CONFORMED COPY
PRIVATE & CONFIDENTIAL


                     DATED 8th December 1998




                       GLOBAL MARINE INC.
                          as Guarantor

                               and

                      BMBF (NO.12) LIMITED
                            as Lessor






                                                                

                             DEED OF
                     GUARANTEE AND INDEMNITY
                           relating to
        Global Marine International Drilling Corporation
      and a Glomar Hull 456 class Deepwater Drillship with
               Harland and Wolff hull number 1740
                 Schedule Number: 52/5050 5371-3
                                                                





                                
                            LIST OF CONTENTS

Clause  Title                                                Page Number

1.      DEFINITIONS AND INTERPRETATION                            1
1.1     Definitions                                               1
1.2     Interpretation                                            5

2.      GUARANTEE AND INDEMNITY                                   6
3.      DEMANDS AND CERTIFICATES                                  7
4.      TIME AND INDULGENCE                                       8
5.      CONTINUING SECURITY                                       9
6.      NO COMPETITION                                            9
7.      GUARANTOR'S OBLIGATIONS                                  10
8.      REPRESENTATIONS AND WARRANTIES                           10
9.      COVENANTS                                                13
10.     PAYMENTS AND TAXES                                       17
10.1    Payments                                                 17

11.     ADDITIONAL SECURITY                                      19
12.     ACKNOWLEDGEMENT AND DECLARATION                          19
13.     ASSIGNMENT                                               20
13.1    Assignment by Lessor                                     20
13.2    Assignment by Guarantor                                  21

14.     COSTS AND EXPENSES                                       21
15.     MISCELLANEOUS                                            21
15.1    Delay in Enforcement, Waivers etc.                       21
15.2    Variation                                                21
15.3    Invalidity                                               21
15.4    Notices                                                  22
15.5    Applicable Law                                           22
15.6    Counterparts                                             22
15.7    Further Assurances                                       23
15.8    Entire Agreement                                         23

16.     SUBMISSION TO JURISDICTION                               23
17.     JUDGMENT CURRENCY                                        24
18.     NATURE OF DOCUMENT                                       24



THIS GUARANTEE AND INDEMNITY dated  8th December 1998 is made

BETWEEN:
      
      (1)    GLOBAL MARINE INC., a company incorporated under the laws of
      the State of Delaware in the United States of America and
      having its principal place of business at 777 North Eldridge
      Parkway, Houston, Texas 77079, United States of America (the
      "GUARANTOR"); and
      
      (2)    BMBF (No.12) limited, a company incorporated under the laws
      of England and Wales with company registration number
      2512609 whose registered office is at Churchill Plaza,
      Churchill Way, Basingstoke, Hampshire RG21 7GP, England
      (the "LESSOR").
      
      WHEREAS:
      
      (A)    Pursuant to the Novation Agreement and the Head Lease, the
      Lessor has agreed, inter alia, to purchase the Vessel from
      the Builder and lease the same to the Lessee subject to the
      terms and conditions therein contained.
      
      (B)    The Guarantor desires the Lessor to purchase the Vessel from
      the Builder, to lease the same to the Lessee, for the
      purposes of the Lessee sub-chartering the same to the Sub-
      Lessee and the Sub-Lessee entering into the Exxon Contract
      with the Exxon Party, and to enter into the Lease Documents
      to which the Lessor is or is to be a party.
      
      (C)    The Lessee and the other Primary Obligors are wholly owned
      Subsidiaries (US) of the Guarantor.
      
      (D)    It is a condition precedent to the obligations of the Lessor
      under the Head Lease that the Guarantor executes and
      delivers this Guarantee and Indemnity to the Lessor.
      
      NOW IT IS HEREBY AGREED AS FOLLOWS:
      
      1.     DEFINITIONS AND INTERPRETATION
      
      1.1    Definitions
      
             Save as otherwise expressly provided herein, words and
      expressions used in this Guarantee and Indemnity shall have
      the meanings, if any, respectively attributed thereto in the
      Head Lease.  In this Guarantee and Indemnity (including the
      Recitals) the following words and expressions shall have the
      meanings respectively attributed to them below:
      
      "ATTRIBUTABLE INDEBTEDNESS" when used with respect to any
      Sale/Leaseback Transaction, means, as at the time of
      determination, the present value (discounted at the rate set
      forth or implicit in the terms of the lease included in such
      transaction) of the total obligations of the lessee for
      rental payments (other than amounts required to be paid on
      account of taxes, maintenance, repairs, insurance,
      assessments, utilities, operating and labour costs and other
      items which do not constitute payments for property rights)
      during the remaining term of the lease included in such
      Sale/Leaseback Transaction (including any period for which
      such lease has been extended).  In the case of any lease
      which is terminable by the lessee upon the payment of a
      penalty, such net amount shall be the lesser of the net
      amount determined assuming termination upon the first date
      such lease may be terminated (in which case the net amount
      shall also include the amount of the penalty, but no rent
      shall be considered as required to be paid under such lease
      subsequent to the first date upon which it may be so
      terminated) or the net amount determined assuming no such
      termination;
      
      "ASSET" means every kind of property, asset, interest or
      right, including but not limited to any future or contingent
      rights to any revenues or other payment which would, in
      accordance with GAAP consistently applied, be classified as
      assets on that day;
      
      "BOARD OF DIRECTORS" means the Board of Directors of the
      Guarantor or any committee thereof duly authorised, with
      respect to any particular matter, to act by or on behalf of
      the Board of Directors of the Guarantor;
             
      "BOARD RESOLUTION" means a copy of a resolution certified by
      the Secretary or an Assistant Secretary of the Guarantor to
      have been duly adopted by the Board of Directors and to be
      in full force and effect on the date of such certification,
      and delivered to the Lessor;
      
      "CAPITALISED LEASE OBLIGATION" of any person means any
      obligation of such person to pay rent or other amounts under
      a lease of property, real or personal, that is required to
      be capitalised for financial reporting purposes in
      accordance with GAAP; and the amount of such obligation
      shall be the capitalised amount thereof determined in
      accordance with GAAP;
      
      "CONSOLIDATED NET TANGIBLE ASSETS" means the total amount of
      assets (less applicable reserves and other properly
      deductible items) after deducting (i) all current
      liabilities (excluding the amount of those which are by
      their terms extendible or renewable at the option of the
      obligor to a date more than twelve (12) months after the
      date as of which the amount is being determined and current
      maturities of long-term debt) and (ii) all goodwill,
      tradenames, trademarks, patents, unamortised debt discount
      and expense and other like intangible assets, all as set
      forth on the most recent quarterly balance sheet of the
      Guarantor and its consolidated subsidiaries and determined
      in accordance with GAAP;
      
      "EMCUMBRANCE" means any mortgage, pledge, lien, charge
      (whether fixed or floating), assignment, hypothecation,
      security interest, title retention, preferential right or
      trust arrangement and any other security agreement or
      arrangement;
      
      "FUNDED INDEBTEDNESS" means all Indebtedness (including
      Indebtedness incurred under any revolving credit, letter of
      credit or working capital facility) that matures by its
      terms, or that is renewable at the option of any obligor
      thereon to a date more than one year after the date on which
      such Indebtedness is originally incurred;
      
      "GAAP" means generally accepted accounting principles in the
      United States of America set forth in the opinions and
      pronouncements of the Accounting Principles Board of the
      American Institute of Certified Public Accountants and
      statements and pronouncements of the Financial Accounting
      Standards Board or in such other statements by such other
      entity as may be approved by a significant segment of the
      accounting profession of the United States of America, as in
      effect from time to time;
      
             "GROUP" means the Guarantor and its Subsidiaries (US) from
             time to time; 
      
      "GUARANTEED AGREEMENTS" means each of the Lease Documents to
      which the Lessor and the Lessee and/or any other Primary
      Obligor is a party;
      
      "GUARANTEED OBLIGATIONS" means any and all monies,
      liabilities and obligations (whether actual or contingent,
      whether now existing or hereafter arising, whether arising
      in respect of or attributable to the period prior to the
      date of this Guarantee and Indemnity or to any time
      hereafter whether or not for the payment of money, and
      including, without limitation, any obligation or liability
      to pay damages and including any interest which, but for the
      application of bankruptcy or insolvency laws, would have
      accrued on the amounts in question) which are now or which
      may at any time and from time to time hereafter be due,
      owing, payable or incurred or be expressed to be due, owing,
      payable or incurred from or by the Lessee and/or any other
      Primary Obligor to the Lessor under or in connection with
      the Guaranteed Agreements and references to "GUARANTEED
      OBLIGATIONS" include references to any part thereof;
      
      "HEAD LEASE" means the lease in respect of the Vessel
      entered or to be entered into between the Lessor and the
      Lessee;
      
