<PAGE>   1
                                                                   EXHIBIT 10.11

[REGIONS BANK LOGO]

May 11, 2001

Mr. Lyle Stockstill
Mrs. Lana Hingle Stockstill
Torch Offshore, LLC
401 Whitney Ave., Suite 400
Gretna, LA 70056-2596

Dear Mr. and Mrs. Stockstill:

We are pleased to confirm that Regions Bank (hereinafter referred to as "Bank")
holds available a renewal of the working capital line of credit to Torch
Offshore, LLC. (hereinafter referred to as "Borrower"). If accepted, the total
amount potentially available on the line of credit would be $8,000,000. The
purpose of this facility is to provide working capital. This agreement is joined
herein by Torch, Inc., Lyle Stockstill and Lana Hingle Stockstill as
"Guarantors".

WORKING CAPITAL LINE OF CREDIT - $8,000,000
-------------------------------------------

EXPIRATION DATE:    November 12, 2001

INTEREST RATE:      London Interbank Offered Rate (LIBOR) plus 300 Basis Points
                    adjusted monthly based on 30-day LIBOR rate for the final
                    day of the month. Accrued interest on actual draws shall be
                    due and payable monthly.

INDEBTEDNESS:       Debt under the line shall be evidenced by a Base Note in the
                    amount of $8,000,000 against which cash advances may be
                    made, at Bank's discretion, given availability as defined
                    below and upon written or verbal request from Borrower.
                    Borrower will supply to Bank prior to the first draw in
                    writing the names of those persons authorized on behalf of
                    Borrower to request funding.

COMMITMENT FEE:     Non-refundable fee in the amount of $20,000 ($7,287
                    collected previously) which represents 1/2% of the committed
                    line. Commitment fee is payable at loan closing.

AVAILABILITY:       Availability to borrow shall be determined on a formula
                    basis of 80% of current (less than 90 days old and
                    "ineligible receivables" subject to the 25% rule)
                    receivables provided total debt under this line does not
                    exceed $8,000,000 at any time. The 25% rule on receivables
                    shall be defined as follows: Any account debtor with over
                    25% of the total receivable over 90 days old shall not be
                    eligible for the total amount of receivables owed to
                    Borrower.

Post Office Box 30280    New Orleans, Louisiana 70190    Telephone 504-587-1888

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               Borrower shall provide Bank on a monthly basis a properly
               executed Settlement Report certified to by an authorized
               corporate official along with a listing and aging of accounts
               receivable and an inventory listing. These documents shall be due
               within 10 days after each month end. Failure to provide these
               documents may result in the delay of advancement of additional
               funds until such time as the documents are received.

REPAYMENT:     (1)  Upon receipt, Borrower shall deposit all collections of
               accounts receivable in their original form into a Torch
               Offshore, LLC, assignee cash collateral account entitled
               "Regions Bank as Assignee of Accounts Receivable of Torch
               Offshore, LLC". Within two business days following such
               deposits, Bank will debit the account for a like amount and
               apply these funds as a principal reduction of the debt. However,
               if deemed necessary, the Bank reserves the right to hold funds
               in an uncollected status and apply them to the line of credit as
               regulated under the "Expedited Funds Availability Act". Should
               any deposit item be returned for non-payment, it shall be charged
               to Borrower's operating account.

               (2)  Borrower has the option in lieu of (1) above, to notify all
               of its customers to forward payment under any and all invoices
               to the following lock-box controlled by the Bank, "Torch
               Offshore, LLC., P.O. Box 15179, New Orleans, LA 70175". Should
               Borrower receive any payments directly from the customer,
               Borrower will deposit all of these collections in their original
               form into a Torch Offshore, LLC. assignee cash collateral
               account entitled "Regions Bank as Assignee of Accounts
               Receivable of Torch Offshore, LLC". All payments received
               through the lock box will also be deposited into the cash
               collateral account. The Bank will debit the cash collateral
               account and apply 100% of the proceeds to the line of credit as
               a principal reduction. Should any deposit item be returned for
               non-payment it shall be charged to the Borrower's operating
               account.

COLLATERAL:    (1)  First position security interest in all chattel paper,
               accounts, contract and contract rights and inventory as
               evidenced by security agreement of even date.

               (2)  Cross pledge of First Security interest on equipment to be
               purchased with Bank funds (reel equipment loan).

               (3)  Cross pledge of assignment of life insurance for $1,000,000
               on the life of Lyle Stockstill.
<PAGE>   3


Torch Offshore, LLC                 3
5/11/01

              (4) Pledge of 3 Merrill Lynch brokerage accounts with marketable
              securities in an approximate amount of $900,000; accounts to be
              pledged to the personal guarantee of Lana Hingle Stockstill. This
              collateral will be released by Bank at such time that the total
              debt to tangible net worth of Borrower is 3 to 1 (see pages 7 and
              8) or less for 90 consecutive days, following submission of
              month-end financial statements and assuming no defaults under this
              agreement or the loan documents for this loan or any other
              outstanding loan at Bank.

              In addition, two collateral/documentation exceptions must be
              cured prior to release of collateral securing the personal
              guarantee.

               1. The $1 Million life insurance policy on Lyle Stockstill must
                  be fully in place and properly pledged and acknowledged to
                  Bank.

               2. The First Amendment to InterCreditor Agreement for
                  Subordination of Liens regarding the reel equipment loan must
                  be signed by Transamerica.

GUARANTORS:   Unconditional continuing personal guarantee of Lyle Stockstill and
              Lana Hingle Stockstill equal to the outstanding balances of
              Borrower including principal, interest and any other charges.

              Unconditional corporate guarantee of Torch, Inc. equal to the
              outstanding balances of Borrower, including principal, interest
              and any other charges.

SPECIFIC CONDITIONS OF FUNDING YOUR LINE OF CREDIT:
(Note: These conditions are outlined here to clarify the mechanics of how we
will fund your line of credit. This letter is not intended, however, to
supersede the legal documents associated with this line.)

Lendable equity in collateral is described as:

                80% of eligible accounts receivable of Borrower.

An operating account and a cash collateral account will be established. All
draws will be deposited to the operating account. The Borrower agrees to deposit
all proceeds in their original form from the collection of accounts receivable
into the cash collateral account. Bank will apply funds from the cash collateral
account to the line of credit to pay down the balance. Should the line of credit
be zero, it is understood that funds deposited to the Cash Collateral Account
will be transferred within two business days to the Operating Account. If checks
written on the operating account exceed the balance in the account, or a sweep
account tied to the operating account, Bank will


<PAGE>   4
Torch Offshore, LLC                 4
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fund on the line of credit (to the extent that the advance is covered by
eligible receivables and availability under the line of credit) to cover the
shortfall. Ineligible accounts receivable, which will be placed in "reserve" and
not be included on "eligible" accounts, are described as follows:

           (1)      Accounts over 90 days old
           (2)      Contra Accounts
           (3)      Foreign receivables
           (4)      Government receivables (state, local and federal)
           (5)      Affiliate receivables
           (6)      Credit memos
           (7)      Accounts subject to the 25% rule
           (8)      Consignments
           (9)      Retainages
          (10)      Progress Billings.
          (11)      Bill and Hold
          (12)      Concentrations -- Bank reserves the right to limit its
                    exposure in any one customer of (Borrower) to 25% of the
                    committed balance on the line of credit. All Fortune 500
                    companies in good standing, to be determined by Bank, will
                    be exempted from the concentration rule provided payment
                    history of the Fortune 500 Company has been satisfactory.
          (13)      Accounts receivable from debtors that the Bank believes are
                    in poor financial condition.
          (14)      Receivables relating to billings on bonded contracts or
                    those subject to "super priority" liens under bankruptcy
                    codes.

In addition, the Bank reserves the right to determine which accounts receivable
are eligible. Refusal by Regions Bank to accept any receivables as eligible
accounts for a loan shall not be deemed as a breach of agreement.

Whenever the balance on your line of credit exceeds lendable equity in
collateral as described above, we will notify you. You will then have ten (10)
days to correct this deficiency, either through bringing us additional
collateral or through reducing the balance on your line of credit to a level
sufficient to clear the deficit. This will be considered an event of default.
The Bank reserves the right to withhold future advances until the deficit in
question has been eliminated.

Under no circumstances are invoices to be presented to the undersigned as
collateral unless the service or work has been completed and the original
invoice has been presented to your customer for payment.

The above commitment is subject to a satisfactory audit of Borrower's accounts
receivable and inventory. The Bank will perform an audit of the books and
records of Borrower on a quarterly basis. The Bank has the right to waive an
audit at its sole discretion, however the waiving of any audit or audits will
not be considered a change to the frequency of future audits. Borrower agrees

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Torch Offshore, LLC.                   5
5/11/01

to provide Bank with whatever data is necessary for Bank to prepare this audit.
As long as there is no event of default, Bank will normally give at least 48
hours notice of an audit, and Bank will make every effort to arrange a time
that is mutually agreeable. We may also (using the name Louisiana Accounting
Services or some other non-bank name), from time to time, verify your accounts
receivable.

OTHER CONDITIONS:

The foregoing line of credit (herein referred to as "the debt") is approved
with the understanding that, within 120 days after the close of the fiscal
year, Bank will be provided with an audited financial statement of Borrower and
a personal detailed financial statement on the Guarantor. A tax return of
Borrower and Guarantor is to be provided within 180 days after the close of the
fiscal year. A monthly in-house prepared balance sheet and operating statement
on Borrower is to be submitted to Bank as well.

The above commitment is contingent upon the maintenance of a financial
condition of Borrower and Guarantor satisfactory to Bank, and compliance with
the terms and conditions of the loan and collateral documents executed in
connection herewith.

Also, unless Bank otherwise consents in writing and so long as the debt to Bank
remains outstanding, Borrower and Guarantor each agree to:

     (1)  Pay each note in accordance with the terms and conditions thereof;

     (2)  Fully maintain the franchise of Borrower;

     (3)  Provide Bank with certified copies of resolutions from the Borrower
          specifically authorizing execution of this agreement and the loan and
          collateral documents hereinabove referred to;

     (4)  Duly pay and discharge, or cause to be paid and discharged all taxes,
          assessments, and other governmental charges lawfully imposed upon the
          property of Borrower or upon any part thereof, or upon the income or
          profits thereof and comply with all municipal, state and federal laws
          provided that Borrower reserves all of its rights to protest the
          payment of any such taxes, assessment and other governmental charges
          contested in good faith;

     (5)  Duly comply with applicable statutes and pay all obligations which, if
          unpaid, might result in a lien, except those obligations which are
          being contested in good faith;

     (6)  Maintain principal banking relationship of Borrower and Guarantor with
          Bank.
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Torch Offshore, LLC.                   6
5/11/01

It is also further understood and agreed by Borrower and Guarantor that so long
as all or any part of the debt remains outstanding, Borrower and Guarantor will
not without Bank's prior written consent;

     (1)  Other than the debt, create or suffer to exist any other mortgage or
          pledge, or hypothecate or create any other lien on any part of the
          pledged collateral;

     (2)  Enter into any merger, consolidation, or major expansion, make any
          investment, create any subsidiaries, or sell or lease any significant
          portion of Borrower's assets, whether it be to a related company, or
          any other entity, or effect any change in the ownership of Borrower;

     (3)  Create, incur, assume, or  have outstanding any new indebtedness over
          $500,000 in the aggregate other than indebtedness to Borrower's
          suppliers of material, labor, services as incurred in the ordinary
          course of Borrower's business.

The Borrower agrees to give immediate notice to the Bank of (1) any litigation
or proceeding in which any of them is a party if an adverse decision
therein would require them to pay over more than $50,000 or deliver assets the
value of which exceeds such sum (whether or not the claim is considered to be
covered by insurance); and (2) the institution of any other suit or proceeding
involving any of them that might materially and adversely affect their
operations, financial condition, property or business.

If any one or more of the following events, herein called "Events of Default",
shall occur and be continuing for a period of 10 days without cure, the
principal and the accrued interest on all indebtedness under the agreement
shall become immediately due and payable upon demand of Bank:

     (a)  Borrower shall default in the payment of any principal or interest,
          when due under any notice that evidences any sum payable by Borrower
          under this agreement; or

     (b)  Default by Borrower in the due observance and performance of any other
          covenant, agreement, undertaking or condition expressed or contained
          in this Loan Agreement, or any prior agreement, or in any documents
          provided for herein or in connection herewith, or default by any
          person (authorized corporate officer or appointee) or Guarantor in the
          due observance and performance of any covenant, undertaking, agreement
          or condition contained in any documents executed and delivered to Bank
          in order to induce it to enter into this Loan Agreement or any prior
          agreement; or

     (c)  Any representation or warranty made herein or made on any certificate
          furnished to or to be furnished to Bank hereunder or made in any
          instrument delivered pursuant hereto shall prove to have been
          materially incorrect; or

     (d)  Borrower shall voluntarily suspend transaction of its business for
          more than one
<PAGE>   7

Torch Offshore, LLC.                   7
5/11/01

    month; or become insolvent or be unable to pay its debts as they mature; or
    file a voluntary petition in bankruptcy; or file a voluntary petition
    seeking reorganization; or effect a plan or other arrangement with
    creditors; or file an answer admitting jurisdiction of the court and the
    material allegations of an involuntary petition filed pursuant to any act of
    Congress relating to bankruptcy; or make an assignment for benefit of
    creditors; or apply for consent to the appointment of any receiver or
    trustee for itself or of all or any substantial portion of its property; or

(e) An order shall be entered pursuant to any act of Congress relating to
    Bankruptcy or to any act purporting to be amendatory thereof approving an
    involuntary petition seeking reorganization of Borrower, or an order of any
    court shall be entered appointing any receiver or trustee for Borrower or
    any receiver or trustee of all or any substantial portion of the property of
    Borrower or any receiver or trustee of all or any substantial portion of the
    property of Borrower, or a writ or warrant of attachment or any similar
    process shall be issued by any court against property of Borrower, and such
    order approving petition seeking reorganization or appointing a receiver or
    trustee is not vacated or stayed or such writ, warrant of attachment of any
    similar process is not released or bonded within sixty (60) days after its
    entry or levy; or

(f) The Borrower shall fail to pay any indebtedness due any third persons and
    such failure shall continue beyond any applicable grace period, or the
    Borrower shall suffer to exist any other event of default under any
    agreement binding the Borrower; or

(g) The Borrower shall suffer final judgments for payment of money aggregating
    in excess of $10,000 and shall not discharge the sale within a period of
    thirty (30) days unless, pending further proceedings, execution has not been
    commenced or if commenced, has been effectively stayed; or

(h) A judgment creditor of the Borrower shall obtain possession of any of the
    collateral by any means, including, but without limitation, levy, replevin,
    or self help; or

(i) The validity or enforceability of this Agreement, the Notes, the Guaranties,
    or the collateral documents shall be contested by the Borrower, or the
    Borrower shall deny that it has any or future liability or obligation
    hereunder or thereunder.

