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                       CRI-CAP(G) CHARGE OVER SHARES




                         CHAPARRAL RESOURCES, INC.
                                as Chargor


                                    and


                THE LAW DEBENTURE TRUST CORPORATION P.L.C.
                            as Security Trustee




                           Dated 7 February 2000


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                               WHITE & CASE
                               7-11 Moorgate
                              London EC2R 6HH



     THIS CHARGE OVER SHARES (this "Deed") is dated 7 February, 2000 and is
made as a Deed between:

     (1)  CHAPARRAL RESOURCES, INC., a company organised and existing under
the laws of the State of Delaware (the "Chargor"); and

     (2)  THE LAW DEBENTURE TRUST CORPORATION P.L.C., a company organised
and existing under the laws of England, acting as security trustee for the
Finance Parties (as defined below) (the "Security Trustee").

     WHEREAS:

     (A)  Pursuant to a loan agreement dated 1 November, 1999 (the "Loan
Agreement") between the Chargor, the Co-Obligors, Shell Capital Limited,
Shell Capital Services Limited and the Lenders (as such terms are defined
in the Loan Agreement), the Lenders have agreed to make available to the
Chargor secured loan facilities in an aggregate principal amount not
exceeding US$24,000,000 on the terms and subject to the conditions
contained in the Loan Agreement.

     (B)  At the request of the Facility Agent, the Security Trustee has
agreed to act as trustee under the Security Trust Deed and to hold the
benefit of the security constituted by or pursuant to the Security
Documents and the covenants and obligations of the Obligors under the
Security Documents on trust for the Finance Parties.

     (C)  It is a condition precedent to the first drawings under the Loan
Agreement that the Chargor and the Security Trustee have entered into this
Deed.

NOW IT IS AGREED AS FOLLOWS:

1.   DEFINITIONS AND INTERPRETATION

     1.1    DEFINITIONS

     Unless the context requires otherwise or a word or phrase is
differently defined in this Deed, words and phrases defined in the Loan
Agreement shall have, when used in this Deed (including the recitals), the
same meanings herein as therein and, in addition, in this Deed the
following terms have the meanings given to them in this Clause 1.1:

     "Act" means the Law of Property Act 1925.

     "Administration" means administration under Part II of the Insolvency
Act.

     "Attorney" means any person appointed as such by the Chargor pursuant
to Clause 21.1 (Appointment).

     "Charge" means the Security Interests created by, or pursuant to, this
Deed.

     "Charged Assets" means the Shares and Derivative Assets.

     "Default Rate" has the meaning set out in section 19.2(a) of the Loan
Agreement.

     "Delegate" means a delegate or sub-delegate appointed pursuant to
Clause 13.5 (Delegation).

     "Derivative Assets" means:

     (a)  allotments, rights, money or property arising from the Shares by
          way of conversion, exchange, redemption, bonus, preference,
          option or otherwise;

     (b)  dividends, distributions, interest and other income from the
          Shares; and

     (c)  stock, shares and securities offered in addition to, or in
          substitution for, the Shares.

     "Dissolution" of a person includes the bankruptcy, insolvency,
liquidation, amalgamation, reconstruction, reorganisation, Administration,
administrative or other receivership, or dissolution of that person, and
any equivalent or analogous proceedings by whatever name known and in
whatever jurisdiction, and any step taken (including, but without
limitation, the presentation of a petition or the passing of a resolution)
for or with a view to any of the foregoing.

     "Insolvency Act" means the Insolvency Act 1986.

     "Original Shares" means the 400,000 shares of common stock, par value
US$1.00 per share, of the Principal Company owned by the Chargor on the
date of this Deed.

     "Principal Company" means Central Asian Petroleum (Guernsey) Limited,
a company organised and existing under the laws of Guernsey.

     "proceedings" shall have the meaning ascribed thereto in Clause 29.2
(Jurisdiction).

     "Receiver" means a receiver and manager or other receiver appointed in
respect of the Charged Assets under this Deed or the Act.

     "Rights" means rights, benefits, powers, privileges, authorities,
discretions, remedies, easements, quasi-easements and appurtenances (in
each case, of any nature whatsoever).

     "Secured Liabilities" means all moneys and liabilities (whether actual
or contingent) which are now or may at any time hereafter be due, owing or
payable to any of the Finance Parties from or by the Obligors under or in
connection with (i) the Loan Agreement, (ii) this Deed, or (iii) any other
Finance Document, together with all legal and other costs, charges and
expenses which any of the Finance Parties may incur in enforcing or
obtaining, or attempting to enforce or obtain, payment of any such moneys
and liabilities.

     "Shares" means the Original Shares and all other shares in the
Principal Company owned by the Chargor from time to time.

     "Tax" includes any present or future tax (including value added tax),
levy, impost, duty, charge, fee, deduction or withholding of any nature,
and any interest or penalty in respect thereof.

     1.2    INTERPRETATION

     In this Deed, unless the context requires otherwise:

     (a)  references to Clauses and Schedules are to clauses of, and
     schedules to, this Deed;

     (b)  headings to Clauses are for convenience only and are to be
     ignored in construing this Deed;

     (c)  subject to Clause 12.1 (Powers), references to a statute shall be
     construed as a reference to such statute as from time to time amended
     or re-enacted;

     (d)  any reference to any English legal term for any action, remedy,
     method of judicial proceeding, legal document, legal status, court,
     official or any legal concept or thing shall, in respect of a
     jurisdiction other than England, be deemed to include that which most
     nearly approximates in that jurisdiction to the English legal term;

     (e)  any reference to the "Charged Assets" shall be a reference to all
     the Charged Assets and/or to each and every part of the Charged Assets
     and reference to any other defined term or noun in the plural number
     or collective plural shall be interpreted MUTATIS MUTANDIS in the same
     manner; and

     (f)  references in this Deed to this "Deed" or any other deed,
     agreement or instrument including, without limitation, the Loan
     Agreement, are references to this Deed or, as the case may be, the
     relevant deed, agreement or instrument as amended, supplemented,
     replaced or novated from time to time and include references to any
     document which amends, supplements, replaces, novates or is entered
     into, made or given pursuant to, or in accordance with, any of the
     terms of this Deed or, as the case may be, the relevant deed,
     agreement or instrument.

2.   COVENANT TO DISCHARGE OBLIGATIONS

     2.1    COVENANT TO PAY

     The Chargor covenants with the Security Trustee that it will on demand
pay and discharge the Secured Liabilities at the time or times when due.

     2.2    VALIDITY OF DEMANDS

     Any person dealing with the Security Trustee or any Receiver shall not
be concerned to see or enquire as to the validity of any demand made under
this Deed.

3.   SECURITY

     3.1    CHARGING PROVISIONS

     The Chargor, with full title guarantee and as continuing security for
the payment and discharge of the Secured Liabilities, charges the Charged
Assets by way of first fixed charge in favour of the Security Trustee for
the benefit of the Finance Parties.

     3.2    OBLIGATION TO DEPOSIT CERTIFICATES RELATING TO ORIGINAL SHARES

     The Chargor shall promptly deposit with the Security Trustee on the
date hereof all certificates and documents of title (if any) relating to
the Charged Assets in certificated form together with undated share
transfer forms executed in blank by the Chargor and such other documents as
the Security Trustee may require to perfect title to the Charged Assets
(duly executed by the registered holder) or for vesting or enabling the
Security Trustee to vest the same in itself, its nominees or any purchaser.
The Security Trustee may at any time, without notice to the Chargor,
complete such transfers and present them for registration.

