sea Coast Seller, on the terms and conditions
set forth in the Sea Coast Purchase Agreement, for an aggregate purchase price of
$77,000,000 in cash and 125,000 common units of K-Sea, as such purchase price
may be adjusted pursuant to the terms of the Sea Coast Purchase Agreement (the “Purchase Price”).  Such acquisition is referred to herein as the
“Sea Coast Acquisition”.

 

C.                                     The Borrower has advised the Administrative Agent
and the Lenders that it desires to amend the Loan Agreement in certain respects,
to, among other things, increase the aggregate Commitments of the Lenders.

 

D.                                    Each of the Lenders desires to increase its
respective Commitment in accordance with the terms hereof and the Borrower
desires to accept such increased Commitments.

 

E.                                      Simultaneously with the execution and delivery of
this Amendment, Wachovia Bank, National Association (the “New
Lender”) has agreed to make loans to the Borrower and the
Borrower desires to accept the Commitment of the New Lender and to cause the
New Lender to be added as a “Lender” to the Loan Agreement as amended hereby,
and the Administrative Agent and the Lenders are agreeable to the addition of
the New Lender.

 

 

F.                                      The Administrative Agent has advised the Borrower
that the Lenders are willing to agree to its requests to amend the Loan
Agreement on the terms and subject to the conditions set forth in this Amendment.

 

Accordingly, in consideration of the foregoing, the
parties hereto hereby agree as follows:

 

1.                                       CHANGE IN COMMITMENTS; ADDITIONAL LENDER.

 

(a)                                  Commitments.  From and after the Amendment No. 1
Effective Date, the Commitment of each Lender shall be the amount set forth
opposite such Lender’s name on Schedule 2.01 to the Loan Agreement (as
amended hereby and attached hereto as Exhibit E) under the caption “Commitment”
as such amount may be increased or reduced pursuant to the terms of the Loan
Agreement, and such amount (if changed) shall supersede and be deemed to amend
the amount of such Lender’s Commitment as set forth on Schedule 2.01 to
the Loan Agreement as in effect on the Effective Date.

 

(b)                                 New Lender.  The New Lender agrees with the Borrower, the
other Lenders and the Administrative Agent that (i) it will abide by the
terms of the Loan Agreement as amended hereby as a “Lender” thereunder, and (ii) the
Loan Agreement as amended hereby shall be binding upon, inure to the benefit
of, and be enforceable by and against it. 
The Borrower hereby consents to the New Lender being added as a “Lender”
under the Loan Agreement, as amended hereby, effective as of the Amendment No. 1
Effective Date.

 

(c)                                  Adjustment of Outstanding Loans.  If any Loans are outstanding under the Loan
Agreement on the Amendment No. 1 Effective Date, the Lenders shall on the
Amendment No. 1 Effective Date, at the direction of the Administrative
Agent, make appropriate adjustments among themselves in order to insure that
the amount (and type) of the Loans outstanding to the Borrower from each Lender
under the Loan Agreement (as of the Amendment No. 1 Effective Date) are
proportionate to the aggregate amount of all of the Commitments, after giving
effect to the increase in the Maximum Amount and increase in the amount of the
Commitments of each of the Lenders and to the additional Commitment of the New Lender.  Borrower agrees and consents to the terms of
this Section 1(c).

 

2.                                       AMENDMENTS TO LOAN AGREEMENT.

 

(a)                                  Additional Definitions.  Section 1.01 of the Loan Agreement is
hereby amended by adding the following new definitions in the appropriate
alphabetical order:

 

“Additional Pool Vessels”
means those vessels owned by Borrower identified on Exhibit B
to Amendment No. 1.

 

“Amendment No. 1”
means Amendment No. 1 to Loan Agreement, dated as of October 18,
2005, among Borrower, the Lenders party thereto and the Administrative Agent.

 

“Amendment No. 1
Effective Date” means October 18, 2005.

 

2

 

“Excluded Subsidiaries”
means, collectively, Inversiones Kara Sea Srl., K-Sea Canada Holdings and K-Sea
Canada Corp.

 

“Sea Coast Acquisition”
has the meaning ascribed thereto in Amendment No. 1.

 

“Sea Coast Acquisition
Documents” means the Sea Coast Purchase Agreement and the
instruments, agreements and documents executed and delivered in connection
therewith.

 

“Sea Coast Acquisition
Transactions” means, collectively, (i) the issuance by
K-Sea of  common units and the receipt by
K-Sea of not less than $33,000,000 in proceeds therefrom, (ii) the merger
of Sea Coast Towing with and into Sea Coast LLC, with Sea Coast LLC as the
surviving Person of such merger, (iii) the purchase by Borrower of one
hundred percent (100%) of the membership interest in Sea Coast LLC and (iv) the
distribution by Sea Coast Towing of the vessels described in the Vessel
Purchase Agreement dated October 18, 2005 between Sea Coast LLC and Sea
Coast Seller to Sea Coast Seller and the subsequent sale of such vessels to Sea
Coast LLC by Sea Coast Seller pursuant to the Vessel Purchase Agreement dated October 18,
2005 between Sea Coast LLC and Sea Coast Seller.

 

“Sea Coast LLC”
means Sea Coast Transportation LLC, a Delaware limited liability company and
successor-by-merger to Sea Coast Towing.

 

“Sea Coast Mortgage”
means the First Preferred Fleet Mortgage, dated the Amendment No. 1
Effective Date, granted by Sea Coast LLC to the Collateral Trustee over the
whole of the Sea Coast Pool Vessels, as the same may be amended, modified or supplemented
from time to time and from which Sea Coast Pool Vessels may be added or
released from time to time.

 

“Sea Coast Pool Vessels”
means those vessels owned by Sea Coast LLC identified on Exhibit C to
Amendment No. 1.

 

“Sea Coast Purchase
Agreement” means the Membership Interest Purchase Agreement,
dated August 23, 2005, among the Borrower, K-Sea, Sea Coast Seller and
Saltchuk Resources, Inc.

 

“Sea Coast Seller”
means Marine Resources Group, Inc., a Washington corporation.

 

“Sea Coast Towing”
means Sea Coast Towing, Inc., a Washington corporation and a wholly-owned
Subsidiary of Sea Coast Seller.

 

3

 

(b)                                 Amendments
to Definitions.

 

(i)                                     Applicable Margin.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of “Applicable Margin” in its entirety
and substituting the following therefor:

 

“Applicable Margin” means, at all
times during the applicable periods set forth below: (a) with respect to
Base Rate Loans, the percentage set forth below under the heading “Base Rate
Margin” and adjacent to such period, (b) with respect to LIBOR Loans, the
percentage set forth below under the heading “LIBOR Margin” and adjacent to
such period and (c) with respect to the Commitment Fees, the percentage
set forth below under the heading “Commitment Fee Margin” and adjacent to such
period:

 

	
  Period

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  When the Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Funded Debt to

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EBITDA Ratio

  	
   

  	
   

  	
   

  	
  Applicable Margin

  	
   

  
	
  is greater than

  or equal to

  	
   

  	
  And less

  than

  	
   

  	
  Base Rate

  Margin

  	
   

  	
  LIBOR

  Margin

  	
   

  	
  Commitment

  Fee Margin

  	
   

  
	
  3.50:1.00

  	
   

  	
   

  	
   

  	
  0.250

  	
  %

  	
  2.000

  	
  %

  	
  0.300

  	
  %

  
	
  3.00:1.00

  	
   

  	
  3.50:1.00

  	
   

  	
  0.000

  	
  %

  	
  1.750

  	
  %

  	
  0.200

  	
  %

  
	
  2.50:1.00

  	
   

  	
  3.00:1.00

  	
   

  	
  0.000

  	
  %

  	
  1.500

  	
  %

  	
  0.200

  	
  %

  
	
  2.00:1.00

  	
   

  	
  2.50:1.00

  	
   

  	
  0.000

  	
  %

  	
  1.250

  	
  %

  	
  0.150

  	
  %

  
	
   

  	
   

  	
  2.00:1.00

  	
   

  	
  0.000

  	
  %

  	
  1.000

  	
  %

  	
  0.150

  	
  %

  

 

Changes in the Applicable Margin resulting from a
change in the Total Funded Debt to EBITDA Ratio shall be based upon the
certificate most recently delivered under Section 6.01(b) and shall
become effective on the first day of the month immediately succeeding the date
such certificate is required to be delivered to the Administrative Agent
pursuant to Section 6.01(b). 
Notwithstanding anything to the contrary in this definition, (i) if
Borrower shall fail to deliver to the Administrative Agent such a certificate
on or prior to any date required by Section 6.01(b), the Total Funded Debt
to EBITDA Ratio shall be deemed to be greater than 3.50:1.00 from and including such date to the first day of the month
immediately succeeding the date of delivery to the Administrative Agent of such
certificate and (ii) during the period commencing on the Amendment No. 1
Effective Date and ending on the first day of the month immediately succeeding
the date that the certificate to be delivered under Section 6.01(b) for
the fiscal quarter ending December 31, 2005 is to be delivered to the
Administrative Agent, the Applicable Margin shall be 0.000% for Base Rate
Loans, 1.750% for LIBOR Loans and 0.200% with respect to the Commitment Fees.

 

4

 

(ii)                                  Assignment of Insurances. 
Section 1.01 of the Loan
Agreement is hereby amended by deleting the definition of “Assignment of Insurances” in its
entirety and substituting the following therefor:

 

“Assignment of Insurances” means
the first priority assignment of insurances respecting the Pool Vessels granted
by Borrower or any Subsidiary Guarantor in favor of the Collateral Trustee, in
form and substance satisfactory to Administrative Agent.

