Exhibit 10.111



                    AMENDED AND RESTATED INDENTURE OF TRUST

                           Dated as of July 9, 1996

                   READING & BATES DRILLING CO., as Borrower

                                    - and -

           READING & BATES EXPLORATION CO., as Subsidiary Guarantor

                                    - and -

                 HRB RIG CORPORATION, as Subsidiary Guarantor

                                    - and -

                           WILMINGTON TRUST COMPANY,
                                  as Trustee

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                               TABLE OF CONTENTS
                                                                          Page

INDENTURE OF TRUST  . . . . . . . . . . . . . . . . . . . . . . . . . .  - 1 -
RECITALS OF THE BORROWER AND THE SUBSIDIARY GUARANTOR . . . . . . . . .  - 1 -
GRANTING CLAUSE . . . . . . . . . . . . . . . . . . . . . . . . . . . .  - 2 -

ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION . . . . . . . .  - 3 -


Section 1.01.     Definitions . . . . . . . . . . . . . . . . . . . . .  - 3 -
Section 1.02.     Notices . . . . . . . . . . . . . . . . . . . . . . .  - 5 -
Section 1.03.     Waiver of Notice  . . . . . . . . . . . . . . . . . .  - 6 -
Section 1.04.     Effect of Headings; Table of Contents . . . . . . . .  - 6 -
Section 1.05.     Severability Clause; Further Assurances . . . . . . .  - 6 -
Section 1.06.     Governing Law; Jurisdiction . . . . . . . . . . . . .  - 6 -
Section 1.07.     Appointment of Process Agent  . . . . . . . . . . . .  - 6 -
Section 1.08.     Counterparts  . . . . . . . . . . . . . . . . . . . .  - 7 -
Section 1.09.     Survival  . . . . . . . . . . . . . . . . . . . . . .  - 7 -
Section 1.10.     No Transfer in Violation of Shipping Act  . . . . . .  - 7 -
Section 1.11.     Monies  of Trustee  Received by  the Borrower  and the
                        Subsidiary Guarantors . . . . . . . . . . . . .  - 7 -
Section 1.12.     Binding Effect  . . . . . . . . . . . . . . . . . . .  - 7 -

ARTICLE 2
REPRESENTATIONS, WARRANTIES AND COVENANTS . . . . . . . . . . . . . . .  - 7 -

Section 2.01  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  - 7 -
(a)   Organization and Existence  . . . . . . . . . . . . . . . . . . .  - 8 -
(b)   Power and Authority . . . . . . . . . . . . . . . . . . . . . . .  - 8 -
(c)   Due Authorization, Execution and Enforceability . . . . . . . . .  - 8 -
(d)   No Violations . . . . . . . . . . . . . . . . . . . . . . . . . .  - 8 -
(e)   Liens and Security Interests  . . . . . . . . . . . . . . . . . .  - 8 -
(f)   Notices of Defaults . . . . . . . . . . . . . . . . . . . . . . .  - 8 -

Section 2.02  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  - 8 -
(a)   Organization Existence  . . . . . . . . . . . . . . . . . . . . .  - 8 -
(b)   Power and Authority . . . . . . . . . . . . . . . . . . . . . . .  - 9 -
(c)   Due Authorization, Execution and Enforceability . . . . . . . . .  - 9 -
(d)   No Violations . . . . . . . . . . . . . . . . . . . . . . . . . .  - 9 -

ARTICLE 3
REMEDIES UPON AN EVENT OF DEFAULT . . . . . . . . . . . . . . . . . . .  - 9 -

Section 3.01.     Remedies  . . . . . . . . . . . . . . . . . . . . . .  - 9 -
Section 3.02.     Suits for Enforcement by Trustee  . . . . . . . . . .  - 9 -
Section 3.03.     Enforcement of Claims by Trustee  . . . . . . . . . .  - 9 -
Section 3.04.     Application of Monies Collected After Default . . . . - 10 -

Section 3.05.     Rights and Remedies Cumulative  . . . . . . . . . . . - 10 -
Section 3.06.     Delay or Omission Not Waiver  . . . . . . . . . . . . - 10 -
Section 3.07.     Discontinuance of Enforcement Proceedings . . . . . . - 11 -
Section 3.08.     Control by the Required Banks . . . . . . . . . . . . - 11 -
Section 3.09.     Undertaking for Costs . . . . . . . . . . . . . . . . - 11 -
Section 3.10.     Waiver of Demand, etc . . . . . . . . . . . . . . . . - 11 -

ARTICLE 4
THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 12 -

Section 4.01.     Certain Duties and Liabilities  . . . . . . . . . . . - 12 -
Section 4.02.     Certain Rights of Trustee . . . . . . . . . . . . . . - 13 -
Section 4.03.     Not Responsible for Recitals  . . . . . . . . . . . . - 13 -
Section 4.04.     Money Held in Trust . . . . . . . . . . . . . . . . . - 14 -
Section 4.05.     Compensation, Reimbursement and Indemnification . . . - 14 -
Section 4.06.     Corporate Trustee Required; Eligibility . . . . . . . - 14 -
Section 4.07.     Disqualification,  Removal  or   Resignation  of   the
                        Trustee; Successor Trustees . . . . . . . . . . - 15 -
Section 4.08.     Co-trustees and Separate Trustees . . . . . . . . . . - 17 -

ARTICLE 5
SATISFACTION AND DISCHARGE  . . . . . . . . . . . . . . . . . . . . . . - 18 -

Section 5.01.     General . . . . . . . . . . . . . . . . . . . . . . . - 18 -
Section 5.02.     Survival of Certain Obligations . . . . . . . . . . . - 18 -

ARTICLE 6
SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . . . . . . . . . . - 18 -

Section 6.01.     Waivers  and Supplemental  Indentures with  Consent of
                        Banks . . . . . . . . . . . . . . . . . . . . . - 18 -
Section 6.02.     Execution of Supplemental Indentures  . . . . . . . . - 18 -
Section 6.03.     Effect of Supplemental Indentures . . . . . . . . . . - 19 -

ARTICLE 7
INSTRUCTIONS OF THE AGENT OR REQUIRED BANKS . . . . . . . . . . . . . . - 19 -

Section 7.01.     Instructions of the Agent or Required Banks.  . . . . - 19 -

ARTICLE 8
LIMITATION OF LIABILITY . . . . . . . . . . . . . . . . . . . . . . . . - 19 -

Section 8.01.     Limitation of Liability of Wilmington Trust Company.  - 19 -

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

                               INDENTURE OF TRUST


      THIS AMENDED AND RESTATED INDENTURE OF TRUST (this "Indenture") dated as
of  July  9,  1996, among  (i)  READING  &  BATES  DRILLING CO.,  an  Oklahoma
corporation  as borrower (the  "Borrower"); (ii)  READING &  BATES EXPLORATION
CO., an Oklahoma corporation as subsidiary guarantor, ("Exploration") and  HRB
RIG CORPORATION,  an Oklahoma corporation  as subsidiary guarantor  ("HRB" and
together with Exploration collectively the "Subsidiary Guarantors"); and (iii)
WILMINGTON  TRUST  COMPANY,  a  Delaware  banking   corporation,  not  in  its
individual capacity but solely as indenture trustee (the "Trustee").

             RECITALS OF THE BORROWER AND THE SUBSIDIARY GUARANTOR

      A.    By  a Credit Agreement  dated as of  April 30, 1996  ( as amended,
restated  or supplemented  from time  to time,  the "Credit  Agreement") among
Reading   &  Bates   Corporation,   a  Delaware   corporation,  as   guarantor
("Holdings"),  the Borrower,  the banks  party thereto  (the "Banks"),  Credit
Lyonnais  New York Branch, as  co-agent, and Christiania  Bank og Kreditkasse,
New  York branch,  as agent  (the "Agent"),  the Banks  made available  to the
Borrower  upon the terms and conditions therein described a reducing revolving
credit   facility  (the  "Facility")  in  an  aggregate  amount  at  any  time
outstanding  of One  Hundred  Million United  States Dollars  (US$100,000,000)
providing for  the  making  of Loans  (as  defined in  the  Credit  Agreement)
evidenced  by a promissory note of the  Borrower (the "Note") and the issuance
of,  and  participation in,  Letters  of  Credit  (as  defined in  the  Credit
Agreement) as contemplated therein.

