Document:

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                                                                  Exhibit 10.15

                 ASSIGNMENT, ASSUMPTION, ACKNOWLEDGEMENT AND CONSENT

     1.   Reference is made to (i) the Platform Construction Agreement, the
Ancillary Agreement and the Confidentiality Agreement, each dated as of April
30, 1997 in each case between AMFELS, INC. ("AMFELS"), and Chiles Offshore
LLC (the "Company"), as assignee of and successor in interest to COI, LLC
(successor by merger to Chiles Offshore, Inc.) pursuant to an instrument of
Assignment and Assumption and Consent to Assignment dated as of August 5,
1997 (collectively, the "Chiles Columbus Agreement") and (ii) the Platform
Construction Agreement dated as of August 5, 1997 between AMFELS and the
Company (the "Chiles Magellan Agreement"; together with the Chiles Columbus
Agreement, the "Construction Agreements").

     2.   The Company hereby assigns (i) to Chiles Columbus LLC, a Delaware
limited liability company and wholly owned subsidiary of the Company, all of
the rights and benefits of the Company with respect to the Chiles Columbus
Agreement and (iii) to Chiles Magellan LLC, a Delaware limited liability
company and wholly owned subsidiary of the Company, all of the rights and
benefits of the Company, all of the rights and benefits of the Company with
respect to the Chiles Magellan Agreement.

     3.   Chiles Columbus LLC hereby undertakes, assumes and agrees to pay,
perform or discharge in accordance with their terms, to the extent not
heretofore paid, performed or discharged, all obligations of the Company
under or otherwise with respect to the Chiles Columbus Agreement, and Chiles
Magellan LLC hereby undertakes, assumes and agrees to pay, perform or
discharge in accordance with their terms, to the extent not heretofore paid,
performed or discharged, all obligations of the Company under or otherwise
with respect to the Chiles Magellan Agreement.

     4.   AMFELS hereby acknowledges the foregoing assignment and assumption
agreement with respect to the Chiles Columbus agreement, and hereby consents
to the assignment by the Company to Chiles Columbus LLC of all of the rights
and benefits of the Company under the Chiles Columbus Agreement, and agrees
that Chiles Columbus LLC may succeed to and assume all of the Company's
rights, benefits, duties and obligations under such agreement, all as set
forth in paragraphs 2 and 3 above.

     5.   AMFELS hereby acknowledges the foregoing assignment and assumption
agreement with respect to the Chiles Magellan Agreement, and hereby consents
to the assignment by the Company to Chiles Magellan LLC of all of the rights
and benefits of the Company under the Chiles Magellan Agreement, and agrees
that

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Chiles Magellan LLC may succeed to and assume all of the Company's rights,
benefits, duties and obligations under such agreement, all as set forth in
paragraphs 2 and 3 above.

     6.   The foregoing acknowledgement and consent shall not, with respect
to either Construction Agreement, operate to release the Company from any of
its obligations or liabilities thereunder in the event that Chiles Columbus
LLC or Chiles Magellan LLC, as applicable, shall fail to perform any of its
obligations thereunder.   If there is any conflict between the provisions of
this paragraph and any other contained in this document, this paragraph shall
be controlling, and further provided however that nothing herein shall
constitute a subordination or waiver of (i) any rights of AMFELS in or under
the Construction Agreements and associated documents and agreements, at law
or in equity, or (ii) any lien, title or equity of AMFELS, by contract, at
law or in equity, in any Platforms to be constructed pursuant thereto, (iii)
any remedies of AMFELS under the Construction Agreements and associated
documents, at law or in equity, including without limitation the right to
payment, setoff, and deduction of all sums due AMFELS at any time under the
Construction Agreements or associated documents and agreements.

          Executed and dated as of April 23, 1998.

                                   CHILES OFFSHORE LLC

                                   BY: /s/ William E. Chiles
                                       -----------------------
                                       Name: William E. Chiles
                                       Title: President

                                   CHILES COLUMBUS LLC

                                   BY: /s/ William E. Chiles
                                       -----------------------
                                       Name: William E. Chiles
                                       Title: President

                                   CHILES MAGELLAN LLC

                                   BY: /s/ William E. Chiles
                                       -----------------------
                                       Name: William E. Chiles
                                       Title: President

                                   AMFELS, INC.

                                   BY: /s/ Eric Phua
                                       -----------------
                                       Name: Eric Phua
                                       Title: VP Commercial<PAGE>

                                                                  Exhibit 10.16

                                     FORM OF
                          REGISTRATION RIGHTS AGREEMENT

                  REGISTRATION RIGHTS AGREEMENT, dated as of June __, 2000
(this "AGREEMENT"), among Chiles Offshore LLC, a Delaware limited liability
company ("CHILES"), and each person who has agreed to become bound by, and
subject to, the terms hereof (collectively, the "HOLDERS" and each, a
"HOLDER").