 

(iii)                               Collateral.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of “Collateral”
in its entirety and substituting the following therefor:

 

“Collateral”
means the collateral described in this Agreement, including, but not limited
to, in Article III hereof, the Assignments and the Mortgage, including,
without limitation, the Pool Vessels, and the Proceeds thereof, all insurance
with respect to the Pool Vessels, any and all charters of the Pool Vessels by
Borrower or any Subsidiary Guarantor and all Hire and other amounts payable
from time to time thereunder and the Proceeds thereof, all future charters of
the Pool Vessels by Borrower or any Subsidiary Guarantor, including all Hire
payments and Proceeds of the foregoing and all amounts payable hereunder as
more specifically described herein and in the Assignments and the Mortgage.

 

(iv)                              Credit Party.  Section 1.01
of the Loan Agreement is hereby amended by deleting the definition of “Credit Party” in its entirety and
substituting the following therefor:

 

“Credit Party”
means each of Borrower, each Guarantor and each of their respective
Subsidiaries; provided, however, “Credit Party” shall
exclude the Excluded Subsidiaries.

 

(v)                                 Earnings Assignment.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of “Earnings Assignment” in its
entirety and substituting the following therefor:

 

“Earnings
Assignment” means the general assignment for security interest
purposes of all charters, charter hire, freights and earnings with respect to
the Pool Vessels granted by Borrower or any Subsidiary Guarantor in favor of
the Collateral Trustee, in form and substance satisfactory to the
Administrative Agent.

 

(vi)                              Hire.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of “Hire” in its entirety and
substituting the following therefor:

 

“Hire”
means all charter hire under any and all charters entered into by or on behalf
of Borrower or any Subsidiary Guarantor of any Pool Vessel from time to time,
together with additional hire, supplemental hire, requisition hire, freights
and any other amounts paid to or for the account

 

5

 

of
Borrower or such Subsidiary Guarantor on account of the use or employment of
such Pool Vessel.

 

(vii)                           Loan Documents.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of “Loan Documents” in its entirety and
substituting the following therefor:

 

“Loan Documents”
means, collectively, this Agreement, Amendment No. 1, the Notes, the
Mortgage, the Sea Coast Mortgage, the Parent Guaranty, each Subsidiary
Guaranty, the Assignments and all consents given with respect to any of the
foregoing.

 

(viii)                        Maximum Amount.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of “Maximum Amount” in its entirety and
substituting the following therefor:

 

“Maximum Amount”
means, with respect to the Facility, One Hundred Twenty Million Dollars
($120,000,000.00), as such amount may be increased in the aggregate in
accordance with Section 2.18 hereof or decreased in the aggregate in
accordance with Section 2.07.

 

(ix)                                Mortgage.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of “Mortgage” in its entirety and
substituting the following therefor:

 

“Mortgage”
means, collectively, (i) the First Preferred Fleet Mortgage, dated March 24,
2005, originally granted by Borrower to the Collateral Trustee over the whole
of the Pool Vessels (other than the Additional Pool Vessels), as such Mortgage
is amended and supplemented on the Amendment No. 1 Effective Date and (ii) the
Sea Coast Mortgage, as each may be amended, modified or supplemented from time
to time and from which Pool Vessels may be added or released from time to time

 

(x)                                   Permitted Liens.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of 
“Permitted Liens”
in its entirety and substituting the following therefor:

 

“Permitted Liens” means:

 

(a)                                  Liens
imposed by law for taxes or under ERISA in respect of contingent liabilities thereunder
that are not yet due;

 

(b)                                 carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens
imposed by law, including, but not limited to, liens for current wages of the
crew of any Pool Vessel, including the master of such Pool Vessel, for current
wages of stevedores when employed directly by such Pool Vessel or for general
average or salvage, including contract salvage or liens arising in the ordinary
course of business and securing obligations that are not overdue by more than

 

6

 

thirty (30) days and in each such case such liens are
subordinate to the Lien of the Mortgage;

 

(c)                                  Liens
arising out of bareboat charters of Pool Vessels to K-Sea Transportation Inc.
covering the Pools Vessels described on Schedule 4.14; and

 

(d)                                 Liens
arising out of time charters, voyage charters or contracts of affreightment
with unrelated third parties in respect of a Pool Vessel;

 

provided,
that the term “Permitted Liens” shall not include any Lien securing
Indebtedness; and, provided, further, that the aggregate amount
of Permitted Liens outstanding on all Pool Vessels at any one time shall not
exceed $2,500,000.

 

(xi)                                Pool Vessels.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of 
“Pool Vessels”
in its entirety and substituting the following therefor:

 

“Pool Vessels”
means, collectively, (i) those vessels identified on Schedule 1.01
hereto as of the Effective Date, (ii) the Additional Pool Vessels and (iii) the
Sea Coast Pool Vessels, in each case together with any vessels hereafter added
to the Pool Vessels pursuant to Section 3.02 or Section 3.03 hereof.

 

(xii)                             Subsidiary Guarantor.  Section 1.01
of the Loan Agreement is hereby amended by deleting the definition of “Subsidiary Guarantor”
in its entirety and substituting the following therefor:

 

“Subsidiary
Guarantor” means any Subsidiary that executes and delivers a
Subsidiary Guaranty; provided, however, “Subsidiary Guarantor”
shall exclude the Excluded Subsidiaries.

 

(xiii)                          Termination Date.  Section 1.01 of the Loan Agreement is
hereby amended by deleting the definition of “Termination Date” in its entirety
and substituting the following therefor:

 

“Termination Date”
means October 18, 2010.

 

(xiv)                         Total Funded Debt to EBITDA Ratio.  Section 1.01
of the Loan Agreement is hereby amended by deleting the definition of “Total Funded Debt to
EBITDA Ratio” in its entirety and substituting the following
therefor:

 

“Total Funded Debt to
EBITDA Ratio” means, at any date of determination, the ratio of Total Funded Debt divided
by EBITDA for the four fiscal quarter period ending on such date or, if such
date is not the last day of a fiscal quarter, for the immediately preceding
four fiscal quarter period; provided, that, for any such determination,
EBITDA shall be adjusted to include, for the relevant four fiscal quarter
period, pro forma

 

7

 

EBITDA in an amount reasonably acceptable to
the Administrative Agent respecting
any vessel or business acquisition for which debt is incurred and included in
Total Funded Debt.

 

(c)                                  Evidence of Debt.  Section 2.08(e) of the Loan
Agreement is hereby deleted its entirety and the following substituted therefor:

 

(e)                                  The
Loans made by any Lender may, upon request of such Lender, be evidenced by a
Note in the form attached to Amendment No. 1 as Exhibit A.  In such
event, Borrower shall execute and deliver to such Lender a Note payable to the
order of such Lender (or, if requested by such Lender, to such Lender and its
registered assigns) substantially in the form as attached to Amendment No. 1
as Exhibit A and otherwise in form and substance acceptable such
Lender.  Thereafter, the Loans evidenced
by such Note and interest thereon shall at all times (including after
assignment pursuant to Section 10.07 hereof) be represented by one or more
Notes in such form payable to the order of the payee named therein.  Each such Lender may enter Loans and
repayment made on any Note; provided, however, that failure to do
so shall not affect Borrower’s obligations to repay all Loans made.

 

(d)                                 Payments Generally; Pro Rata Treatment; Sharing of
Set-offs.  Section 2.14
of the Loan Agreement is hereby amended by (i) deleting each reference in Section 2.14(b)(ii) to
“$50,000,000.00” and substituting therefor “$62,500,000.00” and (ii) deleting
Section 2.14(b)(v) in its entirety and substituting the following
therefor:

 

(v)                                 After
an Event of Default shall have occurred and be continuing and after Lenders
have either, (i) as assignee from Borrower or any Subsidiary Guarantor of
any charter of any of the Pool Vessels, declared such charter to be in default
or terminated in accordance with the terms thereof, or (ii) declared all
amounts outstanding hereunder to be due and payable pursuant to Section 8.02
hereof, or done both (i) and (ii), all payments received and amounts
realized by any Lender, as well as all payments or amounts then held by the
Lenders as part of the Collateral, shall be applied against the Obligations in
such order and such manner as the Lenders, in their sole discretion, may
determine and as otherwise provided in the other Loan Documents and the
documents evidencing the other Obligations, and the balance, if any, shall be
paid by the Lenders to Borrower.

 

(e)                                  Increase of Commitments.  Section 2.18(a) of the Loan
Agreement is hereby amended by deleting the first sentence thereof in its
entirety and substituting the following therefor:

 

Provided
that no Default or Event of Default has occurred and is continuing, Borrower
may, at any time and from time to time, provide a written request to the
Administrative Agent to increase the Commitments of the Facility by up to an
aggregate maximum amount of Fifty Million Dollars ($50,000,000.00).

 

8

 

(f)                                    Grant of Security Interest.

 

(i)                                     Section 3.01(a) of
the Loan Agreement is hereby deleted in its entirety and the following
substituted therefore:

 

(a)                                  To
secure the payment and performance in full of all Obligations, each of Borrower
and Sea Coast LLC hereby grants to the Collateral Trustee for the ratable
benefit of the Lenders a continuing security interest in and Lien upon, and a
right of set-off against, and each of Borrower and Sea Coast LLC hereby assigns
and pledges to the Collateral Trustee for the ratable benefit of the Lenders,
all of the Collateral owned by it or a Subsidiary Guarantor or in which such
party has an interest.