(j) Borrower fails to maintain (unless specifically waived in writing by Bank)
    the following financial ratios as compiled in accordance with generally
    accepted accounting principles:

    (i)   Total debt to Tangible Net Worth not to exceed 3 to 1.

    (ii)  Minimum debt service ratio for a trailing 4-quarter period of not less
          than 1.2 computed as of the end of each quarter.

    (iii) Minimum Tangible Net Worth of $10 Million.

The debt service ratio will be computed by taking net income plus depreciation
plus
<PAGE>   8
Torch Offshore, LLC.                    8
5/11/01

     interest expense plus any other non-cash charges and dividing by current
     maturities of long-term debt plus interest expense.

     Tangible Net Worth is the Borrower's Net Worth as reflected on the
     Borrower's financial statements prepared in accordance with General
     Accepted Accounting Principles (GAAP) but excluding:

     1) Any assets ordinarily classified as intangible in accordance with GAAP.

     2) Any accounts due from Officers, Shareholders or Affiliates.

Upon the occurrence of any event of default hereunder, Bank shall have no
further obligation to continue the line of credit or to make any further
advances hereunder.

In the event of default under any condition of the loan, we have the right to
visit your place of business for the purpose of inspecting the books and records
at a time and frequency at out discretion. In this event, you agree to allow us
access to all financial records, agings, bank statements, invoices, and payment
records generated by Borrower, to allow us to obtain copies of any invoices,
agings or payment records we deem necessary, and agree to allow us to instruct
your customers to remit payment on your behalf to the Bank.

To the extent that any terms and provisions of any promissory notes, security
agreements, guaranty or other documents executed by Borrower or any Guarantor in
connection with the line of credit are inconsistent with the terms and
provisions of this agreement, this agreement shall govern. On the other hand,
if any terms and provisions of the line of credit documents are not specifically
covered by the terms and provisions of this agreement, then the line of credit
documents shall govern.

This commitment may not be assigned or otherwise transferred. If this commitment
is acceptable to you, please sign at the space indicated below and on the
enclosed duplicate attached hereto and return same to us at:

                                        Regions Bank
                                        301 St. Charles Avenue
                                        New Orleans, Louisiana 70130

This offer will expire 30 days from the date hereof, unless we receive your
acceptance on or before that date.

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Torch Offshore, LLC              9
5/11/01

We sincerely appreciate this opportunity to handle Torch Offshore,LLC.'s
banking needs; our relationship with your fine organization will certainly be a
valued one, and we hope that you will continue to call on us whenever we may be
of service.


Sincerely,

REGIONS BANK

/s/ Jorge E. Goris
---------------------------------
Jorge E. Goris
Senior Vice President


JEG:lch


We hereby accept and agree with the terms and conditions as outlined above on
this the 11th day of May, 2001.


TORCH OFFSHORE, LLC.


/s/ Lyle Stockstill
---------------------------------------------------------------
Lyle Stockstill, Manager/Chairman and Chief Executive Officer


/s/ Lana Hingle Stockstill
---------------------------------------------------------------
Lana Hingle Stockstill, Manager
<PAGE>   10
Torch Offshore, LLC.
5/11/01


                                       10




                             CONSENT AND AGREEMENT

The undersigned do/does hereby join in the execution of this loan agreement for
the purpose of (i) manifesting his/their approval of the terms and conditions
hereof and (ii) consenting  and agreeing to the provisions hereof concerning
the guaranty agreement and any representations and warranties, affirmative
covenants and negative covenants herein that expressly relate to any or all of
the undersigned.

/s/ Lyle Stockstill
-------------------------------------------------
Lyle Stockstill

/s/ Lana Hingle Stockstill
-------------------------------------------------
Lana Hingle Stockstill


TORCH, INC.


/s/ Lyle Stockstill
-------------------------------------------------
Lyle Stockstill, Chief Executive Officer


/s/ Lana Hingle Stockstill
-------------------------------------------------
Lana Hingle Stockstill, Secretary
<PAGE>   11
                              [REGIONS BANK LOGO]
                 LIMITED LIABILITY COMPANY BORROWING AGREEMENT

<TABLE>
<CAPTION>
PRINCIPAL     LOAN DATE    MATURITY     LOAN NO.  CALL   COLLATERAL   ACCOUNT  OFFICER   INITIALS
---------     ---- ----    --------     ---- ---  ----   ----------   -------  -------   --------
<S>           <C>          <C>         <C>        <C>    <C>          <C>       <C>      <C>
$8,000,000.00  05-11-2001   11-12-2001  0001301    590    4635         5439329   L32
-------------------------------------------------------------------------------------------------
  References in the shaded area are for Lender's use only and do not limit the
         applicability of this document to any particular loan or item.
-------------------------------------------------------------------------------------------------


Borrower:  TORCH OFFSHORE, L.L.C. (TIN: 7201471586)   Lender: Regions Bank TIN: 63-0371391
           401 WHITNEY AVENUE SUITE 400                       Commercial Lending
           GRETNA, LA 70056-2503                              301 St. Charles Avenue
                                                              3rd Floor
                                                              New Orleans, LA 70130
==================================================================================================
</TABLE>

THIS LIMITED LIABILITY COMPANY BORROWING AGREEMENT between TORCH OFFSHORE,
L.L.C. ("Borrower"), and Borrower's Members signing Below ("Members"), and
Regions Bank ("Lender") and shall apply to any and all present and future loans,
loan advances, extension of credit, financial accommodations and other
agreements and undertakings of every nature and kind that may be entered into by
and between Borrower and Lender now and in the future.

DEFINITIONS. The following words shall have the following meanings when used in
this Agreement. Terms not otherwise defined in this Agreement shall have the
meanings attributed to such terms in the Louisiana Commercial Laws (La. R.S. 10:
9-101, et. seq.). All references to dollar amounts shall mean amounts in lawful
money of the United States of America.

     AGREEMENT. The word "Agreement" means this Limited Liability Company
     Borrowing Agreement, as this Limited Liability Company Borrowing Agreement
     may be amended or modified from time to time, together with all exhibits
     and schedules attached or to be attached to this Limited Liability Company
     Borrowing Agreement from time to time.

     ARTICLES. The word "Articles" means and includes Borrower's Articles of
     Organization as presently on file with Office of the Louisiana Secretary
     of state, and as such Articles may subsequently be amended or modified
     from time to time, one or more times.

     AUTHORIZED REPRESENTATIVES. The words "Authorized Representatives" mean and
     include, individually, collectively, interchangeably, any and all persons
     authorized by Borrower's Members or Managers to act for and on behalf of
     Borrower in dealings with Lender.

     COLLATERAL. The word "Collateral" means and includes individually,
     collectively, interchangeably and without limitation all property and
     assets granted as collateral security for a Loan, whether real or personal
     property, whether granted directly or indirectly, whether granted now or
     in the future, and whether granted in the form of a security interest,
     mortgage, collateral mortgage, deed of trust, assignment, pledge, crop
     pledge, chattel mortgage, collateral chattel mortgage, chattel trust,
     factor's lien, equipment trust, conditional sale, trust receipt, lien,
     charge, lien or title retention contract, lease or consignment intended as
     a security device, or any other security or lien interest whatsoever,
     whether created by law, contract or otherwise.

     EVENT OF DEFAULT. The words "Event of Default" mean individually,
     collectively, and interchangeably any of the Events of Default set forth
     below in the section titled "Events of Default."

     GRANTOR. The word "Grantor" means and includes individually, collectively,
     interchangeably and without limitation each and all of the persons or
     entities granting a Security Interest in any Collateral for the
     indebtedness, including without limitation all Borrowers granting such a
     Security interest.

     GUARANTOR. The word "Guarantor" means and includes individually,
     collectively, interchangeably and without limitation each and all of the
     guarantors, sureties, and accommodation parties in connection with the
     indebtedness.

     INDEBTEDNESS. The word "Indebtedness" means and includes individually,
     collectively, interchangeably and without limitation, any and all present
     and future loans, extensions of credit, liabilities and/or obligations of
     every nature and kind whatsoever that Borrower may now and in the future
     owe to or incur in favor of Lender and its successors or assigns,
     including without limitation, Borrower's indebtedness in favor of Lender
     under the Note, whether such loans, extensions of credit, liabilities
     and/or obligations are direct or indirect, or by way of assignment, and
     whether related or unrelated, or whether committed or purely
     discretionary, and whether absolute or contingent, voluntary or
     involuntary, determined or undetermined, liquidated or unliquidated, due
     or to become due, together with interest, costs, expenses, attorneys' fees
     and other fees and charges, whether or not any such Indebtedness may be
     barred under any statute of limitations or may be otherwise unenforceable
     or voidable for any reason.

     LENDER. The word "Lender" means Regions Bank TIN: 63-0371391, its
     successors and assigns, and any subsequent holder or holders of the Note,
     or any interest therein.

     LOAN. The words "Loan" and "Loans" mean and include any and all loans and
     financial accommodations from Lender to Borrower [or any of them] whether
     now or hereafter existing, and however evidenced, including without
     limitation those loans and financial accommodations described herein or
     described on any exhibit or schedule attached to this Agreement from time
     to time, and further including any and all subsequent amendments,
     additions, substitutions, renewals and refinancings of Borrower's Loan.

     MEMBER. The words "Member" or "Members" mean and include, individually,
     collectively, interchangeably, any and all present and future member
     owners of Borrower.

     MEMBERSHIP INTEREST. The words "Membership Interest" mean and include a
     Member's ownership rights and interest in Borrower, including without
     limitation, a Member's share of the profits and losses of Borrower, right
     to receive distributions of Borrower's assets, and any right to vote or
     participate in the management and affairs of Borrower.

     NOTE. The word "Note" means Borrower's promissory note or notes
     evidencing Borrower's Loan obligations in favor of Lender, as well as any
     substitute, replacement or refinancing note or notes therefor.

     OPERATING AGREEMENT. The words "Operating Agreement" mean any agreement
     between Borrower's Members governing the affairs of Borrower and the
     conduct of its business.

     RELATED DOCUMENTS. The words "Related Documents" mean and include
     individually, collectively, interchangeably and without limitation all
     promissory notes, credit agreements, loan agreements, environmental
     agreements, guarantees, security agreements, mortgages, collateral
     mortgages, deeds of trust, and all other instruments, agreements and
     documents, whether now or hereafter existing, executed in connection with
     the indebtedness.

     SECURITY AGREEMENT. The words "Security Agreement" mean and include
     individually, collectively, interchangeably and without limitation


<PAGE>   12
05-11-2001       LIMITED LIABILITY COMPANY BORROWING AGREEMENT            Page 2
Loan No 0001301                    (Continued)
================================================================================

     any agreements, promises, covenants, arrangements, understandings or other
     agreements, whether created by law, contract, or otherwise, evidencing,
     governing, representing, or creating a Security Interest.

     SECURITY INTEREST.  The words "Security Interest" mean and include
     individually, collectively, interchangeably and without limitation any and
     all present and future mortgages, pledges, crop pledges, assignments and
     other security agreements directly or indirectly securing the repayment of
     Borrower's Loan and Note, whether created by law, contract, or otherwise.

EFFECT OF AGREEMENT.  THE FOLLOWING PROVISIONS PERTAIN TO THE EFFECT OF THIS
AGREEMENT.

     APPLICABILITY.  This Agreement shall apply to any and all present and
     future indebtedness, contracts, agreements and undertakings by and between
     Borrower and Lender for any purpose whatsoever.

     AMENDMENT TO OPERATING AGREEMENT.  This Agreement shall for all purposes be
     considered and shall have the same effect as an amendment to, and shall
     comprise a part of Borrower's Operating Agreement, and shall be binding
     upon Borrower and all of Borrower's present and future Members. To this
     end, all persons subsequently acquiring Membership Interests in Borrower
     for all purposes shall be deemed to be bound and obligated under the terms
     and conditions of this Agreement just as if said subsequently added Members
     had signed this Agreement along with the Members signing below, with the
     consent and agreement of such subsequently added Members to be so bound and
     obligated hereunder being an absolute condition precedent to such persons
     acquiring Membership Interests in Borrower.

TERM AND TERMINATION.  This Agreement shall remain in effect until such time as
(a) all indebtedness has been fully paid and satisfied and there is no further
commitment or obligation on the part of Lender to extend any additional
indebtedness and (b) Lender agrees to cancel and terminate this Agreement after
being requested by Borrower in writing to do so.

AUTHORIZED REPRESENTATIVES.  THE FOLLOWING PROVISIONS PERTAIN TO, AMONG OTHER
THINGS, THE AUTHORIZATION OF PERSONS UNDER THIS AGREEMENT.

     RESOLUTIONS.  The Members of Borrower have met and have properly authorized
     certain designated persons ("Authorized Representatives") to represent
     Borrower and to act for and on behalf of Borrower in dealings with Lender.
     To the extent applicable, such Authorized Representatives are listed in a
     separate form of Resolution or other communication delivered to Lender.

     MANAGERS.  Borrower's present and future Managers (to the extent that
     Borrower has Managers) shall always have the full and unrestricted
     authority to deal with Lender and shall be considered Authorized
     Representatives of Borrower without the additional necessity of being
     specifically designated as such by Borrower's Members under a formal
     resolution.