     3.3    OBLIGATION TO DEPOSIT CERTIFICATES RELATING TO DERIVATIVE
            ASSETS

     Subject to Clause 7 (Voting Rights, Dividends, etc), the Chargor
shall, upon the accrual, offer, issue or receipt of any Derivative Assets,
deliver or pay to the Security Trustee or procure the delivery or payment
to the Security Trustee of all such Derivative Assets together with the
stock or share certificates or other documents of title to or representing
them and undated transfers executed in blank and such other documents as
the Security Trustee may require to perfect title to the Derivative Assets
(duly executed by the registered holder) or for vesting or enabling the
Security Trustee to vest the same in itself, its nominees or any purchaser.
The Security Trustee may, at any time, without notice to the Chargor,
complete such transfers and present them for registration.

4.   RESTRICTIONS ON DEALING WITH CHARGED ASSETS

     4.1    NEGATIVE PLEDGE

     The Chargor shall not, without the prior written consent of the
Security Trustee, create or permit to subsist any Security Interest on,
over, or with respect to, the Charged Assets except for the Permitted
Security Interests.

     4.2    DISPOSAL OF CHARGED ASSETS

     The Chargor shall not, without the prior written consent of the
Security Trustee, sell, transfer, alienate or deal with the Charged Assets
or any interest in the Charged Assets or attempt or agree to do so.

     4.3    CHANGE IN CHARGED ASSETS

     The Chargor shall not, without the prior written consent of the
Security Trustee, cause or permit the Charged Assets to be consolidated,
sub-divided or converted, and shall take such action as the Security
Trustee may direct in respect of any proposed compromise, arrangement,
capital reorganisation, conversion, exchange, repayment or takeover offer
affecting the Charged Assets or any proposal to vary or abrogate any rights
attaching to the Charged Assets.

5.   GENERAL COVENANTS

     5.1    OBLIGATIONS RELATING TO CHARGED ASSETS

     The Chargor shall remain liable to observe and perform all conditions
and obligations assumed by it in respect of the Charged Assets, and shall
in particular duly and promptly pay and indemnify the Security Trustee (or
the Security Trustee's nominee) against all costs and other moneys which
may lawfully be required to be paid by the Security Trustee in respect of
the Charged Assets.

     5.2    NOTICES RECEIVED RELATING TO CHARGED ASSETS

     The Chargor shall, forthwith upon receipt by it or its nominee from
any third party of any notices, reports, accounts, circulars or other
matters whatsoever relating to or affecting or likely to affect the Charged
Assets, give full particulars thereof and (if required) produce the same to
the Security Trustee and, if appropriate, will, at the cost of the Chargor,
forthwith either comply with the same or will, at the request of the
Security Trustee and at the Chargor's cost, make or join with the Security
Trustee in making such objections or representations against, or in respect
of, any such notices, reports, accounts, circulars or other matters as
aforesaid as the Security Trustee shall deem expedient.

     5.3    NOTATION IN STATUTORY BOOKS

     The Chargor shall procure that, on the date hereof, particulars of the
Security Interests created hereby be registered in the appropriate register
maintained in the book of registered shareholders of the Principal Company
maintained by the Principal Company and the Chargor shall provide the
Security Trustee with a true copy of such book of registered shareholders.

     5.4    INDEMNITY

     Without prejudice to the provisions of Clause 5.1 (Obligations
Relating to Charged Assets), the Chargor shall keep the Security Trustee
(and any Receiver appointed by the Security Trustee) at all times fully and
effectively indemnified from and against all actions, proceedings, costs,
charges, claims, demands, expenses, liabilities, legal and other
professional fees (including, without prejudice to the generality of the
foregoing, any Tax) whatsoever in respect of any breach, non-observance or
non- performance of any covenants, obligations, warranties or undertakings
on the part of the Chargor contained in this Deed or the making good of any
such breach, non-observance or non-performance.

6.   REPRESENTATIONS AND WARRANTIES

     6.1    REPEATED REPRESENTATIONS AND WARRANTIES

     The Chargor represents and warrants to the Security Trustee, as at the
date of this Deed and on each other day on which the representations and
warranties set out in the Loan Agreement are to be repeated, that:

     (a)  it is and will be the sole, absolute and beneficial owner and the
     registered holder of the Charged Assets free from Security Interests
     other than Permitted Security Interests;

     (b)  the Shares are and will at all times be fully paid and there are
     and will be no moneys or liabilities outstanding in respect of any of
     the Shares;

     (c)  the Shares have each been duly authorised and validly issued and
     are and will at all times be free from any restriction on transfer or
     rights of pre-emption;

     (d)  it has the necessary corporate power and authorisation to enter
     into and perform its obligations under this Deed and no further act on
     the part of the Chargor is necessary to enable the Chargor to enter
     into and to perform its obligations under this Deed;

     (e)  this Deed constitutes its legal, valid, binding and enforceable
     obligation and is a first fixed charge over the Charged Assets
     effective in accordance with the terms of this Deed;

     (f)  the Charge does not and will not conflict with, or result in any
     breach of, or constitute a default under, any agreement, instrument or
     obligation to which the Chargor is a party or by which it is, or the
     Charged Assets are, bound; and

     (g)  all necessary authorisations and consents to enable or entitle it
     to enter into this Deed have been obtained.

     6.2    OTHER REPRESENTATIONS AND WARRANTIES

     The Chargor represents and warrants to the Security Trustee that, as
at the date of this Deed, the Principal Company's issued and outstanding
capital stock consists of 500,000 shares of common stock, par value US$1.00
per share.

7.   VOTING RIGHTS, DIVIDENDS, ETC.

     7.1    BEFORE THE CHARGE BECOMES ENFORCEABLE

     Until the Charge shall become enforceable:

     (a)  all voting and other Rights relating to the Charged Assets may be
     exercised by the Chargor, or shall be exercised in accordance with its
     direction, for any purpose not inconsistent with the terms of this
     Deed; and

     (b)  all dividends, interest and other distributions paid to the
     Chargor in respect of the Charged Assets shall be paid to the CRI
     Receipts Account.

     7.2    AFTER THE CHARGE BECOMES ENFORCEABLE

     If the Charge shall become enforceable:

     (a)  the Security Trustee or, as the case may be, the Receiver shall
     be entitled to exercise or direct the exercise of all voting and other
     Rights now or at any time relating to the Charged Assets;

     (b)  the Chargor shall comply or procure the compliance with any
     direction of the Security Trustee or, as the case may be, the Receiver
     in respect of the exercise of the voting and other Rights referred to
     in Clause 7.2(a) and shall deliver to the Security Trustee or, as the
     case may be, the Receiver such forms of proxy or other appropriate
     forms of authorisation to enable the Security Trustee or, as the case
     may be, the Receiver to exercise such voting and other Rights relating
     to the Charged Assets;

     (c)  the Security Trustee shall be entitled to receive and retain all
     dividends, interest and other distributions paid in respect of the
     Charged Assets and apply them in or towards the payment or discharge
     of the Secured Liabilities; and

     (d)  all Derivative Assets shall, if received by the Chargor, be held
     on trust for, and forthwith paid or transferred to, the Security
     Trustee.