 

(ii)                                  Section 3.01(b) of
the Loan Agreement is hereby amended by deleting clause (i) thereof in its
entirety and substituting the following therefor:

 

(i)                                     each
of the Pool Vessels, together with all of its machinery, anchors, cables,
chains, rigging, tackle, fittings, tools, pumps, pumping equipment, gear,
apparel, furniture, appliances, equipment, spare and replacement parts and all
other appurtenances thereunto appertaining or belonging, whether now owned or
hereafter acquired by its respective owner and whether on board or not, and
also any and all additions, improvements and replacements made in or to such
Pool Vessels or any part thereof or in or to
any equipment and appurtenances thereunder appertaining or belonging and any
and all the charter hire, subcharter hire, freights, subfreights, earnings,
charters (including, without limitation, any rights of termination thereof), to
the extent set forth in the Earnings Assignment, insurance proceeds and all
other Proceeds paid or payable to Borrower or any Subsidiary Guarantor on
account of the use or employment of any Pool Vessel, being secured by the
Mortgage or any other mortgage to be executed and delivered by Borrower or any
Subsidiary Guarantor in favor of the Collateral Trustee or the Lenders (each, a
“Mortgage”); and

 

(g)                                 Substitution of Pool Vessels.  Section 3.02 of the Loan Agreement is hereby
amended by deleting each reference therein to “$50,000,000.00” and substituting
therefor “$62,500,000.00”.

 

(h)                                 Orderly Liquidation Value.  Section 3.03 of the Loan Agreement is
hereby amended by deleting each reference therein to “$50,000,000.00” and
substituting therefor “$62,500,000.00”.

 

(i)                                     Organization.  Section 4.13 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 4.01                            Organization.  Each of Borrower, K-Sea and each Subsidiary
Guarantor (other than Sea Coast LLC) is a limited partnership duly organized,
validly existing and in good standing under the laws of Delaware.  Sea Coast LLC is a limited liability company
duly organized, validly existing and in good standing under the laws of Delaware.  Each of Borrower, K-Sea and each Subsidiary
Guarantor has the necessary right,

 

9

 

power
and authority to own its respective assets and to transact the business in
which it is engaged, and is duly qualified to do business in each jurisdiction
where such qualification is legally required and in each jurisdiction where the
failure to qualify would affect the enforceability of the Loan Documents or
otherwise adversely affect the Collateral or Borrower’s or K-Sea’s or any
Subsidiary Guarantor’s ability to perform its respective obligations under any
of the Loan Documents.

 

(j)                                     Title.  Section 4.13 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 4.13                            Title.  Borrower and the Subsidiary Guarantors have
and at all times will defend and continue to have good and marketable title to
all of the Collateral, free and clear of all Liens, security interests, claims
or encumbrances of any kind whatsoever subject only to Permitted Liens.  The Pool Vessels (other than the Sea Coast
Pool Vessels) are documented in the name of Borrower with the United States
Coast Guard National Vessel Documentation Center in Falling Waters, West
Virginia and the Sea Coast Pool Vessels are documented in the name of Sea Coast
LLC with the United States Coast Guard National Vessel Documentation Center in
Falling Waters, West Virginia.

 

(k)                                  Lenders’ Security Interest.  Section 4.14 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 4.14                            Lenders’ Security Interest. 
As of the Amendment No. 1 Effective Date, the Collateral
Trustee shall have a legal, valid and continuing first preferred ship mortgage
(as amended, supplemented or otherwise modified from time to time) over the
whole of, and a perfected first lien on and security interest in, the Pool
Vessels, and the Administrative Agent shall have a perfected first lien on and
security interest in the remaining Collateral subject only to Permitted Liens
and all taxes, fees and other charges in connection therewith shall have been
duly paid.  There are no demise charters
in effect on any Pool Vessels other than the charters identified on Schedule 4.14.

 

(l)                                     Vessels.  Section 4.16(a) of the Loan
Agreement is hereby deleted in its entirety and the following substituted
therefor:

 

(a)                                  Set
forth on Schedule 1.01 (attached to Amendment No. 1 as Exhibit D)
is a complete and accurate list, as of the Amendment No. 1 Effective Date,
of all Pool Vessels, showing as of the Amendment No. 1 Effective Date with
respect to each such Pool Vessels the following:  (i) the name of each Pool Vessel and (ii) the
name of the Registered Owner of the Pool Vessels.

 

(m)                               Sea Coast Acquisition.  Article IV of the Loan Agreement is
hereby amended by adding a new Section 4.19 to read in its entirety as
follows:

 

Section 4.19                            The
Sea Coast Acquisition.  Borrower
has heretofore delivered to the Administrative Agent true, correct and

 

10

 

complete
copies of the Sea Coast Acquisition Documents. 
Borrower has, concurrently with the execution and delivery of Amendment No. 1,
consummated the Sea Coast Acquisition in all material respects pursuant to the
Sea Coast Acquisition Documents, and the Sea Coast Acquisition Documents set
forth the entire agreement among the parties thereto with respect to the
subject matter thereof.  No party to any
of the Sea Coast Acquisition Documents has waived the fulfillment of any
material condition precedent set forth therein to the consummation of the Sea
Coast Acquisition, no party has failed to perform any of its material
obligations thereunder or under any instrument or document executed and
delivered in connection therewith, and nothing has come to the attention of
Borrower that would cause it to believe that any of the representations or
warranties of Sea Coast Seller contained in the Sea Coast Acquisition Documents
was false or misleading in any material respect when made or when reaffirmed on
the Amendment No. 1 Effective Date. 
No consent or approval, authorization or declaration of any governmental
authority, bureau or agency, is or will be required in connection with the Sea
Coast Acquisition Transactions, except for consents that have been obtained
prior to the Amendment No. 1 Effective Date.  Neither the execution and delivery of the Sea
Coast Acquisition Documents, nor the performance of Borrower’s obligations
thereunder, will violate any provision of law or will conflict with or result
in a breach of, or create (with or without the giving of notice or lapse of
time, or both) a default under, any material agreement to which Borrower is a
party or by which it is bound or any of its assets is affected.  Borrower has acquired by virtue of the consummation
of the Sea Coast Acquisition Transactions and now has good and marketable title
to one hundred percent (100%) of the membership interest in Sea Coast LLC and
Sea Coast LLC has acquired by virtue of the consummation of Sea Coast
Acquisition Transactions and now has good and marketable title to all the
assets to which Sea Coast Towing had good and marketable title, free and clear
of any Lien, except (i) for Permitted Liens and (ii) for the Liens
created and granted by the Loan Documents.

 

(n)                                 Insurance.  Section 6.06 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 6.06                            Insurance.  (a) 
With respect to the Collateral and other assets, Borrower shall
maintain, and cause each Subsidiary Guarantor to maintain, insurance at all
times, with financially sound and reputable insurers that are reasonably
acceptable to the Administrative Agent. 
With respect to insurance on all Collateral, all such insurance policies
shall be in such form, substance, amounts and coverage as may be satisfactory
to the Administrative Agent, including, without limitation, insurance on hull
and machinery, protection and indemnity, loss or damage to vessels, damage to
property of third parties (including customers), loss or contamination of
cargo, personal injuries to employees or third parties, and pollution and other
related environmental damage.

 

(b)                                 Such
insurance shall provide for thirty (30) days’ prior written notice to the
Administrative Agent of any reduction or cancellation of coverage on account of
default in the payment of any premium and shall

 

11

 

provide
Lenders with the opportunity to cure nonpayment.  Borrower hereby irrevocably appoints the
Administrative Agent with full right of delegation by the Administrative Agent
as attorney-in-fact for Borrower to obtain, at Borrower’s expense, any such
insurance should Borrower or any Subsidiary Guarantor fail to do so and, after
an Event of Default, to adjust or settle any claim or other matter under or
arising pursuant to such insurance or to amend or cancel such insurance.  Borrower shall deliver to the Administrative
Agent evidence of such insurance and a lender’s loss payable endorsement
satisfactory to the Administrative Agent as to all existing and future
insurance policies with respect to the Collateral.  Borrower shall deliver to the Administrative
Agent, in kind, all instruments representing proceeds of insurance received by
Borrower or any Subsidiary Guarantor. 
Except as otherwise specifically provided herein or in the Mortgage as
to any Pool Vessel, the Administrative Agent may apply any insurance proceeds
received by the Administrative Agent or the Collateral Trustee at any time to
the cost of repairs to or replacement of any portion of the Collateral and/or,
at the Administrative Agent’s option, to payment of or as security for any of
the Obligations, whether or not due, in any order or manner as the
Administrative Agent may determine. 
Borrower will insure, and cause each Subsidiary Guarantor to insure,
each Pool Vessel in accordance with Section 1.18 of the Mortgage. Nothing
in this Agreement shall be construed to limit or restrict the provisions of Section 1.18
of the Mortgage, but shall be in addition thereto.

 

(o)                                 U.S Person.                                Section 6.11
of the Loan Agreement is hereby deleted in its entirety and the following
substituted therefor:

 

Section 6.11                            U.S.
Person.  Borrower and each
Subsidiary Guarantor shall at all times until the Lien of the Mortgage shall be
discharged and there are no Loans outstanding hereunder be a limited
partnership (or a limited liability company in the case of Sea Coast LLC)
organized under the laws of Delaware or another state within the United States.

 

(p)                                 Documentation.  Section 6.12 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 6.12                            Documentation. 
Borrower will, and will cause each Subsidiary Guarantor to,
comply with and satisfy all provisions of the laws and regulations of the United
States now or hereafter from time to time in effect in order that the Pool
Vessels shall continue to be documented vessels pursuant to the laws of the
United States as vessels of the United States under the United States flag with
such endorsements as shall qualify the Pool Vessels for participation in the
coastwise trade and such other trades and services to which they may be
dedicated from time to time.

