CONFORMED COPY


                    DATED  8th  DECEMBER 1998




                 NELSTAR LEASING COMPANY LIMITED
                            as lessor
                                
                                
                             - and -
                                
                                
                GLOBAL MARINE LEASING CORPORATION
                            as lessee
                                



      ____________________________________________________
                                
                      HEAD LEASE AGREEMENT
                           relating to
                     a Glomar Hull 456 class
                    Deepwater Drillship to be
              constructed by Harland and Wolff with
                        hull number 1739
                  (t.b.n. "GLOMAR C.R. LUIGS")
      ____________________________________________________




                        TABLE OF CONTENTS


Clause  Heading                                                Page

1.      DEFINITIONS AND INTERPRETATIONS                         1
2.      REPRESENTATIONS AND WARRANTIES                         28
3.      CONDITIONS PRECEDENT                                   29
4.      LEASING AND DELIVERY AND ACCEPTANCE OF THE VESSEL      30
5.      DISCLAIMERS AND EXCLUSIONS, LESSOR'S COVENANTS         31
6.      LEASE PERIOD                                           35
7.      RENT                                                   36
8.      PAYMENTS                                               37
9.      COVENANTS CONCERNING INSURANCES                        39
10.     TOTAL LOSS AND DAMAGE                                  45
11.     GENERAL COVENANTS AND UNDERTAKINGS OF THE LESSEE       48
12.     OPERATIONAL COVENANTS IN RELATION TO THE VESSEL        50
13.     BENEFIT OF THIRD PARTY WARRANTIES                      57
14.     INSPECTION                                             59
15.     RISK                                                   59
16.     REQUISITION FOR HIRE                                   60
17.     SALVAGE                                                61
18.     TITLE AND LIENS                                        61
19.     RE-DELIVERY AND SALE OF THE VESSEL                     62
20.     PROCEEDS OF SALE                                       65
21.     TERMINATION PROVISIONS                                 66
22.     SECURITY AND SECURITY REVIEW                           72
23.     EXCLUDED OBLIGATIONS                                   75
24.     CHANGE OF CIRCUMSTANCES ETC.                           77
25.     GENERAL INDEMNITY                                      79
26.     GENERAL TAX INDEMNITY AND OTHER TAX PROVISIONS         84
27.     PRESERVATION OF INDEMNITIES                            90
28.     ASSIGNMENT                                             90
29.     LESSOR'S RIGHT OF SET-OFF                              92
30.     SUB-LEASING                                            92
31.     MISCELLANEOUS                                          93
32.     CONFIDENTIALITY                                        97

SCHEDULE 1 Financial Schedule                                  99
SCHEDULE 2                                                    100
SCHEDULE 3 INTENTIONALLY OMITTED                              101
SCHEDULE 4 Part 1 - Representations and Warranties
                    by the Lessee                             102
           Part 2 - Representations and warranties
                    by the Lessor                             105
SCHEDULE 5 Part 1 - Conditions precedent to the 
                    obligations of the Lessor generally       106
           Part 2 - Conditions precedent to Lessor's 
                    payment obligations under the
                    Shipbuilding Contract                     108
           Part 3 - Conditions Precedent to Delivery          111
           Part 4 - Conditions Precedent to the 
                    obligations of the Lessee generally       113
SCHEDULE 6 Form of Acceptance Certificate                     114
SCHEDULE 7 Part I - Form of Hull and Machinery 
                   (Marine and War Risks) Loss Payable Clause 115
SCHEDULE 7 Part II -Form of Protection and Indemnity 
                    Risks Loss Payable Clause                 116



THIS AGREEMENT dated  8th December, 1998 is made 

BETWEEN:

       (1)    NELSTAR LEASING COMPANY LIMITED, a company incorporated
       under the laws of England and Wales with company
       registration number 1581384 whose registered office is at
       71 Lombard Street, London EC3P 3BS, England; and
       
       (2)    GLOBAL MARINE LEASING CORPORATION, a company incorporated
       under the laws of the Commonwealth of the Bahamas whose
       registered office is at Mareva House, 4 George Street,
       Nassau, the Commonwealth of the Bahamas.
       

WHEREAS:

The Lessor carries on the trade of leasing and pursuant to the
Shipbuilding Contract and the Construction Supervision Agreement
has agreed to incur capital expenditure on the provision of the
Vessel for leasing to the Lessee on and subject to the terms and
conditions contained in this Agreement.


NOW IT IS AGREED:

       1.     DEFINITIONS AND INTERPRETATIONS
       
1.1    DEFINITIONS

              In this Agreement the following words and expressions
       shall each have the meaning respectively attributed to
       them below:

              "ACCELERATION NOTICE" means a written notice from the
       Lessor to the Lessee given under Clause 6.3;

              "ACCELERATION OPTION" means the option on the part of the
       Lessor the terms of which are set out in Clause 6.3;

              "ACCELERATION RENT" shall have the meaning attributed to
       that term in Clause 6.3;
              
              "ACCEPTANCE CERTIFICATE" means the certificate given by
       the Lessee to the Lessor pursuant to Clause 4.2, in or
       substantially in the form of Schedule 6;

              "ACCOUNTING PERIOD" means an accounting period as defined
       in section 12 of ICTA 1988;
              
              "Accounts" means, together, the First Account and the
       Second Account;

              "ADDITIONAL PAYMENT" shall have the meaning attributed to
       that term in Clause 26.5;

              "ADDITIONAL SECURITY" means additional security for the
       obligations of the Lessee under this Agreement in form and
       content acceptable to the Lessor, provided in accordance
       with Clause 22.3;

              "ADDITIONAL SECURITY DOCUMENTS" means all documents under
       which Additional Security is constituted or by which such
       security is evidenced or pursuant to which the Lessee
       obtains or secures the provision of any Additional
       Security;

              "ADDITIONAL SECURITY PROVIDER" means any person providing
       Additional Security;

              "ADJUSTMENT DATE" shall have the meaning attributed to
       that term in the Financial Schedule;

              "APPROVED BROKERS" means McGriff, Seibels & Williams of
       Texas, Inc. or such other firm or firms of insurance
       brokers as may from time to time be approved in writing by
       the Lessor for the purposes of this Agreement (such
       consent not to be unreasonably withheld);

              "ASSUMPTIONS" shall have the meaning attributed to that
       term in the Financial Schedule;

              "BALANCE" shall have the meaning attributed to that term
       in the Financial Schedule;

              "BANK" means Lloyds Bank Plc, registered in England with
       company registration number 2065 and shall include its
       successors but shall not include its assignees or
       transferees under clause 11.3 of each of the Deposit
       Deeds;

              "BANK GUARANTEE" means the guarantee granted or, as the
       context may require, to be granted on or about the date of
       this Agreement to the Lessee by the Bank in relation to
       the obligations of the Lessor under this Agreement;

              "BASE RATE" means the base rate from time to time quoted
       by the Bank in London as its "BASE RATE" or, if no rate of
       interest is quoted as such, the rate of interest from time
       to time certified by the Bank in London as being the rate
       which the Bank uses as the base for determining rates of
       interest charged to corporate customers;

              "BROKEN FUNDING COSTS" shall have the meaning attributed
       to that term in the Financial Schedule;
              
              "BROKEN FUNDING GAINS" shall have the meaning attributed
       to that term in the Financial Schedule;

              "BUILDER" means Harland and Wolff Shipbuilding and Heavy
       Industries Ltd., a company incorporated under the laws of
       Northern Ireland, whose principal office is at Queen's
       Island, Belfast, Northern Ireland BT3 9DU;
              
              "BUSINESS DAY" means a day on which dealings in Sterling
       deposits are carried on in the London Inter-Bank Market
       and (other than a Saturday or Sunday, or holiday scheduled
       by law) on which banks are open for business (a) in the
       City of London and (b) if on that date any payment falls
       to be made under any of the Relevant Lease Documents other
       than in Sterling, in the principal financial centre in the
       country of the currency concerned and (c) if on that date
       no payment falls to be made under any of the Relevant
       Lease Documents, in Houston, Texas;

              "CAA 1990" means the Capital Allowances Act 1990;

              "CALCULATION PERIOD" means 
              
                     (a)  in relation to the Instalment Date for the First
              Instalment and the Second Instalment, the period
              commencing on that Instalment Date and ending on
              the next date set out in the column headed "Date"
              in Part A of Schedule 2 and thereafter the period
              commencing on a date set out in that column and
              ending on the next date set out in that column up
              to and including the date set out in that column
              which is the same date as the Instalment Date for
              the Delivery Instalment; or

                     (b)  at any time on or after the Instalment Date for the
              Delivery Instalment, each period commencing on a
              date set out in the column headed "Date" in Part A
              of Schedule 2 and ending on the next date shown in
              that column;

              "CHANGE OF LAW" means, in each case after the date on
       which this Agreement is originally executed:

                     (a)  the implementation, introduction, abolition,
              withdrawal or variation of, any applicable law,
              regulation, practice or concession or official
              directive, ruling, request, notice, guideline,
              statement of policy or practice statement by the
              Bank of England, the European Union or any central
              bank or tax, fiscal, revenue, monetary,
              governmental, local, international, national or
              other competent authority or agency (whether or not
              having the force of law but in respect of which
              compliance by banks or other financial institutions
              or institutions of a similar nature to the Lessor
              in the relevant jurisdiction is generally
              customary); or

                     (b)  any change in any interpretation, or the
              introduction or making of any new or further
              interpretation, or any new or different
              interpretation of any applicable law, regulation,
              practice or concession or official directive,
              ruling, request, notice, guideline, statement of
              policy or practice statement by any court,
              tribunal, governmental, local, international,
              national or other competent authority or agency or
              the Bank of England, the European Union or any
              central bank or tax, fiscal, revenue or monetary
              authority or agency (whether or not having the
              force of law but in respect of which compliance by
              banks or other financial institutions or
              institutions of a similar nature to the Lessor in
              the relevant jurisdiction is generally customary);
              or

                     (c)  compliance with any new or different request or
              direction from the  Bank of England, the European
              Union or any central bank, tax, fiscal, monetary,
              revenue, governmental, local, international,
              national or other competent authority or agency
              (whether or not having the force of law but in
              respect of which compliance by banks or other
              financial institutions or institutions of a similar
              nature to the Lessor in the relevant jurisdiction
              is generally customary);

              "CHAPS" means the Clearing Houses Automated Payments
       System;

              "CIBC" means Canadian Imperial Bank of Commerce acting
       through its London branch at Cottons Centre, Cottons Lane,
       London SE1 2QL, England;

              "CIBC PAYMENT AGREEMENT" means the payment agreement
       entered into or, as the context may require, to be entered
       into on or about the date of this Agreement between CIBC,
       the Lessor and the Lessee relating to the undertaking by
       CIBC to perform certain payment obligations;

              "CLASSIFICATION" means A1-E Mobile Offshore Drilling Unit-
       DPS-3 AMS ACCU, R2S (or, as the case may be, its equivalent)
       with the Classification Society or such other classification
       as the Lessor shall, at the request of the Lessee, have
       agreed in writing shall be treated as the Classification for
       the purposes of this Agreement;
              
              "CLASSIFICATION SOCIETY" means American Bureau of Shipping
       or any other classification society which is a member of
       the International Association of Classification Societies
       (or equivalent body for the time being);
              
              "COMMENCEMENT DATE" shall have the meaning attributed to
       that term in the Financial Schedule;

              "COMMERZBANK" means Commerzbank A.G. acting through its
       London branch at 23 Austin Friars, London EC2N 2EN,
       England;
              
              "COMMERZBANK PAYMENT AGREEMENT" means the payment
       agreement entered into or, as the context may require, to
       be entered into on or about the date of this Agreement
       between Commerzbank, the Lessor and the Lessee relating to
       the undertaking by Commerzbank to perform certain payment
       obligations;

              "COMPULSORY ACQUISITION" means requisition for title or
       other compulsory acquisition, requisition, appropriation,
       expropriation, deprivation, forfeiture or confiscation for
       any reason of the Vessel by any Government Entity or other
       competent authority, whether de jure or de facto, but
       shall exclude requisition for use or hire not involving
       requisition of title;

              "CONSTITUTIVE DOCUMENTS" in relation to any English
       company means that company's certificate of incorporation
       and memorandum and articles of association and, in
       relation to any overseas person (whether incorporated,
       established or otherwise formed, but excluding natural
       persons), means the documents having equivalent status and
       effect in the relevant jurisdiction;
              
              "CONSTRUCTION SUPERVISION AGREEMENT" means the agreement
       entered or to be entered into between the Lessor and GMIDC
       with respect to the supervision by GMIDC of the
       construction of the Vessel;
              
              "CONTRIBUTION DEED" means the deed entered into or, as the
       context may require, to be entered into between the
       Lessor, the Lessor's Agent and the Sub-Lessee providing
       for the making by the Sub-Lessee of a capital contribution
       to the Lessor's cost of the acquisition of the Vessel from
       time to time;
              
              "CORPORATION TAX" means corporation tax chargeable in the
       context of the scheme of Taxation applied to United
       Kingdom resident companies generally at the rate
       applicable to such companies (disregarding the provisions
       of section 13 of ICTA 1988 concerning the small companies'
       rate) or any Tax of a similar nature enacted in addition
       to or substitution for corporation tax;

              "COST OF MANAGEMENT TIME" means the cost of the management
       time of the Lessor (or any other member of the Lessor's
       Group acting on behalf of the Lessor) incurred by any
       director or employee of the Lessor or such member of the
       Lessor's Group charged at the rate of two hundred Pounds-
       Sterling(200) (as such figure shall be increased on an annual
       basis by the percentage increase in the RPI since 1st
       January 1998) per hour;
              
              "DATE OF TOTAL LOSS" shall have the meaning attributed to
       that term in Clause 10.3;

              "DEFAULT RATE" in respect of Sterling amounts means the
       percentage rate per annum which is two per cent (2%) over
       Base Rate and, in respect of other amounts means 2% over
       the cost to the Lessor of funding the relevant amount, in
       the relevant currency;

              "DELIVERY" means delivery of the Vessel by the Lessor to
       the Lessee in accordance with Clause 4.2;

              "DELIVERY DATE" means the date on which the Vessel is
       delivered by the Lessor to the Lessee in accordance with
       Clause 4.2;
              
              "DELIVERY INSTALMENT" means the amount paid or, as the
       context may require, payable by the Lessor (i) to the
       Lessor's Agent on the Delivery Date pursuant to clause 5.1
       of the Construction Supervision Agreement and (ii) to the
       Builder pursuant to the Shipbuilding Contract;

              "DEPOSIT BANK" means Lloyds Bank Plc, acting through its
       branch at 71 Lombard Street, London EC3P 3BS as holder of
       the Accounts and shall include, where the context
       requires, any successors or assignees and/or transferees
       pursuant to clause 11.3 of the relevant Deposit Deed of
       the then current Deposit Bank;

              "DEPOSIT DEEDS" means, together, the First Deposit Deed
       and the Second Deposit Deed;

              "DETERMINATION" shall have the meaning attributed to that
       term in Clause 1.4(a);
              
              "DOCUMENT OF COMPLIANCE" shall have the meaning
       attributable to that term in the ISM Code;

              "DOLLARS" and "$" each means the lawful currency for the
       time being of the United States of America and in respect
       of all payments to be made to the Lessor under this
       Agreement and any of the other Relevant Lease Documents in
       Dollars, each means immediately available, freely
       transferable cleared funds in Dollars;
              
              "EARLY TERMINATION FEE" means an amount calculated in
       accordance with paragraph 4.4 of the Financial Schedule;

                     "ENVIRONMENT" means:
                     
                     (i)  any land including, without limitation, surface
              land and sub-surface strata, sea bed or river bed
              under any water (as defined below) and any natural
              or man-made structures;
                     
                     (ii) water including, without limitation, coastal and
              inland waters, surface waters, ground waters and
              water in drains and sewers; and
                     
                     (iii) air, including air within buildings and other
              natural and man-made structures above and below
              ground;
                     
              "ENVIRONMENTAL CLAIM" means any written or oral notice
       from any Government Entity or, subject to the proviso
       below, any third party, alleging any breach, contravention
       or violation of any Environmental Law or the existence of
       any liability or potential liability arising from any such
       breach, contravention or violation including, without
       limitation, in respect of liability to conduct, pay for or
       for damages in respect of any investigation or audit,
       clean-up, redemption, administrative cost or charge or
       expense, damage to the Environment or any natural
       resource, property loss or damage, personal injury or any
       penalty attaching or relating to the presence, emission,
       release or leak of any Hazardous Material in or to the
       Environment PROVIDED THAT there shall be excluded from
       this defined term any such allegation from a third party
       (not being a Government Entity) which the Lessee, acting
       reasonably, believes to be spurious or not made in good
       faith;
                     
              "ENVIRONMENTAL LAW" means any or all applicable law
       (whether civil, criminal or administrative), common law,
       statute, statutory instrument, treaty, convention,
       regulation, directive, by-law, demand, decree, injunction,
       resolution, order or judgment (in each case having the
       force of law) and codes of practice or conduct (in respect
       of which compliance by persons carrying on the same
       business as the Lessee is customary), circulars and
       guidance notes having legal or judicial import or effect,
       in each case of any Government Entity (whether now
       existing or hereafter promulgated) in any applicable
       jurisdiction relating to or concerning:
                     
                     (a)  pollution or contamination of the Environment;

                     (b)  harm, whether actual or potential, to mankind and
              human senses, other living organisms and ecological
              systems;

                     (c)  the generation, manufacture, processing,
              distribution, use (including abuse), treatment,
              storage, disposal, transport or handling of
              Hazardous Materials; and

                     (d)  the emission, leak, release, spill or discharge
              into the Environment of noise, vibration, dust,
              fumes, gas, odours, smoke, steam, effluvia, heat,
              light, radiation (of any kind), infection,
              electricity or any Hazardous Material and any
              matter or thing capable of constituting a nuisance
              or an actionable tort or breach of statutory duty
              of any kind in respect of such matters,

              including, without limitation, the following laws of the
       United States of America: the Comprehensive Environmental
       Response, Compensation and Liability Act of 1980, as
       amended, the Hazardous Materials Transportation Act, as
       amended, the Oil Pollution Act of 1990, as amended, the
       Federal Water Pollution Control Act, as amended, the
       Resource Conservation and Recovery Act, as amended and the
       Toxic Substance Control Act, as amended, in each case with
       the regulations promulgated and the guidance issued
       pursuant thereto;

              "ENVIRONMENTAL PERMITS" means, in relation to any person,
       all or any permits, licences, consents, approvals,
       certificates, registrations, and other authorisations and
       the filing of all notifications, reports and assessments
       required under any Environmental Law in connection with
       the conduct of such person's business and the ownership,
       use, exploitation or occupation of all of its property and
       assets;

              "EXCESS RISKS" means the proportion of claims for general
       average, salvage and salvage charges not recoverable under
       the hull and machinery policies in respect of the Vessel
       in consequence of her insured value being less than the
       value at which the Vessel is assessed for the purposes of
       such claims;

              "EXCLUDED OBLIGATIONS" shall have the meaning attributed
       to that term in Clause 23.1;

              "EXCLUDED PROPERTY" means, in respect of the Vessel, any
       items of equipment installed on or attached to the Vessel
       but which do not become or are not required to become, by
       virtue of any provision of this Agreement, part of the
       Vessel;

              "FINAL DATE" shall have the meaning attributed to that
       term in the Financial Schedule;

              "FINANCIAL SCHEDULE" means Schedule 1;

              "FINANCE LEASE" shall have the meaning attributed to that
       term in the United Kingdom Statement of Standard
       Accounting Practice 21;

              "FINANCIAL INDEBTEDNESS" in relation to any person means,
       without duplication, 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);

              "FINANCIAL STATEMENTS" means the unaudited accounts of the
       Lessee, prepared in accordance with US GAAP;

              "FIRST ACCOUNT" means the account number 1012083 entitled
       "Global Marine Leasing Corporation: Glomar C.R. Luigs
       Number One Account" opened by the Lessee with the Deposit
       Bank to which, inter alia, moneys payable by the Payment
       Banks under the Payment Agreements are to be credited;

              "FIRST ACCOUNT INTEREST ACCRUAL" means, for the Relevant
       Date in any Calculation Period, the amount shown for that
       Calculation Period in the column headed "First Account
       Interest Accrual" in Part [  ] of Schedule 2;
              
              "FIRST ACCOUNT PRINCIPAL BALANCE" means for the Relevant
       Date in any Calculation Period, the amount shown for that
       Calculation Period in the column headed "First Account" in
       Part A of Schedule 2 calculated in accordance with the
       provisions of clause 3 of the First Deposit Deed;

              "FIRST DEPOSIT DEED" means the deed so entitled entered
       into or, as the context may require, to be entered into on
       or about the date of this Agreement between the Lessee,
       the Lessor and the Deposit Bank in relation to the First
       Account;

              "FIRST INSTALMENT" means the amount paid or, as the
       context may require, payable by the Lessor pursuant to
       clause 5.1(a) of the Novation Agreement;

              "FLAG STATE" means the Republic of Panama or any other
       state or country in which the Vessel is from time to time
       registered in accordance with the provisions of Clause
       12.20;

              "GOVERNMENT ENTITY" means and includes (whether having a
       distinct legal personality or not) (i) any national
       government, political sub-division thereof or local
       jurisdiction therein, (ii) any board, commission,
       department, division, organ, instrumentality, court or
       agency of any entity referred to in (i) above, however
       constituted, and (iii) any association, organisation or
       institution (international or otherwise) of which any
       entity mentioned in (i) or (ii) above is a member or to
       whose jurisdiction any of the foregoing is subject or in
       whose activities any of the foregoing is a participant;

              "GMIDC" means Global Marine International Drilling
       Corporation, a company incorporated under the laws of the
       Commonwealth of the Bahamas whose registered office is at
       c/o McKinney, Bancroft & Hughes, Mareva House, 4 George
       Street, P.O. Box 3937, Nassau, Bahamas;

              "GUARANTEE" means the deed of guarantee and indemnity given
       or, as the context may require, to be given by the Guarantor
       in favour of the Lessor;

              "GUARANTOR" means Global Marine Inc., a company
       incorporated under the laws of the State of Delaware in
       the United States of America whose principal place of
       business is at 777 North Eldridge Parkway, Houston, Texas
       77079, United States of America;

              "GUARANTOR CREDIT CURE EVENT" means an event which shall
       occur if, following the occurrence of a Guarantor Credit
       Event, the Guarantor's unsecured, unguaranteed and
       unsubordinated long term debt is rated BBB- by Standard &
       Poor's Ratings Group ("S&P"), a division of McGraw Hill
       Corporation and Baa3 by Moody's Investors Service Inc.
       ("MOODY'S") or higher (or any successor to S&P's or, as
       the case may be, Moody's ratings business or, if there is
       no such successor, such other internationally recognised
       credit rating organisation as the Lessor may reasonably
       specify (in which case references in this Agreement to S&P
       or Moody's credit rating scales and rating terminology
       shall be construed as references to the equivalent scales
       and terminology of such successor or, as the case may be,
       such organisation so specified)) ;

              "GUARANTOR CREDIT EVENT" means an event which shall occur
       if the Guarantor's unsecured, unguaranteed and
       unsubordinated long term debt is rated below BBB- by
       Standard & Poor's Ratings Group ("S&P"), a division of
       McGraw Hill Corporation or Baa3 by Moody's Investors
       Service Inc. ("MOODY'S") (or any successor to S&P's or, as
       the case may be, Moodys' ratings business or, if there is
       no such successor, such other internationally recognised
       credit rating organisation as the Lessor may reasonably
       specify (in which case references in this Agreement to S&P
       or Moody's credit rating scales and rating terminology
       shall be construed as references to the equivalent scales
       and terminology of such successor or, as the case may be,
       such organisation so specified)) or the unsecured,
       unguaranteed and unsubordinated long term debt of the
       Guarantor shall cease to be rated at all by both such
       agencies;

              "GUARANTOR CREDIT EVENT CURE DATE" shall have the meaning
       attributed to that term in Clause 22.6(B);

              "GUARANTOR CREDIT EVENT OCCURRENCE DATE" shall have the
       meaning attributed to that term in Clause 22.2(a);

              "GUARANTOR'S GROUP" means the Guarantor and its Holding
       Company (US) and its Subsidiaries (US) from time to time;

              "HAZARDOUS MATERIAL" means any element or substance,
       whether natural or artificial, and whether consisting of
       gas, liquid, solid or vapour, whether on its own or in any
       combination with any other element or substance, which is
       listed, identified, defined or determined by any
       applicable law to be, to have been, or to be capable of
       being or becoming harmful to mankind or any living
       organism or damaging to the Environment including without
       limitation oil (as defined in the United States Oil
       Pollution Act of 1990, as amended) and all hazardous
       substances (as defined in the United States Comprehensive
       Environmental Response, Compensation and Liability Act of
       1980, as amended);

              "HOLDING COMPANY" means any holding company within the
       meaning of section 736 of the Companies Act 1985;

              "HOLDING COMPANY (US)" means a corporation which owns,
       directly or indirectly, more than 50% of the voting stock
       (as defined in the definition of "SUBSIDIARY (US)") of
       another corporation;

              "HULL INSURANCES" means the insurances described in Clause
       9.1(a)(i);

              "ICTA 1988" means the Income and Corporation Taxes Act
       1988;

              "INCREASED COST" shall have the meaning attributed to that
       term in Clause 24.4.

              "INDEMNIFIED PERSONS" shall have the meaning attributed to
       that term in Clause 25.1 (a);

              "INITIAL SERVICE CONTRACTOR" means BHP Petroleum
       (Americas) Inc., a company incorporated under the laws of
       the State of Delaware in the United States of America;

              "INSOLVENCY EVENT" means, in relation to any person any of
       the following:

                     (a) that person is unable to pay its debts as they fall
              due within the meaning of section 123(1) of the
              Insolvency Act 1986 or has a voluntary arrangement
              proposed under section 1 of the Insolvency Act 1986
              or admits in writing its inability to pay its debts
              as they mature or declares a moratorium on the
              payment of all or a substantial part of its
              indebtedness or makes a general assignment for the
              benefit of creditors or is subject to or applies
              for winding-up or liquidation proceedings or is
              successfully put into forced or voluntary
              liquidation (except for the purpose of (i)
              voluntary reorganisation of that person previously
              agreed in writing by the Lessor not involving the
              insolvency of that person and (ii) voluntary
              reorganisation of any other person not involving
              the insolvency of that person); or

                     (b) that person or any creditor or shareholder of that
              person petitions or applies to any court, tribunal
              or authority for the appointment of, or that person
              has or suffers to be appointed, any examiner,
              administrator, administrative receiver, receiver,
              liquidator, trustee or similar officer of it, its
              undertaking or any substantial part of its assets
              (unless in the case of a petition or application by
              a creditor, it is established to the reasonable
              satisfaction of the Lessor that such petition or
              application is of a frivolous or vexatious nature
              or such petition or application is dismissed within
              thirty (30) days); or

                     (c) that person shall suffer a distress, execution,
              sequestration, attachment or other process or the
              same is being levied or enforced upon or sued out
              against, in each case against the whole or a
              substantial part of the assets, rights or revenues
              of that person or a creditor takes possession of
              the whole or a substantial part of the assets,
              rights and revenues of that person, and such
              distress, execution, attachment, sequestration or
              other process is not dismissed or released or that
              person does not regain possession in each case
              within ten (10) Business Days provided that an
              arrest or other detention of the Vessel shall not
              of itself be an Insolvency Event if the provisions
              of Clause 12.17 are being complied with by the
              Lessee; or

                     (d) that person otherwise enters into any settlement or
              takes any corporate action or that person or any
              creditor or shareholder of that person takes any
              steps in relation to that person under any law,
              regulation or decree of any applicable jurisdiction
              whether now or hereafter in effect relating to or
              which has an equivalent effect to any of (a), (b)
              or (c) above;

              "INSTALMENT" means each of the First Instalment, the
       Second Instalment and the Delivery Instalment;

              "INSTALMENT DATE" means:

                     (a) in respect of the First Instalment, the date during
              which the Effective Time (as such term is defined
              in the Novation Agreement) falls;
                     (b) in respect of the Second Instalment, the date
              described in the clause 8.3.4 of the Shipbuilding
              Contract; and
                     (d) in respect of the Delivery Instalment, the date
              described in clause 8.3.5 of the Shipbuilding
              Contract;

              or, in each case, such other date or dates as the Lessee
       may notify to the Lessor upon giving not less than five
       (5) Business Days' notice (a "5 B.D. NOTICE") and, in the
       case of the Delivery Instalment, subject to the Lessee
       having given the Lessor at least one 5 B.D. Notice, such
       other date or dates as the Lessee may notify to the Lessor
       upon giving not less than one (1) Business Day's notice;

              "INSURANCE ADVISER'S FEE" means the fees, charges and
       expenses paid or payable by the Lessor to the Lessor's
       insurance adviser in respect of the transactions
       contemplated by the Lease Documents, incurred up to and
       including the Delivery Date (excluding any VAT thereon);

              "INSURANCES" means all policies and contracts of insurance
       (which expression includes all entries of the Vessel in a
       protection and indemnity or war risks association) which
       are from time to time prior to or during the Lease Period
       in place or taken out or entered into (a) pursuant to
       Clause 9 in respect of any part of the Vessel or (b)
       otherwise howsoever in connection with the Vessel and, in
       each case, all benefits thereof (including claims of
       whatsoever nature and return of premiums);

              "IRRECOVERABLE VAT" means any amounts paid or payable by
       or on behalf of the Lessor in respect of Value Added Tax
       under or as contemplated by any of the Relevant Lease
       Documents to the extent the Lessor shall determine that
       the Lessor or, if the Lessor is a member of a group for
       Value Added Tax purposes, the representative member has
       not or will not receive a credit (whether by way of credit
       or repayment) for that amount as "INPUT TAX" (as that
       expression is defined in sub-section (1) of section 24 of
       VATA) under sections 25 and 26 of VATA (nor receive a
       credit for it under any similar or equivalent legislation)
       PROVIDED THAT in calculating the amount of Irrecoverable
       VAT (if any) it shall be assumed that neither the Lessor
       nor any representative member has entered into any
       transactions other than as contemplated by the Relevant
       Lease Documents and that accurate and timely VAT returns
       have been made by the Lessor or the representative member;

              "ISM CODE" means:

                     (a) The International Safety Management Code for the
              Safe Operation of Ships and for Pollution
              Prevention currently known or referred to as the
              "ISM Code", adopted by the Assembly of the
              International Maritime Organisation by Resolution
              A.741(18) on 4th November 1993 and incorporated on
              19th May 1994 into chapter IX of the International
              Convention for the Safety of Life at Sea 1974
              (SOLAS 1974); and

                     (b) all further resolutions, circulars, codes,
              guidelines, regulations and recommendations which
              are now or may in the future be issued by or on
              behalf of the International Maritime Organisation
              or any other entity with responsibility for
              implementing the ISM code, including, without
              limitation, the "Guidelines on implementation or
              administering of the International Safety
              Management (ISM) Code by Administrations" produced
              by the International Maritime Organisation pursuant
              to Resolution A.788(19) adopted on 25th November
              1995;

              as the same may be amended, supplemented or replaced from
       time to time;

              "JOINT VENTURE" means (a) with respect to properties
       located in the United States of America, any partnership,
       corporation or other entity, in which up to and including
       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, and (b) with respect to properties located
       outside the United States of America, any partnership,
       corporation or other entity, in which up to and including
       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);

              "LEASE DOCUMENTS" means the Relevant Lease Documents, the
       Original Shipbuilding Contract, the Sub-Lease, the OFE
       Supervision Agreement, any Service Contract and any other
       document, notice, letter or instrument designated as a
       Lease Document by the Lessor and the Lessee;

              "LEASE PERIOD" means the period during which the Lessee
       shall be entitled to possession and use of the Vessel in
       accordance with this Agreement being the period, if any,
       commencing on (and including) the Delivery Date and
       terminating on (and including) the Termination Date;

              "LEASE PERIOD END DATE" means the later of the Primary
       Period End Date and the last day of the final Secondary
       Lease Period;

              "LESSEE" means Global Marine Leasing Corporation;

              "LESSOR" means Nelstar Leasing Company Limited;

              "LESSOR ACTION" means any action on the part of the Lessor
       required or permitted pursuant to this Agreement,
       including, but not limited to, the giving, refusing,
       revocation or withdrawal of any consent or approval;

              "LESSOR'S AGENT" means GMIDC;

              "LESSOR'S ARRANGEMENT FEE" means the amount of the fee
       (excluding VAT thereon) paid or payable by the Lessor to
       Atlas Oceanic Limited for services rendered to the Lessor
       in relation to the arrangement of the transactions
       contemplated by this Agreement and the other Lease
       Documents;

              "LESSOR'S COST" as at any time means the sum equal to the
       aggregate of the amounts paid by the Lessor by way of
       reimbursement to the Lessor's Agent pursuant to the
       Construction Supervision Agreement or paid to the Builder
       pursuant to the Shipbuilding Contract, being the aggregate
       of the Instalments (to the extent paid up to and including
       that time) calculated in each case by reference to the
       date on which the Lessor makes payment of the relevant
       Instalment under the Construction Supervision Agreement in
       reimbursement of expenditure incurred by the Lessor's
       Agent on behalf of the Lessor or (as the case may be)
       makes payment to the Builder pursuant to the Shipbuilding
       Contract;

              "LESSOR'S EXPENSES" means the Lessor's Arrangement Fee,
       the Lessor's Legal Expenses and the Insurance Adviser's
       Fee (if any) together with any "desk-top" valuation fee
       incurred by the Lessor in connection with the Vessel prior
       to the payment of the Delivery Instalment;

              "LESSOR'S GROUP" means the Lessor and its ultimate Holding
       Company (if any) from time to time and any company which
       is from time to time a Subsidiary of that Holding Company;

              "LESSOR'S LEGAL EXPENSES" means the amount of fees,
       disbursements and incidentals (excluding VAT thereon) paid
       or payable by the Lessor to Wilde Sapte and any relevant
       overseas legal advisers for services rendered to the
       Lessor in relation to, inter alia, the preparation,
       negotiation and completion of the transactions
       contemplated by this Agreement and the other Lease
       Documents Provided that the amount of Wilde Sapte's fees
       (excluding disbursements, incidentals and any VAT thereon)
       which shall constitute part of the Lessor's Legal Expenses
       shall not exceed a maximum amount separately agreed;

              "LESSOR'S LIEN" means a Lien of the type referred to in
       Clause 5.2(b) but excluding (other than for the purposes
       of any title warranty in respect of the Vessel which the
       Lessor has agreed in the Relevant Lease Documents to give
       on sale of the Vessel) Liens referred to in the proviso to
       that Clause;

              "LIABILITY" shall have the meaning attributed to that term
       in Clause 25.1(a);

              "LIABILITY INSURANCES" means the insurances described in
       Clause 9.1(a)(ii);

              "LIBID" in relation to a particular amount for a
       particular period, means LIBOR for the amount and period
       LESS zero point one two five per cent (0.125%);

              "LIBOR" means, in relation to a particular period:

                     (i) the offered rate for deposits of Sterling
       for a period equal to such period at or about 11.00 a.m.
       (London time) on the first day of such period as displayed
       on Telerate page 3750 (British Bankers' Association
       Interest Settlement Rates) or such other page as may
       replace page 3750 on such system or on any other system of
       the information vendor for the time being designated by
       the British Bankers' Association to calculate British
       Bankers' Association's Interest Settlement Rate (as
       defined in the British Bankers' Association's Recommended
       Terms and Conditions dated 5th August, 1985); or

                     (ii) if on such date no such rate as is mentioned in
              paragraph (i) above is displayed, LIBOR for such
              period shall be the arithmetic mean (rounded
              upwards if necessary to five decimal places) of the
              rates respectively quoted to the Bank by each of
              the Reference Banks at the request of the Bank (or,
              if not all the Reference Banks provide a quotation
              when requested, the arithmetic mean of the rates
              which are quoted) as such Reference Banks' offered
              rates for deposits of Sterling in an amount
              approximately equal to the amount in relation to
              which LIBOR is to be determined for a period
              equivalent to such period to prime banks in the
              London Inter-bank Market at or about 11.00 a.m.
              (London time) on the first day of such period; or

                     (iii) if on such date no such rate can be ascertained
              pursuant to either paragraph (i) or paragraph (ii)
              of this definition, LIBOR for such period shall be
              the rate, determined by the Lessor at which the
              Bank would be able to obtain deposits of Sterling
              in an amount approximately equal to the amount in
              respect of which LIBOR is to be determined, from
              whatever source it may reasonably select for a
              period equivalent to such period at or about 11.00
              a.m. (London time) on the first day of such period;

              "LIEN" means any right of ownership, security, retention
       of title, right of possession or detention, mortgage,
       charge, lien, pledge, encumbrance, lease or other
       bailment, assignment, statutory right in rem,
       hypothecation, attachment, levy, claim, detention,
       proceeding or set-off (other than any right of set-off
       arising in favour of a banker by operation of law which
       has not been exercised) or any agreement or arrangement
       having the effect of creating a security interest or any
       other encumbrance or security interest whatsoever,
       howsoever and wheresoever created or arising;

              "LONDON BUSINESS DAY" means a day on which dealings in
       Sterling deposits are carried on in the London Inter-Bank
       Market and (other than a Saturday or Sunday, or holiday
       scheduled by law) on which banks are open for business in
       the City of London;

              "LOSSES" shall have the meaning attributed to that term in
       Clause 25.1(a) and "LOSS" shall be construed accordingly;

              "LOSS PAYABLE CLAUSE" means the provisions regulating the
       recipient of payment of sums recoverable under the Hull
       Insurances in respect of the Vessel which are to be
       incorporated in the relevant insurance documents, such
       Loss Payable Clause to be in the form of Schedule 7 or in
       such other forms as may from time to time be required in
       writing by the Lessor;

              "MATERIAL SUBSIDIARY (US)" means any Subsidiary (US) whose
       gross assets or net assets represent 10% or more of the
       consolidated gross assets or consolidated net assets
       respectively of the Guarantor's Group;

              "MONTH" or "MONTH" means a period beginning in one
       calendar month and ending in the next succeeding (or
       stipulated following) calendar month on the day
       numerically corresponding to the day of the calendar month
       on which it started, provided that (i) if the period
       started on the last Business Day in a calendar month or if
       there is no numerically corresponding day, it shall end on
       the last Business Day in such next calendar month and (ii)
       if such numerically corresponding day is not a Business
       Day, the period shall end on the preceding Business Day
       and "MONTHS" and "MONTHLY" shall be construed accordingly;

              "MORATORIUM" shall have the meaning attributed to that
       term in Clause 23.3;

              "NEW SCHEDULE 2, PART A" means each new Part A of Schedule
       2 substituted for the then existing Part A of Schedule 2
       in accordance with Clause 22.5 (Security Provision);

              "NON-DEPOSIT BANK CASH ADDITIONAL SECURITY" means any
       Additional Security other than the Additional Security
       described in Clause 22.3(b);

              "NOTICE" shall have the meaning attributed to that term in
       Clause 31.6;

              "NOVATION AGREEMENT" means the agreement entered or to be
       entered into between the Builder, the Lessee and the
       Lessor pursuant to which the Original Shipbuilding
       Contract is further amended and novated by the Lessee in
       favour of the Lessor;

              "OFE" shall have the meaning attributed to that term in
       the Shipbuilding Contract;

              "OFE SUPERVISION AGREEMENT" means the agreement entered or
       to be entered into between the Builder and GMIDC with
       respect to the supervision by GMIDC of the provision of
       the OFE.