     UNRESTRICTED AUTHORITY.  Notwithstanding any provision of Borrower's
     Operating Agreement to the contrary, or any resolution of Borrower's
     Members not previously communicated to Lender in writing. Borrower's
     Authorized Representatives (including without limitation Borrower's
     Managers) shall have the full and unrestricted right, power and authority
     to deal and to contract with Lender and to otherwise bind and unrestricted
     right, power and authority, from time to time, one or more times, and
     without the necessity of obtaining the further approval of all or a
     majority of Borrower's Members: (a) to obtain loans, loan advances, and to
     incur other indebtedness and obligations in favor of Lender in any amount
     and for any purpose, and whether or not deemed to be in the ordinary course
     of Borrower's business; and (b) to sell, exchange, lease, mortgage, pledge,
     or otherwise transfer or encumber or grant Security Interests in favor of
     Lender as affecting any or all or substantially all of the assets and
     movable (personal) and immovable (real) properties of Borrower, including
     without limitation, entering into mortgages and security agreements that
     contain confessions of judgment and consents to foreclosure remedies under
     Louisiana executory process procedures; and (c) otherwise to enter into
     such agreements and to incur such obligations in favor of Lender as such
     Authorized Representatives may deem to be necessary and proper.

     SUBSTITUTE AUTHORIZED REPRESENTATIVES.  Lender may continue to deal and
     contract with such Authorized Representatives on an unrestricted basis
     until such time as: (a) their authority to act for and on behalf of
     Borrower is formally revoked and substitute Authorized Representatives are
     properly appointed by Borrower's Members, and (b) Lender is properly
     notified in writing and accepts and acknowledges the same.

REPRESENTATIONS AND WARRANTIES.  Borrower represents and warrants to Lender as
of the date of this Agreement and continuously thereafter so long as this
Agreement remains in effect:

     ORGANIZATION.  Borrower is a limited liability company that is duly
     organized, validly existing, and in good standing under the laws of the
     State of Louisiana. Borrower has further qualified to do business in each
     jurisdiction where the extent and nature of Borrower's business activities
     require such qualification.

     AUTHORIZATION.  Borrower's execution, delivery and performance of this
     Agreement and of the Related Documents have been duly authorized, and do
     not conflict with, and will not result in a violation of, or constitute or
     give rise to an Event of Default under Borrower's Articles, or under
     Borrower's Operating Agreement, or any agreement or other instrument which
     may be binding upon Borrower, or under any law or governmental regulation
     or court decree or order applicable to Borrower and/or its properties.
     Borrower has the further power and authority to own and to hold all of its
     assets and properties and to carry on its business as presently conducted.

     MEMBERS.  The following is a complete list of all of Borrower's present
     Members, all of whom have signed this Agreement have agreed to be bound and
     obligated under this Agreement. There are no other present Members of
     Borrower.

<TABLE>
<CAPTION>
               NAMES                              COMPANY MANAGER
               -----                              ---------------
               <S>                                <C>
               LYLE STOCKSTILL, CHAIRMAN, GEO     Yes
               (SSN-438-58-8059)
               LANA HINGLE STOCKSTILL             Yes
               (SSN-437-54-7343)
</TABLE>

     FINANCIAL INFORMATION.  Borrower's financial statements previously
     furnished to Lender are and were complete and correct, and were prepared in
     accordance with generally accepted accounting principles, and fairly
     represent Borrower's financial condition as of the date or date thereof. To
     the best of Borrower's knowledge, Borrower has no contingent obligations or
     liabilities that were not disclosed or reserved against in Borrower's
     financial statements or in the notes thereto. Since the dates of such
     financial statements, there has been no material adverse change in
     Borrower's financial condition or business.

     PROPERTIES.  Except as contemplated by this Agreement or as previously
     disclosed in Borrower's financial statements or in writing to Lender and as
     accepted by Lender, and except for property tax liens for taxes not
     presently due and payable. Borrower owns and has good title to all of
     Borrower's properties free and clear of all Security Interests, and has not
     executed any security documents or financing statements relating to such
     properties. All of Borrower's properties are titled in Borrower's legal
     name, and Borrower has not used, or filed a financing statement under, any
     other name for at least the last five (5) years.

     LITIGATION.  There are no suits or proceedings pending, or to the knowledge
     of Borrower, threatened against or affecting Borrower or its assets, before
     any court or by any governmental agency, other than those previously
     disclosed to Lender in writing, which, if adversely determined, may have a
     material adverse effect on Borrower's financial condition or business.
<PAGE>   13
05-11-2001          LIMITED LIABILITY COMPANY BORROWING AGREEMENT           Page
Loan No 0001301                   (Continued)
===============================================================================

     LOCATION OF BORROWER'S OFFICES AND RECORDS. The chief place of business of
     Borrower and the office or offices where Borrower keeps its records
     concerning the Collateral is located at 401 WHITNEY AVENUE SUITE 400,
     GRETNA, LA 70056-2503.

     TAXES. To the best of Borrower's knowledge, all tax returns and reports of
     Borrower that are or were required to be filed, have been filed, and all
     taxes, assessments and other governmental charges have been paid in full,
     except those presently being or to be contested by Borrower in good faith
     in the ordinary course of business and for which adequate reserves have
     been provided.

     INFORMATION. All information heretofore or contemporaneously herewith
     furnished by Borrower to Lender for the purposes of or in connection with
     this Agreement or any transaction contemplated hereby is, and all
     information hereafter furnished by or on behalf of Borrower to Lender will
     be, true and accurate in every material respect on the date as of which
     such information is dated or certified; and none of such information is or
     will be incomplete by omitting to state any material fact necessary to make
     such information not misleading.

     SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Borrower understands and agrees
     that Lender is and will continue to rely upon the above representations and
     warranties in the course of its dealings with Borrower. Borrower further
     agrees that the foregoing representations and warranties shall be
     continuing in nature and shall remain in full force and effect until such
     time as this Agreement is canceled or terminated.

AFFIRMATIVE COVENANTS. Borrower covenants and agrees that, so long as this
Agreement remains in effect, Borrower will:

     GOOD STANDING. Maintain its good standing status as a Louisiana limited
     liability company and remain qualified in each additional jurisdiction
     where the conduct of Borrower's business requires such qualification.

     OPERATIONS. Conduct its applicable federal, state and municipal laws,
     ordinances, rules and regulations respecting its properties, businesses and
     operations.

     TITLE OF ASSETS AND PROPERTY. Maintain good and marketable title to all of
     its assets and properties.

     INSPECTION. Permit employees or agents of Lender at any reasonable time to
     inspect its properties and to examine its books, accounts, records and to
     make copies and memoranda thereof.

     LITIGATION. Promptly inform Lender in writing of (a) any material adverse
     change in its financial condition, and (b) all litigation and claims and
     all threatened litigation and claims affecting Borrower or of such
     Guarantor.

     OTHER EVENTS. Promptly notify Lender in writing of (a) the addition of any
     new Members of Borrower, (b) the death, interdiction, withdrawal,
     expulsion, bankruptcy, or dissolution of any Member or the occurrence of
     any other event which may terminate the continued membership of any Member,
     (c) the expression of any intent or desire on the part of any Member or
     Members to dissolve or liquidate Borrower, and (d) the occurrence of any
     event specified in Borrower's Articles or in Borrower's Operating Agreement
     that may result in Borrower's dissolution or liquidation.

     FINANCIAL INFORMATION. Furnish Lender with, such financial statements,
     reports and other pertinent information as Lender may reasonably request
     from time to time. All such financial statements and reports required to be
     furnished under this Agreement shall be prepared in accordance with
     generally accepted accounting principles.

     INSURANCE. Maintain fire and other risk insurance, public liability
     insurance, and such other insurance as Lender may require with respect to
     Borrower's properties and operations. In form, amounts, coverages and with
     insurance companies reasonably acceptable to Lender, Borrower, upon request
     of Lender, will deliver to Lender from time to time the policies or
     certificates of insurance in form satisfactory to Lender, including
     stipulations that coverages will not be canceled or diminished without at
     least thirty (30) days' prior written notice to Lender. In connection with
     all policies covering assets in which Lender holds or is offered a Security
     Interest, Borrower will provide Lender with such lender's loss payable or
     other endorsements as Lender may require.

     TAXES, CHARGES AND LIENS. Pay and discharge when due all of its
     indebtedness and obligations, including without limitation all assessments,
     taxes, governmental charges, levies and liens, of every kind and nature,
     imposed upon Borrower or its properties, income, or profits, prior to the
     date on which penalties would attach, and all lawful claims that, if
     unpaid, might become a lien or charge upon any of Borrower's properties,
     income, or profits. Provided however, Borrower will not be required to pay
     and discharge any such assessment, tax, charge, levy, lien or claim so long
     as (a) the legality of the same shall be contested in good faith by
     appropriate proceedings, and (b) Borrower shall have established on its
     books adequate reserves with respect to such contested assessment, tax,
     charge, levy, lien, or claim in accordance with generally accepted
     accounting practices. Borrower, upon demand of Lender, will furnish to
     Lender evidence of payment of the assessments, taxes, charges, levies,
     liens and claims and will authorize the appropriate governmental official
     to deliver against Borrower's properties, income, or profits.

     PERFORMANCE. Perform and comply with all terms, conditions, and provisions
     set forth in this Agreement and in all other instruments and agreements
     between Borrower and Lender in a timely manner, and promptly notify Lender
     if Borrower learns of the occurrence of any event which constitutes an
     Event of Default under this Agreement.

     ADDITIONAL ASSURANCES. Make, execute and deliver to Lender such promissory
     notes, mortgages, deeds of trust, security agreements, financing
     statements, instruments, documents and other agreements as Lender and its
     attorneys may reasonably request to evidence and secure indebtedness and to
     perfect all Security Interests.

     COMPLIANCE CERTIFICATE. Upon request by Lender and from time to time,
     Borrower will provide Lender with a certificate executed by an affirmative
     and negative covenants set forth in this Agreement are true and correct as
     of the date of the certificate, and further certifying that as of the date
     of the certificate no Event of Default exists under this Agreement or under
     any Related Document.

NEGATIVE COVENANTS. Borrower covenants and agrees that, so long as this
Agreement remains in effect, Borrower will not without prior written notice to
and without having first having obtained the prior written consent of Lender:

     AMENDMENTS TO ARTICLES OR OPERATING AGREEMENT. Amend its Articles or
     Operating Agreement (a) to limit or restrict the permissible activities in
     which Borrower may engage, or (b) to withdraw the authority of or to limit
     or restrict the authority of Borrower's Authorized Representatives
     (including Borrower's Managers) to deal and contract with Lender and to
     bind and obligate Borrower.

     CONTINUITY OF OPERATIONS. (a) Engage in any business activities
     substantially different from those in which Borrower is presently engaged,
     or (b) merge or consolidate with any other entity.

     ACQUISITIONS AND GUARANTEES. (a) Purchase or acquire any interest in any
     other enterprise or entity, or (b) incur any obligation as a surety or
     guarantor other than in the ordinary course of business.

     SALE OR ENCUMBRANCE OF ASSETS. (a) Sell, assign and transfer all or
     substantially all of Borrower's properties and assets, or (b) sell with
     recourse any of Borrower's accounts, except to Lender.

     WITHDRAWAL OF MEMBERS. Permit any Member to withdraw from the Borrower and
     to receive any type of withdraw distribution.

     DISTRIBUTIONS. Pay any interim distribution in cash or other assets to a
     Member or Members of Borrower.

<PAGE>   14

05-11-2001       LIMITED LIABILITY COMPANY BORROWING AGREEMENT            PAGE 4
Loan No 0001301                   (Continued)



    WAIVER OR COMPROMISE OF RIGHTS AGAINST MEMBERS. Waive, compromise or forgo
    any rights that Borrower may have against any Member for unpaid capital
    contributions or any other obligation owed to Borrower.

    NON-COMPLIANCE. None of the above actions on the part of Borrower (including
    without limitation, any amendment to Borrower's Articles or Operating
    Agreement) shall be effective as against Lender unless and until: (a)
    Borrower shall have notified Lender in writing, and (b) Lender shall have
    expressly agreed to such actions in writing. Specifically, any distribution
    by Borrower in violation of this Agreement shall be considered as a
    "wrongful distribution" for purposes of applicable law.

OBLIGATIONS OF MEMBERS. So long as this Agreement remains in effect, each and
every present and future Member of Borrower agrees and covenants as follows:

NO WITHDRAWAL. Not to withdraw as a Member of Borrower and to obtain a
withdrawal distribution without first notifying Lender in writing and obtaining
Lender's prior written consent (which Lender shall have the unrestricted right
to refuse).

COMPLIANCE. To take whatever steps may be necessary and proper to insure that
Borrower and each other Member complies with the terms, conditions and covenants
of this Agreement.

SECURITY INTEREST GRANTED BY MEMBERS. Borrower and each Member additionally
agree as follows:

    MEMBERSHIP INTERESTS. Notwithstanding any provision of Borrower's Articles
    or Operating Agreement to the contrary, each member shall have the
    unrestricted right, power and authority to grant a Security Interest in
    favor of Lender as affecting his Membership Interest in Borrower.

    REDEMPTIVE RIGHTS. Should Lender acquire the Membership Interest of any
    Member as a result of a default under a loan, then Lender shall have the
    right, without the necessity of first obtaining any type of judgment against
    such a Member, to redeem the defaulting Member's Membership Interest for the
    then value thereof, which sum shall be paid by Borrower immediately on
    demand by Lender to be applied against the Member's loan obligation.

EVENTS OF DEFAULT. The following actions or inactions or both shall constitute
Events of Default under this Agreement:

    DEFAULT UNDER THE INDEBTEDNESS. Should Borrower default in the payment of
    principal or interest under any of the Indebtedness.

    DEFAULT UNDER THIS AGREEMENT. Should Grantor violate, or fail to comply
    fully with any of the terms and conditions of, or default under this
    Agreement.

    OTHER DEFAULTS IN FAVOR OF LENDER. Should Borrower or any Guarantor default
    under any other loan, extension of credit, security agreement, or obligation
    in favor of Lender.

    DEFAULT IN FAVOR OF THIRD PARTIES. Should Borrower or any Guarantor default
    under any loan, extension of credit, security agreement, purchase or sales
    agreement, or any other agreement, in favor of any other creditor or person
    that may materially affect any of Grantor's property, or Grantor's or any
    Guarantor's ability to perform their respective obligations under this
    Agreement, or any Related Document, or pertaining to the Indebtedness.

    INSOLVENCY. Should the suspension, failure or insolvency, however evidenced,
    of Borrower or any Guarantor occur or exist.

    READJUSTMENT OF INDEBTEDNESS. Should proceedings for readjustment of
    indebtedness, reorganization, composition or extension under any insolvency
    law be brought by or against Borrower or any Guarantor.

    ASSIGNMENT FOR BENEFIT OF CREDITORS. Should Borrower or any Guarantor file
    proceedings for a respite or make a general assignment for the benefit of
    creditors.