8.   SECURITY TRUSTEE'S DISCRETION

     8.1    SECURITY TRUSTEE MAY CURE BREACHES OF COVENANTS

     In the event of the failure of the Chargor to observe or perform the
provisions of this Deed, the Security Trustee may do all such acts and
things as may be necessary to secure the observance or performance thereof
without thereby becoming liable as a mortgagee in possession.

     8.2    EXPENSES SO INCURRED

     The Chargor hereby agrees and acknowledges that all moneys expended
and all costs incurred by the Security Trustee in carrying out any of its
discretions or powers referred to in Clause 8.1 (Security Trustee May Cure
Breaches of Covenants) shall be considered to have been properly incurred
by the Security Trustee and shall be recoverable from the Chargor under
Clause 25 (Costs and Expenses).

9.   FURTHER ASSURANCES

     9.1    GENERAL ASSURANCE

     The Chargor shall, at its own cost, promptly execute and do all such
assurances, acts and things in such form as the Security Trustee may from
time to time require for perfecting, preserving or protecting the Charge or
the priority thereof and for facilitating the realisation of the Charged
Assets or the exercise of any Rights vested in the Security Trustee or in
any Receiver, and the Chargor shall, in particular but without limitation,
execute all such transfers, conveyances, assignments and assurances of the
Charged Assets whether to the Security Trustee or to its nominees or
otherwise, and give all such notices, orders, instructions and directions
which the Security Trustee may consider expedient.

     9.2    ADDITIONAL SECURITY INTERESTS

     Without prejudice to the generality of Clause 9.1 (General Assurance),
the Chargor shall, at its own cost, promptly execute and deliver to the
Security Trustee in such form as the Security Trustee may require such
other Security Interests over such of the Charged Assets as shall be
required by the Security Trustee (whether generally or specifically, and
whether for the purpose of obtaining legal title to the relevant Charged
Assets, creating Security Interests which are effective under the laws of a
foreign jurisdiction, or otherwise).

10.  ENFORCEMENT

     10.1   CHARGE TO BECOME ENFORCEABLE

     The Charge shall become enforceable at any time after the occurrence
and during the continuance of an Event of Default, and immediately
thereafter the powers conferred upon the Security Trustee by section 101 of
the Act as varied and extended by this Deed shall be exercisable without
the restrictions imposed by section 103 of the Act as to the giving of
notice or otherwise.

     10.2   SECTION 101 OF THE ACT

     The powers conferred by section 101 of the Act, as varied and extended
by this Deed, shall be deemed to have arisen immediately on the execution
of this Deed.

     10.3   SECTIONS 93 AND 103 OF THE ACT

     Sections 93 and 103 of the Act shall not apply to this Deed.

     10.4   ADDITIONAL RIGHTS OF SECURED TRUSTEE ON ENFORCEMENT

     At any time at which the Charge shall be enforceable, the Security
Trustee shall have the right without any notice to or consent of the
Chargor:

     (a)  to take possession of, collect and get in the Charged Assets, and
     in particular, but without limitation, to take any steps necessary to
     vest all or any of the Charged Assets in the name of the Security
     Trustee or its nominee and to receive and retain any dividends
     deriving from the Charged Assets;

     (b)  to sell, exchange, convert into money or otherwise dispose of or
     realise the Charged Assets (whether by public offer or private
     contract) to any person and for such consideration (whether comprising
     cash, debentures or other obligations, shares or other valuable
     consideration of any kind) and on such terms (whether payable or
     deliverable in a lump sum or by instalments) as the Security Trustee
     may think fit, and for this purpose to complete any transfers of the
     Charged Assets;

     (c)  to settle, adjust, refer to arbitration, compromise and arrange
     any claims, accounts, disputes, questions and demands relating in any
     way to the Charged Assets;

     (d)  to bring, prosecute, enforce, defend and abandon actions, suits
     and proceedings in relation to the Charged Assets; and

     (e)  to do all such other acts and things it may consider necessary or
     expedient for the realisation of the Charged Assets or incidental to
     the exercise of any Rights conferred on it under or in connection with
     this Deed or the Act and to concur in the doing of anything which it
     has the right to do and to do any such thing jointly with any other
     person.

11.  APPOINTMENT OF RECEIVERS

     11.1   APPOINTMENT

     At any time after the Charge has become enforceable (whether or not
the Security Trustee shall have taken possession of the Charged Assets), at
the request of the Chargor, or following the Dissolution of the Chargor,
without any or further notice, the Security Trustee may, by deed or writing
signed by any officer or manager of the Security Trustee or any person
authorised for this purpose by the Security Trustee, appoint any person to
be Receiver, and may similarly remove any Receiver whether or not it
appoints any person in his place. If the Security Trustee appoints more
than one person as Receiver, the Security Trustee may give the relevant
persons power to act either jointly or severally.

     11.2   SCOPE OF APPOINTMENT

     Any Receiver may be appointed either Receiver of all the Charged
Assets or Receiver of such part of the Charged Assets as may be specified
in the appointment. In the latter case, the Rights conferred on a Receiver
by Clause 12 (Receivers) shall have effect as though every reference in
that Clause to the "Charged Assets" were a reference to the part of the
Charged Assets so specified or any part thereof.

12.  RECEIVERS

     12.1   POWERS

     Any Receiver appointed under this Deed shall (subject to any contrary
provision specified in his appointment) have the powers granted to a
receiver under section 109 of the Act (as in force at the date of this
Deed) and the powers which are granted to an administrative receiver as
listed in Schedule 1 to the Insolvency Act (as in force at the date of this
Deed) and, in addition shall have the right, either in his own name or in
the name of the Chargor or otherwise and in such manner and upon such terms
and conditions as the Receiver thinks fit:

     (a)  in connection with any sale or disposition of the Charged Assets,
     to receive the consideration therefor in a lump sum or in instalments
     and to receive shares by way of consideration;

     (b)  to grant options, licences or any other interest whatsoever in
     relation to the Charged Assets;

     (c)  to do all other acts and things which he may consider desirable
     or necessary for realising the Charged Assets or incidental or
     conducive to any of the rights, powers or discretions conferred on a
     Receiver under or by virtue of this Deed; and

     (d)  to exercise in relation to the Charged Assets all the powers,
     authorities and things which he would be capable of exercising if he
     were the absolute beneficial owner of the same.

     12.2   CONFLICT

     If there is any ambiguity or conflict between the powers conferred on
the Receiver by the Act or by Schedule 1 of the Insolvency Act and the
powers conferred by Clause 12.1 (Powers), the powers conferred by Clause
12.1 (Powers) shall prevail.

     12.3   AGENT OF CHARGOR

     Any Receiver shall be the agent of the Chargor for all purposes and
the Chargor shall be solely responsible for his contracts, engagements,
acts, omissions, defaults and losses and for all liabilities incurred by
him.

     12.4   REMUNERATION

     Subject to section 36 of the Insolvency Act, the Security Trustee may,
from time to time, determine the remuneration of any Receiver (without
being limited to the maximum rate specified in section 109(6) of the Act)
and may direct payment of such remuneration out of moneys accruing to him
as Receiver but the Chargor alone shall be liable for the payment of such
remuneration and for all other costs, charges and expenses of the Receiver.

13.  RIGHTS OF SECURITY TRUSTEE

     13.1   RIGHTS OF RECEIVER

     Any Rights conferred by this Deed upon a Receiver may be exercised by
the Security Trustee after the Charge has become enforceable, irrespective
of whether the Security Trustee has taken possession of the Charged Assets
or appointed a Receiver.