      B.    Pursuant  to  the  Credit  Agreement,  Exploration  for  good  and
valuable  consideration  authorized,  executed   and  delivered  a  Subsidiary
Guaranty dated April 30, 1996 (the "Exploration Subsidiary Guaranty") in favor
of the Agent  guaranteeing the performance by the Borrower  of its obligations
under the Credit Agreement and  the other Credit Documents (as defined  in the
Credit Agreement).

      C.    Pursuant  to the Credit Agreement and to secure the obligations of
the  Borrower  thereunder, (i)  the Borrower  executed  and delivered  a first
preferred mortgage on the U.S. documented semi-submersible drilling  unit JACK
BATES; and (ii)  Exploration executed and delivered first  preferred mortgages
(together with the  first preferred mortgage on the  JACK BATES, the "Original
Mortgages")  on each  of (1) the  U.S. documented jack-up  drilling unit, D.R.
STEWART and (2) the U.S. documented offshore drilling unit W.D. KENT (together
with the JACK BATES, the "Original Vessels").  

      D.    To  secure  their  respective  obligations under  (i)  the  Credit
Agreement  and  the Note  and (ii)  the  Exploration Subsidiary  Guaranty, the
Borrower  and  Exploration  have executed  and  delivered  to  the Trustee  an
Indenture of Trust dated as of April 30, 1996 (the "Original Indenture").

      E.    By an Amendment  dated as of July 9, 1996  to the Credit Agreement
(the  "Amendment"), it  was agreed  among  other things  that the  Banks would
increase the amount available to  the Borrower under the Facility  (as defined
in the Credit Agreement) to an aggregate amount at any time outstanding of One
Hundred Forty Million  United States Dollars ($140,000,000),  subject to semi-
annual reductions as set forth therein.

      F.    Pursuant  to the Credit Agreement and to secure the obligations of
the Borrower thereunder, (i) the Borrower  is required to execute and  deliver
an  amendment to  first  preferred  mortgage  on  the  U.S.  documented  semi-
submersible  drilling unit JACK BATES; (ii) Exploration is required to execute
and deliver amendments  to the first  preferred mortgages on  each of (1)  the
U.S.  documented  jack-up  drilling  unit,  D.R.  STEWART  and  (2)  the  U.S.
documented  offshore drilling  unit W.D.  KENT and  (iii)  HRB is  required to
execute  and  deliver a  subsidiary  guaranty (together  with  the Exploration
Subsidiary  Guaranty,  the  "Subsidiary  Guaranties"  and  a  first  preferred
mortgage (together with the  Original Mortgages, the "Mortgages") on  the U.S.
documented  jack-up unit HARVEY H.  WARD (together with  the Original Vessels,
the "Vessels").  As certain of the Banks are not citizens of the United States
of America  within the  meaning of  Section 2  of the  Shipping Act,  1916, as
amended, and  are ineligible to be  mortgagees of the Vessels,  the Banks have
requested the  Trustee to hold, pursuant  to the terms of  this Indenture, the
Mortgages.

      G.    All things have been  done which are necessary to  constitute this
Indenture  a valid security  agreement and  contract for  the security  of the
respective obligations of the  Borrower and each of the  Subsidiary Guarantors
under  (i)  the  Credit  Agreement  and  the  Note  and  (ii)  the  Subsidiary
Guaranties,  respectively,  in  accordance  with   the  terms  of  the  Credit
Agreement, the Note, the Subsidiary Guaranties and this Indenture.

                                GRANTING CLAUSE
               NOW, THEREFORE, THIS INDENTURE WITNESSETH, that,

      To secure the  payment of the Loans, the Unpaid  Drawings (as defined in
the  Credit  Agreement) and  interest thereon  and  all other  Obligations (as
defined  below)  and  the performance  of  the  covenants  therein and  herein
contained, and in  consideration of the premises and of  the Banks' making the
Facility available to the Borrower, and other good and valuable consideration,
the Borrower and the Subsidiary Guarantors  by these presents do grant,  sell,
convey, assign,  transfer, pledge, set over  and confirm unto the  Trustee for
the benefit of the Banks, continuing security interests in all of their right,
title and interest in and all benefits in, under and to all of  the following,
but as security only for the payment of the Obligations:

      1.    The  U.S.  documented vessel  JACK BATES,  as  granted by  a first
            preferred mortgage, as amended, on the JACK BATES by the Borrower;

      2.    The U.S. documented  vessel D.R.  STEWART, as granted  by a  first
            preferred   mortgage,  as   amended,  on   the  D.R.   STEWART  by
            Exploration;

      3.    The  U.S. documented  vessel  W.D. KENT,  as  granted by  a  first
            preferred mortgage, as amended, on the W.D. KENT by Exploration;

      4.    The U.S. documented vessel HARVEY  H. WARD, as granted by  a first
            preferred mortgage on the HARVEY H. WARD by HRB; and

      5.    Proceeds of the foregoing.

      The  Trustee shall  hold the  Mortgages as  collateral security  for the
Obligations, subject to the terms of this Indenture.

      AND IT IS  HEREBY COVENANTED  AND DECLARED that  the security  interests
granted above  are to  be  held and  applied by  the Trustee,  subject to  the
further  covenants, conditions and trusts  herein set forth,  and the Borrower
and the Subsidiary  Guarantors do hereby  covenant and agree  to and with  the
Trustee, for the benefit of the Banks as follows:


                                   ARTICLE 1
            DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

Section 1.01.     Definitions.

      (a)   For all purposes of this Indenture, except as otherwise  expressly
provided herein or  unless the context otherwise requires,  in addition to the
words  and expressions  defined in  the recitals  hereto, the  following terms
shall have the following meanings:

      "Actual Knowledge" has the meaning specified in Section 4.01(h).

      "Business Day" shall  have the  meaning ascribed thereto  in the  Credit
      Agreement.

      "Collateral" means the mortgages  listed in the granting clause  of this
      Indenture and proceeds thereof.

      "Dollars",  "dollars"  or  "$"  means  lawful  and  freely  transferable
      currency of the United States.

      "Default  Rate" shall have the rate of interest calculated in accordance
      with Section 1.07(b) of the Credit Agreement.

      "Event  of Default"  has  the meaning  ascribed  thereto in  the  Credit
      Agreement.

      "Instructions" has the meaning set forth in Section 7.01.

      "MARAD" means  the United States Department  of Transportation, Maritime
      Administration.

      "Obligations"  shall means the obligations  of the Borrower  and each of
      the  Subsidiary Guarantors  with  respect to  (i)  the full  and  prompt
      payment  when due  of (x) the  principal of  interest on  the Loans made
      under the Credit Agreement, and all reimbursement obligations and Unpaid
      Drawings with respect to  the Letters of Credit issued under  the Credit
      Agreement  and (y)  all other  obligations and  indebtedness (including,
      without  limitation,  indemnities,  Fees   (as  defined  in  the  Credit
      Agreement)  and  interest  thereon)  of  the  Borrower  to  the  Secured
      Creditors  (as  defined  herein),  whether  now  existing  or  hereafter
      incurred  under, arising  out  of  or  in  connection  with  the  Credit
      Agreement and the  other Credit  Documents and the  due performance  and
      compliance  by  the  Borrower with  all  of  the  terms, conditions  and
      agreements  contained  in  the Credit  Agreement  and  the  other Credit
      Documents;  (ii) any and  all sums advanced  by the Trustee  in order to
      preserve  the  Collateral  (as  hereinafter  defined)  or  preserve  its
      security  interest  in  the  Collateral;  (iii)  in  the  event  of  any
      proceeding  for  the  collection  or enforcement  of  any  indebtedness,
      obligations,  or liabilities of the Borrower or either of the Subsidiary
      Guarantors referred  to in clause (i)  above, after an  Event of Default
      shall  have occurred and be  continuing, the reasonable  expenses of the
      Trustee of re-taking, holding,  preparing for sale or lease,  selling or
      otherwise  disposing  of  or realizing  on  the  Collateral,  or of  any
      exercise  by  the  Trustee  of   its  rights  hereunder,  together  with
      reasonable  attorneys' fees of counsel  to the Trustee  and court costs;
      and  (iv)  all amounts  paid  by  any  Indemnitee  (as  defined  in  the
      Mortgages) as to which  such Indemnitee has the right  to reimbursement.
      It  is  acknowledged and  agreed  that  the  Obligations  shall  include
      extensions of credit  of the types described  above, whether outstanding
      on the date  of this Indenture or  extended from time to time  after the
      date of this Indenture.