    RECEIVERSHIP. Should a receiver of all or any part of Borrower's property,
    or the property of any Guarantor, be applied for or appointed.

    DISSOLUTION PROCEEDINGS. Should proceedings for the dissolution or
    appointment of a liquidator of Borrower or any Guarantor be commenced.

    FALSE STATEMENTS. Should any representation or warranty of Borrower or any
    Guarantor made in connection with the Indebtedness prove to be incorrect or
    misleading in any respect.

    INSECURITY. Should Lender deem itself to be insecure with regard to
    repayment of the indebtedness.

DEPOSIT ACCOUNTS. As collateral security for repayment of Borrower's Note and
all renewals and extensions, as well as to secure any and all other loans,
notes, indebtedness and obligations that Borrower (or any of them) may now and
in the future owe to Lender or incur in Lender's favor, whether direct or
indirect, absolute or contingent, due or to become due, of any nature and kind
whatsoever (with the exception of any Borrower may now and in the future have on
deposit with Lender or in certificates of deposit or other deposit accounts as
to which Borrower is an account holder (with the exception of IRA, pension, and
other tax-deferred deposits). Borrower further agrees that Lender may at any
time apply any funds that Borrower may have on deposit with Lender or in
certificates of deposit or other deposit accounts as to which Borrower is an
account holder against the unpaid balance of Borrower's Note and any and all
other present and future indebtedness and obligations that Borrower (or any of
them) may then owe to Lender, in principal, interest, fees, costs, expenses, and
attorneys' fees.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement:

    AMENDMENTS. This Agreement, together with any Related Documents, constitutes
    the entire understanding and agreement of the parties as to the matters set
    forth in this Agreement. No alteration of or amendment to this Agreement
    shall be effective unless given in writing and signed by the party or
    parties sought to be charged or bound by the alteration or amendment.

    APPLICABLE LAW. This Agreement has been delivered to Lender and accepted by
    Lender in the State of Louisiana. Lender and Borrower hereby waive the right
    to any jury trial in any action, proceeding, or counterclaim brought by
    either Lender or Borrower against the other. Subject to the provisions on
    arbitration, this Agreement shall be governed by and construed in accordance
    with the laws of the State of Louisiana.

    ARBITRATION. Lender and Borrower agree that all disputes, claims and
    controversies between them, whether individual, joint, or class in nature,
    arising from this Agreement or otherwise, including without limitation
    contract and tort disputes, shall be arbitrated pursuant to the Rules of the
    American Arbitration Association, upon request of either party. No act to
    take or dispose of or foreclose upon any Collateral shall constitute a
    waiver of this arbitration agreement or be prohibited by this arbitration
    agreement. This includes, without limitation, obtaining injunctive relief or
    a temporary restraining order; invoking a power of sale under any deed of
    trust or mortgage; obtaining a writ of attachment or imposition of a
    receiver; or exercising any rights relating to personal property, including
    taking or disposing of such property with or without judicial process
    pursuant to Louisiana Commercial Laws (Ls. R.S. 10: 9-101, et seq.). Any
    disputes, claims, or controversies concerning the lawfulness or
    reasonableness of any act, or exercise of any right, concerning any
    Collateral, including any claim to rescind, reform, or otherwise modify any
    agreement relating to the Collateral, shall also be arbitrated, provided
    however that no
<PAGE>   15
05-11-2001       LIMITED LIABILITY COMPANY BORROWING AGREEMENT              PAGE
LOAN NO 0001301                   (CONTINUED)

================================================================================

     arbitrator shall have the right or the power to enjoin or restrain any act
     of any party. Judgment upon any award rendered by any arbitrator may be
     entered in any court having jurisdiction. Nothing in this Agreement shall
     prelude any party from seeking equitable relief from a court of competent
     jurisdiction. The statute of limitations, estoppel, waiver, laches, and
     similar doctrines which may otherwise be applicable in an action brought by
     a party shall be applicable in any arbitration proceeding, and the
     commencement of an arbitration proceeding shall be deemed the commencement
     of an action for these purposes. The Federal Arbitration Act shall apply to
     the construction, interpretation, and enforcement of this arbitration
     provision.

     CAPTION HEADINGS. Caption headings in this Agreement are for convenience
     purposes only and are not to be used to interpret or define the provisions
     of this Agreement.

     CONSENT TO LOAN PARTICIPATION. Borrower agrees and consents to Lender's
     sale or transfer, whether now or later, of one or more participation
     interests in the Loans to one or more purchasers, whether related or
     unrelated to Lender. Lender may provide, without any limitation whatsoever,
     to any one or more purchasers, or potential purchasers, any information or
     knowledge Lender may have about Borrower or about any other matter relating
     to the Loan, and Borrower hereby waives any rights to privacy it may have
     with respect to such matters. Borrower additionally waives any and all
     notices of sale of participation interests, as well as all notices of any
     repurchase of such participation interests. Borrower also agrees that the
     purchasers of any such participation interests will be considered as the
     absolute owners of such interests in the Loans and will have all the rights
     granted under the participation agreement or agreements governing the sale
     of such participation interests. Borrower further waives all rights of
     offset or counterclaim that it may have now or later against Lender or
     against any purchaser of such a participation interest and unconditionally
     agrees that either Lender or such purchaser may enforce Borrower's
     obligation under the Loans irrespective of the failure or insolvency of any
     holder of any interest in the Loans. Borrower further agrees that the
     purchaser of any such participation interests may enforce its interests
     irrespective of any personal claims or defenses that Borrower may have
     against Lender.

     COSTS AND EXPENSES. Borrower agrees to pay upon demand all of Lender's
     expenses, including without limitation attorneys' fees, incurred in
     connection with the preparation, execution, enforcement, modification and
     collection of this Agreement or in connection with the Loans made pursuant
     to this Agreement. Lender may pay someone else to help collect the Loans
     and to enforce this Agreement, and Borrower will pay that amount. This
     includes, subject to any limits under applicable law, Lender's attorneys'
     fees and Lender's legal expenses whether or not there is a lawsuit,
     including attorneys' fees for bankruptcy proceedings (including efforts to
     modify or vacate any automatic stay or injunction), appeals, and any
     anticipated post-judgment collection services. Borrower also will pay any
     court costs, in addition to any other sums provided by law.

     NOTICES. To give Borrower or a Member any notice required under this
     Agreement, Lender may hand deliver or mail such notice to Borrower or such
     Member. Lender will deliver or mail any notice to Borrower or Member at any
     address which Borrower or Member may have given Lender by written notice as
     provided in this paragraph. In the event that there is more than one
     Borrower under this Agreement, notice to a single Borrower or Member shall
     be considered as notice to all Borrowers or Members. To give Lender any
     notice under this Agreement, notice to a single Borrower or Member shall be
     considered as notice to all Borrowers or Members. To give Lender any notice
     under this Agreement. Borrower or Member shall mail the notice to Lender by
     registered or certified mail at the address specified in this Agreement, or
     at any other address that Lender may have given to Borrower or Member by
     written notice as provided in this paragraph. All notices required or
     permitted under this Agreement must be in writing and will be considered as
     given on the day it is delivered by hand or deposited in the U.S. Mail, by
     registered or certified mail to the address specified in this Agreement.

     SEVERABILITY. If a court of competent jurisdiction finds any provision of
     this Agreement to be invalid or unenforceable as to any person or
     circumstance, such finding shall not render that provision invalid or
     unenforceable as to any other persons or circumstances. If feasible, any
     such offending provision shall be deemed to be modified to be within the
     limits of enforceability or validity; however, if the offending provision
     cannot be so modified, it shall be stricken and all other provisions of
     this Agreement in all other respects shall remain valid and enforceable.

     SOLE DISCRETION OF LENDER. Whenever Lender's consent or approval is
     required under this Agreement, the decision as to whether or not to consent
     or approve shall be in the sole and exclusive discretion of Lender and
     Lender's decision shall be final and conclusive.

     SUCCESSORS AND ASSIGNS. All covenants and agreements contained by or on
     behalf of Borrower shall bind its successors and assigns and shall inure to
     the benefit of Lender, its successors and assigns. Borrower shall not,
     however, have the right to assign its rights under this Agreement or any
     interest therein, without the prior written consent of Lender.

     SURVIVAL. All warranties, representations, and covenants made by Borrower
     in this Agreement or in any certificate or other instrument delivered by
     Borrower to Lender under this Agreement shall be considered to have been
     relied upon by Lender and will survive the making of the Loan and delivery
     to Lender of the Related Documents, regardless of any investigation made by
     Lender or on Lender's behalf.

     WAIVER. Lender shall not be deemed to have waived any rights under this
     Agreement unless such waiver is given in writing and signed by Lender. No
     delay or omission on the part of Lender in exercising any right shall
     operate as a waiver of such right or any other right. A waiver by Lender of
     a provision of this Agreement shall not prejudice or constitute a waiver of
     Lender's right otherwise to demand strict compliance with that provision or
     any other provision of this Agreement. No prior waiver by Lender, nor any
     course of dealing between Lender and Borrower, or between Lender and any
     Grantor, shall constitute a waiver of any of Lender's rights or of any
     obligations of Borrower or of any Grantor as to any future transactions.
     Whenever the consent of Lender is required under this Agreement, the
     granting of such consent by Lender in any instance shall not constitute
     continuing consent in subsequent instances where such consent is required,
     and in all cases such consent may be granted or withheld in the sole
     discretion of Lender.


<PAGE>   16
05-11-2001        LIMITED LIABILITY COMPANY BORROWING AGREEMENT           Page 6
Loan No 0001301                  (Continued)
================================================================================

BORROWER AND EACH MEMBER SIGNING BELOW ACKNOWLEDGE HAVING READ ALL THE
PROVISIONS OF THIS AGREEMENT, AND BORROWER AND EACH MEMBER AGREE TO ITS TERMS.
THIS AGREEMENT IS DATED AS OF MAY 11, 2001.

BORROWER:

TORCH OFFSHORE, L.L.C.

By: /s/ Lyle Stockstill
   ----------------------------------------------------------------------
   LYLE STOCKSTILL, CHAIRMAN, CEO (SSN:###-##-####), Manager


By: /s/ Lana Hingle Stockstill
   ----------------------------------------------------------------------
   LANA HINGLE STOCKSTILL (SSN:###-##-####), Manager


MEMBERS:


By: /s/ Lyle Stockstill
   ----------------------------------------------------------------------
   LYLE STOCKSTILL, CHAIRMAN, CEO (SSN:###-##-####), Managing Member

By: /s/ Lana Hingle Stockstill
   ----------------------------------------------------------------------
   LANA HINGLE STOCKSTILL (SSN:###-##-####), Managing Member


LENDER:

Regions Bank

By:
   ----------------------------------------------------------------------
   Authorized Officer

================================================================================





<PAGE>   17
                              [REGIONS BANK LOGO]

                     DISBURSEMENT REQUEST AND AUTHORIZATION

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
  PRINCIPAL        LOAN DATE      MATURITY      LOAN NO     CALL    COLLATERAL     ACCOUNT     OFFICER     INITIALS
<S>               <C>            <C>            <C>         <C>     <C>            <C>         <C>         <C>
$8,000,000.00     05-11-2001     11-12-2001     0001301     590        4635        5439329       L32
--------------------------------------------------------------------------------------------------------------------
References in the shaded area are for Lender's use only and do not limit the applicability of this document to any
particular loan or item.
--------------------------------------------------------------------------------------------------------------------

BORROWER:     TORCH OFFSHORE, L.L.C. (TIN: 72-1471586)           LENDER:     REGIONS BANK TIN: 63-0371391
              401 WHITNEY AVENUE SUITE 400                                   COMMERCIAL LENDING
              GRETNA, LA 70056-2503                                          301 ST. CHARLES AVENUE
                                                                             3RD FLOOR
                                                                             NEW ORLEANS, LA 70130
====================================================================================================================
</TABLE>

LOAN TYPE. This is a Variable Rate (3.000% over London Interbank Offered Rate
(LIBOR) for one (1) month contracts as published in the "Money Rates" column of
The Wall Street Journal on the last business day of each month, with an
effective date of the first calendar day of the following month (such effective
date for the initial index for this loan to further serve as the commencement
date of the initial rate change period identified below), making an initial
rate of 7.434%), Revolving Line of Credit Loan to a Limited Liability Company
for $8,000,000.00 due on November 12, 2001. This is a secured renewal of the
following described indebtedness: Renewal or refinance of the Promissory Note
to us dated September 12, 2000. This does not satisfy or in any way discharge
the existing debt under that note, nor does it release any security identified
in that note.

PRIMARY PURPOSE OF LOAN. The primary purpose of this loan is for:

     [ ]  Personal, Family, or Household Purposes or Personal Investment.
     [X]  Business (Including Real Estate Investment).

SPECIFIC PURPOSE. The specific purpose of this loan is: renew working capital
line of credit.

DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be
disbursed until all of Lender's conditions for making the loan have been
satisfied. Please disburse the loan proceeds of $8,000,000.00 as follows:

<TABLE>
<S>                                                                   <C>
          AMOUNT PAID TO BORROWER DIRECTLY:                                   $0.00
          UNDISBURSED FUNDS:                                          $2,694,951.07
          AMOUNT PAID TO OTHERS ON BORROWER'S BEHALF:                 $5,305,048.93
          Lender may retain a portion of certain of these amounts.
          $5,305,048.93 to Regions Bank Shaw Loan #543929-0002
                                                                      -------------
          NOTE PRINCIPAL:                                             $8,000,000.00
</TABLE>

CHARGES PAID IN CASH. Borrower has paid or will pay in cash as agreed the
following charges:

<TABLE>
<S>                                                                   <S>
          PREPAID FINANCE CHARGES PAID IN CASH:                          $12,813.00
               $100.00 Documentation Fee
               $12,713.00 Commitment Fee
                                                                      -------------
          TOTAL CHARGES PAID IN CASH:                                    $12,813.00
</TABLE>

AUTOMATIC PAYMENTS. Borrower hereby authorizes Lender automatically to deduct
from Borrower's account numbered 4105081239 the amount of any loan payment. If
the funds in the account are insufficient to cover any payment, Lender shall
not be obligated to advance funds to cover the payment. At any time and for any
reason, Borrower or Lender may voluntarily terminate Automatic Payments.

FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND
WARRANTS TO LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND
THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S FINANCIAL
CONDITION AS DISCLOSED IN BORROWER'S MOST RECENT FINANCIAL STATEMENT TO LENDER.
THIS AUTHORIZATION IS DATED MAY 11, 2001.

BORROWER:

TORCH OFFSHORE, L.L.C.


By: /s/ Lyle Stockstill
    ---------------------------------------------------
    LYLE STOCKSTILL, CHAIRMAN, CEO (SSN:###-##-####), Manager

By: /s/ Lana Hingle Stockstill
    ---------------------------------------------------
    Lana Hingle Stockstill (SSN:###-##-####), Manager

================================================================================
Simple, Variable Rate, Line of Credit.               LASER PRO, Reg. U.S. Pat. &
                                                     T.M. Off., Ver. 329a (C)
                                                     Concentrex 2001 All rights
                                                     reserved. ILA-120 E3.29
                                                     0001001.LNC2OVLI

<PAGE>   18
                              COMMERCIAL GUARANTY

<TABLE>
<CAPTION>
PRINCIPAL      LOAN DATE      MATURITY       LOAN NO        CALL      COLLATERAL     ACCOUNT      OFFICER        INITIALS
                                                            590       4635           5439329      L32
<S>            <C>            <C>            <C>            <C>       <C>            <C>          <C>            <C>
-------------------------------------------------------------------------------------------------------------------------
References in the shaded areas are for Lender's use only and do not limit the applicability of this document to any
particular loan or item.
-------------------------------------------------------------------------------------------------------------------------
</TABLE>

BORROWER: TORCH OFFSHORE, L.L.C.                LENDER: REGIONS BANK
(TIN: 72-1471586)                               TIN: 63-0371391
401 WHITNEY AVENUE SUITE 400                    COMMERCIAL LENDING
GRETNA, LA 70056-2503                           301 ST. CHARLES AVENUE
                                                3RD FLOOR
                                                NEW ORLEANS, LA 70130

GUARANTOR: LYLE STOCKSTILL, (SSN: ###-##-####)
401 WHITNEY AVENUE SUITE 400
GRETNA, LA 70056
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

AMOUNT OF GUARANTY. The amount of this Guaranty is Unlimited.

DEFINITIONS. The following terms shall have the following meanings when used in
this Agreement:

     AGREEMENT. The word "Agreement" means this Guaranty Agreement as this
     Agreement may be amended or modified from time to time.

     BORROWER. The word "Borrower" means individually, collectively and
     interchangeably TORCH OFFSHORE, L.L.C.

     GUARANTOR. The word "Guarantor" means individually, collectively and
     interchangeably LYLE STOCKSTILL, CHAIRMAN, CEO (SSN: ###-##-####) and all
     other persons guaranteeing payment and satisfaction of Borrower's
     Indebtedness as hereinafter defined.

     INDEBTEDNESS. The word "Indebtedness" means individually, collectively,
     interchangeably and without limitation any and all present and future
     loans, loan advances, extensions of credit, obligations and/or liabilities
     that Borrower may now and/or in the future owe to and/or incur in favor of
     Lender, whether direct or indirect, or by way of assignment or purchase of
     a participation interest, and whether absolute or contingent, voluntary or
     involuntary, determined or undetermined, liquidated or unliquidated, due or
     to become due, secured or unsecured, and whether Borrower may be liable
     individually, jointly or solidarily with others, whether primarily or
     secondarily, or as a guarantor or otherwise, and whether now existing or
     hereafter arising, of every nature and kind whatsoever, in principal,
     interest, costs, expenses and attorneys' fees and other fees and charges,
     including without limitation Borrower's indebtedness and obligations under
     a certain promissory note in favor of Lender dated May 11, 2001 in the
     fixed principal amount of U.S. $8,000,000.00. In addition, all interest
     thereon, costs, expenses, attorneys' fees and other fees and charges
     related thereto under Borrower's Indebtedness shall be fully guaranteed
     hereunder.

     LENDER. The word "Lender" means Regions Bank. Commercial Lending TIN:
     63-0371391, its successors and assigns, and any subsequent holder or
     holders of Borrower's Indebtedness.

GUARANTEE OF BORROWER'S INDEBTEDNESS. Guarantor hereby absolutely and
unconditionally agrees to, and by these presents does hereby, guarantee the
prompt and punctual payment, performance and satisfaction of any and all of
Borrower's present and future indebtedness in favor of Lender.

CONTINUING GUARANTY. THIS IS A CONTINUING GUARANTY AGREEMENT UNDER WHICH
GUARANTOR AGREES TO GUARANTEE PAYMENT OF BORROWER'S PRESENT AND FUTURE
INDEBTEDNESS IN FAVOR OF LENDER ON A CONTINUING BASIS. Guarantor's obligations
and liability under this Agreement shall be open and continuous in effect.
Guarantor intends to and does hereby guarantee at all times the prompt and
punctual payment, performance and satisfaction of all of Borrower's present and
future indebtedness in favor of Lender. Accordingly, any payments made on
Borrower's Indebtedness will not discharge or diminish the obligations and
liability of Guarantor under this Agreement for any remaining and succeeding
Indebtedness of Borrower in favor of Lender. To the extent that Guarantor is or
may become a Member/Owner of Borrower, Guarantor agrees that, notwithstanding
the provisions of La. R.S. 12:1320, Guarantor shall be liable under this
Agreement for Borrower's Indebtedness in favor of Lender.

JOINT, SEVERAL AND SOLIDARY LIABILITY. Guarantor's obligations and liability
under this Agreement shall be on a "solidary" or "joint and several" basis along
with Borrower to the same degree and extent as if Guarantor had been and/or will
be a co-borrower, co-principal obligor and/or co-maker of Borrower's
Indebtedness. In the event that there is more than one Guarantor under this
Agreement, or in the event that there are other guarantors, endorsers or
sureties of all or any portion of Borrower's Indebtedness, Guarantor's
obligations and liability hereunder shall further be on a "solidary" or "joint
and several" basis along with such other guarantors, endorsers and/or sureties.

DURATION OF GUARANTY. This Agreement and Guarantor's obligations and liability
hereunder shall remain in full force and effect until such time as this
Agreement may be cancelled or otherwise terminated by Lender under a written
cancellation instrument in favor of Guarantor (subject to the automatic
reinstatement provisions hereinbelow). It is anticipated that fluctuations may
occur in the aggregate amount of Borrower's Indebtedness guaranteed under this
Agreement and it is specifically acknowledged and agreed to by Guarantor that
reductions in the amount of Borrower's Indebtedness, even to zero ($0.00)
dollars, prior to Lender's written cancellation of this Agreement, shall not
constitute or give rise to a termination of this Agreement.

CANCELLATION OF AGREEMENT; EFFECT. Unless otherwise indicated under such a
written cancellation instrument, Lender's agreement to terminate or otherwise
cancel this Agreement shall effect only, and shall be expressly limited to,
Guarantor's continuing obligations and liability to guarantee Borrower's
Indebtedness incurred, originated and/or extended (without prior commitment)
after the date of such a written cancellation instrument: with Guarantor
remaining fully obligated and liable under this Agreement for any and all of
Borrower's Indebtedness incurred, originated, extended, or committed to prior to
the date of such a written cancellation instrument. Nothing under this Agreement
or under any other agreement or understanding by and between Guarantor and
Lender, shall in any way obligate, or be construed to obligate, Lender to agree
to the subsequent termination or cancellation of Guarantor's obligations and
liability hereunder; it being fully understood and agreed to by Guarantor that
Lender has and intends to continue to rely on Guarantor's assets, income and
financial resources in extending credit and other Indebtedness to and in favor
of Borrower, and that to release Guarantor from Guarantor's continuing
obligations and liabilities under this Agreement would so prejudice Lender that
Lender may, within its sole and uncontrolled discretion and judgment, refuse to
release Guarantor from any of its continuing obligations and liability under
this Agreement for any reason whatsoever as long as any of Borrower's
Indebtedness remains unpaid and outstanding, or otherwise.

DEFAULT. Should any event of default occur or exist under any of Borrower's
Indebtedness in favor of Lender, Guarantor unconditionally and absolutely agrees
to pay Lender the then unpaid amount of Borrower's Indebtedness, in principal,
interest, costs, expenses, attorneys' fees and other fees and charges. Such
payment or payments shall be made at Lender's offices indicated above,
immediately following demand by Lender.

GUARANTOR'S WAIVERS. Guarantor hereby waives:

     (a) Notice of Lender's acceptance of this Agreement.

     (b) Presentment for payment of Borrower's Indebtedness, notice of dishonor
     and of nonpayment, notice of intention to accelerate, notice of
     acceleration, protest and notice of protest, collection or institution of
     any suit or other action by Lender in collection thereof, including any
     notice of default in payment thereof, or other notice to, or demand for
     payment thereof, on any party.

     (c) Any right to require Lender to notify Guarantor of any nonpayment
     relating to any collateral directly or indirectly securing Borrower's
     Indebtedness, or notice of any action or nonaction on the part of Borrower,
     Lender, or any other guarantor, surety or endorser of Borrower's
     Indebtedness, or notice of the creation of any new or additional
     Indebtedness subject to this Agreement.

     (d) Any rights to demand or require collateral security from the Borrower
     or any other person as provided under applicable Louisiana law or
     otherwise.

     (e) Any right to require Lender to notify Guarantor of the terms, time and
     place of any public or private sale of any collateral directly or
     indirectly securing Borrower's Indebtedness.

     (f) Any "one action" or "anti-deficiency" law or any other law which may
     prevent Lender from bringing any action, including a claim for deficiency,
     against Guarantor, before or after Lender's commencement or completion of
     any foreclosure action, or any action in lieu of foreclosure.

     (g) Any election of remedies by Lender that may destroy or impair
     Guarantor's subrogation rights or Guarantor's right to proceed for
     reimbursement against Borrower or any other guarantor, surety or endorser
     of Borrower's Indebtedness, including without limitation, any loss of
     rights Guarantor may suffer by reason of any law limiting, qualifying, or
     discharging Borrower's Indebtedness.

     (h) Any disability or other defense of Borrower, or any other guarantor,
     surety or endorser, or any other person, or by reason of the cessation from
     any cause whatsoever, other than payment in full of Borrower's
     Indebtedness.

     (i) Any statute of limitations or prescriptive period, if at the time an
     action or suit brought by Lender against Guarantor is commenced, there is
     any outstanding Indebtedness of Borrower to Lender which is barred by any
     applicable statute of limitations or prescriptive period.

<PAGE>   19
05-11-2001                    COMMERCIAL GUARANTY                         Page 2



Loan No 0001301                   (Continued)
================================================================================

Guarantor warrants and agrees that each of the waivers set forth above is made
with Guarantor's full knowledge of its significance and consequences, and that,
under the circumstances, such waivers are reasonable and not contrary to public
policy or law. If any such waiver is determined to be contrary to any applicable
law or public policy, such waiver shall be effective only to the extent
permitted by law.

GUARANTOR'S SUBORDINATION OF RIGHTS. In the event that Guarantor should for any
reason (a) advance or lend monies to Borrower, whether or not such funds are
used by Borrower to make payment(s) under Borrower's Indebtedness, and/or (b)
make any payment(s) to Lender or others for and on behalf of Borrower under
Borrower's Indebtedness, and/or (c) make any payment to Lender in total or
partial satisfaction of Guarantor's obligations and liabilities under this
Agreement, and/or (d) if any of Guarantor's property is used to pay or satisfy
any of Borrower's Indebtedness. Guarantor hereby agrees that any and all rights
that Guarantor may have or acquire to collect from or to be reimbursed by
Borrower (or from or by any other guarantor, endorser or surety of Borrower's
Indebtedness), whether Guarantor's rights of collection or reimbursement arise
by way of subrogation to the rights of Lender or otherwise, shall in all
respects, whether or not Borrower is presently or subsequently becomes
insolvent, be subordinate, inferior and junior to the rights of Lender to
collect and enforce payment, performance and satisfaction of Borrower's then
remaining Indebtedness, until such time as Borrower's Indebtedness is fully paid
and satisfied. In the event of Borrower's insolvency or consequent liquidation
of Borrower's assets, through bankruptcy, by an assignment for the benefit of
creditors, by voluntary liquidation, or otherwise, the assets of Borrower
applicable to the payment of claims of both Lender and Guarantor shall be paid
to Lender and shall be first applied by Lender to Borrower's then remaining
Indebtedness. Guarantor hereby assigns to Lender all claims which it may have or
acquire against Borrower or any assignee or trustee of Borrower in bankruptcy;
provided that, such assignment shall be effective only for the purpose of
assuring to Lender full payment of Borrower's Indebtedness guaranteed under this
Agreement.

If now or hereafter (a) Borrower shall be or become insolvent, and (b)
Borrower's Indebtedness shall not at all times until paid be fully secured by
collateral pledged by Borrower, Guarantor hereby forever waives and relinquishes
in favor of Lender and Borrower, and their respective successors, any claim or
right to payment Guarantor may now have or hereafter have or acquire against
Borrower, by subrogation or otherwise, so that at no time shall Guarantor be or
become a "creditor" of Borrower within the meaning of 11 U.S.C. section 547(b),
or any successor provision of the Federal bankruptcy laws.

GUARANTOR'S RECEIPT OF PAYMENTS. Guarantor further agrees to refrain from
attempting to collect and/or enforce any of Guarantor's collection and/or
reimbursement rights against Borrower for against any other guarantor, surety or
endorser of Borrower's Indebtedness), arising by way of subrogation or
otherwise, until such time as all of Borrower's then remaining Indebtedness in
favor of Lender is fully paid and satisfied. In the event that Guarantor should
for any reason whatsoever receive any payment(s) from Borrower (or any other
guarantor, surety or endorser of Borrower's Indebtedness) that Borrower (or such
a third party) may owe to Guarantor for any of the reasons stated above,
Guarantor agrees to accept such payment(s) in trust for and on behalf of Lender,
advising Borrower (or the third party payee) of such fact. Guarantor further
unconditionally agrees to immediately deliver such funds to Lender, with such
funds being held by Guarantor over any interim period, in trust for Lender. In
the event that Guarantor should for any reason whatsoever receive any such funds
from Borrower (or any third party), and Guarantor should deposit such funds in
one or more of Guarantor's deposit accounts, no matter where located, Lender
shall have the right to attach any and all of Guarantor's deposit accounts in
which such funds were deposited, whether or not such funds were commingled with
other monies of Guarantor, and whether or not such funds then remain on deposit
in such an account or accounts. To this end and to secure Guarantor's
obligations under this Agreement, Guarantor collaterally assigns and pledges to
Lender, and grants to Lender a continuing security interest in, any and all of
Guarantor's present and future rights, title and interest in and to all monies
that Guarantor may now and/or in the future maintain on deposit with banks,
savings and loan associations and other entities (other than tax deferred
accounts with Lender), in which Guarantor may at any time deposit any such funds
that may be received from Borrower (or any other guarantor, endorser or surety
of Borrower's Indebtedness) in favor of Lender.