     13.2   REDEMPTION OF PRIOR SECURITY INTERESTS

     The Security Trustee may, at any time, redeem any Security Interests
over the Charged Assets having priority to the Charge or procure the
transfer thereof to the Security Trustee and may settle the accounts of
encumbrancers.  Any accounts so settled shall, in the absence of manifest
error, be conclusive and binding on the Chargor. The Chargor shall, on
demand, pay to the Security Trustee all principal moneys, interest, costs,
charges, losses, liabilities and expenses of, and incidental to, any such
redemption by or transfer to the Security Trustee.

     13.3   SUSPENSE ACCOUNT

     The Security Trustee may, for as long as the Secured Liabilities, for
which any other person may be liable as principal debtor or as co-surety
with the Chargor, have not been paid or discharged in full, acting on the
instructions of the Facility Agent, place and retain on an interest-bearing
suspense account, for as long as it considers fit, any moneys received,
recovered or realised under, or in connection with, this Deed to the extent
of such Secured Liabilities without any obligation on the part of the
Security Trustee to apply the same in or towards the discharge of such
Secured Liabilities.

     13.4   NEW ACCOUNT

     At any time following (i) the Security Trustee's having received
notice (either actual or constructive) of any subsequent Security Interests
affecting the Charged Assets or (ii) the Dissolution of the Chargor, the
Security Trustee may open a new account in the name of the Chargor (whether
or not it permits any existing account to continue). If the Security
Trustee does not open such a new account, it shall nevertheless be treated
as if it had done so at the time when the notice was received or was deemed
to have been received or, as the case may be, the Dissolution commenced.
Thereafter, all payments made by the Chargor to the Security Trustee or
received by the Security Trustee for the account of the Chargor shall be
credited or treated as having been credited to the new account and shall
not operate to reduce the amount secured by this Deed at the time when the
Security Trustee received or was deemed to have received such notice or, as
the case may be, the Dissolution commenced.

     13.5   DELEGATION

     The Security Trustee may delegate in any manner to any person any of
the Rights which is for the time being exercisable by the Security Trustee
under this Deed. Any such delegation may be made upon such terms and
conditions (including without limitation power to sub-delegate) as the
Security Trustee may think fit.

     13.6   SET-OFF

     The Security Trustee may, without notice to the Chargor and without
prejudice to any of the Security Trustee's other Rights, set off any
Secured Liabilities which are due and unpaid against any obligation
(whether or not matured) owed by a Finance Party to the Chargor, regardless
of the place of payment or booking branch, and for that purpose that
Finance Party may convert one currency into another at the market rate of
exchange which may be obtained by that Finance Party in the usual course of
business of that Finance Party on the date of set-off.

14.  APPLICATION OF MONEYS

     All moneys arising from the exercise of the powers of enforcement
under this Deed shall (except as may be otherwise required by applicable
law) be held and applied in the following order of priority (but without
prejudice to the right of the Security Trustee to recover any shortfall
from the Chargor):

     (a)  FIRSTLY, in or towards payment of all costs, charges, losses,
     liabilities and expenses of, and incidental to, the appointment of any
     Receiver and the exercise of its Rights including its remuneration and
     all outgoings paid by it;

     (b)  SECONDLY, in or towards the payment and discharge of such of the
     Secured Liabilities in such order as the Security Trustee in its
     absolute discretion may from time to time determine; and

     (c)  THIRDLY, after all the Secured Liabilities have been paid or
     discharged in full, in payment of any surplus to the Chargor.

15.  LIABILITY OF SECURITY TRUSTEE, RECEIVERS AND DELEGATES

     15.1   POSSESSION

     If the Security Trustee, any Receiver or any Delegate shall take
possession of the Charged Assets it or he may at any time relinquish such
possession.

     15.2   SECURITY TRUSTEE'S LIABILITY

     The Security Trustee shall not, in any circumstances (whether by
reason of taking possession of the Charged Assets or for any other reason
whatsoever and whether as mortgagee in possession or on any other basis
whatsoever), be liable:

     (a)  to account to the Chargor or any other person for anything except
     the Security Trustee's own actual receipts; or

     (b)  to the Chargor or any other person for any costs, charges,
     losses, damages, liabilities or expenses arising from, or connected
     with, any realisation of the Charged Assets or from any act, default,
     omission or misconduct of the Security Trustee, its officers,
     employees or agents in relation to the Charged Assets.

     15.3   RECEIVER'S LIABILITY

     All the provisions of Clause 15.2 (Security Trustee's Liability) shall
apply, MUTATIS MUTANDIS, in respect of the liability of any Receiver or
Delegate or any officer, employee or agent of the Security Trustee, any
Receiver or any Delegate.

     15.4   INDEMNITY

     The Security Trustee and every Receiver, Delegate, attorney, manager,
agent or other person appointed by the Security Trustee hereunder shall be
entitled to be indemnified out of the Charged Assets in respect of all
liabilities and expenses incurred by any of them in the execution or
purported execution of any of their respective Rights and against all
actions, proceedings, costs, claims and demands in respect of any matter or
thing done or omitted in any way relating to the Charged Assets, and the
Security Trustee and any such Receiver, Delegate, attorney, manager, agent
or other person appointed by the Security Trustee hereunder may retain and
pay all sums in respect of the same out of any moneys received.

16.  PROTECTION OF THIRD PARTIES

     16.1   CONTRACTUAL PROTECTION

     No person dealing with the Security Trustee, any Receiver or any
Delegate shall be concerned to enquire:

     (a)  whether any event has happened upon which any of the Rights
     conferred under or in connection with this Deed, the Act or the
     Insolvency Act is or may be exercisable, or

     (b)  whether any consents, regulations, restrictions or directions
     relating to such Rights have been obtained or complied with; or

     (c)  as to the propriety or regularity of acts purporting or intended
     to be in exercise of any such Rights; or

     (d)  as to the application of any money borrowed or raised; or

     (e)  as to the application of the proceeds of enforcement.

     16.2   STATUTORY PROTECTION

     All the protections to purchasers contained in sections 104 and 107 of
the Act, section 42(3) of the Insolvency Act or in any other applicable
legislation shall apply to any person purchasing from, or dealing with, the
Security Trustee, any Receiver or any Delegate.

17.  CONTINUING SECURITY INTERESTS AND OTHER MATTERS

     17.1   CONTINUING AND INDEPENDENT SECURITY INTEREST

     The Charge shall be a continuing and independent Security Interest for
the Secured Liabilities and shall not be satisfied, discharged or affected
by any intermediate payment or settlement of account (whether or not any
Secured Liabilities remain outstanding thereafter) or any other matter or
thing whatsoever.

     17.2   PRIMARY OBLIGATIONS

     This Deed and the Charge constitute original, independent and absolute
securities (and not secondary or collateral securities) for the Secured
Liabilities.

18.  ADDITIONAL SECURITY INTERESTS

     The Charge shall be in addition to, and shall not be prejudiced by,
any other Security Interests or any guarantee or indemnity or other
document which any Finance Party may, at any time, hold for the payment and
discharge of the Secured Liabilities.