      "Officer's Certificate" means (i) when used with respect to the Borrower
      or  either of  the Subsidiary  Guarantors, a  certificate signed  by the
      president,  the  chief  executive   officer,  any  vice  president,  the
      secretary,  any  assistant secretary,  the  treasurer  or any  assistant
      treasurer of the  Borrower or  the Subsidiary Guarantors  and (ii)  when
      used with respect to the Trustee,  a certificate signed by a Responsible
      Officer of the Trustee.

      "Person" means any individual, corporation, partnership,  joint venture,
      joint-stock company, trust, unincorporated organization or government or
      any agency or political subdivision thereof.

      "Required  Banks"  has  the  meaning  ascribed  thereto  in  the  Credit
      Agreement.

      "Responsible  Officer", when used with respect to the Trustee, means any
      officer  with  direct  responsibility  for the  administration  of  this
      Indenture and also means,  with respect to a particular  corporate trust
      matter, any other officer to whom such matter is referred because of his
      knowledge of  and familiarity with the  particular subject. "Responsible
      Officer",  when  used with  respect to  the  Borrower or  either  of the
      Subsidiary  Guarantors, means  the  president, any  vice president,  the
      secretary,  any  assistant secretary,  the  treasurer  or any  assistant
      treasurer  of the  Borrower or  the Subsidiary  Guarantors or  any other
      officer  or  assistant   officer  of  the  Borrower  or  the  Subsidiary
      Guarantors customarily  performing functions similar to  those performed
      by any of the above-designated officers.

      "Secured Creditors" shall  mean the  Trustee, the Banks,  the Letter  of
      Credit  Issuer  and  the  Agent  under  and  as  defined  in  the Credit
      Agreement.

      "Security  Documents" shall  have the  meaning  ascribed thereto  in the
      Credit Agreement.

      "Supplemental  Indenture"  means  any  indenture  supplemental  to  this
      Indenture entered into pursuant to Article 6.

      "United States" means the United States of America.

      "Unpaid  Drawings"  has  the  meaning  ascribed  thereto  in the  Credit
      Agreement.

      (b)   For  purposes  of  this  Indenture,   unless  otherwise  expressly
provided or unless the  context otherwise, requires, all references  herein to
Articles, Sections or other subdivisions, unless otherwise specified, refer to
the corresponding Articles, Sections and other subdivisions of this Indenture,
and  the terms "hereof, "herein",  hereby" hereafter" and  "herewith" refer to
this Indenture.

      (c)   The terms  defined in this  Article include the plural  as well as
the singular.

      (d)   All other terms  used in  this Indenture and  not defined in  this
Indenture which  are defined by  reference herein  to the Credit  Agreement or
other instruments, have the meanings assigned to them  in the Credit Agreement
or such other instruments.

      (e)   All agreements referred to in this  Article I and in the  Recitals
of this  Indenture mean  such agreements  as originally  executed or,  if duly
amended or supplemented, as so amended or supplemented.

Section 1.02.     Notices.

      (a)   All notices  or other communications  required or permitted  to be
made  hereunder to the Borrower,  the Subsidiary Guarantors,  the Trustee, the
Agent or  the Banks shall  be sufficiently  given if  in writing  and made  or
delivered  by hand  or by certified  or registered  mail, postage  prepaid, by
telex or telecopy, addressed  to the particular parties as  provided below, or
to such other  addresses as such  parties may hereafter  specify by a  written
notice to such other parties (and  with respect to any notice or communication
to the Trustee, with a copy to the Agent):

Borrower/Subsidiary     READING & BATES CORPORATION
Guarantors:             901 Threadneedle, Suite 200
                        Houston, TX  77079

                        Telefax: (713) 496-0285
                        Attention: Chief Financial Officer


Trustee:                WILMINGTON TRUST COMPANY
                        Rodney Square North
                        1100 North Market Street
                        Wilmington, DE 19890-0001
                        Telefax: (302) 651-8882
                        Attention:  Corporate Trust Division

                        With a copy to:

                        Jennifer L. Janss, Esq.
                        Richards, Layton & Finger
                        P.O. Box 551
                        Wilmington, DE 19899


Notices to the Agent shall be addressed to:

                        CHRISTIANIA BANK OG KREDITKASSE, 
                        New York Branch
                        11 West 42nd Street, 7th Floor
                        New York, NY 10036
                        Telefax: (212) 827-4888
                        Attention: Loan Administration

Notices to the  Banks shall be addressed as provided in Annex II to the Credit
Agreement.

Section 1.03.     Waiver of Notice.

      Where this Indenture provides for notice in any manner, such  notice may
be waived  in writing by  the person entitled  to receive such  notice, either
before or  after the event,  and such waiver shall  be the equivalent  of such
notice.


Section 1.04.     Effect of Headings; Table of Contents.                

      The table  of contents, the titles  of the Articles and  the headings of
the Sections and  paragraphs are not a part of this Indenture and shall not be
deemed to affect the meaning or construction of any of its provisions.

Section 1.05.     Severability Clause; Further Assurances.

      In case any  provision of this Indenture or any  other Security Document
shall  be  invalid, illegal  or  unenforceable,  the  validity,  legality  and
enforceability  of the  remaining provisions  of this  Indenture or  any other
Security  Document shall not  in any way  be affected or  impaired thereby. In
case this Indenture or any other Security Document, or any provision hereof or
thereof, shall be  deemed invalid,  illegal or unenforceable,  in whole or  in
part, by reason  of any  present or future  law or any  decision of any  court
having jurisdiction, or if the documents at any time held by the Trustee shall
be deemed  by the  Trustee in  the reasonable  exercise  of its  duties to  be
insufficient for  any reason to implement the rights and powers granted to the
Trustee  herein or  any other Security  Document, then,  from time  to time on
demand of  the Trustee, the  Borrower and  the Subsidiary Guarantors  will do,
execute,  acknowledge and deliver, or cause to be done, executed, acknowledged
and  delivered, such  other  and further  assurances and  documents as  in the
opinion of  the Trustee may  reasonably be required  to create or  confirm the
security interests purported to be created by the Granting Clause hereof or to
perfect the security interest  of the Trustee therein, or otherwise  to obtain
or maintain the full benefits of this Indenture and the Mortgages.

Section 1.06.     Governing Law; Jurisdiction.

      This  Indenture  shall  be  deemed  to  be  a  contract made  under  the
substantive laws  of the  State of  New York  and for  all  purposes shall  be
construed  in accordance  with  the  internal  laws  of  said  State,  without
reference to principles of conflicts  of law.  This Indenture may  be enforced
in the federal  or state courts in  the State of New  York or any other  court
having  jurisdiction.   The  Borrower and  each  of the  Subsidiary Guarantors
hereby  irrevocably submits  itself to  the  nonexclusive jurisdiction  of the
United States District  Court for the  Southern District of  New York and  the
courts of the State of New York located in the City and County of New York for
such purpose.  In addition thereto,  the Borrower  and each of  the Subsidiary
Guarantors irrevocably waives,  to the  fullest extent permitted  by law,  any
objection which it may now or hereafter have to the laying of the venue of any
such  proceeding  brought  in  any  such court  or  any  claim  that  any such
proceeding  brought in  any such  court has  been  brought in  an inconvenient
forum.

Section 1.07.     Appointment of Process Agent.

      The Borrower  and  each of  the  Subsidiary Guarantors  hereby  appoints
Prentice  Hall Corporation, 500 Central Avenue, Albany, New York 12206-2290 as
its agent to accept service  of process in any proceeding on its behalf in the
State of New York  and acknowledges that the purpose  of this provision is  to
provide that  service upon such firm at its  offices in Albany, New York shall
have the  same effect as  if each of the  Borrower and each  of the Subsidiary
Guarantors had been personally served in the State of New York.

Section 1.08.     Counterparts.

      This Indenture may  be executed in  any number of counterparts,  each of
which  shall be an original;  but such counterparts  shall together constitute
but one and the same instrument.

Section 1.09.     Survival.