DEPOSIT ACCOUNTS. As collateral security for repayment of Guarantor's
obligations hereunder and under any additional guaranties previously granted or
to be granted by Guarantor in the future, and additionally as collateral
security for any present and future indebtedness of Guarantor in favor of Lender
(with the exception of any indebtedness under a consumer credit card account),
Guarantor is granting Lender a continuing security interest in any and all funds
that Guarantor may now and in the future have on deposit with Lender or in
certificates of deposit or other deposit accounts as to which Guarantor is an
account holder (with the exception of IRA, pension, and other tax-deferred
deposits). Guarantor further agrees that Lender may at any time apply any funds
that Guarantor may have on deposit with Lender or in certificates of deposit or
other deposit accounts as to which Guarantor is an account holder against the
unpaid balance of any and all other present and future obligations and
indebtedness of Guarantor to Lender, in principal, interest, fees, costs,
expenses, and attorneys' fees.

ADDITIONAL COVENANTS. Guarantor agrees that Lender may, at its sole option, at
any time, and from time to time, without the consent of or notice to Guarantor,
or any of them, or to any other party, and without incurring any responsibility
to Guarantor or to any other party, and without impairing or releasing any of
Guarantor's obligations or liabilities under this Agreement:

     (a) Make additional secured and/or unsecured loans to Borrower.

     (b) Discharge, release or agree not to sue any party (including, but not
     limited to, Borrower or any other guarantor, surety, or endorser of
     Borrower's Indebtedness), who is or may be liable to Lender for any of
     Borrower's Indebtedness.

     (c) Sell, exchange, release, surrender, realize upon, or otherwise deal
     with, in any manner and in any order, any collateral directly or indirectly
     securing repayment of any of Borrower's Indebtedness.

     (d) Alter, renew, extend, accelerate, or otherwise change the manner,
     place, terms and/or times of payment or other terms of Borrower's
     Indebtedness, or any part thereof, including any increase or decrease in
     the rate or rates of interest on any of Borrower's Indebtedness.

     (e) Settle or compromise any of Borrower's Indebtedness.

     (f) Subordinate and/or agree to subordinate the payment of all or any part
     of Borrower's Indebtedness, or Lender's security rights in any collateral
     directly or indirectly securing any such Indebtedness, to the payment
     and/or security rights of any other present and/or future creditors of
     Borrower.

     (g) Apply any payments and/or proceeds to any of Borrower's Indebtedness in
     such priority or with such preferences as Lender may determine in its sole
     discretion, regardless of which of Borrower's Indebtedness then remains
     unpaid.

     (h) Take or accept any other collateral security or guaranty for any or all
     of Borrower's Indebtedness.

     (i) Enter into, deliver, modify, amend, or waive compliance with, any
     instrument or arrangement evidencing, securing or otherwise affecting, all
     or any part of Borrower's Indebtedness.

NO IMPAIRMENT OF GUARANTOR'S OBLIGATIONS. No course of dealing between Lender
and Borrower (or any other guarantor, surety or endorser of Borrower's
Indebtedness), nor any failure or delay on the part of Lender to exercise any of
Lender's rights and remedies under this Agreement or any other agreement or
agreements by and between Lender and Borrower (or any other guarantor, surety or
endorser), shall have the effect of impairing or releasing Guarantor's
obligations and liabilities to Lender, or of waiving any of Lender's rights and
remedies under this Agreement or otherwise. Any partial exercise of any rights
and remedies granted to Lender shall furthermore not constitute a waiver of any
of Lender's other rights and remedies; it being Guarantor's intent and agreement
that Lender's rights and remedies shall be cumulative in nature. Guarantor
further agrees that, should Borrower default under any of its Indebtedness, any
waiver or forbearance on the part of Lender to pursue Lender's available rights
and remedies shall be binding upon Lender only to the extent that Lender
specifically agrees to such waiver or forbearance in writing. A waiver or
forbearance on the part of Lender as to one event of default shall not
constitute a waiver or forbearance as to any other default.

NO RELEASE OF GUARANTOR. Guarantor's obligations and liabilities under this
Agreement shall not be released, impaired, reduced, or otherwise affected by,
and shall continue in full force and effect notwithstanding the occurrence of
any event, including without limitation any one or more of the following events:

     (a) The death, insolvency, bankruptcy, arrangement, adjustment,
     composition, liquidation, disability, dissolution, or lack of authority
     (whether corporate, partnership or trust) of Borrower (or any person
     acting on Borrower's behalf), or of any other guarantor, surety or
     endorser of Borrower's Indebtedness.

     (b) Any payment by Borrower, or any other party, to Lender that is held to
     constitute a preferential transfer or a fraudulent conveyance under any
     applicable law, or any such amounts or payment which, for any reason,
     Lender is required to refund or repay to Borrower or to any other person.

     (c) Any dissolution of Borrower, or any sale, lease or transfer of all or
     any part of Borrowers assets.

     (d) Any failure of Lender to notify Guarantor of the making of additional
     loans or other extensions of credit in reliance on this Agreement.

AUTOMATIC REINSTATEMENT. This Agreement and Guarantor's obligations and
liabilities hereunder shall continue to be effective, and/or shall automatically
and retroactively be reinstated, if a release or discharge has occurred, or if
at any time, any payment or part thereof to Lender with respect to any of
Borrower's Indebtedness, is rescinded or must otherwise be restored by Lender
pursuant to any insolvency, bankruptcy, reorganization, receivership, or any
other debt relief granted to Borrower or to any other party to Borrower's
Indebtedness or any such security therefor. In the event that Lender must
rescind or restore any payment received in total or partial satisfaction of
Borrower's Indebtedness, any prior release or discharge from the terms of this
Agreement given to Guarantor shall be without effect, and this Agreement and
Guarantor's

<PAGE>   20
05-11-2001                      COMMERCIAL GUARANTY                       Page 3
Loan No 0001301                     (Continued)
================================================================================
obligations and liabilities hereunder shall automatically and retroactively be
renewed and/or reinstated and shall remain in full force and effect to the same
degree and extent as if such a release or discharge had never been granted. It
is the intention of Lender and Guarantor that Guarantor's obligations and
liabilities hereunder shall not be discharged except by Guarantor's full and
complete performance and satisfaction of such obligations and liabilities; and
then only to the extent of such performance.

REPRESENTATIONS AND WARRANTIES BY GUARANTOR. Guarantor represents and warrants
that:

     (a) Guarantor has the lawful power to own its properties and to engage in
     its business as presently conducted.

     (b) Guarantor's guaranty of Borrower's Indebtedness and Guarantor's
     execution, delivery and performance of this Agreement are not in violation
     of any laws and will not result in a default under any contract, agreement,
     or instrument to which Guarantor is a party, or by which Guarantor or its
     property may be bound.

     (c) Guarantor has agreed and consented to execute this Agreement and to
     guarantee Borrower's Indebtedness in favor of Lender, at Borrower's request
     and not at the request of Lender.

     (d) Guarantor will receive and/or has received a direct or indirect
     material benefit from the transactions contemplated herein and/or arising
     out of Borrower's Indebtedness.

     (e) This Agreement, when executed and delivered to Lender, will constitute
     a valid, legal and binding obligation of Guarantor, enforceable in
     accordance with its terms.

     (f) Guarantor has established adequate means of obtaining information from
     Borrower on a continuing basis regarding Borrower's financial condition.

     (g) Lender has made no representations to Guarantor as to the
     creditworthiness of Borrower.


ADDITIONAL OBLIGATIONS OF GUARANTOR. So long as this Agreement remains in
effect, Guarantor has not and will not, without Lender's prior written consent,
sell, lease, assign, pledge, hypothecate, encumber, transfer, or otherwise
dispose of all or substantially all of Guarantor's assets. Guarantor agrees to
keep adequately informed of any facts, events or circumstances which might in
any way affect Guarantor's risks under this Agreement. Guarantor further agrees
that Lender shall have no obligation to disclose to Guarantor any information or
material relating to Borrower or Borrower's Indebtedness.

ADDITIONAL DOCUMENTS: FINANCIAL STATEMENTS. Upon the reasonable request of
Lender, Guarantor will, at any time, and from time to time, execute and deliver
to Lender any and all such financial instruments and documents, and supply such
additional information, as may be necessary or advisable in the opinion of
Lender to obtain the full benefits of this Agreement. Guarantor further agrees
to provide Lender with such financial statements and other related information
at such frequencies and in such detail as Lender may reasonably request.

TRANSFER OF INDEBTEDNESS. This Agreement is for the benefit of Lender and for
such other person or persons as may from time to time become or be the holders
of all or any part of Borrower's Indebtedness. This Agreement shall be
transferrable and negotiable with the same force and effect and to the same
extent as Borrower's Indebtedness may be transferrable; it being understood and
agreed to by Guarantor that, upon any transfer or assignment of all or any part
of Borrower's Indebtedness; the holder of such Indebtedness shall have all of
the rights and remedies granted to Lender under this Agreement. Guarantor
further agrees that, upon any transfer of all or any portion of Borrower's
Indebtedness, Lender may transfer and deliver any and all collateral securing
repayment of such Indebtedness (including, but not limited to, any collateral
provided by Guarantor) to the transferee of such Indebtedness, and such
collateral shall secure any and all of Borrower's Indebtedness in favor of such
a transferee. Guarantor additionally agrees that, after any such transfer or
assignment has taken place, Lender shall be fully discharged from any and all
liability and responsibility to Borrower and Guarantor with respect to such
collateral, and the transferee thereafter shall be vested with all the powers
and rights with respect to such collateral.

CONSENT TO PARTICIPATION. Guarantor recognizes and agrees that Lender may, from
time to time, one or more times, transfer all or any part of Borrower's
Indebtedness through sales of participation interests in such Indebtedness to
one or more third party lenders. Guarantor specifically agrees and consents to
all such transfers and assignments, and Guarantor further waives any subsequent
notice of such transfers and assignments as may be provided under Louisiana law.
Guarantor additionally agrees that the purchaser of a participation interest in
Borrower's Indebtedness will be considered as the absolute owner of a percentage
interest of such Indebtedness and that such a purchaser will have all of the
rights granted under any participation agreement governing the sale of such a
participation interest. Guarantor waives any rights of offset that Guarantor may
have against Lender and/or any purchaser of such a participation interest, and
Guarantor unconditionally agrees that either Lender or such a purchaser may
enforce Guarantor's obligations and liabilities under this Agreement,
irrespective of the failure or insolvency of Lender or any such purchaser.

NOTICES. Any notice provided in this Agreement must be in writing and will be
considered as given on the day it is delivered by hand or deposited in the U.S.
mail, postage prepaid, addressed to the person to whom the notice is to be given
at the address shown above or at such other addresses as any party may designate
to the other in writing. If there is more than one Guarantor under this
Agreement, notice to any Guarantor shall constitute notice to all Guarantors.

ADDITIONAL GUARANTIES. Guarantor recognizes and agrees that Guarantor may have
previously granted, and may in the future grant, one or more additional
guaranties of Borrower's Indebtedness in favor of Lender. Should this occur, the
execution of this Agreement and any additional guaranties on the part of
Guarantor will not be construed as a cancellation of this Agreement or any of
Guarantor's additional guaranties; it being Guarantor's full intent and
agreement that all such guaranties of Borrower's Indebtedness in favor of Lender
shall remain in full force and effect and shall be cumulative in nature and
effect.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Guaranty:

     AMENDMENT. No amendment, modification, consent or waiver of any provision
     of this Agreement, and no consent to any departure by Guarantor therefrom,
     shall be effective unless the same shall be in writing signed by a duly
     authorized officer of Lender, and then shall be effective only as to the
     specific instance and for the specific purpose for which given.

     APPLICABLE LAW. This Guaranty has been delivered to Lender and accepted by
     Lender in the State of Louisiana. This Guaranty shall be governed by and
     construed in accordance with the laws of the State of Louisiana.

     CAPTION HEADINGS. Caption headings of the sections of this Agreement are
     for convenience purposes only and are not to be used to interpret or to
     define their provisions. In this Agreement, whenever the context so
     requires, the singular includes the plural and the plural also includes the
     singular.

     SEVERABILITY. If any provision of this Agreement is held to be illegal,
     invalid or unenforceable under present or future laws effective during the
     term hereof, such provision shall be fully severable. This Agreement shall
     be construed and enforceable as if the illegal, invalid or unenforceable
     provision had never comprised a part of it, and the remaining provisions of
     this Agreement shall remain in full force and effect and shall not be
     affected by the illegal, invalid or unenforceable provision or by its
     severance herefrom. Furthermore, in lieu of such illegal, invalid or
     unenforceable provision, there shall be added automatically as a part of
     this Agreement, a provision as similar in terms to such illegal, invalid or
     unenforceable provision as may be possible and legal, valid and
     enforceable.

     SUCCESSORS AND ASSIGNS BOUND. Guarantor's obligations and liabilities under
     this Agreement shall be binding upon Guarantor's successors, heirs,
     legatees, devisees, administrators, executors and assigns.

     WAIVE JURY. Guarantor and Lender hereby waive the right to any jury trial
     in any action, proceeding, or counterclaim brought by either against the
     other.

EACH UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT
THIS GUARANTY IS EFFECTIVE UPON GUARANTOR'S EXECUTION AND DELIVERY OF THIS
GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED. NO
FORMAL ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS
GUARANTY IS DATED MAY 11, 2001.

GUARANTOR:

X /s/ Lyle Stockstill
 --------------------------------------------
 LYLE STOCKSTILL             SSN:###-##-####)
================================================================================
<PAGE>   21
                              COMMERCIAL GUARANTY

<TABLE>
PRINCIPAL     LOAN DATE     MATURITY      LOAN NO      CALL      COLLATERAL      ACCOUNT      OFFICER      INITIALS
<S>           <C>           <C>           <C>          <C>       <C>             <C>           <C>         <C>
                                                       590         4635          5439329        L32

</TABLE>
References in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item.