      "INDEBTEDNESS" of any person means, without duplication, (i)
      all indebtedness of such person for borrowed money (whether
      or not the recourse of the lender is to the whole of the
      assets of such person or only to a portion thereof), (ii)
      all obligations of such person evidenced by bonds,
      debentures, notes or other similar instruments, (iii) all
      obligations of such person in respect of letters of credit
      or other similar instruments (or reimbursement obligations
      with respect thereto), other than standby letters of credit,
      performance bonds and other obligations issued by or for the
      account of such person in the ordinary course of business,
      to the extent not drawn or, to the extent drawn, if such
      drawing is reimbursed not later than the third Business Day
      following demand for reimbursement, (iv) all obligations of
      such person to pay the deferred and unpaid purchase price of
      property or services, except trade payables and accrued
      expenses incurred in the ordinary course of business, (v)
      all Capitalised Lease Obligations of such person, (vi) all
      Indebtedness of others secured by a Lien on any asset of
      such person, whether or not such Indebtedness is assumed by
      such person (provided that if the obligations so secured
      have not been assumed in full by such person or are not
      otherwise such person's legal liability in full, then such
      obligations shall be deemed to be in an amount equal to the
      greater of (a) the lesser of (1) the full amount of such
      obligations and (2) the fair market value of such assets, as
      determined in good faith by the board of directors of such
      person, which determination shall be evidenced by a board
      resolution, and (b) the amount of obligations as have been
      assumed by such person or  which are otherwise such person's
      legal liability), and (vii) all Indebtedness of others
      (other than endorsements in the ordinary course of business)
      guaranteed by such person to the extent of such guarantee;
      
      "JOINT VENTURE" means (1) with respect to properties located
      in the United States of America, any partnership,
      corporation or other entity, in which up to and including 50
      percent. (50%) of the partnership interests, outstanding
      voting stock or other equity interests is owned, directly or
      indirectly, by the Guarantor and/or one or more Subsidiaries
      (US), and (2) with respect to properties located outside the
      United States of America, any partnership, corporation or
      other entity, in which up to and including 60 percent. (60%)
      of the partnership interests, outstanding voting stock or
      other equity interests is owned, directly or indirectly, by
      the Guarantor and/or one or more Subsidiaries (US).  A Joint
      Venture shall not be a Subsidiary (US);
      
      "LESSEE" means Global Marine International Drilling
      Corporation, a company incorporated under the laws of the
      Bahamas and having its registered office at c/o McKinney,
      Bancroft & Hughes, Mareva House, 4 George Street, PO Box No.
      3937, Nassau, Bahamas; 
      
      "LIABILITY" means a liability, loss, charge, claim,
      proceeding, damage, judgment, enforcement, penalty, fine,
      fee, cost and expense of whatsoever nature; 
      
      "LIEN" means any mortgage, pledge, lien, encumbrance, charge
      or security interest.  For purposes of this Guarantee and
      Indemnity, the Guarantor or any Subsidiary (US) of the
      Guarantor shall be deemed to own subject to a Lien any asset
      which it has acquired or holds subject to the interest of a
      vendor or lessor under any conditional sale agreement,
      Capitalised Lease Obligation or other title retention
      agreement relating to such asset;
      
      "PARI PASSU INDEBTEDNESS" means any Indebtedness of the
      Guarantor, whether outstanding on the date of this Guarantee
      and Indemnity or thereafter created, incurred or assumed,
      unless, in the case of any particular Indebtedness, the
      instrument creating or evidencing the same or pursuant to
      which the same is outstanding expressly provides that such
      Indebtedness shall be subordinated in right of payment to
      the obligations of the Guarantor under this Guarantee and
      Indemnity;
      
      "PERMITTED LIENS" shall mean (i) Liens existing on the date
      of this Guarantee and Indemnity, (ii) Liens on property or
      assets of, or any shares of stock of, or other equity
      interests in, or indebtedness of, any person existing at the
      time such person becomes a Subsidiary (US) of the Guarantor
      or at the time such person is merged into or consolidated
      with the Guarantor or any of its Subsidiaries (US) or at the
      time of a sale, lease or other disposition of the properties
      of a person (or a division thereof) as an entirety or
      substantially as an entirety to the Guarantor or a
      Subsidiary (US); (iii) Liens in favour of the Guarantor or
      any of its Subsidiaries (US); (iv) Liens in favour of
      governmental bodies to secure progress or advance payments;
      (v) Liens securing industrial revenue or pollution control
      bonds; (vi) Liens on assets existing at the time of
      acquisition thereof, securing all or any portion of the cost
      of acquiring, constructing, improving, developing or
      expanding such assets or securing Indebtedness incurred
      prior to, at the time of, or within twenty-four (24) months
      after, the later of the acquisition, the completion of
      construction, improvement, development or expansion or the
      commencement of commercial operation of such assets, for the
      purpose of (a) financing all or any part of the purchase
      price of such assets or (b) financing all or any part of the
      cost of construction, improvement, development or expansion
      of any such assets; (vii) statutory liens or landlords',
      carriers', warehouseman's, mechanics', suppliers',
      materialmen's, repairmen's or other like Liens arising in
      the ordinary course of business and with respect to amounts
      not yet delinquent or being contested in good faith by
      appropriate proceedings; (viii) Liens on current assets of
      the Guarantor or any Subsidiary (US) securing Indebtedness
      of the Guarantor or such Subsidiary (US), respectively (ix)
      Liens on the stock, partnership or other equity interest of
      the Guarantor or any Subsidiary (US) in any Joint Venture or
      any Subsidiary (US) that owns an equity interest in such
      Joint Venture to secure Indebtedness, provided the amount of
      such Indebtedness is contributed and/or advanced solely to
      such Joint Venture; and (x) any extensions, substitutions,
      replacements or renewals in whole or in part of a Lien
      enumerated in clauses (i) through (ix) above;
      
      "PRINCIPAL PROPERTY" means any drilling rig or drillship, or
      integral portion thereof, owned or leased by the Guarantor
      or any Subsidiary (US) and used for drilling offshore oil
      and gas wells, which, in the opinion of the board of
      directors, is of material importance to the business of the
      Guarantor and its Subsidiaries (US) taken as a whole, but no
      such drilling rig or drillship, or portion hereof, shall be
      deemed of material importance if its net book value (after
      deducting accumulated depreciation) is less than two
      percent. (2%) of Consolidated Net Tangible Assets;
      
      "PRIMARY OBLIGOR" means each member of the Guarantor's Group
      (other than the Guarantor) which is a party to any Lease
      Document, including in any event the Lessee, the Sub-Lessee
      and, prior to the Delivery Date, the Option Party;
      
      "SALE/LEASEBACK TRANSACTION" means any arrangement with any
      person pursuant to which the Guarantor or any Subsidiary
      (US) leases any Principal Property that has been or is to be
      sold or transferred by the Guarantor or the Subsidiary (US)
      to such person, other than (1) temporary leases for the
      term, including renewals at the option of the lessee, of not
      more than five years, (2) leases between the Guarantor and
      a Subsidiary (US) or between Subsidiaries (US), (3) leases
      of Principal Property executed by the time of, or within 12
      months after the latest of, the acquisition, the completion
      of construction or improvement, or the commencement of
      commercial operation of the Principal Property, and (4)
      arrangements pursuant to any provision of law with an effect
      similar to the former Section 168(f)(8) of the Internal
      Revenue Code of 1954;
      
      "VESSEL" means the Glomar class 456 ultra-deepwater
      drillship to be constructed by the Shipbuilder pursuant to
      the Shipbuilding Contract under hull number 1740 and to be
      registered on or prior to the Delivery Date in the name of
      the Lessor under the Panamanian flag under the name "GLOMAR
      IRISH SEA I" (further details of which are set out in the
      Head Lease); 
      
      "VESSEL SYSTEMS" shall have the meaning given thereto in
      Clause 8.1.15; and
             
      "YEAR 2000 ISSUE" means the failure of computer software,
      hardware and firmware systems and equipment containing
      embedded computer chips to properly receive, transmit,
      process, manipulate, store, retrieve, re-transmit or in any
      other way utilise data and information due to the occurrence
      of the year 2000 or the inclusion of dates on or after 1
      January, 2000.
             