      All  representations,  warranties,   covenants  and  agreements   herein
contained or made in writing  in connection with any Security  Documents shall
survive the execution of this  Indenture and shall continue in full  force and
effect until the  Indebtedness secured hereby or thereby shall  have been paid
in full, and  the same shall bind  and inure to the benefit  of the respective
successors  and assigns  of the  Borrower, the  Subsidiary Guarantors  and the
Trustee.

Section 1.10.     No Transfer in Violation of Shipping Act.

      Notwithstanding any  other provision herein  to the contrary,  except to
the extent permitted  by law, no sale, transfer or other disposition of any of
the Vessels, or any interest therein, may be made to any  person not a citizen
of the United  States within  the meaning of  Section 2  of the Shipping  Act,
1916, as amended,  without the approval of the Secretary  of Transportation of
the United States or pursuant to an exemption therefrom.

Section 1.11.     Monies  of   Trustee  Received  by  the   Borrower  and  the
Subsidiary Guarantors.

      Any monies  which may from time  to time be received by  the Borrower or
either of the Subsidiary Guarantors which should have been paid to the Trustee
hereunder  shall  be so  received  in  trust for  the  Trustee,  shall not  be
commingled with  other  funds of  the  Borrower or  either  of the  Subsidiary
Guarantors, as the case may be, and shall promptly be remitted to the Trustee.

Section 1.12.     Binding Effect.

      All  the covenants, promises, stipulations and agreements of each of the
Borrower  and each of the  Subsidiary Guarantors in  this Indenture shall bind
each  of  the Borrower  and  each  of  the  Subsidiary  Guarantors  and  their
respective  successors and  assigns, and  shall inure  to the  benefit of  the
Trustee and its  successors and assigns,  whether so expressed  or not.   This
Indenture is for the sole benefit of the Borrower,  the Subsidiary Guarantors,
the Trustee  and the Banks and their respective successors and assigns, and no
other party shall have any right hereunder.



                                   ARTICLE 2
                   REPRESENTATIONS, WARRANTIES AND COVENANTS

Section 2.01.   Each  of the  Borrower and each  of the  Subsidiary Guarantors
represents  and warrants to  the Trustee as  of the date  hereof and covenants
with the Trustee that:

      (a)   Organization and Existence. Each  of the Borrower and each  of the
Subsidiary Guarantors  was duly  organized and  is now  validly existing as  a
corporation under the  laws of the State of Oklahoma  with power and authority
to conduct its business  as the same is presently being conducted. Each of the
Borrower and each of  the Subsidiary Guarantors shall maintain  such existence
so long as this Indenture remains in effect.

      (b)   Power  and Authority.  Each  of  the  Borrower  and  each  of  the
Subsidiary Guarantors had and has legal  power and authority to enter into and
carry out the terms of this Indenture. 

      (c)   Due  Authorization, Execution  and Enforceability.  This Indenture
has been duly authorized by all necessary corporate action on the part of each
of the Borrower and each of the Subsidiary Guarantors, has  been duly executed
and delivered  by each of the  Borrower and each of  the Subsidiary Guarantors
and constitutes, in  accordance with its  terms, the legal, valid  and binding
agreements enforceable against each of the Borrower and each of the Subsidiary
Guarantors,   except  to   the  extent   limited  by   applicable  bankruptcy,
reorganization, insolvency,  moratorium or  other laws of  general application
relating to or affecting the enforcement of creditors' rights as  from time to
time in effect and general equitable principles.

      (d)   No Violations. The  consummation of the  transactions contemplated
by,  and  compliance by  each  of  the Borrower  and  each  of the  Subsidiary
Guarantors  with all the  terms and provisions  of, this Indenture  do not and
will not violate any provisions of the Certificate  of Incorporation or Bylaws
of either of the Borrower or either of the Subsidiary Guarantors, and will not
result in  a breach of  the terms and provisions  of, or constitute  a default
under,  any agreement  or  undertaking  by  the  Borrower  or  the  Subsidiary
Guarantors, or by  which either of them or any  of their respective properties
is bound, or any order  of any court or  administrative agency entered in  any
proceedings to which the Borrower or either of the Subsidiary Guarantors is or
has been a party or violate any applicable statute, rule or regulation.

      (e)   Liens and Security Interests.

            (1)   The security interest granted by this Indenture constitutes,
a  valid perfected  assignment  of and  security  interest in  the  properties
assigned hereby having  a priority over any  other security interests  in such
property.

            (2)   Except pursuant to this Indenture  (or as permitted by  this
Indenture)  or the  Mortgages  (or as  permitted  by the  Mortgages),  neither
Borrower  nor either  of the  Subsidiary Guarantors  has assigned,  pledged or
otherwise  granted a security  interest in or  lien on, and  shall not assign,
pledge or otherwise grant a security interest in or lien on,  the whole or any
part  of,  the  Vessels or  any  rights  assigned  by  this Indenture  or  the
Mortgages.

      (f)   Notices  of Defaults. Upon the occurrence of any Event of Default,
the  Borrower and the Subsidiary Guarantors shall promptly notify the Trustee,
the Agent and the Banks by telecopy, confirmed by letter, unless such Event of
Default shall have been cured.


Section 2.02.  The Trustee represents and warrants that:

      (a)   Organization Existence.  The Trustee was duly organized and is now
validly existing as a banking corporation under laws of the State of Delaware.

      (b)   Power  and Authority.   The  Trustee had  and has legal  power and
authority to enter into and carry out the terms of this Indenture.

      (c)   Due Authorization,  Execution and Enforceability.   This Indenture
has been duly authorized by all necessary corporate action on  the part of the
Trustee,  has been  duly executed and  delivered by the  Trustee and, assuming
this  Indenture constitutes  the legal,  valid and  binding obligation  of the
other  parties hereto, enforceable against such parties in accordance with its
terms, constitutes, in accordance with its terms, the legal, valid and binding
agreement of the Trustee enforceable against the Trustee, except to the extent
limited by  applicable bankruptcy,  reorganization, insolvency,  moratorium or
other laws of  general application relating to or affecting the enforcement of
creditors'  rights as  from  time  to time  in  effect  and general  equitable
principles.

      (d)   No Violations.  The  consummation of the transactions contemplated
by, and compliance  by the Trustee with  all of the  terms and provisions  of,
this Indenture do not and will not  violate any provisions of the Articles  of
Incorporation or By-Laws of the Trustee and will not result in a breach of the
terms and  provisions  of, or  constitute a  default under,  any agreement  or
undertaking of the Trustee  or by which it or any of its property is bound, or
any order of any court or administrative agency entered in  any proceedings to
which the Trustee is or  has been a party  or violate any applicable  statute,
rule or regulation.


                                   ARTICLE 3
                       REMEDIES UPON AN EVENT OF DEFAULT

Section 3.01.     Remedies.

      If  an  Event of  Default  shall have  occurred  and be  continuing, the
Trustee shall be entitled  to, and shall upon receipt  of written Instructions
of the  Agent, without further notice  or demand, enforce and  exercise all or
any of its rights  and powers as a mortgagee under the respective Mortgages at
law, in equity or in admiralty.

Section 3.02.     Suits for Enforcement by Trustee.

      Subject to the provisions of Section 3.08, if an Event  of Default shall
occur  and be  continuing and  the Trustee has  Actual Knowledge  thereof, the
Trustee may in its discretion proceed to protect its rights  and the rights of
the Banks by  such appropriate judicial proceedings as the  Trustee shall deem
most effectual  to protect  any such  rights, or to  protect any  other proper
right, power  or remedy then  available to  the Trustee  under the  Mortgages,
provided  that the Trustee shall  immediately thereafter notify  the Agent and
the Banks by telecopier of any action taken or  proposed to be taken hereunder
and  shall thereafter act only in accordance  with the written Instructions of
the Agent or the Required Banks or either thereof.

Section 3.03.     Enforcement of Claims by Trustee. 

      All rights of action and claims  under this Indenture may be  prosecuted
and enforced by the Trustee in a proceeding brought in its own name as trustee
of  an express trust, and any recovery  of judgment shall, after provision for
the  payment  of  the  reasonable compensation,  expenses,  disbursements  and
advances of  the Trustee,  its agents or  counsel, be for  the benefit  of the
Banks.

Section 3.04.     Application of Monies Collected After Default.