BORROWER:   TORCH OFFSHORE, L.L.C. (TIN: 72-1471586)
            401 WHITNEY AVENUE SUITE 400
            GRETNA, LA 70056-2503

GUARANTOR:  LANA HINGLE STOCKSTILL (SSN:###-##-####)
            401 WHITNEY AVENUE SUITE 400
            GRETNA, LA 70056

LENDER:     REGIONS BANK TIN: 63-0371391
            COMMERCIAL LENDING
            301 ST. CHARLES AVENUE
            3RD FLOOR
            NEW ORLEANS, LA 70130

------------------------------------------------------------------------------

AMOUNT OF GUARANTY. THE AMOUNT OF THIS GUARANTY IS UNLIMITED.

DEFINITIONS. The following terms shall have the following meanings when used in
this Agreement:

     AGREEMENT. The word "Agreement" means this Guaranty Agreement as this
     Agreement may be amended or modified from time to time.

     BORROWER. The word "Borrower" means individually, collectively and
     interchangeably TORCH OFFSHORE, L.L.C.

     GUARANTOR. The word "Guarantor" means individually, collectively and
     interchangeably LANA HINGLE STOCKSTILL (SSN: ###-##-####) and all other
     persons quaranteeing payment and satisfaction of Borrower's Indebtedness as
     hereinafter defined.

     INDEBTEDNESS. The word "Indebtedness" means individually, collectively,
     interchangeably and without limitation any and all present and future
     loans, loan advances, extensions of credit, obligations and/or liabilities
     that Borrower may now and/or in the future owe to and/or incur in favor of
     Lender, whether direct or indirect, or by way of assignment or purchase
     of a participation interest, and whether absolute or contingent, voluntary
     or involuntary, determined or undetermined, liquidated or unliquidated, due
     or to become due, secured or unsecured, and whether Borrower may be liable
     individually, jointly or solidarily with others, whether primarily or
     secondarily, or as a guarantor or otherwise, and whether now existing or
     hereafter arising, of every nature and kind whatsoever, in principal,
     interest, costs, expenses and attorneys' fees and other fees and charges,
     including without limitation Borrower's Indebtedness and obligations under
     a certain promissory note in favor of Lender dated MAY 11, 2001 IN THE
     FIXED PRINCIPAL AMOUNT OF U.S. $8,000,000.00. IN ADDITION, ALL INTEREST
     THEREON, COSTS, EXPENSES, ATTORNEY'S FEES AND OTHER FEES AND CHARGES
     RELATED THERETO UNDER BORROWER'S INDEBTEDNESS SHALL BE FULLY GUARANTEED
     HEREUNDER.

     LENDER. The word "Lender" means Regions Bank, Commercial Lending TIN:
     63-0371391, its successors and assigns, and any subsequent holder or
     holders of Borrower's Indebtedness.

GUARANTEE OF BORROWER'S INDEBTEDNESS. GUARANTOR HEREBY ABSOLUTELY AND
UNCONDITIONALLY AGREES TO, AND BY THESE PRESENTS DOES HEREBY, GUARANTEE THE
PROMPT AND PUNCTUAL PAYMENT, PERFORMANCE AND SATISFACTION OF ANY AND ALL OF
BORROWER'S PRESENT AND FUTURE INDEBTEDNESS IN FAVOR OF LENDER.

CONTINUING GUARANTY. THIS IS A CONTINUING GUARANTY AGREEMENT UNDER WHICH
GUARANTOR AGREES TO GUARANTEE PAYMENT OF BORROWER'S PRESENT AND FUTURE
INDEBTEDNESS IN FAVOR OF LENDER ON A CONTINUING BASIS. Guarantor's obligations
and liability under this Agreement shall be open and continuous in effect.
Guarantor intends to and does hereby guarantee at all times the prompt and
punctual payment, performance and satisfaction of all of Borrower's present and
future Indebtedness in favor of Lender. Accordingly, any payments made on
Borrower's Indebtedness will not discharge or diminish the obligations and
liability of Guarantor under this Agreement for any remaining and succeeding
Indebtedness of Borrower in favor of Lender. To the extent that Guarantor is or
may become a Member/Owner of Borrower, Guarantor agrees that, notwithstanding
the provision of La. R.S. 12:1320, Guarantor shall be liable under this
Agreement for Borrower's Indebtedness in favor of Lender.

JOINT, SEVERAL AND SOLIDARY LIABILITY. Guarantor's obligations and liability
under this Agreement shall be on a "solidary" or "joint and several" basis along
with Borrower to the same degree and extent as if Guarantor had been and/or will
be a co-borrower, co-principal obligor and/or co-maker of Borrower's
Indebtedness. In the event that there is more than one Guarantor under this
Agreement, or in the event that there are other guarantors, endorsers or
sureties of all or any portion of Borrower's Indebtedness, Guarantor's
obligations and liability hereunder shall further be on a "solidary" or "joint
and several" basis along with such other guarantors, endorsers and/or sureties.

DURATION OF GUARANTY. This Agreement and Guarantor's obligations and liability
hereunder shall remain in full force and effect until such time as this
Agreement may be cancelled or otherwise terminated by Lender under a written
cancellation instrument in favor of Guarantor (subject to the automatic
reinstatement provisions hereinbelow). It is anticipated that fluctuations may
occur in the aggregate amount of Borrower's Indebtedness guaranteed under this
Agreement and it is specifically acknowledged and agreed to by Guarantor that
reductions in the amount of Borrower's Indebtedness, even to zero ($0.00)
dollars, prior to Lender's written cancellation of this Agreement, shall not
constitute or give rise to a termination of this Agreement.

CANCELLATION OF AGREEMENT; EFFECT. Unless otherwise indicated under such a
written cancellation instrument, Lender's agreement to terminate or otherwise
cancel this Agreement shall affect only, and shall be expressly limited to,
Guarantor's continuing obligations and liability to guarantee Borrower's
Indebtedness incurred, originated and/or extended (without prior commitment)
after the date of such a written cancellation instrument; with Guarantor
remaining fully obligated and liable under this Agreement for any and all of
Borrower's Indebtedness incurred, originated, extended, or committed to prior to
the date of such a written cancellation instrument. Nothing under this Agreement
or under any other agreement or understanding by and between Guarantor and
Lender, shall in any way obligate, or be construed to obligate, Lender to agree
to the subsequent termination or cancellation of Guarantor's obligations and
liability hereunder; it being fully understood and agreed to by Guarantor that
Lender has and intends to continue to rely on Guarantor's assets, income and
financial resources in extending credit and other indebtedness to and in favor
of Borrower, and that to release Guarantor from Guarantor's continuing
obligations and liabilities under this Agreement would so prejudice Lender that
Lender may, within its sole and uncontrolled discretion and judgment, refuse to
release Guarantor from any of its continuing obligations and liability under
this Agreement for any reason whatsoever as long as any of Borrower's
Indebtedness remains unpaid and outstanding, or otherwise.

DEFAULT. Should any event of default occur or exist under any of Borrower's
Indebtedness in favor of Lender, Guarantor unconditionally and absolutely agrees
to play Lender the then unpaid amount of Borrower's Indebtedness, in principal,
interest, costs, expenses, attorney's fees and other fees and charges. Such
payment or payments shall be made at Lender's offices indicated above,
immediately following demand by Lender.

GUARANTOR'S WAIVERS. Guarantor hereby waives:

     (a) Notice of Lender's acceptance of this Agreement.

     (b) Presentment for payment of Borrower's Indebtedness, notice of dishonor
     and of nonpayment, notice of intention to accelerate, notice of
     acceleration, protest and notice of protest, collection or instruction of
     any suit or other action by Lender in collection thereof, including any
     notice of default in payment thereof, or other notice to, or demand for
     payment thereof, on any party.

     (c) Any right to require Lender to notify Guarantor of any nonpayment
     relating to any collateral directly or indirectly securing Borrower's
     indebtedness, or notice of any action or nonaction on the part of Borrower,
     Lender, or any other guarantor, surety or endorser of Borrower's
     Indebtedness, or notice of the creation of any new or additional
     Indebtedness subject to this Agreement.

     (d) Any rights to demand or require collateral security from the Borrower
     or any other person as provided under applicable Louisiana law or
     otherwise.

     (e) Any right to require Lender to notify Guarantor of the terms, time and
     place of any public or private sale of any collateral directly or
     indirectly securing Borrower's Indebtedness.

     (f) Any "one action" or "anti-deficiency" law or any other law which may
     prevent Lender from bringing any action, including a claim for deficiency,
     against Guarantor, before or after Lender's commencement or completion of
     any foreclosure action or any action in lieu of foreclosure.

     (g) Any election of remedies by Lender that may destroy or impair
     Guarantor's subrogation rights or Guarantor's right to proceed for
     reimbursement against Borrower or any other guarantor, surety or endorser
     of Borrower's Indebtedness, including without limitation, any loss of
     rights Guarantor may suffer by reason of any law limiting, qualifying, or
     discharging Borrower's Indebtedness.

     (h) Any disability or other defense of Borrower, or any other guarantor,
     surety or endorser, or any other person, or by reason of the cessation from
     any cause whatsoever, other than payment in full of Borrower's
     Indebtedness.

     (i) Any statute of limitations or prescriptive period, if at the time an
     action or suite brought by Lender against Guarantor is commenced, there
<PAGE>   22
05-11-2001                      COMMERCIAL GUARANTY                       PAGE 2
LOAN NO 0001301                    (Continued)
================================================================================

Guarantor warrants and agrees that each of the waivers set forth above is made
with Guarantor's full knowledge of its significance and consequences, and that,
under the circumstances, such waivers are reasonable and not contrary to public
policy or law. If any such waiver is determined to be contrary to any applicable
law or public policy, such waiver shall be effective only to the extent
permitted by law.

GUARANTOR'S SUBORDINATION OF RIGHTS. In the event that Guarantor should for any
reason (a) advance or lend monies to Borrower, whether or not such funds are
used by Borrower to make payment(s) under Borrower's Indebtedness, and/or (b)
make any payment(s) to Lender or others for and on behalf of Borrower under
Borrower's Indebtedness, and/or (c) make any payment to Lender in total or
partial satisfaction of Guarantor's obligations and liabilities under this
Agreement, and/or (d) if any of Guarantor's property is used to pay or satisfy
any of Borrower's Indebtedness, Guarantor hereby agrees that any and all rights
that Guarantor may have or acquire to collect from or to be reimbursed by
Borrower (or from or by any other guarantor, endorser or surety of Borrower's
Indebtedness), whether Guarantor's rights of collection or reimbursement arise
by way of subrogation to the rights of Lender or otherwise, shall in all
respects, whether or not Borrower is presently or subsequently becomes
insolvent, be subordinate, inferior and junior to the rights of Lender to
collect and enforce payment, performance and satisfaction of Borrower's then
remaining Indebtedness, until such time as Borrower's Indebtedness is fully paid
and satisfied. In the event of Borrower's insolvency or consequent liquidation
of Borrower's assets, through bankruptcy, by an assignment for the benefit of
creditors, by voluntary liquidation, or otherwise, the assets of Borrower
applicable to the payment of claims of both Lender and Guarantor shall be paid
to Lender and shall be first applied by Lender to Borrower's then remaining
indebtedness. Guarantor hereby assigns to Lender all claims which it may have or
acquire against Borrower or any assignee or trustee of Borrower in bankruptcy;
provided that, such assignment shall be effective only for the purpose of
assuring to Lender full payment of Borrower's Indebtedness guaranteed under this
Agreement.

If now or hereafter (a) Borrower shall be or become insolvent, and (b)
Borrower's Indebtedness shall not at all times until paid be fully secured by
collateral pledged by Borrower, Guarantor hereby forever waives and relinquishes
in favor of Lender and Borrower, and their respective successors, any claim or
right to payment Guarantor may now have or hereafter have or acquire against
Borrower, by subrogation or otherwise, so that at no time shall Guarantor be or
become a "creditor" of Borrower within the meaning of 11 U.S.C. section 547(b),
or any successor provision of the Federal bankruptcy laws.

GUARANTOR'S RECEIPT OF PAYMENTS. Guarantor further agrees to refrain from
attempting to collect and/or enforce any of Guarantor's collection and/or
reimbursement rights against Borrower (or against any other guarantor, surety or
endorser of Borrower's Indebtedness), arising by way of subrogation or
otherwise, until such time as all of Borrower's then remaining Indebtedness in
favor of Lender is fully paid and satisfied. In the event that Guarantor should
for any reason whatsoever receive any payment(s) from  Borrower (or any other
guarantor, surety or endorser of Borrower's Indebtedness) that Borrower (or
such a third party) may owe to Guarantor for any of the reasons stated above,
Guarantor agrees to accept such payment(s) in trust for and on behalf of Lender,
advising Borrower (or the third party payee) of such fact. Guarantor further
unconditionally agrees to immediately deliver such funds to Lender, with such
funds being held by Guarantor over any interim period, in trust for Lender. In
the event that Guarantor should for any reason whatsoever receive any such funds
from Borrower (or any third party), and Guarantor should deposit such funds in
one or more of Guarantor's deposit accounts, no matter where located, Lender
shall have the right to attach any and all of Guarantor's deposit accounts in
which such funds were deposited, whether or not such funds were commingled with
other monies of Guarantor, and whether or not such funds then remain on deposit
in such an account or accounts. To this end and to secure Guarantor's
obligations under this Agreement, Guarantor collaterally assigns and pledges to
Lender, and grants to Lender a continuing security interest in, any and all of
Guarantor's present and future rights, title and interest in and to all monies
that Guarantor may now and/or in the future maintain on deposit with banks,
savings and loan associations and other entities (other than tax deferred
accounts with Lender), in which Guarantor may at any time deposit any such funds
that may be received from Borrower (or any other guarantor, endorser or surety
of Borrower's Indebtedness) in favor of Lender.