      1.2    INTERPRETATION
      
             (A)    In this Guarantee and Indemnity references to:
             
                    (i)    clauses, paragraphs, sub-paragraphs, or the
                    schedule are, unless otherwise specified,
                    references to clauses, paragraphs, sub-
                    paragraphs of, and the schedule to, this
                    Guarantee and Indemnity as from time to time
                    amended in accordance with the provisions of
                    this Guarantee and Indemnity;

                    (ii)   any statute or other legislative provisions
                    shall, unless otherwise specified, be read to
                    include any statutory or legislative
                    modification or re-enactment thereof, or
                    substitution therefor;

                    (iii)  this Guarantee and Indemnity or any other
                    agreement or instrument shall include this
                    Guarantee and Indemnity or such other
                    agreement or instrument as it may from time to
                    time be amended, novated, supplemented or
                    substituted with the agreement of the parties
                    hereto or thereto as the case may be;
                    
                    (iv)   "PERSON" means any individual, corporation,
                    partnership, limited liability company, joint
                    venture, incorporated or unincorporated
                    association, joint stock company, trust,
                    unincorporated organisation or government or
                    other agency or political subdivision thereof
                    or other entity of any kind;

                    (v)    "ASSIGNEE" of a person shall include any
                    person who has assumed all or some of the
                    rights and/or obligations of the relevant
                    person, whether by assignment, novation or
                    otherwise; 

                    (vi)   reference to any person shall include its
                    successors (whether of the same name or
                    another name) and permitted assignees;
                    
                    (vii)  words denoting the singular number shall
                    include the plural and vice versa;
                    
                    (viii) the words "OTHER" and "OTHERWISE" shall not be
                    construed ejusdem generis with any foregoing
                    words where a wider construction is possible;
                    
                    (ix)   the "WINDING-UP" of a person also includes the
                    amalgamation, reconstruction, reorganisation,
                    administration, dissolution, liquidation,
                    merger or consolidation of that person, and
                    any equivalent or analogous procedure under
                    the law of any jurisdiction in which that
                    person is incorporated, domiciled or resident
                    or carries on business or has assets; and
                    
                    (x)    the words "INCLUDING" and "IN PARTICULAR"
                    shall be construed as being by way of
                    illustration or emphasis only and shall not be
                    construed as, nor shall they take effect as,
                    limiting the generality of the foregoing
                    words.
                    
             (B)    Clause and other headings are for ease of reference
             only and shall not affect the interpretation of this
             Guarantee and Indemnity.


2.     GUARANTEE AND INDEMNITY

      2.1    In consideration of the Lessor, inter alia, entering, and
      agreeing to enter, into the Head Lease and the other Lease
      Documents to which it is or is to be a party, the Guarantor:
             
             2.1.1  as primary obligor and not as surety only, hereby
             unconditionally and irrevocably guarantees to the
             Lessor the due and punctual observance and
             performance by the Lessee and/or any other Primary
             Obligor of each and every one of the Guaranteed
             Obligations;
             
             2.1.2  hereby unconditionally and irrevocably covenants with
             and undertakes with the Lessor that in the event of
             a default by the Lessee and/or any other Primary
             Obligor in the observance or performance for whatever
             reason of any of the Guaranteed Obligations, as and
             when the same shall be expressed to be due to be
             observed or performed, the Guarantor shall forthwith
             on demand by the Lessor perform such Guaranteed
             Obligation or cause such Guaranteed Obligation to be
             performed, punctually as if such Guaranteed
             Obligation were performed by the Lessee and/or any
             other Primary Obligor; and
             
             2.1.3  hereby irrevocably and unconditionally undertakes,
             covenants and agrees with the Lessor as a primary
             obligation to indemnify the Lessor and keep the
             Lessor indemnified on demand and on a full indemnity
             basis for and against any and all Liabilities
             incurred or sustained by the Lessor in relation to
             and arising out of the failure of the Lessee and/or
             any other Primary Obligor duly and punctually to
             perform the Guaranteed Obligations.
             
      2.2    As a separate and alternative stipulation in addition to its
      liabilities in Clause 2.1, the Guarantor hereby
      unconditionally and irrevocably agrees with the Lessor that
      any of the Guaranteed Obligations which is expressed to be
      performed by the Lessee and/or any other Primary Obligor but
      which may not be recoverable from the Guarantor on the
      footing of a guarantee (whether by reason of the dissolution
      of the Lessee and/or any other Primary Obligor or any
      reconstruction or amalgamation in which or as a consequence
      of which the Lessee and/or any other Primary Obligor loses
      its respective separate corporate identity or any other fact
      or circumstance whatsoever and whether or not known or
      becoming known to the Lessor) shall nevertheless be
      recoverable from the Guarantor as if it were the principal
      debtor.
             
      2.3    In addition to its liabilities under Clauses 2.1 and 2.2
      above the Guarantor shall pay or cause to be paid to the
      Lessor on demand interest at the Default Rate (both before
      and after judgment) accruing on a day to day basis, and on
      the basis of a 365 day year (or a 360 day year when the
      amount in respect of which Default Interest is payable under
      this Clause 2.3 is denominated in a currency where it is
      customary for banks or financial institutions to calculate
      interest on such a basis), on each amount (or any part
      thereof) for the time being due to the Lessor under this
      Guarantee and Indemnity and unpaid from the date of demand
      on the Guarantor for payment until payment is made (but
      excluding the day on which value for any payment made is
      received by the Lessor).

      2.4    the Guarantor hereby agrees that for the purposes of this
      Guarantee and Indemnity, service by the Lessor on the Lessee
      of a Termination Notice shall constitute a valid and
      effective service of such notice and the Lessee shall be
      conclusively deemed to have become liable to make the
      payments expressed in Clause 21.5 of the Head Lease to be
      payable by the Lessee to the Lessor upon service of such
      notice, notwithstanding that, as between the Lessee and the
      Lessor, the Lessor is, by virtue of any laws of England and
      Wales or any other applicable jurisdiction, relating to
      bankruptcy, insolvency or administration or any similar
      laws, prohibited from serving such notice, repossessing the
      Vessel or commencing or continuing any proceedings or other
      legal process in England and Wales or such other
      jurisdiction against the Lessee would not be effective
      according to its terms.

3.     DEMANDS AND CERTIFICATES

      3.1    In order to make any demand under this Guarantee and
      Indemnity the Lessor shall serve upon the Guarantor a notice
      in writing.

      3.2    Any certificate from any director, officer or authorised
      person of the Lessor or any agent of the Lessor contained in
      any demand, notice or other communication given or made by
      the Lessor under this Guarantee and Indemnity in relation to
      the amount of the Guarantor's liability in relation to the
      Guaranteed Obligations or any other amount payable by the
      Guarantor under this Guarantee and Indemnity shall be prima
      facie evidence that the facts stated in such certificate are
      true and correct.
      
      3.3    The Guarantor acknowledges and agrees with the Lessor that,
      whenever the Lessor cannot reasonably ascertain with
      certainty the amount of any liability of the Lessee and/or
      any other Primary Obligor to the Lessor under any of the
      Guaranteed Agreements, the Lessor may make demand on the
      Lessee and/or any other Primary Obligor on the basis of a
      provisional estimate thereof by the Lessor, and if any such
      demand is not satisfied in full the Lessor may make demand
      on the Guarantor under this Guarantee and Indemnity in
      accordance with and subject to Clause 2 for the sum so
      demanded from the Lessee and/or any other Primary Obligor. 
      Without prejudice to Clauses 2 and 3.2, the Guarantor agrees
      that no such demand on the Guarantor shall be vitiated or
      invalidated if it subsequently transpires that the amount
      demanded from the Lessee, any other Primary Obligor or the
      Guarantor was less than or greater than the amount which was
      properly due.  If it subsequently transpires that an amount
      (including interest) paid by the Guarantor was greater than
      the amount which was properly due from the Guarantor, the
      Lessor shall refund the excess to the Guarantor together
      with an amount equal to interest at Base Rate on the excess
      from the date paid to the date refunded.
      
      3.4    Without prejudice to Clauses 3.1, 3.2 and 3.3 the Lessor may
      at any time and from time to time issue further or corrected
      demands on the Guarantor in respect of any Guaranteed
      Obligation.


4.     TIME AND INDULGENCE

      4.1    The Lessor shall be at liberty at all times and from time to
      time, whether before or after any demand for payment under
      this Guarantee and Indemnity and without discharging or in
      any way affecting the Guarantor's liability hereunder, to do
      all or any of the following:

             4.1.1  terminate, amend or novate or agree to the
             termination, amendment or novation (in accordance
             with the terms of the Guaranteed Agreements) any of
             the Guaranteed Agreements in any manner whatsoever;

             4.1.2  grant to the Lessee, any other Primary Obligor or to
             any other person any time or indulgence;
             
             4.1.3  terminate or cancel the Shipbuilding Contract and/or
             the purchase of the Vessel thereunder;

             4.1.4  deal with, exchange, renew, vary, release, modify or
             abstain from perfecting or enforcing any securities,
             guarantees or rights which the Lessor may now or
             hereafter have from or against the Lessee, any other
             Primary Obligor or any other person in respect of the
             respective obligations of the Lessee, any other
             Primary Obligor or such other person under or in
             respect of the Guaranteed Agreements or the
             transactions contemplated thereby;

             4.1.5  compound with, discharge or vary the liability of the
             Lessee, any other Primary Obligor or any other person
             or guarantor to the Lessee and/or any other Primary
             Obligor or concur in, accept or vary any compromise,
             arrangement or settlement with the Lessee, any other
             Primary Obligor or any other person or guarantor or
             concur in or vary any deed of arrangement or deed of
             assignment for the benefit of creditors of any such
             person;

             4.1.6  omit to prove or fail to maintain any right of proof
             for or to claim or enforce payment of any dividend or
             composition; and

             4.1.7  take or omit to take any security from the Lessee,
             any other Primary Obligor or any other person or
             guarantor in respect of the obligations of the Lessee
             and/or any other Primary Obligor under or in respect
             of the Guaranteed Agreements or the transactions
             contemplated thereby whether contemporaneously with
             this Guarantee and Indemnity or otherwise.