 

(q)                                 Performance of Contracts.  Section 6.16 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

12

 

Section 6.16                            Performance of Contracts. 
Borrower will, and will cause each Subsidiary Guarantor to,
duly observe and perform in all material respects all covenants and obligations
to be performed by it under any charter or any other contract for use of the
Pool Vessels or any of them and will promptly take any and all action as may be
reasonably necessary to enforce its rights under any such charter or contract or
to secure the performance by such charterer or operator of such party’s
obligations under any such charter or contract. 
If an Event of Default shall have occurred and be continuing, Borrower
shall not, and shall not permit any Subsidiary Guarantor to, amend, terminate
or otherwise modify the terms of any such charter or contract without the prior
written consent of the Lenders, which shall not be unreasonably withheld or
delayed, but to which reasonable conditions may be attached; provided, however,
the Lenders shall have no obligation to consent to any termination or to any
amendment or modification, if in the Lenders’ judgment such amendment or
modification would materially increase the Lenders’ risks in the transaction,
reduce its returns or otherwise disadvantage the Lenders.

 

(r)                                    Subsidiary Guaranties.  Section 6.18 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 6.18                            Subsidiary
Guaranties.  Upon the formation
or acquisition of any Subsidiary of Borrower (other than an Excluded
Subsidiary), Borrower shall cause each such Subsidiary to provide a Subsidiary
Guaranty to the Administrative Agent substantially in the form attached hereto
as Exhibit H.  In the event any Subsidiary of Borrower is an
entity other than a corporation, the form of Subsidiary Guaranty shall be
modified to reflect the nature of such entity.

 

(s)                                  Relating to the Vessels.  Section 6.19(c) of the Loan
Agreement is hereby deleted in its entirety and the following substituted
therefor:

 

(c)                                  Borrower
shall, and shall cause each Subsidiary Guarantor to, permit the Administrative
Agent to have the Pool Vessels surveyed by marine engineers or other surveyors
selected by the Administrative Agent, in its sole discretion, at such times and
with such frequency as the Administrative Agent may reasonably request.  The costs of such surveys and inspections
shall be allocated as follows: (i) so long as no Event of Default has
occurred and is then continuing, the cost of one such survey and inspection
every three years shall be borne by Borrower, and (ii) whenever an Event
of Default exists hereunder, the costs of all surveys (including, without
limitation, Visual Surveys) and inspections shall be borne by Borrower.

 

(t)                                    Fixed Charge Coverage Ratio.  Section 7.01 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 7.01                            Fixed Charge Coverage Ratio. 
Borrower shall not
permit the Fixed Charge Coverage Ratio as of the end of any fiscal quarter to
be less than 2.25 to 1.00.

 

13

 

(u)                                 Total Funded Debt to EBITDA Ratio.  Section 7.03 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 7.03                            Total Funded Debt to EBITDA Ratio. 
Borrower shall not permit the Total Funded Debt to EBITDA Ratio at any time during each period set
forth below to be greater than the ratio set forth below with respect to such
period: 

 

	
  Period

  	
   

  	
  Ratio

  
	
  Effective Date
  to Amendment No. 1 Effective Date

  	
   

  	
  3.75 to 1.00

  
	
  Amendment
  No. 1 Effective Date to and including December 31, 2006

  	
   

  	
  4.00 to 1.00

  
	
  January 1,
  2007 and thereafter

  	
   

  	
  3.75 to 1.00

  

 

(v)                                 No Disposition of Assets.  Section 7.07 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 7.07                            No
Disposition of Assets.  Without
the prior written consent of Lenders (which shall not be unreasonably
withheld), Borrower shall not, and shall not permit any Subsidiary Guarantor
to, directly or indirectly sell, lease (other than a charter of a Pool Vessel
permitted under the Mortgage), transfer, assign, abandon, exchange or otherwise
relinquish possession or dispose of any part of the Collateral or any material
portion of its other assets (other than (i) Collateral or other assets
that are obsolete or worn out, or equipment disposed of, if worn out, and
replaced with equipment of the same or better quality and value, in the
ordinary course of business and (ii) sales, leases, transfers,
assignments, abandonments, exchanges, relinquishments of possession or
dispossessions of Collateral or other assets having an aggregate value not to
exceed $1,000,000 during the term hereof).

 

(w)                               Limitations on Advances and Distributions.  Section 7.11 of the Loan Agreement is
hereby deleted in its entirety and the following substituted therefor:

 

Section 7.11                            Limitations
on Advances and Distributions.  Borrower
shall not make distributions to any limited or general partner of Borrower
during the continuance of an Event of Default if, following the occurrence of
such Event of Default, Lenders send a notice to Borrower asserting or
confirming such Event of Default (regardless of whether any notice shall have
been required to create such Event of Default in any case).  Borrower shall not make any loans or advances
to any Affiliate or related Persons of Borrower, except K-Sea, any Excluded
Subsidiary and any Subsidiary Guarantor; provided that, (a) except
for the loan described in clause (b) of this proviso, the aggregate outstanding
amount of all such loans and advances to the Excluded Subsidiaries shall not
exceed $2,000,000 at any one time and (b) Borrower may make a loan to K-Sea
Canada Corp. in a principal amount not to exceed $13,100,000 for a term of not
more than six (6) months..

 

14

 

(x)                                 Notes.  Exhibit A
to the Loan Agreement is hereby deleted in its entirety and Exhibit A to
this Amendment substituted therefor.

 

(y)                               Pool Vessels.  Schedule 1.01 to the Loan Agreement is
hereby deleted in its entirety and Exhibit D
to this Amendment substituted therefor.

 

(z)                                 Commitments.  Schedule 2.01 to the Loan Agreement is
hereby deleted in its entirety and Exhibit E
to this Amendment substituted therefor.

 

(aa)                          General.

 

(i)                                     Lenders.  All
references to a “Lender” or the “Lenders” in the Loan Agreement or the other
Loan Documents shall be deemed to refer to the Lenders and the New Lender.

 

(ii)                                  Loan Agreement.  All
references to “this Agreement” in the Loan Agreement and to “the Loan Agreement”
in the other Loan Documents shall be deemed to refer to the Loan Agreement as
amended hereby.

 

(iii)                               Notes.  All references
to a “Note” or the “Notes” in the Loan Agreement or the other Loan Documents
shall be deemed to refer to the replacement Notes issued pursuant hereto.

 

3.                                     CONDITIONS TO EFFECTIVENESS.  This Amendment shall be effective upon the
satisfaction of each of the following conditions:

 

(a)                                The
Administrative Agent shall have received a certificate from the secretary of each
of Borrower and Sea Coast LLC attaching (i) a true and complete copy of
the resolutions of its Managing Person and of all documents evidencing all
necessary partnership or limited liability company action (in form and
substance satisfactory to the Administrative Agent) taken by it to authorize
the Loan Documents to which it is a party and the transactions contemplated
thereby, (ii) attaching a true and complete copy of its Organizational
Documents, (iii) setting forth the incumbency of its officer or officers
or other analogous counterpart who may sign the Loan Documents, including
therein a signature specimen of such officer or officers and (iv) attaching
a certificate of good standing of the Secretary of State of the jurisdiction of
its formation and of each other jurisdiction in which it is qualified to do
business.

 

(b)                               The
Administrative Agent (or its counsel) shall have received from each party
hereto either (x) a counterpart of this Amendment signed on behalf of such
party or (y) written evidence satisfactory to the Administrative Agent
(which may include telecopy transmission of a signed signature page of
this Amendment) that such party has signed a counterpart of this Amendment.

 

(c)                                The Administrative Agent shall have received a
Note for each Lender requesting the same duly signed on behalf of Borrower.

 

(d)                               The
Administrative Agent shall have received a counterpart of the acknowledgement
and consent annexed hereto duly executed by the K-Sea and K-Sea Transportation
Inc.

 

15

 

(e)                                The Administrative Agent shall have received a
Subsidiary Guaranty signed on behalf of Sea Coast LLC.

 

(f)                                  The
Administrative Agent shall have received a Supplement and Amendment No. 1
to the Mortgage in form and substance satisfactory to the Administrative Agent
duly signed on behalf of Borrower.

 

(g)                               The
Administrative Agent shall have received the following, each dated the
Amendment No. 1 Effective Date (unless otherwise specified), in form and
substance satisfactory to the Administrative Agent, and in sufficient copies:

 

(i)                                   proper
UCC Financing Statements and UCC Financing Statement Amendments under the
Uniform Commercial Code for all jurisdictions that the Administrative Agent may
deem necessary or desirable in order to perfect and protect the first and only
priority Liens and security interests created under the Loan Agreement, the
Mortgage, the Sea Coast Mortgage and the other Loan Documents, covering the
Collateral;

 

(ii)                                evidence
of the completion of all other recordings and filings of or with respect to the
Lien created by the Loan Agreement, the Sea Coast Mortgage and the other Loan
Documents that the Administrative Agent may deem necessary or desirable in
order to perfect and protect the Liens created by such Loan Documents;

 

(iii)                             with
respect to each Additional Pool Vessel described in Exhibit B hereto, the
following:

 

(A)                              the
Supplement and Amendment No. 1 to the Mortgage described in Section 3(f) above,
which shall cover such Additional Pool Vessel and, in connection therewith,
such Additional Pool Vessel shall have been duly documented in the name of the
Credit Party holding title thereto under the laws of the United States, such Supplement
and Amendment No. 1 to the Mortgage shall have been duly filed for
recording with the United States Coast Guard, and such Supplement and Amendment
No. 1 to the Mortgage shall constitute a preferred ship mortgage on such
Additional Pool Vessel;

 

(B)                                an
assignment covering the earnings and requisition compensation, if any, of such
Additional Pool Vessel, in form and substance satisfactory to the
Administrative Agent, duly executed by the Credit Party that is the owner of
such Additional Pool Vessel and, in connection therewith, such Credit Party
shall have executed and delivered to the Administrative Agent notices of
assignment and authorizations to collect insurance claims and to collect
general average contributions, in such form and in such number of counterparts
as may be reasonably requested by the Administrative Agent;