              "OFE SUPPLIERS" shall have the meaning attributed to that
       term in the Novation Agreement;

              "ORIGINAL CURRENCY" shall have the meaning attributed to
       that term in Clause 31.12;

              "ORIGINAL SHIPBUILDING CONTRACT" means the agreement for
       the construction of the Vessel dated 27th February 1998
       between the Builder and GMIDC as amended and novated
       pursuant to a novation agreement of even date to this
       Agreement made between the Builder, GMIDC and the Lessee
       and including, without limitation, all plans, technical
       drawings and specifications relating thereto;

              "OTHER CURRENCY" shall have the meaning attributed to that
       term in Clause 31.12;

              "PAYMENT AGREEMENTS" means, together, the CIBC Payment
       Agreement and the Commerzbank Payment Agreement and
       "PAYMENT AGREEMENT" means either of them;

              "PAYMENT BANK EVENT OF DEFAULT" means, in relation to a
       Payment Bank, any of the following:

                     (i) the failure by such Payment Bank to pay any amount
              due under the Payment Agreement to which such
              Payment Bank is a party; or

                     (ii) an Insolvency Event occurs in relation to such
              Payment Bank; or

                     (iii) an event occurs which, with the giving of notice,
              the lapse of time, the making of any determination
              or any combination of any number of these three
              would, in the opinion of the Lessor, constitute an
              Insolvency Event in relation to such Payment Bank;

              "PAYMENT BANKS" means, together, Commerzbank and CIBC and
       "PAYMENT BANK" means either of them or, where the context
       requires, shall mean a Replacement Payment Bank (as such
       term is defined in either Payment Agreement);

              "PAYMENT BANKS INTEREST ACCRUAL" means, for the Relevant
       Date in any Calculation Period, the amount shown for that
       Calculation Period in the column headed "Payment Banks
       Interest Accrual" in Part A of Schedule 2 calculated in
       accordance with the provisions of clause 3 of each Payment
       Agreement;

              "PAYMENT BANKS LIMIT" means, for any Calculation Period,
       the highest amount shown in Part A of Schedule 2 against
       any date set out in that schedule which falls within that
       Calculation Period, Provided that for this purpose the
       date on which that Calculation Period ends shall be deemed
       not to fall within that Calculation Period;

              "PAYMENT BANKS PRINCIPAL BALANCE" means, for the Relevant
       Date in any Calculation Period, the amount shown for that
       Calculation Period in the column headed "Payment Banks
       Principal Balance" in Part A of Schedule 2; 

              "PERMITTED LIEN" means:

                     (i) any Lien created by the Lessee in favour of the
              Lessor as security for the Lessee's obligations
              under this Agreement;

                     (ii) any Lessor's Lien;

                     (iii) any Lien for Taxes either not yet assessed or,
              if assessed, not yet due and payable or being
              contested in good faith by appropriate proceedings
              (and for the payment of which adequate reserves
              have been provided) so long as any such proceedings
              or the continued existence of such Lien do not
              involve any reasonable likelihood of the sale,
              forfeiture or loss of, or of any interest in, the
              Vessel (or any part thereof);

                     (iv) Liens arising out of claims, judgments or awards
              against the Lessee which are being contested in
              good faith or which are subject to a pending appeal
              and for which there shall have been granted a stay
              of execution pending such appeal and for the
              payment of which adequate reserves have been
              provided so long as any such proceedings do not
              involve any reasonable likelihood of the sale,
              forfeiture or loss of, or of any interest in, the
              Vessel (or any part thereof);

                     (v) any Lien for salvage and any ship repairer's or
              outfitter's possessory lien in each case for a sum
              not exceeding an amount equal to ten per cent.
              (10%) of the Lessor's Cost or the equivalent in any
              other currency or any lien for general average or
              for officers' or crew's wages not more than ten
              (10) Business Days outstanding in the ordinary
              course of trading which in each case is not yet due
              and payable or is being contested in good faith by
              appropriate proceedings (and for the payment of
              which adequate reserves have been provided) so long
              as any such proceedings or the continued existence
              of such Lien do not involve any reasonable
              likelihood of the sale, forfeiture or the loss of,
              or of any interest in, the Vessel (or any part
              thereof);

                     (vi) any Lien created by the Lessor or any other
              person under and as permitted by any Relevant Lease
              Document;

                     (vii) any other Lien, the creation of which has been
              expressly permitted in writing by the Lessor;

                     (viii) any Lien arising by operation of law or by
              any contractual right of set-off, in each case in
              the ordinary course of the business of the Lessee
              in respect of amounts which are not overdue; and

                     (ix) any Lien in respect of claims which the Lessee
              demonstrates to the Lessor's satisfaction are then
              covered by the Insurances, provided that there is
              no reasonable likelihood of the sale or forfeiture
              or loss of, or of any interest in, the Vessel (or
              any part thereof);

              "PLA COSTS" means the percentage rate determined in
       accordance with Annex A to the Financial Schedule;

              "PRE-LEASE PERIOD" means the period from the date of this
       Agreement up to the Delivery Date;

              "PRIMARY PERIOD" means the period commencing on the
       Delivery Date to and including the Primary Period End
       Date, or such shorter period as may be determined in
       accordance with the provisions of this Agreement;

              "PRIMARY PERIOD END DATE" means the twentieth (20th)
       anniversary of the Delivery Date;

              "PRIMARY PERIOD RENT" means each instalment of Rent in the
       amount determined pursuant to paragraph 1.1 of the
       Financial Schedule, as adjusted from time to time pursuant
       to the provisions of the Financial Schedule;

              "PROCEEDS OF SALE" shall have the meaning attributed to
       that term in Clause 20.1;

              "PROVIDER OF SECURITY" means each of the Payment Banks,
       the Deposit Bank or any Additional Security Provider who
       the Lessor agrees in writing shall be a "PROVIDER OF
       SECURITY" for the purposes of this Agreement and the other
       Relevant Lease Documents;

              "PUT OPTION DEED" means the put option deed entered into
       or, as the context may require, to be entered into in or
       about the date of this Agreement between the Lessor, the
       Sub-Lessee and the Builder;

              "RATE OF EXCHANGE" shall have the meaning attributed to
       that term in Clause 31.12;

              "REBATE" shall have the meaning attributed to that term in
       Clause 26.5(b);

              "REDELIVERY LOCATION" means a port acceptable to the
       Lessor and, otherwise than on a redelivery following
       service of a Termination Notice, agreed by the Lessee;

              "REFERENCE BANKS" means the principal London offices of
       each of National Westminster Bank Plc, Lloyds Bank Plc,
       Barclays Bank PLC and Midland Bank PLC;

              "RELEVANT DATE" means any date within a Calculation Period
       designated by the Lessor as a "RELEVANT DATE" and set out
       in the column headed "RELEVANT DATE" in Part A of
       Schedule 2;

              "RELEVANT DISPOSAL" shall have the meaning attributed to
       that term in Clause 28.1;

              "Relevant Event" means any Termination Event or any event
       which, after the giving of notice or lapse of time or
       both, or the satisfaction of any other condition (or any
       combination thereof), would constitute a Termination
       Event;

              "RELEVANT LEASE DOCUMENTS" means this Agreement, the
       Novation Agreement, the Construction Supervision
       Agreement, the Put Option Deed, the Contribution Deed, the
       Payment Agreements, the Side Letters, the Guarantee, the
       First Deposit Deed, the Second Deposit Deed and any
       documents creating or constituting any Additional Security
       and any other document, notice, letter or instrument
       entered into, issued or given pursuant to the terms of any
       of the foregoing and any other document, notice, letter or
       instrument designated as a Relevant Lease Document by the
       Lessor and the Lessee;

              "RELEVANT MEMBER" means any member of the Lessor's Group
       other than the Lessor;

              "REMAINING OBLIGATIONS" means the obligations of the
       Lessee or the Guarantor under each Relevant Lease Document
       other than Excluded Obligations;

              "RENT" means any or all (as the context requires) of the
       Primary Period Rent, the Secondary Period Rent and any
       other sum (including any Termination Rent or Termination
       Payment) payable by the Lessee pursuant to this Agreement
       which is expressed to be by way of Rent or additional
       Rent;

              "RENT DATE" means each Rent Payment Date and, prior to the
       Delivery Date, each date which is assumed for the purposes
       of the latest Revised Cash Flow Report to be a Rent
       Payment Date and each date on which any additional Rent is
       payable;

              "RENT LIMIT" shall have the meaning attributed to that
       term in Clause 23.1(a);

              "RENT PAYMENT DATE" shall have the meaning attributed to
       that term in the Financial Schedule;

              "REPLACEMENT DEPOSIT BANK" means any Deposit Bank other
       than the Bank;

              "REQUISITION COMPENSATION" means all sums of money or
       other compensation from time to time payable in respect of
       the Compulsory Acquisition of the Vessel;

              "RESTRICTED ACCESS" in relation to any moneys at any time
       standing to the credit of an Account, means either:

                     (a) the security constituted by the relevant Deposit
              Deed is found or held to be invalid, illegal or
              unenforceable for (subject as provided below) any
              reason whatsoever, including by reason of the
              occurrence of an Insolvency Event in relation to
              the Lessee or any other person; or

                     (b) immediate access to such moneys is denied for
              (subject as provided below) any reason whatsoever
              including by reason of the occurrence of an
              Insolvency Event in relation to the Lessee or any
              other person,

              Provided that there shall be deemed to be excluded:

                     (i) from paragraph (a), any invalidity, illegality or
              unenforceability which would not have arisen but
              for, and only but for, the occurrence of an
              Insolvency Event in relation to the Deposit Bank or
              the relevant Payment Bank; and

                     (ii) from paragraph (a), any invalidity, illegality or
              unenforceability which would not have arisen but
              for, and only but for, the Deposit Bank being a
              Replacement Deposit Bank and such invalidity,
              illegality or unenforceability would not have been
              caused or would not have arisen had the Deposit
              Bank been the Bank; and

                     (iii) from paragraph (b), any limit on access to such
              moneys which would not have arisen but for, and
              only but for, (1) the occurrence of an Insolvency
              Event in relation to the Deposit Bank or the
              relevant Payment Bank, (2) a claim against the
              Deposit Bank or the relevant Payment Bank unless
              that claim (aa) is made against the Deposit Bank in
              its capacity as holder of the First Account or the
              Second Account, (bb) relates to any of the Relevant
              Lease Documents or the financing arrangements
              contemplated thereby or (cc) is brought by the
              Lessee or any person associated (within the meaning
              of section 839 ICTA 1988) with the Lessee or (3) a
              default in payment by the Deposit Bank in
              accordance with the terms of the relevant Deposit
              Deed where such default would not have arisen but
              for, and only but for, the breach by the Deposit
              Bank of its express obligations under such relevant
              Deposit Deed other than any such breach which is
              caused by or arises as a result of (aa) the
              circumstances described in paragraph (a) or (b)
              (subject to the provisos in paragraphs (i), (ii)
              and (iii), or (bb) a breach by any Security Party
              of any of its obligations under the Relevant Lease
              Documents;

              "REVISED CASH FLOW REPORT" shall have the meaning
       attributed to that term in the Financial Schedule;

              "REVISED STRIP LIMIT" means, with respect to each of the
       Guarantor Credit Event Cure Dates referred to in Clause
       22.2(c), the Strip Limit which would have applied on such
       Guarantor Credit Event Cure Date but for, and only but
       for, the occurrence of a Guarantor Credit Event;

              "RISK ASSET WEIGHTING" shall have the meaning attributed
       to that term in the Financial Schedule;

              "RPI" shall have the meaning attributed to that term in
       the Financial Schedule;

              "SAFETY MANAGEMENT CERTIFICATE" shall have the meaning
       attributable to that term in the ISM Code;

              "SAFETY MANAGEMENT SYSTEM" shall have the meaning
       attributable to that term in the ISM Code;

              "SECOND ACCOUNT" means the account number 1012334 entitled
       "Global Marine Leasing Corporation: Glomar C.R. Luigs
       Number Two Account" opened by the Lessee with the Deposit
       Bank to which the Lessee may from time to time be obliged
       to credit moneys pursuant to the provisions of this
       Agreement and the Second Deposit Deed;

              "SECOND ACCOUNT INTEREST ACCRUAL" means, for the Relevant
       Date in any Calculation Period, the amount shown for that
       Calculation Period in the column headed "Second Account
       Interest Accrual" in Part A of Schedule 2 calculated in
       accordance with the provisions of clause 3 of the Second
       Deposit Deed;

              "SECOND DEPOSIT DEED" means the deed so entitled, entered
       into or, as the context may require, to be entered into on
       or about the date of this Agreement between the Lessee,
       the Lessor and the Deposit Bank in relation to the Second
       Account;

              "SECOND INSTALMENT" means the aggregate amount paid or, as
       the context may require, payable by the Lessor (i) to the
       Lessor's Agent pursuant to clause 5.1 of the Construction
       Supervision Agreement and (ii) to the Builder pursuant to
       the Shipbuilding Contract on the date upon which the
       instalment of the Total Vessel Cost becomes due under
       clause 8.3.4 of the Shipbuilding Contract;

              "SECONDARY PERIOD" means each period for which the leasing
       of the Vessel under this Agreement is extended in
       accordance with Clause 6.2;

              "SECONDARY PERIOD RENT" means each instalment of Rent in
       the amount determined pursuant to paragraph 1.2 of the
       Financial Schedule;

              "SECURITY PARTY" means each party to a Lease Document
       (other than the Lessor, the Deposit Bank, the Payment
       Banks and any Additional Security Provider who is NOT a
       member of the Guarantor's Group and who the Lessor agrees
       in writing shall be a "SECURITY PARTY" for the purposes of
       this Agreement and the other Relevant Lease Documents);

              "SERVICE CONTRACT" means the agreement to be entered into
       between the Sub-Lessee and the Initial Service Contractor
       and any further service contract or contracts for the
       Vessel entered into by the Lessee and a Service Contractor
       and under which the Service Contractor may direct the
       operations of the Vessel;

              "SERVICE CONTRACTOR" means the Initial Service Contractor
       or any other person who is entitled to direct the
       operations of the Vessel under the terms of a Service
       Contract;

              "SETTLEMENT DATE" means the earlier of:

                     (i) the first Business Day which falls after the date
              which falls one hundred and eighty (180) days after
              the Date of Total Loss; and

                     (ii)   the date on which the Total Loss Proceeds in
              respect of the Total Loss are received by the
              Lessor;

              "SHIPBUILDING CONTRACT" means the Original Shipbuilding
       Contract as amended and novated by the Novation Agreement;

              "SIDE LETTERS" means each of the letters issued or, as the
       context may require, to be issued on or about the date of
       this Agreement by the Lessor which (i) is entitled rate of
       writing down allowances (from the Lessor to the Lessee),
       (ii) is entitled indexation letter (from the Lessor to the
       Lessee), (iii) is entitled tax consultation (from the
       Lessor to the Lessee), (iv) is entitled deemed schedules
       (from the Lessor to the Lessee), (v) is entitled insurance
       side letters from the Lessor's Agent to the Lessor,
       (vi) relates to certain standby purchaser arrangements
       (between the Lessor, the Guarantor and the Lessee) and
       (vii) is entitled arrangement fee (from the Lessor to
       Atlas Oceanic Limited);

              "SLV" means, for any Calculation Period, the Termination
       Payment calculated for the Relevant Date falling within
       that Calculation Period by the Lessor in accordance with
       the provisions of paragraph 4 of the Financial Schedule
       and which is shown in the column headed "SLV" in Part A of
       Schedule 2;

              "STERLING" and "POUNDS-STERLING" and "POUNDS" mean the
       lawful currency for the time being of the United Kingdom
       and in respect of all payments to be made under this
       Agreement in Sterling means immediately available, freely
       transferable cleared funds in Sterling;

              "STERLING EQUIVALENT" of any amount denominated in a
       currency other than Sterling on any date means the
       equivalent in Sterling of such amount calculated by
       converting such amount into Sterling at the rate certified
       by the Lessor as being the spot rate of exchange for
       purchasing Sterling with such currency quoted by the Bank
       at or about 11.00 a.m. (London time) two (2) London
       Business Days prior to such date for delivery on such
       date;

              "STRIP AMOUNT" means, in respect of any date, the SLV for
       the Calculation Period in which that date falls less the
       aggregate of the Value of all Termination Security
       calculated for that date and set out in the column headed
       "STRIP AMOUNT" in Part A of Schedule 2;

              "STRIP LIMIT" means, for any Calculation Period, the
       amount set out in the column headed "STRIP LIMIT" in Part
       A of Schedule 2 opposite such Calculation Period;

              "SUB-LEASE" means any lease or charter agreement entered
       or, as the context may require, to be entered into between
       the Lessee and the Sub-Lessee providing for, inter alia,
       the leasing or chartering of the Vessel by the Lessee to
       the Sub-Lessee and more particularly described in Clause
       30(A);

              "SUB-LESSEE" means Global Marine C.R. Luigs Limited, a
       company incorporated under the laws of England whose
       registered office is at 15 Appold Street, London EC2A 2HB,
       England or any other member of the Guarantor's Group or
       any other person permitted to sub-lease or sub-charter the
       Vessel in accordance with the provisions of Clause 30(A);

              "SUBSIDIARY" means any subsidiary within the meaning of
       section 736 of the Companies Act 1985;

              "SUBSIDIARY (US)" means a corporation more than 50% of the
       outstanding voting stock of which is owned, directly or
       indirectly, by the Guarantor or by one or more other
       Subsidiaries (US), or by the Guarantor and one or more
       other Subsidiaries (US).  For the purposes of this
       definition, "voting stock" means stock that ordinarily has
       voting power for the election of directors, whether at all
       times or only so long as no senior class of stock has such
       voting power by reason of any contingency.  A Joint
       Venture shall not be a Subsidiary (US);

              "SURVIVING PARTS" in the event of a Total Loss of the
       Vessel means those spares and other parts comprising part
       of the Vessel which survive that Total Loss, whether
       through being stored ashore or otherwise;

              "TAX" means all present and future taxes, charges,
       imposts, duties, levies of any kind whatsoever (whether
       levied by deduction, withholding or otherwise), or any
       amount payable on account of or as security for any of the
       foregoing, payable at the instance of or imposed by any
       statutory, governmental, international, state, federal,
       provincial, local or municipal authority, agency, body or
       department whatsoever or any central bank, monetary agency
       or European Union institution, in each case whether in the
       United Kingdom or elsewhere, together with any penalties,
       additions, fines, surcharges or interest relating thereto
       and "TAXES", "TAXATION" and cognate expressions shall be
       construed accordingly;

              "TAX LIABILITY" means in respect of any person:

                     (i) any liability or any increase in the liability of
              that person to make any payment or payments of or
              in respect of Tax;

                     (ii) the loss or setting off against income, profits or
              gains or against any liability to make a payment or
              payments of or in respect of Tax of any relief,
              allowance, deduction or credit ("RELIEF") which
              would otherwise have been available to that person;
              and

                     (iii) the loss or setting off against any liability to
              make a payment or payments of or in respect of Tax
              of a right to repayment of Tax which would
              otherwise have been available to that person;

              and in any case falling within (ii) or (iii) above the
       amount that is to be treated as a Tax Liability shall be
       determined as follows:

                     (a) in a case which falls within (ii) above and where
              the Relief that was the subject of the loss or
              setting off was or would have been a deduction from
              or offset against Tax, the Tax Liability shall be
              the amount of that Relief;

                     (b) in a case which falls within (ii) above and which
              involves the loss of a Relief which would otherwise
              have been available as a deduction from or offset
              against gross income, profits or gains the Tax
              Liability shall be the amount of Tax which would
              (on the basis of the Tax rates current at the date
              of the loss and assuming that the person has
              sufficient gross income, profits or gains to
              utilise the Relief) have been saved but for the
              loss of the Relief;

                     (c) in a case which falls within (ii) above and which
              involves the setting off of a Relief which would
              otherwise have been available as a deduction from
              or offset against gross income, profits or gains,
              the Tax Liability shall be the amount of Tax which
              has been or will be saved in consequence of the
              setting off;

                     (d) in a case which falls within (iii) above, the Tax
              Liability shall be the amount of the repayment that
              would have been obtained but for the loss or
              setting off.

              For the purposes of this definition any question of
       whether or not any relief, allowance, deduction, credit or
       right to repayment of tax has been lost or set off, and if
       so, the date on which that loss or set-off took place,
       shall be conclusively determined by the Lessor;

              "TAX WRITTEN DOWN VALUE" shall have the meaning attributed
       to that term in the Financial Schedule;

              "TECHNICAL RECORDS" means all technical data, manuals, log
       books, records and other materials and documents (kept or
       to be kept for the Vessel in compliance with any
       applicable law or regulation of the Flag State or of any
       regulatory authority, government entity or international
       body or treaty organisation from time to time) and all
       additions, renewals, revisions and replacements from time
       to time made in accordance with this Agreement;

              "TERMINATION DATE" means:

                     (a) the Lease Period End Date; or

                     (b) where the leasing of the Vessel to the Lessee or,
              if Delivery has not occurred, the obligation of the
              Lessor to lease the Vessel to the Lessee, pursuant
              to this Agreement terminates by virtue of a Total
              Loss under Clause 10 of this Agreement, the Date of
              Total Loss; or

                     (c) where the leasing of the Vessel to the Lessee or,
              if Delivery has not occurred, the obligation of the
              Lessor to lease the Vessel to the Lessee, pursuant
              to this Agreement terminates by reason, in either
              case, of the delivery by the Lessor of a
              Termination Notice pursuant to Clause 21.3
              following the occurrence of any Termination Event,
              the date of the Termination Notice; or

                     (d) where the leasing of the Vessel or, if Delivery has
              not occurred, the obligation of the Lessor to lease
              the Vessel to the Lessee pursuant to this Agreement
              terminates by reason of the voluntary termination
              of the leasing of the Vessel under this Agreement
              pursuant to Clause 6.4 or 21.4 of this Agreement,
              the date upon which the notice given by the Lessee
              in accordance with Clause 6.4 or, as the case may
              be, 21.4 expires;

              "TERMINATION EVENT" means any of the events listed in
       Clause 21.1;

              "TERMINATION LIMIT" shall have the meaning attributed to
       that term in Clause 23.1(b);

              "TERMINATION NOTICE" has the meaning attributed to that
       term in Clause 21.3;

              "TERMINATION PAYMENT" shall have the meaning attributed to
       that term in paragraph 4.2 of part 4 of the Financial
       Schedule;

              "TERMINATION PAYMENT DATE" means, (i) in the case of a
       termination pursuant to Clause 10, the Settlement Date
       and, (ii) in any other case, the relevant Termination
       Date;

              "TERMINATION RENT" means an amount calculated in
       accordance with paragraph 4.3 of the Financial Schedule;

              "TERMINATION SECURITY" at any time, means the aggregate
       of:

              (a) the Payment Banks Principal Balance; 

              (b) the Payment Banks Interest Accrual;

              (c) the First Account Principal Balance;

              (d) the First Account Interest Accrual; and

              (e) all Additional Security held by the Lessor at that
       time;

              "TERMINATION SHORTFALL" means, for any date falling within
       a Calculation Period, the amount (if any) by which the
       Strip Amount for that date exceeds the Strip Limit for
       that date;

              "TOTAL LOSS" means:

                     (a) the actual or constructive or agreed or compromised
              or arranged total loss of the Vessel; or

                     (b) the Compulsory Acquisition of the Vessel; or

                     (c) the hijacking, theft, condemnation, capture,
              seizure, arrest, detention, forfeiture or
              confiscation of the Vessel (other than where the
              same amounts to Compulsory Acquisition of the
              Vessel), unless the Vessel be released and restored
              to the Lessee from such hijacking, theft,
              condemnation, capture, seizure, arrest, detention
              or confiscation within one hundred and eighty (180)
              days after the occurrence thereof,

              "TOTAL LOSS PROCEEDS" in relation to the Vessel means any
       compensation or insurance proceeds received by the Lessor
       in respect of a Total Loss of the Vessel which the Lessor
       is, as against the payer thereof, unconditionally entitled
       to retain;

              "TOTAL VESSEL COST" shall have the meaning attributed to
       that term in the Shipbuilding Contract;

              "US 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;

              "VALUE" means, as calculated at any time in relation to a
       particular date, the aggregate value of any security then
       held by the Lessor being:

                     (a) in respect of the security constituted by the
              undertakings of the Payment Banks under the Payment
              Agreement for the purposes of Termination Security,
              the amount which would (following a demand under
              Clause 5.4 of each of the Payment Agreements) be
              payable by the Payment Banks on that date under
              Clause 5.7 of each of the Payment Agreements
              (ignoring for these purposes the provisions of
              clauses 4.1, 4.6 and 5.7 of each of the Payment
              Agreements entitling the relevant Payment Bank to
              make any deduction or withholding from such amount
              which would be payable) being an amount equal to
              the aggregate of the Payment Banks Principal
              Balance and the Payment Banks Interest Accrual (at
              the time of calculation), less, in each such case,
              the aggregate of (A) the amount, if any, of any
              withholding or deduction which the Payment Banks
              are or will be entitled to make from any payment
              under the Payment Agreements and (B) any amount
              which, by virtue of invalidity, illegality or
              unenforceability, either Payment Bank is relieved
              from its obligation to make any payment under the
              relevant Payment Agreement (other than by virtue of
              invalidity, illegality or unenforceability which
              would not have arisen but for, and only but for,
              the occurrence of an Insolvency Event in relation
              to a Payment Bank), Provided that if the value
              allocated pursuant to this paragraph (a) would, but
              for this proviso, exceed the Payment Bank Limit for
              the Calculation Period in which the relevant date
              occurs, such value shall instead be deemed to be
              the Payment Bank Limit for the Calculation Period
              in which that date occurs;

                     (b) in respect of cash deposited in either Account,
              the principal amount originally deposited in that
              Account together with all further amounts deposited
              in that Account prior to the time of calculation
              plus (i) interest at LIBID credited or which (but
              for a default on the part of the Deposit Bank in
              performance of its obligations under the Second
              Deposit Deed) ought to have been so credited for
              any period for which LIBID is known being an amount
              equal to the aggregate of the First Account
              Interest Accrual and the Second Account Interest
              Accrual (at the time of calculation) and (ii) for
              any future period up to that date for which LIBID
              cannot (at the date of valuation) be ascertained,
              interest credited or to be credited to the Second
              Account in accordance with the Second Deposit Deed
              at a reasonable annual market rate less (aa) the
              amount of any transfer (prior to that date) from
              that Account made in accordance with the provisions
              of the relevant Deposit Deed and less (bb) the
              amount of any withholding or deduction which the
              Deposit Bank is or will be entitled to make from
              any payment under the terms of the relevant Deposit
              Deed and less (cc) any amounts in respect of which
              there is (at the time of calculation) Restricted
              Access, provided that (1) all interest calculations
              made for the purpose of this definition shall be
              made in accordance with the provisions of the
              relevant Deposit Deed on the basis of the actual or
              assumed future daily balances taking into account
              any additional amounts credited to the relevant
              Account and any withdrawals from that Account in
              accordance with the relevant Deposit Deed, (2) all
              payments to be made by the Payment Banks to either
              Account shall be deemed to be made when due and (3)
              the amount calculated under this paragraph (b)
              shall, if negative, be deemed to be zero;

                     (c) the Strip Limit for that particular date; and

                     (d) in respect of any Additional Security not falling
              within paragraphs (a), (b) and (c) above, such
              value as the Lessor shall allocate acting
              reasonably given the type of such Additional
              Security, the Lessor's access to it and the
              provisions of any applicable law (including,
              without limitation, in relation to withholdings and
              deductions);

              "VALUE ADDED TAX" or "VAT" means value added tax as
       provided for in VATA and legislation (whether delegated or
       otherwise) supplemental thereto or in any primary or
       subordinate legislation promulgated by the European Union
       or any body or agency thereof and any tax similar or
       equivalent to value added tax imposed by any country other
       than the United Kingdom and any similar or turnover Tax
       replacing or introduced in addition to any of the same;

              "VATA" means the Value Added Tax Act 1994; and

              "VESSEL" means:

                     (a) for the period up to the Primary Period Start
              Date, the ultra-deepwater drillship with the Builder's
              hull number 1739 currently being constructed by the
              Builder and more particularly described in the
              specification to the Shipbuilding Contract; and
                     
                     (b) on and after the Primary Period Start Date, the
              motor driven ultra-deepwater drillship of 53,000
              operating displacement tonnage having hull number
              1739 and to be registered under the Panamanian flag
              with the name "GLOMAR C.R. LUIGS" and includes any
              share or interest therein and all engines,
              machinery, boats, tackle, outfit, equipment, spare
              gear, belongings and appurtenances relating to that
              Vessel which are at the relevant time the property
              of the Lessor whether on board or ashore (but
              excluding, where the context so requires, all
              Excluded Property) together with all substitutions,
              replacements and renewals thereof and additions
              thereto from time to time made in or to the Vessel
              and where the context so permits "Vessel" includes
              any part thereof and all Technical Records relating
              to the Vessel.

1.2    INTERPRETATION

                     (a) The expression "THIS AGREEMENT" includes the
              recital hereto and each schedule as the same may
              from time to time be amended, supplemented or
              substituted by agreement of the parties hereto.

                     (b) In this Agreement references to:

                              (i) clauses, paragraphs, sub-paragraphs and
                     schedules are, unless otherwise specified,
                     references to clauses, paragraphs, sub-
                     paragraphs of, and schedules to, this
                     Agreement, or the relevant part thereof, as
                     from time to time amended, supplemented or
                     substituted in accordance with the
                     provisions of this Agreement;

                               (ii) without prejudice to Clause 1.2(c)(i),
                     any statute or other legislative provision
                     shall, unless otherwise specified, be read
                     to include any statutory or legislative
                     modification or re-enactment thereof, or
                     substitution therefor;

                                (iii) any agreement or instrument shall
                     include such agreement or instrument as it may from
                     time to time be extended, amended,
                     supplemented, novated or substituted with
                     the agreement of the parties thereto and,
                     where this Agreement and such agreement
                     expressly so provides, the parties hereto;

                                 (iv) "PERSON" shall include any individual,
                     company, corporation, firm, partnership,
                     joint venture, association, trust,
                     unincorporated organisation or government or
                     state (including any agency, department or
                     political sub-division thereof) whether
                     having distinct legal personality or not;

                                 (v) "ASSIGNEE" or "ASSIGNEES" 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 and, other than in the case of
                     the Bank, its permitted assignees and
                     permitted transferees in accordance with
                     their respective interests;

                                 (vii) the "ASSETS" of any person shall be
                     construed as a reference to the whole or any
                     part of its business, undertaking, property,
                     assets and revenue (including any right to
                     receive revenues);

                                 (viii) "INDEBTEDNESS" shall be construed
                     so as to include any obligation (whether
                     incurred as principal or as surety) for the
                     payment or repayment of money, whether
                     present or future, actual or contingent;

                                 (ix) the "WINDING-UP", "DISSOLUTION" or
                     "ADMINISTRATION" of a company or corporation
                     shall be construed so as to include any
                     equivalent or analogous proceedings under
                     the law of the jurisdiction in which such
                     company or corporation is incorporated or
                     any jurisdiction in which such company or
                     corporation carries on business including
                     the seeking of liquidation, winding-up,
                     reorganisation, dissolution, administration,
                     arrangement, adjustment, protection or
                     relief of debtors;

                                  (x) words importing the plural include the
                     singular and vice versa;

                                  (xi) a "LAW" (1) includes any common law,
                     statute, decree, constitution, regulation,
                     order, judgment or directive of any
                     governmental entity; (2) includes any
                     treaty, pact, compact or other agreement to
                     which any government entity is a signatory
                     or party; (3) includes any judicial or
                     administrative interpretation or application
                     thereof and (4) is a reference to that
                     provision as amended, substituted or
                     re-enacted; and

                                  (xii) a document being in the "AGREED FORM"
                     shall be read and construed as referring to such
                     document in the form thereof which has been
                     initialled for identification purposes by
                     the parties hereto or their respective legal
                     counsel on their behalf.

                     (c) In the Financial Schedule, references to parts,
              paragraph and annexes are, unless otherwise stated,
              references to parts and paragraphs of, and annexes
              to, the Financial Schedule as from time to time
              amended, supplemented or substituted, and:

                                 (i) references to statutory provisions are
                     to statutory provisions as at the date of this
                     Agreement and, to that extent, Clause
                     1.2(b)(ii) shall not apply to the Financial
                     Schedule; and

                                 (ii) any references to the occurrence of an
                     event  shall include a reference to the failure of
                     an assumed event to occur.

                     (d) Clause and other headings are for ease of reference
              only and shall not affect the interpretation of
              this Agreement.

1.3    CONFLICTS

              In the event of any conflict between this Agreement and
       any of the other Lease Documents, the provisions of this
       Agreement shall prevail.