5.     CONTINUING SECURITY

      5.1    This Guarantee and Indemnity shall be a continuing security
      and accordingly:

             5.1.1  shall be binding on the Guarantor and its successors
             and assigns;

             5.1.2  shall not be discharged by any partial payment by the
             Lessee, any other Primary Obligor or any other person
             under or in respect of any of the Guaranteed
             Agreements;

             5.1.3  shall extend to cover the balance due at any time
             from the Lessee and/or any other Primary Obligor to
             the Lessor under or in respect of the Guaranteed
             Agreements or the transactions contemplated thereby;

             5.1.4  shall be in addition to and not in substitution for
             or derogation of any other security which the Lessor
             may at any time hold in respect of the obligations of
             the Lessee and/or any other Primary Obligor under or
             in respect of the Guaranteed Agreements or the
             transactions contemplated thereby; 

             5.1.5  except to the extent that the Lessor expressly waives
             the Guarantor's obligations under this Guarantee and
             Indemnity, shall not be discharged or in any way
             affected by any action taken or not taken by the
             Lessor; and
             
             5.1.6  shall not be discharged or in any way affected by any
             merger with any other person or persons or
             restructuring of any nature whatsoever of, or any
             change of name by, the Lessee and/or any other
             Primary Obligor, or the disposal of any interest in
             the Lessee and/or any other Primary Obligor (whether
             or not the same is consented to, or otherwise
             approved by, the Lessor).

6.     NO COMPETITION

      6.1    From the date or dates upon which any demand is properly
      made against the Guarantor under this Guarantee and
      Indemnity until such time as the Lessor has received, and is
      entitled to retain, payment of the Guaranteed Obligations in
      full, the Guarantor shall not:
      
             6.1.1  claim any set-off or counterclaim against the Lessee
             and/or any other Primary Obligor in respect of any
             payment by the Guarantor hereunder or in respect of
             any outstanding actual or contingent liability
             between the Guarantor and the Lessee and/or any other
             Primary Obligor; or
      
             6.1.2  make or enforce any claim or right (including a right
             of subrogation or contribution) against the Lessee
             and/or any other Primary Obligor or prove in
             competition with the Lessor in the event of the
             liquidation of the Lessee and/or any other Primary
             Obligor in respect of any payment by the Guarantor
             hereunder or in respect of any outstanding actual or
             contingent liability between the Guarantor and the
             Lessee and/or any other Primary Obligor; or
      
             6.1.3  in competition with the Lessor claim the benefit of
             any security or guarantee now or hereafter held by
             the Lessor for any money or liabilities due or
             incurred by the Lessee and/or any other Primary
             Obligor to the Lessor or any share therein.


7.     GUARANTOR'S OBLIGATIONS

      7.1    The Guarantor's obligations under this Guarantee and
      Indemnity are those of primary obligor and exist
      irrespective of any total or partial invalidity, illegality
      or unenforceability of any of the Guaranteed Agreements. 
      
      7.2    The Lessor shall not be obliged before making demand under
      or taking steps to enforce this Guarantee and Indemnity:

             7.2.1  to take action or obtain judgment against the Lessee,
             any other Primary Obligor or any other person in any
             court or tribunal; or

             7.2.2  to make or file any claim in a bankruptcy or
             liquidation of the Lessee, any other Primary Obligor
             or any other person; or 
             
             7.2.3  to exercise diligence against the Lessee, any other
             Primary Obligor or any other person under any of the
             Guaranteed Agreements or the transactions
             contemplated thereby.

      7.3    The Guarantor waives and agrees not to enforce or claim the
      benefit of any and all rights it has or may from time to
      time have as surety under any applicable law which is or may
      be inconsistent with any of the provisions of this Guarantee
      and Indemnity.


8.     REPRESENTATIONS AND WARRANTIES

      8.1    The Guarantor acknowledges that the Lessor has entered into
      the Lease Documents in full reliance on representations and
      warranties by the Guarantor in the terms set out in this
      Clause 8 and the Guarantor now represents and warrants to
      the Lessor that the following statements are at the date
      hereof true and accurate, namely that:

             8.1.1  the Guarantor is a company duly incorporated and
             validly existing under the laws of the State of
             Delaware in the United States of America and has the
             corporate power and authority to own its assets and
             carry on its business as it is being presently
             conducted and to enter into and perform its
             obligations under this Guarantee and Indemnity and to
             consummate the transactions contemplated hereby;

             8.1.2  the execution, delivery and performance by the
             Guarantor of this Guarantee and Indemnity and the
             consummation of the transactions contemplated hereby
             have been duly authorised by all necessary or
             appropriate corporate action on the part of the
             Guarantor, do not require any shareholder approval,
             or  approval or consent of any trustee or holders of
             any indebtedness or obligations of the Guarantor
             except such as have been duly obtained and are in
             full force and effect, and do not contravene or
             constitute a default under (aa) any law, governmental
             rule, regulation or decree, directive, convention,
             treaty, judgment, injunction or any official or
             judicial order binding on the Guarantor or any of its
             assets, (bb) its constitutional documents or (cc) any
             agreement consent or instruments to which it is a
             party or is binding upon it or any of its assets nor
             result in the creation or imposition of any Lien on
             any of its assets pursuant to the provisions of any
             such agreement, consent or instrument;

             8.1.3  this Guarantee and Indemnity constitutes, or when
             executed and delivered will constitute, the legal,
             valid and binding obligations of the Guarantor
             enforceable in accordance with its terms subject to
             general principles of equity and the law affecting
             creditors' rights generally;
             
             8.1.4  no authorisation, approval, consent, licence,
             exemption, registration, recording, filing or
             notarisation and no payment of any duty or tax and no
             other action whatsoever which has not been duly and
             unconditionally obtained, made or taken is necessary
             or desirable to ensure the validity, enforceability
             or priority of the liabilities and obligations of the
             Guarantor or the rights of the Lessor under this
             Guarantee and Indemnity;
      
             8.1.5  no event has occurred which constitutes, or which
             with the giving of notice and/or the lapse of time
             and/or a relevant determination would constitute a
             contravention of, or a default under, any agreement
             by which the Guarantor, its business or any of its
             assets is bound or affected, being a contravention or
             default which would be likely to either have a
             material adverse effect on the business, assets or
             financial or trading condition of the Guarantor or
             materially and adversely affect its ability to
             observe or perform its obligations under this
             Guarantee and Indemnity;
      
             8.1.6  no litigation, arbitration or administrative
             proceedings or claim which would be likely to, by
             itself or together with any other such proceedings or
             claims, either have a material adverse effect on its
             business, assets or financial or trading condition or
             materially and adversely affect its ability to
             observe or perform its obligations under this
             Guarantee and Indemnity is presently in progress or,
             to the best of the knowledge, information and belief
             of the Guarantor, pending or threatened against the
             Guarantor, its business or any of its assets;
      
             8.1.7  No Termination Event has occurred and is continuing;
             
             8.1.8  the Guarantor has not taken any corporate action nor,
             to the best of its knowledge and belief, have any
             other steps been taken or legal proceedings been
             started or threatened against it for its winding up,
             dissolution, administration or re-organisation or for
             the appointment of a receiver, administrator,
             administrative receiver, trustee or similar officer
             of it or of any or all of its assets or revenues;
             
             8.1.9  under applicable laws of the State of Delaware and
             the federal laws of the United States of America in
             force at the date hereof the Guarantor is not
             required to deduct any Taxes from any payments that
             it may be required to make under this Guarantee and
             Indemnity;
             
             8.1.10 the Guarantor is conducting its business in all
             material respects in compliance with all applicable
             laws, regulations and government directives and the
             Guarantor has obtained all material licences,
             permissions, authorisations and consents necessary
             for the conduct of its business and to the best of
             its knowledge and belief after due and proper enquiry
             all such licences, permissions, authorisations and
             consents are in full force and effect;
             
             8.1.11 the audited consolidated accounts of the Guarantor
             for the period ending 31st December 1997 have been
             prepared in accordance with generally accepted
             accounting principles and practices in the United
             States of America consistently applied and fairly
             represent the financial condition of the Group at
             that date and the results of their operations for the
             accounting period ended on that date, and there has
             been no material adverse change in the consolidated
             financial condition of the Group since that date;
             