19.  CHARGE NOT TO BE AFFECTED

     Without prejudice to Clause 17 (Continuing Security Interests and
Other Matters) and Clause 18 (Additional Security Interests), neither the
Charge nor the liability of the Chargor for the Secured Liabilities shall
be prejudiced or affected by:

     (a)  any variation or amendment of, or waiver or release granted
     under, or in connection with, any other Security Interests or any
     guarantee or indemnity or other document;

     (b)  time being given, or any other indulgence or concession being
     granted, by the Security Trustee to an Obligor or any other person;

     (c)  the taking, holding, failure to take or hold, varying,
     realisation, non-enforcement, non-perfection or release by the
     Security Trustee or any other person of any other Security Interests,
     or any guarantee or indemnity;

     (d)  the Dissolution of an Obligor or any other person;

     (e)  any change in the constitution of an Obligor;

     (f)  any amalgamation, merger or reconstruction that may be effected
     by the Security Trustee with any other person or any sale or transfer
     of the whole or any part of the assets of the Security Trustee to any
     other person;

     (g)  the existence of any claim, set-off or other right which an
     Obligor may have at any time against the Security Trustee, any other
     Finance Party or any other person;

     (h)  the making or absence of any demand for payment of the Secured
     Liabilities on an Obligor or any other person, whether by the Security
     Trustee, any other Finance Party or any other person;

     (i)  any arrangement or compromise entered into by the Security
     Trustee or any other Finance Party with an Obligor or any other
     person; or

     (j)  any other thing done or omitted or neglected to be done by the
     Security Trustee, any other Finance Party or any other person or any
     other dealing, fact, matter or thing which, but for this provision,
     might operate to prejudice or affect the liability of an Obligor for
     the Secured Liabilities.

20.  RELEASE OF CHARGED ASSETS

     20.1   RELEASE OF CHARGED ASSETS

     If the Security Trustee is satisfied, acting upon the instructions of
the Facility Agent, that:

     (a)  all Secured Liabilities have been irrevocably paid or discharged
     in full and that none of the Finance Parties is under any further
     obligation (contingent or otherwise) to provide any banking or other
     accommodation to any Obligor under the Finance Documents; or

     (b)  Security Interests or a guarantee for the Secured Liabilities, in
     each case acceptable to the Security Trustee, has been provided in
     substitution for this Deed,

then, subject to Clause 20.2 (Retention of This Deed), the Security Trustee
shall, at the request and cost of the Chargor, execute such deeds and do
all such acts and things as may be necessary to release the Charged Assets
from the Charge.

     20.2   RETENTION OF THIS DEED

     If the Chargor requests the Security Trustee to release the Charged
Assets from the Charge following any payment or discharge of the Secured
Liabilities by a person other than the Chargor (a "Relevant Transaction"),
the Security Trustee shall at the cost of the Chargor execute such
documents and deeds and do all such acts and things as may be necessary to
release the Charged Assets from the Charge provided the Security Trustee is
satisfied that the payment or discharge will not be avoided, reduced or
invalidated.  If the Security Trustee is not so satisfied, the Security
Trustee shall be entitled to retain this Deed and shall not be obliged to
release the Charged Assets from the Charge until the expiry of the
Retention Period (being the period which commences on the date when that
Relevant Transaction was made or given, and ends on the date falling one
month after the expiration of the maximum period within which that Relevant
Transaction can be avoided, reduced or invalidated by virtue of any
applicable law or for any other reason whatsoever) in relation to that
Relevant Transaction. If, at any time before the expiry of that Retention
Period, the Dissolution of such other person shall have commenced, the
Security Trustee may continue to retain this Deed and shall not be obliged
to release the Charged Assets from the Charge for such further period as
the Security Trustee may determine.

21.  POWER OF ATTORNEY

     21.1   APPOINTMENT

     The Chargor appoints, irrevocably and by way of security, the Security
Trustee, every Receiver and every Delegate severally to be the Attorney of
the Chargor (with full powers of substitution and delegation), on its
behalf and in its name or otherwise, at such time and in such manner as the
Attorney may think fit:

     (a)  to do anything which the Chargor is obliged to do (but has not
     done) under this Deed including, but without limitation, to complete
     and execute any transfer of, or Security Interests over, the Charged
     Assets; and

     (b)  generally to exercise the Rights conferred on the Security
     Trustee, every Receiver or every Delegate in relation to the Charged
     Assets or under, or in connection with, this Deed, the Act or the
     Insolvency Act.

     21.2   RATIFICATION

     The Chargor covenants to ratify and confirm whatever any Attorney
shall do or purport to do in the exercise or purported exercise of the
Power of Attorney in Clause 21.1 (Appointment).

22.  CURRENCY INDEMNITY

     If the Security Trustee receives an amount in respect of the Chargor's
liability under this Deed or if that liability is converted into a claim,
proof, judgment or order in a currency other than Dollars:

     (a)  the Chargor shall as an independent obligation indemnify the
     Security Trustee against any loss or liability arising out of or as a
     result of the conversion;

     (b)  if the amount received by the Security Trustee, when converted
     into Dollars at a market rate in the usual course of its business and
     after expenses and commissions is less than the amount owed by the
     Chargor to the Security Trustee in Dollars, the Chargor shall
     forthwith on demand pay to the Security Trustee an amount in Dollars
     equal to the deficit; and

     (c)  the Chargor shall pay to the Security Trustee on demand any
     exchange costs and taxes payable in connection with any such
     conversion.

     The Chargor waives any right it may have in any jurisdiction to pay
any amount under this Deed in a currency other than that in which such
amount is expressed to be payable.

23.  DEFAULT INTEREST

     If the Chargor fails to pay any Secured Liability on the due date for
payment, the Chargor shall pay to the Security Trustee on demand interest
at the Default Rate from:

     (a)  in the case of costs, charges, losses, liabilities, expenses and
     other sums referred to in Clause 25 (Costs and Expenses), the date on
     which the relevant cost, charge, loss, liability, expense or sum was
     expended, paid or debited on account by the Security Trustee without
     the necessity of any demand being made for payment thereof; or

     (b)  in any other case, the date on which the relevant Secured
     Liability became due,

until full payment and discharge of the relevant Secured Liability (both
before and after any judgment).

24.  CERTIFICATES TO BE CONCLUSIVE EVIDENCE

     For all purposes, including any proceedings, a copy of a certificate
signed by an officer of the Security Trustee as to the amount of any
indebtedness comprised in the Secured Liabilities or as to any applicable
rate of interest shall, in the absence of manifest error, be conclusive
evidence against the Chargor as to the amount or rate of such indebtedness.

25.  COSTS AND EXPENSES

     25.1   TRANSACTION COSTS

     The Chargor shall, on written demand (accompanied by copies of the
invoices therefor), pay to the Security Trustee all legal and other fees on
a full indemnity basis (including without limitation, all printing,
translation, communication, advertising, travel and other out-of-pocket
expenses) properly incurred by the Security Trustee in connection with the
negotiation, preparation and execution of this Deed, the completion of the
transactions contemplated in this Deed, any amendment of this Deed and any
calculation, approval, consent or waiver to be made or given by the
Security Trustee pursuant to or in respect of any provision of this Deed.

     25.2   PRESERVATION AND ENFORCEMENT COSTS

     The Chargor  shall, from time to time on demand pay to the Security
Trustee all costs and expenses (including without limitation legal and
other fees on a full indemnity basis and printing, translation,
communication, advertisement, travel and all other out-of-pocket expenses)
incurred in or in connection with the preservation and/or enforcement (or
attempted preservation and/or enforcement) of any right of the Security
Trustee under this Deed.