                              W I T N E S S E T H :

                  WHEREAS, pursuant to certain agreements entered into in order
to effect the conversion of Chiles into a Delaware corporation or the merger of
Chiles into a successor entity organized as a Delaware corporation (the
"FORMATION," with Chiles, following such conversion, or the entity resulting
from such merger, being referred to herein as the "COMPANY"), the Company,
contemporaneously with the Formation, (a) shall issue shares of common stock to
each of the Holders in conversion of or exchange for the Membership Interests in
Chiles ("Membership Interests") presently held by them, (b) shall issue warrants
to purchase shares of common stock of the Company to each of the Holders who
hold rights to purchase Membership Interests ("RIGHTS") immediately prior to the
Formation in exchange for such Rights (c) may issue shares of common stock to
certain persons in connection with the direct or indirect acquisition of a
drilling rig that Chiles currently operates under a "bareboat" charter (the
shares of common stock to be issued pursuant to clause (a) above; the shares of
common stock for which the Warrants referred to in this clause (b) are
exercisable and the shares of common stock that may be issued in the transaction
described in clause (c), above, are referred to collectively as the "SHARES"),
and (d) shall offer for sale shares of common stock in an initial public
offering thereof (the "INITIAL PUBLIC OFFERING");

                  WHEREAS, each of the Holders, pursuant to a Consent and
Amendment to the Second Amended and Restated Operating Agreement of Chiles
Offshore LLC (the "CONSENT"), dated as of June __, 2000, or otherwise, has
agreed to be bound by, and subject to the terms and conditions of this
Agreement;

                  WHEREAS, the Shares and Warrants will be delivered to the
Holders pursuant to the Formation without registration under the Securities Act
(as defined) in reliance on an applicable exemption from such registration, and
the Company and the Holders desire to provide for the registration of the resale
by the Holders of Registrable Securities (as hereinafter defined) from time to
time, upon the terms and subject to conditions set forth below; and

                  WHEREAS, it is intended by the Company and the Holders that
this Agreement shall become effective immediately upon the Formation.

                  NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants herein contained, the parties hereto, intending to be legally
bound, hereby agree as follows:
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                  Section 1. CERTAIN OTHER DEFINITIONS. As used in this
Agreement, the following capitalized terms (in their singular and plural forms,
as applicable) have the following meanings:

                  "BUSINESS DAY" means any day on which commercial banks are
open for business in the City of New York, Borough of Manhattan.

                  "COMMISSION" means the United States Securities and Exchange
Commission and any successor United States federal agency or governmental
authority having similar powers.

                  "COMMON STOCK" means the common stock, $0.01 par value, of the
Company.

                  "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.

                  The terms "REGISTER," "REGISTERED" and "REGISTRATION" means a
registration effected by preparing and filing with the Commission a registration
statement on an appropriate form in compliance with the Securities Act, and the
declaration or order of the Commission of the effectiveness of such registration
statement under the Securities Act.

                  "LISTING" means (i) the admission to listing of any of the
Common Stock on a recognized stock exchange and such listing becoming effective
in accordance with the rules of the relevant exchange or (ii) the commencement
of trading of any of the Common Stock on an inter-dealer quotation system.

                  "REGISTRABLE SECURITIES" means the Shares issued to the
Holders in connection with the Formation, the Shares for which the Warrants
issued to certain Holders in connection with the Formation are exercisable and
any other securities issued by the Company to the Holders at any time after the
Formation in respect of the Shares (and in respect of the Common Stock
generally) by means of exchange, reclassification, dividend, distribution, split
up, combination, subdivision, recapitalization, merger, spin-off, reorganization
or otherwise; PROVIDED, HOWEVER, that as to any Registrable Securities, such
securities shall cease to constitute the same for purposes of this Agreement if
and when (i) a registration statement with respect to the sale of such Shares
shall have been declared effective by the Commission and such Shares shall have
been sold pursuant thereto in accordance with the intended plan and method of
distribution therefor set forth in the final prospectus forming part of such
registration statement; (ii) such Shares shall have been sold in satisfaction of
all applicable resale provisions of Rule 144 under the Securities Act; (iii) as
expressed in an opinion of independent counsel delivered and satisfactory to the
Company and the transfer agent for the Common Stock, such Shares may be resold
pursuant to Rule 144(k) under the Securities Act (or any successor provision) or
all of such Holder's Registrable Securities may be resold in a single ninety
(90) day period under Rule 144 of the Securities Act and do not require
qualification

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under any state securities or "BLUE SKY" law then in effect, or the use of an
applicable exemption therefrom and, in each case, the Company has notified the
transfer agent for the Common Stock that any restrictive legend on such Shares
may be removed in connection with a transfer thereof; or (iv) such Shares cease
to be issued and outstanding for any reason.

                  "REGISTRATION EXPENSES" means all expenses incurred by the
Company in complying with Section 4 hereof, including, without limitation, all
registration and filing fees (including fees and expenses associated with
filings required to be made with the National Association of Securities Dealers,
Inc. and any national securities exchange or U.S. automated inter-dealer
quotation system of a registered national securities association on which the
Common Stock is listed or otherwise admitted to unlisted trading privileges),
printing expenses, if any (including expenses of printing certificates for the
Common Stock being registered in a form eligible for deposit with The Depository
Trust Company and of printing registration statements and prospectuses), fees
and disbursements of counsel for the Company, fees and expenses of compliance
with state securities or "BLUE SKY" laws (including reasonable fees and expenses
of one firm of counsel for underwriters, if any, in connection with "BLUE SKY"
qualifications of the Registrable Securities being registered and the
determination of eligibility for investment under the laws of such jurisdictions
designated by the underwriters, if any), accountants' fees and expenses
(including the expenses of any special audits or "COMFORT" letters incident to
or required by any such registration), transfer taxes, fees of transfer agents
and registrars, and fees and disbursements of underwriters customarily paid by
issuers or sellers of securities, but excluding underwriting discounts and
commissions and broker-dealer concessions and allowances and marketing expenses.