             8.1.12 there have been no significant losses not disclosed
             either in the accounts referred to in Clause 8.1.11
             or otherwise disclosed to the Lessor in writing; 
             
             8.1.13 to the best of the knowledge, information and belief
             of the Guarantor, all information furnished by the
             Guarantor to the Lessor relating to the transactions
             contemplated by the Guaranteed Agreements is true and
             accurate in all material respects and there are no
             omissions of material facts or misleading information
             contained in such information;
             
             8.1.14 to the best of the knowledge, information and belief
             of the Guarantor, neither the Guarantor nor any of
             its property or assets is entitled to immunity on the
             grounds of sovereignty or otherwise from any legal
             action, suit or proceeding, attachment or other legal
             process in any jurisdiction;
             
             8.1.15 the Lessee and the other Primary Obligors are wholly
             owned direct or indirect Subsidiaries (US) of the
             Guarantor;
             
             8.1.16 the Guarantor is reviewing the effect of the Year
             2000 Issue on the material computer software,
             hardware and firmware systems and equipment
             containing embedded microchips owned or operated by
             itself, the Lessee and the Sub-Lessee on board the
             Vessel (the "VESSEL SYSTEMS").  The costs of any
             reprogramming and testing required as a result of the
             Year 2000 Issue to permit the proper functioning of
             the Vessel Systems and the proper processing of data
             are not reasonably expected to result in a default by
             the Guarantor in respect of its obligations under
             this Guarantee and Indemnity or to have a materially
             adverse effect on the business, assets, operations,
             prospects or condition (financial or otherwise) of
             the Guarantor.
             
             8.1.17 each member of the Group has complied in all material
             respects with all Taxation laws in all jurisdictions
             in which it is subject to Taxation and has paid all
             Taxes due and payable by it and no claims are being
             asserted against any member of the Group with respect
             to Taxes which, if adversely determined, would be
             likely either to have a material adverse effect on
             the business or assets or financial condition of the
             Group as a whole or materially and adversely to
             affect the Guarantor's ability to observe and perform
             its obligations under this Guarantee and Indemnity;
             
             8.1.18 no stamp or registration duty or similar taxes or
             charges are payable in the States of Delaware or
             Texas or under the federal laws of the United States
             of America in respect of this Guarantee and Indemnity
             or any of the other Lease Documents; and
             
             8.1.19 subject to any qualifications contained in the
             Delaware legal opinions addressed to the Lessor (as
             referred to in Schedule 5 to the Head Lease) the
             choice of English law to govern this Guarantee and
             Indemnity is a valid choice of law and English law
             will accordingly be applied by the courts in the
             State of Delaware and the federal courts of the
             United States of America if this Guarantee and
             Indemnity or any claim hereunder comes under their
             jurisdiction upon proof of the relevant provisions of
             English law.  The submission hereunder by the
             Guarantor to the jurisdiction of the courts of
             England and the appointment by the Guarantor of
             process agents in England to accept service of
             process in respect of the jurisdiction of such courts
             is valid and binding upon the Guarantor.
             
      8.2    The representations and warranties by the Guarantor
      contained in Clause 8.1 (other than Clauses 8.1.3, 8.1.4,
      8.1.9, 8.1.11, 8.1.15, 8.1.17 and 8.1.18) shall be deemed to
      be repeated on and as of each Instalment Date as if made
      with reference to the facts and circumstances existing at
      such date (but so that the representation and warranty in
      Clause 8.1.12 shall for this purpose refer to the then
      latest audited consolidated financial accounts of the
      Guarantor).
      
      8.3    The representations and warranties contained in this Clause
      8 and the rights of the Lessor in respect thereof shall
      survive the execution and delivery of this Guarantee and
      Indemnity.

9.     COVENANTS

      The Guarantor hereby covenants with the Lessor that, so long
      as it remains under any liability, actual or contingent,
      under this Guarantee and Indemnity:

             9.1    it will provide to the Lessor such financial and
             other information relating to the Group as is
             publicly available or as the Guarantor makes
             available to its creditors generally including,
             without limitation, copies of the quarterly and
             annual consolidated audited accounts of the Guarantor
             and the Group no later than 60 days after the end of
             the quarterly period or 180 days after the end of the
             annual period (as the case may be) to which they
             relate; 
             
             9.2    it will provide to the Lessor promptly, such further
             information in the possession or control of the
             Guarantor or of any of its Subsidiaries (US)
             regarding the financial condition and operations of
             the Guarantor or any of its Subsidiaries (US), as the
             Lessor may reasonably request;
             
             9.3    it will at all times, and from time to time, obtain,
             maintain, preserve and keep in full force and effect
             any permits, consents, licences and other
             authorisations governmental or otherwise as are from
             time to time necessary for the performance of its
             obligations under this Guarantee and Indemnity and
             comply in all material respects with any conditions
             attached thereto;
             
             9.4    except with the prior written consent of the Lessor,
             not take or accept any Lien (as defined in the Head
             Lease) from the Lessee, any other Primary Obligor or
             any other person in respect of the Guarantor's
             liability under this Guarantee and Indemnity PROVIDED
             HOWEVER THAT any such Lien (as defined in the Head
             Lease) taken with or without such consent shall be
             held by the Guarantor for the benefit of and on trust
             for the Lessor so long as the Guarantor remains under
             any actual or contingent liability under this
             Guarantee and Indemnity;
      
             9.5    forthwith notify the Lessor if the Guarantor becomes
             aware of the occurrence of (i) any Termination Event
             and (ii) any Guarantor Credit Event;
             
             9.6    it shall procure that the Lessee and the other
             Primary Obligors shall remain Subsidiaries (US) of
             the Guarantor;
             
             9.7    it shall take all commercially reasonable action to
             complete in all material respects by 31 September
             1999, the reprogramming and testing of all Vessel
             Systems needed as a result of the Year 2000 Issue to
             permit the proper functioning of the Vessel Systems. 
             At the request of the Lessor, the Guarantor shall
             provide to the Lessor reasonable assurance of its
             compliance with this Clause 9.7;
             
             9.8    its obligations hereunder do and will rank at least
             pari passu with all other present and future
             unsecured unsubordinated obligations of the Guarantor
             other than obligations preferred by laws applicable
             to corporations generally in the State of Delaware
             and the federal laws of the United States of America.
      
             9.9    Subject to Clause 9.10, the Guarantor shall do or
             cause to be done all things necessary to preserve and
             keep in full force and effect its corporate existence
             and the corporate, partnership and other existence of
             each of its Subsidiaries (us) and all rights (charter
             and statutory) and franchises of the Guarantor and
             its Subsidiaries (us), provided that the Guarantor
             shall not be required to preserve the corporate
             existence of any Subsidiary (US) of the Guarantor
             (excluding in all events the Lessee and, prior to the
             Delivery Date, the Option Party) or any such right or
             franchise if the Board of Directors shall determine
             that the preservation thereof is no longer desirable
             in the conduct of the business of the Guarantor and
             its Subsidiaries (US) taken as a whole and that the
             loss thereof would not have a material adverse effect
             on the business, prospects, assets or financial
             condition of the Guarantor and its Subsidiaries (US)
             taken as a whole and would not have any material
             adverse effect on the payment and performance of the
             obligations of the Guarantor under this Guarantee and
             Indemnity.
             
             9.10   The Guarantor shall not, in any transaction or series
             of transactions, consolidate with or merge into any
             person, or sell, lease, convey, transfer or otherwise
             dispose of all or substantially all of its assets to
             any person, unless:
                    
                    (1)    either (a) the Guarantor shall be the
                    continuing corporation or (b) the person (if
                    other than the Guarantor) formed by such
                    consolidation or into which the Guarantor is
                    merged, or to which such sale, lease,
                    conveyance, transfer or other disposition
                    shall be made (collectively, the "Successor"),
                    is organised and validly existing under the
                    laws of the United States of America, any
                    political subdivision thereof or any State
                    thereof or the District of Columbia, and
                    expressly assumes the performance of the
                    Guarantor's covenants and obligations under
                    this Guarantee and Indemnity;
                    
                    (2)    immediately after giving effect to such
                    transaction or series of transactions, no
                    Termination Event shall have occurred and be
                    continuing or would result therefrom; and
                    
                    (3)    the Guarantor delivers to the Lessor a
                    certificate certified by a duly authorised
                    officer of the Guarantor and a legal opinion
                    in form satisfactory to the Lessor, each
                    stating that the transaction complies with
                    this Guarantee and Indemnity.
             