 

(C)                                an
assignment covering the insurances of such Additional Pool Vessel, in form and
substance satisfactory to the Administrative Agent, duly executed by the Credit
Party that is the owner of such Additional Pool Vessel;

 

(D)                               copies
of cover notes and certificates of entry evidencing the insurance covered by
such Additional Pool Vessel;

 

16

 

(E)                                 authorizations
to inspect class records of such Additional Pool Vessel by the Credit Party
that is the owner thereof, in such form and such number of counterparts as may
be reasonably requested by the Administrative Agent, duly executed by such
Credit Party;

 

(F)                                 a
true and complete copy of either (1) a certificate of ownership and
encumbrance issued by the United States Coast Guard or (2) an abstract of
title issued by the United States Coast Guard, in either case, showing such
Credit Party to be the sole owner of such Additional Pool Vessel free and clear
of all Liens of record except (x) the Mortgage covering such Additional Pool
Vessel in favor of the Collateral Trustee for the benefit of the Lenders, and
(y) the Permitted Liens;

 

(G)                                for
each Additional Pool Vessel to the extent it is required to be maintained in
class in order to operate in the service in which it is operating, the original
current confirmation certificate of American Bureau of Shipping for such
Additional Pool Vessel, confirming that such Additional Pool Vessel is in such
class without material recommendation, together with an American Bureau of
Shipping SafeNet database printout dated not more than twenty (20) days prior
to the Amendment No. 1 Effective Date, certified by an officer of Borrower
as true and correct;

 

(H)                               a
copy of the current certificate of inspection issued by the United States Coast
Guard for such Additional Pool Vessel, if available, and reflecting no
outstanding recommendations; and

 

(I)                                    (1)                                  written
advice from B&P International Insurance Brokerage LLC, insurance brokers,
of the placement of the insurances covering such Additional Pool Vessel; (2) written
confirmation from such brokers, that they have received no notice of the
assignment (except from the Administrative Agent) of the insurances or any
claim covering such Additional Pool Vessel; (3) an opinion of such brokers
to the effect that such insurance complies with the applicable provisions of
the Loan Agreement and of the Mortgage covering such Additional Pool Vessel,
where applicable; and (4) an agreement by such brokers, in form and
substance satisfactory to the Administrative Agent, whereunder the insurances
of such Additional Pool Vessel, and claims thereunder, will not be affected by
nonpayment of premiums on any other insurances;

 

(iv)                            with
respect to each Sea Coast Pool Vessel described in Exhibit C hereto, the
following:

 

(A)                              a
Mortgage covering such Sea Coast Pool Vessel duly executed by the Credit Party
that is the owner of such Sea Coast Pool Vessel and, in connection therewith,
such Sea Coast Pool Vessel shall have been duly documented in the name of the
Credit Party holding title thereto under the laws of the United States, such
Mortgage shall have been duly filed for recording with the United States Coast
Guard, and such Mortgage shall constitute a preferred ship mortgage on such Sea
Coast Pool Vessel;

 

(B)                                an
assignment covering the earnings and requisition compensation, if any, of such Sea
Coast Pool Vessel, in form and substance satisfactory to the Administrative
Agent, duly executed by the Credit Party that is the owner of such Sea Coast Pool
Vessel and, in connection therewith, such Credit Party shall have

 

17

 

executed and delivered to the Administrative Agent notices of
assignment and authorizations to collect insurance claims and to collect
general average contributions, in such form and in such number of counterparts
as may be reasonably requested by the Administrative Agent;

 

(C)                                an
assignment covering the insurances of such Sea Coast Pool Vessel, in form and
substance satisfactory to the Administrative Agent, duly executed by the Credit
Party that is the owner of such Sea Coast Pool Vessel;

 

(D)                               copies
of cover notes and certificates of entry evidencing the insurance covered by
such Sea Coast Pool Vessel;

 

(E)                                 authorizations
to inspect class records of such Sea Coast Pool Vessel by the Credit Party that
is the owner thereof, in such form and such number of counterparts as may be
reasonably requested by the Administrative Agent, duly executed by such Credit
Party;

 

(F)                                 a
true and complete copy of either (1) a certificate of ownership and
encumbrance issued by the United States Coast Guard or (2) an abstract of
title issued by the United States Coast Guard, in either case, showing such
Credit Party to be the sole owner of such Sea Coast Pool Vessel free and clear
of all Liens of record except (x) the Mortgage covering such Sea Coast Pool
Vessel in favor of the Collateral Trustee for the benefit of the Lenders, and
(y) the Permitted Liens;

 

(G)                                for
each Sea Coast Pool Vessel to the extent it is required to be maintained in
class in order to operate in the service in which it is operating, the original
current confirmation certificate of American Bureau of Shipping for such Sea
Coast Pool Vessel, confirming that such Sea Coast Pool Vessel is in such class
without material recommendation, together with an American Bureau of Shipping
SafeNet database printout dated not more than twenty (20) days prior to the
Amendment No. 1 Effective Date, certified by an officer of Borrower as
true and correct;

 

(H)                               a
copy of the current certificate of inspection issued by the United States Coast
Guard for such Sea Coast Pool Vessel, if available, and reflecting no
outstanding recommendations; and

 

(I)                                    (1)                                  written
advice from B&P International Insurance Brokerage LLC, insurance brokers,
of the placement of the insurances covering such Sea Coast Pool Vessel; (2) written
confirmation from such brokers, that they have received no notice of the
assignment (except from the Administrative Agent) of the insurances or any
claim covering such Sea Coast Pool Vessel; (3) an opinion of such brokers
to the effect that such insurance complies with the applicable provisions of the
Loan Agreement and of the Mortgage covering such Sea Coast Pool Vessel, where
applicable; and (4) an agreement by such brokers, in form and substance
satisfactory to the Administrative Agent, whereunder the insurances of such Sea
Coast Pool Vessel, and claims thereunder, will not be affected by nonpayment of
premiums on any other insurances; and

 

(v)                               with
respect to not less than five (5) of the Pool Vessels described on Exhibit D
hereto (other than the Additional Pool Vessels described on Exhibit B
hereto and the Sea Coast Pool Vessels described on Exhibit C hereto), a
true

 

18

 

and complete copy of either (A) a certificate of ownership and
encumbrance issued by the United States Coast Guard or (B) an abstract of
title issued by the United States Coast Guard, in either case, showing the
Credit Party that is the owner of such Pool Vessel to be the sole owner of such
Pool Vessel free and clear of all Liens of record except (x) the Mortgage
covering such Pool Vessel in favor of the Collateral Trustee for the benefit of
the Lenders, and (y) the Permitted Liens.

 

(h)                               The
Administrative Agent shall have received a certificate, dated the Amendment No. 1
Effective Date and signed by a Financial Officer of Borrower,

 

(i)                                     confirming
that (1) the Sea Coast Acquisition Transactions have been consummated, (2) the
Sea Coast Acquisition has been consummated in accordance with the terms and
conditions of the applicable Sea Coast Acquisition Documents, all of which
shall be in form and substance reasonably satisfactory to the Administrative
Agent, and (3) the total consideration paid in connection with the Sea
Coast Acquisition was not more than the Purchase Price, subject to adjustment
pursuant to the terms of the Sea Coast Acquisition Documents; and

 

(ii)                                  attaching
a true, complete and correct copy of each of the following (each of which shall
be in form and substance reasonably satisfactory to the Administrative Agent): (1) each
Sea Coast Acquisition Document (including, without limitation, the Vessel
Purchase Agreement dated October 18, 2005 between Sea Coast LLC and Sea
Coast Seller and the instruments, documents and agreements executed and
delivered in connection therewith) and (2) any information the
Administrative Agent may reasonably require regarding the assets and
liabilities of the Borrower and Sea Coast LLC after giving effect to the
consummation of the Sea Coast Acquisition.

 

(i)                                   The Administrative Agent shall have received
Uniform Commercial Code, tax and judgment lien search reports with respect to
each applicable public office where Liens are or may be filed disclosing that
there are no Liens of record in such official’s office covering any Collateral
or showing Borrower or any other Credit Party as debtor thereunder (other than
Permitted Liens) and a certificate of an officer of Borrower, dated the
Effective Date, certifying that, upon the making of the Loans there will exist
no Liens on the Collateral other than Permitted Liens.

 

(j)                                   The
Administrative Agent shall have received and accepted a desktop or visual
Appraisal of all Additional Pool Vessels and Sea Coast Pool Vessels, which
shall be in form and substance satisfactory to the Administrative Agent, and
which shall demonstrate that the Orderly Liquidation Value of the Pool Vessels
(including the Additional Pool Vessels and 
the Sea Coast Pool Vessels) as of the Amendment No. 1 Effective
Date is not less than $150,000,000.00.

 

(k)                                The
Administrative Agent shall have received satisfactory evidence that the
Additional Pool Vessels and the Sea Coast Pool Vessels are operationally
suitable for the trades in which the Additional Pool Vessels and the Sea Coast
Pool Vessels are expected to be engaged and can be operated by Borrower and/or
Sea Coast LLC in their intended trades without impediment.

 

(l)                                     No
Event of Loss shall have occurred with respect to any of the Pool Vessels.

 

19

 

(m)                               The
Administrative Agent shall be reasonably satisfied that there is no litigation
or administrative proceeding, or regulatory development, that could reasonably
be expected to have a material adverse effect on (i) the business, assets,
operations, condition (financial or otherwise) or material agreements of the
Borrower and its Subsidiaries, (ii) the business, assets, operations,
condition (financial or otherwise) or material agreements of Sea Coast Towing
or Sea Coast LLC, (iii) the ability of any Credit Party to perform any of
its obligations under any Loan Document, (iv) the rights of or benefits
available to the Administrative Agent, the Collateral Trustee or any Lender
under any Loan Document or (v) the ability of any party to the Sea Coast Acquisition
Documents to perform any of its obligations under the Sea Coast Acquisition
Documents.