                  "SECURITIES ACT" means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder.

                  "SIGNIFICANT SUBSIDIARY" has the meaning ascribed to such term
in Rule 1-02(w) of Regulation S-X under the Securities Act and the Exchange Act.

                  "UNDERWRITTEN OFFERING" means a registration under the
Securities Act pursuant to which securities of the Company are sold to an
underwriter for reoffering and distribution to the public.

                  Section 2. REPRESENTATIONS AND WARRANTIES OF HOLDERS.

                  (a) INVESTMENT REPRESENTATIONS. Each Holder severally (and not
jointly) hereby represents, acknowledges, covenants and agrees as follows: (i)
the Shares are being acquired for such Holder's own account for investment
purposes only and not with a view to any public resale, public distribution or
public offering thereof within the meaning of the Securities Act or any state
securities or "BLUE SKY" law; (ii) to the knowledge of such Holder, the Shares
have not been registered under the Securities Act or any state securities or
"BLUE SKY" law; (iii) such Holder either is an "ACCREDITED INVESTOR" within the
meaning of Rule 501 of Regulation D under the Securities Act, or

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alone or together with such Holder's purchaser representative, has such
knowledge and experience in financial and business matters that such Holder is
capable of evaluating the relative merits and risks of the prospective
investment in the Shares and able to bear the economic consequences thereof;
(iv) such Holder will not offer for sale, sell or otherwise transfer any of the
Shares (or any interest therein) except pursuant to a registration statement as
contemplated hereby or pursuant to an exemption from the registration
requirements of the Securities Act and any applicable state securities or "BLUE
SKY" laws and, in the case of an offer to sell, sale or other transfer pursuant
to such an exemption, the Company has received (or waived the requirement
therefor) a written opinion of U.S. counsel in form and substance satisfactory
to it to the effect that such disposition is exempt from such registration
requirements, provided that such Holder, prior to effecting any transfer of
Shares pursuant to such an exemption, will cause the intended transferee of the
Shares to agree to take and hold such Shares subject to the terms and conditions
of this Agreement (and, in that regard, to execute and deliver to the Company
such agreements and instruments as the Company reasonably may request to
evidence the same), and further acknowledges that the certificates evidencing
such Shares are required to have endorsed thereon a legend to the effect set
forth in Section 3 hereof; (v) in making such Holder's decision to invest in the
Registrable Securities, such Holder has relied upon independent investigations
made by such Holder and, to the extent believed by him or it to be appropriate,
has relied on investigations made by such Holder's representatives, including
such Holder's own legal, accounting, investment, financial, tax and other
professional advisors; (vi) such Holder has been furnished and has been afforded
an opportunity to review the Company's 1999 and 1998 audited financial
statements (the "FINANCIAL STATEMENTS"); and (vii) such Holder and such Holder's
purchaser representatives, as applicable, have been given the opportunity to
examine all documents, including the Financial Statements, and to ask questions
of, and to receive answers from, the Company and its representatives concerning
the terms of the Formation and such Holder's investment in the Shares.

                  (b) REPRESENTATION REGARDING PLANS OR INTENTIONS. Each holder
severally (and not jointly) represents, acknowledges and agrees that he, she or
it has no plan or intention to sell or otherwise dispose of any or all of such
Holder's Shares.

                  Section 3. LEGEND ON SHARE CERTIFICATES. Each certificate
representing the Shares shall have endorsed thereon a legend in substantially
the following form:

                  "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
         REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
         SECURITIES LAW, AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED
         OF IN THE ABSENCE OF SUCH REGISTRATION UNLESS PURSUANT TO AN AVAILABLE
         EXEMPTION THEREFROM. IN ALL CASES, SUCH SHARES MAY BE TRANSFERRED ONLY
         IN COMPLIANCE WITH THE CONDITIONS SPECIFIED IN THE REGISTRATION RIGHTS
         AGREEMENT DATED AS OF JUNE __, 2000, AMONG THE COMPANY AND THE
         STOCKHOLDERS PARTY THERETO, A COPY OF WHICH IS

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         AVAILABLE FOR INSPECTION AT THE PRINCIPAL EXECUTIVE OFFICES OF THE
         COMPANY AND WILL BE FURNISHED TO THE HOLDER HEREOF WITHOUT CHARGE, UPON
         WRITTEN REQUEST TO CHILES OFFSHORE INC., 11200 RICHMOND AVENUE, SUITE
         490, HOUSTON, TEXAS 77082, ATTENTION: SECRETARY."