             9.11   The Guarantor will not, and will procure that none of
             its Subsidiaries (US) will, either in a single
             transaction or in a series of transactions whether
             related or not and whether voluntarily or
             involuntarily, sell, transfer, or otherwise dispose
             of all or a substantial part of the Assets of the
             Guarantor or such Subsidiary (US) (in the case of a
             Subsidiary (US), being Assets which are substantial
             in relation to the Guarantor and its Subsidiaries
             (US) taken as a whole), provided that the Guarantor
             and any of its Subsidiaries (US) may, either in a
             single transaction or in a series of transactions
             whether related or not and whether voluntarily or
             involuntarily, sell, transfer, or otherwise dispose
             of all or a substantial part of the Assets of the
             Guarantor or such Subsidiary (US) (in the case of a
             Subsidiary (US), being assets which are substantial
             in relation to the Guarantor and its Subsidiaries
             (US) taken as a whole) if the Board of Directors
             shall determine that the retention of such Assets is
             no longer desirable in the conduct of the business of
             the Guarantor and its Subsidiaries (US) taken as a
             whole and that the disposal thereof would not have a
             material adverse effect on the business, prospects,
             assets or financial condition of the Guarantor and
             its Subsidiaries (US) taken as a whole and would not
             have any material adverse effect on the payment and
             performance of the obligations of the Guarantor under
             this Guarantee and Indemnity.
      
      9.12   Limitation on Liens
             
             The Guarantor shall not, and shall not permit any of
             its Subsidiaries (US) to, issue, assume or guarantee
             any Indebtedness for borrowed money secured by any
             Lien upon any Principal Property or any shares of
             stock or indebtedness of any Subsidiary (US) that
             owns or leases a Principal Property (whether such
             Principal Property, shares of stock or indebtedness
             are now owned or hereafter acquired) without making
             effective provision whereby the Guaranteed
             Obligations (together with, if the Guarantor shall so
             determine, any other Indebtedness or other obligation
             of the Guarantor) shall be secured equally and
             ratably with (or, at the option of the Guarantor,
             prior to) the Indebtedness so secured for so long as
             such Indebtedness is so secured.  The foregoing
             restrictions will not, however, apply to Indebtedness
             secured by Permitted Liens.
                    
             Notwithstanding the foregoing, the Guarantor and its
             Subsidiaries (US) may, without securing the liability
             of the Guaranteed Obligations, issue, assume or
             guarantee Indebtedness that would otherwise be
             subject to the foregoing restrictions in an aggregate
             principal amount that, together with all other such
             Indebtedness of the Guarantor and its Subsidiaries
             (US) that would otherwise be subject to the foregoing
             restrictions (not including Indebtedness permitted to
             be secured under the definition of Permitted Liens)
             and the aggregate amount of Attributable Indebtedness
             deemed outstanding with respect to Sale/Leaseback
             Transactions (other than those in connection with
             which the Company has voluntarily retired any Pari
             Passu Indebtedness or any Funded Indebtedness
             pursuant to Clause 9.12(c)) does not at any one time
             exceed fifteen percent. (15%) of Consolidated Net
             Tangible Assets of the Guarantor and its consolidated
             Subsidiaries (US).
                    
             9.13   Limitation on Sale/Leaseback Transactions
      
             The Guarantor shall not, and shall not permit any
             Subsidiary (US) to, enter into any Sale/Leaseback
             Transaction with any person (other than the Guarantor
             or a Subsidiary (US)) unless:
             
                    (a)    the Guarantor or such Subsidiary (US) would be
                    entitled to incur Indebtedness in a principal
                    amount equal to the Attributable Indebtedness
                    with respect to such Sale/Leaseback
                    Transaction secured by a Lien on the property
                    subject to such Sale/Leaseback Transaction
                    pursuant to Clause 9.13 without equally and
                    ratably securing the obligations of the
                    Guarantor under the Guarantee and Indemnity
                    pursuant to such covenant;
                    
                    (b)    after the date of this Guarantee and Indemnity
                    and within a period commencing nine months
                    prior to the consummation of such
                    Sale/Leaseback Transaction and ending nine
                    months after the consummation thereof, the
                    Guarantor or such Subsidiary (US) shall have
                    expended for property used or to be used in
                    the ordinary course of business of the
                    Guarantor and its Subsidiaries (US) an amount
                    equal to all or a portion of the net proceeds
                    of such Sale/Leaseback Transaction and the
                    Guarantor shall have elected to designate such
                    amount as a credit against such Sale/Leaseback
                    Transaction (with any such amount not being so
                    designated to be applied as set forth in
                    clause (c) below or as otherwise permitted);
                    or
                    
                    (c)    the Guarantor, during the nine-month period
                    after the effective date of such
                    Sale/Leaseback Transaction, shall have applied
                    to either (i) the voluntary defeasance or
                    retirement of any Pari Passu Indebtedness or
                    any Funded Indebtedness or (ii) the
                    acquisition of one or more Principal
                    Properties at fair value, an amount equal to
                    the greater of the net proceeds of the sale or
                    transfer of the property leased in such
                    Sale/Leaseback Transaction and the fair value,
                    as determined by the board of directors of the
                    Guarantor and evidenced by a board resolution,
                    of such property at the time of entering into
                    such Sale/Leaseback Transaction (in either
                    case adjusted to reflect the remaining term of
                    the lease and any amount expended by the
                    Guarantor as set forth in clause (b) above),
                    less an amount equal to the sum of the
                    principal amount of Pari Passu Indebtedness
                    and Funded Indebtedness voluntarily defeased
                    or retired by the Guarantor plus any amount
                    expended to acquire any Principal Properties
                    at fair value, within such nine-month period
                    and not designated as a credit against any
                    other Sale/Leaseback Transaction entered into
                    by the Guarantor or any Subsidiary (US) during
                    such period.
                    
             9.14   The Guarantor hereby covenants with the Lessor that,
             so long as it remains under any liability, actual or
             contingent, under this Guarantee and Indemnity it
             shall provide to the Lessor a certificate, signed by
             a Director of the Guarantor, stating that (i) the
             Lessee is complying with clause 11.7(c) of the Head
             Lease and (ii) the Guarantor shall procure that the
             Lessee will continue to comply with clause 11.7(c) of
             the Head Lease, such certificate to be provided at
             the same time as it is required to provide to the
             Lessor the annual consolidated audited accounts of
             the Guarantor and the Group pursuant to Clause 9.1.

      
10.    PAYMENTS AND TAXES

10.1   PAYMENTS

10.1   PAYMENTS AND TAXES

             (a)    All sums payable to the Lessor pursuant to or in
             connection with this Guarantee or Indemnity shall be
             paid in full without any set-off or counterclaim
             whatsoever and free and clear of all deductions or
             withholdings whatsoever save only as may be required
             by law.
             
             (b)    If any deduction or withholding is required by law in
             respect of any payment due to the Lessor pursuant to
             or in connection with this Guarantee and Indemnity or
             any document contemplated by or entered into pursuant
             hereto, the Guarantor shall:
             
                    (i)    ensure or procure that the deduction or
                    withholding is made and that it does not
                    exceed the minimum legal requirement therefor;
                    
                    (ii)   pay, or procure the payment of, the full
                    amount deducted or withheld to the relevant
                    Taxation or other authority in accordance with
                    the applicable law;
      
                    (iii)  increase the payment in respect of which the
                    deduction or withholding is required so that
                    the net amount received by the Lessor after
                    the deduction or withholding (and after taking
                    account of any further deduction or
                    withholding which is required to be made which
                    arises as a consequence of the increase) shall
                    be equal to the amount which the Lessor would
                    have been entitled to receive in the absence
                    of any requirement to make a deduction or
                    withholding; and
      
                    (iv)   promptly deliver or procure the delivery to
                    the Lessor of appropriate receipts evidencing
                    the deduction or withholding which has been
                    made.
      
             (c)    If the Lessor determines in its absolute discretion
             that it has received, realised, utilised and retained
             a Tax benefit by reason of any deduction or
             withholding in respect of which the Guarantor has
             made an increased payment or paid a compensating sum
             under this Clause 10.1 the Lessor shall, provided the
             Lessor has received all amounts which are then due
             and payable under any of the provisions of this
             Guarantee and Indemnity, pay to the Guarantor (to the
             extent that the Lessor can do so without prejudicing,
             the amount of that benefit and the right of the
             Lessor to obtain any other benefit relief or
             allowance which may be available to it) as soon as
             reasonably practicable such amount, if any, as the
             Lessor shall determine in its absolute discretion
             will leave the Lessor in no better and no worse
             position than the Lessor would have been in if the
             deduction or withholding had not been required,
             
             PROVIDED THAT:
             
                    (i)    the Lessor shall have an absolute discretion
                    as to the time at which and the order and
                    manner in which it realises or utilises any
                    Tax benefit;
                    
                    (ii)   the Lessor shall not be obliged to disclose
                    any information regarding its business, Tax
                    affairs or Tax computations;
                    
                    (iii)  if the Lessor has made a payment to the Lessee
                    pursuant to Clause 10.1(c) on account of any
                    Tax benefit and it subsequently transpires
                    that the Lessor did not receive that Tax
                    benefit, or received a lesser Tax benefit, the
                    Guarantor shall pay on demand to the Lessor
                    such sum as the Lessor may determine as being
                    necessary to restore the after-Tax position of
                    the Lessor to that which it would have been
                    had no adjustment under this proviso (iii)
                    been necessary.  
                    