 

(n)                                 The
Lenders shall have completed a due diligence investigation of Sea Coast Seller,
Sea Coast Towing and Sea Coast LLC in scope, and with results, satisfactory to
the Lenders; Sea Coast Towing and Sea Coast LLC shall have given the
Administrative Agent such access to their respective books and records as the
Administrative Agent may have requested upon reasonable notice in order to
carry out its investigations, appraisals and analyses, and the Administrative
Agent shall have received all additional financial, business and other
information regarding Sea Coast Towing and Sea Coast LLC and their respective
properties as the Administrative Agent shall have reasonably requested.

 

(o)                                 The
Lenders shall be reasonably satisfied that no material adverse change in the
business, assets, operations, properties, condition (financial or otherwise),
liabilities (including contingent liabilities) or material agreements of (i) Borrower
and its Subsidiaries or (ii) Sea Coast Towing has occurred since December 31,
2004.

 

(p)                                 There
shall be no injunction, writ, preliminary restraining order or other order of
any nature issued by any Governmental Authority in any respect affecting (i) the
transactions provided for in this Amendment, the Loan Documents or the Sea
Coast Acquisition Documents or (ii) the Sea Coast Acquisition Transactions
and no action or proceeding by or before any Governmental Authority shall have
been commenced and be pending or, to the knowledge of Borrower, threatened,
seeking to prevent or delay the transactions contemplated by (x) this
Amendment, the Loan Documents or the Sea Coast Acquisition Documents or (y) the
Sea Coast Acquisition Transactions or challenging any other terms and
provisions hereof or thereof or seeking any damages in connection herewith or
therewith, and the Administrative Agent shall have received a certificate, in
all respects reasonably satisfactory to the Administrative Agent, of a
Financial Officer of Borrower to the foregoing effect.

 

(q)                                 All
material approvals and consents of all Persons required to be obtained in
connection with the consummation of the Sea Coast Acquisition Transactions shall
have been obtained and shall be in full force and effect, and all required
notices have been given and all required waiting periods shall have expired,
and the Administrative Agent shall have received a certificate, in all respects
reasonably satisfactory to the Administrative Agent, of an officer of Borrower
to the foregoing effect.

 

(r)                                    The
Administrative Agent shall have received copies of such environmental studies,
surveys and reports, in form and substance satisfactory to the Administrative
Agent, as the Administrative Agent may reasonably require, with respect to the
real property owned or leased by Sea Coast Towing or Sea Coast LLC.

 

20

 

(s)                                  The
Administrative Agent shall have received and be reasonably satisfied with (i) the
audited balance sheet of Sea Coast Towing as at December 31, 2002, December 31,
2003 and December 31, 2004 and the audited results of operations, cash
flows and stockholders’ equity of Sea Coast Towing for the fiscal years ending on
December 31, 2003 and December 31, 2004, in each case prepared in
accordance with GAAP consistently applied, (ii) the financial statements
of Sea Coast Towing as at and for the fiscal quarter ending on June 30,
2005 and the then elapsed portion of the fiscal year, setting forth in each
case in comparative form the figures for the corresponding fiscal quarter end,
and period or periods, of the previous fiscal year, (iii) biographical
information in form and substance satisfactory to the Administrative Agent with
respect to such members of Sea Cost Towing’s officers as the Administrative
Agent may reasonably request, together with a summary of the anticipated roles
of such officers after the consummation of the Sea Coast Acquisition and (iv) the
audited consolidated Financial Statements (with an unqualified opinion) of
Borrower and K-Sea as at and for the fiscal year ending July 1, 2005,
prepared and certified by PricewaterhouseCoopers LLP.

 

(t)                                    The
Administrative Agent shall have received and be satisfied with consolidated and
consolidating pro forma balance sheets of the Borrower and its Subsidiaries as
of the Amendment No. 1 Effective Date, after giving effect to the Sea
Coast Acquisition Transactions (including all debt and equity issuances in
connection therewith).

 

(u)                                 All
indebtedness of Sea Coast Towing or Sea Coast LLC to Bank of America, N.A. (as
Trustee for certain secured creditors) shall have been unconditionally paid in
full, Sea Coast Towing and Sea Coast LLC shall have terminated any commitments
or lines of credit made available to Sea Coast Towing or Sea Coast LLC, any and
all guaranties by Sea Coast Towing or Sea Coast LLC of any indebtedness,
liabilities or obligations of any other Person shall have been terminated and
all liens, if any, securing such indebtedness or guaranties shall have been
released or terminated, and all other obligations, if any, with respect thereto
shall have been duly and finally extinguished.

 

(v)                                 The
EBITDA of Borrower and the Guarantors for the four fiscal quarter period ending
June 30, 2005, determined on a pro forma basis as if the Sea Coast
Acquisition Transactions had been consummated on July 1, 2004, shall be
not less than $50,000,000, and the Administrative Agent shall have received a
certificate of Financial Officer of Borrower, in all respects reasonably
satisfactory to the Administrative Agent, to such effect.

 

(w)                               The
Administrative Agent shall have received a certificate, dated the Amendment No. 1
Effective Date and signed by a Financial Officer of the Borrower, setting forth
reasonably detailed calculations demonstrating compliance with Sections 7.01.
7.02, 7.03 and 7.04 on a pro forma basis as of the Amendment No. 1
Effective Date, immediately after giving effect to the Sea Coast Acquisition
Transactions.

 

(x)                                   The
Administrative Agent shall have received favorable written opinions (each addressed
to the Lenders, the Administrative Agent and the Collateral Trustee and dated
the Amendment No. 1 Effective Date) from Thompson Coburn L.L.P. and Holland &
Knight LLP, on behalf of the Credit Parties, in form and substance satisfactory
to the Administrative Agent covering such matters relating to the Credit

 

21

 

Parties, the Loan Documents or the Sea Coast Acquisition as the
Administrative Agent shall reasonably request. 
Borrower hereby requests such counsel to deliver such opinions.

 

(y)                                 The
representations and warranties contained in the Loan Agreement shall be true
and correct in all material respects, except
to the extent such representations and warranties relate to an earlier date
and, after giving effect to the amendments set forth in Section 2 hereof,
no Default or Event of Default shall exist.

 

(z)                                   The
Administrative Agent shall have received all fees and other amounts due and
payable on or prior to the Amendment No. 1 Effective Date, including, to
the extent invoiced, reimbursement or payment of all out-of-pocket expenses
required to be reimbursed or paid by Borrower hereunder.

 

(aa)                            All
legal matters with respect to and all legal documents (including, but not
limited to, the Loan Documents) executed in connection with the transactions
contemplated by this Amendment shall be satisfactory to counsel for the
Administrative Agent.

 

(bb)                          Borrower
shall have paid the reasonable fees and disbursements of counsel to the
Administrative Agent and the Lenders in connection with this Amendment.

 

The
Administrative Agent shall notify Borrower and the Lenders of the Amendment No. 1
Effective Date, and such notice shall be conclusive and binding.

 

4.                                     REPRESENTATIONS AND WARRANTIES.  Borrower hereby represents and warrants to
the Administrative Agent and the Lenders that:

 

(a)                                  The
representations and warranties set forth in the Loan Documents are true and
correct in all material respects as of the date hereof and with the same effect
as though made on and as of the date hereof, except to the extent such
representations and warranties relate to an earlier date.

 

(b)                                 No
Default or Event of Default and no event or condition which, with the giving of
notice or lapse of time or both, would constitute such a Default or Event of
Default, now exists or would exist.

 

(c)                                  (i) 
The execution, delivery and performance by Borrower of this Amendment is within
its organizational powers and have been duly authorized by all necessary action
(corporate or otherwise) on the part of Borrower, (ii) this Amendment is
the legal, valid and binding obligation of Borrower, enforceable against
Borrower in accordance with its terms, and (iii) neither this Amendment
nor the execution, delivery and performance by Borrower hereof: (A) contravenes
the terms of Borrower’s organization documents, (B) conflicts with or
results in any breach or contravention of, or the creation of any Lien under,
any document evidencing any contractual obligation to which Borrower is a party
or any order, injunction, writ or decree to which Borrower or its property is
subject, or (C) violates any requirement of law

 

22

 

5.                                       EFFECT; NO WAIVER.

 

(a)                                  Borrower
hereby (i) reaffirms and admits the validity and enforceability of the
Loan Documents and all of its obligations thereunder and (ii) agrees and
admits that it has no existing defenses to or offsets against any such
obligation. Except as specifically set forth herein, the Loan Agreement and the
other Loan Documents shall remain in full force and effect in accordance with
their terms and are hereby ratified and confirmed.  The execution, delivery and effectiveness of
this Amendment shall not operate as a waiver of any existing or future Default
or Event of Default, whether known or unknown or any right, power or remedy of
the Administrative Agent or the Lenders under the Loan Agreement, nor
constitute a waiver of any provision of the Loan Agreement, except as
specifically set forth herein.

 

(b)                                 Borrower
hereby (i) reaffirms all of its agreements and obligations under the Loan Documents,
(ii) reaffirms that all Obligations of Borrower under or in connection
with the Loan Agreement as amended hereby are “Obligations”
as that term is defined in the Loan Documents and (iii) reaffirms that all
such Obligations continue to be secured by the Loan Documents, which remain in
full force and effect and are hereby ratified and confirmed.