      Any monies  collected by the Trustee pursuant  to any enforcement of any
of  its rights hereunder or under any other  Credit Document on account of the
occurrence of an Event of Default shall be applied as follows:

      (i)   to  the payment  or  reimbursement of  all  amounts owing  to  the
            Trustee of  the type described  in clauses (ii)  and (iii)  of the
            definition of Obligations;

      (ii)  second, to the extent moneys remain after the application pursuant
            to  the preceding clause (i),  an amount equal  to the outstanding
            Obligations shall be  paid to  the Agent for  distribution to  the
            Secured Creditors, with each  Secured Creditor receiving an amount
            equal to  such Obligations  held by  it  or, if  the proceeds  are
            insufficient to pay  in full  all such Obligations,  its Pro  Rata
            Share  (as  defined   below)  of  the   amount  remaining  to   be
            distributed; and

      (iii) third, to the  extent moneys remain after the application pursuant
            to  the  preceding  clauses  (i)   and  (ii),  and  following  the
            termination of this Indenture pursuant  to Article 5, any  surplus
            then remaining  shall be  paid to  the Borrower  or either  of the
            Subsidiary  Guarantors, subject,  however,  to the  rights of  the
            holder of  any then existing lien of  which the Trustee has actual
            notice (without investigation).

      For  purposes  of  this Indenture  "Pro  Rata  Share"  shall mean,  when
calculating  a  Secured Creditors  portion of  any  distribution or  amount in
respect of any Obligations, the amount  (expressed as a percentage) equal to a
fraction the  numerator of which is the then unpaid amount of such Obligations
owning to or held by such Secured Creditor and the denominator of which is the
then outstanding amount of  all such Obligations.  For purposes of determining
the amount  payable to each Secured Creditor, the Trustee shall be entitled to
request each Secured Creditor to furnish it with written notice  of the amount
of Obligations then owed to it and shall be entitled to reply upon the amounts
stated therein in making such distribution.

Section 3.05.     Rights and Remedies Cumulative.

      No right or remedy herein conferred upon or reserved to the Trustee, the
Agent or any of  the Banks is intended to  be exclusive of any other  right or
remedy,  and every right and remedy shall, to  the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder, or
under the other  Security Documents or  now or hereafter  existing at law,  in
equity,  in admiralty, by statute or otherwise. The assertion or employment of
any right or remedy hereunder or otherwise shall not prevent the concurrent or
subsequent assertion or  employment of  another right or  remedy hereunder  or
otherwise.



Section 3.06.     Delay or Omission Not Waiver.

      No delay or omission of the Trustee, the Agent or of any of the Banks to
exercise any right or remedy accruing upon any Event of Default nor any course
of dealings among the Trustee, the Agent, the Banks and the Borrower or either
of Subsidiary Guarantors shall impair any such right or remedy or constitute a
waiver of any Event of Default or an acquiescence therein nor shall any single
exercise or  partial exercise of any  such right or remedy  preclude any other
exercise thereof  or any exercise of any other or further right or remedy; nor
shall  the acceptance by  the Trustee, the  Agent or any  of the Banks  of any
security or  any payment of any part of the  Facility maturing after any Event
of Default or of any payment on account of any past default be construed to be
a waiver of any right to take advantage  of any future Event of Default or  of
any  past  Event of  Default  not completely  cured  thereby.   To  the extent
permitted by law, every  right or remedy given by this  Indenture or any other
Security Document or by  law to the Trustee, the Agent or any of the Banks may
be exercised from  time to  time, and as  often and  in such order  as may  be
deemed expedient, by the Trustee, the Agent or the Banks, as the case may be.

Section 3.07.     Discontinuance of Enforcement Proceedings.

      In case  the Trustee shall have proceeded to enforce any right, power or
remedy under this Indenture  or under any Mortgage  and such proceeding  shall
have  been  discontinued or  abandoned  for  any  reason  or shall  have  been
adversely determined  to  the Trustee,  then,  and  in every  such  case,  the
Borrower, the Subsidiary Guarantors and the Trustee shall be restored to their
former  positions and rights hereunder with respect to the property subject or
intended to be subject  to this Indenture or either Mortgage,  as the case may
be, and all rights, remedies and powers of the Trustee shall continue as if no
such proceedings had been taken.

Section 3.08.     Control by the Required Banks.

      Subject to (i) the  provisions of Section 3.09 and (ii) the requirements
of Sections 9 and 37  of the Shipping Act, 1916, as amended, the  Agent or the
Required Banks shall have the right by written Instructions to the Trustee, to
direct the  time, method and place of conducting any proceeding for any remedy
available  to the Trustee under  this Indenture or  any Mortgage or exercising
any  trust or  power conferred  on  the Trustee  herein or  therein, and  upon
receipt of such written  Instructions, the Trustee, subject to  the provisions
of Article 4, shall  take the actions specified in such  written Instructions,
provided that such written instructions shall not be in conflict with any rule
of law or with this or expose the Indenture Trustee to personal liability.

Section 3.09.     Undertaking for Costs.

      The parties  to  this Indenture  agree,  and  the Banks  by  making  the
Facility available shall be deemed  to have agreed, that any court may  in its
discretion  require, in any  suit for the  enforcement of any  right or remedy
under this Indenture, or in any suit against the Trustee for any  action taken
or omitted by it as Trustee, the filing by any party litigant in such  suit of
an undertaking to pay the costs of such  suit, and that such court may in  its
discretion  assess  reasonable  costs, including  reasonable  attorneys' fees,
against any party litigant  in such suit, having due regard  to the merits and
good  faith of  the claims or  defenses made  by such party  litigant; but the
provisions  of this  Section shall  not apply  to any  suit instituted  by the
Trustee, or to any suit instituted by the Banks, unless  otherwise required by
law.


Section 3.10.     Waiver of Demand, etc.

      The Borrower  and each  of  the Subsidiary  Guarantors hereby  expressly
waives demand  and presentment  for payment,  notice  of nonpayment,  protest,
notice of  protest, notice  of dishonor,  bringing of  suit, and diligence  in
taking any  action to  collect amounts  called for  under this  Indenture, the
other Security Documents, the Subsidiary Guaranties or the Credit Agreement at
any time in connection herewith and therewith.

                                   ARTICLE 4
                                  THE TRUSTEE

Section 4.01.     Certain Duties and Liabilities.

      (a)   The Trustee undertakes to perform such duties and only such duties
as are specifically  set forth in this Indenture, and  no implied covenants or
obligations shall be read into this Indenture against the Trustee.

      (b)   Without limiting the  provisions of paragraph (a)  of this Section
4.01 or  the provisions of Section 3.08,  in any case where  the terms of this
Indenture  or any  Mortgage vest in  the Trustee  non-mandatory, discretionary
authority to take any action or give any  consent or approval upon the request
of the Borrower, either of the Subsidiary Guarantors, the Agent or any of  the
Banks or otherwise,  the Trustee shall  be required, first  to give notice  of
such proposed  action, approval or consent  to the Agent, and  upon receipt of
written Instructions  of the Agent, the Trustee shall act with respect to such
action, approval or consent only in accordance with such written Instructions.

      (c)   In case an Event of Default shall have occurred and be continuing,
the Trustee shall (except as otherwise provided in Section 3.08) exercise such
of the  rights and powers  vested in it  by this Indenture,  and use  the same
degree of care and skill in their exercise, as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs.

      (d)   No provision of this  Indenture shall be construed to  relieve the
Trustee  from  liability  for its  own  gross negligence  or  its  own willful
misconduct or that of its employees, agents, officers and attorneys.

      (e)   Save for the provisions of paragraph (d) hereof, the Trustee shall
not be liable with respect to any action taken or omitted to be taken by it in
accordance with Instructions  of the Agent  or the Required Banks  relating to
the  exercise of any trust, right, remedy  or power conferred upon the Trustee
under  this Indenture  or any  Mortgage,  or exercisable  by  it hereunder  or
thereunder.

      (f)   None of the provisions of this Indenture shall require the Trustee
to  expend  or risk  its  own  funds  or otherwise  incur  personal  financial
liability in the performance of any of its duties or in the exercise of any of
its rights  or powers, if  there is reasonable  ground for believing  that the
repayment of such funds or liability is not reasonably assured to it under the
terms of this Indenture or by special  agreement of the Agent or the  Required
Banks.