                  Section 4. DEMAND REGISTRATION (a) NOTICES OF DEMAND
REGISTRATION. Subject to the terms and conditions of this Agreement, from and
after the date that is 180 days after the date of consummation of the Initial
Public Offering, Holders shall have the right to request, by notice in writing
to the Company, that the Company effect the registration of such number of
Registrable Securities, as specified by such Holder in the notice, on Form S-1
(or if the Company so determines and is eligible, Form S-2 or S-3, or any
successor form, if available) (a "DEMAND REGISTRATION"). The Company shall
promptly, but not later than 10 days after receipt of such notice, give written
notice of such proposed registration to all other Holders. Such other Holders
shall have the right, by written notice to the Company within 20 days after the
Company sends its notice, to elect to have included in such registration such of
their Registrable Securities as such Holders may request in such notice of
election.

                  (b) UNDERWRITER CUTBACK. If the underwriter managing the
offering determines that, because of marketing considerations, some or all of
the Registrable Securities requested to be registered by all Holders may not be
included in the offering, then all Holders who have requested Demand
Registration shall, subject to section 4(c), nevertheless be entitled to
participate in the registration pro rata based upon the number of Registrable
Securities requested to be included by each such Holder. In all such cases, the
Company shall include all Registrable Securities requested to be included in
such registration by Holders prior to the inclusion of any Registrable
Securities to be sold by the Company or any person other that a Holder.

                  (c) CERTAIN RESTRICTIONS ON DEMAND REGISTRATIONS. (i) Holders
of Registrable Securities will be entitled to request, as provided by Section 4
(a) hereof, no more than three (3) Demand Registrations. A registration will not
be considered for purposes of this Section 4 (c) to have been "requested" until
it has become effective.

                           (ii) The Company will not be obligated to effect any
Demand Registration or give any notice specified in Section 4 (a) hereof: (i)
within twelve (12) months after the effective date of a previous Demand
Registration pursuant to this Agreement, (ii) pursuant to a request for a Demand
Registration that does not constitute an Underwritten Offering, (iii) pursuant
to a request for Demand Registration in which less than $50 million of gross
proceeds, in the aggregate, are to be received upon the sale of Registrable
Securities or (iv) pursuant to a request for a Demand Registration by the
Holders of less than 25% of the Registrable Securities.

                  (d) LIMITATION ON SENIOR REGISTRATION RIGHTS. The Company will
not grant to any person (other than the Holders) rights to request the Company
to register any of its securities that are superior to or PARI PASSU with the
rights granted to the Holders

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herein, without the prior written consent of the Holders of a majority of
Registrable Securities.

                  (e) SELECTION OF UNDERWRITERS. In the case of a Demand
Registration, which in all cases shall be an Underwritten Offering, the Holders
of a majority of the Registrable Securities to be included in such Demand
Registration will have the right to select the investment banker(s) and
manager(s) to administer and underwrite such Underwritten Offering, subject to
the Company's approval which will not be unreasonably withheld.

                  Section 5. BLACKOUT PERIODS. (a) The Company shall be entitled
to postpone and delay the registration of Registrable Securities and may require
that Holders immediately cease sales of shares pursuant to a Registration
Statement (a "BLACKOUT PERIOD") if (i) the Company is engaged or has publicly
announced plans to engage, within 30 days of the time of the request, in a
registered public offering in which the Holders may include Registrable
Securities pursuant to Section 6 hereof, or (ii) such registration would, in the
good faith judgment of the Board of Directors of the Company, require a
disclosure in the Registration Statement of material non-public information in
connection with a pending merger, reorganization, consolidation, or acquisition
or disposition of assets that the Company is not otherwise obligated to disclose
and that would be materially detrimental to the Company (a "VALID BUSINESS
REASON"), PROVIDED, HOWEVER, that: (i) the Company shall use reasonable best
efforts to minimize the length of any such period of delays or suspension, (ii)
the Company shall not be permitted to so delay or suspend the Registration
Statement for a period of more than 120 days in any 12 month period or for any
longer than such Valid Business Reason Exists, (iii) once a Registration
Statement has been filed prior to the giving of such notice the Company may
cause such Registration Statement to be withdrawn, however, once any
Registration Statement becomes effective, the Company may not cause its
effectiveness to be terminated and the Company may not postpone amending or
supplementing such Registration Statement and (iv) if the Company shall give any
notice of postponement or withdrawal of any Registration Statement, the Company
shall not, during the period of postponement or withdrawal, register any capital
stock of the Company, other than pursuant to a Registration Statement on Form
S-4 or S-8 (or an equivalent registration form then in effect).

                  (b) If the Company delays or suspends the Registration
Statement or requires the Holders to cease sales pursuant to Section 5(a), the
Company shall, as promptly as practicable following the termination of the
circumstance that entitled the Company to do so (but in no event later than 90
days after the date of the postponement), take such actions as may be necessary
to file or reinstate the effectiveness of such Registration Statement and give
written notice to all Holders authorizing them to resume sales pursuant to such
Registration Statement. If as a result thereof the prospectus included in such
Registration Statement has been amended to comply with the requirements of the
Securities Act, the Company shall enclose such revised prospectus with the
notice to Holders given pursuant to this paragraph, and the Holders shall make

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no offers or sales of Registrable Securities pursuant to such Registration
Statement other than by means of such revised prospectus.

                  (c) If the Company shall postpone filing or shall withdraw any
Registration Statement filed under Section 5(a), the Company shall not be
considered to have effected an effective registration for the purposes of this
Section 5 until the Company shall have filed a new Registration Statement and
such Registration Statement shall have been declared effective and shall not
have been withdrawn and the Registrable Securities registered thereunder shall
have been sold pursuant thereto in accordance with the intended plan and method
of distribution therefor set forth in the final prospectus forming part of such
Registration Statement.