1.4    DETERMINATIONS
       
                  (a) Any reference to the timing or amount of any
              payment to be made or received, or assumed to be
              made or received, by the Lessor or to the making of
              any determination, calculation or quantification
              under this Agreement (each a "DETERMINATION" and
              "DETERMINE" shall be construed accordingly) shall
              be construed as a reference to such Determination
              as determined by the Lessor in accordance with this
              Agreement.

                  (b) If requested in writing by the Lessee, the Lessor
              shall provide the Lessee with written details
              (including any relevant calculations) of any
              Determination made in connection with this
              Agreement (for the avoidance of doubt Clause 32
              (Confidentiality) of this Agreement shall apply to
              all information disclosed in accordance with this
              paragraph).

                     (c) Subject to paragraph 3.15 of the Financial
              Schedule, the Lessor shall be entitled (but not
              obliged) to make a Determination that any
              Assumption (including for this purpose any
              Termination Assumption) is incorrect if in good
              faith it has reasonable grounds for believing that
              a change in that Assumption will occur, but shall
              be obliged to make a Determination that a change in
              that Assumption has occurred as soon as is
              reasonably practicable after that change has
              actually occurred.

                     (d) The Lessor shall have reasonable grounds for having
              a belief that a legislative change will or is
              likely to occur if an official announcement is made
              by or on behalf of any body mentioned in the
              definition of Tax (including, for the avoidance of
              doubt, a statement by the Chancellor of the
              Exchequer) or other competent authority to that
              effect, and shall have reasonable grounds for
              having a belief that any other change will occur if
              it has obtained information from any body mentioned
              in the definition of Tax (including any challenge
              or dispute by the Inland Revenue of anything
              assumed in or contemplated by the Financial
              Schedule) or other competent authority or
              professional advice relating to that information or
              any published announcement, any practice,
              concession or judicial decision (which shall, in
              each case, be appropriate to the change in point)
              from which it appears that a change will occur.

                     (e) If the Lessee considers that:

                           (i) any Determination of the Lessor is or may
                     not be accurate or correct, the Lessee may,
                     within twenty (20) Business Days of being
                     notified of that Determination, so inform
                     the Lessor by notice in writing, giving its
                     reasons for considering it not to be
                     accurate or correct; or

                           (ii) the Lessor ought to have made a
                     Determination but has failed to do so, the
                     Lessee may so inform the Lessor by notice in
                     writing within twenty (20) Business Days of
                     the date the Lessee becomes aware of the
                     alleged omission, giving its written reasons
                     why it considers that a Determination ought
                     to have been made.

                     (f) As soon as practicable after a notification under
              Clause 1.4(e) by the Lessee, if requested in
              writing by the Lessee, the Lessor and the Lessee
              shall discuss with each other the Determination in
              question.  If the Lessor and the Lessee cannot
              agree to the correctness or otherwise of such
              Determination within a further period of twenty
              (20) Business Days of the Lessee's notice referred
              to in Clause 1.4(e) above, then both the Lessee and
              the Lessor shall be at liberty to pursue any legal
              action or proceedings;

                     (g) If the Lessor agrees that the Determination in
              question was materially inaccurate or incorrect,
              then:

                            (i) in relation to a Determination in
                     connection with a Cashflow Report, a revised Cashflow
                     Report shall be prepared in accordance with
                     the Financial Schedule, taking account of
                     the corrected Determination; or

                            (ii) in any other case, and subject to any
                     express provision in this Agreement, such
                     necessary adjustments by way of payment
                     between the Lessor and the Lessee shall be
                     made as are required in order to leave the
                     Lessor in the same after-Tax position as
                     that in which it would have been if it had
                     originally made the Determination as
                     corrected.

                     (h) The foregoing provisions of this Clause 1.4 shall
              be without prejudice to the obligations of the
              Lessee to make payment of Rent or any other payment
              pursuant to this Agreement on the due date for
              payment in the amount demanded by the Lessor in
              accordance with the Lessor's original
              Determination.

                     (i) The Lessor shall be entitled to charge for (and the
              Lessee shall so pay) for the Cost of Management
              Time in respect of any matter undertaken or
              anything done at the request of the Lessee under
              this Clause 1.4 save and to the extent the Lessor
              would have undertaken that matter in any event or
              where the Lessor's Determination is subsequently
              established to be incorrect to the detriment of the
              Lessee by more than five thousand pounds-sterling
              (5,000) of the (corrected) Determination referred to in
              Clause 1.4(g) above.


2.     REPRESENTATIONS AND WARRANTIES

2.1    REPRESENTATIONS AND WARRANTIES BY THE LESSEE

              The Lessee acknowledges that the Lessor has entered or, as
       the case may be, shall enter into the Relevant Lease
       Documents to which it is, or is to be, a party in full
       reliance on representations by the Lessee in the terms set
       out in Part 1 of Schedule 4 and the Lessee warrants to the
       Lessor that the statements made in Part 1 of Schedule 4
       are, as at the date of this Agreement, true and accurate.

2.2    REPRESENTATIONS AND WARRANTIES BY THE LESSOR

              The Lessor acknowledges that the Lessee has entered or, as
       the case may be, shall enter into the Lease Documents to
       which it is, or is to be, a party in full reliance on
       representations by the Lessor to the Lessee in the terms
       set out in Part 2 of Schedule 4 and the Lessor warrants to
       the Lessee that the statements made in Part 2 of Schedule
       4 are, as at the date of this Agreement, true and
       accurate.

2.3    REPETITION OF REPRESENTATIONS AND WARRANTIES

              The representations and warranties referred to in Clauses
       2.1 and 2.2 shall be deemed to be repeated on, and by
       reference to facts and circumstances at, each Instalment
       Date and the Delivery Date.

2.4    SURVIVAL OF REPRESENTATIONS AND WARRANTIES

              The representations and warranties referred to in Clauses
       2.1 and 2.2 and the rights of the respective parties in
       respect thereof shall survive the execution and delivery
       of this Agreement and Delivery.

2.5    NOT PREJUDICED BY THE LESSOR'S INVESTIGATION

              The rights and remedies of the Lessor in relation to any
       misrepresentation or breach of warranty on the part of the
       Lessee or the Guarantor shall not be prejudiced by any
       investigation by or on behalf of the Lessor into the
       affairs of any person (other than the Lessor), by the
       Lessor being a party to the Relevant Lease Documents, by
       the performance of any of the Lease Documents or by any
       other act or thing which may be done or omitted to be done
       by the Lessor under any of the Relevant Lease Documents
       which would or might, but for this Clause 2.5, prejudice
       such rights and remedies, other than an express written
       waiver of such rights and remedies by the Lessor.

3.     CONDITIONS PRECEDENT

3.1    LESSOR'S CONDITIONS PRECEDENT

              The obligations of the Lessor under this Agreement and the
       other Relevant Lease Documents to which it is a party
       shall be subject to the prior satisfaction in full, or
       waiver or deferral in writing by the Lessor to the extent
       not so satisfied, of the conditions precedent set out in
       Part 1 of Schedule 5.

3.2    CONDITIONS PRECEDENT TO LESSOR'S PAYMENT OBLIGATIONS

              The obligation of the Lessor to make payment of any
       Instalment and to take delivery of the Vessel pursuant to
       the terms of the Shipbuilding Contract shall be subject to
       the prior satisfaction in full, or waiver in writing by
       the Lessor to the extent not so satisfied, of the
       conditions precedent set out in Part 2 of Schedule 5.

3.3    CONDITIONS PRECEDENT TO DELIVERY

              The obligation of the Lessor to take delivery of the
       Vessel pursuant to the terms of the Shipbuilding Contract
       and to deliver the Vessel to the Lessee under Clause 4.2
       shall be subject to the prior satisfaction in full, or
       waiver in writing by the Lessor to the extent not so
       satisfied, of the conditions precedent set out in Part 3
       of Schedule 5.

3.4    WAIVER OR DEFERRAL OF CONDITIONS PRECEDENT

                    (a) If any of the conditions precedent referred to in
              Clause 3.1, Clause 3.2 or Clause 3.3 are waived or
              deferred by the Lessor, the Lessor may attach to
              such waiver or deferral such requirements and
              further or other conditions as it thinks fit, and
              the Lessee shall fulfil, or procure fulfilment of,
              all such requirements or further or other
              conditions as may be notified by the Lessor to the
              Lessee, in accordance with the terms of such
              notification.

                    (b) If the Lessor agrees to make the payment of an
              Instalment or, as the case may be, deliver the
              Vessel to the Lessee on terms (express or
              otherwise) that any condition may be fulfilled
              after the relevant Instalment Date or, as the case
              may be, the Delivery Date, the Lessee shall (unless
              the Lessor shall have expressly otherwise agreed in
              writing) procure that such condition is fulfilled
              within such period after the relevant Instalment
              Date or, as the case may be, the Delivery Date as
              the Lessor may stipulate, and the Lessor shall be
              entitled to treat any failure by the Lessee so to
              procure as an immediate Termination Event.

       3.5    LESSEE'S CONDITIONS PRECEDENT

              The obligations of the Lessee under this Agreement and the
       other Relevant Lease Documents to which it is a party
       shall be subject to the prior satisfaction in full, or
       waiver or deferral in writing by the Lessee to the extent
       not so satisfied, of the conditions precedent set out in
       Part 4 of Schedule 5.


4.     LEASING AND DELIVERY AND ACCEPTANCE OF THE VESSEL

4.1    LEASING

                   (a) Subject to the provisions of this Agreement, the
              Lessor agrees to lease to the Lessee, and the Lessee agrees
              to lease from the Lessor, the Vessel on and subject to the
              terms and conditions herein contained.

                   (b) Upon the commencement of the leasing hereunder, the
              Vessel will be sub-leased immediately by the Lessee to
              the Sub-Lessee upon and subject to the terms and
              conditions contained in the Sub-Lease.

4.2    DELIVERY AND ACCEPTANCE OF THE VESSEL

              The Lessor and the Lessee hereby agree that, as between the
       Lessor and the Lessee, upon delivery of the Vessel to the
       Lessor pursuant to the terms of the Shipbuilding Contract, the
       Lessee shall become unconditionally bound to accept delivery
       thereof under this Agreement.  Simultaneously with the
       delivery of the Vessel to the Lessor, the Lessee shall deliver
       to the Lessor an Acceptance Certificate duly executed by the
       Lessee and dated the date of such delivery.  Such Acceptance
       Certificate shall, without further act, constitute irrevocable
       evidence of delivery of the Vessel to the Lessee hereunder and
       acceptance thereof for all purposes of this Agreement.
              
5.     DISCLAIMERS AND EXCLUSIONS, LESSOR'S COVENANTS

5.1    DISCLAIMERS AND EXCLUSIONS

                     (a)    The Lessee acknowledges and agrees that:

                            (i) the Vessel has been designed, manufactured,
                     assembled and constructed without reference to
                     or involvement of the Lessor or any member of
                     the Lessor's Group and that the Lessee alone
                     has selected the Vessel for purchase by the
                     Lessor pursuant to the Shipbuilding Contract
                     and leasing by the Lessor to the Lessee
                     hereunder and for sub-leasing by the Lessee to
                     the Sub-Lessee under the Sub-Lease and for the
                     purposes described in any Service Contract;

                             (ii) the Lessor has not made or given nor shall
                     be deemed to have made or given any term,
                     condition, representation, warranty or
                     covenant, express or implied (whether statutory
                     or otherwise), as to the seaworthiness,
                     suitability, capacity, age, state, value,
                     quality, durability, condition, appearance,
                     safety, design, construction, operation,
                     performance, description, merchantability,
                     satisfactory quality, fitness for use or
                     purpose or any particular use or purpose or
                     suitability of the Vessel or any part thereof,
                     as to the absence of latent or other defects,
                     whether or not discoverable, as to the absence
                     of any infringement of any patent, trademark or
                     copyright, as to the ability of the Vessel to
                     satisfy the requirements of any law, rule,
                     specification or contract pertaining thereto,
                     or as to title to the Vessel or any other
                     representation or warranty whatsoever, express
                     or implied, with respect to the Vessel, all of
                     which are hereby excluded; and
              
                             (iii) the Lessee is taking the Vessel on lease
                     and is sub-leasing the Vessel to the Sub-Lessee on an
                     "as is, where is, and with all faults" basis,
                     and that the Lessee's acceptance of Delivery
                     from the Lessor in accordance with Clause 4.2
                     (Delivery and acceptance of Vessel) shall be
                     conclusive evidence (except as against the
                     Builder or the manufacturer of any part of the
                     Vessel) that the Vessel is complete, in good
                     order and condition, of satisfactory quality,
                     fit for any purpose for which it may be
                     intended or required, seaworthy in all
                     respects, without defect or inherent vice
                     whether or not discoverable by the Lessee,
                     suitable in all respects and in every way
                     satisfactory and without prejudice to the
                     foregoing, complies in all respects with the
                     Shipbuilding Contract.

                     (b) Save as otherwise expressly and specifically provided
              by this Agreement or any other Relevant Lease Document,
              the Lessee hereby waives as between itself and the
              Lessor and agrees not to seek to enforce, all its
              rights, express or implied (whether statutory or
              otherwise), whether against the Lessor in respect of
              the Vessel (or any part thereof) or against the Vessel
              or any part thereof (except rights arising out of any
              act or omission of the Lessor which is a breach by the
              Lessor of its express and specific obligations to the
              Lessee under this Agreement or any other Relevant Lease
              Document).

                     (c) The Lessor shall be under no obligation to provide
              to the Lessee or to any other person any replacement for
              the Vessel (or any part thereof) during any period when
              the Vessel (or any part thereof) is unavailable for use
              for any reason whatever nor, except where the
              unavailability for use arises solely as a result of the
              breach by the Lessor of its express and specific
              obligations to the Lessee under Clause 5.2 (Lessor's
              covenants) of this Agreement, otherwise to compensate
              the Lessee in respect of such unavailability for use.

                     (d) Save as expressly provided in this Agreement or the
              other Relevant Lease Documents, and without prejudice
              to the generality of Clauses 5.1 (a) and 5.1(b)
              (Disclaimers and exclusions), the Lessor shall be under
              no liability to the Lessee or any other person
              whatsoever and howsoever arising, and from whatever
              cause, and whether in contract, tort or otherwise, in
              respect of the satisfactory condition or fitness for
              purpose of the Vessel or any loss (consequential or
              otherwise), liability or damage of, or to, or in
              connection with, the Vessel or any part thereof
              (including delay in delivery thereof to the Lessee
              under this Agreement, or by the Lessee to any Sub-
              Lessee under any Sub-Lease or by the Sub-Lessee to any
              Service Contractor under any Service Contract, or
              thereafter or delay of any nature whatsoever) or any
              person or property whatsoever irrespective of whether
              such loss, liability or damage shall arise from any
              action or omission of the Lessor and whether or not the
              same shall arise from the Lessor's negligence, actual
              or imputed (other than any action or omission of the
              Lessor which is a breach by the Lessor of its express
              and specific obligations to the Lessee under the
              Relevant Lease Documents to which the Lessor is party).

       5.2    LESSOR'S COVENANTS ETC.

                     (a) The Lessor covenants to the Lessee that throughout
              the Lease Period the Lessor (other than through the acts or
              omissions of any Security Party, or any Security
              Party's agents or representatives, acting as agent or
              representative of the Lessor) will not, otherwise than
              pursuant to its rights under any of the Relevant Lease
              Documents or which may exist under any applicable law
              as a result of the occurrence of any Termination Event
              which is continuing and except as may be required by
              law or any ruling or recommendation of any Government
              Entity compliance of which is customary for the Lessor,
              interfere with the quiet use, possession and quiet
              enjoyment of the Vessel by the Lessee.  The Lessee
              acknowledges that the covenant by the Lessor contained
              in this Clause 5.2(a) is, as between the Lessor and the
              Lessee, the sole covenant by the Lessor in respect of
              quiet enjoyment and is in substitution for, and to the
              exclusion of, any other covenant for quiet enjoyment
              which may have otherwise been given or implied at law
              or otherwise, all of which are hereby expressly
              excluded and waived by the Lessee.  The provisions of
              this Clause 5.2(a) are, however, without prejudice to
              the Lessor's obligations under Clause 5.2(b).

                     (b) The Lessor covenants with the Lessee that, subject
              to the proviso in this Clause 5.2(b), throughout the Lease
              Period the Lessor shall not create or permit to arise
              or suffer to exist any Lien on the Vessel which arises
              solely from, or solely as a result of:

                             (i) any claim against or affecting the Lessor
                     (including any claim in relation to any other
                     vessel of which the Lessor is the beneficial
                     owner) and chartered by it otherwise than to
                     the Lessee or any other member of the
                     Guarantor's Group that is not related to, or
                     does not arise directly or indirectly as a
                     result of, the transactions contemplated by
                     this Agreement or any of the other Lease
                     Documents; or

                             (ii)  any act or omission of the Lessor that is
                     not related to, or does not arise directly or
                     indirectly as a result of, the transactions
                     contemplated by this Agreement or any of the
                     other Lease Documents; or

                             (iii) any Taxes imposed upon the Lessor, other
                     than those in respect of which the Lessor is
                     required to be indemnified against by the
                     Lessee or by any other person under this
                     Agreement or under any of the other Lease
                     Documents; or

                             (iv) any act or omission of the Lessor (but not
                     of any Security Party or any Security Party's
                     agents or representatives acting as agent or
                     representatives of the Lessor) constituting a
                     breach by the Lessor of its express and
                     specific obligations under this Agreement or
                     the other Relevant Lease Documents; or

                             (v) any act or omission of the Lessor which
                     constitutes the wilful misconduct of or
                     recklessness by the Lessor,

                            PROVIDED THAT if any of (i),(ii),(iii),(iv) 
              or (v) above applies to any Lien, the Lessor shall not be
              liable to pay or discharge the same, or the amount of
              the same or remove the same, if adequate reserves for
              the payment of such amount have been provided and such
              Lien is being disputed by the Lessor or any other
              person on its behalf in good faith and in a manner
              effectively staying such Lien and the continued
              existence of such Lien does not involve any reasonable
              likelihood of the arrest of the Vessel or the sale,
              forfeiture or loss of, or any interest in, the Vessel
              (or any part thereof) and without prejudice to the
              foregoing, if the Vessel is at any time during the
              Lease Period:

                             (i) arrested, seized, taken into custody or
                     otherwise detained by any court or other
                     tribunal or by any Government Entity; or

                             (ii) subjected to distress by reason of any
                     process, claim, the exercise of any rights conferred by
                     a Lien or by any other action whatsoever

                            in either event arising out of the use or 
              operation of any other vessel for the time being operated by
              the Lessor or owned or chartered in by the Lessor which
              vessel is not chartered to the Lessee or any other
              member of the Guarantor's Group (and if the Lessor
              fails in accordance with its aforementioned obligations
              to secure the release of the Vessel or fails to
              discharge the liability in respect of which the Vessel
              has been arrested, seized, taken into custody, detained
              or subjected to distress as aforesaid), the Lessee
              shall be entitled:

                                 (a) to act as agent for the Lessor for the
                     purpose of securing the release of the Vessel;

                                 (b) to discharge such liability; and
                                   
                                 (c) to be indemnified by the Lessor and held
                     harmless against all direct losses (including
                     loss of hire) and expenses so incurred by it.

                     (c) The Lessor acknowledges that it shall not be entitled
              to, and covenants with the Lessee that it shall not,
              serve a notice upon a Payment Bank in accordance with
              clause 5.4 of the Payment Agreement to which such
              Payment Bank is a party (the "RELEVANT PAYMENT
              AGREEMENT") unless any of the following shall have
              occurred:

                              (i) a Termination Event; or

                              (ii) an Acceleration Notice has been given; or

                              (iii) a Total Loss of the Vessel; or

                              (iv) the Lessee shall have given a notice to the
                     Lessor under Clause 6.4, 21.4(A), 21.4(B),
                     21.4(C) 21.4(D) or 21.4(E); or

                               (v) the circumstances described in clause 5.5 of
                     the Relevant Payment Agreement; or

                               (vi) a Payment Bank Event of Default with 
                     respect to such Payment Bank (which event and any notice
                     served by the Lessor on a Payment Bank as a
                     consequence thereof shall, for the avoidance of
                     doubt, not have any effect on the rights and
                     obligations of the Lessor or the Lessee under
                     this Agreement and the other Lessor Documents).

                     (d) The Lessor covenants with the Lessee that if the
              circumstances described in clause 5.1, 5.2 or 5.3 of
              either Payment Agreement occur and:

                               (i) the relevant Payment Bank does not exercise
                     its rights pursuant to such clause 5.1, 5.2 or, as
                     the case may be 5.3 to make the payment
                     described in clause 5.7 of the relevant Payment
                     Agreement to the Lessor or at the Lessor's
                     direction; and

                               (ii) the Lessor does not exercise its rights
                     pursuant to clause 5.6 of the relevant Payment
                     Agreement to require the relevant Payment Bank
                     to make the payment described in such clause
                     5.7 to the Lessor or at its direction, or to a
                     Replacement Payment Bank (as such term is
                     defined in clause 5.4 of the relevant Payment
                     Agreement), then upon receiving a written
                     request from the Lessee, the Lessor will
                     exercise its rights pursuant to such clause 5.6
                     to require the relevant Payment Bank to make
                     the payment described in such clause 5.7 either
                     to the Lessor or at its direction (it being
                     acknowledged that the Lessor shall be entitled
                     to decide as to where the payment is to be made
                     in this regard) or to an entity proposed by the
                     Lessee to be the "REPLACEMENT PAYMENT BANK".

5.3    UNFAIR CONTRACT TERMS ACT 1977

              Without prejudice to the indemnities of the Lessor by the
       Lessee contained in any of the Relevant Lease Documents,
       nothing in this Clause 5 shall afford to the Lessor any wider
       exclusion of any liability of the Lessor to any person for
       death or personal injury than the Lessor may effectively
       exclude having regard to the provisions of the Unfair Contract
       Terms Act 1977.

5.4    QUIET ENJOYMENT WITH RESPECT TO THE SUB-LESSEE AND SERVICE
       CONTRACTORS

              The Lessee will cause the provisions of Clause 5.1 to be made
       known to the Sub-Lessee and will procure that the Sub-Lessee
       confirms to the Lessor, prior to the commencement of the sub-
       leasing, that it accepts and agrees to be bound by the
       provisions of Clause 5.1.  The Lessor will, upon being
       requested to do so by the Lessee, provide a letter to the
       Service Contractor in form and content mutually acceptable to
       the Lessor and the Lessee (each acting reasonably).

6.     LEASE PERIOD

6.1    PRIMARY PERIOD

              The leasing of the Vessel hereunder shall commence on the
       Delivery Date and shall, subject to this Clause 6, continue
       until the Primary Period End Date unless earlier terminated in
       accordance with this Agreement.

6.2    SECONDARY PERIOD

       6.2.1  The Lessee may, by written notice to the Lessor to be received
       by the Lessor no later than one month prior to the date upon
       which the leasing of the Vessel under this Agreement would
       otherwise expire by effluxion of time request that the leasing
       of the Vessel be extended for a Secondary Period (or, as the
       case may be, a further Secondary Period).  Any notice once
       given by the Lessor pursuant to this Clause 6.2 may only be
       withdrawn with the written consent of the Lessor.

       6.2.2  The continuation of the leasing under Clause 6.2.1 shall be
       subject to:

              (i) no Termination Event having occurred and being
              continuing; and

              (ii) evidence in form and substance satisfactory to the
              Lessor of the Vessel not having reached and not being
              likely to reach during the relevant Secondary Period,
              the end of its useful economic life and remaining,
              during such Secondary Period, safe and capable of
              performing the function which it is carrying out at the
              time of the commencement of the proposed Secondary
              Period.

6.3    ACCELERATION

       6.3.1  The Lessor shall be entitled, by giving to the Lessee not
       less than thirty (30) days' written notice to expire on the first
       day of the Lessor's Accounting Period immediately following
       the twelfth (12th) anniversary of the Delivery Date, to
       require the Lessee to terminate the leasing of the Vessel
       under this Agreement and pay to the Lessor a Rental (the
       "ACCELERATION RENT") with respect to the Vessel.  The
       Acceleration Rent shall be of an amount equal to the
       Termination Rent (as calculated in accordance with Part 4 of
       the Financial Schedule) which would have been payable on the
       day the Acceleration Rent is payable, if that date had in fact
       been the Termination Payment Date (such that, in particular,
       the Termination Assumption set out in paragraph 4.5.2(e) of
       the Financial Schedule is applied in calculating such
       Termination Rent).  The Acceleration Rent shall be subject to
       adjustment in accordance with Part 4 of the Financial Schedule
       as if it were a Termination Rent.

       6.3.2  The Lessee shall be entitled, upon giving notice in writing to
       the Lessor seven (7) months prior to the first day of the
       Lessor's Accounting Period immediately following the twelfth
       (12th) anniversary of the Delivery Date, to request the Lessor
       to submit to the Lessor's normal credit approval process
       either of the following proposals:

                  (i) that the Lessor waive its entitlement described in
              Clause 6.3.1 or extend the date upon which the Lessor
              is entitled to exercise its option described in Clause
              6.3.1; or

                  (ii) to approve one or more banks or financial institutions
              to assume the obligations then existing of the Payment
              Banks;

              and the Lessor agrees that it will make such a submission
       PROVIDED THAT the Lessee acknowledges and agrees that the
       Lessor shall be entitled to accept or reject either proposal
       (including approving or disapproving the identity of any such
       bank or financial institution) in its absolute discretion
       without giving any reasons for such acceptance or rejection
       and that if the Lessor accepts either proposal, such
       acceptance shall be conditional upon any requirements (whether
       in regard to documentation or otherwise) which the Lessor may,
       in its absolute discretion, specify.  Furthermore, the Lessee
       agrees that the Lessor shall not be obliged to reveal any
       details of its internal credit or other procedures or the
       reasons for any decision made in any particular case.

6.4    VOLUNTARY TERMINATION

              If the Lessee has, pursuant to its rights in Clause 19.2 
       (Sale of the Vessel), arranged a sale of the Vessel in accordance
       with the provisions of Clause 19.2, the Lessee shall have the
       right exercisable upon at least fifteen (15) days' written
       notice to the Lessor (which notice, once given, shall be
       irrevocable) to terminate the leasing of the Vessel hereunder
       or, if Delivery has not then occurred, the right of the Lessee
       to take the Vessel on lease, on the date specified in such
       notice (which shall be the date upon which such sale is to be
       completed) PROVIDED THAT the Lessee shall only be entitled to
       exercise the right of voluntary termination under this Clause
       6.4 if no Termination Notice has been served upon it.

7.     RENT

7.1    PRE-LEASE PERIOD RENTAL

              During the Pre-Lease Period no rental shall be payable by the
       Lessee to the Lessor in respect of the hiring of the Vessel.

7.2    PRIMARY PERIOD RENT

              The Lessee shall pay to the Lessor, in respect of the Primary
       Period, a Primary Period Rent on each Rent Payment Date
       throughout the Primary Period, each such Primary Period Rent
       to be calculated in accordance with the provisions of the
       Financial Schedule.  Each such amount of Primary Period Rent
       shall be subject to adjustment and supplement in accordance
       with the provisions of the Financial Schedule.

7.3    SECONDARY PERIOD RENT

              The Lessee shall pay to the Lessor on the first day of each
       Secondary Period a Secondary Period Rent calculated in
       accordance with paragraph 1.2 of the Financial Schedule.

7.4    ADDITIONAL RENT

              The Lessee shall, on the dates ascertained in accordance with
       the Financial Schedule (or, if no such date is specified, upon
       written demand by the Lessor), pay all amounts calculated and
       due to the Lessor under the Financial Schedule and expressed
       to be payable by way of additional Rent. 

8.     PAYMENTS

8.1    LESSOR'S ACCOUNT

              Each payment to be made by the Lessee to the Lessor in
       Sterling pursuant to this Agreement shall be made from a bank
       account in the United Kingdom in Sterling in cleared funds for
       value on the due date by means of CHAPS to the account of the
       Lessor with the Bank at its branch at 71 Lombard Street,
       London EC3P 3BS, England, account number 0439687, sort code
       30-00-02, or to such other bank account in the United Kingdom
       as the Lessor may from time to time designate by not less than
       ten (10) Business Days' notice to the Lessee.  Any payment
       which is to be made to the Lessor in a currency other than
       Sterling pursuant to this Agreement shall be made to such
       account as the Lessor shall notify the Lessee in writing.

8.2    PAYMENTS UNCONDITIONAL

              The Lessee's obligation to pay Rent and make other payments,
       and perform any obligations, owed to the Lessor pursuant to or
       in connection with this Agreement or any of the other Relevant
       Lease Documents to which it is a party shall, subject to
       Clause 23.1, be absolute and unconditional and shall not be
       affected by and shall be irrespective of any contingency
       whatsoever including (but not limited to):

                   (a) any right of set-off, counterclaim, recoupment,
              defence, deduction, withholding or other right;

                   (b) any unavailability of the Vessel for any reason,
              including, but not limited to, requisition thereof, or
              any prohibition or interruption of or other restriction
              against the Lessor's, the Lessee's, the Sub-Lessee's,
              any Service Contractor's or any other person's use,
              operation or possession of the Vessel, any interference
              with such use, operation or possession or failure to
              deliver any part of the Vessel or any lack or
              invalidity of title or any other defect in the title,
              suitability, seaworthiness, satisfactory quality,
              merchantability, fitness for any purpose, condition,
              appearance, safety,  design, or operation of any kind
              or nature of the Vessel, or the ineligibility of the
              Vessel for any particular use or trade, or for want of
              registration or the absence or withdrawal of any
              permit, licence, authorisation or other documentation
              required under the applicable law of any relevant
              jurisdiction for the ownership, leasing, use, operation
              or location of the Vessel, or (subject to Clause
              10.1(a) (Total Loss)) the Total Loss of, or any damage
              to, the Vessel or any part thereof;

                   (c) any insolvency, bankruptcy, winding-up, 
              administration, reorganisation, reconstruction, arrangement,
              readjustment or rescheduling of debt, dissolution,
              liquidation or similar proceedings by or against the
              Lessor, the Bank, the Lessee or any other person
              (whether a party to any Lease Document or not);

                   (d) any invalidity or unenforceability or lack of due
              authorisation of, or other defect in, this Agreement or
              any of the other Lease Documents or any particular
              provision hereof or thereof;

                   (e) any failure or delay on the part of any party, whether
              with or without fault on its part, duly to perform or
              comply with its obligations under this Agreement or any
              of the other Lease Documents; and 

                   (f) any other case which but for this provision would or
              might have the effect of terminating or in any way
              affecting any obligation of the Lessee hereunder,

              (but without prejudice to the rights of the Lessee to damages
       or specific performance or any other injunctive relief in
       respect of this Agreement or any of the other Relevant Lease
       Documents) it being the declared intention of the parties that
       the provisions of this Clause 8 and the obligations of the
       Lessee to pay Rent and make other payments in accordance with
       this Agreement and the other Relevant Lease Documents shall
       survive any frustration and that save as expressly and
       specifically provided in this Agreement no moneys payable or
       paid hereunder by the Lessee to the Lessor shall in any event
       or circumstances be repayable to the Lessee.

8.3    INTEREST ON OVERDUE AMOUNTS

                    (a) If, subject to Clause 23.1, any amount payable by
              the Lessee to the Lessor under this Agreement or any of the
              other Relevant Lease Documents is not paid in full on
              the date such amount becomes due and payable hereunder
              or thereunder, the Lessor shall (without prejudice to
              the rights of the Lessor under Clause 21 (Termination
              provisions)) be entitled, in addition, to demand
              interest on the unpaid sum at the Default Rate from and
              including such date to and including the date of actual
              payment (after as well as before judgment).  Such
              interest at the Default Rate shall accrue on a day to
              day basis and be compounded quarterly.

                    (b) If any amount payable by the Lessor to the Lessee
              under this Agreement or any of the other Relevant Lease
              Documents is not paid in full on the date such amount
              becomes due and payable hereunder or thereunder, the
              Lessee shall be entitled, in addition, to demand
              interest on the unpaid sum at LIBOR from and including
              such date to and including the date of actual payment
              (after as well as before judgment).  Such interest
              shall accrue on a day to day basis and be compounded
              quarterly.

                    (c) All interest under this Clause 8.3 shall be calculated
              on the basis of the actual number of days elapsed and
              (i) a three hundred and sixty-five (365) day year in
              relation to Sterling amounts (or, where market practice
              in the London Inter-Bank Market differs, in accordance
              with market practice in the London Inter-Bank Market)
              and amounts in other currencies where that is the
              normal bank basis for interest calculations under the
              relevant currency, or (ii) a three hundred and sixty
              (360) day year for amounts in other currencies. 

8.4    TIME OF THE ESSENCE

              Punctual payment of amounts payable by the Lessee to the
       Lessor and performance by the Lessee of each of its
       obligations under this Agreement shall, subject to any express
       periods of grace set out in Clause 21.1 (Termination
       provisions) and as otherwise agreed in writing by the Lessor,
       be of the essence and shall be conditions of this Agreement.

8.5    BUSINESS DAYS

              If any payment under this Agreement or any other Relevant
       Lease Document is due on a day which is not a Business Day, it
       shall, unless expressly provided to the contrary in this
       Agreement or the relevant other Relevant Lease Document, be
       paid on the immediately succeeding Business Day, together with
       interest from the due date, on a daily basis at LIBOR for the
       relevant period, unless that day falls in the calendar month
       succeeding that in which the date on which the payment is due
       falls, in which case it shall be due on the immediately
       preceding Business Day, but the amount of such payment shall
       not be adjusted in consequence thereof.

8.6    APPLICATION OF PAYMENTS

              If the Lessee shall pay to the Lessor, or the Lessor shall
       otherwise recover, any amount expressed to be payable under
       this Agreement or any of the other Relevant Lease Documents in
       an amount less than the total amount then due, or due and
       outstanding, the sum so paid may be applied by the Lessor
       (irrespective of any contrary appropriation by the Lessee) in
       or towards satisfaction of such amounts which are due for
       payment under this Agreement and the other Relevant Lease
       Documents in such manner or order and at such time as the
       Lessor may think fit.