                    (iv)   the Lessor shall not be obliged to make any
                    payment under this Clause 10.1 if, by doing
                    so, it would contravene the terms of any
                    applicable law or any notice, direction or
                    requirement of any governmental or regulatory
                    authority (whether or not having the force of
                    law);
             
             PROVIDED FURTHER THAT if the Guarantor requests the
             Lessor, in writing, to make an application pursuant
             to the provisions of a double tax treaty for relief
             (whether in whole or in part) in respect of any
             deduction or withholding required by law, the Lessor
             shall (at the cost of the Guarantor) take such action
             as the Guarantor shall reasonably request to make
             such application to an applicable Tax authority.  If
             the Lessor subsequently obtains a repayment (whether
             in whole or in part) of such deduction or withholding
             from that Tax authority in circumstances where the
             Guarantor has made an increased payment or paid a
             compensating sum under this Clause 10.1 the Lessor
             shall, provided that the Lessor has received all
             amounts which are then due and payable by the
             Guarantor under any of the provisions of this
             Guarantee and Indemnity, pay to the Guarantor as
             great an amount of the repayment as possible as will
             leave the Lessor in no worse position than the Lessor
             would have been in if the deduction or withholding
             had not been required.
             
10.2   VALUE ADDED TAX
      
             (a)    If the Lessor makes any supply for Value Added Tax
             purposes pursuant to or in connection with this
             Guarantee and Indemnity or any transaction or
             document contemplated herein, the Guarantor shall
             (save to the extent that the Lessor is entitled to be
             indemnified in respect of that Value Added Tax by an
             increased payment under Clause 10.2(b) below) at such
             time as the Lessor certifies to the Guarantor that
             any amount of VAT payable in respect of that supply
             has not been paid to the Lessor and having duly
             accounted for such VAT to Customs and Excise at the
             correct time and having duly claimed bad debt relief
             in respect of that VAT the Lessor either has or has
             not received such relief, pay on demand to the Lessor
             an amount equal to the aggregate of any Value Added
             Tax which is payable in respect of that supply and
             has not been the subject of bad debt relief and
             interest on an amount equal to any Value Added Tax
             payable in respect of the supply at LIBOR ascertained
             in respect of the date on which such VAT was
             accounted for to Customs and Excise for the period
             from that date until the date of the Lessor's
             certificate or the date upon which bad debt relief is
             received.
             
             (b)    Save where expressly provided to the contrary, all
             payments made under this Guarantee and Indemnity are
             calculated without regard to Value Added Tax.  If any
             such payment constitutes the whole or any part of the
             consideration for a taxable or deemed taxable supply
             (whether that supply is taxable pursuant to the
             exercise of an option or otherwise), the amount of
             that payment shall be increased by an amount equal to
             the amount of Value Added Tax which is chargeable in
             respect of the taxable supply in question PROVIDED
             THAT the Lessor shall not be liable to pay an amount
             in respect of Value Added Tax until such time as, and
             to the extent that it receives a credit for such VAT
             as "INPUT TAX", as defined in sub-section (1) of
             section 24 of VATA, under sections 25 and 26 of VATA,
             in which case such payment shall be made as soon as
             practicable after the credit is received.
             
             (c)    If any amount of Value Added Tax paid by the Lessor
             pursuant to this Guarantee and Indemnity shall be
             Irrecoverable VAT, the Guarantor shall forthwith on
             demand by the Lessor indemnify the Lessor and keep
             the Lessor fully indemnified at all times against
             such Irrevocable VAT PROVIDED THAT if the Lessor
             determines that such Irrecoverable VAT subsequently
             proves to be recoverable, the Lessor shall pay to the
             Guarantor such amount, if any, as the Lessor in its
             absolute discretion shall determine will leave the
             Lessor in no better and no worse a position than the
             Lessor would have been in if no payment had been made
             by the Guarantor to the Lessor under this
             Clause 10.2(c).


11.    ADDITIONAL SECURITY

             This Guarantee and Indemnity is in addition to and is not to
      prejudice, or be prejudiced by, any other guarantee or
      security for the obligations of the Lessee, any other
      Primary Obligor or any other person under the Guaranteed
      Agreements or otherwise now or hereafter held by the Lessor
      and it shall not be necessary for the Lessor before claiming
      payment under this Guarantee and Indemnity to resort to or
      seek to enforce any other guarantee or security in respect
      of the said obligations of the Lessee, any other Primary
      Obligor or any other person.

12.    ACKNOWLEDGEMENT AND DECLARATION

12.1   The Guarantor agrees, acknowledges and declares that:

             12.1.1 if any payment received by the Lessor in respect of
             monies owing or due and payable by the Lessee and/or
             any other Primary Obligor shall on the subsequent
             insolvency or liquidation of the Lessee and/or any
             other Primary Obligor be avoided under any laws
             relating to insolvency or liquidation, such payment
             shall not be considered as discharging or diminishing
             the liability of the Guarantor under this Guarantee
             and Indemnity and this Guarantee and Indemnity shall
             continue to apply as if such payment had at all times
             remained owing by the Lessee and/or any other Primary
             Obligor;

             12.1.2 this Guarantee and Indemnity shall remain the
             property of the Lessor and notwithstanding that all
             monies and liabilities due or incurred by the Lessee
             and/or any other Primary Obligor to the Lessor which
             are guaranteed hereunder shall have been fully paid
             and discharged the Lessor shall be entitled not to
             discharge this Guarantee and Indemnity or any
             security held by the Lessor for the obligations of
             the Guarantor hereunder until the Guarantor shall
             have procured that the Lessor receives legal opinions
             in form and content reasonably satisfactory to the
             Lessor in relation to the risk to the Lessor of
             payments received by the Lessor being avoided, set
             aside or being required to be repaid in the event of
             bankruptcy, winding-up or any similar proceedings
             being commenced in respect of the Lessee and/or any
             other Primary Obligor and in the event of bankruptcy,
             winding-up or any similar proceedings being commenced
             in respect of the Lessee and/or any other Primary
             Obligor the Lessor shall be at liberty not to
             discharge this Guarantee and Indemnity or any
             security held by the Lessor for the obligations of
             the Guarantor hereunder for and during such further
             period as the Lessor may reasonably determine;

             12.1.3 if the Guarantor has not paid to the Lessor the full
             amount of all sums then due under this Guarantee and
             Indemnity the Lessor shall be entitled, for the
             purpose of enabling the Lessor to sue the Lessee, any
             other Primary Obligor and/or any other guarantor of
             the liabilities which are guaranteed by this
             Guarantee and Indemnity or for proving in its or
             their liquidation or in any similar proceedings for
             any monies due and unpaid by the Lessee and/or any
             other Primary Obligor to the Lessor, at any time
             place and keep for such time as it may think fit any
             monies received hereunder, or under any of such other
             guarantees or from any other person, to the credit of
             an interest bearing securities realised account or
             accounts without any obligation on the part of the
             Lessor to apply the same or any part  thereof in or
             towards the discharge of the indebtedness and
             liabilities of the Lessee and/or any other Primary
             Obligor to the Lessor;
             
             12.1.4 it has received executed copies of, and is aware of
             the terms of, the Guaranteed Agreements; and
             
             12.1.5 in respect of the Guarantor's liability hereunder
             after the Lessor has made any demand for payment, the
             Lessor upon giving the Guarantor notice (except where
             set off operates by law) shall be entitled to set off
             the Guarantor's liability against any credit balance
             to which the Guarantor is beneficially entitled on
             any account or accounts which the Guarantor may have
             at any of the offices or branches of any member of
             Barclays Bank plc and to retain as security for the
             discharge of the Guarantor's liabilities all
             securities or other property of the Guarantor held by
             the Lessor (whether for safe custody or otherwise)
             PROVIDED THAT nothing herein contained shall apply to
             create any charge which depends for its validity on
             being duly recorded in any public registry.  


13.    ASSIGNMENT

13.1   ASSIGNMENT BY LESSOR

      The Guarantor acknowledges and agrees that the Lessor shall
      be entitled at any time and from time to time to assign,
      transfer or otherwise dispose of all of its interest in the
      Vessel together with this Guarantee and Indemnity and the
      Lease Documents to which it is a party to any person to whom
      the Lessor may assign, transfer or otherwise dispose of all
      of its interest in the Vessel and the benefit and burden of
      the Lease Documents to which it is a party pursuant to
      Clause 28 of the Head Lease provided that, the Guarantor
      shall not be required to suffer or incur any greater cost
      under this Guarantee and Indemnity than would have been the
      case but for such assignment.