                  Section 6. PIGGYBACK REGISTRATION. (a) RIGHT TO PIGGYBACK.
Whenever the Company proposes to register any of its Common Stock under the
Securities Act (other than pursuant to the Initial Public Offering, a Demand
Registration or a registration statement on Form S-4 or Form S-8 or any similar
form or in connection with a registration the primary purpose of which is to
register Common Stock in connection with an acquisition or business combination
transaction or in connection with stock options and other stock-based employee
benefit plans and compensation) and the registration form to be used may also be
used for the registration of Registrable Securities (a "PIGGYBACK
REGISTRATION"), the Company shall give prompt written notice to all Holders of
Registrable Securities of its intention to effect such a registration and
subject to the terms and conditions of this agreement, shall include in such
registration in all Registrable Securities with respect to which the Company has
received written requests for inclusion therein within 20 days after its notice
is given.

                  (b) UNDERWRITING AGREEMENT. In connection with any
registration under this Section 6 involving an Underwritten Offering, the
Company shall not be required to include any Registrable Securities in such
registration unless the holders thereof accept the terms of an underwriting
agreement in customary form as agreed upon between the Company and the
underwriters selected by it; PROVIDED, HOWEVER, that no Holder shall be liable
for any information other than as is provided in writing by such Holder
expressly for use in the Registration Statement and, PROVIDED FURTHER, that no
Holder shall be required to provide general warranties regarding the business of
the Company.

                  (c) UNDERWRITING CUTBACK. If, in the opinion of the managing
underwriter, it is appropriate because of marketing considerations to limit the
number of Registrable Securities to be included in the offering either on behalf
of selling Holders or in the aggregate, then the Company shall be required to
include in the registration only that number of Registrable Securities that the
managing underwriter believes should be included therein, and the Holders who
have requested registration shall be entitled to participate in the registration
pro rata based upon the number of Registrable Securities requested to be
included by each such Holder; PROVIDED, HOWEVER, that the Company shall include
all Registrable Securities requested to be included in such registration by
Holders

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prior to the inclusion of any Registrable Securities owned by any person other
than the Company.

                  (d) SELECTION OF UNDERWRITERS. If any Piggyback Registration
is an underwritten offering, the investment banker(s) and manager(s) for the
offering shall be selected by the Company.

                  Section 7. HOLDER LOCKUP. (a) INITIAL PUBLIC OFFERING LOCKUP.
Each of the Holders hereby agrees not to effect any public sale or distribution
(including sales pursuant to Rule 144) of Common Stock or any securities
convertible into or exchangeable or exercisable for Common Stock, during the
180-day period beginning on the date of the consummation of the Initial Public
Offering, unless the Company consents in writing to such sale or distribution.

                  (b) DEMAND REGISTRATION LOCKUP. Each of the Holders hereby
agrees not to effect any public sale or distribution (including sales pursuant
to Rule 144) of Shares, or any securities convertible into or exchangeable or
exercisable for such securities, during the seven days prior to, and the 180-day
period beginning on the effective date of, any Demand Registration (except as
part of such underwritten registration), unless the Company and the underwriters
managing the registered public offering otherwise consent in writing.

                  Section 8. REGISTRATION PROCEDURES. If and whenever the
Company is required by the provisions of this Agreement to effect the
registration of any of the Registrable Securities under the Securities Act, the
Company shall:

                  (a) prepare and file with the Commission a Registration
Statement with respect to such Registrable Securities and use its reasonable
best efforts to cause that Registration Statement to become and remain effective
for a period of 120 days (the "EFFECTIVE PERIOD") (the counting of such days
giving no effect to any period during which the holders of the Registrable
Securities were obligated to refrain from selling in accordance with the terms
of this Agreement);

                  (b) cause any registration statement filed pursuant to this
Agreement and the related prospectus and any amendment or supplement thereto, as
of the effective date of such registration statement, amendment or supplement,
(A) to comply in all material respects with the applicable requirements of the
Securities Act and the rules and regulations of the Commission promulgated
thereunder and (B) not to contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading;

                  (c) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with

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<PAGE>

such registration statement as may be necessary to keep such registration
statement effective and to comply with the provisions of the Securities Act with
respect to the disposition of all Registrable Securities covered by such
registration statement during the Effective Period; the Company shall furnish to
each Holder a copy of any amendment or supplement to such registration statement
or prospectus prior to filing the same with the Commission and shall not file
any such amendment or supplement to which any such requesting Holder shall
reasonably have objected in writing on the grounds that such amendment or
supplement does not comply in all material respects with the requirements of the
Securities Act or of the rules or regulations thereunder or otherwise
inaccurately describes information pertaining to such Holder;

                  (d) furnish to each requesting Holder such number of conformed
copies of such registration statement and of each such amendment and supplement
thereto (in each case including all exhibits thereto), such number of copies of
the prospectus included in such registration statement (including each
preliminary prospectus), such number of the documents, if any, incorporated by
reference in such registration statement or prospectus, and such number of other
documents, as such requesting Holder reasonably may request;