9.     COVENANTS CONCERNING INSURANCES

9.1    INSURANCES IN RESPECT OF THE VESSEL

              The Lessee hereby covenants with the Lessor and undertakes
       that, throughout the Lease Period and thereafter until sale of
       the Vessel, it will:

                   (a) insure and keep the Vessel insured free of cost and
              expense to the Lessor and in the joint names of the
              Lessee and the Lessor, without liability on the part of
              the Lessor for premia or calls (each as their interests
              may appear) in respect of claims arising in connection
              with the ownership or operation of the Vessel:

                          (i) against fire and usual marine risks (including
                     Excess Risks to the extent not covered under
                     the Liability Insurances) and war risks, on an
                     agreed value basis in accordance with the
                     practice from time to time of prudent owners of
                     similar types of vessel as the Vessel, provided
                     that the amount of such insurances shall be
                     equal to or greater than the highest Tax
                     Written Down Value for the Vessel for the
                     period of such insurances; and

                          (ii) against protection and indemnity risks
                     (including oil pollution liability) on terms
                     and conditions which are the same or
                     substantially the same as the insurance taken
                     out with respect to the same risks by other
                     owners of comparable size and standing
                     operating similar types of vessel as the Vessel
                     in the jurisdictions where the Vessel is being
                     operated at the relevant time and which is
                     reasonably available to the Lessee (taking into
                     account the provisions of this Agreement and
                     the fact that although the Lessor is the owner
                     of the Vessel it has no operational interest in
                     the Vessel) and shall be in an amount of two
                     hundred million Dollars ($200,000,000) any one
                     occurrence or such greater amount as is either
                     (x) the general practice from time to time of
                     owners of equivalent tonnage to and similar
                     types of vessel as the Vessel to obtain in the
                     jurisdiction(s) in which the Vessel is being
                     operated at the time when such general practice
                     is being determined (provided such greater
                     amount is reasonably obtainable by the Lessee)
                     or (y) required by any rules, regulations,
                     laws, treaties or conventions of the Flag State
                     from time to time or of the jurisdiction in
                     which the Vessel is being operated at any
                     particular time or (z) following a Change of
                     Law with respect to an Environmental Law in a
                     jurisdiction in which the Vessel is being
                     operated at any particular time, and the Lessor
                     reasonably determining that such a Change of
                     Law has resulted in the actual or potential
                     liability of the Lessor with respect to an
                     Environmental Claim increasing above the
                     Lessor's liability as at the date of this
                     Agreement under the Oil Pollution Act of 1990,
                     as amended, of the United States of America
                     (the "MEASURED LIABILITY"), the amount of such
                     increase in liability over the Measured
                     Liability or, where the Vessel is employed in
                     the storage of hydrocarbons, for the amount
                     which is the general practice from time to time
                     of owners of comparable size and standing
                     operating similar types of vessels as the
                     Vessel employed in such use in jurisdictions in
                     which the Vessel is being operated at any
                     particular time;

                     and in each case the Lessor may rely upon the advice of
              its legal, insurance and other advisers and the Lessee
              further agrees that the Lessor shall be deemed to have
              acted reasonably in connection with any Lessor Action
              under or in connection with this Clause 9 if the Lessor
              has relied upon any such advice of its legal, insurance
              or other advisers;

                     (b) if the Lessor requires an increase in the amount
              insured in respect of oil pollution liability risks in
              accordance with the provisions of Clause 9.1(a)(ii),
              the Lessee shall effect such increase within ten (10)
              Business Days of being notified by the Lessor to effect
              such increase or, if later, the date upon which such
              increase is required pursuant to the rules,
              regulations, laws, treaties or conventions referred to
              in Clause 9.1(a)(ii)(y) or, as the case may be, the
              date upon which the Change of Law referred to in Clause
              9.1(a)(ii)(z) comes into effect;

                     (c) effect the Insurances, including the Liability
              Insurances aforesaid in Dollars (where appropriate in
              an equivalent amount at the time of each renewal of the
              Insurances to the amount required expressed in
              Sterling) or such other freely transferable and
              convertible currency acceptable to the Lessor and
              through the Approved Brokers or such other insurance
              companies and/or underwriters or by entry of the Vessel
              with a mutual insurance association or club;

                     (d) punctually pay all premiums, calls, contributions
              or other sums payable in respect of all such Insurances
              and to produce all relevant receipts or other evidence
              of payment when so required by the Lessor and, in the
              event that any premium or call is charged to be levied
              upon the Lessor, the Lessee shall forthwith reimburse
              the Lessor with any amount so paid;

                     (e) at least ten (10) Business Days (or such shorter
              period as the Lessor may from time to time agree) before the
              relevant policies, contracts or entries expire, notify
              the Lessor of the names of the marine and war risks
              brokers and/or the war risks or protection and
              indemnity risks associations and/or underwriters
              proposed to be employed by the Lessee for the purposes
              of the renewal of such Insurances and of the amounts in
              which such Insurances are proposed to be renewed and
              the risks to be covered and, subject to compliance with
              the provisions of this Clause 9.1, procure that
              appropriate instructions for the renewal of such
              Insurances are given to the Approved Brokers and/or to
              the approved war risks and protection and indemnity
              risks associations at least ten (10) days (or such
              shorter period as the Lessor may from time to time
              agree) before the relevant policies, contracts or
              entries expire, and that the Approved Brokers and/or
              the approved war risks and protection and indemnity
              risks associations and/or approved underwriters will at
              least seven (7) days before such expiry (or within such
              shorter period as the Lessor may from time to time
              agree) confirm in writing to the Lessor as and when
              such renewals have been effected in accordance with the
              instructions so given;

                     (f) if any of the Insurances referred to in Clause
              9.1(a)(i) form part of a fleet cover for the Lessee or
              the Guarantor and any Subsidiaries (US), and such
              Approved Brokers are or would be entitled to exercise
              rights of set-off or cancellation in relation to claims
              under such Insurances relating to the Vessel for non-
              payment of premiums in respect of other vessels covered
              by the same Insurances, the Lessee shall use all
              reasonable endeavours (having regard to the then
              current market practice including the practice
              prescribed by the Lloyd's Insurance Brokers' Committee
              and/or any other professional association of which the
              Approved Brokers are members) to procure that the
              Approved Brokers shall undertake to the Lessor:

                           (i) not to exercise against the policy or against
                     any claims in respect of the Vessel any Lien or
                     right of set-off for unpaid premiums in respect
                     of vessels other than the Vessel covered under
                     such fleet cover or for unpaid premiums in
                     respect of any other such policies of
                     insurance; and

                           (ii)   not to cancel the Insurances for the Vessel
                     by reason of the non-payment of premiums for
                     vessels covered by such fleet cover,

                           or, in lieu of the undertakings referred to in
              paragraphs (i) and (ii), shall instruct the Approved
              Brokers to issue a separate policy of insurance in
              respect of the Vessel as and when the Lessor may so
              require;

                     (g) promptly arrange for the execution and delivery of
              such guarantees or indemnities as may from time to time be
              required by any protection and indemnity or war risks
              association in accordance with its rules or the terms
              of entry of the Vessel;

                     (h)    procure:

                            (i) that all original slips, cover notes, policies,
                     certificates of entry and other instruments of
                     insurance issued from time to time shall
                     forthwith be deposited with the Approved
                     Brokers in respect of those of the Insurances
                     in respect of the Vessel which are effected
                     through Approved Brokers; and

                            (ii) that the interest of the Lessor shall be
                     endorsed on the Insurances referred to in
                     Clause 9.1(a)(i) and (ii) by noting the
                     interests of the Lessor on the policies and by
                     the endorsement of the Loss Payable Clause on
                     the policies in respect of the Hull Insurances;

                     (i) procure that the Approved Brokers or the insurers
              and any protection and indemnity or war risks association
              or the war risks insurers in which the Vessel may from
              time to time be entered or with whom cover may be
              placed shall deliver to the Lessor a letter or letters
              of undertaking in such form as the Lessor may
              reasonably require having regard to the then current
              market practice and the practices prescribed by the
              "International Group" of protection and indemnity
              associations or successor association or body and/or
              the Lloyd's Insurance Brokers' Committees and/or any
              other professional association of which the Approved
              Brokers are members;

                     (j) comply with the terms and conditions of the 
              Insurances, not do, consent to or permit any act or omission
              which might invalidate or render unenforceable the whole or
              any part of the Insurances and not (without first
              obtaining the consent of the insurers to such
              employment and complying with such requirements as to
              extra premium or otherwise as the insurers may
              prescribe) employ the Vessel or suffer the Vessel to be
              employed otherwise than in conformity with the terms of
              the Insurances (including any warranties express or
              implied therein) and within the geographical limits
              thereof; and

                     (k) supply to the Lessor all necessary information,
              documentation and assistance which may be required by
              the Lessor from time to time in respect of the
              Insurances and in connection with making any claim
              under the Insurances,

              PROVIDED HOWEVER THAT if, in the event of requisition of the
       Vessel for hire, it is proved to the satisfaction of the
       Lessor that such requisition is upon terms whereby the
       requisitioning authority has assumed the responsibility of the
       Lessee to the Lessor to indemnify or recompense it in respect
       of or otherwise to make good all losses which would ordinarily
       be covered by the insurance required to be effected by the
       Lessee under this Agreement, the Lessee shall be relieved from
       its insurance obligations under this Agreement in respect of
       such period of requisition or in the event that the
       requisitioning authority shall have assumed only a partial
       responsibility as aforesaid, the insurance obligations of the
       Lessee under this Agreement shall be modified in such manner
       and to such extent as the Lessor may approve in its absolute
       discretion having regard to the insurance provisions contained
       in this Agreement.

9.2    If, at the time of any renewal of the Insurances, there is, in
       the opinion of the Lessor acting reasonably:

                  (a) any material adverse change in the credit standing or
              claims payment record of the relevant insurer or war
              risks or protection and indemnity association; or

                  (b) any material adverse change in the terms on which the
              relevant Insurances are placed; or

                  (c) any change affecting the insurance market which may
              have, or may be likely to have, a material adverse
              effect on the Insurances in respect of the Vessel,

              then the Lessor may, having consulted with its insurance
       advisers, stipulate reasonable requirements for the Insurances
       in the light of such changes.  If the Lessor has stipulated
       such requirements to the Lessee, the Lessor and the Lessee
       shall (at the cost of the Lessee) respectively cause their
       insurance advisers to meet to consider the Lessor's
       requirements and, if such advisers do not agree promptly with
       respect to such requirements, the matter shall be referred to
       an appropriate independent insurance adviser agreed by the
       Lessor and the Lessee.  In the absence of agreement as to an
       appropriate independent insurance adviser, either the Lessor
       or the Lessee may request the President for the time being of
       the Law Society to appoint an appropriate independent
       insurance adviser who shall act as an expert and not as an
       arbitrator and whose assessment with respect to such
       requirements shall be final and binding on the Lessor and the
       Lessee.

              If the insurance advisers of the Lessor and the Lessee agree
       with respect to such requirements and on the changes required
       to be effected to the then current insurance requirements or
       if the independent insurance adviser, appointed by the
       President of the Law Society, stipulates changes required to
       be effected to the then current insurance requirements then
       (a) the Lessee shall, at its own cost, promptly, and in any
       event within sixty (60) days of such agreement, or as the case
       may be stipulation, effect or procure that there is effected
       such requirements and (b) the Lessor shall be entitled, at the
       Lessee's cost, to effect contingent third party liability
       insurances for the Lessor and members of the Lessor's Group to
       cover such requirements.

9.3    COLLECTION OF CLAIMS

              The Lessee shall do all things necessary and provide all
       documents, evidence and information to enable the Lessor to
       collect or recover all moneys which shall at any time become
       due to the Lessor in respect of the Insurances.

9.4    APPLICATION OF RECOVERIES

              The Lessee shall apply all sums receivable under the
       Insurances which are paid to it in accordance with the Loss
       Payable Clauses.

9.5    OTHER INSURANCES AND ASSUREDS

              The Lessee shall not, without the prior written consent of the
       Lessor, during the Lease Period take out additional insurances
       for the Lessee's sole benefit, or permit the Lessee or the
       Lessor to be named insured in insurances with respect to the
       Vessel, other than as required under this Agreement, where
       such additional insurances will or may prejudice the
       Insurances or recovery thereunder or will exceed the amount
       permitted by the warranties or other conditions of the
       Insurances (unless the insurers under the Insurances have
       consented thereto) and will, upon the Lessor's request,
       immediately furnish the Lessor with particulars of any such
       additional insurances (including copies of any cover notes or
       policies) and of the written consent of the insurers under the
       Insurances in any case where such consent is necessary.  The
       Lessor acknowledges that the provisions of this Clause 9.5 are
       without prejudice to the Lessee's right to take out loss of
       hire insurances in respect of the Vessel in accordance with
       usual market practice.

9.6    ENCUMBRANCES

              The Lessee shall not create or permit to exist any Lien over
       the Lessee's interest in the Insurances or any Requisition
       Compensation save as contemplated by this Agreement.

9.7    BROKER'S REPORT

              On the date of this Agreement and on each date when the
       Insurances are renewed, the Lessee shall, at its own expense,
       furnish or cause to be furnished to the Lessor evidence that
       the Insurances have been placed in accordance with this Clause
       9 and are in full force and effect together with an opinion
       signed by a firm of insurance brokers other than the Approved
       Brokers stating that the Insurances then in effect are
       consistent with the requirements for the Insurances under this
       Agreement and in compliance with the terms of this Clause 9.

9.8    OMISSION TO COMPLY WITH INSURANCE PROVISIONS

              If at any time the Lessee shall fail to comply with:

                   (a) any of the provisions of this Clause 9 in relation to
              or in connection with all or any part of the Liability
              Insurances and the Vessel; or

                   (b) any of the material provisions of this Clause 9 in
              relation to or in connection with all or any part of
              the Hull Insurances and the Vessel,

              then the Lessor shall be entitled (at the Lessee's cost and
       expense), either (i) to procure such insurance or entries in a
       war risks association and/or protection and indemnity
       association or associations in accordance with the aforesaid
       provisions, or (ii) at any time whilst such failure is
       continuing to require the Vessel to remain in port or, as the
       case may be, to proceed to and remain in a port designated by
       the Lessor until such provisions are fully complied with, or
       both, but without prejudice to the right of the Lessor in any
       such case to treat such failure as being within Clause 21
       (Termination provisions). Rent shall continue to accrue during
       such time and any expense incurred by the Lessor in relation
       to or in connection with any of the arrangements described
       above shall be recoverable from the Lessee on demand.

9.9    LESSOR'S INSURANCE

              Any insurance effected by the Lessor which the Lessee is not
       obliged to effect under this Clause 9 shall not be brought
       into account in relation to any claim under any indemnity in
       favour of any Indemnified Person under any of the Lease
       Documents.

10.    TOTAL LOSS AND DAMAGE

10.1   TOTAL LOSS

                     In the event of:

                   (a) a Total Loss occurring prior to Delivery, the
              obligation of the Lessor to lease the Vessel to the
              Lessee shall terminate on the Date of Total Loss; or

                   (b) a Total Loss occurring during the Lease Period, the
              Lease Period shall end on the Date of Total Loss and
              the obligation of the Lessee to pay Rent (other than
              any Termination Payment) under Clause 7 (Rent) becoming
              due on any Rent Payment Date which falls on or after
              the Date of Total Loss shall cease; and

              the Lessee shall (without prejudice to the obligations of the
       Lessee pursuant to any provision of this Agreement or the
       Relevant Lease Documents to pay to the Lessor all sums which
       may become due to the Lessor or be ascertained after the Date
       of Total Loss) pay to the Lessor, as compensation for the
       Lessor's full financial loss consequent upon such termination,
       the amounts set out below and on the dates prescribed below
       for those amounts (but subject always to its application both
       before and after the date on which such payment is made, to
       the provisions of the Financial Schedule):

                    (i) if (during the Lease Period) on or after the Date
              of Total Loss but before the Settlement Date there falls a
              day which, if the leasing of the Vessel had not
              terminated, would have been a Rent Payment Date, the
              Lessee shall on that Rent Payment Date pay to the
              Lessor an amount equal to the Rent which would have
              become payable had the Total Loss not occurred; and

                    (ii) on the Settlement Date, the Lessee shall pay to the
              Lessor an amount equal to the aggregate of:

                           (A) the Termination Payment calculated for the
                     Settlement Date;

                           (B) all instalments of Rent (if any) which have
                     become due prior to the Date of Total Loss and
                     remain unpaid; and

                           (C) all other amounts due and payable from the
                     Lessee to the Lessor pursuant to any Relevant
                     Lease Document, including, without limitation,
                     any Broken Funding Costs (less any Broken
                     Funding Gains).

10.2   APPLICATION OF TOTAL LOSS PROCEEDS

              All moneys received by the Lessor from insurers in respect of
       a Total Loss and all Requisition Compensation received by the
       Lessor shall be applied by the Lessor as follows:

                   (a) first, in retention by the Lessor of an amount equal
              to one per cent. (1.0%) of the amount by which the Total
              Loss Proceeds exceed the applicable Termination Rent;

                   (b) secondly, any balance remaining shall be paid to the
              Lessee by way of rebate of Rent.

10.3   DATE OF TOTAL LOSS

              For the purposes of this Agreement, a Total Loss in respect of
       the Vessel shall be deemed to have occurred:

                    (a) in the case of an actual total loss of the Vessel at
              noon (London time) on the actual date the Vessel was
              lost or, if such date is not known, on the date on
              which the Vessel was last reported;

                    (b) in the case of constructive total loss of the Vessel,
              on the date and at the time notice of abandonment of
              the Vessel is given to the insurers of the Vessel for
              the time being (provided a claim for such constructive
              total loss is admitted by the insurers) or, if the
              insurers do not admit such a claim, on the date and
              time at which a constructive total loss is subsequently
              adjudged by a competent court of law to have occurred; 

                    (c) in the case of a compromised or arranged total loss,
              on the date upon which a binding agreement as to such
              compromised or arranged total loss has been entered
              into by the insurers of the Vessel;

                    (d) in the case of Compulsory Acquisition, on the date
              on which the relevant requisition of title or other
              compulsory acquisition occurs; and

                    (e) in the case of hijacking, theft, condemnation,
              confiscation, capture, detention or seizure of the
              Vessel (other than where the same amounts to Compulsory
              Acquisition of the Vessel) which deprives the Lessee
              or, as the case may be, any Sub-Lessee of the use of
              the Vessel for more than one hundred and eighty (180)
              days, upon the expiry of the period of one hundred and
              eighty (180) days after the date upon which the
              relevant hijacking, theft, condemnation, confiscation,
              capture, detention or seizure occurred.

              The date on which a Total Loss shall be deemed pursuant to
       this Clause 10.3 to have occurred is referred to as the "DATE
       OF TOTAL LOSS".

10.4   DAMAGE CLAIMS

              In the event of repairable damage occurring to the Vessel any
       insurance moneys receivable in respect thereof shall be paid
       to the Lessee.

10.5   THIRD PARTY CLAIMS

              Any insurance moneys paid under the Liability Insurances shall
       be paid to the person to whom the liability (or alleged
       liability) covered by such insurances or entry was incurred,
       or to the person otherwise entitled to it.

10.6   INSUFFICIENT INSURANCE RECOVERY

              In the event of repairable damage to the Vessel or a liability
       or alleged liability covered by the Insurances taken out or
       entries made referred to in Clause 9.1(a) (Insurance
       undertakings) being incurred or alleged, and if the insurance
       moneys paid in respect thereof are insufficient to pay the
       cost or estimated cost of making good or repairing such damage
       or discharging the liability or alleged liability, the Lessee
       will pay the deficiency.

10.7   NOTICE OF ABANDONMENT

              The Lessee shall, subject to the prior written consent of the
       Lessor, be entitled to determine whether or not a case has
       arisen for the giving of notice of abandonment to abandon the
       Vessel to the insurers and/or claim a constructive total loss
       and the Lessee is hereby authorised by the Lessor, following
       the Lessor's consent as specified above, to give such notice
       of abandonment if the Lessee so determines.  Such consent by
       the Lessor shall not be unreasonably withheld if the Lessor is
       indemnified to its satisfaction against any Loss or exposure
       by virtue of the failure of any Assumption which has occurred,
       or which the Lessor reasonably considers may occur, in
       connection with the giving of such notice of abandonment or
       the Total Loss of the Vessel.  Furthermore any consent given
       by the Lessor shall be deemed to be subject to the condition
       that if, after the delivery of a notice of abandonment prior
       to a Total Loss of the Vessel, any Assumption fails or, in the
       Lessor's reasonable opinion becomes likely to fail in
       connection therewith, the Lessee shall indemnify the Lessor to
       the Lessor's satisfaction to cover any increased exposure
       arising or which may arise by virtue of that failure which
       might arise from the giving of such notice of abandonment or
       the Total Loss of the Vessel.

10.8   FURTHER ACTION ON PART OF LESSOR

                   (a) If the Lessee is, pursuant to Clause 10.7 above,
              entitled to give a notice of abandonment, the Lessor
              shall upon the request and at the cost of the Lessee
              promptly execute such documents as may be required to
              enable the Lessee to abandon the Vessel to the insurers
              and/or claim a constructive total loss of the Vessel
              and the Lessor shall, provided that the Lessor is
              indemnified to its reasonable satisfaction against its
              cost of so doing, give the Lessee all reasonable
              assistance in pursuing the said claim, provided that
              the Lessor may (taking into account paragraph (b)
              below) in its absolute discretion, refuse to permit the
              Lessee or any person claiming through the Lessee to
              pursue any such claim in the name of the Lessor or any
              other member of the Lessor's Group.

                   (b) The Lessor shall, at the request of the Lessee 
              consult with the Lessee for a period not exceeding thirty (30)
              days in good faith if the Lessee or any person claiming
              through the Lessee requests permission to pursue any
              claim in the name of the Lessor or any other member of
              the Lessor's Group provided that the Lessor shall be
              under no obligation and have no liability other than to
              the extent of its agreement to hold discussions with
              the Lessee as set out above.

10.9   SALE OF VESSEL FOLLOWING TOTAL LOSS

              If the insurers of the Vessel have satisfied or admitted in
       full their obligations under the Insurances and have expressly
       waived any rights they may have, or would or might require, in
       the Vessel the Lessee shall pursuant to Clause 19.2 (Sale of
       the Vessel) as soon as practicable after the date of Total
       Loss of the Vessel endeavour to arrange a sale of the Vessel. 
       Any such sale shall comply with Clause 19 (Re-delivery and
       sale of the Vessel).

11.    GENERAL COVENANTS AND UNDERTAKINGS OF THE LESSEE

11.1   NOTIFICATION OF RELEVANT EVENT

              The Lessee undertakes with the Lessor that, from the date of
       this Agreement and so long as any moneys are owing under this
       Agreement or any of the other Relevant Lease Documents to
       promptly notify the Lessor of the occurrence of any Relevant
       Event promptly upon becoming aware thereof.

11.2   NOTIFICATION OF TERMINATION OF SUB-LEASE

              The Lessee undertakes with the Lessor that, from the date of
       this Agreement and so long as any moneys are owing under this
       Agreement or any of the other Relevant Lease Documents to
       promptly notify the Lessor of the termination of the
       sub-leasing of the Vessel or the obligation of the Lessee to
       sub-lease the Vessel pursuant to the Sub-Lease at any time
       during the requisite period (as defined in section 40 CAA
       1990).

11.3   SUPPLY OF ACCOUNTS AND FINANCIAL INFORMATION

              The Lessee shall provide to the Lessor (or, as the case may
       be, shall procure that there is provided to the Lessor) such
       reasonably available financial information relating to the
       Lessee as the Lessor may reasonably require.  In particular
       the Lessee shall, from the date of this Agreement and so long
       as any moneys are owing under this Agreement or any of the
       Relevant Lease Documents, properly prepare or cause to be
       properly prepared financial statements for the Lessee in
       respect of each financial year and will deliver or cause to be
       delivered a copy of the same to the Lessor as soon as
       practicable but in any event not later than one hundred and
       twenty (120) days after the end of the financial year to which
       they relate.

11.4   INFORMATION CONCERNING THE VESSEL

              The Lessee undertakes with the Lessor that, from the date of
       this Agreement and so long as any moneys are owing under this
       Agreement, or any of the other Relevant Lease Documents it
       will promptly furnish the Lessor with all such information as
       the Lessor may from time to time reasonably request in writing
       regarding the Vessel, its insurance, condition, maintenance,
       employment, position and engagements, particulars of all
       towages and salvages and copies of all charters, leases and
       other contracts for the employment of the Vessel, or otherwise
       concerning the Vessel.

11.5   NOTIFICATION REQUIREMENTS IN RELATION TO THE VESSEL

              The Lessee shall notify the Lessor in writing promptly at the
       Lessee's cost and expense of:

                   (a) any accident to the Vessel involving repairs the cost
              whereof will or is, in the reasonable opinion of the
              Lessee, likely to exceed an amount equal to ten per
              cent. (10%) of the Lessor's Cost (or the equivalent in
              any other currency);

                   (b) any occurrence in consequence whereof the Vessel has
              become or is, in the reasonable opinion of the Lessee,
              likely to become a Total Loss;

                   (c) any requirement made by any insurer or any material
              requirement made by the Classification Society or by
              any competent authority in relation to the Vessel which
              is not complied with in accordance with its terms;

                   (d) any material assistance which has been given to the
              Vessel which has resulted or may result in a lien for
              salvage being acquired over the Vessel;

                   (e) any material failure to pay promptly and regularly the
              wages and allotments or the insurance and pension
              contributions (if any) of the officers and crew of the
              Vessel;

                   (f) the requisition for hire at any time of the Vessel;

                   (g) any serious or potentially serious injury to an
              individual or group of individuals in an amount
              exceeding five million Dollars ($5,000,000) in
              aggregate (or the equivalent in any other currency)
              caused by, or in connection with, the Vessel;

                   (h) any damage in an amount exceeding five million Dollars
              ($5,000,000) (or the equivalent in any other currency)
              to property caused by, or in connection with, the
              Vessel; and

                   (i) any other event which occurs in connection with the
              Vessel which in the reasonable opinion of the Lessee
              affects or might affect the rights of the Lessor or
              involves or might involve any material loss or
              liability to or of the Lessor.

11.6   TAXES

                   (a) The Lessee shall not and shall procure that each other
              party to the Lease Documents shall not (other than the
              Lessor and the Deposit Bank) claim any capital
              allowances in respect of any expenditure relating to
              the Vessel incurred or to be incurred by the Lessor or
              otherwise in respect of the Vessel which would
              adversely affect the Lessor's claim to capital
              allowances.

                   (b) The Lessee shall pay and discharge from time to time
              all outgoings whatsoever lawfully imposed on the Vessel
              or any income therefrom (other than Taxes) attributable
              to:

                           (i) any Rent or Termination Payment actually
                     receivable hereunder; or

                           (ii) any other amounts payable to and
                     unconditionally received by the Lessor under
                     this Agreement or pursuant to or in connection
                     with any of the other Relevant Lease Documents;
                     or

                           (iii) any sales or other proceeds (including, 
                     without limitation, insurance moneys) actually received
                     and retained by the Lessor in respect of the
                     Vessel as a result of the use, possession,
                     control and command of the Vessel.

                     (c) The Lessee will not use any part of the Vessel or
              permit any part of the Vessel to be used and shall
              procure that no part of the Vessel is used during the
              requisite period (as defined in section 40 CAA 1990) so
              as to result in the application of any of sections 42,
              43, 44, and 46 CAA 1990 and shall immediately notify
              the Lessor if at any time within such requisite period
              the Vessel is used for leasing to a non-resident other
              than permitted leasing, "non-resident" and "permitted
              leasing" bearing for this purpose the meaning set out
              in section 50 CAA 1990 and also notify the Lessor of
              any event or matter which under section 48 CAA 1990
              ought to be notified by the Lessor to the Board of the
              Inland Revenue or any Inspector of Taxes in connection
              with the Vessel or the leasing thereof and shall
              promptly furnish when the Lessor may require such
              information as may properly be required to be so
              furnished by the Lessor to the Board of the Inland
              Revenue and Inspector of Taxes regarding the leasing of
              the Vessel or the use to which it is being put or has
              been put (including any and all correspondence and
              documents which passed between Watson, Farley &
              Williams and the Oil Taxation Office), in order to
              enable the Lessor to comply with the provisions of
              section 48 CAA 1990 or to respond to such a request.

11.7   ENVIRONMENTAL LAWS

              The Lessee shall comply, or procure compliance with, all
       requirements of Environmental Law which are applicable to the
       Vessel, (including, without limitation, obtaining and
       maintaining in full force and effect all Environmental Permits
       required from time to time and all requirements relating to
       manning, submission of oil spill response plans, designation
       of qualified individuals and establishing financial
       responsibility) and promptly notify the Lessor of (i) any
       Environmental Claim which has been made or threatened against
       the Lessor, the Lessee, the Sub-Lessee or which is in relation
       to or is caused by or is in connection with the Vessel and
       which the Lessee is obliged (a) in accordance with the terms
       of the Insurances to report to the relevant insurers and/or
       (b) under any applicable law to report to any Government
       Entity (and for the purposes of (a) and (b) above the proviso
       to the definition of Environmental Claim shall not apply) and
       (ii) any revocation, suspension, amendment, variation,
       withdrawal or refusal to grant any Environmental Permit or any
       requirement relating to the manning, submission of oil
       response plans, designation of qualified individuals and
       establishing financial responsibility.

11.8   OFE
       
              The Lessee will provide to the Lessor from time to time on
       request copies of all supporting invoices in respect of any
       OFE.

12.    OPERATIONAL COVENANTS IN RELATION TO THE VESSEL

12.1   USE OF VESSEL

              The Lessee shall, subject to the provisions of this Agreement,
       as between itself and the Lessor and to the exclusion of the
       Lessor, have full and exclusive use, possession, control and
       command of the Vessel during the Lease Period.

12.2   DESIGN REQUIREMENTS

              The Lessee shall ensure that the Vessel is operated in a
       proper, and safe manner at all times in accordance with its
       design requirements and subject to any limitations placed on
       such operation by that design or any recommendations of the
       Builder or any repairer of the Vessel and in the manner
       prescribed by any legislation in force in any applicable
       jurisdiction.

12.3   COMPLIANCE WITH LAWS AND REGULATIONS

              The Lessee shall not cause nor permit the Vessel to be
       operated in any manner which is contrary to international law
       or any other law, regulation or contractual requirement that
       is applicable to the Vessel or any party to the Lease
       Documents relating to the Vessel or to the exploitation or
       development of any accumulation of hydrocarbons and the Lessee
       shall ensure that the Vessel shall only be utilised in
       accordance with the terms of all applicable permits and
       consents including, but not limited to, any such permit or
       consent from time to time issued by the Classification Society
       or any other body.

12.4   OPERATION IN ACCORDANCE WITH INSURANCE ARRANGEMENTS

              The Lessee will not use the Vessel nor cause nor permit the
       Vessel to be used or operated in any manner or for any purpose
       excepted from any insurance policy or policies or certificate
       or certificates of entry comprising the whole or part of any
       Insurances, or for the purpose of the storage of any goods of
       any description excepted from any such insurance policy or
       policies or certificate or certificates of entry and shall not
       do or permit to be done anything which could be expected to
       invalidate any insurance policy or certificate of entry or the
       Insurances evidenced thereby.

12.5   ALTERATIONS

              The Lessee may at any time alter any items of equipment or fit
       any additional equipment required for the purpose of the
       operation of the Vessel and may make any alteration to the
       type or performance characteristics of the Vessel that it
       considers is necessary or desirable without impairing the
       safety of operation of the Vessel, provided that:

                   (a) if any such alteration or fitting when taken on its
              own or as a series of changes constitutes a substantial
              change to the Vessel (measured by value or by physical
              extent), the Lessee shall promptly notify the Lessor
              thereof in writing;

                   (b) such alterations or additional equipment shall not,
              without the prior written consent of the Lessor,
              materially reduce the value of the Vessel;

                   (c) the Lessee may remove (or permit the removal of)
              additional equipment fitted pursuant to this Clause
              12.5 or any other Excluded Property at any time before
              the expiration of the Lease Period (subject to
              paragraph (b) above) or earlier termination of the
              leasing of the Vessel under this Agreement;

                   (d) subject to the provisions of Clause 19.2, any such
              additional equipment and any other Excluded Property
              which belongs to any member of the Guarantor's Group
              which is not removed pursuant to paragraph (c) above
              prior to the expiration of the Lease Period may be sold
              or otherwise disposed of by the Lessor without the need
              for any further act by the Lessee or any other person. 
              Where that additional equipment or such other Excluded
              Property is in addition to (and not in replacement of)
              the equipment forming part of the Vessel as at the
              Delivery Date, a sum equal to the proceeds of sale or
              other disposal of such additional equipment or such
              other Excluded Property which has been sold or disposed
              of by the Lessor shall be paid to the Lessee as soon as
              practicable after the completion of such sale or other
              disposal; and

                   (e) any equipment (other than the Excluded Property and
              additional equipment altered or replaced in accordance
              with this Clause 12.5) that is removed during the Lease
              Period shall, unless otherwise agreed by the Lessor in
              writing, be replaced at the cost and expense of the
              Lessee prior to the expiration of the Lease Period in
              at least as good a condition as at the time of removal
              (fair wear and tear excepted) and shall be in place and
              in such condition at the expiration of the Lease
              Period.

              The cost of fitting or removing any such additional equipment
       or such other Excluded Property together with the cost of
       making good any damage caused by such fitting or removal shall
       be payable by the Lessee.  The Lessee shall notify the Lessor
       in writing of any material alterations to the Vessel and shall
       provide details of all that is fitted to or removed from the
       Vessel by the Lessee which, in the Lessee's reasonable
       opinion, may have a material adverse impact on the market
       value of the Vessel, within a reasonable period of such
       alterations being carried out, or the fitting or removal of
       such additional equipment or such other Excluded Property.

12.6   MANNING

              The Lessee shall be responsible for providing or procuring
       that there be provided the officers and crew (together the
       "CREW") on board the Vessel who shall remain the employees of
       the Lessee or the Sub-Lessee, or such other person as the
       Lessee or the Sub-Lessee shall engage to provide crewing
       services for the Vessel.  The Crew shall be responsible for
       the manning and operation of the Vessel on behalf of the
       Lessee and, as between the Lessor and the Lessee, at the risk
       of the Lessee.

12.7   EXPENSES INCIDENTAL TO USE AND OPERATION

              The Lessee shall, subject to the provisions of this Agreement,
       be responsible for all expenses, charges and penalties of
       every kind whatsoever incidental to the use and operation of
       the Vessel during the Lease Period and shall ensure that the
       Vessel is kept and maintained in accordance with any law,
       regulation, consent or other requirement from time to time
       applicable to the Vessel.

       12.8   MAINTENANCE AND REPAIR

              The Lessee shall, or shall procure that any Sub-Lessee shall,
       throughout the Lease Period and thereafter until sale of the
       Vessel:

                   (a) at no expense to the Lessor, maintain the Vessel 
              (and each part thereof) in a good state of repair (fair wear
              and tear excepted), in efficient and safe operating
              condition, and in accordance with the Lessee's
              maintenance schedule and practice from time to time and
              shall ensure that the Vessel complies at all times with
              all applicable requirements of the Classification
              Society, the insurers and any applicable law,
              regulations and requirements applicable to equipment of
              a type similar to the Vessel in force at all times and
              shall forward to the Lessor on request subject to
              availability, copies of all certificates as may be
              required for the proper use and operation of the Vessel
              for the time being;

                   (b) procure all repairs to or replacement of any badly
              worn, damaged, broken or lost parts or equipment to be
              effected promptly and in such manner (with regard to
              both workmanship and quality of materials) as not to
              reduce materially the value of the Vessel without the
              prior written consent of the Lessor and the Lessee
              shall be responsible for all costs and expenses so
              incurred; and

                   (c) procure that (to the extent reasonably practicable)
              title to all replacement parts or equipment attached to
              or installed on the Vessel under Clause 12.8(b) shall
              vest (by such delivery) in the Lessor (and the Lessee
              shall, at its cost and expense procure that any
              necessary action is taken to ensure that such vesting
              is effective).

12.9   OBSTRUCTION

              The Lessee shall pay all charges and expenses of every kind
       and nature whatsoever incidental to the use and operation of
       the Vessel under this Agreement and, if the Vessel or any part
       thereof becomes a wreck or an obstruction to navigation, any
       costs and expenses arising which may be incurred by or made or
       asserted against the Lessor in connection with or as a
       consequence of the removal or destruction of the wreck or
       obstruction, provided that the Lessee shall have the right to
       contest in good faith any such charge or expense (and no
       person employed to control or operate the Vessel shall be
       deemed to be a servant of the Lessor for any purpose
       whatsoever) and to this end the Lessor shall upon receipt of
       the written request from the Lessee not unreasonably refuse to
       lend to the Lessee, at the Lessee's expense, all necessary
       assistance in connection with any litigation, arbitration or
       other administrative proceedings to which the Lessee may be a
       party or in which the Lessee may be otherwise involved in
       connection with the contest of the validity or amount of such
       charge or expense provided however that the Lessor may, in its
       absolute discretion, refuse to permit its name or the name of
       the Bank to be used in any manner in any such litigation,
       arbitration or other administrative proceedings.

12.10  INTENTIONALLY OMITTED


12.11  STORAGE AND TRANSPORT OF HYDROCARBONS

              The Lessee shall procure that the Vessel shall not transport
       hydrocarbons or similar substances and, unless the Lessee has
       given the Lessor prior written notice and complied with any
       change in the Insurances required under Clause 9 shall not
       store hydrocarbons or similar substances.

12.12  SAFETY AND OPERATION

              The Lessee shall, or shall procure that the Sub-Lessee shall,
       take such steps as are reasonably practicable to ensure that
       the Vessel and all constituent parts thereof will be safe and
       without risk to health when in use and that the Vessel is not
       operated beyond its specified or recommended limits or
       capacity.  To this end and without prejudice to the generality
       of the foregoing, the Lessee shall ensure that any defects in
       the Vessel which could be or cause a danger to safety and a
       risk to health are repaired and made good so far as is
       reasonably practicable in accordance with the Lessee's normal
       practices.  For this purpose the Lessee shall cause the Vessel
       to be inspected regularly and its various systems tested
       provided that such inspection and testing will only be carried
       out in accordance with and at the interval specified in the
       Lessee's maintenance schedule for the Vessel and otherwise at
       times and in such manner as a prudent operator of vessels of a
       similar type to the Vessel and engaged in a similar trade
       would normally expect to carry out such inspection and
       testing.  The Lessee shall also take all reasonable steps to
       ensure that appropriate safety measures are adopted and all
       provisions of all applicable laws, codes and regulations
       relating to the Vessel are complied with and the Lessee shall
       ensure or procure where required by any applicable law that at
       all times the Vessel is subject to a Safety Management System
       which complies in all respects with the ISM Code and has a
       valid Safety Management Certificate and that there is a valid
       Document of Compliance which is applicable to the Vessel.