13.2   ASSIGNMENT BY GUARANTOR

      Save as contemplated by Clause 9.10 the Guarantor may not
      assign, transfer or part with any of its rights or
      obligations under this Guarantee and Indemnity or any of the
      Lease Documents without the prior written consent of the
      Lessor.


14.    COSTS AND EXPENSES

             The Guarantor shall indemnify the Lessor, on a full
      indemnity basis, from and against, and on demand reimburse
      the Lessor for, all costs, charges and expenses, properly
      incurred following a Relevant Event by the Lessor in
      connection with or incidental to the protection and
      preservation of the security  hereby constituted or the
      exercise or enforcement of, or in endeavouring to exercise
      or enforce, any right or remedy conferred upon the Lessor
      hereunder or by law including in connection with any action
      brought by the Lessor to recover any payment due hereunder,
      or relating to any breach of any covenant or obligation in
      this Guarantee and Indemnity, whether or not any such action
      progresses to judgment.


15.    MISCELLANEOUS

15.1   DELAY IN ENFORCEMENT, WAIVERS ETC.

             All waivers of any right, power or privilege by either party
      hereto shall be in writing signed by such party. No failure
      or delay on the part of either party in exercising any power
      or right hereunder shall operate as a waiver thereof nor
      shall any single or partial exercise of any such right or
      power preclude any other or further exercise of any such
      right or power.  The rights and remedies herein provided are
      cumulative and not exclusive of any rights or remedies
      provided by law or in equity.

15.2   Variation

      This Guarantee and Indemnity shall only be amended, modified
      or varied by an instrument in writing executed by or on
      behalf of the parties hereto.

15.3   INVALIDITY

      If any term or provision of this Guarantee and Indemnity or
      the application thereof to any person or circumstance shall
      to any extent be invalid or unenforceable under any
      applicable law neither the remainder of this Guarantee and
      Indemnity or application of such term or provision to
      persons or circumstances other than those as to which it is
      already invalid or unenforceable shall be affected thereby
      nor shall the validity, legality and enforceability of such
      term or provision under the laws of any other jurisdiction
      be in any way affected or impaired.

15.4   NOTICES

             15.4.1 Any demand, consent, record, election or notice (a
             "NOTICE") required or permitted to be given by either
             party to the other under this Guarantee and Indemnity
             shall be in writing and sent by first-class prepaid
             airmail post or delivered by hand or sent by fax
             addressed as follows:

                    (i)    if to the Guarantor to:
                    
                    Global Marine Inc. 
                    777 North Eldridge Parkway
                    Houston
                    Texas 77079
                    United States of America
                    
                    Fax:   +(1) 281 596 5196
                           Attention:     General Counsel


                    (ii)   if to the Lessor to:

                           BMBF (No.12) Limited
                           Churchill Plaza
                           Churchill Way
                           Basingstoke
                           Hampshire
                           RG21 7GL
                           
                           Fax:          +(44) (0)1256 810 283
                           Attention:           Company Secretary
                           Referring to: "Schedule Number 52/5050 5371-3"
                           
             or in each case to such address or facsimile number
             as one party may, by not less than three (3) Houston
             Business Days' notice, notify in writing to the other
             party hereto.  

             15.4.2 Any notice shall be deemed to have been given or
             received to or by the party to whom it is addressed
             ten (10) days following posting, if posted by first
             class prepaid airmail post and on receipt, if
             delivered by hand.  Any notice sent by fax shall be
             treated as received only when the sender has received
             a fax by return from the recipient acknowledging
             receipt.

15.5   APPLICABLE LAW

             This Guarantee and Indemnity shall be governed by and
      construed, and performance thereof shall be determined, in
      accordance with the laws of England.

15.6   COUNTERPARTS

             This Guarantee and Indemnity may be executed in several
      counterparts and any single counterpart or set of
      counterparts, signed in either case by all of the parties,
      shall be deemed to be an original, and all taken together
      shall constitute one and the same instrument.

15.7   FURTHER ASSURANCES

             The Guarantor agrees from time to time, and at the
      Guarantor's expense, to do and perform such other and
      further acts and execute and deliver any and all such other
      instruments as may be required by law or reasonably
      requested by the Lessor to establish, maintain and protect
      the rights and remedies of the Lessor and to carry out and
      effect the intent and purpose of this Guarantee and
      Indemnity and the other Lease Documents.

15.8   ENTIRE AGREEMENT

             This Guarantee and Indemnity, in conjunction with the Lease
      Documents and any letter agreements of even date herewith
      between the Guarantor and the Lessor, constitutes the entire
      agreement between the parties hereto in relation to this
      Guarantee and Indemnity and supersedes all previous
      proposals, agreements and other written and oral
      communications in relation thereto.


16.    SUBMISSION TO JURISDICTION

      16.1   For the exclusive benefit of the Lessor, the Guarantor
      hereby submits to the non-exclusive jurisdiction of the
      courts of England with regard to this Guarantee and
      Indemnity.  By its execution and delivery of this Guarantee
      and Indemnity, the Guarantor:

             (i)    hereby accepts for itself and in respect of its
             property, generally and unconditionally, the non-
             exclusive jurisdiction of the aforesaid courts with
             respect to this Guarantee and Indemnity;

             (ii)   waives any objections on the grounds of venue or
             forum non conveniens or any similar grounds and
             agrees that legal proceedings in any one or more
             jurisdictions shall not preclude legal proceedings in
             any other jurisdiction with respect to this Guarantee
             and Indemnity; and

             (iii)  agrees that final judgment against it in any action
             or proceedings shall be conclusive and may be
             enforced in any other jurisdiction with respect to
             this Guarantee and Indemnity within or outside
             England by suit on the judgment, a certified copy of
             which shall be conclusive evidence of the fact and of
             the amount of its indebtedness.

      16.2   The Guarantor, in the case of the courts of England, hereby
      designates, appoints and empowers WFW Legal Services Limited
      (ref. CALP/2628.16002) at its registered office for the time
      being, currently 15 Appold Street, London EC2A 2HB to
      receive, for and on behalf of it, service of process in such
      jurisdiction in any legal action or proceedings with respect
      to this Guarantee and Indemnity.  The Guarantor undertakes
      to maintain an agent for the service of process in England
      at all times whilst the Guarantor has any liability, actual
      or contingent, under this Guarantee and Indemnity.  It is
      understood that a copy of any process served as above will
      be promptly forwarded (if necessary) by first class prepaid
      mail to the Guarantor, but the failure of the Guarantor to
      receive such copy shall not affect in any way the service of
      such process on the said person as the agent of the
      Guarantor.
      
      16.3   To the extent that the Guarantor or any of the property of
      the Guarantor is or becomes entitled at any time to any
      immunity on the grounds of sovereignty or otherwise from any
      legal action, suit or proceeding, from set-off or
      counterclaim, from the jurisdiction of any competent court,
      from service of process, from attachment prior to judgment,
      from attachment in aid of execution, or from execution prior
      to judgment, or other legal process in any jurisdiction, the
      Guarantor for itself and its property does hereby
      irrevocably and unconditionally waive, and agrees not to
      plead or claim, any such immunity with respect to its
      obligations, liabilities or any other matter under or
      arising out of or in connection with this Guarantee and
      Indemnity or the subject matter hereof or thereof.
      

17.    JUDGMENT CURRENCY

             If, under any applicable law, whether as a result of a
      judgment against the Guarantor or the liquidation of the
      Guarantor or for any other reason, any payment under or in
      connection with this Guarantee and Indemnity is made or is
      recovered in a currency (the "OTHER CURRENCY") other than
      that in which it is required to be paid hereunder (the
      "ORIGINAL CURRENCY") then, to the extent that the payment
      (when converted at the rate of exchange and after deducting
      commission on the date of payment or, in the case of a
      liquidation, the latest date for the determination of
      liabilities permitted by the applicable law) falls short of
      the amount which is required to be paid under or in
      connection with this Guarantee and Indemnity as aforesaid,
      the Guarantor shall as a separate and independent obligation
      fully indemnify the Lessor on demand against the amount of
      the shortfall; and for the purposes of this Clause 17 "RATE
      OF EXCHANGE" means the rate at which the Lessor is able as
      at 11.00 a.m. (London time) on the relevant date to purchase
      the Original Currency with the Other Currency.


18.    NATURE OF DOCUMENT

       This Guarantee and Indemnity is a deed.


IN WITNESS whereof the Guarantor and the Lessor have caused this
Guarantee and Indemnity to be duly executed and delivered the day
and year first above written.


EXECUTED AND DELIVERED        )
as a DEED by W. Matt Ralls    )    W. Matt Ralls
GLOBAL MARINE INC.            )
in the presence of:           )

Tony Price

SIGNED by T. Holgate          )    T. Holgate
For and on behalf of          )
BMBF (NO.12) LIMITED          )