Common use of Additional Mortgage Clause in Contracts

Additional Mortgage. (a) K-Sea OLP agrees to and shall execute the Additional Mortgage and the Additional Assignment of Insurance in favor of the Secretary as collateral to secure the obligations of the Partnerships hereunder and under the other Documents. The Partnerships and the Secretary agree that: (1) The Additional Mortgage, as originally executed, shall cover the Additional Vessels with an aggregate Orderly Liquidation Value equal to or exceeding Ten Million Dollars ($10,000,000), which shall be maintained for the duration of the Additional Mortgage specified below. If the Orderly Liquidation Value of the Additional Vessels drops below $10,000,000, then upon receiving written notice from the Secretary the Partnerships shall promptly add additional collateral in favor of the Secretary such that the aggregate of the Additional Vessels and such new collateral equals at least $10,000,000; (2) The Additional Mortgage may be supplemented from time to time, and the Secretary shall provide its consent as mortgagee when requested, to replace, remove or otherwise change any Additional Vessel covered under the Additional Mortgage with a different vessel or vessels that satisfy the requirements of Additional Vessel as set forth in the definition of Additional Vessel in Attachment A herein, PROVIDED, THAT, the aggregate Orderly Liquidation Value of the Additional Vessels under the Additional Mortgage, as supplemented, equals or exceeds Ten Million Dollars ($10,000,000); (3) No hire, freights, or earnings or any other revenue relating to any Additional Vessel shall be assigned or pledged by the Partnerships to any entity; and (b) The Additional Mortgage shall terminate on December 31, 2008 if, at such time, (i) there is no default under the Security Agreement that is continuing and (ii) the Consolidated Group meets the requirements with respect to Fixed Charge Coverage Ratio, Net Worth and Long Term Debt as set forth in Section 8(b)(i), (ii) and (iii) herein based on the Consolidated Group's financial statements dated December 31, 2007, June 30, 2008 and December 31, 2008. If the Consolidated Group is not in compliance with the requirements with respect to Fixed Charge Coverage Ratio, Net Worth and Long Term Debt as set forth in Section 8(b)(i), (ii) and (iii) herein on December 31, 2008, the Additional Mortgage shall terminate upon the receipt of four consecutive semi-annual financial statements that demonstrate compliance provided there is no default under the Security Agreement that is continuing.

Additional Mortgage. (a) K-Sea OLP agrees to and shall execute the Additional Mortgage and the Additional Assignment of Insurance in favor of the Secretary as collateral to secure the obligations of the Partnerships hereunder and under the other Documents. The Partnerships and the Secretary agree that: (1) The Additional Mortgage, as originally executed, shall cover the Additional Vessels with an aggregate Orderly Liquidation Value equal to or exceeding Ten Million Dollars ($10,000,000), which shall be maintained for the duration of the Additional Mortgage specified below. If the Orderly Liquidation Value of the Additional Vessels drops below $10,000,000, then upon receiving written notice from the Secretary the Partnerships Partnership shall promptly add additional collateral in favor of the Secretary such that the aggregate of the Additional Vessels and such new collateral equals at least $10,000,000; (2) The Additional Mortgage may be supplemented from time to time, and the Secretary shall provide its consent as mortgagee when requested, to replace, remove or otherwise change any Additional Vessel covered under the Additional Mortgage with a different vessel or vessels that satisfy the requirements of Additional Vessel as set forth in the definition of Additional Vessel in Attachment A herein, PROVIDEDprovided, THATthat, the aggregate Orderly Liquidation Value of the Additional Vessels under the Additional Mortgage, as supplemented, equals or exceeds Ten Million Dollars ($10,000,000); (3) No hire, freights, or earnings or any other revenue relating to any Additional additional Vessel shall be assigned or pledged by the Partnerships to any entity; and (b) The Additional Mortgage shall terminate on December 31, 2008 if, at such time, (i) there is no default under the Security Agreement that is continuing and (ii) the Consolidated Group meets the requirements with respect to Fixed Charge Coverage Ratio, Net Worth and Long Term Debt as set forth in Section 8(b)(i), (ii) and (iii) herein based on the Consolidated Group's financial statements dated December 31, 2007, June 30, 2008 and December 31, 2008. If the Consolidated Group is not in compliance with the requirements with respect to Fixed Charge Coverage Ratio, Net Worth and Long Term Debt as set forth in Section 8(b)(i), (ii) and (iii) herein on December 31, 2008, the Additional Mortgage shall terminate upon the receipt of four consecutive semi-annual financial statements that demonstrate compliance provided there is no default under the Security Agreement that is continuing.