12.13  OPERATIONAL CONTROL

              The Lessor acknowledges that, as between itself and the
       Lessee, the Lessee shall have the full operational control of
       the Vessel, but without prejudice to the right of the Lessor
       following the delivery by it of a Termination Notice to
       repossess the Vessel in accordance with Clause 21.7.

12.14  CONSENTS

              The Lessee shall procure that at all times during the Pre-
       Lease Period and the Lease Period there are maintained in full
       force and effect all relevant authorisations (governmental and
       otherwise) and will promptly obtain any further authorisation
       in each case which are or may become necessary for the
       operational use of the Vessel or the performance of any of the
       transactions contemplated by this Agreement and the other
       Lease Documents (other than the performance of the Payment
       Agreements by Payment Banks).

12.15  GOOD PRACTICE

              The Lessee shall ensure that in all respects the Vessel will
       be operated and maintained to comply in all material respects
       with all applicable laws in accordance with good oil field and
       marine practice.

12.16  SERVICE CONTRACTS AND SERVICE CONTRACTOR'S OIL POLLUTION
       INDEMNITY

       (A)    The Lessee shall provide to the Lessor on or shortly prior to
       or, if that is impractical, as soon as practical after, the
       Sub-Lessee entering into a Service Contract a certificate
       executed by a duly authorised officer of the Lessee certifying
       that:

                  (i) the Sub-Lessee or, if applicable and subject to the
              terms of this Agreement, the Lessee is about to enter
              into or, as the case may be, has entered into a Service
              Contract;

                  (ii) the Lessee has complied with its obligations under
              Clause 12.16(B); and

                  (iii) either (a) that the relevant extracts of the Service
              Contract or other agreement, document or instrument
              attached to such certificate are true and complete
              extracts of the relevant provisions of the Service
              Contact or, as the case may be, such other agreement,
              document or instrument containing an indemnity or
              indemnities with respect to oil pollution for the
              benefit of the Indemnified Persons (either expressly or
              by an indemnity or indemnities in favour of a class of
              persons within which the Indemnified Persons fall) by
              operation of the third party beneficiary doctrine under
              the law governing the Service Contract or other
              document or instrument or (b) that the Service
              Contractor refused to give any such indemnity or
              indemnities.

       (B)    The Lessee shall use all reasonable efforts and endeavours to
       procure that each Service Contractor grants an indemnity or
       indemnities in compliance with clause 12.16(A)(iii)(a).

12.17  ARREST AND DETENTION

       If the Vessel is at any time during the Lease Period:

                   (a) arrested, seized, taken into custody or otherwise
              detained by any court or other tribunal or by any
              Government Entity (other than by a Compulsory
              Acquisition or any requisition for hire or by reason of
              a Lessor's Lien); or

                   (b) subjected to distress or other legal proceedings by
              reason of any process, claim, the exercise of any
              rights conferred by a Lien or by any other action
              whatsoever (other than by reason of a Lessor's Lien),

              the Lessee shall procure the release of the Vessel from such
       arrest, seizure or detention within twenty-one (21) days of
       receiving notice thereof by providing bail or otherwise as the
       circumstances may require.  The Lessor acknowledges and
       accepts that the Lessee shall, unless and until a Relevant
       Event shall have occurred which is continuing, have the sole
       right to contest any litigation, arbitration or administrative
       proceedings in respect of the foregoing and the Lessor shall,
       upon receipt of the written request from the Lessee and being
       secured to the Lessor's satisfaction against its costs and
       expenses of so doing, not unreasonably refuse to render all
       necessary assistance as the Lessee may reasonably require in
       connection therewith, provided however that the Lessor may, in
       its absolute discretion, refuse to permit its name or the name
       of the Bank to be used in any manner in any such litigation,
       arbitration or other proceedings. 

12.18  REGISTRATION

                   (a) The Lessee shall not do and shall procure that each
              other party to the Lease Documents (other than the
              Lessor and the Deposit Bank) shall not do anything or
              permit anything to be done whereby the registration of
              the Vessel under the laws of the Flag State may be
              forfeited or imperilled.

                   (b) The Lessee shall comply with and procure the 
              compliance with the provisions of all applicable laws and
              regulations necessary to maintain the registration of
              the Vessel under the laws of the Flag State.

12.19  NOTICE OF LEASE

                   (a) The Lessee shall place and keep or procure that there
              is placed and kept prominently displayed in the control
              room of the Vessel throughout the Lease Period a framed
              printed notice in plain type in English of such size
              that the paragraph of reading matter shall cover a
              space of not less than six (6) inches wide by nine (9)
              inches high, reading substantially as follows:

                    "NOTICE OF LEASE"

                    "This Vessel is the property of [Lessor] (the "LESSOR")
              and is subject to a head lease granted by the Lessor in
              favour of [Lessee] (the "LESSEE").  This Vessel is
              subject to a sub-lease granted by the Lessee in favour
              of [UK lessee] (the "SUB-LESSEE").

                     Neither the Lessee, the Sub-Lessee and any Service
              Contractor, nor any manager, nor any servant or agent
              of any thereof has any authority whatsoever to contract
              on behalf of the Lessor or to pledge the credit of the
              Lessor or the involvement of the Lessor in any
              liability whatsoever and none of the Lessee, the Sub-
              Lessee, any Service Contractor, any manager of this
              vessel and any other person has any right, power or
              authority to create, incur or permit to be imposed upon
              this vessel any Lien whatsoever except for general
              average, crew's wages or salvage."

                      The Lessee undertakes that it shall not place or permit
              to be placed in or on the Vessel any other notice
              dealing with the rights of any person without the prior
              written consent of the Lessor.

                     (b) The Lessee undertakes not to remove or cover up the
              notice specified in Clause 12.19(a).

                     (c) The Lessee shall carry a true and complete copy of 
              this Agreement with the Vessel's papers and on demand
              exhibit the same to any person having business with the
              Vessel which might reasonably be considered to give
              rise to any Lien other than any Permitted Lien.

12.20  TRANSFER OF FLAG OR REGISTRY OF VESSEL

              The Lessee may at any time and from time to time during the
       Lease Period request the Lessor to transfer the register of
       the Vessel to any port and/or to re-document the Vessel under
       the laws of any jurisdiction other than the port and/or
       jurisdiction at which the Vessel is for the time being
       registered and/or under whose laws the Vessel is for the time
       being documented.  If the Lessor approves of such transfer of
       register and/or re-documentation of the Vessel (such approval
       not to be unreasonably withheld or delayed, provided always
       that it shall be reasonable for the Lessor to withhold its
       consent if the Lessor demonstrates to the Lessee (by producing
       a legal opinion from legal counsel of the Lessor's choice
       qualified and practising in the relevant jurisdiction to which
       the registration of the Vessel is to be transferred) that the
       Lessor's ownership and/or liability position will be adversely
       affected by such transfer of register and/or re-documentation
       of the Vessel), the Lessor shall, at the request of the
       Lessee, co-operate with and permit the Lessee to take all
       necessary steps to comply with such request and thereafter
       shall during the Lease Period co-operate with the Lessee to
       take such action as the Lessee may reasonably require (but
       only in such manner and upon such conditions as the Lessor may
       approve (such approval not to be unreasonably withheld or
       delayed) and, if such approval is given, subject to such
       conditions as the Lessor may reasonably impose and provided
       always that it shall be reasonable for the Lessor to withhold
       its approval or impose conditions if it demonstrates to the
       Lessee (by producing a legal opinion from legal counsel of the
       Lessor's choice qualified and practising in the relevant
       jurisdiction to which the registration of the Vessel is to be
       transferred) that the Lessor's ownership and/or liability
       position will be adversely affected if the Lessor gives such
       approval and/or does not impose such conditions) to maintain
       the documentation of the Vessel at the port to which the
       register of the Vessel is so transferred and/or under the laws
       of the jurisdiction under whose laws the Vessel is so re-
       documented.

              If the Lessor demonstrates to the Lessee (by producing a legal
       opinion from legal counsel of the Lessor's choice qualified
       and practising in the relevant jurisdiction) that it has
       become impossible or unlawful for the Lessor to maintain the
       documentation of the Vessel under the laws of any jurisdiction
       under whose laws the Vessel is for the time being documented
       or the Lessor demonstrates to the Lessee (by producing a legal
       opinion from legal counsel of the Lessor's choice qualified
       and practising in the relevant jurisdiction in which the
       registration of the Vessel is currently located) that its
       ownership is or is likely to be imperilled or otherwise
       adversely affected under such law or that the liabilities to
       which it is or is likely to become exposed have increased to
       what is, in the opinion of the Lessor, an unacceptably high
       level, the Lessor shall give notice thereof to the Lessee and
       the Lessee shall forthwith enter into negotiations in good
       faith with a view to agreeing upon the Vessel remaining
       documented under the laws of the jurisdiction under which it
       is documented at that time or an alternative jurisdiction for
       the documentation of the Vessel, but if no such agreement
       shall be reached within thirty (30) days after the Lessor
       shall have given such notice to the Lessee, the Lessor shall
       be at liberty to take and/or require the Lessee to take such
       action to re-document the Vessel and/or to transfer the
       registry of the ship to a port of registry in such registry as
       the Lessor, acting reasonably, considers appropriate having
       regard to the Lessor's ownership of the Vessel and/or the
       Lessor's liability position and the operational requirements
       for the Vessel by the Lessee, the Sub-Lessee and the Service
       Contractor and in either case the Lessee shall do all that may
       be necessary on its part to give effect to such re-
       documentation and/or transfer of register.

              The Lessee shall indemnify and hold harmless the Lessor
       against all losses, costs, expenses and liabilities of
       whatsoever nature which the Lessor may suffer or incur and
       which arise directly or indirectly out of the documentation of
       the Vessel at a different port and/or under the laws of any
       jurisdiction following a request by the Lessee or the Lessor
       in accordance with the foregoing provisions of this Clause
       12.20, including the costs incurred by the Lessor in obtaining
       a legal opinion under this Clause (whether the transfer of the
       register of the Vessel is requested by the Lessor or the
       Lessee and irrespective of whether the registration of the
       Vessel is changed). 


13.    BENEFIT OF THIRD PARTY WARRANTIES

       13.1   The Lessor agrees to assign absolutely to the Lessee upon the
       request of the Lessee from time to time or at any time after
       Delivery:

                   (a) all or any of the rights and interests in and to all
              warranties and indemnities given by the Builder, each
              OFE Supplier and each other manufacturer, repairer or
              supplier of any part of the Vessel to the extent that
              the same are vested in the Lessor and are capable of
              assignment; and

                   (b) all or any of the rights and interests in and to all
              claims and rights of action whatsoever of the Lessor
              against the Builder under the Shipbuilding Contract and
              any OFE Supplier (other than those referred to in sub-
              clause (a) above) and all guarantees, letters of credit
              or other security for the Builder's, each Supplier's
              and each other manufacturer's, repairer's or Supplier's
              OFE obligations to the extent that the same have been
              vested in the Lessor by or pursuant to the Shipbuilding
              Contract and are capable of assignment.

       13.2   The Lessee shall be entitled, as assignee of the Lessor by
       virtue of Clause 13.1, to take action in its own name against
       the Builder, each OFE Supplier, each other manufacturer,
       repairer or supplier and such other applicable party referred
       to in Clause 13.1.

       13.3   The Lessor shall, upon the Lessee's request, promptly give
       notice to the Builder, any OFE Supplier or other applicable
       party referred to in Clause 13.1 of the assignment contained
       in Clause 13.1, each such notice to be in form and substance
       mutually agreed by the Lessor and the Lessee.

       13.4   Without prejudice to the assignments contained in Clause 13.1,
       to the extent that such assignments may not be effective to
       vest in the Lessee the full benefit of all rights and claims
       purportedly assigned (including the right to be compensated in
       the same amount as that to which the Lessor would have been
       entitled had the assignment not taken place), the Lessee shall
       be entitled, subject to the Lessee first ensuring that the
       Lessor is indemnified or secured from time to time and at all
       times to its satisfaction by the Lessee against all potential
       costs and expenses to be incurred, to take action in the name
       of the Lessor in respect of all or any of the matters referred
       to in Clause 13.1 to commence or conduct private arbitration
       proceedings (that is to say the proceedings themselves are
       conducted in private and the arbitrator's award is given and
       known only to the parties to the arbitration) against the
       Builder, any OFE Supplier and any other manufacturer, repairer
       or supplier of any part of the Vessel and any other applicable
       party referred to above, provided that:

                   (a) the Lessee shall in all circumstances keep the Lessor
              fully informed and have due regard to the wishes of the
              Lessor in relation to the use of the Lessor's name,
              acknowledging the Lessor's interest in preserving, in
              the UK financial community, the Lessor's and its
              immediate or ultimate parent company's reputations as
              financial institutions and their respective business
              interests and customer relationships to the extent that
              such interests and relationships are reasonably likely
              to be affected in a materially adverse way as a result
              of the commencement and/or conduct of such arbitration
              proceedings;

                    (b) if private arbitration proceedings are commenced the
              Lessor shall permit the Lessee to have the conduct of
              such proceedings but (i) the Lessor shall be entitled
              to join in the conduct of such proceedings at any time
              and (ii) the Lessee shall give timely notice to the
              Lessor of any meetings with Counsel or attendance at
              the arbitration, and the Lessor shall be entitled to
              attend any such meetings or attendances PROVIDED THAT
              following the service of a Termination Notice the
              Lessee shall cease to have, and the Lessor shall have,
              sole conduct of such proceedings in the Lessor's name;

                    (c) the Lessor shall be entitled to charge for, and the
              Lessee shall pay for, the Cost of Management Time
              incurred in respect of or in connection with any such
              private arbitration proceedings; and

                    (d) if the Lessee notifies the Lessor that it does not
              intend to appeal any award made against the Lessor by
              the arbitrator or the Lessee does not satisfy the award
              within the time allowed by applicable law for an
              appeal, the Lessor shall be entitled to satisfy the
              award.

       13.5   The provisions of Clause 13.5 shall apply mutatis mutandis
       with respect to any court proceedings which the Lessee wishes
       to commence in the name of the Lessor in respect of all or any
       of the matters referred to in Clause 13.1 (whether prior to
       the arbitration proceedings referred to in Clause 13.4 or by
       way of an appeal from the award of the arbitrator in such
       proceedings) on the basis that references in Clause 13.4(a) to
       "private arbitration proceedings", "arbitration proceedings",
       "arbitration" and "proceedings" shall be construed as
       references to court proceedings and (b) to the "arbitrator's
       award" or the "award" shall be construed as a reference to an
       order of any competent court and the second set of words in
       parentheses in the first paragraph of Clause 13.4 shall be
       disregarded.  In addition, following receipt by the Lessee of
       a certificate signed by an officer of the Bank of at least the
       level of Managing Director, Corporate and Institutional
       Financial Services (or the equivalent of such officer from
       time to time) certifying that the Bank is of the opinion that
       the continued taking by the Lessee of any action in the name
       of the Lessor and/or, as the case may be, the continued use by
       the Lessee of the Lessor's name in any court proceedings is
       affecting or will affect in any adverse way whatsoever the
       Lessor's or its immediate or ultimate parent company's
       reputations as financial institutions in the UK financial
       community and/or their respective business interests and/or
       customer relationships, then, if the Lessor is the plaintiff
       in any such proceedings, the Lessee shall no longer be
       entitled to, and shall not, take any action or, as the case
       may be, any further action in the name of the Lessor or use
       the Lessor's name in any such proceedings and if the Lessor is
       the defendant in any such proceedings, the Lessee shall cease
       to have, and the Lessor shall have, sole conduct of such
       proceedings in its own name.

       13.6   The Lessor shall, subject to the provisions of Clause 13.4 in
       the applicable circumstances and subject to being indemnified
       or secured by the Lessee against all potential costs and
       expenses to be incurred, take all such further actions as the
       Lessee may reasonably require in order to confer on the Lessee
       the full benefit of the rights and claims referred to in
       Clause 13.1

14.    INSPECTION

14.1   Without imposing or implying any obligation on the Lessor, the
       Lessor may inspect, and may instruct an agent on its behalf,
       at any reasonable time upon reasonable notice, to inspect the
       Vessel.

14.2   The costs of such inspection shall be borne by:

                   (a) the Lessor if, at the time of the inspection, no
              Termination Event has occurred which is continuing and
              such inspection reveals that all provisions of this
              Agreement with regard to the operation and maintenance
              of the Vessel are being substantially complied with;
              and

                   (b) the Lessee in each other case.

14.3   Provided no Termination Event has occurred which is
       continuing, the Lessor agrees that no such inspection shall
       (a) take place more than once a year or (b) interfere with the
       operation, maintenance or repair of the Vessel.

14.4   The Lessor also agrees that it or its agent shall comply with
       all safety, fire and operational regulations and instructions
       which may be given on the occasion of any inspection.

15.    RISK

            Throughout the Pre-Lease Period and the Lease Period and until
       redelivery of the Vessel in accordance with Clause 19.1
       (Re-delivery of the Vessel), the Vessel shall, as between the
       Lessor and the Lessee, be in every respect at the risk of the
       Lessee.  The Lessee shall bear all risks howsoever arising
       whether of navigation of the Vessel or the operation or
       maintenance of the Vessel (or any part thereof) or otherwise. 
       The Lessee agrees that the Lessor shall not be liable for any
       liability, claim, loss, damage or expense of any kind or
       nature caused directly or indirectly by the Vessel or any part
       thereof or any inadequacy thereof for any purpose or any
       deficiency or defect therein or the use or performance thereof
       or any repairs or servicing thereto or any delay in providing
       or failure to provide any thereof or any interruption or loss
       of service or use thereof or any loss of business or other
       consequential damage or any damage whatsoever and howsoever
       caused or any other matter which but for this provision might
       operate to frustrate this Agreement, save for direct losses
       and expenses suffered or incurred by the Lessee (including any
       losses and expense against which the Lessee is obliged to
       indemnify any third party irrespective of any limit on the
       right of recourse by that third party to the Lessee or its
       assets) which result solely from a breach by the Lessor of its
       express and specific obligations under the Relevant Lease
       Documents to which it is party.

16.    REQUISITION FOR HIRE

       16.1   If the Vessel is requisitioned for hire by any Government
       Entity during the Lease Period, the leasing of the Vessel
       shall continue in full force and effect for the remainder of
       the Lease Period and the Lessee shall remain fully responsible
       for the due compliance with all its obligations under this
       Agreement other than in respect of provisions which the Lessee
       is precluded from performing as a result of such requisition.

       16.2   The Lessee shall be entitled to all requisition hire paid to
       the Lessor or to the Lessee by such Government Entity or other
       competent authority on account of such requisition in respect
       of the Vessel and shall be entitled to all requisition hire
       paid in respect of the Vessel, whether during or following the
       expiration or earlier termination of the Lease Period.

       16.3   The Lessee shall be under no liability to the Lessor in
       respect of any change in the structure, state and condition of
       the Vessel in so far as such change is due to the manner in
       which the Vessel has been used or treated or to the events
       that have occurred during the period of requisition. 
       Nonetheless the Lessee shall ensure that any compensation
       payable by the requisitioning authority in respect of such
       change shall, unless the Lessor otherwise agrees in writing:

                    (a) if received after the occurrence of a Total Loss
              which is continuing, be paid to the Lessor and until payment
              be held on trust for the Lessor; and

                    (b) otherwise be retained by the Lessee,

                    and, in each such case, applied in accordance with 
              Clause 16.4 or 16.5.

       16.4   Any such compensation as is referred to in Clause 16.3 which
       is received prior to the end of the Lease Period shall, unless
       the Lessor otherwise agrees in writing be applied:

                    (a) first if received and permitted to be retained by the
              Lessee pursuant to Clause 16.3, by the Lessee in or
              towards restoring the Vessel (so far as is possible) to
              the condition which it is in at the time the
              requisition took place;

                    (b) secondly if received by the Lessor, by the Lessor in
              reimbursement of the Lessee of any amounts expended by
              the Lessee in or towards restoring the Vessel (so far
              as is possible) to the condition which it was in at the
              time the requisition took place or, as the case may be,
              in making direct payment to any relevant shipyard or
              other repairer or supplier; and

                    (c) thirdly, provided that the Vessel has at such time (so
              far as is possible) been restored to the condition
              which it was in at the time the requisition took place,
              in payment by the Lessor to the Lessee or (as the case
              may be) retention by the Lessee for its own account of
              any surplus as if it were requisition for hire.

       16.5   Any such compensation as is referred to in Clause 16.3 which
       relates to any period after the end of the Lease Period shall
       be paid by the Lessor to or, as the case may be, retained by
       the Lessee.

       16.6   In the event that the Vessel shall at the end of the Lease
       Period for any reason whatsoever be under requisition for hire
       the provisions of this Agreement in respect of re-delivery and
       sale of the Vessel shall unless the Lessor otherwise agrees in
       writing apply at the end of the period of requisition for hire
       regardless that the Lease Period shall have expired before the
       end of the requisition period.

17.    SALVAGE

              All salvage and towage and all proceeds from derelicts shall
       be for the Lessee's benefit and the cost of repairing damage
       occasioned thereby shall be borne by the Lessee.

18.    TITLE AND LIENS

       18.1   TITLE

              During the Pre-Lease Period, title to the Vessel as it is
       constructed shall pass to the Lessor in accordance with the
       provisions of the Shipbuilding Contract and during the Lease
       Period the Vessel shall at all times be the property of and
       belong to the Lessor.  Nothing in the Lease Documents shall
       have the effect of or be deemed to have the effect of passing
       title or beneficial ownership of the Vessel or any part
       thereof to the Lessee or any Sub-Lessee or any Service
       Contractor.  For the avoidance of doubt, it is expressly
       agreed that none of the Lessee or any Sub-Lessee or any
       Service Contractor shall, as against the Lessor, have an
       option or right to acquire title to or any proprietary right
       or interest in or to all or any of the Vessel.

       18.2   LIENS

                   (a) The Lessee shall not and shall procure that each
              Security Party shall not (save as provided in Clause
              19.2(d) (Sale of the Vessel) or pursuant to the
              Relevant Lease Documents) sell nor purport to sell the
              Vessel or any part thereof.

                   (b) Subject to Clause 12.17, the Lessee shall not and shall
              procure that each Security Party shall not create,
              incur or permit to arise or be imposed on the Vessel
              any Lien, other than Permitted Liens, and the Lessee
              shall pay and discharge (or provide bail in respect of)
              all debts, damages and liabilities whatsoever which may
              have given or may give rise to any Lien or claim
              enforceable against the Vessel (other than those which
              may have given or may give rise to Lessor's Liens).

19.    RE-DELIVERY AND SALE OF THE VESSEL

       19.1   RE-DELIVERY OF THE VESSEL

                   (a)  Except in the event of a Total Loss (other than as
              provided in Clause 10.7 (Notice of abandonment), in
              which event Clause 19.1(c) shall apply) and except
              where a sale of the Vessel has been arranged in
              accordance with Clause 19.2 and title to the Vessel is
              transferred to the purchaser thereof at the end of the
              Lease Period and subject to the provisions of Clauses
              16.6 and 21.7, the Lessee shall at the end of the Lease
              Period re-deliver the Vessel together with all
              certificates relating to the Vessel to the Lessor free
              of all Liens (other than Liens falling within
              paragraphs (i), (ii), or (vi) of the definition of
              Permitted Liens), and the Lessor shall accept such re-
              delivery, at the Redelivery Location.  Subject to the
              provisions of Clause 16.6, the Lessee shall at its
              expense before such re-delivery make all such repairs
              and do all such work as may be necessary so that the
              Vessel at the date of re-delivery shall be:

                          (i) unless otherwise agreed by the Lessor in
                     writing, such state of repair and operating
                     condition as it is required to be maintained in
                     accordance with the provisions of this
                     Agreement, fair wear and tear and changes and
                     alterations properly made by the Lessee as
                     permitted under this Agreement excepted;

                           (ii) with all required certificates in full force
                     and effect; and

                           (iii) with all equipment, fittings, spare and
                     replacement parts installed in or on, or which
                     are attached to, or which are part of the
                     Vessel in accordance with this Agreement other
                     than Excluded Property which was entitled to be
                     (and was) removed prior to re-delivery in
                     accordance with Clause 12.5 (Alterations).

                            The cost of satisfying the requirements specified
              in paragraphs (i) to (iii) above and remedying any defects
              or deficiencies shall be borne by the Lessee or the
              Lessee shall pay to the Lessor the cost of effecting
              the same.

                     (b) At or about the time of re-delivery following a
              termination of the leasing of the Vessel pursuant to
              Clause 21.3 (Termination by Lessor) or following the
              end of a period of requisition for hire which ends
              after the expiration of the Lease Period and unless a
              sale of the Vessel has been arranged in accordance with
              Clause 19.2 and title to the Vessel is transferred to
              the purchaser thereof on the Termination Date and
              subject to Clause 21.7, a survey shall, if the Lessor
              so requires, be made to determine the state and
              condition of the Vessel.  In that event, the Lessee and
              the Lessor shall each appoint surveyors to be present
              at such survey and the surveyors present shall
              determine the condition of the Vessel and shall state
              the repairs or work necessary to place the Vessel at
              the date of re-delivery in the structure, state and
              condition required to demonstrate compliance by the
              Lessee with the repair and maintenance covenants
              contained in this Agreement.  If the said surveyors
              disagree they shall refer the matter to a senior
              surveyor of the Classification Society whose decision
              shall be final and binding on the parties hereto.  All
              reasonable costs occasioned by any such survey
              including the costs of the said surveyors appointed by
              the Lessee and the Lessor and, if appointed, the costs
              of the senior surveyor of the Classification Society
              shall be payable by the Lessee, but if the Vessel is
              found by such senior surveyor to be in the condition
              provided for in this Agreement, fair wear and tear
              alone and changes and alterations properly made by the
              Lessee as permitted under this Agreement excepted, such
              reasonable costs shall be payable by the Lessor.  If
              the Lessee fails to appoint a surveyor as specified,
              the survey shall be conducted by the Lessor's appointee
              alone and references to the "senior surveyor" in this
              Clause shall be ignored.

                     (c) In the event of a Total Loss to which Clause 10.9
              applies, the Lessee shall, at the Lessee's cost and
              expense, re-deliver the Vessel and all Surviving Parts
              to the Lessor at such location and upon such other
              terms and conditions as the Lessor and the Lessee may
              agree at such time.

       19.2   SALE OF THE VESSEL
       
                     (a) Upon any termination of the leasing of the Vessel 
              (or, as the case may be, the right of the Lessee to take the
              Vessel on Lease (but subject always to the rights of
              the Lessor under clause 3 of the Put Option Deed))
              under this Agreement through effluxion of time or
              otherwise (but in the case of a Total Loss, only to the
              extent that the Lessor is free to dispose of the same)
              the Vessel shall be sold in accordance with the
              remaining provisions of this Clause 19.2.

                     (b) To the extent of its entitlement to act as the 
              Lessor's sales agent in accordance with paragraph (d) below, 
              the Lessee shall have the right to decide the means, timing
              and terms of disposal of the Vessel subject always to
              compliance with paragraphs (c) and (d) below.

                     (c) Any sale pursuant to this Clause 19 shall comply with
              the following conditions:

                         (i) the sale shall be at a cash price payable by
                     the purchaser in full on completion in Dollars
                     or such other currency as the Lessor may agree
                     (such agreement not to be unreasonably
                     withheld) direct to the Lessor for credit to
                     the account designated by the Lessor;

                         (ii) the sale shall be at a price which (excluding
                     VAT or other similar taxes wheresoever and
                     howsoever arising) shall be not less than the
                     higher of the open market value of the Vessel
                     and the Tax Written Down Value;

                         (iii) the sale may be to any person other than:

                                  (A) the Lessee; or

                                  (B) the Sub-Lessee; or

                                  (C) any person who is purchasing on behalf
                            of or in trust for the Lessee or the
                            Sub-Lessee; or

                                  (D) any person who is purchasing as part of
                            an arrangement under which title will or
                            may pass to any of the persons mentioned
                            in (A) and (B) above;

                         (iv) the sale shall be made upon terms which do not
                     expose the Lessor or any member of the Lessor's
                     Group to any liability, including but not
                     limited to any Tax Liability (excluding
                     Corporation Tax chargeable on capital gains and
                     any Tax Liability arising out of a disposal for
                     Capital Allowances) which it would not have had
                     but for execution of the relevant sale
                     documents (save for liability for breach of the
                     warranty set out in this Clause 19.2(c)) unless
                     the Lessor or the relevant member of the
                     Lessor's Group shall first have been
                     indemnified and/or secured to its satisfaction
                     against any such liability, and otherwise
                     without any representation, recourse or
                     warranty whatsoever to or on the part of the
                     Lessor or any member of the Lessor's Group
                     other than a warranty that the Lessor shall
                     pass such title to the Vessel as the Lessor has
                     acquired pursuant to the Shipbuilding Contract
                     subject to Liens, save for Lessor's Liens
                     Provided that the Lessee shall be entitled to
                     make any representation or warranty with
                     respect to the Vessel strictly on its own
                     behalf without recourse whatsoever to or on the
                     part of the Lessor or any member of the
                     Lessor's Group;

                          (v) a sale shall be on an "as is, where is and with
                     all faults" basis and governed by the laws of
                     England;

                          (vi) a sale shall exclude, so far as permitted by
                     the laws of England and any other laws
                     governing or applicable to the sale of the
                     Vessel, all liability of the Lessor or any
                     member of the Lessor's Group, in contract or
                     tort, in relation to the Vessel to the same
                     extent as such liabilities are excluded by
                     Clause 5 (disclaimers and exclusions) but save
                     for the warranty given by the Lessor under
                     Clause 19.2(c)(iv); and

                           (vii) if the Vessel is at the date of entry into
                     any contract for the sale of the Vessel subject to
                     any requisition for hire, the sale shall be
                     subject to such requisition.

                            The Lessee shall, whether or not the Vessel is 
              sold through the Lessee as sales agent pursuant to Clause
              19.2(d) and whether or not the Vessel is in the
              possession of the Lessee, the Sub-Lessee or the Lessor,
              indemnify the Lessor on demand and keep the Lessor
              indemnified on a full indemnity basis (subject to
              Clause 25.2 (exclusions from general indemnity) against
              all Losses from time to time suffered or incurred by or
              made against the Lessor which are connected with the
              repossession, re-delivery, storage, maintenance,
              protection, sale or attempted sale of the Vessel.

                     (d) The Lessee is hereby irrevocably appointed by the
              Lessor as its sole and exclusive marketing agent for
              the Vessel (but shall not be entitled to any fee or
              commission for acting as the Lessor's sales agent) any
              sale of the Vessel to be completed only at the time of
              or following the expiration or earlier termination of
              the leasing of the Vessel pursuant to this Agreement,
              PROVIDED THAT:

                          (i) such agency shall cease to be on a sole and
                     exclusive basis and shall be instead on a joint
                     (together with the Lessor) and a non-exclusive
                     basis if no sale has been completed within one
                     year of the expiration or earlier termination
                     of the Lease Period (or such longer period as
                     the Lessor may agree in writing); and

                          (ii) the authority of the Lessee is limited to the
                     extent that the Lessee shall not be authorised
                     to sell the Vessel or any part thereof or to
                     approve or execute on behalf of the Lessor any
                     document (including, but not limited to, any
                     term sheet or heads of terms) relating to the
                     sale of the Vessel, but the Lessor agrees that
                     it shall, at the Lessee's cost and expense upon
                     reasonable notice, execute such agreement as
                     may be requested for the sale of the Vessel
                     provided that the same complies with the
                     provisions of Clause 19.2(c).

                     (e) The Lessor shall indemnify and hold the Lessee and 
              each other member of the Guarantor's Group harmless on a
              full indemnity basis from any Losses suffered or
              incurred by the Lessee or any other member of the
              Guarantor's Group which would not have arisen but for,
              and only but for, the following:

                         (i) the failure of the Lessor to sell the Vessel
                     following receipt by the Lessor of a request by
                     the Lessee to sell in compliance with the
                     provisions of this Clause 19.2; and/or

                         (ii) any actual or purported revocation of the
                     marketing agency contained in Clause 19.2(d) by
                     operation of law,

                     except, in either case, where the circumstances
              referred to in (i) or (ii) above arise by operation of,
              or as a result of compliance by the Lessor with,
              applicable law (other than where the operation of, or
              compliance with, applicable law would not have arisen
              but for, and only but for, an Insolvency Event in
              relation to the Lessor).  The Lessee shall hold the
              benefit of the indemnity contained in this
              Clause 19.2(e) on trust for the other members of the
              Guarantor's Group.

20.    PROCEEDS OF SALE

20.1   PROCEEDS OF SALE

              The "PROCEEDS OF SALE" of the Vessel shall be (i) the total
       proceeds of sale thereof (excluding Value Added Tax and other
       similar taxes wheresoever and howsoever arising but including
       any non-refundable deposit paid by a person proposing to
       acquire the Vessel under a contract or offer to purchase which
       has been withdrawn, terminated, cancelled or has lapsed)
       unconditionally received by the Lessor; or (ii) any capital
       sums unconditionally received by the Lessor, before Delivery,
       by way of purchase price for (or compensation for the loss of)
       the Lessor's rights under the Shipbuilding Contract.  If the
       Vessel is sold in a currency other than Sterling the "PROCEEDS
       OF SALE" thereof shall be the amount of Sterling which the
       Lessor is able to purchase with the foreign currency by
       reference to the spot rate of exchange of the Bank for
       purchasing Sterling with such currency which it receives for
       such sale on the day of receipt of such foreign currency or as
       soon thereafter as foreign exchange transactions are able to
       be made in the City of London.

20.2   APPLICATION OF PROCEEDS OF SALE

            Following the termination or expiration of the leasing of the
       Vessel and if the completion of a sale or other disposition of
       the Vessel or the rights and obligations of the Lessor under
       the Shipbuilding Contract takes place, the Proceeds of Sale
       (or any part thereof) shall be applied by the Lessor
       immediately (or, if it is not possible for the Lessor to apply
       the same immediately, then on the next Business Day) as
       follows:

                   (i) firstly, in retention by the Lessor of an amount equal
              to one per cent. (1.0%) of the amount by which such
              Proceeds of Sale exceed the applicable Termination
              Payment; and

                   (ii) secondly, the Lessor shall pay an amount equal to the
              balance, if any, of such money to the Lessee by way of
              rebate of Rent.