     25.3   STAMP TAXES

     The Chargor shall pay all stamp, registration and other taxes and
duties, and all notarial registration, recording and other like fees to
which this Deed or any judgment given in connection with this Deed is, or
at any time may be, subject and shall on demand indemnify the Security
Trustee against any liabilities, costs, claims and expenses resulting from
any failure to pay or any delay in paying any such tax or duty or fees.

     25.4   SECURITY TRUSTEE'S ADDITIONAL COSTS

     The Chargor shall, from time to time on demand of the Security Trustee
(and without prejudice to the provisions of Clause 25.1 (Transaction Costs)
and 25.2 (Preservation and Enforcement Costs) compensate the Security
Trustee at such daily and/or hourly rates as the Security Trustee shall
from time to time determine and on demand indemnify the Security Trustee
against all costs and expenses (including, without limitation, telephone,
fax, copying, travel and personnel costs) properly incurred by the Security
Trustee in connection with its taking such action as it may deem
appropriate or in complying with any instructions from the Finance Parties
or any request by the Chargor in connection with:

     (a)  the granting or proposed granting of any waiver or consent
     requested by the Chargor under this Deed;

     (b)  any actual, potential or suspected breach by the Chargor of its
     obligations under this Deed;

     (c)  the occurrence of an Event of Default or a Potential Event of
     Default; or

     (d)  any amendment or proposed amendment to this Deed requested by the
     Chargor.

     25.5   TAX

     Any fee, cost or expense referred to in this Clause 25 (Costs and
Expenses) is exclusive of any Tax chargeable in connection with that fee,
cost or expense. The Chargor shall pay any Tax so chargeable at the same
time as it pays the relevant fee, cost or expense.

26.  NOTICES

     26.1   GIVING OF NOTICES

     All notices or other communications shall be in writing addressed to
the relevant party. A written notice includes a facsimile transmission. Any
such notice shall be deemed to be given as follows:

     (a)  if by personal delivery or letter, when delivered; and

     (b)  if by facsimile, when the answerback is received.

     However, a notice given in accordance with the above but received on a
non-working day or after business hours in the place of receipt shall only
be deemed to be given on the next working day in that place.

     26.2   ADDRESSES FOR NOTICES

     (a)  The address and facsimile number of the Security Trustee are:

          The Law Debenture Trust Corporation p.l.c.
          Princes House, 95 Gresham Street
          London EC2V 7LY

          Attention:     The Manager, Trust Management
          Facsimile:     44 (0)20 7696 5261/7606 0643

     or such other as the Security Trustee may notify to the Chargor by not
     less than five Business Days' notice.

     (b)  The address and facsimile number of the Chargor are:

          Chaparral Resources, Inc.
          16945 Northchase Drive, Suite 1440
          Houston, Texas 77060, USA

          Attention:     President
          Facsimile:     (281) 877 0985

     or such other as the Chargor may notify to the Security Trustee by not
     less than five Business Days' notice.

     26.3   ENGLISH LANGUAGE

     Each communication and document made or delivered by one party to
another pursuant to this Deed shall be in the English language or
accompanied by a translation thereof into English certified (by an officer
of the person making or delivering the same) as being a true and accurate
translation thereof.

27.  REMEDIES AND WAIVERS, PARTIAL INVALIDITY

     27.1   REMEDIES AND WAIVERS

     Time is of the essence of the Chargor's obligations under this Deed
but no failure to exercise, nor any delay in exercising, on the part of the
Security Trustee, any right or remedy under this Deed shall operate as a
waiver thereof, nor shall any single or partial exercise of any right or
remedy prevent any further or other exercise thereof or the exercise of any
other right or remedy. The rights and remedies contained in this Deed are
cumulative and not exclusive of any rights or remedies provided by law.
The Security Trustee may agree to any waiver of any of its rights or
remedies under this Deed on such terms as it sees fit.

     27.2   PARTIAL INVALIDITY

     If, at any time, any provision of this Deed is or becomes illegal,
invalid or unenforceable in any respect under the law of any jurisdiction,
neither the legality, validity or enforceability of the remaining
provisions of this Deed under the law of that jurisdiction nor the
legality, validity or enforceability of that or any other provision of this
Deed under the law of any other jurisdiction shall in any way be affected
or impaired thereby unless the effect of the foregoing would be
substantially to alter the rights and obligations of the parties originally
agreed.

28.  ASSIGNMENT

     The Security Trustee may at any time, without the consent of the
Chargor, assign or transfer the whole or, as the case may be, any part of
the Security Trustee's Rights under this Deed to any person to whom the
whole or any part of the Security Trustee's Rights under the Loan Agreement
shall be assigned or transferred.  The Chargor may not assign, transfer,
novate or dispose of any of or any interest in, its rights or obligations
under this Deed.

29.  LAW AND JURISDICTION

     29.1   ENGLISH LAW

     THIS DEED SHALL BE GOVERNED BY ENGLISH LAW.

     29.2   JURISDICTION

     (A)  FOR THE EXCLUSIVE BENEFIT OF THE SECURITY TRUSTEE AND THE
FACILITY AGENT, THE CHARGOR IRREVOCABLY AGREES THAT THE COURTS OF ENGLAND
ARE TO HAVE JURISDICTION TO SETTLE ANY DISPUTES WHICH MAY ARISE OUT OF OR
IN CONNECTION WITH THIS DEED AND THAT ACCORDINGLY ANY SUIT, ACTION OR
PROCEEDINGS (TOGETHER IN THIS CLAUSE 29 (LAW AND JURISDICTION) REFERRED TO
AS "PROCEEDINGS") ARISING OUT OF OR IN CONNECTION WITH THIS DEED MAY BE
BROUGHT IN SUCH COURTS, SUBJECT TO THE OPTION REFERRED TO IN CLAUSE 29.6
(ARBITRATION).

     (B)  THE CHARGOR IRREVOCABLY WAIVES AND AGREES NOT TO RAISE ANY
OBJECTION WHICH IT MAY HAVE NOW OR HEREAFTER TO THE LAYING OF THE VENUE OF
ANY PROCEEDINGS IN ANY SUCH COURT AS IS REFERRED TO IN THIS CLAUSE 29.2 AND
ANY CLAIM THAT ANY SUCH PROCEEDINGS HAVE BEEN BROUGHT IN AN INCONVENIENT OR
INAPPROPRIATE FORUM AND FURTHER IRREVOCABLY AGREES THAT A JUDGMENT IN ANY
PROCEEDINGS BROUGHT IN THE ENGLISH COURTS SHALL BE CONCLUSIVE AND BINDING
UPON THE CHARGOR AND MAY BE ENFORCED IN THE COURTS OF ANY OTHER
JURISDICTION.

     (C)  NOTHING CONTAINED IN THIS CLAUSE 29.2 SHALL LIMIT THE RIGHT OF
THE SECURITY TRUSTEE TO TAKE PROCEEDINGS AGAINST THE CHARGOR IN ANY OTHER
COURT OF COMPETENT JURISDICTION, NOR SHALL THE TAKING OF PROCEEDINGS IN ONE
OR MORE JURISDICTIONS PRECLUDE THE TAKING OF PROCEEDINGS IN ANY OTHER
JURISDICTION, WHETHER CONCURRENTLY OR NOT.