                  (e) use its best efforts to register or qualify the
Registrable Securities covered by such registration statement under such
securities or "blue sky" laws of the states of the United States as each
requesting Holder reasonably shall request, to keep such registration or
qualification in effect for so long as such registration statement remains in
effect, and to do any and all other acts and things which may be necessary or
advisable to enable such requesting Holder to consummate the disposition in such
jurisdictions of his, her or its Registrable Securities covered by such
registration statement; PROVIDED HOWEVER, that the Company shall not for any
such purpose be required to qualify generally to do business as a foreign
corporation in any jurisdiction in which it is not and would not, but for the
requirements of this Section 8 (e), be obligated to be so qualified, or to
subject itself to taxation in any such jurisdiction, or to consent to general
service of process in any such jurisdiction;

                  (f) Promptly notify each Holder at any time when a prospectus
or prospectus supplement relating thereto is required to be delivered under the
Securities Act, upon discovery of the occurrence of any event as a result of
which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading, which
untrue statement or omission requires amendment of the registration statement or
supplementing of the prospectus and, at the request of such requesting Holder,
prepare and furnish to such requesting Holder a reasonable number of copies of a
supplement to such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
shall not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; PROVIDED, HOWEVER, that with

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respect to Registrable Securities registered pursuant to such registration
statement, each Holder agrees that such Holder will not sell any Registrable
Securities pursuant to such registration statement during the time after the
furnishing of the Company's notice pursuant to this Section 8(f) while the
Company is preparing and filing with the Commission a supplement to or an
amendment of such prospectus or registration statement;

                  (g) use its best efforts to comply with all applicable rules
and regulations of the Commission, and make available to holders of its
securities, as soon as reasonably practicable, an earnings statement covering
the period of at least 12 months, but not more than 18 months, beginning with
the first month of the first fiscal quarter after the effective date of such
registration statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act; and

                  (h) provide and cause to be maintained a transfer agent and
registrar for the Registrable Securities covered by such registration statement
from and after a date not later than the effective date of such registration
statement; it being hereby agreed that each Holder of Registrable Securities
shall furnish to the Company such information regarding such Holder and the plan
and method of distribution of Registrable Securities intended by such Holder as
the Company may from time to time reasonably request in writing and as shall be
required by law or by the Commission in connection therewith.

                  (i) PREPARATION; REASONABLE INVESTIGATION. In connection with
the preparation and filing of each registration statement registering
Registrable Securities under the Securities Act as contemplated by this
Agreement, the Company shall give each Holder, its underwriters, if any, and
each Holder's counsel and accountants, the opportunity to review the Company's
preparation of such registration statement, each prospectus included in such
registration statement or filed with the Commission and each amendment or
supplement thereto, and the Company will give such person or persons such
reasonable access to the Company's books and records and such opportunities to
discuss the business of the Company with its officers and the independent public
accountants who have certified its financial statements as shall be necessary
for each such Holder and persons to conduct a reasonable investigation within
the meaning of Section 11 of the Securities Act. To minimize disruption and
expense to the Company during the course of the registration process, each
Holder shall use its reasonable best efforts to coordinate its investigation and
due diligence efforts and, to the extent practicable, will act through a single
firm of counsel and a single firm of accountants and, if requested by the
Company, will enter into confidentiality agreements with the Company in a form
satisfactory to the Company.

                  Section 9. INDEMNIFICATION. (a) INDEMNIFICATION BY THE
COMPANY. The Company shall indemnify and hold harmless each Holder of
Registrable Securities covered by any registration statement filed pursuant to
this Agreement, and any underwriter or selling agent selected by one or more
Holders with the consent of the Company with respect to such Registrable
Securities, the directors, trustees and officers, and each other person, if any,
who controls such Holder, underwriter or selling agent

                                       10
<PAGE>

within the meaning of Section 15 of the Securities Act and Section 20 of the
Exchange Act against any losses, claims, damages, liabilities or expenses (each
a "LOSS" and collectively "LOSSES"), joint or several, to which such Holder or
any such persons may become subject under the Securities Act or otherwise, to
the extent that such Losses (or related actions or proceedings) arise out of or
are based upon (A) any untrue statement or alleged untrue statement of any
material fact contained in an effective registration statement in which such
Registrable Securities were included for registration under the Securities Act,
any preliminary prospectus if used prior to the effective date of the
registration statement (unless such statement is corrected in the final
prospectus and the Company previously furnishes copies thereof to any Holder of
Registrable Securities seeking indemnification pursuant to this Section 9),
final prospectus (as supplemented, if the Company shall have filed with the
Commission any supplement thereto) if used during the period in which the
Company is required to keep the registration statement to which such prospectus
relates current and otherwise in compliance with Section 10(a) of the Securities
Act, or (B) any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; PROVIDED,
HOWEVER, that the Company shall have no obligation to provide any
indemnification hereunder if any such Losses (or actions or proceedings in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in such registration
statement, preliminary prospectus or final prospectus, as the case may be, in
reliance upon and in conformity with written information furnished to the
Company by such Holder for inclusion in such registration statement; and
PROVIDED, FURTHER, that the Company shall have no obligation to provide any
indemnification hereunder if any such Losses arise out of or are based upon an
untrue statement or alleged untrue statement or omission or alleged omission in
any preliminary prospectus, if such untrue statement or alleged untrue statement
or omission or alleged omission shall have been corrected in the final
prospectus and such Holder or any such other person shall have failed to deliver
such final prospectus prior to or concurrently with the sale of the Registrable
Securities covered by a registration statement to the individual or entity
asserting such Losses after the Company shall have furnished each such Holder or
any such other person with a sufficient number of copies thereof in a manner and
at a time sufficient to permit delivery of the same. The indemnity provided in
this Section 9(a) shall remain in full force and effect regardless of any
investigation made by or on behalf of such Holder or any such other person and
shall survive the transfer of the Registrable Securities by such Holder or any
such other person.