21.    TERMINATION PROVISIONS
       
       21.1   TERMINATION EVENTS

              The Lessor and the Lessee agree that it is a fundamental term
       and condition of this Agreement that none of the following
       events shall occur at any time after the date of this
       Agreement, and that the occurrence of any of the following
       events shall constitute a repudiation of this Agreement by the
       Lessee:

                   (a) the Lessee, the Guarantor or any Additional Security
              Provider who is a member of the Guarantor's Group fails
              to pay any amount due to the Lessor under this
              Agreement or any other Relevant Lease Document which
              constitutes a Remaining Obligation on the due date and
              such default is not remedied within three (3) Business
              Days after the Lessee or the Guarantor or such
              Additional Security Provider is notified by the Lessor
              of such non-payment; or

                    (b) the Lessee fails to obtain and/or maintain or procure
              that there are obtained and maintained the Insurances
              or if any insurer in respect of any of such Insurances
              cancels any of such Insurances or disclaims liability
              by reason, in either case, of mis-statement in any
              proposal for any of such Insurances or for any other
              failure or default on the part of any person (other
              than the Lessor) PROVIDED THAT it shall not be a
              Termination Event under this Clause 21.1(b) if such
              Insurances are Hull Insurances and the Lessor arranges
              for such Hull Insurances to be reinstated within ten
              (10) Business Days of the date of such failure or, as
              the case may be, the date of such cancellation or
              disclaiming of liability; or

                     (c) the Lessee, the Guarantor or any Additional Security
              Provider who is a member of the Guarantor's Group fails
              to observe or perform any of its obligations under any
              Relevant Lease Document to which it is party (other
              than an obligation referred to in paragraph 21.1(a) or
              21.1(b) above or Clause 21.1(l) or 21.1(m) or 21.1(n)
              or 21.1(o) below or any obligation which is an Excluded
              Obligation) and does not remedy the failure within
              thirty (30) days of receipt by the Lessee or, as the
              case may be, the Guarantor of a notice from the Lessor
              notifying the Lessee or, as the case may be, the
              Guarantor of the relevant failure and requiring the
              failure to be remedied; or

                     (d) an Insolvency Event occurs in relation to the Lessee
              or the Guarantor or any Additional Security Provider which
              is a member of the Guarantor's Group; or

                     (e) the Lessee or the Guarantor suspends or ceases or 
              makes a public announcement or otherwise threatens in writing
              to suspend or cease to carry on its business; or

                     (f) any Financial Indebtedness of the Guarantor or any
              Material Subsidiary (US) of the Guarantor in an amount
              of at least twenty-five million Dollars ($25,000,000)
              (or its equivalent in another currency) is declared due
              and payable before its stated maturity; or

                     (g) any representation or warranty made by the Lessee or
              the Guarantor in any Relevant Lease Document or, in
              each case, in any certificate, opinion or statement
              delivered or made by the Lessee or the Guarantor (or
              any officer of such person in each case) pursuant
              thereto proves to have been incorrect or inaccurate in
              a material respect when made or when deemed to be
              repeated pursuant to the terms of the relevant Relevant
              Lease Document and such action as is necessary such
              that if the relevant representation or warranty was
              made or given thereafter it would then be correct and
              accurate has not been taken within thirty (30) days of
              receipt by the Lessee or, as the case may be, the
              Guarantor of a notice from the Lessor notifying the
              Lessee or, as the case may be, the Guarantor of such
              incorrection or inaccuracy; or

                     (h) any obligation of any member of the Guarantor's Group
              under a Relevant Lease Document ceases to be a legal,
              valid and binding obligation in accordance with its
              terms and, where such illegality, invalidity or
              unenforceability is capable of cure, the same has not
              been cured within fourteen (14) days of receipt by the
              Lessee of a notice from the Lessor notifying the Lessee
              of such illegality, invalidity or unenforceability and
              requiring the same to be cured; or

                     (i) any licence, authorisation, permit, consent or 
              approval of, or registration with or declaration to,
              governmental or public bodies or authorities or courts
              required in connection with the use and operation of
              the Vessel or to authorise any member of the
              Guarantor's Group to enter into any of the Relevant
              Lease Documents or the Sub-Lease or required in
              connection with the validity, enforceability or
              admissibility in evidence of any of the Relevant Lease
              Documents or the Sub-Lease is modified, not granted,
              revoked, suspended, terminated or expires or is not
              renewed or otherwise ceases to be in full force and
              effect in each case the effect of which would be to
              have a material adverse effect on the ability of any of
              the parties to the Relevant Lease Documents to perform,
              or to continue to perform, any of their respective
              obligations under the Relevant Lease Documents; or

                     (j) intentionally omitted; or

                     (k) the Lessee (other than as the Lessor's sales agent
              within the scope of its authority under Clause 19.2),
              the Sub-Lessee or a Service Contractor shall sell,
              mortgage or execute a bill of sale affecting the Vessel
              or any interest therein or any part thereof or agree or
              endeavour to create any Lien (other than a Permitted
              Lien) over the Vessel or any interest therein; or

                     (l) the Lessee shall fail to comply with its obligations
              under Clause 22.3 to provide the Additional Security or
              voluntarily to terminate the leasing or, as the case
              may be, the obligation to lease the Vessel pursuant to
              Clause 21.4; or

                     (m) the Lessee shall fail to comply with its obligations
              under Clause 22.6(C) within the time stated in that
              Clause; or

                     (n) the Vessel is operating in a jurisdiction in respect of
              which the circumstances described in Clause
              9.1(a)(ii)(z) apply and the Lessee has failed to
              increase the amount of oil pollution liability
              insurance with respect to the Vessel in the amount
              required under Clause 9.1(a)(ii)(z) within the time
              required under Clause 9.1(b); or

                     (o) at any time during the requisite period (as defined 
              in section 40 CAA 1990) circumstances occur with respect
              to the Vessel which result in the application of any of
              sections 42, 43, 44 and 46 CAA 1990 (including for the
              avoidance of doubt, where the leasing of or, as the
              case may be, the obligation to lease the Vessel under
              any Sub-Lease shall terminate for any reason whatsoever
              (other than after the end of the requisite period (as
              defined in section 40 CAA 1990)) in circumstances where
              such Sub-Lease is not replaced, prior to such
              termination, with a replacement Sub-Lease to a
              Sub-Lessee that will not result in the application of
              any of sections 42, 43, 44 and 46 CAA 1990).

       21.2   INTENTIONALLY OMITTED

       21.3   TERMINATION BY LESSOR

              The Lessee acknowledges and agrees that the occurrence of a
       Termination Event shall go to the root of this Agreement and
       accordingly shall be a breach of a condition which the Lessor
       shall be entitled to treat as a repudiation by the Lessee of
       this Agreement and the Lessor shall be entitled to give a
       notice ("TERMINATION NOTICE") to the Lessee to terminate the
       leasing of the Vessel and, subject to Clause 21.7, the
       Lessor's consent to the Lessee's possession of the Vessel or,
       if Delivery has not occurred, to terminate the obligation of
       the Lessor to take delivery of and lease the Vessel to the
       Lessee.

       21.4   MANDATORY VOLUNTARY TERMINATION

                    (A) If any of the circumstances referred to in clause 3.2
              of the Put Option Deed have occurred and notice is
              given under clause 3 of the Put Option Deed prior to
              Delivery then (a) the Lessor shall promptly notify the
              Lessee thereof in writing, (b) the Lessee, upon
              receiving such notification, shall serve a notice in
              writing upon the Lessor (which notice, subject to item
              (c) below, shall be irrevocable once given) to
              terminate the Lessor's obligation to deliver and lease
              the Vessel to the Lessee hereunder, such notice to
              expire ten (10) days after it is given (or if such
              tenth day is not a Business Day, on the next succeeding
              Business Day) and (c) provided no Termination Notice
              shall have been given prior to the expiry of the
              Lessee's notice described in item (b) above (in which
              event such notice given by the Lessee shall be deemed
              to have been withdrawn and cancelled and the provisions
              of Clause 21.7 shall apply), on the date of the expiry
              of such notice given by the Lessee the obligation of
              the Lessor to deliver and to lease the Vessel to the
              Lessee shall terminate.

                     (B) If:

                         (i) no entity proposed by the Lessor pursuant to
                     clause 5.5 of either Payment Agreement as the
                     "Replacement Payment Bank" is acceptable to the
                     Lessee or the relevant Payment Bank; or

                         (ii) no entity proposed by the Lessee in exercise of
                     its rights under Clause 5.2(d) as the
                     "Replacement Payment Bank" under the relevant
                     Payment Agreement is acceptable to the Lessor,
                     and

                                  (x) neither the relevant Payment Bank nor
                            the Lessor has exercised its rights
                            pursuant to clause 5.1, 5.2, 5.3, 5.5 or
                            5.6 of the relevant Payment Agreement to
                            make the payment described in clause 5.7
                            of the relevant Payment Agreement to the
                            Lessor or at its direction; and

                                   (y) the Lessee has not exercised its 
                            rights under Clause 5.2(d) to require the
                            Lessor to exercise its rights pursuant
                            to clause 5.6 of the relevant Payment
                            Agreement to make the payment described
                            in clause 5.7 of the relevant Payment
                            Agreement to the Lessor or at its
                            direction or has not revoked its request
                            to the Lessor under Clause 5.2(d)(ii)
                            requiring the Lessor to exercise its
                            rights pursuant to clause 5.6 of the
                            relevant Payment Agreement to make the
                            payment described in clause 5.7 of the
                            relevant Payment Agreement to a
                            Replacement Payment Bank.

                            then (a) the Lessor shall promptly notify the 
              Lessee thereof in writing, (b) the Lessee, upon receiving such
              notification, shall serve a notice in writing upon the
              Lessor (which notice, subject to item (c) below, shall
              be irrevocable once given) to terminate the Lessor's
              obligation to deliver and lease the Vessel to the
              Lessee hereunder or, if Delivery has occurred, the
              leasing of the Vessel to the Lessee hereunder, such
              notice to expire three (3) Business Days after it is
              given and (c) provided no Termination Notice shall have
              been given prior to the expiry of the Lessee's notice
              described in item (b) above (in which event such notice
              given by the Lessee shall be deemed to have been
              withdrawn and cancelled and the provisions of Clause
              21.7 shall apply), on the date of the expiry of such
              notice given by the Lessee the obligation of the Lessor
              to deliver and lease the Vessel to the Lessee hereunder
              or, if Delivery has occurred, to lease the Vessel to
              the Lessee, shall terminate.

                   (C) If the Lessor has served an Acceleration Notice on the
              Lessee, then (a) the Lessee, upon receiving the
              Acceleration Notice, shall serve a notice in writing
              upon the Lessor (which notice, subject to item (b)
              below, shall be irrevocable once given) to terminate
              the leasing of the Vessel to the Lessee hereunder, such
              notice to expire fifteen (15) days after it is given
              and (b) provided no Termination Notice shall have been
              given prior to the expiry of the Lessee's notice
              described in item (a) above (in which event such notice
              given by the Lessee shall be deemed to have been
              withdrawn and cancelled and the provisions of Clause
              21.7 shall apply), on the date of the expiry of such
              notice given by the Lessee the obligation of the Lessor
              to lease the Vessel to the Lessee shall terminate.

                   (D) If any obligation of any party to a Relevant Lease
              Document ceases to be a legal, valid and binding
              obligation in accordance with its terms (except where
              the party in question is (a) a member of the
              Guarantor's Group, (b) the Deposit Bank or a Payment
              Bank or the Lessor and the same would not have arisen
              but for, and only but for, the occurrence of an
              Insolvency Event in relation to the Deposit Bank or
              that Payment Bank or the Lessor or (c) is a Replacement
              Deposit Bank and the same would not have arisen but
              for, and only but for, the Deposit Bank being a
              Replacement Deposit Bank and such illegality,
              invalidity or unenforceability would not have been
              caused or would not have arisen had the Deposit Bank
              been the Bank) and, where such illegality, invalidity
              or unenforceability is capable of cure, the same has
              not been cured within fourteen (14) days of receipt by
              the Lessee of a notice from the Lessor notifying the
              Lessee of such illegality, invalidity or
              unenforceability and requiring the same to be cured
              then (i) the Lessor shall promptly notify the Lessee
              thereof in writing, (ii) the Lessee, upon receiving
              such notification, shall immediately serve a notice in
              writing upon the Lessor (which notice, subject to item
              (iii) below, shall be irrevocable once given) to
              terminate the Lessor's obligation to deliver and lease
              the Vessel to the Lessee hereunder, such notice on the
              day it is given and (iii) provided no Termination
              Notice shall have been given prior to the expiry of the
              Lessee's notice described in item (ii) above (in which
              event such notice given by the Lessee shall be deemed
              to have been withdrawn and cancelled and the provisions
              of Clause 21.7 shall apply), on the date of the expiry
              of such notice given by the Lessee the obligation of
              the Lessor to deliver and to lease the Vessel to the
              Lessee shall terminate.

                   (E) Any licence, authorisation, permit, consent or 
              approval of, or registration with or declaration to,
              governmental or public bodies or authorities or courts
              required in connection with the use and operation of
              the Vessel or to authorise any of the parties to the
              Relevant Lease Documents (other than the Lessor, the
              Deposit Bank and any member of the Guarantor's Group)
              or the Sub-Lessee to enter into any of the Relevant
              Lease Documents or the Sub-Lease or required in
              connection with the validity, enforceability or
              admissibility in evidence of any of the Relevant Lease
              Documents or the Sub-Lease is modified, not granted,
              revoked, suspended, terminated or expires or is not
              renewed or otherwise ceases to be in full force and
              effect in each case the effect of which would be to
              have a material adverse effect on the ability of any of
              the parties to the Relevant Lease Documents to perform,
              or to continue to perform, any of their respective
              obligations under the Relevant Lease Documents, then
              (a) the Lessor shall promptly notify the Lessee thereof
              in writing, (b) the Lessee, upon receiving such
              notification shall immediately serve a notice in
              writing upon the Lessor (which notice, subject to item
              (c) below, shall be irrevocable once given) to
              terminate the Lessor's obligation to deliver and lease
              the Vessel to the Lessee hereunder, such notice to
              expire on the day it is given and (c) provided no
              Termination Notice shall have been given prior to the
              expiry of the Lessee's notice described in item (b)
              above (in which event such notice given by the Lessee
              shall be deemed to have been withdrawn and cancelled
              and the provisions of Clause 21.7 shall apply), on the
              date of the expiry of such notice given by the Lessee
              the obligation of the Lessor to deliver and to lease
              the Vessel to the Lessee shall terminate.

                   (F) Upon any termination of the leasing of the Vessel
              pursuant to Clause 6.3, 21.4(B), 21.4(C), 21.4(D) or
              21.4(E) the Lessee shall redeliver the Vessel to the
              Lessor at the Redelivery Location within ninety (90)
              days of the date of such termination (unless or until
              the circumstances described in Clause 21.7(a)(ii) (x)
              and/or (y) occur, in which case the Lessee shall
              redeliver the Vessel to the Lessor forthwith at the
              Redelivery Location) and otherwise in accordance with
              Clause 19.1 and shall arrange a sale of the Vessel
              pursuant to its rights in Clause 19.2 (Sale of the
              Vessel) in accordance with the provisions of Clause
              19.2 as soon as possible after such termination.

21.5   PAYMENTS ON TERMINATION

                   (a) On the Termination Payment Date the Lessee shall pay 
              to the Lessor an amount equal to the Termination Payment,
              calculated as at the Termination Payment Date, except
              as otherwise specifically provided in the Financial
              Schedule.

                   (b) For the avoidance of doubt, the Lessee shall, except 
              as expressly otherwise stated in the Relevant Lease
              Documents with respect to any Primary Period Rent or
              any Secondary Period Rent which falls due on or after
              the Termination Payment Date, continue to be liable to
              the Lessor to pay all other sums due or to become due
              under the Relevant Lease Documents (including, without
              limitation, Broken Funding Costs) as and when the same
              become due and payable in accordance with the Relevant
              Lease Documents.

                   (c) The payment required from the Lessee pursuant to 
              Clause 21.5(a) shall, in the case of a notice given by the
              Lessor pursuant to Clause 21.3, be by way of agreed
              compensation for loss of bargain and, in all other
              cases, shall be by way of a liquidated sum or debt. 
              Such payment shall be the exclusive monetary
              compensation payable by the Lessee to the Lessor for
              the termination of the leasing of the Vessel but shall
              be without prejudice to:

                          (i) the Lessor's right to recover damages from 
                     the Lessee in an amount up to (but not exceeding)
                     the Termination Payment in circumstances where
                     the Termination Payment itself is unenforceable
                     (in whole or in part) for any reason; and

                          (ii) the Lessor's right to recover payments from 
                     the Lessee pursuant to other provisions of this
                     Agreement and the Financial Schedule which
                     expressly provide for the Lessee to make
                     payments to the Lessor, whether before or after
                     the Termination Date.

                          This Clause 21.5 is, for the avoidance of doubt,
              expressly subject to the provisions of Clause 23.

21.6   OTHER OBLIGATIONS AND LIABILITIES

              If the leasing of the Vessel or, as the case may be, the right
       of the Lessee to take the Vessel on lease, is terminated
       (otherwise than following a Total Loss, in which case Clause
       10.1 (Total Loss) shall apply), the obligation of the Lessee
       to pay Primary Period Rent or Secondary Period Rent which
       would otherwise have fallen due on any Rent Payment Dates
       which fall on or after the Termination Payment Date shall
       cease but without prejudice to the obligations of the Lessee
       to make payment of any other moneys then due and unpaid, or
       which may become due or be ascertained thereafter (including
       under the Financial Schedule and whether by way of additional
       Rent or otherwise), or to perform any of its other
       obligations, under any other provisions of this Agreement or
       the other Relevant Lease Documents.

21.7   RIGHTS OF THE LESSOR

                   (a) The Lessor shall on and at any time following the
              service of a Termination Notice be entitled to:

                          (i) proceed by appropriate court action or actions
                     to enforce performance of this Agreement or to
                     recover damages for the breach of this
                     Agreement PROVIDED THAT the Lessor shall not be
                     entitled to recover damages for loss of bargain
                     if the Termination Payment has been paid in
                     full to the extent the Termination Payment and
                     any interest on it constitutes a Remaining
                     Obligation; and/or

                          (ii) either:

                               (A) take possession of the Vessel, for which
                            purpose the Lessor may enter any
                            premises belonging to or in the
                            occupation of or under the control of
                            the Lessee or the Sub-Lessee or the
                            Service Contractor where the Vessel may
                            be located, or cause the Vessel to be
                            redelivered to the Lessor at the
                            Redelivery Location; or

                                (B) by serving notice require the Lessee to
                            redeliver the Vessel to the Lessor at
                            the Redelivery Location,

                            PROVIDED THAT the Lessor shall not be entitled
                     to exercise its rights under this Clause
                     21.7(ii) for a period of ninety (90) days
                     following its service of a Termination Notice
                     unless or until either:

                                        (x) the Termination Event described
                                   in Clause 21.1(b) has occurred
                                   and is continuing with respect to
                                   the Liability Insurances; and/or

                                        (y) the Termination Event described
                                   in Clause 21.1(d) has occurred
                                   and is continuing with respect to
                                   the Lessee.

                    For the avoidance of doubt, the Lessor shall not be
              obliged to take possession of the Vessel under Clause
              21.7(ii)(A) following a termination of the leasing of
              the Vessel under this Agreement.

                    (b) Without prejudice to the obligations of the Lessee to
              pay to the Lessor the Termination Payment in accordance
              with Clause 21.5, following the service of a
              Termination Notice the Lessee shall endeavour to sell
              the Vessel as soon as possible in accordance with the
              terms of Clause 19.2 (Sale of the Vessel).

22.    SECURITY AND SECURITY REVIEW

22.1   THE GUARANTEE

              The Lessor shall at all times during the Pre-Lease Period and
       the Lease Period and for so long thereafter as the Lessee may
       have any actual or contingent obligations or liabilities
       hereunder or under any of the other Relevant Lease Documents
       have the benefit of the Guarantee from the Guarantor.

22.2   GUARANTOR CREDIT EVENT OCCURRENCE

              If a Guarantor Credit Event shall occur:

                   (a) the Lessee shall promptly notify the Lessor of such
              occurrence.  Within twenty-one (21) days of the date
              (the "GUARANTOR CREDIT EVENT OCCURRENCE DATE"), upon
              which a Guarantor Credit Event occurs the Lessee shall
              provide Additional Security to the Lessor in accordance
              with the provisions of Clause 22.3; 

                   (b) the Strip Limits applying for all Calculation Periods
              from and including the Guarantor Credit Event
              Occurrence Date up to the subsequent Guarantor Credit
              Event Cure Date will be zero PROVIDED THAT following
              the occurrence of the third Guarantor Credit Event
              Occurrence Date which occurs during the Lease Period,
              the Strip Limits applying for all Calculation Periods
              from and including such third Guarantor Credit Event
              Occurrence Date will be, and will remain, zero; and

                   (c) on each of the first and second Guarantor Credit Event
              Cure Date which occur during the Lease Period the Strip
              Limit shall be the Revised Strip Limit and thereafter
              the Strip Limits shall be calculated in accordance with
              the provisions of this Agreement.

22.3   TERMINATION SHORTFALLS

              The Lessee covenants with the Lessor that, prior to the
       termination of the leasing of (or the right or obligation to
       lease) the Vessel under this Agreement, within twenty-one (21)
       days of the delivery by the Lessor to the Lessee of a New
       Schedule 2 which shows a Termination Shortfall for any date
       (including any Relevant Date), the Lessee shall:

                  (a) procure the provision to the Lessor of additional
              security of a type from a person and upon terms
              acceptable to the Lessor in its absolute discretion
              such that the value of such additional security for
              that date (being the value realised by the Lessor for
              payment into the Second Account) will equal that
              Termination Shortfall; or

                  (b) pay or cause to be paid into the Second Account an
              amount in Sterling which is, at the date of payment,
              the present value of that Termination Shortfall
              calculated using a discount rate of LIBID for any
              period for which, as at the date of calculation, LIBID
              can be ascertained or a discount rate reflecting a
              reasonable annual market rate for periods for which no
              rate for LIBID can then be ascertained, with rests on
              each Adjustment Date.

22.4   CASH SECURITY
       
              If the Lessee has provided cash security under Clause 22.3(b),
       the Lessee and the Lessor agree that they shall, without
       obligation, discuss in good faith for a period not exceeding
       thirty (30) days the possibility of substituting an
       alternative form of Additional Security for such cash
       security.

22.5   SUBSTITUTION OF NEW SCHEDULE 2 PARTS A, B AND C
       
              The Lessor and the Lessee hereby agree that, subject to Clause
       23.3, within twenty-eight (28) days (or such lesser period as
       the Lessor shall determine) after any of:

                   (a) the first day of a Deposit Period (as defined in the
              First Deposit Deed); or

                   (b) the determination by the Lessor that any of the
              Assumptions or, as the case may be, the Termination
              Assumptions shall not be correct, such that the
              schedule 1 which then applies is incorrect; or

                   (c) a payment by either or both of the Payment Banks to the
              Lessor pursuant to any of clause 5.1, 5.2, 5.3, 5.4,
              5.5 or 5.6 of either or both of the Payment Agreements;
              or

                   (d) the service by the Lessor of any written notice on
              either Payment Bank pursuant to clause 5.5 or 5.6 of
              the relevant Payment Agreement, whether or not the
              relevant Payment Bank makes the payment required
              pursuant to that notice; or

                   (e) the occurrence of any event which entitles any Provider
              of Security to make any withholding or deduction on
              account of Taxes or any illegality which relieves that
              Provider of Security from making any payment under the
              document or documents constituting or evidencing the
              relevant security or Additional Security; or

                   (f) the provision of any Additional Security; or

                   (g) the occurrence of a Guarantor Credit Event or the
              occurrence of the first and second Guarantor Credit
              Cure Event to occur during the Lease Period; or

                   (h) the service by the Lessor of a Lessor Payment Notice 
              or an Interest Period Notice (as each such term is defined
              in each Payment Agreement); or

                   (i) any other change which would, in the Lessor's opinion,
              affect the calculations inherent in Schedule 2,

              the Lessor shall produce a New Schedule 2 to this Agreement
       which shall (save in the case of manifest error) be
       substituted by the Lessor for the Schedule 2 which applied
       immediately prior to such substitution.  Each New Schedule 2
       shall, until itself substituted, constitute Schedule 2 to this
       Agreement and references to Schedule 2 in this Agreement shall
       be construed accordingly.

22.6   RELEASE AND REPLACEMENT OF ADDITIONAL SECURITY

       (A) The Lessor agrees that, prior to the termination of the
       leasing of (or the right or obligation to lease) the Vessel
       under this Agreement, within five (5) Business Days of the
       delivery by the Lessor to the Lessee of a New Schedule 2 which
       shows the Strip Limit for the Calculation Period in which the
       date upon which such New Schedule 2 was produced by the Lessor
       falls exceeding the Strip Amount for such Calculation Period,
       then the Lessor shall, provided no Relevant Event has occurred
       and is continuing, release and/or discharge all or any part of
       the Additional Security selected by the Lessor with a value
       (being the Value for such Additional Security if it were paid
       into the Second Account) equal to the amount of such excess
       and thereafter shall produce a New Schedule 2 to this
       Agreement in respect of which the final paragraph of Clause
       22.5 shall apply.

       (B) If, following the occurrence of a Guarantor Credit Event, a
       Guarantor Credit Cure Event occurs (the date upon which such
       Guarantor Credit Cure Event occurs being the "GUARANTOR CREDIT
       EVENT CURE DATE"), the Lessee shall promptly notify the Lessor
       of such occurrence and within five (5) Business Days of such
       notification the Lessor shall, provided no Relevant Event has
       occurred and is continuing, release and/or discharge the
       Additional Security provided by the Lessee under Clause
       22.2(a) following the occurrence of such Guarantor Credit
       Event PROVIDED THAT:

                   (i) the Lessor shall only be obliged to release and/or
              discharge any Additional Security referred to above
              following the occurrence of the first and second
              Guarantor Credit Cure Events to occur during the Lease
              Period and shall not be so obliged following the
              occurrence of the third or any other Guarantor Credit
              Cure Event which occurs during the Lease Period; and

                   (ii) the provisions of this Clause 22.6(B) are
       without prejudice to the Lessor's subsequent and continuing
       rights under Clause 22.2 to require the Lessee to provide
       Additional Security on the dates specified in that Clause.

       (C) If any of the following shall occur in relation to any
       Additional Security Provider who is not a member of the
       Guarantor's Group:

                   (i) any obligation of such Additional Security Provider 
              in any of the Additional Security Documents executed by
              such Additional Security Provider ceases for any reason
              (other than by reason of the occurrence of an
              Insolvency Event in relation to such Additional
              Security Provider) to constitute the legal, valid,
              binding and enforceable obligation of such Additional
              Security Provider; or

                   (ii) if such Additional  Security Provider fails to pay 
              any amount due under any of the Additional Security
              Documents executed by it and such failure is not
              remedied within three (3) Business Days after such
              Additional Security Provider is notified by the Lessor
              of such non-payment; or

                   (iii) if such Additional Security Provider fails to 
              observe or perform any of its obligations (other than those
              referred to in paragraph (ii) above) under any
              Additional Security Documents executed by it and does
              not remedy the failure within thirty (30) days of
              receipt of a notice by the Lessor requiring such
              failure to be remedied; or

                   (iv) if such Additional Security Provider ceases to be a
              member of the group of which it was a member at the
              time when it executed any Additional Security
              Documents; or

                   (v) an Insolvency Event occurs in relation to any
              Additional Security Provider who is not a member of the
              Guarantor's Group,

              then the Lessee shall, within twenty-one (21) days of being
       notified by the Lessor of the occurrence of any of the above
       events, provide the Lessor with further additional security to
       replace the Additional Security provided by such Additional
       Security Provider (the "REPLACED ADDITIONAL SECURITY") in form
       and content acceptable to the Lessor and of a value
       (calculated on the same basis under this Agreement as the
       Value of the Replaced Additional Security) equal to the
       Replaced Additional Security.

23.    EXCLUDED OBLIGATIONS

23.1   EXCLUDED OBLIGATIONS

            The parties hereto agree that the Lessee shall have no
       obligation to make payment to the Lessor and accordingly the
       Lessor shall have no right of recourse against the Lessee or
       its assets (other than to either of the First Account or the
       Second Account and any moneys to be released in accordance
       with the Deposit Deeds standing to the credit of either of
       such accounts) and the Lessee shall have no personal
       liability:

                   (a) in respect of each instalment of Primary Period Rent,
              to the extent of an amount (calculated for the due date
              for payment of the relevant instalment) equal to the
              aggregate of:

                          (i) the amount payable by each Payment Bank on the
                     date for payment of the relevant instalment
                     under clause 4.1 of each of the Payment
                     Agreements (ignoring for these purposes the
                     provisions of clauses 4.1, 4.6 and 5.7 of each
                     of the Payment Agreements entitling the
                     relevant Payment Bank to make any withholding
                     or deduction from such instalment) less the
                     aggregate of (A) the amount, if any, of any
                     withholding or deduction which the Payment
                     Banks are or will be entitled to make from such
                     amount payable under the Payment Agreements and
                     (B) any amount which, by virtue of invalidity,
                     illegality or unenforceability, either Payment
                     Bank is relieved from its obligation to make
                     payment on such date under the relevant Payment
                     Agreement (other than by virtue of any
                     invalidity, illegality or unenforceability
                     which would not have arisen but for, and only
                     but for, the occurrence of an Insolvency Event
                     in relation to the relevant Payment Bank); and

                          (ii) the amount deposited in the First Account
                     together with the amount of interest which has
                     accrued thereon in accordance with the First
                     Deposit Deed up to the date for payment of the
                     relevant instalment less the aggregate of (A)
                     the amount of any withholding or deduction
                     which the Deposit Bank is or will be entitled
                     to make from any payment from the First Account
                     under the terms of the First Deposit Deed and
                     (B) any amounts in the First Account in respect
                     of which there is at the date for payment of
                     the relevant instalment Restricted Access 

                                (the "RENT LIMIT"); and

                     (b) in respect of the Termination Rent, to the extent 
              of an amount equal to the Value (calculated for the relevant
              Termination Payment Date) of the Termination Security
              then held by the Lessor (the "TERMINATION LIMIT"),

              the obligations of the Lessee described in (a) and (b) above
       being the ("EXCLUDED OBLIGATIONS"), provided that for the
       purposes of Clause 23.1(b), (i) the Value of any Non-Deposit
       Bank Cash Additional Security delivered to the Lessor shall be
       disregarded unless, at the time the relevant Non-Deposit Bank
       Cash Additional Security is provided to the Lessor, the Lessor
       agrees that the Lessor shall have no right of recourse against
       the Lessee or its assets, and the Lessor shall have no
       personal liability, to the extent of the Value of that Non-
       Deposit Bank Cash Additional Security and (ii) for the
       avoidance of doubt, where it is illegal for any Provider of
       Security to make payment to the Lessor of amounts which would
       otherwise constitute Termination Security or the obligations
       of that Provider of Security become unenforceable by the
       Lessor by reason of illegality (other than by reason of any
       illegality which would not have arisen but for, and only but
       for, the occurrence of an Insolvency Event in relation to that
       Provider of Security), the Value to be attributed to the
       relevant security shall only be the amount of money actually
       received and retained by the Lessor.

23.2   REMAINING OBLIGATIONS

              Save insofar as the Lessor has agreed to relinquish its rights
       against the Lessee or its assets under, or as referred to in,
       Clause 23.1, the Lessor shall have full recourse against the
       Lessee and its assets for all of the obligations of the Lessee
       under the Relevant Lease Documents (but without prejudice to
       Clause 29(B)).  Accordingly and without limiting the
       generality of the foregoing, to the extent that the amount of
       any instalment of Primary Period Rent exceeds the Rent Limit
       or the amount of any Termination Rent exceeds the Termination
       Limit the Lessee shall be obliged to make payment of the
       relevant excess in full and the Lessor shall have full
       recourse to the Lessee and to its assets to the extent that
       such payment is not made.

23.3   NOTICE OF RESTRICTED ACCESS

              The Lessor shall, upon becoming aware of the same, give
       written notice to the Lessee that there is Restricted Access
       to the moneys standing to the credit of either of the First
       Account or the Second Account and the Lessor shall take no
       action (other than the delivery of any relevant notices or
       demands) against the Lessee or its assets (other than the
       moneys standing to the credit of the First Account or the
       Second Account) for a period (the "MORATORIUM") of ten (10)
       Business Days thereafter to recover any amounts which are
       subject to such Restricted Access and shall not produce a New
       Schedule 2 to this Agreement during the Moratorium.  If during
       the Moratorium the Lessee (at its own cost and expense)
       obtains and delivers to the Lessor a written opinion from
       English legal counsel (such counsel being reasonably
       acceptable to the Lessor) that there is a reasonable prospect
       of successfully obtaining an order of the High Court in London
       to effect a release of the moneys which are subject to such
       Restricted Access, the Moratorium shall be extended for a
       further period of ten (10) Business Days, but, subject to the
       further provisions of this Clause 23.3, will then end.  If
       during the Moratorium there ceases to be Restricted Access to
       the relevant moneys, sub-paragraph (cc) of paragraph (b) of
       the definition of "VALUE" and sub-paragraph (B) of Clause
       23.1(a)(ii) shall cease to apply thereto.

       23.4   APPLICATION TO HIGH COURT

              If counsel's opinion as specified in Clause 23.3 is obtained
       and delivered to the Lessor within the time specified, the
       Lessor shall, upon its being indemnified to its satisfaction
       against any costs, expenses, losses and liabilities which may
       be suffered or incurred by the Lessor so doing, give to the
       Lessee such assistance as may be reasonably requested for the
       purpose of making an application to the High Court in London
       or an order as contemplated in Clause 23.3, including (if the
       Lessor so agrees in its absolute discretion) the use of the
       Lessor's name in making such application.

24.    CHANGE OF CIRCUMSTANCES ETC.

24.1   CHANGE OF CIRCUMSTANCES

              This Clause 24.1 applies, otherwise than where a payment is
       made in respect of the effect of a Change of Law in accordance
       with the provisions of the Financial Schedule, if at any time
       the Lessor shall be of the opinion that the effect of a Change
       of Law (excluding any introduction or change that relates to
       the Taxation of the Lessor or any member of the Lessor's
       Group, but including, without limitation, any such change that
       relates to the application or modification of any reserve,
       deposit, cash ratio, liquidity or similar requirement or to
       capital adequacy or that affects the manner in which or the
       extent to which the Lessor or any Relevant Member allocates
       capital resources to its obligations or to any other form of
       banking or monetary controls) is that:

                   (a) the Lessor or a Relevant Member incurs a cost or an
              additional cost as a result of the Lessor having
              entered into or assuming, performing, maintaining or
              funding its obligations under or pursuant to any of
              this Agreement or the other Relevant Lease Documents;
              or

                   (b) the Lessor or a Relevant Member incurs a cost or an
              additional cost in making payment of, funding or
              maintaining all or any amounts of Balance, or all or
              any commitments or obligations under or pursuant to any
              of this Agreement or the other Relevant Lease
              Documents; or

                   (c) any amount payable to the Lessor or a Relevant Member
              or the effective return to the Lessor or a Relevant
              Member under or pursuant to any of this Agreement or
              the other Relevant Lease Documents or on all or any of
              its capital is reduced; or

                   (d) the Lessor or a Relevant Member makes any payment or
              foregoes any interest or other return on or calculated
              by reference to any amount received or receivable by it
              under or pursuant to any of this Agreement or the other
              Relevant Lease Documents.

24.2   DEMANDS BY LESSOR
       
              If Clause 24.1 applies, then the Lessor may serve one or more
       demands on the Lessee, notifying the Lessee of the relevant
       event as and when the same shall occur and reasonable details
       of the basis of the calculation of the amount referred to in
       Clause 24.3 provided that the Lessor shall not be entitled to
       serve any demand in respect of a Change of Law which arises as
       a consequence of (or of any law or regulation implementing)
       (a) the proposals for international convergence of capital
       measurement and capital standards published by the Basle
       Committee on Banking Regulations and Supervisory Practices in
       July 1988 and/or (b) any applicable directive of the European
       Union (in each case) unless it results from any change in such
       proposals or any such applicable directive (or any law or
       regulation implementing the same) occurring or change in the
       official interpretation or application thereof after the date
       hereof.  For the purposes of this Clause 24.2 the term
       "APPLICABLE DIRECTIVE" means (exclusively) each of the Own
       Funds Directive (89/299/EEC of 17th April 1989) and the
       Solvency Ratio Directive (89/647/EEC of 18th December, 1989).

24.3   PAYMENT BY THE LESSEE

              Promptly following the service of any demand, the Lessee shall
       pay to the Lessor such amount as the Lessor determines and
       certifies in the demand will compensate it or a Relevant
       Member for the applicable increased cost and in relation to
       the period expressed to be covered by such demand.

24.4   MEANING OF "INCREASED COST"

       In this Clause 24 "INCREASED COST" means the aggregate of:

                   (a) the cost or additional cost incurred referred to in
              Clause 24.1 (a); and/or

                   (b) the cost or additional cost incurred referred to in
              Clause 24.1 (b) that is attributable to the Lessor or
              the Relevant Member in making payment of, funding or
              maintaining all or any amounts of Balance, or all or
              any commitments or obligations under or pursuant to any
              of this Agreement or the other Relevant Lease
              Documents; and/or

                   (c) the reduction in the amount payable or in the return
              referred to in Clause 24.1 (c); and/or

                   (d) the payment or foregone interest or return referred 
              to in Clause 24.1(d) as appropriate;

                          PROVIDED THAT an increased cost does not include:

                          (i) any increased cost compensated for by the
                     payment of PLA Costs;

                          (ii) any Tax Liability; and

                          (iii) any Risk Asset Weighting.