 

6.                                       MISCELLANEOUS.

 

(a)                                  Borrower
and Sea Coast LLC will cause all Additional Pool Vessels and all Sea Coast Pool
Vessels to be subjected to a Lien securing the Obligations and will take, such
actions as shall be necessary or reasonably requested by the Administrative
Agent to grant and perfect such Liens, including, with out limitation,
executing any and all further documents, financing statements, agreements and
instruments, and taking all such further actions (including the filing and
recording of preferred ship mortgages, financing statements, and any other instrument or agreement of assignment
that the Administrative Agent may reasonably request with the United States
Coast Guard), that may be required under any applicable law, or which
the Administrative Agent or the Required Lenders may reasonably request, to
effectuate the transactions contemplated hereby or to grant, preserve, protect
or perfect the Liens created or intended to be created by the Loan Documents or
the validity or priority of any such Lien, all at the expense of Borrower.

 

(b)                                 Borrower
shall pay the Administrative Agent upon demand for all reasonable expenses,
including reasonable attorneys’ fees and expenses of the Administrative Agent,
incurred by the Administrative Agent in connection with the preparation,
negotiation and execution of this Amendment.

 

(c)                                  THIS
AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS (AS OPPOSED TO THE CONFLICTS OF LAW PROVISIONS, BUT INCLUDING SECTIONS 5-1401
AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK) AND
DECISIONS OF THE STATE OF NEW YORK.

 

(d)                                 This
Amendment shall be binding upon Borrower, the Administrative Agent and the
Lenders and their respective successors and assigns, and shall inure to the
benefit of Borrower, the Administrative Agent and the Lenders and the
respective successors and assigns of the Administrative Agent and the Lenders.

 

23

 

(e)                                  This
Amendment may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed and
delivered shall be deemed to be an original and all of which taken together
shall constitute one and the same instrument.

 

[Signature pages follow.]

 

24

 

AS EVIDENCE
of the agreement by the parties hereto to the terms and conditions herein
contained, each such party has caused this Amendment to be executed on its
behalf.

 

	
   

  	
  K-SEA OPERATING PARTNERSHIP

  L.P., by its general partner K-Sea OLP

  GP, LLC, as Borrower

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John J. Nicola

  	
   

  
	
   

  	
  Name:

  	
  John J.
  Nicola

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  KEYBANK NATIONAL

  ASSOCIATION, for itself as Lender, and

  as Administrative Agent and as Collateral

  Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Steven B.
  Vitale

  	
   

  
	
   

  	
  Name:

  	
  Steven B. Vitale

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  LASALLE
  BANK NATIONAL

  ASSOCIATION, as Syndication Agent and

  Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kathleen L.
  Ross

  	
   

  
	
   

  	
  Name:

  	
  Kathleen L. Ross

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  CITIZENS BANK OF PENNSYLVANIA

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Devon Starks

  	
   

  
	
   

  	
  Name:

  	
  Devon Starks

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  WACHOVIA
  BANK, NATIONAL

  ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen Karp

  	
   

  
	
   

  	
  Name:

  	
  Stephen Karp

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  
								

 

K-SEA OPERATING
PARTNERSHIP AMENDMENT NO. 1

 

 

ACKNOWLEDGEMENT AND CONSENT

 

Each of the undersigned
Guarantors hereby (1) consents to the execution and delivery by the
Borrower of the foregoing Amendment No. 1; (2) agrees that the
definition of “Obligations”
(and any other term referring to the indebtedness, liabilities and obligations
of Borrower to the Administrative Agent or any of the Lenders) in the Parent
Guaranty or its Subsidiary Guaranty, as the case may be, and the other Loan
Documents shall include the Indebtedness of the Borrower under the forgoing
Amendment No. 1; (3) agrees that the definition of “Loan Agreement”
in the Parent Guaranty or its Subsidiary Guaranty, as the case may be, and the
other Loan Documents to which it is a party is hereby amended to mean the Loan
Agreement as amended by the foregoing Amendment No. 1; (4) reaffirms
its continuing liability under the Parent Guaranty or its Subsidiary Guaranty,
as the case may be (as modified hereby); (5) reaffirms all of its
agreements and obligations under the Loan Documents to which it is a party; (6) reaffirms
that all Obligations of the Borrower under or in connection with the Loan
Agreement as amended by the foregoing Amendment No. 1 are “Obligations” as that term is
defined in the Parent Guaranty or its Subsidiary Guaranty, as the case may be; (7) reaffirms
that all such Obligations continue to be secured by the Loan Documents to which
it is a party, which remain in full force and effect and are hereby ratified
and confirmed; and (8) confirms and agrees that it is a Guarantor and that
the Parent Guaranty or its Subsidiary Guaranty, as the case may be, and the
other Loan Documents to which it is a party are, and shall continue to be, in
full force and effect in accordance with their respective terms.

 

 

	
   

  	
  K-SEA TRANSPORTATION PARTNERS

  L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John J. Nicola

  	
   

  
	
   

  	
  Name:

  	
  John J.
  Nicola

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  K-SEA TRANSPORTATION INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John J. Nicola

  	
   

  
	
   

  	
  Name:

  	
  John J.
  Nicola

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  
						

 

 

EXHIBIT A

TO

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

FORM OF NOTE

 

	
  $

  	
  October 18, 2005

  
	
   

  	
  New York, New York

  

 

FOR VALUE RECEIVED, the undersigned, K-SEA OPERATING PARTNERSHIP L.P., a Delaware limited
partnership (“Borrower”), hereby promises to pay
to the order
of                              (the
“Lender”)                              DOLLARS
($                              )
or if less, the unpaid principal amount of the Loans made by the Lender to
Borrower, in the amounts and at the times set forth in the Loan and Security
Agreement, dated as of March 24, 2005 (as amended by Amendment No. 1
to Loan and Security Agreement dated as of the date hereof and as the same may
be further amended, supplemented or otherwise modified from time to time, the “Loan Agreement”), among Borrower, the Lenders party thereto,
and KeyBank National Association, as Administrative Agent and Collateral
Trustee, and to pay interest from the date hereof on the principal balance of
such Loans from time to time outstanding at the rate or rates and at the times
set forth in the Loan Agreement, in each case at the office of the
Administrative Agent located at 127 Public Square, Cleveland, Ohio 44114, Attn.
KCIB Loan Services, or at such other place as the Administrative Agent may
specify from time to time, in lawful money of the United States of America in
immediately available funds.  Terms
defined in the Loan Agreement are used herein with the same meanings.

 

The Loans evidenced by this Note are
prepayable in the amounts, and under the circumstances, and their respective
maturities are subject to acceleration upon the terms, set forth in the Loan
Agreement.  This Note is subject to, and
should be construed in accordance with, the provisions of the Loan Agreement
and is entitled to the benefits and security set forth in the Loan Documents.

 

The Lender is hereby authorized to record on the schedule annexed
hereto, and any continuation sheets which the Lender may attach hereto, (a) the
date of each Loan made by the Lender, (b) whether such Loan is a Base Rate
Loan or a LIBOR Loan and amount thereof, (c) the interest rate (without
regard to the Applicable Margin) and Interest Period applicable to each LIBOR
Loan and (d) the date and amount of each conversion of, and each payment
or prepayment of the principal of, any such Loan.  The entries made in such schedule shall
be prima facie evidence of the existence and amounts of the obligations
recorded therein, provided that the failure to so record or any error therein
shall not in any manner affect the obligation of Borrower to repay the Loans in
accordance with the terms of the Loan Agreement.

 

[This Note shall be deemed to be
in complete substitution for and replacement of, and not a repayment of the
Note dated March 24, 2005 made by Borrower payable to order of the Lender
(the “Prior Note”) and all
interest accrued and unpaid under such Prior Note shall be deemed evidenced by
this Note and payable hereunder from and after the date of accrual
thereof.  The execution and delivery of
this Note shall not be construed (i) to have constituted repayment of any
amount of principal or interest on the Prior Note, or (ii) to release,
cancel, terminate or otherwise impair all or any part of any lien or security
interest granted to the Lenders party to the Loan Agreement or their agents as
collateral security for the Prior Note.] (1)

 

(1) This
paragraph shall be included in the Note of each Lender except the New Lender.

 

 

Except as specifically otherwise provided in
the Loan Agreement, Borrower hereby waives presentment, demand, notice of
dishonor, protest, notice of protest and all other demands, protests and
notices in connection with the execution, delivery, performance, collection and
enforcement of this Note.

 

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

	
   

  	
  K-SEA OPERATING PARTNERSHIP L.P.,

  by its general partner K-Sea OLP GP, LLC,

  as Borrower

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
  John J. Nicola

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  

 

2

 

 

SCHEDULE TO NOTE

 

	
  Date

  	
   

  	
  Type of Loan

  	
   

  	
  Amount

  of Loan

  	
   

  	
  Amount of

  principal

  converted,

  paid or

  prepaid

  	
   

  	
  Interest rate

  on LIBOR

  Loans

  	
   

  	
  Interest Period

  for LIBOR

  Loans

  	
   

  	
  Notation

  made by

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

EXHIBIT B

TO

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

ADDITIONAL POOL VESSELS

 

	
  Vessel Name

  	
   

  	
  Official No.