      (g)   Whether or not  herein expressly so  provided, every provision  of
this  Indenture relating  to  the conduct  or affecting  the  liability of  or
affording protection to the Trustee shall be subject to the provisions of this
Section.

      (h)   The  Trustee  shall  not  be deemed  to  have  knowledge  ("Actual
Knowledge")  of the existence of an Event  of Default unless the Trustee shall
have received telecopied or other written notice of such Event of Default from
the Agent or  Required Banks, or a Responsible Officer  in the Corporate Trust
Office of the Trustee shall have actual knowledge of such Event of Default.

      (i)   The Trustee shall promptly, upon  receiving Actual Knowledge of an
Event of Default, inform the Agent and the Banks  by telex or telecopy of such
Event of Default.

      (j)   None of the provisions of this Indenture shall require the Trustee
to review or  hold policies of  insurance or to  make any  claims or take  any
other  action with respect to such insurance unless specifically instructed to
do so by the Agent.

      (k)   The Trustee agrees  that it will in its individual capacity and at
its own cost and expense promptly take such action as may be necessary duly to
discharge and satisfy in full all liens on the Mortgages  and other collateral
security held by the Trustee attributable to it in its individual capacity.

Section 4.02.     Certain Rights of Trustee.

      Except as otherwise provided in Section 4.01:

      (a)   The  Trustee  may  rely  and  shall  be  protected  in  acting  or
refraining  from  acting  upon  any  written  statement,  instrument,  notice,
request, instruction, direction or other paper  or document believed by it  to
be  genuine  and to  have been  signed  or presented  by  the proper  party or
parties;

      (b)   The Trustee may  consult with  counsel and the  written advice  of
such  counsel shall  be  full and  complete  authorization and  protection  in
respect  of any action taken, suffered or  omitted by it hereunder in reliance
thereon and in compliance  therewith, absent bad faith, negligence  or willful
misconduct on the part of the Trustee;

      (c)   The  Trustee shall be under  no obligation to  exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
the  Agent or the Required Banks pursuant  to this Indenture, unless the Agent
or the Required Banks shall have offered to the Trustee reasonable security or
indemnity against  the costs and  expenses which  might be incurred  by it  in
compliance with such request or direction; 

      (d)   The Trustee shall not  be bound to make any investigation into the
facts  or  matters  stated  in  any  statement,  instrument,  notice, request,
direction or  other paper  or document  referred to in  paragraph (a)  of this
Section;

      (e)   The Trustee may execute any of  the trusts or powers hereunder  or
perform  any duties  hereunder  either directly  or by  or  through agents  or
attorneys  and the Trustee shall not be  responsible for the negligence of any
attorney or agent appointed by the Indenture Trustee with due care; and

      (f)   Should the Trustee receive written Instructions from the Agent  or
the Required  Banks which  the Trustee,  in its sole  opinion, believes  to be
conflicting Instructions, the  Trustee shall have no duty to  act thereon, but
if indemnified to its satisfaction  for any costs, expenses or liabilities  it
may incur,  it shall seek  instructions concerning its  responsibilities under
this Indenture with respect to such conflicting Instructions from any court of
competent jurisdiction.

Section 4.03.     Not Responsible for Recitals.

      The recitals contained  herein shall be taken as  the statements of each
of the  Borrower and  the Subsidiary  Guarantors, and the  Trustee assumes  no
responsibility for their correctness. The Trustee  makes no representations as
to the validity or sufficiency of this Indenture or any Mortgage.

Section 4.04.     Money Held in Trust.

      Any money  held by the Trustee in trust hereunder need not be segregated
from other funds  except to the extent required by law.   The Trustee shall be
under no liability  for interest on any money received  by it hereunder except
as otherwise  agreed with  the Borrower  and the  Subsidiary Guarantors.   Any
payments  made by  the Trustee under  this Indenture  shall be  made only from
monies held by it in trust hereunder.

Section 4.05.     Compensation, Reimbursement and Indemnification.

      The Borrower and the Subsidiary Guarantors jointly  and severally agree,
subject to the provisions of Article 5:

      (a)   To  pay to the Trustee  from time to  time reasonable compensation
for  all services  rendered by it  hereunder (which compensation  shall not be
limited to any provision of law in regard to  the compensation of a trustee of
an express trust);

      (b)   To  reimburse the  Trustee  upon its  request  for all  reasonable
expenses,  disbursements and  advances  incurred or  made  by the  Trustee  in
accordance  with   any  provision   of  this  Indenture   (including,  without
limitation,  reasonable compensation  and  expenses and  disbursements of  its
agents and counsel and  expenses incurred in enforcing its rights  or remedies
under any Security Document), except any such expense, disbursement or advance
as may be attributable to its gross negligence or willful misconduct; 

      (c)   To indemnify  the Trustee, its directors,  officers, employees and
agents for,  and to  hold it and  them harmless  against, any and  all claims,
losses,  liabilities  or  expenses  of any  kind  (including  attorneys' fees)
incurred without  gross negligence or willful misconduct  on its or their part
and arising out  of or in connection with the  acceptance or administration of
this trust, including the costs and expenses of defending itself or themselves
against any claim of liability in the premises; and 

      (d)   That  to secure the obligations of the Borrower and the Subsidiary
Guarantors under this Section 4.05, the Trustee shall have a lien prior to the
rights of the Banks on all money or property  held or collected by the Trustee
pursuant to this Indenture.

Section 4.06.     Corporate Trustee Required; Eligibility.

      There shall at all times be a Trustee hereunder which shall be a bank or
trust company which  (i) is organized as a corporation or banking association,
and is  doing  business under  the laws  of  the United  States or  any  State
thereof,  (ii) is  authorized  under such  laws  to exercise  corporate  trust
powers, (iii) is a citizen of the United States within the  meaning of Section
2  of the Shipping Act,  1916, as amended,  (iv) is subject  to supervision or
examination by  federal or  state authority,  (v) has a  combined capital  and
surplus (as set forth in its most recent published report of condition) of  at
least  $50,000,000  and  (vi)  is  a trustee  approved  by  the  Secretary  of
Transportation  pursuant to Section  9 and, if  applicable, Section  37 of the
Shipping Act,  1916, as amended,  and Chapter  313 of Title  46 of  the United
States Code.  The Trustee  hereby represents  and  warrants that  on the  date
hereof it complies with the requirements of the foregoing sentence.  If at any
time the Trustee shall cease to  be eligible in accordance with the provisions
of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.

Section 4.07.     Disqualification,  Removal  or Resignation  of  the Trustee;
Successor Trustees.

      (a)   If  the Trustee  ceases at any  time to  be a  Trustee approved by
MARAD, it promptly will so notify the Agent and resign hereunder and cooperate
in all reasonable respects in the appointment of its successor, but shall have
no other  liability hereunder for loss  of its status as  an approved trustee.
The Agent shall  immediately appoint  a qualified successor  trustee or  shall
take the actions provided for below in the event a qualified successor trustee
cannot be  found by it.  In  addition, the Agent may  in its discretion remove
the Trustee  at any time, without cause,  by causing a written  notice of such
removal  to  be  delivered  to  the  Trustee,  the  Borrower,  the  Subsidiary
Guarantors  and the Banks which notice shall  state the effective date and the
name  of the  qualified successor  trustee selected  by the Agent.  No removal
shall  be  effective unless  a qualified  successor  trustee is  available and
willing to act for  the Banks or unless the actions provided  for below in the
event a  qualified successor trustee is  not available to the  Agent have been
initiated. In the event of discharge or removal, the Trustee shall execute all
documents  and take such other actions as  necessary or desirable to the Agent
or the  Required Banks to  transfer the Trustee's  function of trustee  to the
successor  trustee. The  compensation of  the Trustee  shall cease  as of  the
effective date of discharge or removal, except those rights of indemnification
which shall survive its removal. Upon discharge or removal, the Trustee shall,
within  thirty days, furnish the  Agent, the Banks,  the successor trustee and
the Borrower and  the Subsidiary Guarantors a complete accounting of the trust
estate, its  compensation, costs and expenses  as of the date  of discharge or
removal. Such amount shall be promptly paid by the Borrower and the Subsidiary
Guarantors. 