                  (b) INDEMNIFICATION BY THE HOLDERS. Each Holder and each other
person who controls such Holder within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, shall indemnify and hold
harmless (in the same manner and to the same extent as set forth in Section 9
(a) hereof) the Company, each director of the Company, each officer of the
Company who shall sign such registration statement and each other person, if
any, who controls the Company within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act, with respect to any untrue statement in
or omission from any registration statement filed by the Company

                                       11
<PAGE>

pursuant to this Agreement, any preliminary prospectus or any final prospectus
included in such registration statement, or any amendment or supplement to such
registration statement or prospectus, as the case may be, of a material fact if
such statement or omission was made in reliance upon and in conformity with
written information furnished to the Company or any of its representatives by
such Holder or such other person, if any, who controls such Holder within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
for inclusion in such registration statement, preliminary prospectus or final
prospectus, as the case may be.

                  (c) NOTICE OF CLAIMS, ETC. Promptly after receipt by an
indemnified party of notice of the commencement of any action or proceeding (an
"ACTION") involving a claim referred to in Sections 9(a) and 9(b) hereof, such
indemnified party shall, if indemnification is sought against an indemnifying
party, give written notice to the indemnifying party of the commencement of such
action; PROVIDED, HOWEVER, that the failure of any indemnified party to give
said notice shall not relieve the indemnifying party of its obligations under
Sections 9(a) or 9(b) hereof, except to the extent that the indemnifying party
is actually and materially prejudiced by such failure. In case an Action is
brought against any indemnified party, and such Action notifies an indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent it may elect by written notice delivered
to the indemnified party promptly after receiving the aforesaid notice, to
assume the defense thereof with counsel reasonably satisfactory to such
indemnified party. Notwithstanding the foregoing, the indemnified party shall
have the right to employ its own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such indemnified party,
unless (A) the employment of such counsel shall have been authorized in writing
by the indemnifying party, (B) the indemnifying party shall not have employed
counsel (reasonably satisfactory to the indemnified party) to take charge of the
defense of such Action, within a reasonable time after notice of the
commencement thereof, or (C) such indemnified party reasonably shall have
concluded that there may be defenses available to it which are different from or
additional to those available to the indemnifying party which, if the
indemnifying party and the indemnified party were to be represented by the same
counsel, could result in a conflict of interest for such counsel or materially
prejudice the prosecution of the defenses available to such indemnified party.
If any of the events specified in clauses (A), (B) or (C) of the preceding
sentence shall have occurred or otherwise shall be applicable, then the fees and
expenses of one counsel (or firm of counsel) selected by a majority in interest
of the indemnified parties (measured by reference to their ownership of
Registrable Securities) shall be borne by the indemnifying party. If, in any
case, the indemnified party employs separate counsel, the indemnifying party
shall not have the right to direct the defense of such action on behalf of the
indemnified party. Anything in this Section 9(c) to the contrary
notwithstanding, an indemnifying party shall not be liable for the settlement of
any action effected without its prior written consent (which consent in the case
of an action exclusively seeking monetary relief shall not unreasonably be
withheld or delayed) or if there be a final judgment adverse to the indemnified
party, the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement

                                       12
<PAGE>

or judgment. No indemnifying party shall, without the prior consent of the
indemnified party, consent to entry of any judgment or enter into any settlement
which does not include as a term thereof the unconditional release of the
indemnified party from all liability in respect of such claim or litigation.

                  (d) CONTRIBUTION. If the indemnification provided for in this
Section 9 is unavailable or insufficient to hold harmless an indemnified party
in respect of any Losses, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party, as a result of such Losses in such proportion as
appropriate to reflect the relative fault of the Company, on the one hand, and
the indemnified party, on the other hand, and to the parties' relative intent,
knowledge, access to information and opportunity to correct or mitigate the
damage in respect of or prevent any untrue statement or omission giving rise to
such indemnification obligation. The Company and each Holder agree that it would
not be just and equitable if contributions pursuant to this Section 9(d) were
determined by pro rata allocation or by any other method of allocation which did
not take account of the equitable considerations referred to above. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who is not
guilty of such fraudulent misrepresentation.

                  (e) INDEMNIFICATION PAYMENTS. Periodic payments of amounts
required to be paid pursuant to this Section 9 shall be made during the course
of the investigation or defense, as and when reasonably itemized bills therefor
are delivered to the indemnifying party in respect of any particular Loss,
damage or liability that is incurred.

                  (f) LIMITATION ON SELLER'S PAYMENTS. Notwithstanding any
provision of this Agreement to the contrary, the liability of each Holder of
Registrable Securities under this Section 9 shall in no event exceed the net
proceeds received by such Holder from the sale of Registrable Securities covered
by the registration statement giving rise to such liability.