  
	
   

  	
   

  	
   

  
	
  KTC 50

  	
   

  	
  555901

  
	
   

  	
   

  	
   

  
	
  KTC 55

  	
   

  	
  544437

  
	
   

  	
   

  	
   

  
	
  Casablanca

  	
   

  	
  901203

  
	
   

  	
   

  	
   

  
	
  Maryland

  	
   

  	
  287444

  
	
   

  	
   

  	
   

  
	
  Houma

  	
   

  	
  528526

  
	
   

  	
   

  	
   

  
	
  Odin

  	
   

  	
  647313

  
	
   

  	
   

  	
   

  
	
  Taurus

  	
   

  	
  602379

  
	
   

  	
   

  	
   

  
	
  Falcon

  	
   

  	
  598501

  
	
   

  	
   

  	
   

  
	
  Banda Sea

  	
   

  	
  504169

  
	
   

  	
   

  	
   

  
	
  Davis Sea

  	
   

  	
  651977

  
	
   

  	
   

  	
   

  
	
  Norwegian Sea

  	
   

  	
  574955

  
	
   

  	
   

  	
   

  
	
  Sargasso Sea

  	
   

  	
  547618

  
	
   

  	
   

  	
   

  
	
  Timor Sea

  	
   

  	
  283906

  

 

 

EXHIBIT C

TO

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

SEA COAST POOL VESSELS

 

	
  VESSEL NAME

  	
   

  	
  OFFICIAL NO.

  
	
   

  	
   

  	
   

  
	
  Pacific Eagle

  	
   

  	
  500126

  
	
   

  	
   

  	
   

  
	
  Tiger

  	
   

  	
  502116

  
	
   

  	
   

  	
   

  
	
  Pacific Pride

  	
   

  	
  583851

  
	
   

  	
   

  	
   

  
	
  Pacific Challenger

  	
   

  	
  571631

  
	
   

  	
   

  	
   

  
	
  Pacific Freedom

  	
   

  	
  521494

  
	
   

  	
   

  	
   

  
	
  Pacific Raven

  	
   

  	
  529686

  
	
   

  	
   

  	
   

  
	
  Paragon

  	
   

  	
  596518

  
	
   

  	
   

  	
   

  
	
  Pacific Patriot

  	
   

  	
  627416

  
	
   

  	
   

  	
   

  
	
  Sea Hawk

  	
   

  	
  589839

  
	
   

  	
   

  	
   

  
	
  Pacific Avenger

  	
   

  	
  586202

  
	
   

  	
   

  	
   

  
	
  John Brix

  	
   

  	
  293323

  
	
   

  	
   

  	
   

  
	
  Pacific Wolf

  	
   

  	
  567630

  
	
   

  	
   

  	
   

  
	
  Puget Sounder

  	
   

  	
  981972

  
	
   

  	
   

  	
   

  
	
  Pacific

  	
   

  	
  996165

  
	
   

  	
   

  	
   

  
	
  Sasanoa

  	
   

  	
  1110781

  

 

 

EXHIBIT D

TO

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

SCHEDULE 1.01

 

Pool Vessels

 

	
  VESSEL
  NAME

  	
   

  	
  OFFICIAL NO.

  	
   

  	
  REGISTERED OWNER

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Double Hull Barges

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DBL 151

  	
   

  	
   

  	
  641082

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 152

  	
   

  	
   

  	
  644380

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 155

  	
   

  	
   

  	
  556673

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 152

  	
   

  	
   

  	
  644380

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 155

  	
   

  	
   

  	
  556673

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 140

  	
   

  	
   

  	
  1090503

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 70

  	
   

  	
   

  	
  540401

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 31

  	
   

  	
   

  	
  1079242

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 32

  	
   

  	
   

  	
  1087118

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 17

  	
   

  	
   

  	
  1065655

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 18

  	
   

  	
   

  	
  1065657

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 19

  	
   

  	
   

  	
  1065658

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  DBL 53

  	
   

  	
   

  	
  500121

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Pacific

  	
   

  	
   

  	
  996165

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Puget Sounder

  	
   

  	
   

  	
  981972

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Sasanoa

  	
   

  	
   

  	
  1110781

  	
   

  	
  Sea Coast Transportation LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Single Hull Barges

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  KTC 80

  	
   

  	
   

  	
  643281

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  KTC 71

  	
   

  	
   

  	
  563364

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  KTC 60

  	
   

  	
   

  	
  630272

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  KTC 50

  	
   

  	
   

  	
  555901

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  KTC 55

  	
   

  	
   

  	
  544437

  	
   

  	
  K-Sea Operating Partnership L.P.

  

 

 

	
  Tugs

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Rebel

  	
   

  	
   

  	
  570047

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Yankee

  	
   

  	
   

  	
  571215

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Irish Sea

  	
   

  	
   

  	
  520685

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Viking

  	
   

  	
   

  	
  541711

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Lincoln Sea

  	
   

  	
   

  	
  1084513

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Beaufort Sea

  	
   

  	
   

  	
  536836

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Tasman Sea

  	
   

  	
   

  	
  578207

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Adriatic Sea

  	
   

  	
   

  	
  590232

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Coral Sea

  	
   

  	
   

  	
  550670

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Java Sea

  	
   

  	
   

  	
  636105

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Baltic Sea

  	
   

  	
   

  	
  551908

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Bering Sea

  	
   

  	
   

  	
  569665

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Casablanca

  	
   

  	
   

  	
  901203

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Maryland

  	
   

  	
   

  	
  287444

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Houma

  	
   

  	
   

  	
  528526

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Odin

  	
   

  	
   

  	
  647313

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Taurus

  	
   

  	
   

  	
  602379

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Falcon

  	
   

  	
   

  	
  598501

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Banda Sea

  	
   

  	
   

  	
  504169

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Davis Sea

  	
   

  	
   

  	
  651977

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Norwegian Sea

  	
   

  	
   

  	
  574955

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Sargasso Sea

  	
   

  	
   

  	
  547618

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Timor Sea

  	
   

  	
   

  	
  283906

  	
   

  	
  K-Sea Operating Partnership L.P.

  
	
  Pacific Eagle

  	
   

  	
   

  	
  500126

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Tiger

  	
   

  	
   

  	
  502116

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Pacific Pride

  	
   

  	
   

  	
  583851

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Pacific Challenger

  	
   

  	
   

  	
  571631

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Pacific Freedom

  	
   

  	
   

  	
  521494

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Pacific Raven

  	
   

  	
   

  	
  529686

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Paragon

  	
   

  	
   

  	
  596518

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Pacific Patriot

  	
   

  	
   

  	
  627416

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Sea Hawk

  	
   

  	
   

  	
  589839

  	
   

  	
  Sea Coast Transportation LLC

  

 

 

	
  Pacific Avenger

  	
   

  	
   

  	
  586202

  	
   

  	
  Sea Coast Transportation LLC

  
	
  John Brix

  	
   

  	
   

  	
  293323

  	
   

  	
  Sea Coast Transportation LLC

  
	
  Pacific Wolf

  	
   

  	
   

  	
  567630

  	
   

  	
  Sea Coast Transportation LLC

  

 

 

EXHIBIT E

TO

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

SCHEDULE 2.01

 

Amendment No. 1 Effective
Date Commitments

 

	
  Lender

  	
   

  	
  Commitment

  	
   

  
	
  KeyBank National Association

  	
   

  	
  $

  	
  45,000,000.00

  	
   

  
	
  LaSalle Bank National Association

  	
   

  	
  $

  	
  25,000,000.00

  	
   

  
	
  Citizens Bank of Pennsylvania

  	
   

  	
  $

  	
  32,000,000.00

  	
   

  
	
  Wachovia Bank, National Association

  	
   

  	
  $

  	
  18,000,000.00

  	
   

  
	
  Aggregate
  Commitments

  	
   

  	
  $

  	
  120,000,000.00Exhibit 10.1

 

LOCK-UP AGREEMENT

 

This Lock-Up Agreement (this “Agreement”) is made and entered into as of October 19,
2005 by and between FEI Company, an Oregon corporation (the “Company”), and [Name of Option Holder] (“Optionee”). The Company and Optionee are
parties to Stock Option Agreements dated as of [Insert dates of original
agreements] (each being an “Original
Agreement” and collectively “Original Agreements”).
Capitalized terms in this Agreement which are not defined herein shall have the
meanings ascribed to them in the Original Agreement.

 

NOW, THEREFORE, in consideration of the usual
promises hereinafter set forth, the parties hereto agree as follows:

 

AGREEMENT

 

1.             Any and all rights and obligations of
Optionee under the each Original Agreement shall be subject to the conditions,
restrictions and covenants contained herein.

 

2.             The Board of Directors, in its discretion,
may accelerate the vesting of any of the shares subject to any Option (the “Accelerated
Shares”), in which event the Accelerated Shares shall be restricted upon
exercise, with the restriction to lapse with respect to the Accelerated
Shares on each vesting date following the date of acceleration. Provided,
however, that such restrictions shall lapse upon (i) termination of
employment due to death to the extent that the Original Agreement provided for
accelerated vesting in such event, or (ii) any event under any separate
agreement between the Optionee and the Company that would have caused any
unvested portion of the Option to become immediately exercisable prior to the
acceleration described in this Agreement. For purposes of this section, the
restriction on the Accelerated Shares prohibits Optionee from selling,
assigning, pledging, or in any manner transferring such restricted Accelerated
Shares, or any right or interest in such restricted Accelerated Shares, whether
voluntarily or by operation of law, or by gift, bequest or otherwise. Any sale
or transfer, or purported sale or transfer, of restricted Accelerated Shares,
in violation of this provision shall be null and void.

 

3.             Defined terms used in this Agreement shall
have the same meaning as in the Original Agreement, unless defined herein.

 

4.             The rights, restrictions, conditions and
covenants contained herein shall survive Optionee’s termination of employment
(except due to death as provided in Section 1 above). Except as set forth
herein, the terms of the Original Agreement are unchanged and remain in full
force and effect.

 

IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed and effective as of the date first written
above.

 

	
  COMPANY:

  	
  FEI COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: Vahé A. Sarkissian

  
	
   

  	
  Title: Chairman

  
	
   

  	
   

  
	
   

  	
   

  
	
  OPTIONEE:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00092-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00092-of-00352.parquet"}]]