      (b)   (i)   The  Trustee or any successor thereto may resign at any time
without  cause by  giving at  least ninety  days prior  written notice  to the
Agent,  the Banks  and to  the Borrower  and the  Subsidiary Guarantors,  such
resignation to  be effective on the  date specified in such  notice. The Agent
shall, prior to the date specified in such notice, appoint a successor trustee
meeting  the  requirements  of Section  4.06.  If  the  Agent shall  not  have
appointed  such a  qualified successor  trustee within  sixty days  after such
notice,  the Trustee  may  apply to  any court  of  competent jurisdiction  to
appoint  a qualified successor trustee  to act until  such time, if  any, as a
successor  shall have  been  appointed by  the Agent  as herein  provided. Any
qualified successor trustee so  appointed by such court shall  immediately and
without further act be superseded by any qualified successor trustee appointed
by the Agent. Any  banking institution or trust  company becoming a  successor
trustee hereunder  shall be deemed  the Trustee  for all purposes  hereof, and
each reference herein to the Trustee shall thereafter be deemed a reference to
such banking institution or trust company.

            (ii)  Any successor  trustee, whether appointed  by a court  or by
the Agent  as provided in subparagraph  (b) (i), shall execute  and deliver to
the  predecessor  trustee  an   instrument  accepting  such  appointment,  and
thereupon such  successor trustee,  without further  act, shall  become vested
with  all the estates,  properties, rights, powers,  duties and trusts  of the
predecessor trustee in the trust  hereunder with like effect as  if originally
named as the Trustee  herein; and such predecessor  trustee shall execute  and
deliver  an instrument transferring to such successor trustee, upon the trusts
herein  expressed,  all the  estates, properties,  rights, powers,  duties and
trusts  of such predecessor trustee,  and such predecessor  trustee shall duly
assign,  transfer, deliver and pay over to such successor trustee any property
or monies or other things of value then held by such predecessor  trustee upon
the trusts herein expressed.

            (iii) Any successor trustee, however appointed, shall be a trustee
approved by MARAD in accordance with the provisions of Chapter 313 of Title 46
of the United States Code.

            (iv)  Any bank into which  the Trustee may be merged  or converted
or with  which it may be consolidated, or  any bank resulting from any merger,
conversion on consolidation to which the Trustee shall be a party, or any bank
to  which substantially  all  the business  of the  Indenture  Trustee may  be
transferred,  shall,  subject to  the terms  of this  Section 4.07(b),  be the
Trustee under this Indenture  without any further act, provided  the successor
bank remains qualified.

            (v)   Within sixty days of the  effective date of its resignation,
the Trustee  shall provide the Agent  a statement and accounting  as though it
had been removed in accordance with Section 4.07(a) hereof.

      (c)   A successor trustee shall be appointed by an instrument in writing
which shall  state the  effective date on  which said successor  trustee shall
become the Trustee hereunder and  the holder of this instrument and  the trust
estate,  which   document  shall  contain  the   executed  acknowledgement  of
acceptance by  the successor trustee  of the trust,  the trust estate  and the
duties of the Trustee as herein provided.

      The  Trustee or  any  predecessor trustee  shall duly  assign, transfer,
deliver  and pay  over to  any successor  trustee any  property and  monies or
things of value  subject to the trust hereunder and held by the Trustee or any
predecessor trustee, as the case may  be. Should any act or further instrument
from  the Trustee, any  predecessor trustee, or  the Banks be  required by any
successor trustee for  more fully and certainly  vesting in and  confirming to
such successor  trustee such estates, properties, rights, remedies and trusts,
then  on  request by  such  successor  trustee  any  and  all  such  acts  and
instruments shall be done,  made, executed, acknowledged and delivered  by the
Indenture Trustee, any predecessor trustee, or the Banks, as the case may be.

      (d)   Should for any reason  the Agent be unable  to locate a  qualified
successor  trustee, then  prior  to  ceasing to  act  as  trustee or  becoming
disqualified to do so the Trustee shall cooperate with the Agent and the Banks
in the following:

            (i)   First,   petition  MARAD   for   approval  of   a  presently
unqualified bank  or trust company satisfactory  to the Agent or  the Required
Banks and willing to act as trustee;

            (ii)  If  MARAD approval  cannot  be obtained  for such  available
unqualified trustee then the Agent or the Required Banks and the Trustee shall
petition the United  States District  Court for the  Southern District of  New
York for instructions to  the Trustee in  order that the  trust estate may  be
preserved and to prevent  the Agent, the Banks or the  Trustee from falling in
violation of law.  To the extent that such  may be required or  necessary, the
parties  hereto agree  that  said Court  has  jurisdiction for  this  purpose;
however, if, in the interest of justice, the said Court determines to transfer
the matter to any  other United States court, the parties hereby  agree to the
jurisdiction of such transferee court. Any such  petition shall be served upon
the parties hereto and MARAD, with a copy mailed to the chief counsel of MARAD
and the Borrower and the Subsidiary Guarantors. The Trustee and any  successor
trustee hereby  agree to abide by  the instructions of the  court issuing same
and to all acts, execute such documents and instructions as may be required in
connection  therewith and  all other  instruments and  documents necessary  to
preserve  the trust estate  for the  benefit of  the Banks,  as beneficiaries,
under the  terms hereof as well as  preserving the adequacy and enforceability
of any interest held in the trust estate.

Section 4.08.     Co-trustees and Separate Trustees.

      At any time or times, for the purpose of meeting  the legal requirements
of any  jurisdiction in  which any security  may at the  time be  located, the
Borrower,  the Subsidiary  Guarantors  and the  Trustee  shall have  power  to
appoint, and upon  the written request  of the  Trustee, the Agent  or of  the
Required  Banks, the  Borrower and  the Subsidiary  Guarantors shall  for such
purpose  join with the Trustee  in execution, delivery  and performance of all
instruments and agreements necessary or proper to appoint, one or more persons
approved by the Trustee either to act as co-trustee, jointly with the Trustee,
and,  if  deemed necessary  by  the appointing  party, as  secured  party with
respect to all or any part of the security, or to act as separate trustee and,
if deemed  necessary as aforesaid, as  secured party with respect  to any such
property, in either case with such powers as may be provided in the instrument
of  appointment,  and to  vest  in  such person  or  persons  in the  capacity
aforesaid,  any property, title, right or power deemed necessary or desirable,
subject  to the  other provisions  of this  Section. If  the Borrower  and the
Subsidiary  Guarantors do  not join  in such  appointment within  fifteen days
after the receipt  by them  of a  request so to  do, or  in case  an Event  of
Default has occurred  and is continuing, the  Trustee acting alone  shall have
power to make such appointment.

      Any person appointed as  co-trustee or separate trustee hereunder  shall
satisfy the qualifications prescribed in clauses (i), (iii), (iv) and (vi)  of
Section 4.06.

      Should any  written  instrument from  the  Borrower and  the  Subsidiary
Guarantors be required by any co-trustee or separate  trustee so appointed for
more  fully confirming to such  co-trustee or separate  trustee such property,
title, right  or power, any  and all  such instruments shall,  on request,  be
executed,  acknowledged and  delivered  by  the  Borrower and  the  Subsidiary
Guarantors.

      Every co-trustee or separate  trustee shall, to the extent  permitted by
law, but  to such extent  only, be appointed  subject to the  following terms,
namely:

      (a)   All rights, powers, duties and obligations hereunder in respect of
the custody  of the Security Documents held by the Trustee hereunder, shall be
exercised solely by the Trustee.

      (b)   The  rights, powers,  duties and  obligations hereby  conferred or
imposed  upon  the  Trustee  in  respect  of  any  property  covered  by  such
appointment shall be conferred  or imposed upon and exercised or  performed by
the Trustee or by the Trustee and such co-trustee or separate trustee jointly,
as shall be provided in the instrument appointing such co-trustee or  separate
Trustee, except to the extent  that under any law or any jurisdiction in which
any  particular act is  to be performed,  the Trustee shall  be incompetent or
unqualified to  perform such act, in  which event such rights,  powers, duties
and  obligations  shall  be exercised  and  performed  by  such co-trustee  or
separate trustee.