     29.3   PROCESS AGENT

     THE CHARGOR HEREBY IRREVOCABLY AND UNCONDITIONALLY:

     (A)  APPOINTS LAW DEBENTURE CORPORATE SERVICES LIMITED, WHOSE ADDRESS
IS AT PRINCES HOUSE, 95 GRESHAM STREET, LONDON EC2V 7LY, ENGLAND AS ITS
PROCESS AGENT TO RECEIVE, FOR AND ON ITS BEHALF, SERVICE OF PROCESS IN
ENGLAND IN ANY PROCEEDINGS WITH RESPECT TO THIS DEED;

     (B)  AGREES THAT FAILURE BY ANY SUCH PROCESS AGENT TO GIVE NOTICE OF
SUCH PROCESS TO IT SHALL NOT IMPAIR THE VALIDITY OF SUCH SERVICE OR OF ANY
JUDGMENT BASED THEREON; AND

     (C)  AGREES THAT NOTHING IN THIS DEED SHALL AFFECT THE RIGHT TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

     29.4   WAIVER OF IMMUNITY

     TO THE EXTENT THAT THE CHARGOR MAY NOW OR HEREAFTER BE ENTITLED, IN
ANY JURISDICTION IN WHICH PROCEEDINGS MAY AT ANY TIME BE COMMENCED WITH
RESPECT TO THIS DEED, TO CLAIM FOR ITSELF OR ANY OF ITS UNDERTAKINGS,
PROPERTIES, ASSETS OR REVENUES PRESENT OR FUTURE ANY IMMUNITY (SOVEREIGN OR
OTHERWISE) FROM SUIT, JURISDICTION OF ANY COURT, ATTACHMENT PRIOR TO
JUDGMENT, ATTACHMENT IN AID OF EXECUTION OF A JUDGMENT, EXECUTION OF A
JUDGMENT OR FROM SET-OFF, BANKER'S LIEN, COUNTERCLAIM OR ANY OTHER LEGAL
PROCESS OR REMEDY WITH RESPECT TO ITS OBLIGATIONS UNDER THIS DEED AND/OR TO
THE EXTENT THAT IN ANY SUCH JURISDICTION THERE MAY BE ATTRIBUTED TO THE
CHARGOR, ANY SUCH IMMUNITY (WHETHER OR NOT CLAIMED), THE CHARGOR HEREBY TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW IRREVOCABLY AGREES NOT TO
CLAIM, AND HEREBY TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW WAIVES,
ANY SUCH IMMUNITY.

     29.5   CONSENT TO ENFORCEMENT

     THE CHARGOR CONSENTS GENERALLY IN RESPECT OF ANY PROCEEDINGS TO THE
GIVING OF ANY RELIEF OR THE ISSUE OF ANY PROCESS IN CONNECTION WITH SUCH
PROCEEDINGS INCLUDING THE MAKING, ENFORCEMENT OR EXECUTION AGAINST ANY
PROPERTY WHATSOEVER (IRRESPECTIVE OF ITS USE OR INTENDED USE) OF ANY ORDER
OR JUDGMENT WHICH MAY BE MADE OR GIVEN IN SUCH PROCEEDINGS.

     29.6   ARBITRATION

     IF ANY DISPUTE ARISES IN RELATION TO THIS DEED, INCLUDING ANY QUESTION
AS TO EXISTENCE, VALIDITY OR TERMINATION, SUCH DISPUTE SHALL, AT THE OPTION
ONLY OF THE SECURITY TRUSTEE, BE REFERRED TO AND FINALLY RESOLVED BY
ARBITRATION UNDER THE RULES OF THE LONDON COURT OF INTERNATIONAL
ARBITRATION WHICH ARE APPLICABLE AT THE TIME OF REFERENCE TO THE
ARBITRATION AND ARE DEEMED TO BE INCORPORATED BY REFERENCE INTO THIS CLAUSE
29.6. SUCH ARBITRATION SHALL TAKE PLACE IN LONDON, ENGLAND AND SHALL BE
CONDUCTED BY THREE ARBITRATORS, ONE OF WHOM SHALL BE NOMINATED BY THE
CHARGOR, ONE BY THE SECURITY TRUSTEE AND THE THIRD TO BE AGREED BETWEEN THE
TWO ARBITRATORS SO NOMINATED AND IN DEFAULT HE SHALL BE NOMINATED BY THE
PRESIDENT OF THE LONDON COURT OF INTERNATIONAL ARBITRATION. THE LANGUAGE IN
WHICH SUCH ARBITRATION SHALL BE CONDUCTED SHALL BE ENGLISH. ANY AWARD
RENDERED SHALL BE FINAL AND BINDING ON THE PARTIES THERETO AND MAY BE
ENTERED INTO ANY COURT HAVING JURISDICTION OR APPLICATION MAY BE MADE TO
SUCH COURT FOR AN ORDER OF ENFORCEMENT AS THE CASE MAY REQUIRE.  NO PARTY
MAY APPEAL TO ANY COURT FROM ANY AWARD OR DECISION OF THE ARBITRAL TRIBUNAL
AND, IN PARTICULAR, BUT WITHOUT LIMITATION, NO APPLICATIONS MAY BE MADE
UNDER SECTION 45 OF THE ARBITRATION ACT 1996 AND NO APPEAL MAY BE MADE
UNDER SECTION 69 OF THE SAID ACT.

30.  COUNTERPARTS

     This Deed may be executed in any number of counterparts and by
different parties on separate counterparts which when taken together shall
constitute one instrument.

     IN WITNESS WHEREOF this Deed has been executed as a Deed by the
parties hereto and is delivered on the date stated at the beginning of this
Deed.

                                   EXECUTED as a deed and delivered by
                                   CHAPARRAL RESOURCES, INC. acting

                                   by   /S/ MICHAEL B. YOUNG
                                        -----------------------------
                                        Name:  Michael B. Young
                                        Title: Treasurer

                                   In the presence of:

                                        /S/ MARK S. CROFT
                                        -----------------------------
                                        Witness
                                        Name:  Mark S. Croft


                                   The COMMON SEAL of
                                   THE LAW DEBENTURE TRUST
                                   CORPORATION p.l.c.
                                   was hereunto affixed in the presence of:

                                        /S/ JULIAN MASON-JEBB
                                        -----------------------------
                                        Name:  Julian Mason-Jebb
                                        Title:    Director


                                        /S/ CLIVE RAKESTROW
                                        -----------------------------
                                        Name:  Clive Rakestrow
                                        Title:    Authorised Signatory



                             TABLE OF CONTENTS

                                                                       PAGE

1.   DEFINITIONS AND INTERPRETATION . . . . . . . . . . . . . . . . .   1
     1.1    Definitions . . . . . . . . . . . . . . . . . . . . . . .   1
     1.2    Interpretation. . . . . . . . . . . . . . . . . . . . . .   3

2.   COVENANT TO DISCHARGE OBLIGATIONS. . . . . . . . . . . . . . . .   3
     2.1    Covenant to Pay . . . . . . . . . . . . . . . . . . . . .   3
     2.2    Validity of Demands . . . . . . . . . . . . . . . . . . .   3

3.   SECURITY . . . . . . . . . . . . . . . . . . . . . . . . . . . .   3
     3.1    Charging Provisions . . . . . . . . . . . . . . . . . . .   3
     3.2    Obligation to Deposit Certificates relating to
            Original Shares . . . . . . . . . . . . . . . . . . . . .   4
     3.3    Obligation to deposit Certificates relating to
            Derivative Assets . . . . . . . . . . . . . . . . . . . .   4
4.   RESTRICTIONS ON DEALING WITH CHARGED ASSETS. . . . . . . . . . .   4
     4.1    Negative Pledge . . . . . . . . . . . . . . . . . . . . .   4
     4.2    Disposal of Charged Assets. . . . . . . . . . . . . . . .   4
     4.3    Change in Charged Assets. . . . . . . . . . . . . . . . .   4