                  (g) ADJUSTMENT OF LIABILITY. Any indemnifiable Loss under this
Section 9 shall be reduced by any tax benefit accruing to the indemnified party
on account of the indemnification payment and by the amounts actually recovered
by the indemnified party from its insurance carriers in respect of such Loss,
and any amounts recovered by such party subsequent to the payment by the
indemnifying party hereunder with respect to the same claim shall be remitted to
such indemnifying party, except that such remittance shall not exceed the amount
of the indemnification payment made by such indemnifying party.

                  Section 10. REGISTRATION EXPENSES. The Company shall bear all
Registration Expenses incurred in connection with the performance of its
obligations under Section 4 and Section 6 of this Agreement.

                                       13
<PAGE>

                  Section 11. RULE 144. The Company shall comply with the
requirements of Rule 144(c) under the Securities Act, as such Rule may be
amended from time to time (or any similar rule or regulation hereafter adopted
by the Commission), regarding the availability of current public information to
the extent required to enable each Holder to sell Registrable Securities without
registration under the Securities Act pursuant to the resale provisions of Rule
144 (or any similar rule or regulation). Upon the request of a Holder, the
Company will deliver to such Holder a written statement as to whether it has
complied with such requirements and, upon a Holder's compliance with the
applicable provisions of Rule 144, will take such action as may be required
(including, without limitation, causing legal counsel to issue an appropriate
opinion) to cause its transfer agent to effectuate any transfer of Registrable
Securities properly requested by such Holder, in accordance with the terms and
conditions of Rule 144.

                  Section 12. AMENDMENTS AND WAIVERS. (a) Except as otherwise
provided herein, this Agreement may be amended or modified and the Company may
take any action herein prohibited, or omit to perform any act herein required to
be performed by it, only if the Company shall have obtained the written consent
to such amendment, modification, action or omission to act, of Holders of a
majority of the Registrable Securities. Each Holder shall be bound by any
consent authorized by this Section 6, whether or not such Registrable Securities
shall have been marked to indicate such consent.

                  (b) Notwithstanding the provisions of Section 12(a), this
Agreement may be amended by the Company from time to time to reflect changes in
the parties hereto, their holdings of Common Stock and related information.

                  Section 13. NOTICES. All notices, communications and
deliveries required or permitted by this Agreement shall be made in writing
signed by the party making the same, shall specify the Section of this Agreement
pursuant to which it is given or being made and shall be deemed given or made
(i) on the date delivered if delivered by telecopy or in person, (ii) on the
third Business Day after it is mailed if mailed by registered or certified mail
(return receipt requested) (with postage and other fees prepaid) or (iii) on the
day after it is delivered, prepaid, to an overnight express delivery service
that confirms to the sender delivery on such day, as follows:

                  (a) if to the Holders, at their respective addresses listed on
the books and records of the Company; and

                  (b) if to the Company, at 11200 Richmond Avenue, Suite 490,
Houston, Texas 77082, Attention: Mr. Dick H. Fagerstal;

or to such other representative or at such other address of a party as such
party hereto may furnish to the other parties in writing. If notice is given
pursuant to this Section 13 of any assignment to a permitted successor or assign
of a party hereto, the notice shall be given as set forth above to such
successor or assign of such party.

                                       14
<PAGE>

                  Section 14. SECRETARY TO RETAIN COPY. A copy of this
Agreement, including all Exhibits hereto, shall be filed with the Secretary of
the Company, and the Secretary shall make it available to each Holder of
Registrable Securities at all reasonable times during normal business hours.

                  Section 15. ENTIRE AGREEMENT. This Agreement embodies the
entire agreement and understanding between the Company and each Holder in
respect of the subject matter contained herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to the
subject matter of this Agreement.

                  Section 16. GOVERNING LAW. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York
(other than its rules of conflicts of laws to the extent the application of the
laws of another jurisdiction would be required thereby).

                  Section 17. SEVERABILITY. If any provision of this Agreement
or the application thereof to any person or circumstances is determined by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions hereof, or the application of such provision to persons or
circumstances other than those as to which it has been held invalid or
unenforceable, shall remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby, so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
adverse to any party. Upon such determination, the parties shall negotiate in
good faith in an effort to agree upon a suitable and equitable substitute
provision to effect the original intent of the parties.

                  Section 18. TERMINATION. The rights and obligations under this
Agreement shall automatically terminate upon the earlier to occur of (a) all
Shares issued to the Holders pursuant in connection with the formation cease to
be Registrable Securities and (b) the end of the Effective Period, as the same
may be extended pursuant to the terms of this Agreement.

                  Section 19. MISCELLANEOUS. The Company shall not after the
date of this Agreement enter into any agreement with respect to the Common Stock
which violates the rights granted to each Holder in this Agreement without the
requisite consent of Holders of Registrable Securities as provided herein. The
headings in this Agreement are for purposes of reference only and shall not
limit or otherwise affect the meaning of this Agreement. This Agreement may be
executed in any number of counterparts, each of which shall be deemed to be an
original, but all of which, when taken together, shall constitute one and the
same instrument.

                                       15

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