      (c)   The Trustee at any time, by  an instrument in writing executed  by
it,  with  the  concurrence of  the  Borrower  and  the Subsidiary  Guarantors
evidenced by separate  resolutions of the  board of directors  of each of  the
Borrower  and  the Subsidiary  Guarantors, may  accept  the resignation  of or
remove any co-trustee or  separate trustee appointed under this  Section, and,
in case an Event of Default shall have occurred and be continuing, the Trustee
may act alone in  the execution, delivery and  performance of all  instruments
and  agreements necessary or proper to effectuate such resignation or removal.
A  successor to any co-trustee or separate  trustee so resigned or removed may
be appointed in the manner provided in this Section.

      (d)   No co-trustee  or separate  trustee hereunder shall  be personally
liable  by reason  of any act  or omission  of the  Trustee or any  other such
trustee hereunder.

      (e)   Any notice of instruction delivered to the Trustee by the Agent or
the Required  Banks  shall be  deemed  to have  been  delivered to  each  such
co-trustee and separate trustee.

                                  ARTICLE 5
                          SATISFACTION AND DISCHARGE

Section 5.01.     General.

      If the Borrower and the  Subsidiary Guarantors shall pay or cause  to be
paid all of  the Obligations, then  this Indenture and  the liens, estate  and
rights  and interest  hereby and  thereby created  shall cease,  determine and
become null  and void, and the  Trustee, upon written request  of the Borrower
and the Subsidiary Guarantors, accompanied by an opinion of counsel acceptable
to the Trustee, and at the cost and expense of the Borrower and the Subsidiary
Guarantors, shall forthwith cause satisfaction and discharge of this Indenture
and  shall execute and deliver  to the Borrower  and the Subsidiary Guarantors
such  instruments as may be necessary, duly acknowledging the satisfaction and
discharge  of  this  Indenture and  forthwith  the  estate,  right, title  and
interest of the Trustee in and to any property held by it under this Indenture
or under  any Mortgage shall  thereupon cease, determine  and become  null and
void,  and  the Trustee  shall  transfer  the same  to  the  Borrower and  the
Subsidiary Guarantors.


Section 5.02.     Survival of Certain Obligations.

      Notwithstanding the  satisfaction and  discharge of this  Indenture, (a)
the  liabilities and obligations of the Borrower and the Subsidiary Guarantors
to the Trustee under Section 4.05 shall survive,  and (b) if the Borrower's or
either of the Subsidiary Guarantor's trustee in bankruptcy or any Person under
any applicable  bankruptcy law shall  recover all or  part of  the Obligations
payable hereunder  from the Trustee or  from any of the  Banks, this Indenture
and all  other Security Documents shall  be deemed not to  have been satisfied
and discharged but shall continue to be in full force and effect to the extent
of the amount so recovered.

                                   ARTICLE 6
                            SUPPLEMENTAL INDENTURES

Section 6.01.     Waivers and Supplemental Indentures with Consent of Banks.

      This  Indenture may  not be  waived,  modified, amended  or supplemented
without the prior written consent of the Agent or the Required Banks.

Section 6.02.     Execution of Supplemental Indentures.

      In  executing,  or  accepting  the  additional  trusts  created  by  any
indenture  supplemental hereto  or  the modifications  thereby  of the  trusts
created by  this Indenture,  the Trustee  shall  be entitled  to receive,  and
(subject to Sections 4.01 and 6.01)  shall be fully protected in relying upon,
an opinion  of counsel of the  Borrower and the Subsidiary  Guarantors stating
that the execution of  such Supplemental Indenture is authorized  or permitted
by this Indenture.  The Trustee may, but shall not be obligated to, enter into
any such Supplemental Indenture which affects the Trustee's own rights, duties
or immunities under this Indenture or otherwise.

Section 6.03.     Effect of Supplemental Indentures.

      Upon the execution of any indenture supplemental hereto,  this Indenture
shall be  modified in  accordance therewith, and  such Supplemental  Indenture
shall form a part of this Indenture for all purposes.

                                  ARTICLE 7
                  INSTRUCTIONS OF THE AGENT OR REQUIRED BANKS

Section 7.01.     Instructions of the Agent or Required Banks.

      (a)   Any  request, demand,  authorization, direction,  notice, consent,
waiver of or other  action required or permitted by this Indenture to be given
by  the  Agent  or  the  Required  Banks  (sometimes  referred  to  herein  as
"Instructions") shall be given  in accordance with Section 1.02.  The Trustee,
the Borrower  and the Subsidiary Guarantors  shall be entitled to  assume that
any Instructions so given have been duly authorized.  No instructions shall be
given which are in violation  of this Indenture (or the Credit  Agreement, the
Subsidiary  Guaranties or  any of  the Security Documents,  as defined  in the
Credit Agreement) or in violation of any applicable laws. 

      (b)   Unless  and  until the  Trustee  shall  have received  conflicting
Instructions  from the  Agent  or the  Required  Banks, any  request,  demand,
authorization, direction, notice, consent, waiver or other action by the Agent
or the  Required Banks shall bind the other Banks  in respect of anything done
or  suffered  to  be done  by  the  Indenture  Trustee,  the Borrower  or  the
Subsidiary Guarantors in reliance thereon.

                                   ARTICLE 8
                            LIMITATION OF LIABILITY

Section 8.01.     Limitation of Liability of Wilmington Trust Company.

      It is  expressly understood and  agreed by the parties  hereto that this
Indenture   is  executed  and  delivered  by   Wilmington  Trust  Company  not
individually  but solely  as  Indenture Trustee  and,  except as  provided  in
Section  4.01, nothing  contained herein  shall be  construed as  creating any
liability  on Wilmington  Trust Company  individually, including  any covenant
either express or implied herein, all such liability,  if any, being expressly
waived by all parties hereto.   


      IN WITNESS WHEREOF, the parties hereto  have caused this Indenture to be
duly executed on the day and year first above written.


                              READING & BATES DRILLING CO.


                              By:  ______________________________
                                    Title:

                              READING & BATES EXPLORATION CO.


                              By:  ________________________________
                                    Title:


                              HRB RIG CORPORATION


                              By:  _________________________________
                                    Title:


                              WILMINGTON  TRUST COMPANY, not in its individual
                              capacity but solely as Trustee  


                               By:  ______________________________
                                    Title:




                                ACKNOWLEDGEMENT



STATE OF NEW YORK       )
                        ) S.S.
COUNTY OF NEW YORK      )



On this 9th day of July, 1996 before me  personally appeared _________________
to me known who  being by me duly sworn did depose and  say that he resides at
___________________________, that he is __________________ for READING & BATES
DRILLING  CO., the corporation described  in and which  executed the foregoing
instrument;  and that he  signed his  name thereto  by order  of the  Board of
Directors of READING & BATES DRILLING CO.


                          __________________________
                                 Notary Public




                                ACKNOWLEDGEMENT



STATE OF NEW YORK       )
                        ) S.S.
COUNTY OF NEW YORK      )



On this  9th day of July, 1996 before me personally appeared _________________
to me known who  being by me duly sworn did depose and  say that he resides at
___________________________, that he is __________________ for READING & BATES
EXPLORATION CO., the corporation described in and which executed the foregoing
instrument; and  that he  signed his name  thereto by  order of  the Board  of
Directors of READING & BATES EXPLORATION CO.


                          __________________________
                                 Notary Public


                                ACKNOWLEDGEMENT



STATE OF NEW YORK       )
                        ) S.S.
COUNTY OF NEW YORK      )



On this  9th day of July, 1996 before me personally appeared _________________
to me known who  being by me duly sworn did depose and  say that he resides at
___________________________,  that  he  is  __________________  for  HRB   RIG
CORPORATION, the  corporation described in  and which  executed the  foregoing
instrument; and  that he signed  his name  thereto by  order of  the Board  of
Directors of HRB RIG CORPORATION.


                          __________________________
                                 Notary Public


                                ACKNOWLEDGEMENT



STATE OF DELAWARE       )
                        ) S.S.
COUNTY OF NEW CASTLE    )



On this 9th day of July,  1996 before me personally appeared _________________
to me known who  being by me duly sworn did depose and  say that he resides at
___________________________,  that  he  is __________________  for  WILMINGTON
TRUST COMPANY, the corporation  described in and which executed  the foregoing
instrument; and  that he  signed his  name thereto  by order of  the Board  of
Directors of WILMINGTON TRUST COMPANY.


                          __________________________
                                 Notary Public