DEPOSIT ACCOUNTS. As collateral security for repayment of Guarantor's
obligations hereunder and under any additional guaranties previously granted or
to be granted by Guarantor in the future, and additionally as collateral
security for any present and future indebtedness of Guarantor in favor of Lender
with the exception of any indebtedness under a consumer credit card account).
Guarantor is granting Lender a continuing security interest in any and all funds
that Guarantor may now and in the future have on deposit with Lender or in
certificates of deposit or other deposit accounts as to which Guarantor is an
account holder (with the exception of IRA, pension and other tax-deferred
deposits). Guarantor further agrees that Lender may at any time apply any funds
that Guarantor may have on deposit with Lender or in certificates of deposit or
other deposit accounts as to which Guarantor is an account holder against the
unpaid balance of any and all other presents and future obligations and
indebtedness of Guarantor to Lender, in principal, interest, fees, costs,
expenses and attorneys' fees.


ADDITIONAL COVENANTS. Guarantor agrees that Lender may, at its sole option, at
any time, and from time to time, without the consent of or notice to Guarantor,
or any of them, or to any other party, and without incurring any responsibility
to Guarantor or to any other party, and without impairing or releasing any of
Guarantor's obligations or liabilities under this Agreement:

     (a) Make additional secured and/or unsecured loans to Borrower.

     (b) Discharge, release or agree not to sue any party (including, but not
     limited to, Borrower or any other guarantor, surety, or endorser of
     Borrower's Indebtedness), who is or may be liable to Lender for any of
     Borrower's Indebtedness.


     (c) Sell, exchange, release, surrender, realize upon, or otherwise deal
     with, in any manner and in any order, any collateral directly or indirectly
     securing repayment of any of Borrower's Indebtedness.

     (d) Alter, renew, extend, accelerate, or otherwise change the manner,
     place, terms and/or times of payment or other terms of Borrower's
     Indebtedness, or any part thereof, including any increase or decrease in
     the rate or rates of interest on any of Borrower's Indebtedness.

     (e) Settle or compromise any of Borrower's Indebtedness.

     (f) Subordinate and/or agree to subordinate the payment of all or any part
     of Borrower's Indebtedness, or Lender's security rights in any collateral
     directly or indirectly securing any such Indebtedness, to the payment
     and/or security rights of any other present and/or future creditors of
     Borrower.

     (g) Apply any payments and/or proceeds to any of Borrower's Indebtedness in
     such priority or with such preferences as Lender may determine in its sole
     discretion, regardless of which of Borrower's Indebtedness then remains
     unpaid.

     (h) Take or accept any other collateral security or guaranty for any or all
     of Borrower's Indebtedness.

     (i) Enter into, deliver modify, amend or waive compliance with, any
     instrument or arrangement evidencing, securing or otherwise affecting, all
     or any part of Borrower's Indebtedness.

NO IMPAIRMENT OF GUARANTOR'S OBLIGATIONS. No course of dealing between Lender
and Borrower (or any other guarantor, surety or endorser of Borrower's
Indebtedness), nor any failure or delay on the part of Lender to exercise any of
Lender's rights and remedies under this Agreement or any other agreement or
agreements by and between Lender and Borrower (or any other guarantor, surety or
endorser), shall have the effect of impairing or releasing Guarantor's
obligations and liabilities to Lender, or of waiving any of Lender's rights and
remedies under this Agreement or otherwise. Any partial exercise of any rights
and remedies granted to Lender shall furthermore not constitute a waiver of any
of Lender's other rights and remedies; it being Guarantor's intent and agreement
that Lender's rights and remedies shall be cumulative in nature. Guarantor
further agrees that, should Borrower default under any of its Indebtedness, any
waiver or forbearance on the part of Lender to pursue Lender's available rights
and remedies shall be binding upon Lender only to the extent that Lender
specifically agrees to such waiver or forbearance in writing. A waiver or
forbearance on the part of Lender as to one event of default shall not
constitute a waiver or forbearance as to any other default.

NO RELEASE OF GUARANTOR. Guarantor's obligations and liabilities under this
Agreement shall not be released, impaired, reduced, or otherwise affected by,
and shall continue in full force and effect notwithstanding the occurrence of
any event, including without limitation any one or more of the following events:

     (a) The death, insolvency, bankruptcy, arrangement, adjustment,
     composition, liquidation, disability, dissolution, or lack of authority
     (whether corporate, partnership or trust) of Borrower (or any person acting
     on Borrower's behalf), or of any other guarantor, surety to endorser of
     Borrower's Indebtedness.

     (b) Any payment by Borrower, or any other party, to Lender that is held to
     constitute a preferential transfer or a fraudulent conveyance under any
     applicable law, or any such amounts or payment which, for any reason,
     Lender is required to refund or repay to Borrower or to any other person.

     (c) Any dissolution of Borrower, or any sale, lease or transfer of all or
     any part of Borrower's assets.

     (d) Any failure of Lender to notify Guarantor of the making of additional
     loans or other extensions of credit in reliance on this Agreement.

AUTOMATIC REINSTATEMENT. This Agreement and Guarantor's obligations and
liabilities hereunder shall continue to be effective, and/or shall automatically
and retroactively be reinstated, if a release or discharge has occurred, or if
at any time, any payment or part thereof to Lender with respect to any of
Borrower's Indebtedness, is rescinded or must otherwise be restored by Lender
pursuant to any insolvency, bankruptcy, reorganization, receivership, or any
other debt relief granted to Borrower or to any other party to Borrower's
Indebtedness or any such security therefor. In the event that Lender must
rescind or restore any payment received in total or partial satisfaction of
Borrower's Indebtedness, any prior release or discharge from the terms of this
Agreement given to Guarantor shall be without effect, and this Agreement and
Guarantor's
<PAGE>   23
05-11-2001                    COMMERCIAL GUARANTY                         Page 3
Loan No 0001301                   (Continued)
================================================================================

obligations and liabilities hereunder shall automatically and retroactively be
renewed and/or reinstated and shall remain in full force and effect to the same
degree and extent as if such a release or discharge had never been granted. It
is the intention of Lender and Guarantor that Guarantor's obligations and
liabilities hereunder shall not be discharged except by Guarantor's full and
complete performance and satisfaction of such obligations and liabilities; and
then only to the extent of such performance.

REPRESENTATIONS AND WARRANTIES BY GUARANTOR. Guarantor represents and warrants
that:

     (a) Guarantor is the lawful power to own its properties and to engage in
     its business as presently conducted.

     (b) Guarantor's guaranty of Borrower's Indebtedness and the Guarantor's
     execution, delivery and performance of this Agreement are not in violation
     of any laws and will not result in a default under any contract, agreement,
     or instrument to which Guarantor is a party, or by which Guarantor or its
     property may be bound.

     (c) Guarantor has agreed and consented to execute this Agreement and to
     guarantee Borrower's Indebtedness in favor of Lender, at Borrower's request
     and not at the request of Lender.

     (d) Guarantor will receive and/or has received a direct or indirect
     material benefit from the transactions contemplated herein and/or arising
     out of Borrower's Indebtedness.

     (e) This Agreement, when executed and delivered to Lender, will constitute
     a valid, legal and binding obligation of Guarantor, enforceable in
     accordance with its terms.

     (f) Guarantor has established adequate means of obtaining information from
     Borrower on a continuing basis regarding Borrower's financial condition.

     (g) Lender has made no representations to Guarantor as to the
     creditworthiness of Borrower.

ADDITIONAL OBLIGATIONS OF GUARANTOR. So long as this Agreement remains in
effect, Guarantor has not and will not, without Lender's prior written consent,
sell, lease, assign, pledge, hypothecate, encumber, transfer, or otherwise
dispose of all or substantially all of Guarantor's assets. Guarantor agrees to
keep adequately informed of any facts, events of circumstances which might in
any way affect Guarantor's risks under this Agreement. Guarantor further agrees
that Lender shall no obligation to disclose to Guarantor any information or
material relating to Borrower or Borrower's Indebtedness.

ADDITIONAL DOCUMENTS; FINANCIAL STATEMENTS. Upon the reasonable request of
Lender, Guarantor will, at any time, and from time to time, execute and deliver
to Lender any and all such financial instruments and documents, and supply such
additional information, as may be necessary or advisable in the opinion of
Lender to obtain the full benefits of this Agreement. Guarantor further agrees
to provide Lender with such financial statements and other related information
at such frequencies and in such detail as Lender may reasonably request.

TRANSFER OF INDEBTEDNESS. This Agreement is for the benefit of Lender and for
such other person or persons as may from time to time become or be the holders
of all or any part of Borrower's Indebtedness. This Agreement shall be
transferrable and negotiable with the same force and effect and to the same
extent as Borrower's Indebtedness may be transferrable; it being understood and
agreed to by Guarantor that, upon any transfer or assignment of all or any part
of Borrower's Indebtedness, the holder of such Indebtedness shall have all of
the rights and remedies granted to Lender under this Agreement. Guarantor
further agrees that, upon any transfer of all or any portion of Borrower's
Indebtedness, Lender may transfer and deliver any and all collateral securing
repayment of such Indebtedness (including, but not limited to, any collateral
provided by Guarantor) to the transferee of such Indebtedness, and such
collateral shall secure any all of Borrower's Indebtedness in favor of such a
transferee. Guarantor additionally agrees that, after any such transfer or
assignment has taken place, Lender shall be fully discharged from any and all
liability and responsibility to Borrower and Guarantor with respect to such
collateral, and the transferee thereafter shall be vested with all the powers
and rights with respect to such collateral.

CONSENT TO PARTICIPATION. Guarantor recognizes and agrees that Lender may, from
time to time, one or more times, transfer all or any part of Borrower's
Indebtedness through sales of participation interests in such Indebtedness to
one or more third party lenders. Guarantor specifically agrees and consents to
all such transfers and assignments, and Guarantor further waives any subsequent
notice of such transfers and assignments as may be provided under Louisiana
law. Guarantor additionally agrees that the purchaser of a participation
interest in Borrower's Indebtedness will be considered as the absolute owner of
a percentage interest of such Indebtedness and that such a purchaser will have
all of the rights granted under any participation agreement governing the sale
of such a participation interest. Guarantor waives any rights of offset that
Guarantor may have against Lender and/or any purchaser of such a participation
interest, and Guarantor unconditionally agrees that either Lender or such a
purchaser may enforce Guarantor's obligations and liabilities under this
Agreement, irrespective of the failure or insolvency of Lender or any such
purchaser.

NOTICES. Any notice provided in this Agreement must be in writing and will be
considered as given on the day it is delivered by hand or deposited in the U.S.
mail, postage prepaid, addressed to the person to whom the notice is to be
given at the address shown above or at such other addresses as any party may
designate to the other in writing. If there is more than one Guarantor under
this Agreement, notice to any Guarantor shall constitute notice of all
Guarantors.

ADDITIONAL GUARANTIES. Guarantor recognizes and agrees that Guarantor may have
previously granted, and may be in the future grant, one or more additional
guaranties of Borrower's Indebtedness in favor of Lender. Should this occur,
the execution of this Agreement and any additional guaranties on the part of
Guarantor will not be construed as a cancellation of this Agreement or any of
Guarantor's additional guaranties; it being Guarantor's full intent and
agreement that all such guaranties of Borrower's Indebtedness in favor of
Lender shall remain in full force and effect and shall be cumulative in nature
and effect.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Guaranty:

     AMENDMENT. No amendment, modification, consent or waiver of any provision
     of this Agreement, and no consent to any departure by Guarantor therefrom,
     shall be effective unless the same shall be writing signed by a duly
     authorized officer of Lender, and then shall be effective only as to the
     specific instance and for the specific purpose for which given.

     APPLICABLE LAW. This Guaranty has been delivered to Lender and accepted by
     Lender in the State of Louisiana. This Guaranty shall be governed by and
     construed in accordance with the laws of the State of Louisiana.

     CAPTION HEADINGS. Caption headings of the sections of this Agreement are
     for convenience purposes only and are not to be used to interpret or to
     define their provisions. In this Agreement, whenever the context so
     requires, the singular includes the plural and the plural also includes the
     singular.

     SEVERABILITY. If any provision of this Agreement is held to be illegal,
     invalid or unenforceable under present or future laws effective during the
     term hereof, such provision shall be full severable. This Agreement shall
     be construed and enforceable as if the illegal, invalid or unenforceable
     provision had never comprised a part of it, and the remaining provisions of
     this Agreement shall remain in full force and effect and shall not be
     affected by the illegal, invalid or unenforceable provision or by its
     severance herefrom. Furthermore, in lieu of such illegal, invalid or
     unenforceable provision, there shall be added automatically as part of this
     Agreement, a provision as similar in terms to such illegal, invalid or
     unenforceable provision as may be possible and legal, valid and
     enforceable.

     SUCCESSORS AND ASSIGNS BOUND. Guarantor's obligations and liabilities under
     this Agreement shall be binding upon Guarantor's successors, heirs,
     legatees, devisees, administrators, executors and assigns.

     WAIVE JURY. Guarantor and Lender hereby waive the right to any jury trial
     in any action, proceeding, or counterclaim brought by either against the
     other.

EACH UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT
THIS GUARANTY IS EFFECTIVE UPON GUARANTOR'S EXECUTION AND DELIVERY OF THIS
GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED. NO
FORMAL ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS
GUARANTY IS DATED MAY 11, 2001.

GUARANTOR:

[X] /s/ Lana Hingle Stockstill
----------------------------------------------
    LANA HINGLE STOCKSTILL (SSN: ###-##-####)

================================================================================
<PAGE>   24
         [REGIONS BANK LOGO]




May 11, 2001

William J. Blackwell
Torch Offshore, L.L.C.
401 Whitney Avenue, Suite 400
Gretna, LA 70056


Dear Mr. Blackwell:

Regions Bank grants a waiver on both the Eagle Reel Loan and the Working
Capital Line (applicable to the renewal dated 5-11-01 through 11-12-01) for the
following loan covenants through January 1, 2002:

(1) Maximum debt to Tangible Net Worth of 2 to 1 (Reel) and 3 to 1 (Line).

(2) Minimum debt service ratio for a trailing 4 quarter period of not less than
    1.2 computed as of the end of each quarter.

For the purpose of complying with the requirement that Torch maintain a minimum
tangible net worth of $10 million, Regions Bank does include in the definition
of net worth the preferred stock issuance of $5.3 million.

If you need any further assistance, please call me at 584-1357.

Sincerely,



/s/ Jorge E. Goris



Jorge E. Goris
Senior Vice President






  Post Office Box 30280  New Orleans, Louisiana 70190  Telephone 504 587-1888