24.5   METHOD OF CALCULATION

            When calculating an increased cost, the Lessor may allocate or
       spread costs, liabilities and losses to or across the
       liabilities or assets of itself or members of the Lessor's
       Group, or any class of such liabilities or assets, and on such
       basis, as it considers appropriate.  A certificate under hand
       of an officer of the Lessor specifying the amount of such
       compensation shall in the absence of manifest error be
       conclusive.  Nothing contained in this Clause shall oblige the
       Lessor to disclose any information relating to the way in
       which it and members of the Lessor's Group employ their
       capital or arrange their internal financial affairs.

25.    GENERAL INDEMNITY

25.1   GENERAL INDEMNITY

       (a) The Lessee hereby agrees at all times to pay promptly or, as
       the case may be, indemnify and hold the Lessor and each member
       of the Lessor's Group and their respective officers,
       directors, secondees, agents and employees (together the
       "INDEMNIFIED PERSONS") harmless on a full indemnity basis from
       and against each and every liability, loss, charge, claim,
       demand, action, proceeding, damage, judgment, order or other
       sanction, enforcement, penalty, fine, fee, commission,
       interest, Lien, salvage, general average cost and expense of
       whatsoever nature suffered or incurred by or imposed on any
       Indemnified Person (together "LOSSES"):

                   (i) arising directly or indirectly out of or in any way
              connected with the purchase, manufacture, ownership,
              possession, performance, transportation, management,
              sale, import to or export from any jurisdiction,
              control, use or operation, registration, navigation,
              certification, classification, management, manning,
              provisioning, the provision of bunkers and lubricating
              oils, testing, design, condition, delivery to or by the
              Lessor, acceptance, leasing, sub-leasing, insurance,
              maintenance, repair, service, modification,
              refurbishment, drydocking, survey (save for survey
              costs expressly stated in this Agreement to be payable
              by the Lessor), conversion, overhaul, replacement,
              removal, repossession, return, redelivery, sale or
              disposal by the Lessee or any other person of the
              Vessel, whether or not such Liability may be
              attributable to any defect in the Vessel or to the
              design, construction or use thereof or from any
              maintenance, service, repair, drydocking, overhaul,
              inspection or to any other reason whatsoever (whether
              similar to any of the foregoing or not), and regardless
              of when the same shall arise (whether prior to, during
              or after termination of the leasing of the Vessel under
              this Agreement) and whether or not the Vessel (or any
              part thereof) is in the possession or control of the
              Lessee or the Sub-Lessee or a Service Contractor or any
              other person and whether or not the same is in the
              United Kingdom waters or abroad;

                   (ii) as a consequence of any claim that any design, 
              article or material in the Vessel or any part thereof or
              relating thereto or the operation or use thereof
              constitutes an infringement of patent, copyright,
              design or other proprietary right; 

                   (iii) in preventing or attempting to prevent the arrest,
              seizure, taking in execution, requisition, impounding,
              forfeiture or detention of the Vessel or in securing or
              attempting to secure the release of the Vessel in each
              case following the breach by the Lessee of its
              obligations under Clause 12.17 (unless the Lessor was
              required to take such action either under any
              applicable law or in order to avoid paying any penalty
              or fine);
                    
                   (iv) as a consequence (direct or indirect) of the breach
              by any person (other than the Lessor) of any of their
              respective obligations under any of the Lease Documents
              or of any of the warranties and representations on the
              part of any person (other than the Lessor) made in this
              Agreement or in any of the other Lease Documents being
              untrue or inaccurate in any respect whatsoever (even if
              not a Termination Event or a Relevant Event) when made;

                   (v) any costs and expenses reasonably incurred by the
              Lessor or, following the occurrence of a Termination
              Event, any costs and expenses incurred by the Lessor,
              in each case in connection with the sale or Total Loss
              of the Vessel (including, without limitation, broker's
              commissions, redelivery costs (if any), marketing
              expenses, legal costs, storage, insurance, registration
              fees and any other expenses of the Lessor incurred
              pending the sale or disposal of the Vessel or otherwise
              in connection with the sale or disposal of the Vessel);

                   (vi) any costs, expenses, damages, liabilities, penalties,
              fees and other outgoing expended, incurred or suffered
              by the relevant Indemnified Person in connection with:

                          (A) the arrest, seizure, taking into custody or
                     other detention by any court or other tribunal
                     or by any Government Entity (other than by
                     reason of a Lessor's Lien); or

                          (B) the subjection to distress by reason of any
                     process, claim, the exercise of any rights
                     conferred by a Lien (other than Lessor's Liens)
                     or by any other action whatsoever,

                          of any vessel owned or hired or leased by any 
              member of the Lessor's Group or which any member of the Lessor's
              Group has agreed to purchase pursuant to a conditional
              sale agreement, which are expended, suffered or
              incurred as a result of or in connection with any claim
              or alleged claim against, or liability or alleged
              liability of, any member of the Guarantor's Group
              together with any costs and expenses or other outgoings
              which may be paid or incurred by any member of the
              Lessor's Group in releasing such vessel from any such
              arrest, seizure, custody, detention or distress, which
              shall be deemed to include, in the event that such
              release is secured by the provision by any member of
              the Lessor's Group of any guarantee or bond or other
              security (including a cash deposit):

                          (1) any fee paid to any third party for the issue
                     of any such guarantee or bond; or

                          (2) if such guarantee or bond is issued by a member
                     of the Lessor's Group, an amount equal to the
                     fee which the Lessor certifies would have been
                     charged by such member of the Lessor's Group to
                     the Lessee had the Lessee requested the issue
                     in favour of a third party of a guarantee or
                     bond in an equivalent maximum principal amount
                     of the same currency; or

                          (3) in the case of a cash deposit, interest on the
                     amount of such deposit (less any interest
                     actually received by the Lessor thereon, but
                     after adding back the amount of any Tax
                     Liability in respect of such interest) for the
                     period from (and including the date on which
                     such deposit is provided to (but excluding) the
                     earlier of (a) the date upon which the Lessee
                     either pays to the Lessor or, as the Lessor may
                     require, ensures that there is credited to an
                     account with the Deposit Bank and charged in
                     favour of the Lessor upon terms acceptable to
                     the Lessor an amount equal to such deposit in
                     substitution or security therefor and (b) the
                     date of the release of such deposit at the rate
                     per annum which is the aggregate of the cost to
                     the Lessor or the applicable Relevant Member of
                     funding such deposit in the relevant currency
                     plus two per cent (2%); or

                          (4) in the case of any other security, the cost to
                     the Lessor or the applicable Relevant Member in
                     providing such security;

                     (vii) if the Vessel becomes a wreck or obstruction to
              navigation, against all losses, costs, damages and
              expenses which such Indemnified Person may in
              consequence thereof incur, including in respect of the
              removal or destruction of the wreck or obstruction
              under statutory or other powers,

              other than a Tax Liability or any amount in respect of which
       the Indemnified Person is entitled to be indemnified pursuant
       to Clause 26.1 (General Tax indemnity) or would, but for an
       exception contained in Clause 26.2 (Restriction on General Tax
       indemnity), be so indemnified (each of the above other than a
       Tax Liability being referred to as a "LIABILITY").

       (b) Without prejudice to the generality of the provisions of
       Clause 25.1(a), Clause 25.1 (a) shall extend to claims of
       persons (including governments or other bodies whether
       corporate or otherwise) who have incurred expenditure in
       taking preventative measures against loss or damage or have
       suffered or allege that they have suffered loss, damage or
       injury in connection with anything done or omitted to be done
       by any person in relation to, in respect of, or in connection
       with, the Vessel, including in connection with any oil or
       other substance emanating or threatening to emanate from the
       Vessel and shall extend to levies, impositions, calls or
       contributions on, or required to be made by, the Lessor during
       or in respect of the period commencing on the Delivery Date
       and terminating on a sale of the Vessel following the
       termination or expiration of the leasing of the Vessel
       hereunder.

(c)    The indemnities contained in Clause 25.1(a) shall extend to
       include:

                   (i) the Sterling cost (including fees and commissions) to
              the Indemnified Person in acquiring any currency (other
              than Sterling) with Sterling in order to satisfy or
              discharge in a currency other than Sterling any
              Liability;

                   (ii) all costs of interest, fees and other amounts
              whatsoever suffered or incurred by any Indemnified
              Person in order to fund the satisfaction or discharge
              of any Liability; and

                   (iii)  each Loss suffered or incurred by the Lessor in
              satisfying or discharging, or indemnifying any
              Indemnified Person (other than itself) against, any
              Liability, or any matter referred to in (i) or (ii)
              above, whether or not such Liability is suffered or
              incurred by the Lessor under any formal or informal
              arrangement, and whether or not any such formal or
              informal arrangement existed at the time the Liability
              was suffered or incurred by such Indemnified Person.

25.2   EXCLUSIONS FROM GENERAL INDEMNITY

              The indemnities contained in Clauses 25.1(a) and 25.1(b) shall
       not extend to any Liability:

                   (a) to the extent that such Liability is caused by any act
              of an Indemnified Person which constitutes the wilful
              misconduct of or recklessness by such Indemnified
              Person;

                   (b) to the extent that such Liability is caused by any
              failure on the part of the Lessor to comply with any of
              its express and specific obligations under any of the
              Relevant Lease Documents to which the Lessor is party;

                   (c) to the extent that such Liability constitutes the
              Lessor's Cost or any part thereof;

                   (d) to the extent that such Liability constitutes a cost
              which is expressly to be borne by the Lessor under any
              other provision of this Agreement, the Shipbuilding
              Contract or the Construction Supervision Agreement and
              which the Lessee establishes was not intended to be
              within the scope of the indemnities granted in favour
              of the Lessor or any other member of the Lessor's Group
              in any Relevant Lease Document;

                   (e) in respect of which the Lessor is expressly and
              specifically indemnified under any other provision of
              this Agreement; and

                   (f) any Liability which is caused solely by a failure of
              any Provider of Security (other than any Additional
              Security Provider who is a member of the Guarantor's
              Group) to comply with any obligation on its part under
              any Relevant Lease Document to which it is party.

25.3   NOTIFICATION OF INDEMNITY CLAIMS

            Without prejudice to the provisions of this Clause 25 and
       without limiting in any way whatsoever, or being a condition
       precedent or subsequent to, the indemnities in favour of any
       Indemnified Person hereunder or prompt payment thereunder, the
       Lessor shall:

                   (a) notify the Lessee in writing as soon as practicable
              after receipt by the Lessor of notice of a Liability
              (provided such notice is in writing).  Such
              notification to the Lessee from the Lessor shall give
              such details as the Lessor then has and which are in
              all the circumstances reasonable having regard to the
              contents of the notice of a Liability received by the
              Lessor; and

                   (b) where reasonably practicable notify the Lessee of 
              the Lessor's intention to pay or procure the payment of any
              moneys in respect of any such Liability before any such
              payment is made, provided that interest on any moneys
              payable to the Lessor or any Indemnified Person under
              Clause 25.1 in respect of such Liability shall only
              accrue at LIBOR (or, in relation to any currency other
              than Sterling, the Lessor's funding cost in that other
              currency) from the date on which the Lessor or that
              Indemnified Person incurs that Liability, until such
              time as the Lessor notifies the Lessee of that
              Liability, whereafter interest will accrue at the
              Default Rate until reimbursed in full under Clause
              25.1.

25.4   DEFENCE OF CLAIMS

              Without prejudice to the provisions of this Clause 25, the
       Lessee shall (subject to having first obtained the consent of
       the relevant insurers, if any, and complying in all respects
       with its obligations under this Agreement) be entitled to take
       (at its own cost) such actions as the Lessee reasonably deems
       fit to defend or avoid any liability arising in respect of a
       Liability or to take such action against any third party in
       respect of a Liability and shall be entitled if so agreed by
       the Lessor (which agreement the Lessor shall be at full
       liberty to withhold) in writing to take such action in the
       name of the Lessor, but subject always to the Lessor first
       being indemnified to its satisfaction by the Lessee against
       all potential losses, costs, damages and expenses.

25.5   RECOVERIES FROM THIRD PARTIES

              If any Indemnified Person shall recover from or be paid by,
       any person (other than the Lessee, the Sub-Lessee, a Service
       Contractor or out of any security constituted by any of the
       Relevant Lease Documents) any amount (other than under Clause
       26) in respect of any payments paid or discharged by the
       Lessee in accordance with this Clause 25, then provided that
       the Lessor has received payment of such amount and is
       satisfied that such amount is unconditionally available for
       retention by the Lessor, the Lessor shall pay to the Lessee a
       sum equal to the value of such recovered or paid amount
       together with any interest actually earned on such recovered
       or paid amount (less the amount of any Tax Liability thereon),
       such payment by the Lessor to be subject always to the
       provisions of Clause 26. 

25.6   OTHER INDEMNITIES

              Each of the indemnities contained in this Clause 25 or
       otherwise contained in this Agreement or in any other of the
       Lease Documents is in addition to, and not in substitution
       for, and shall not be affected or prejudiced by, any other
       security, guarantee or indemnity (including the other
       indemnities aforesaid) now or hereafter held by the Lessor.

25.7   PASS THROUGH OF INDEMNITY BENEFITS

              Where in this Clause 25 or in Clause 26 below an indemnity is
       expressed to be for the benefit of any person who is not a
       party to this Agreement the Lessor shall be entitled to
       indemnify such person on the same terms (and subject in
       particular to Clause 25.4) mutatis mutandis as the indemnities
       expressed to be for the benefit of such person in this Clause
       25 and the Lessee shall indemnify the Lessor and hold the
       Lessor harmless on a full indemnity basis from and against
       each amount paid or payable by the Lessor to such person under
       any such indemnity.

25.8   WAIVER OF RIGHTS

              The Lessee further agrees and does hereby agree, without
       prejudice to the express provisions of this Agreement, to
       waive any rights as against the Lessor that the Lessee may
       have under the 1976 Convention on the Limitation of Liability
       for Maritime Claims (as most recently enacted in the United
       Kingdom pursuant to the Merchant Shipping Act 1995) to limit
       or reduce any amount that the Lessee is or may be obliged to
       pay.

25.9   MITIGATION

              If circumstances arise in respect of the Lessor which would,
       or would upon the giving of notice, result in the Lessee being
       obliged to pay to the Lessor additional amounts pursuant to
       Clause 26.3(b) (Payments and Taxes), then, without in any way
       limiting, reducing or otherwise qualifying the obligations of
       the Lessee under Clause 26.3(b), the Lessor agrees that it
       will, for a period not exceeding thirty (30) days consult with
       the Lessee in good faith with the intention of determining
       whether it is possible to mitigate the effects of such
       circumstances, provided that any costs incurred by the Lessor
       in connection with such consultation or mitigation shall be
       reimbursed on demand by the Lessee and further that the Lessor
       shall be under no obligation to take any action and in
       particular, without limiting the generality of the foregoing
       words, the Lessor shall be under no obligation to take any
       action which might have an adverse effect upon its business,
       operations or financial condition or the management of its Tax
       affairs.

26.    GENERAL TAX INDEMNITY AND OTHER TAX PROVISIONS

26.1   GENERAL TAX INDEMNITY AND PAYMENT OF CERTAIN OUTGOINGS

              the Lessee shall pay and discharge or cause to be paid and
       discharged, as soon as the same arise or become payable (and
       shall, if requested by the Lessor, produce to the Lessor
       evidence of the payment and discharge thereof) and indemnify
       the Lessor and other members of the Lessor's Group and keep
       the Lessor and other members of the Lessor's Group fully
       indemnified against:

                   (a) any Tax Liabilities; and

                   (b) any licence duties, registration, recording, titling 
              or filing fees, charges or levies and any interest or
              penalties payable in connection with any of the same;

              which arise or become payable at any time in respect of, in
       consequence of or by reference to:

                   (i) the Vessel (or any part thereof) or any interest
              therein; or 

                   (ii) any document, payment, matter, circumstance or
              transaction entered into, made or occurring pursuant
              to, contemplated by or in accordance with this
              Agreement or by any of the other Lease Documents
              including (without limitation) the agreement to
              purchase, ownership, delivery to or by the Lessor,
              leasing, use, possession, operation, import, export,
              return, storage, maintenance, protection, sale,
              attempted sale or other disposition of the Vessel (or
              any part thereof) or any interest therein;

              or which arise or become payable as a result (whether alone or
       in connection with any other matter or circumstance) of
       anything done in response to any request by the Lessee or any
       other member of the Guarantor's Group.

26.2   RESTRICTION ON GENERAL TAX INDEMNITY

              The Lessee shall not be obliged to indemnify the Lessor or as
       the case may be the applicable Relevant Member pursuant to
       Clause 26.1:

                   (a) against Corporation Tax attributable to any Rent or
              Termination Payment or interest actually receivable
              hereunder by the Lessor or to any other amounts payable
              to and unconditionally received by the Lessor under
              this Agreement or pursuant to or in connection with any
              of the other Relevant Lease Documents or to any sales
              or other proceeds (including, without limitation,
              insurance moneys) actually received and retained by the
              Lessor in respect of the Vessel; 

                   (b) against any Tax Liability or liability in respect of
              any of the matters referred to in Clause 26.1(b) to the
              extent it would not have arisen but for the reasonably
              avoidable delay or failure by the Lessor or, as the
              case may be, the applicable Relevant Member in the
              filing of Tax returns or the payment of Taxes or any
              duties, fees, charges or levies referred to in Clause
              26.1(b) assessed on or payable by the Lessor or, as the
              case may be, the applicable Relevant Member which delay
              or failure has not been consented to, or requested by
              the Lessee or any other member of the Lessee's Group or
              unless such failure or delay by the Lessor or, as the
              case may be, the applicable Relevant Member arises from
              a failure by the Lessee or any other member of the
              Lessee's Group promptly to provide the Lessor or, as
              the case may be, the applicable Relevant Member with
              correct, suitable and adequate information to enable
              the Lessor or, as the case may be, the applicable
              Relevant Member to file the relevant Tax return or pay
              such Taxes or other amounts;

                   (c) against any Tax Liability to the extent that it is
              taken into account in accordance with the provisions of
              the Financial Schedule in computing the amount of any
              Rent or Termination Payment or any adjustment thereto
              or would be so taken into account but for the operation
              of paragraph 3.3 of Part 3 of the Financial Schedule; 

                   (d) against any Tax Liability which is imposed by way of
              deduction or withholding from any payment due from the
              Lessee under this Agreement to the Lessor, whether or
              not the Lessee is required to make any payment or
              increased payment in respect thereof under Clause 26.3;

                   (e) against any Tax Liability which is suffered by the
              Lessor by reason of the non-deductibility for the
              purposes of Taxation of any payment made by the Lessor
              to the Lessee, whether or not the Lessor is entitled to
              make any withholding in respect thereof under Clause
              26.7;

                   (f) to the extent that such Tax Liability is caused by 
              any act of the Lessor which constitutes wilful misconduct
              of or recklessness by the Lessor or a breach by the
              Lessor of its obligations under the Relevant Lease
              Documents; 

                   (g) against any Tax Liability in respect of VAT or
              Irrecoverable VAT, whether or not the Lessee is
              required to make any payment or increased payment in
              respect thereof under Clause 26.4.

26.3   PAYMENTS AND TAXES

       (a) All the sums payable to the Lessor and/or any member of the
       Lessor's Group pursuant to or in connection with this
       Agreement or any of the other Relevant Lease Documents 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 and/or any member of the
       Lessor's Group pursuant to or in connection with this
       Agreement or any of the other Relevant Lease Documents or any
       document contemplated by or entered into pursuant hereto or
       thereto (including any Service Contract), the Lessee 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) (A) if the payment is to be made by the Lessee,
                     increase the payment in respect of which the deduction or
                     withholding is required so that the net amount received by
                     the Lessor or, as the case may be, the applicable Relevant
                     Member as aforesaid 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 or, as the case may be, that Member
                     would have been entitled to receive in the absence of any
                     requirement to make a deduction or withholding; or (as the
                     case may be)

                          (B) if the payment is to be made by any person
                     other than the Lessee, pay directly to the
                     Lessor or, as the case may be, that Member such
                     sum (a "COMPENSATING SUM") as will, after
                     taking into account any deduction or
                     withholding which is required to be made in
                     respect of the compensating sum, enable the
                     Lessor or, as the case may be, that Member to
                     receive, on the due date for payment, a net sum
                     equal to the sum which the Lessor or, as the
                     case may be, that Member would have received in
                     the absence of any obligation to make a
                     deduction or withholding; and

                     (iv) promptly deliver or procure the delivery to the 
              Lessor or, as the case may be, that Member of appropriate
              receipts evidencing the deduction or withholding which
              has been made.

       (c) If the Lessor or, as the case may be, the applicable Relevant
       Member 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
       Lessee has made an increased payment or paid a compensating
       sum under this Clause 26.3 the Lessor or, as the case may be,
       that Member shall, provided the Lessor or, as the case may be,
       that Member has received all amounts which are then due and
       payable under any of the provisions of this Agreement and the
       other Relevant Lease Documents, pay to the Lessee (to the
       extent that the Lessor or, as the case may be, that Member can
       do so without prejudicing, the amount of that benefit and the
       right of the Lessor or, as the case may be, that Member 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 or, as the case may be, that
       Member in no better and no worse position than the Lessor or,
       as the case may be, that Member would have been in if the
       deduction or withholding had not been required,

              PROVIDED THAT:
              
                   (i) the Lessor or, as the case may be, that Member 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 or, as the case may be, that Member shall
              not be obliged to disclose any information regarding
              its business, Tax affairs or Tax computations;

                   (iii) if the Lessor or, as the case may be, that Member 
              has made a payment to the Lessee pursuant to Clause 26.3(c)
              on account of any Tax benefit and it subsequently
              transpires that the Lessor or, as the case may be, that
              Member did not receive that Tax benefit, or received a
              lesser Tax benefit, the Lessee 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 or, as the case may be, that Member to that
              which it would have been had no adjustment under this
              proviso (iii) been necessary.  Any sums payable by the
              Lessee to the Lessor under this proviso (iii) shall be
              subject to the provisions of Clause 26.5;

                   (iv) the Lessor or, as the case may be, that Member shall
              not be obliged to make any payment under this Clause
              26.3 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 but compliance
              with which is customary); and

       (c) PROVIDED FURTHER THAT if the Lessee 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 Lessee) take such action
       as the Lessee 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 Lessee has made an increased payment
       or paid a compensating sum under this Clause 26.3 the Lessor
       shall, provided that the Lessor has received all amounts which
       are then due and payable by the Lessee under any of the
       provision of this Agreement and the other Relevant Lease
       Documents, pay to the Lessee 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.

26.4   VALUE ADDED TAX

       (a) If the Lessor makes any supply for Value Added Tax purposes
       pursuant to or in connection with this Agreement or any of the
       other Relevant Lease Documents or any transaction or document
       contemplated herein or therein, the Lessee 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 26.4(b) below) at such time as the Lessor certifies to
       the Lessee 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 Agreement and the other Relevant Lease
       Documents 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 or Value Added Tax paid by the Lessor pursuant
       to this Agreement or any of the Relevant Lease Documents shall
       be Irrecoverable VAT, the Lessee 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 Lessee 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 Lessee to the Lessor under
       this Clause 26.4(c).

26.5   GROSSING-UP OF INDEMNITY PAYMENT

            If the Lessor makes a payment or suffers a loss in respect of
       which it is entitled to be indemnified or reimbursed or
       otherwise kept harmless pursuant to any provision of this
       Agreement or any of the other Lease Documents and the Lessor
       determines in its absolute discretion that:

                            (a) (i) the loss or payment is not or will 
                     not be wholly deductible in computing the profits of
                     the Lessor for the purposes of Tax whilst the
                     payment to be made by way of indemnity or
                     reimbursement (for the purpose of this Clause
                     26.5, the "PAYMENT") will or is likely to give
                     rise to a Tax Liability for the Lessor; or

                                (ii) the Payment is likely to give rise to 
                     a Tax Liability for the Lessor in any Accounting
                     Period of the Lessor earlier than the
                     Accounting Period in which the loss or payment
                     is deductible;

                            then, at the time of the Payment the Lessee shall
              pay such an amount (the "ADDITIONAL PAYMENT") as will,
              after taking into account any Tax Liability likely to
              be suffered or incurred by the Lessor in respect of the
              Payment or the Additional Payment, leave the Lessor in
              the same after-Tax position as it would have been in
              had the Payment not given rise to any Tax Liability and
              the loss or payment had not been deductible PROVIDED
              THAT if at the time of the Payment the Lessor considers
              that no Additional Payment is necessary but
              subsequently determines that an Additional Payment is
              necessary so to indemnify the Lessor, the Additional
              Payment shall be paid by the Lessee to the Lessor
              following a demand by the Lessor;

                            (b) the loss or payment has proved to be 
              wholly deductible in computing the profits of the Lessor for 
              the purposes of Tax whilst the Payment by the Lessee has 
              provided not to give rise to any Tax Liability for the Lessor,
              then the Lessor shall pay to the Lessee a rebate of
              Rent (for the purposes of this Clause 26.5 the
              "REBATE") of such amount as will leave the Lessor in no
              better and no worse position than it would have been in
              if the Payment had not given rise to a Tax Liability
              for the Lessor and the loss or payment had not been
              deductible,

              PROVIDED THAT if the Lessor subsequently determines that any
       payment by the Lessee to the Lessor under this Clause 26.5 by
       way of an Additional Payment or, as the case may be, any
       Rebate was calculated on an incorrect basis, such adjustment
       shall be made between the Lessor and Lessee as the Lessor
       determines necessary to restore the after-Tax position of the
       Lessor to that which it would have been if no adjustment had
       been necessary.

26.6   DOCUMENTARY AND OTHER SIMILAR TAXES

              All stamp, documentary, registration or other like duties or
       Taxes, including any penalties, additions, fines, surcharges
       or interest relating thereto, which are imposed on or
       chargeable on or in connection with this Agreement or any of
       the other Relevant Lease Documents or the Sub-Lease or any
       Service Contract shall be paid by the Lessee PROVIDED THAT the
       Lessor shall be entitled but not obliged to pay any such
       duties or Taxes, whether or not they are its primary
       responsibility, whereupon the Lessee shall on demand indemnify
       the Lessor against those duties or Taxes.  The Lessor agrees
       that if it decides to pay any such duties or Taxes, it shall
       give the Lessee not less than five (5) Business Days' notice
       before making such payment.

26.7   DEDUCTIBILITY

              Notwithstanding anything contained in this Agreement or any
       of the other Relevant Lease Documents (other than in relation to
       any rebate of Rent under Clause 10.2(b) or 20.2(ii)), if the
       Lessor determines that any payment which it is required to
       make to the Lessee under this Agreement or under any of the
       other Relevant Lease Documents, by way of rebate of Rent or
       otherwise, will not or may not be fully deductible in
       computing the Lessor's liability to Corporation Tax for the
       Accounting Period of the Lessor in which the payment is made,
       the Lessor shall, except to the extent that such
       non-deductibility has been taken into account in accordance
       with the Financial Schedule as a result of Assumption 2.3.13
       (d) (iii) proving not to be correct, be entitled to withhold
       and retain from that payment such amount as the Lessor
       determines to be necessary to enable it to occupy the same
       after-Tax position as it would occupy if the payment were
       fully deductible as aforesaid;

              PROVIDED THAT if:

                   (a) any such payment is made without withholding and the
              Lessor subsequently determines that the payment will
              not or may not be fully deductible as aforesaid; or

                   (b) any such payment is made subject to withholding and 
              the Lessor subsequently determines that no such withholding
              ought to have been made or the basis on which the
              withholding was calculated was incorrect;

              such adjustment shall be made between the Lessor and the
       Lessee as the Lessor determines to be necessary, taking into
       account the time value of money, to enable the Lessor to
       occupy the same after-Tax position as it would occupy if no
       such adjustment were necessary.  Any sum payable by the Lessee
       to the Lessor under this proviso shall be subject to the
       provisions of Clause 26.5.

27.    PRESERVATION OF INDEMNITIES

              Without prejudice to damages or other claim which either party
       may, at any time, have against the other hereunder or under
       any of the Relevant Lease Documents it is hereby agreed and
       declared that the indemnities given by the Lessee in favour of
       the Lessor or any member of the Lessor's Group contained in
       this Agreement shall continue in full force and effect
       notwithstanding any sale or other disposition of the Vessel, a
       Total Loss having occurred or any breach of the terms hereof
       or thereof by the Lessor (including fundamental breach), the
       repudiation by the Lessor or the Lessee of this Agreement or
       any of the Relevant Lease Documents or the expiration of the
       Pre-Lease Period or the Lease Period through effluxion of time
       or otherwise or the termination of the leasing or sale of the
       Vessel hereunder or any other circumstance whatsoever.

28.    ASSIGNMENT

28.1   ASSIGNMENT BY LESSOR

              The Lessee acknowledges and agrees that the Lessor shall be
       entitled at any time and from time to time to assign,
       transfer, novate or otherwise dispose of all (but not part
       only) of its interest in the Vessel and the Relevant Lease
       Documents:

                     (a) to any person (the "TRANSFEREE") who is not a member 
              of the Lessor's Group with the prior written consent of
              the Lessee (such consent not to be unreasonably
              withheld) provided always that without prejudice to the
              foregoing:

                          (i) the assignment, transfer, novation or other
                     disposal shall be on terms that the Lessee
                     shall be under no greater obligation or
                     liability under this Agreement and the other
                     Relevant Lease Documents to which it is a party
                     than it would have been under but for such
                     assignment, transfer, novation or other
                     disposal;

                          (ii) the Transferee (or its ultimate parent 
                     company) is a bank or financial institution having a
                     credit rating equal to or better than that of
                     the Bank as at the date of the assignment,
                     transfer, novation or other disposal;

                          (iii) the rights of the Lessee under the Relevant
                     Lease Documents shall not be adversely affected
                     and shall be on equivalent terms to the
                     Relevant Lease Documents in force prior to the
                     assignment, transfer, novation or other
                     disposal (and, without prejudice to the
                     generality of the foregoing, if the Transferee
                     itself is not a bank or financial institution
                     satisfying the requirements of paragraph (ii)
                     above, the Lessee shall receive a parent
                     company guarantee from the ultimate holding
                     company of the Transferee on terms no less
                     favourable than that granted by the Bank); and

                          (iv) it shall, without limitation, be reasonable 
                     for the Lessee to withhold its consent if it
                     certifies that the proposed Transferee (or its
                     ultimate parent company or a subsidiary of its
                     ultimate parent company) is a company with
                     which the Lessee or any other company or the
                     Guarantor's Group has valid business reasons
                     for not entering into a relationship; and

                     (b) to any person who is a member of the Lessor's Group
              without the need for the Lessee's consent provided that
              the Lessee shall not be required to suffer or incur any
              greater cost in the performance of its obligations
              under this Agreement or the other Relevant Lease
              Documents to which it is a party, or any loss of
              benefit, than would have been the case but for such
              assignment, transfer, novation or other disposal,

              and in each case, and the Lessee hereby agrees and undertakes
       that it will upon the request of the Lessor execute such
       further documents and give such notices as the Lessor may
       reasonably require in order to effect such assignment,
       transfer, novation or other disposal, provided that any costs
       incurred by the Lessee (including any legal fees and
       Irrecoverable VAT thereon) in connection therewith or with any
       consequential amendments to the Lease Documents shall be
       reimbursed by the Lessor upon presentation of a copy of the
       relevant invoice.

28.2   ASSIGNMENT BY THE LESSEE

                   (A) Except as expressly permitted by Clauses 28.2(B) 
              and 28.2(D), the Lessee may not assign, transfer or part
              with any of its rights or obligations under, or the
              benefit or burden of, this Agreement or the other Lease
              Documents to which the Lessee is a party without the
              prior written consent of the Lessor.

                   (B) The Lessee shall be entitled at any time and from 
              time to time to assign and transfer the entire burden and
              benefit of this Agreement and the other Lease Documents
              to which it is a party to any person who is a member of
              the Guarantor's Group without the need for the Lessor's
              consent provided that:

                          (i) the transferee and any other necessary person
                     shall enter into such documentation as may be
                     necessary to give effect to such assignment and
                     transfer (including any amendment that may be
                     necessary to the terms of the Guarantee to
                     ensure that the Guarantee extends to the
                     obligations of the assignee hereunder);

                          (ii) the Lessor shall not suffer or incur any
                     greater cost, or any loss of benefit, or any
                     increased obligation, liability or risk than
                     would have been the case but for such
                     assignment and transfer; and

                          (iii)  any costs and expenses (including stamp 
                     duty) in respect of such assignment and transfer
                     shall be for the Lessee's account.

                     (C) The Lessor agrees from time to time, and at the
              Lessee's expense, to co-operate with the Lessee and do
              and perform such acts and execute and deliver such
              instruments as the Lessee may reasonably request to
              effect such assignment and transfer referred to in
              Clause 28.2(B).

                     (D) The Lessee shall be entitled to and will, on request 
              of the Lessor or any financier who advances funds to the
              Sub-Lessee to enable it to pay the put option price
              under Clause 3 of the Put Option Deed, assign its
              rights to receive rebate of Rent under Clause 20.2(ii)
              to any such financier on such terms as such financier
              may reasonably require and do such further acts and
              enter into such further documents in order to enable
              such funding to take place.

29.    LESSOR'S RIGHT OF SET-OFF

                     (A) The Lessor shall be entitled to set off or withhold
              from any sum or sums expressed in this Agreement or any
              of the Relevant Lease Documents to be payable by the
              Lessor to the Lessee (other than any sum or sums
              referred to in Clause 29(B)) any amounts due or
              expressed to be due (or would, if demanded, be due)
              from the Lessee, to the Lessor under this Agreement or
              any of the Relevant Lease Documents, other than amounts
              payable in relation to Excluded Obligations.  Save as
              aforesaid, the Lessee authorises the Lessor to apply
              any credit balance to which the Lessee is entitled on
              any account of the Lessee with the Lessor in
              satisfaction of any sum due and payable from the Lessor
              hereunder or under any of the other Relevant Lease
              Documents but unpaid; for this purpose, the Lessor is
              authorised to purchase with the moneys standing to the
              credit of any such account such other currencies as may
              be necessary to effect such application.  The Lessor
              shall not be obliged to exercise any right given to it
              by this Clause 29.

                     (B) Rebates of Rent expressed to be payable by the 
              Lessor to the Lessee under Clause 10.2(b) or 20.2(ii) shall be
              paid by the Lessor without set-off or counterclaim and
              are hereby expressly excluded from the Lessor's rights
              under Clause 29(A).

30.    SUB-LEASING

                     (A) The Lessee shall not, without the prior written 
              consent of the Lessor, sub-lease the Vessel (and shall procure
              that there is no further sub-leasing of the Vessel by
              any Sub-Lessee) other than to the Sub-Lessee under a
              charter by way of demise, time charter, voyage charter
              or other chartering arrangement upon terms to be agreed
              by the Lessee and the Sub-Lessee PROVIDED THAT any such
              charter or other chartering arrangement shall always
              contain a term that neither the Vessel nor any part
              thereof shall be used during the requisite period (as
              defined in Section 40 CAA 1990) so as to result in the
              application of any of Sections 42, 43, 44 and 46 CAA
              1990.

                     (B) In the event that the Sub-Lessee performs any act 
              to be performed by the Lessee hereunder which, if it had been
              performed by the Lessee, it would fully satisfy an
              obligation of the Lessee to the Lessor hereunder, such
              obligation of the Lessee shall be deemed satisfied as
              between the Lessor and the Lessee to the extent so
              performed by the Sub-Lessee.

                     (C) The Lessee shall procure that the Sub-Lease is in all
              respects subordinate to the rights of the Lessor under
              this Agreement and shall automatically terminate upon
              the service of a Termination Notice hereunder.  The
              Lessee shall further procure that the Sub-Lease
              provides that, following the service of a Termination
              Notice but subject to Clause 21.7, the Sub-Lessee shall
              surrender possession and control of the Vessel to the
              Lessor and shall not exercise or purport to exercise
              any Lien which they, either together or individually,
              might have over or in respect of the Vessel in respect
              of the termination of their right to possession of the
              same.