5.   GENERAL COVENANTS. . . . . . . . . . . . . . . . . . . . . . . .   4
     5.1    Obligations Relating to Charged Assets. . . . . . . . . .   4
     5.2    Notices Received Relating to Charged Assets . . . . . . .   5
     5.3    Notation in Statutory Books . . . . . . . . . . . . . . .   5
     5.4    Indemnity . . . . . . . . . . . . . . . . . . . . . . . .   5

6.   REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . .   5
     6.1    Repeated Representations and Warranties . . . . . . . . .   5
     6.2    Other Representations and Warranties. . . . . . . . . . .   6

7.   VOTING RIGHTS, DIVIDENDS, ETC. . . . . . . . . . . . . . . . . .   6
     7.1    Before the Charge Becomes Enforceable . . . . . . . . . .   6
     7.2    After the Charge Becomes Enforceable. . . . . . . . . . .   6

8.   SECURITY TRUSTEE'S DISCRETION. . . . . . . . . . . . . . . . . .   7
     8.1    Security Trustee May Cure Breaches of Covenants . . . . .   7
     8.2    Expenses so Incurred. . . . . . . . . . . . . . . . . . .   7

9.   FURTHER ASSURANCES . . . . . . . . . . . . . . . . . . . . . . .   7
     9.1    General Assurance . . . . . . . . . . . . . . . . . . . .   7
     9.2    Additional Security Interests . . . . . . . . . . . . . .   7

10.  ENFORCEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . .  8
     10.1   Charge to Become Enforceable . . . . . . . . . . . . . . .  8
     10.2   Section 101 of the Act . . . . . . . . . . . . . . . . . .  8
     10.3   Sections 93 and 103 of the Act . . . . . . . . . . . . . .  8
     10.4   Additional Rights of Secured Trustee on Enforcement. . . .  8

11.  APPOINTMENT OF RECEIVERS. . . . . . . . . . . . . . . . . . . . .  9
     11.1   Appointment. . . . . . . . . . . . . . . . . . . . . . . .  9
     11.2   Scope of Appointment . . . . . . . . . . . . . . . . . . .  9

12.  RECEIVERS . . . . . . . . . . . . . . . . . . . . . . . . . . . .  9
     12.1   Powers . . . . . . . . . . . . . . . . . . . . . . . . . .  9
     12.2   Conflict . . . . . . . . . . . . . . . . . . . . . . . . . 10
     12.3   Agent of Chargor . . . . . . . . . . . . . . . . . . . . . 10
     12.4   Remuneration . . . . . . . . . . . . . . . . . . . . . . . 10

13.  RIGHTS OF SECURITY TRUSTEE. . . . . . . . . . . . . . . . . . . . 10
     13.1   Rights of Receiver . . . . . . . . . . . . . . . . . . . . 10
     13.2   Redemption of Prior Security Interests . . . . . . . . . . 10
     13.3   Suspense Account . . . . . . . . . . . . . . . . . . . . . 10
     13.4   New Account. . . . . . . . . . . . . . . . . . . . . . . . 10
     13.5   Delegation . . . . . . . . . . . . . . . . . . . . . . . . 11
     13.6   Set-Off. . . . . . . . . . . . . . . . . . . . . . . . . . 11

14.  APPLICATION OF MONEYS . . . . . . . . . . . . . . . . . . . . . . 11

15.  LIABILITY OF SECURITY TRUSTEE, RECEIVERS AND DELEGATES. . . . . . 11
     15.1   Possession . . . . . . . . . . . . . . . . . . . . . . . . 11
     15.2   Security Trustee's Liability . . . . . . . . . . . . . . . 12
     15.3   Receiver's Liability . . . . . . . . . . . . . . . . . . . 12
     15.4   Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . 12

16.  PROTECTION OF THIRD PARTIES . . . . . . . . . . . . . . . . . . . 12
     16.1   Contractual Protection . . . . . . . . . . . . . . . . . . 12
     16.2   Statutory Protection . . . . . . . . . . . . . . . . . . . 13

17.  CONTINUING SECURITY INTERESTS AND OTHER MATTERS . . . . . . . . . 13
     17.1   Continuing and Independent Security Interest . . . . . . . 13
     17.2   Primary Obligations. . . . . . . . . . . . . . . . . . . . 13

18.  ADDITIONAL SECURITY INTERESTS . . . . . . . . . . . . . . . . . . 13

19.  CHARGE NOT TO BE AFFECTED . . . . . . . . . . . . . . . . . . . . 13

20.  RELEASE OF CHARGED ASSETS . . . . . . . . . . . . . . . . . . . . 14
     20.1   Release of Charged Assets. . . . . . . . . . . . . . . . . 14
     20.2   Retention of This Deed . . . . . . . . . . . . . . . . . . 14

21.  POWER OF ATTORNEY . . . . . . . . . . . . . . . . . . . . . . . . 15
     21.1   Appointment. . . . . . . . . . . . . . . . . . . . . . . . 15
     21.2   Ratification . . . . . . . . . . . . . . . . . . . . . . . 15

22.  CURRENCY INDEMNITY. . . . . . . . . . . . . . . . . . . . . . . . 15

23.  DEFAULT INTEREST. . . . . . . . . . . . . . . . . . . . . . . . . 15

24.  CERTIFICATES TO BE CONCLUSIVE EVIDENCE. . . . . . . . . . . . . . 16

25.  COSTS AND EXPENSES. . . . . . . . . . . . . . . . . . . . . . . . 16
     25.1   Transaction Costs. . . . . . . . . . . . . . . . . . . . . 16
     25.2   Preservation and Enforcement Costs . . . . . . . . . . . . 16
     25.3   Stamp Taxes. . . . . . . . . . . . . . . . . . . . . . . . 16
     25.4   Security Trustee's Additional Costs. . . . . . . . . . . . 16
     25.5   Tax. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

26.  NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
     26.1   Giving of Notices. . . . . . . . . . . . . . . . . . . . . 17
     26.2   Addresses for Notices. . . . . . . . . . . . . . . . . . . 17
     26.3   English Language . . . . . . . . . . . . . . . . . . . . . 18

27.  REMEDIES AND WAIVERS, PARTIAL INVALIDITY. . . . . . . . . . . . . 18
     27.1   Remedies and Waivers . . . . . . . . . . . . . . . . . . . 18
     27.2   Partial Invalidity . . . . . . . . . . . . . . . . . . . . 18

28.  ASSIGNMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

29.  LAW AND JURISDICTION. . . . . . . . . . . . . . . . . . . . . . . 19
     29.1   ENGLISH LAW. . . . . . . . . . . . . . . . . . . . . . . . 19
     29.2   JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . 19
     29.3   PROCESS AGENT. . . . . . . . . . . . . . . . . . . . . . . 19
     29.4   WAIVER OF IMMUNITY . . . . . . . . . . . . . . . . . . . . 20
     29.5   CONSENT TO ENFORCEMENT . . . . . . . . . . . . . . . . . . 20
     29.6   ARBITRATION. . . . . . . . . . . . . . . . . . . . . . . . 20

30.  COUNTERPARTS. . . . . . . . . . . . . . . . . . . . . . . . . . . 21