31.    MISCELLANEOUS

31.1   GENERAL FEES AND EXPENSES

              The Lessee shall on demand:

                   (a) pay or reimburse to the Lessor all costs and 
              expenses (including, without limitation, the Lessor's Expenses
              and survey costs) of the Lessor properly incurred in
              connection with the negotiation, preparation or
              execution of the Lease Documents and any amendment,
              variation or waiver from time to time hereto or thereto
              or any consent from time to time hereunder or
              thereunder and in connection with the payment by the
              Lessor of each of the Instalments, the delivery to or
              by the Lessor, redelivery or sale of the Vessel or any
              part thereof, save to the extent that such costs and
              expenses have been taken into account in the Financial
              Schedule;

                    (b) pay or reimburse to the Lessor all costs and expenses
              (including, without limitation, legal fees and survey
              costs and expenses) properly incurred by the Lessor in
              connection with or incidental to the breach by any
              party (other than the Lessor and any Provider of
              Security other than any Additional Security Provider
              who is a member of the Guarantor's Group) of any of its
              respective obligations under the Lease Documents, the
              protection, preservation or enforcement of any right or
              remedy conferred upon the Lessor under any of the Lease
              Documents or by law, or to any action or act to recover
              possession of the Vessel or any part thereof, whether
              or not any such action progresses to judgment;

                    (c) pay or reimburse to the Lessor all costs and 
              expenses (including, without limitation, fees of legal and 
              other advisers) incurred in connection with any action or act
              brought by the Lessor to recover any Rent or other
              payments due from any party (other than the Lessor, the
              Bank and any Provider of Security other than any
              Additional Security Provider who is a member of the
              Guarantor's Group) under this Agreement or any of the
              other Lease Documents; and

                    (d) pay or reimburse to the Lessor all costs and 
              expenses (including without limitation, legal, insurance and
              other advisers) properly incurred by the Lessor in
              connection with a Total Loss of the Vessel.

31.2   INTENTIONALLY OMITTED

31.3   DELAY IN ENFORCEMENT, WAIVERS ETC.

              All waivers of any right, power or privilege by any of the
       Lessor or the Lessee shall be in writing signed by the Lessor
       or, as the case may be, the Lessee.  No failure or delay on
       the part of the Lessor or the Lessee 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.

31.4   VARIATION

              This Agreement shall only be varied by an instrument in
       writing executed by the parties hereto.

31.5   INVALIDITY

              If any term or provision of this Agreement or the application
       thereof to any person or circumstance shall to any extent be
       invalid or unenforceable the remainder of this Agreement or
       application of such term or provision to persons or
       circumstances other than those as to which it is already
       invalid or unenforceable shall not be affected thereby and
       each term and provision of this Agreement shall be valid and
       shall be enforceable to the fullest extent permitted by law.

31.6   NOTICES

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

              (i)    if to the Lessor to:
              
                            Nelstar Leasing Company Limited
                            Great Surrey House
                            203 Blackfriars Road
                            London  SE1 8NH
                            England

                            Fax:   +(44) 171 922 1874
                            Attention:    Managing Director

              (ii)   if to the Lessee to:

                            c/o McKinney, Bancroft & Hughes
                            Mareva House
                            4 George Street
                            P.O. Box 3937
                            Nassau
                            The Bahamas

                            Fax:   +(1) 242 328 2520
                            Attention:    Richard Lightbourn
                            with a copy sent to:

                            Global Marine Inc.
                            777 N. Eldridge Parkway
                            Houston
                            Texas 77079
                            USA

                            Fax:   +(1) 281 596 5196
                            Attention:    General Counsel

              or in each case to such other person or address or facsimile
       number as one party may, by not less that three (3) Business
       Days' notice, notify in writing to the other party hereto.

       (b) 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 and in the case of
       facsimile transmission, upon receipt by the sender of a
       transmission report showing the Notice has been sent in its
       entirety.  The sender of a Notice by facsimile shall despatch
       an original of such Notice in the first class airmail post
       with postage prepaid in an envelope addressed to the recipient
       of the facsimile at its address stated in Clause 31.6(a), but
       the facsimile Notice shall be the definitive Notice for the
       purposes of this Agreement.

31.7   APPLICABLE LAW

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

31.8   COUNTERPARTS

              This Agreement 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.

31.9   FURTHER ASSURANCES

              The Lessee agrees from time to time, and at the Lessee'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 Lessee to
       establish, maintain and protect the rights and remedies of the
       Lessor and to carry out and effect the intent and purpose of
       this Agreement and the other Relevant Lease Documents.

31.10  ENTIRE AGREEMENT

              This Agreement, in conjunction with the other Relevant Lease
       Documents and any other letter agreements of even date
       herewith or subsequent hereto between the Lessor and any other
       party to the Relevant Lease Documents, constitute the entire
       agreement between the parties hereto in relation to the
       leasing of the Vessel by the Lessor to the Lessee, and
       supersede all previous proposals, agreements and other written
       and oral communications in relation thereto.

31.11  SUBMISSION TO JURISDICTION

       (a) The Lessee (which shall include its successors and permitted
       assigns from time to time) hereby submits to the non-exclusive
       jurisdiction of the courts of England with regard to this
       Agreement and the other Relevant Lease Documents.  Any legal
       action or proceedings with respect to this Agreement and the
       other Relevant Lease Documents may be brought in the courts of
       England or such other jurisdiction, as the Lessor may elect. 
       By its execution and delivery of this Agreement, the Lessee:

                   (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 Agreement and the other Relevant Lease
              Documents;

                   (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 Agreement and the
              other Relevant Lease Documents;

                   (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 Agreement
              and the other Relevant Lease Documents 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; and

                   (iv) hereby consents generally in respect of any legal
              action or proceeding arising out of or in connection
              with this Agreement and the other Relevant Lease
              Documents to the giving of any relief or the issue of
              any process in connection with such action or
              proceeding including, without limitation, the making,
              enforcement or execution against any property
              whatsoever (irrespective of its use or intended use) of
              any order or judgment which may be made or given in
              such action or proceeding.

       (b) The Lessee in the case of the courts of England, hereby
       designates, appoints and empowers WFW Legal Services Limited
       (ref: CALP/DNO 2628.16002), at the address of its registered
       office for the time being (presently 15 Appold Street, London
       EC2A 2HB) to receive, for it and on behalf of it, service of
       process in any legal action or proceedings with respect to
       this Agreement or the other Relevant Lease Documents.  The
       Lessee agrees that it will at all times continuously maintain
       an agent to receive service of process in England on its
       behalf and on behalf of its property with respect to this
       Agreement and the other Relevant Lease Documents and if, for
       any reason, such agent named above or its successor shall no
       longer serve as agent of the Lessee to receive service of
       process in England, the Lessee shall promptly appoint a
       successor in England and advise the Lessor thereof.  It is
       understood that a copy of any process served as above will be
       promptly forwarded (if necessary) by first class prepaid air
       mail post to the Lessee but the failure of the Lessee to
       receive such copy shall not affect in any way the service of
       such process on the said person as the agent of the Lessee.

31.12  JUDGMENT CURRENCY

              If, under any applicable law, whether as a result of a
       judgment against any of the parties hereto or the liquidation
       of any of the parties hereto for any other reason, any payment
       under or in connection with this Agreement or any of the other
       Relevant Lease Documents or a Service Contract is made or is
       recovered in a currency (the "OTHER CURRENCY") other than that
       in which it is required to be paid hereunder or thereunder
       (the "ORIGINAL CURRENCY") then, to the extent 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 Agreement or any of the other Relevant Lease
       Documents or a Service Contract as aforesaid, the payer (or,
       in the case of a payment to the Lessor under a Service
       Contract, the Lessee) shall as a separate and independent
       obligation fully indemnify the payee on demand against the
       amount of the shortfall; and for the purposes of this Clause
       31.13 "RATE OF EXCHANGE" means the rate at which the payee is
       able as at 11.00 a.m. (London time) on the relevant date to
       purchase the Original Currency from the Bank in London with
       the Other Currency.

32.    CONFIDENTIALITY

              At all times during the Pre-Lease Period and the Lease Period,
       each of the parties hereto shall keep confidential and shall
       not, without the prior written consent, in the case of the
       Lessee, of the Lessor and, in the case of the Lessor, of the
       Lessee issue any press release in relation to the transactions
       evidenced by this Agreement and the other Lease Documents, or
       disclose to any other person the financial details of this
       Agreement or any other Lease Document and the transactions
       contemplated hereby or thereby or any other agreement entered
       into after the date hereof by the Lessor and the Lessee  in
       connection with this Agreement or any other Lease Document, or
       release copies or drafts of any such document which disclose
       or reveal the identity of the parties (or any of them)
       provided that (i) the Lessor will not unreasonably withhold or
       delay its consent to any proposed press release and (ii) the
       parties hereto shall be entitled, without any such consent, to
       disclose the same:

                   (a) in connection with any proceedings arising out of 
              or in connection with this Agreement or any of the other
              Lease Documents; or

                   (b) if required to do so by an order of a court of
              competent jurisdiction whether in pursuance of any
              procedure for discovery of documents or otherwise; or

                   (c) pursuant to any law or regulation having the force
              of law; or

                   (d) to any fiscal, monetary, tax, governmental or other
              competent authority; or

                   (e) to the auditors, legal or other professional advisers,
              insurance brokers or underwriters of any member of
              either the Guarantor's Group or the Lessor's Group; or

                   (f) if any of the same is or shall become publicly known
              otherwise than as a result of a breach by such party of
              this Clause 32; or

                   (g) in any manner contemplated by any of the Lease
              Documents; or

                   (h) to any other party to the Lease Documents or any
              Additional Security Provider to the extent that such
              Additional Security Provider has executed a
              confidentiality undertaking in favour of the Lessor in
              form and content reasonably acceptable to the Lessor.

AS WITNESS this Agreement is executed by each of the parties hereto
as their respective deeds and is intended to be and is hereby
delivered the day and year above written.


                                SCHEDULE 1
                                
                           Financial Schedule




                                SCHEDULE 2




                                SCHEDULE 3

                          INTENTIONALLY OMITTED


                                SCHEDULE 4

                                  Part 1

               REPRESENTATIONS AND WARRANTIES BY THE LESSEE


       (A) The Lessee is a company duly incorporated and validly existing
       under the laws of the Commonwealth of the Bahamas 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 the Lease Documents to
       which it is or is to be a party and to consummate the
       transactions contemplated hereby;

       (B) the execution, delivery and performance by the Lessee of the
       Lease Documents to which it is or is to be a party and the
       consummation of the transactions contemplated hereby have been
       duly authorised by all necessary or appropriate corporate
       action on the part of the Lessee, do not require any
       shareholder approval, or  approval or consent of any trustee
       or holders of any indebtedness or obligations of the Lessee
       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 Lessee or any of its
       assets, (bb) its Constitutive 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;

       (C) this Agreement and the other Lease Documents to which the
       Lessee is or is to be a party constitutes, or when executed
       and delivered will constitute, the legal, valid and binding
       obligations of the Lessee enforceable in accordance with its
       terms subject to general principles of equity and the law
       affecting creditors' rights generally;

       (D) 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 Lessee
       or the rights of the Lessor under this Agreement and the other
       Lease Documents to which the Lessee is or is to be a party;

       (E) no event has occurred which constitutes a default under, any
       agreement by which the Lessee, 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 Lessee or materially and adversely affect its ability to
       observe or perform its obligations under this Agreement and
       the other Relevant Lease Documents to which the Lessee is or
       is to be a party;

       (F) 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 Agreement and
       the other Lease Documents to which the Lessee is or is to be a
       party is presently in progress or, to the best of the
       knowledge, information and belief of the Lessee, pending or
       threatened against the Lessee, its business or any of its
       assets;

       (G) no Termination Event has occurred and is continuing and no
       Relevant Event has occurred and is continuing;

       (H) the Lessee 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 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;

       (I) under applicable laws of the Commonwealth of the Bahamas in
       force at the date hereof the Lessee is not required to deduct
       any Taxes from any payments that it may be required to make
       under this Agreement or any of the other Lease Documents to
       which the Lessee is or is to be a party;

       (J) the Lessee is conducting its business in all material respects
       in compliance with all applicable laws, regulations and
       government directives and the Lessee 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;

       (K) intentionally omitted; 

       (L) all information furnished by the Lessee to the Lessor relating
       to the transactions contemplated by the Lease Documents is
       true and accurate in all material respects and there are no
       omissions of material facts or misleading information
       contained in such information;

       (M) neither the Lessee 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;

       (N) the Lessee has complied 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 material claims are
       being asserted against it with respect to Taxes which would be
       likely either to have a material adverse effect on the
       business, assets, operations, prospects or condition
       (financial or otherwise) of the Lessee or materially and
       adversely affect its ability to observe and perform its
       obligations under this Agreement and the other Relevant Lease
       Documents to which the Lessee is or is to be a party;

       (O) no stamp or registration duty or similar taxes or charges are
       payable in the Commonwealth of the Bahamas in respect of this
       Agreement or any of the other Lease Documents; 

       (P) subject to any qualifications contained in the legal opinions
       addressed to the Lessor described in paragraph 5 of Part 1 of
       Schedule 5, the choice of English law to govern this Agreement
       and the other Relevant Lease Documents to which the Lessee is
       or is to be a party is a valid choice of law and English law
       will accordingly be applied by the courts in the Commonwealth
       of the Bahamas if this Agreement or such other Relevant Lease
       Documents or any claim hereunder or thereunder comes under
       their jurisdiction upon proof of the relevant provisions of
       English law.  The submission hereunder by the Lessee to the
       jurisdiction of the courts of England and the appointment by
       the Lessee of process agents in England to accept service of
       process in respect of the jurisdiction of such courts is valid
       and binding upon the Lessee;

       (Q) the Vessel on the Delivery Date will:

                   (i) be eligible in all respects for registration in the
              Flag State;

                   (ii) maintain the Classification free of all
              recommendations, reservations, notations and
              requirements of the Classification Society excepting
              those which do not have to be complied with prior to
              the Delivery Date and will be tight, staunch, strong
              and seaworthy and will have placed on board full
              classification and other certificates required under
              all applicable laws and the rules, regulations and
              requirements of the Classification Society including
              those to which the Vessel, her Master, officers and
              crew are subject at the Delivery Date; and

                   (iii) be free from Liens (other than Permitted Liens);

       (R) the Lessee is in compliance with and has at all times complied
       with all applicable Environmental Laws and Environmental
       Permits required in connection with the Vessel;

       (S) the Lessee will at Delivery comply with all applicable
       requirements for operators of vessels of a similar type as the
       Vessel of the United States Oil Pollution Act of 1990, as
       amended, the regulations promulgated and guidance having the
       force of law issued pursuant thereto; and

       (T) the Guarantor is a person "connected" (construed in accordance
       with section 839 ICTA 1988) with the Lessee.


                                  SCHEDULE 4

                                    Part 2

                   REPRESENTATIONS AND WARRANTIES BY THE LESSOR

       (A) The Lessor is duly incorporated and validly existing under the
       laws of England as a limited liability company and has the
       corporate power to own its assets and to carry on its business
       as it is being presently conducted.

       (B) The Lessor has the power to execute, deliver and perform its
       obligations under the Relevant Lease Documents to which it is
       a party and all necessary corporate, shareholder and other
       action has been duly obtained or taken to authorise the
       execution, delivery and performance of the same.

       (C) To the actual knowledge of the Lessor's directors, there is no
       pending or threatened litigation, nor any arbitration or
       administrative actions or proceedings against the Lessor or
       any of its property or assets before any court, arbitrator or
       administrative agency or authority which in the opinion of the
       directors of the Lessor would have a material adverse effect
       on the ability of the Lessor to perform at all times its
       obligations under the Relevant Lease Documents to which it is
       a party.

       (D) The execution, delivery and performance by the Lessor of its
       obligations under the Relevant Lease Documents to which it is
       a party does not contravene or constitute a default under (aa)
       any United Kingdom law, regulation, decree, convention,
       treaty, judgment or any official or judicial order valid and
       legally binding on the Lessor or any of its assets, or (bb)
       its Constitutive Documents.

       (E) This Agreement and the other Relevant Lease Documents to which
       the Lessor is or is to be a party constitutes, or when
       executed and delivered will constitute, the legal, valid and
       binding obligations of the Lessor enforceable in accordance
       with its terms subject to general principles of equity and the
       law affecting creditors' rights generally.


                                    SCHEDULE 5

                                      Part 1

         CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE LESSOR GENERALLY 

       (A) The Lessor shall have received each of the following in form
       and substance satisfactory to the Lessor:

       1. In respect of each of the Lessee, the Sub-Lessee and the
       Guarantor:

                   (a) a copy certified by a duly authorised officer of the
              relevant person to be a true, complete and up-to-date
              copy of the Constitutive Documents of that person;

                   (b) a copy, certified by a duly authorised officer of the
              relevant person to be a true copy, and as being in full
              force and effect and not amended or rescinded, of
              resolutions of the board of directors or governors (or
              of a committee of the board of directors or governors)
              of that person:

                          (i) authorising the entering into by that person 
                     of such of this Agreement and the other Lease
                     Documents to which such person is party; and

                          (ii) authorising an individual or individuals to
                     sign and deliver on behalf of that person such
                     of this Agreement and the other Lease Documents
                     to which such person is party,

                          or, in each case such other evidence as the Lessor 
              may require that all necessary corporate action has been
              taken for the authorisations referred to in paragraphs
              (i) and (ii) above;

                     (c) a copy certified by a duly authorised officer of 
              that person to be a true copy, and as being in full force
              and effect and not revoked or withdrawn, of any power
              of attorney issued by that person pursuant to the said
              resolutions; and

                     (d) a certificate of incumbency in relation to each of 
              the Lessee, the Guarantor and the Sub-Lessee together with
              a list of authorised signatories with specimen
              signatures and, in relation to the Lessee, a
              certificate of goodstanding in relation to the Lessee.

       2. Evidence that the Novation Agreement and the Put Option Deed
       has been approved by the board of directors of the Builder,
       and that the signatory for the Builder is authorised to
       execute the Novation Agreement, the Put Option Deed and the
       other Lease Documents to which the Builder is a party.

       3. A power of attorney or a certified true copy extract of the
       up-to-date signature book of each Payment Bank, evidencing the
       extent of the signing authority of all relevant signatories
       and specimen signatures of those signatories or other evidence
       reasonably acceptable to the Lessor of the authority of the
       relevant signatories to execute each of the Relevant Lease
       Documents to which each Payment Bank is party.

       4. Evidence that all governmental and other licences, approvals,
       consents, registrations and filings necessary for any matter
       or thing contemplated by the Lease Documents and for the
       legality, validity, enforceability, admissibility and evidence
       and effectiveness thereof have been obtained or effected on an
       unconditional basis and remain in full force and effect (or,
       in the case of effecting any registrations and filings, that
       arrangements are satisfactory to the Lessor have been made for
       the effecting of the same within any applicable time limit).

       5. Legal opinions in form and substance satisfactory to the
       Lessor relating to all aspects of the laws of Texas, Delaware
       and the Bahamas which the Lessor deems relevant with respect
       to the transactions contemplated by this Agreement and the
       other Lease Documents.

       6. Evidence that any licences, approvals and consents which may
       be required for the due execution and performance by any party
       to any Relevant Lease Document (other than the Lessor and the
       Deposit Bank) to which it is party have been obtained and are
       in full force and effect.

       7. Evidence from I.H.C. Gusto Engineering B.V. that the Primary
       Period does not exceed the useful economic life of the Vessel.

       8. Evidence of the acceptance of appointment by each service of
       process agent appointed or required to be appointed under the
       Relevant Lease Documents.

       9. An original counterpart of each Relevant Lease Document to
       which the Lessor is a party in each case duly executed and
       delivered by party thereto (other than the Lessor) and a
       certified true copy of other Lease Documents in each case duly
       executed and delivered by the parties thereto.

       10. Intentionally omitted.

       11. Evidence that the conditions precedent to the Relevant Lease
       Documents and the Sub-Lease (other than the conditions
       precedent contained in this Agreement to be given in favour of
       the Lessor) have been fulfilled or waived in accordance with
       the respective terms of the Relevant Lease Documents and the
       Sub-Lease. 

       12. A copy of the signed and audited report and consolidated
       accounts for the Guarantor's Group for the financial year
       ending 31st December 1997.

       13. Evidence that each of the First Account and the Second Account
       have been opened and that all necessary bank mandates and
       signature forms in form and content acceptable to the Lessor
       have been delivered to the Deposit Bank and that Pounds-Sterling 1
       has been credited to each such account.

       14. An opinion from the insurance advisors to the Lessor as to the
       adequacy of the insurances to be taken out under the
       Shipbuilding Contract.

       (B) No Termination Event or Relevant Event has occurred and is
       continuing or would result from the Relevant Lease Documents
       or the Sub-Lease coming into full force and effect.


                                 SCHEDULE 5
                                
                                   PART 2
                                
       CONDITIONS PRECEDENT TO LESSOR'S PAYMENT OBLIGATIONS UNDER THE
                     CONSTRUCTION SUPERVISION AGREEMENT


The Lessor shall have received each of the following in form and
substance satisfactory to the Lessor in relation to each Instalment:

1      CORPORATE POWER AND AUTHORITY

       1.1 Confirmation from a duly authorised officer of each of the
       Lessee, the Sub-Lessee and the Guarantor that there has been
       no change in the Constitutive Documents of the relevant person
       since the date on which a certified copy thereof was provided
       to the Lessor, or, as the case may be a copy certified by a
       duly authorised officer of the relevant person of any
       amendments thereto and confirmation that the board resolutions
       or other corporate authorisation referred to in paragraph 1(b)
       of part 1 of this Schedule 5 remain unamended and in force.

       1.2 In relation to each Payment Bank, either (i) confirmation that
       any document to be executed by such Payment Bank will be
       executed by the individuals in respect of which valid and
       existing powers of attorney appointing such individuals as
       attorneys in fact for the relevant party has already been
       received or in respect of which a certified true copy extract
       of an up to date signature book has been received and that the
       respective powers of attorney or signature books of such
       Payment Bank, remain valid, in full force and unamended or
       (ii) a further certified copy of the relevant power of
       attorney appointing such individual as an attorney in fact
       with power to sign such documents on behalf of such Payment
       Bank, or signature book of such Payment Bank, as the case may
       be.
       
2      INSURANCES

       2.1    Evidence that the Vessel is insured in accordance with the
       terms of the Shipbuilding Contract.
       
3      PAYMENTS, LETTER OF CREDIT, ACCOUNTS AND INVOICES

       3.1    Evidence that:

                   (a) the conditions precedent to the obligations of each
              Payment Bank under clause 2 of the relevant Payment
              Agreement have been satisfied in full or irrevocably
              waived in writing to the extent not so satisfied by the
              relevant Payment Bank;

                   (b) the Lessee has delivered a Lessee Payment Notice (as
              such term is defined in each Payment Agreement) to each
              Payment Bank in accordance with clause 3.1 of the
              relevant Payment Agreement in relation to the
              Instalment to be made by the Lessor hereunder; and

                   (c) each of the Payment Banks has unconditionally and
              irrevocably received in full the amount described in
              the Lessee Payment Notice (as so defined).

       3.2    Evidence that the condition precedent set out in paragraph 13
       of Schedule 5, Part 1, has been satisfied. 

       3.3    Evidence that there has been credited to each of the First
       Account and the Second Account the amount required to be
       deposited therein pursuant to the First Deposit Deed or (as
       the case may be) the Second Deposit Deed as at the relevant
       date.

       3.4    An invoice or invoices issued in favour of the Lessor duly
       executed by the Lessor's Agent or, as the case may be, the
       Builder specifying in aggregate the relevant Instalment
       payable by the Lessor and complying with the laws and
       regulations as to Value Added Tax and in the case of an
       invoice from the Lessor's Agent, attaching a copy of the
       relevant invoice received by the Lessor's Agent from the
       Builder.

       3.5    Any costs and expenses required by the terms of this Agreement
       to be paid by the Lessee and which are not taken into account
       in the Financial Schedule.

       3.6    Any amount which the Sub-Lessee is required under the terms of
       the Contribution Deed to pay to the Lessor with respect to the
       relevant Instalment and the Lessor is satisfied that it is
       entitled to retain the same.

4      THE VESSEL AND OFE

       4.1 Evidence that amounts, the Sterling Equivalent of which (as at
       the respective payment dates under the Shipbuilding Contract
       and the Construction Supervision Agreement) equals or exceeds
       the amount of the applicable Instalment, have fallen due under
       the Shipbuilding Contract and have been paid by the Lessor's
       Agent for the Lessor in accordance with the Shipbuilding
       Contract and the Construction Supervision Agreement or, as the
       case may be, are due and payable to the Builder.  Such
       evidence shall include (but not be limited to) evidence, for
       each payment made by GMIDC as the Lessor's agent, of the date,
       amount, currency, spot rate of exchange on that date (in each
       case) for purchase of that currency with Sterling and the
       resulting Sterling equivalent for each such payment.

       4.2 An invoice issued in favour of the Lessor duly executed by the
       Lessor's Agent and complying with the laws and regulations as
       to Value Added Tax in the amount of the OFE Cost (as such term
       is defined in the Novation Agreement) and listing brief
       details of the OFE to which it relates. 

       4.3 Evidence that the expenditure to be incurred by the Lessor in
       respect of the Vessel qualifies for capital allowances at the
       rate of twenty-five per cent. (25%) per annum on a reducing
       balance basis.

       4.4 Evidence that the expenditure to be incurred by the Lessor in
       respect of the OFE which is to be purchased with the relevant
       Instalment qualifies for capital allowances at a rate of
       twenty-five per cent. (25%) per annum on a reducing balance
       basis.

5      REPRESENTATIONS AND WARRANTIES

            Confirmation that each of the representations and warranties
       on the part of each Security Party under any Relevant Lease
       Document are true and accurate on the date for payment of the
       relevant Instalment as if given on that date by reference to
       the facts and circumstances then existing.

6      NO RELEVANT EVENT

            Confirmation that no Relevant Event has occurred or would
       result from the payment of that Instalment.

7.     DELIVERY INSTALMENT

            In addition to the foregoing, the following shall be further
       conditions precedent to the obligations of the Lessor to make
       payment of the Delivery Instalment.

            The Lessor shall have received each of the following in form
       and substance satisfactory to the Lessor:

                   (a) a certificate from the Lessor's Agent stating that all
              the works required pursuant to the Shipbuilding
              Contract have been completed in full and advising of
              any material changes in the nature or extent of the
              works effected in respect of the Vessel and in relation
              to any material changes to the specification for the
              Vessel;

                   (b) a valuation report for the Vessel, which shall be
              required if the certificate referred to in paragraph
              (a) above states that the works effected in respect of
              the Vessel differ in any respect considered by the
              Lessor to be material from the works required (as at
              the date of this Agreement) to be performed pursuant to
              the Shipbuilding Contract;

                   (c)  evidence of delivery of the Vessel from the Builder,
              a Certificate of Delivery (as such term is defined in the
              Shipbuilding Contract) executed by or on behalf of the
              Builder and the Lessor and all other documents to be
              handed over at delivery of the Vessel by the Builder
              pursuant to clause 12 of the Shipbuilding Contract; and

                   (d) a certificate of the insurance broker of the Lessee 
              and letter of undertaking from such broker in respect of
              the Insurances addressed to the Lessor in each case in
              form and substance acceptable to the Lessor and such
              other evidence satisfactory to the Lessor that the
              Lessee has taken the required steps or, as the case may
              be, has procured that the required steps have been
              taken, to ensure due compliance with the provisions of
              this Agreement as to Insurances with effect on or after
              the Delivery Date (including receipts (or other
              evidence of payment) for the initial and other premiums
              and calls in respect of the Insurances) together with
              an opinion from the insurance advisers to the Lessor as
              to the adequacy of the Insurances.



                                     SCHEDULE 5

                                       PART 3

                          CONDITIONS PRECEDENT TO DELIVERY


In addition to the conditions set out in Parts 1 and 2 of this
Schedule 5, the Lessor shall have received each of the following in
form and substance satisfactory to the Lessor:

       1. a certificate from the Lessor's Agent stating that all the
       works required pursuant to the Shipbuilding Contract have been
       completed in full and advising of any material changes in the
       nature or extent of the works effected in respect of the
       Vessel and in relation to any material changes to the
       specification for the Vessel;

       2. a valuation report for the Vessel, which shall be required if
       the report referred to in paragraph 1 above states that the
       works effected in respect of the Vessel differ in any respect
       considered by the Lessor to be material from the works
       required (as at the date of this Agreement) to be performed
       pursuant to the Shipbuilding Contract;

       3. evidence of delivery of the Vessel from the Builder, a
       Certificate of Delivery (as such term is defined in the
       Shipbuilding Contract) executed by or on behalf of the Builder
       and the Lessor and all other documents to be handed over at
       delivery of the Vessel by the Builder pursuant to clause 12 of
       the Shipbuilding Contract;

       4. the Acceptance Certificate duly executed by the Lessee;

       5. a certificate duly executed by the Sub-Lessee evidencing the
       Sub-Lessee's acceptance of the Vessel in accordance with the
       terms of the Sub-Lease;

       6. a certificate of the insurance broker of the Lessee and letter
       of undertaking from such broker in respect of the Insurances
       addressed to the Lessor in each case in form and substance
       acceptable to the Lessor and such other evidence satisfactory
       to the Lessor that the Lessee has taken the required steps or,
       as the case may be, has procured that the required steps have
       been taken, to ensure due compliance with the provisions of
       this Agreement as to Insurances with effect on or after the
       Delivery Date (including receipts (or other evidence of
       payment) for the initial and other premiums and calls in
       respect of the Insurances) together with an opinion from the
       insurance advisers to the Lessor as to the adequacy of the
       Insurances;

       7. a confirmation of the Classification issued by the
       Classification Society dated not more than three (3) Business
       Days prior to Delivery showing the Classification of the
       Vessel free from recommendations and notations affecting class
       which are overdue at such date;

       8. evidence of the registration of the Vessel in the Flag State
       in the name and ownership of the Lessor free from registered
       Liens;

       9. copies, certified as true copies by an authorised signatory of
       the Lessee of the trading certificates for the Vessel and the
       Vessel Response Plan and Certificate of Financial
       Responsibility, if required, for the operator of the Vessel in
       a form approved by the U.S. Coast Guard or other relevant U.S.
       governmental authorities and agencies and, if required by any
       other countries, a copy of such other certificates, plans or
       policies as is required for the Vessel to meet the oil
       pollution or other environmental legislation of such other
       countries;

       10. evidence that on the Delivery Date all of the conditions
       precedent required to each party's respective obligations
       under the Relevant Lease Documents and the Sub-Lease have been
       satisfied or waived including a certificate to that effect
       from the Lessee;

       11. copies of all consents, authorisations and approvals of any
       governmental agency or authority and of any trustee or holder
       of any indebtedness or obligations of the Lessee, the
       Sub-Lessee or the Guarantor which are required in connection
       with the Delivery of the Vessel and the leasing of the Vessel
       under this Agreement and the Sub-Lease, duly certified by a
       representative or, as the case may be, an officer of the
       Lessee, the Sub-Lessee or the Guarantor, as the case may be,
       or confirmation in writing by a representative or, as the case
       may be, an officer of the Lessee, the Sub-Lessee or the
       Guarantor, as the case may be, that no such consents,
       authorisations or approvals are required;

       12. evidence that on the Delivery Date all filings, registrations,
       recordings and other actions required to be taken prior to the
       Delivery Date which are necessary or advisable to ensure the
       validity and effectiveness of the Relevant Lease Documents and
       the Sub-Lease and to protect the property rights of the Lessor
       in the Vessel, have been or will be taken;

       13. confirmation from each of the providers of the legal opinions
       referred to in paragraph 5 of Part 1 of Schedule 5 that the
       terms and provisions of such legal opinions provided pursuant
       to paragraph 5 of part 1 of Schedule 5 need not be altered or
       modified in any way.

       14 confirmation that each of the representations and warranties
       on the part of each Security Party under each Relevant Lease
       Document to which they are respectively party are true and
       accurate on the Delivery Date as if given on that date by
       reference to the facts and circumstances then existing;
       
       15 evidence that no Termination Event or Relevant Event has
       occurred or would result from the Delivery of the Vessel on
       the Delivery Date or the leasing of the Vessel to the Lessee
       pursuant to this Agreement or the sub-leasing of the Vessel to
       the Sub-Lessee pursuant to the Sub-Lease.


                                  SCHEDULE 5
                                
                                    PART 4
                                
       CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE LESSEE GENERALLY


The Lessee shall have received each of the following in form and
substance satisfactory to the Lessee:

       1.     In respect of each of the Lessor:
       
                   (a) a copy certified by a duly authorised officer of the
              Lessor to be a true, complete and up-to-date copy of
              the Constitutive Documents of the Lessor;

                   (b) a copy certified by a duly authorised officer of the
              Lessor to be a true copy, and as being in full force
              and effect and not amended or rescinded, of resolutions
              of the board of directors or governors (or of a
              committee of the board of directors or governors) of
              the Lessor:

                          (i) authorising the entering into by that person
                     of such of this Agreement and the other Relevant
                     Lease Documents to which the Lessor is party;
                     and

                          (ii) authorising an individual or individuals to
                     sign and deliver on behalf of the Lessor such
                     of this Agreement and the other Relevant Lease
                     Documents to which the Lessor is party;

                   (c) a copy certified by a duly authorised officer of the
              Lessor to be a true copy of any power of attorney
              issued by the Lessor pursuant to the said resolutions.

       2.     A guarantee and a support letter from the Bank.

       3.     In respect of the Bank, a copy certified by a duly authorised
       officer of the Bank, to be a true, complete and up-to-date
       copy of the relevant extracts of the Bank's signature book.

       4.     Legal opinions from Canadian, German and English counsel.



                                     SCHEDULE 6
                                
                          FORM OF ACCEPTANCE CERTIFICATE


Acceptance Certificate dated [               ] pursuant to a Lease
Agreement dated [     ], 1998 (the "HEAD LEASE") between Nelstar
Leasing Company Limited (the "LESSOR") as lessor and Global Marine
Leasing Corporation (the "LESSEE") as lessee.

Terms used herein shall have the meaning given thereto in the Head
Lease.

       1. The Lessee confirms that, as between the Lessor and the Lessee
       and without prejudice to the rights either party has or may
       have against the Builder, the Vessel has been delivered by the
       Lessor to the Lessee and accepted by the Lessee from the
       Lessor on [              ] in a condition and otherwise all in
       accordance with the Head Lease free of all Liens other than
       the Permitted Liens.

       2. The Lessee confirms that on the aforesaid date of delivery the
       Vessel became subject to and governed by the provisions of the
       Head Lease.

       3. The Lessee confirms that as at the date hereof:

                   (i) no Relevant Event has occurred and is continuing; and

                   (ii) the representations set out in Part 1 of Schedule 4 
              of the Head Lease are true and accurate.


SIGNED                               )
by                                   )
a [duly authorised attorney-in-fact] )
for and on behalf of                 )
GLOBAL MARINE LEASING CORPORATION    )



                                      SCHEDULE 7



        FORM OF HULL AND MACHINERY (MARINE AND WAR RISKS) LOSS PAYABLE CLAUSE


All recoveries under this policy shall be applied as follows:

       (a) at any time during the Lease Period, all claims hereunder in
       respect of actual or constructive or compromised or arranged
       total loss shall be paid in full to such account of the Lessor
       as the Lessor may notify to the insurers; and 

       (b) all other claims hereunder shall be paid in full to the Lessee
       or to its order.


EXECUTED as a DEED and DELIVERED   )
for and on behalf of               )
NELSTAR LEASING COMPANY LIMITED    )
by PETER BERNARD MILES             )
its                                )
in the presence of: LISA J. BIGGS  )




EXECUTED as a DEED, SEALED and     )
DELIVERED for and on behalf of     )
GLOBAL MARINE LEASING CORPORATION  )
by WALTER A. BAKER its             ) 
in the presence of: LISA J. BIGGS  )