Document:

<Page>
                                                                     EXHIBIT 4.7

                                                                  CONFORMED COPY

                                12 February 2004

            US$100,000,000 SECURED BANK GUARANTEE FACILITY AGREEMENT

                                     between

                               SEAWAY (UK) LIMITED
                               STOLT OFFSHORE S.A.
                          STOLT OFFSHORE SERVICES S.A.
                                STOLT OFFSHORE AS
                             STOLT OFFSHORE LIMITED
                       STOLT OFFSHORE WEST AFRICA S.A.S.U.
                                 SOTRAPLEX S.A.
                               STOLT OFFSHORE B.V.
                              ETPM DEEPSEA LIMITED

                                       and
                               STOLT OFFSHORE INC.
                                 as Indemnifiers

                               STOLT OFFSHORE S.A.

                                       and
                The Parties Listed in Part A of Schedule 1 Hereto
                                  as Guarantors

                                  HSBC BANK PLC
                                   as Arranger

                                 CREDIT LYONNAIS
                                  HSBC BANK PLC
                                       and
                 DNB NOR BANK ASA (formerly DEN NORSKE BANK ASA)
                                as Issuing Banks

                The Parties Listed in Part B of Schedule 1 Hereto
                                    as Banks

                                  HSBC BANK PLC
                     as Facility Agent and Security Trustee

                             WEIL, GOTSHAL & MANGES
                         One South Place London EC2M 2WG
               Tel: +44 (0) 20 7903 1000 Fax: +44 (0) 20 7903 0990
                                  www.weil.com
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                                TABLE OF CONTENTS

                                                                            Page

1   DEFINITIONS AND INTERPRETATION............................................2

2   THE FACILITY.............................................................22

3   PURPOSE AND RESPONSIBILITY...............................................23

4   BANK GUARANTEES..........................................................23

5   REDUCTION................................................................28

6   CONDITIONS PRECEDENT AND SUBSEQUENT......................................28

7   REPRESENTATIONS AND WARRANTIES...........................................33

8   CURRENCY.................................................................37

9   FUNDING AND CASH COVER...................................................38

10  INTEREST.................................................................39

11  GUARANTEE AND INDEMNITY..................................................39

12  FEES.....................................................................43

13  FACILITY DOCUMENTS.......................................................44

14  AGENCY AND TRUST.........................................................46

15  COVENANTS................................................................53

16  EARNINGS.................................................................63

17  EVENTS OF DEFAULT........................................................63

18  SET-OFF AND LIEN.........................................................68

19  ASSIGNMENTS BY OBLIGORS..................................................69

20  ADDITIONAL INDEMNIFIERS..................................................69

21  ASSIGNMENTS AND TRANSFERS BY FINANCE PARTIES AND SUB-
    PARTICIPATION............................................................70

22  PAYMENTS, MANDATORY PREPAYMENT, RESERVE REQUIREMENTS AND
    ILLEGALITY...............................................................71

23  COMMUNICATIONS...........................................................74

24  GENERAL INDEMNITIES......................................................75

25  MISCELLANEOUS............................................................76

26  LAW AND JURISDICTION.....................................................80

SCHEDULE 1...................................................................82

PART A THE GUARANTORS........................................................82

PART B THE BANKS, THE COMMITMENTS AND THE PROPORTIONATE SHARES...............83

SCHEDULE 2 THE SENIOR SHIPOWNING GUARANTORS AND THE SENIOR VESSELS...........84

                                       i
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                                TABLE OF CONTENTS
                                   (continued)

                                                                            Page

SCHEDULE 3 THE JUNIOR SHIPOWNING GUARANTORS AND THE JUNIOR VESSELS...........85

SCHEDULE 4 FACILITY DOCUMENTS

PART A FIRST PRIORITY ACCOUNT PLEDGES AND SHARE PLEDGES......................89

PART B SOSA SHIP MORTGAGES, ASSIGNMENTS AND SHARE PLEDGES....................92

PART C SOSA SHIPOWNING GUARANTEES............................................96

PART D SNSA GUARANTEE AND SNTG SHIP COLLATERAL DOCUMENTS.....................97

SCHEDULE 5 FORM OF ISSUE REQUEST.............................................99

SCHEDULE 6 CERTIFICATE OF COMPLIANCE........................................101

SCHEDULE 7 FORM OF TRANSFER CERTIFICATE.....................................103

SCHEDULE 8 DISCLOSED PERMITTED DISPOSALS....................................106

SCHEDULE 9 MORTGAGED VESSELS CRITERIA.......................................107

SCHEDULE 10 TERMS OF BANK'S INDEMNITY TO ISSUING BANK.......................109

SCHEDULE 11 MATERIAL LITIGATION.............................................111

SCHEDULE 12 EXISTING ENCUMBRANCES...........................................113

SCHEDULE 13 CONSOLIDATED ACCOUNTS RECEIVABLE AGEING AND COLLECTION
            STATUS AS AT [(] FOR STOLT OFFSHORE S.A.........................114

SCHEDULE 14 OPERATIONAL COVENANTS...........................................115

SCHEDULE 15 THE BANKS UNDER THE EXISTING CREDIT AGREEMENTS..................126

SCHEDULE 16 FORMS OF LOSS PAYABLE CLAUSES...................................127

SCHEDULE 17 FORM OF NOTICE OF ASSIGNMENT OF INSURANCES......................128

SCHEDULE 18 FORM OF ACCESSION AGREEMENT.....................................129

SCHEDULE 19 APPROVED SHIPBROKERS LIST.......................................131

SCHEDULE 20 CASH MANAGEMENT SYSTEM..........................................132

SCHEDULE 21 BONDING FACILITIES..............................................135

SCHEDULE 22 INFORMATION PACKAGE.............................................143

SCHEDULE 23 EXISTING BILATERAL BONDING AGREEMENTS...........................144

SIGNATORIES.................................................................149

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GUARANTEE FACILITY AGREEMENT

Dated: 12 February 2004

BETWEEN:

(1)  SEAWAY (UK) LIMITED, a company incorporated under the laws of England and
     Wales, with its registered office at Dolphin House, Windmill Road, Sunbury
     on Thames, Middlesex TW16 7HT, UK and registered number 00974791 ("Seaway
     UK");

(2)  STOLT OFFSHORE S.A., a company incorporated under the laws of France with
     its registered office at 32, Avenue Pablo Picasso, 92000 Nanterre, France
     ("SO France");

(3)  STOLT OFFSHORE SERVICES S.A., a company incorporated under the laws of
     France with its registered office at 32, Avenue Pablo Picasso, 92000
     Nanterre, France ("SOS France");

(4)  STOLT OFFSHORE AS, a company incorporated under the laws of the Kingdom of
     Norway with its registered office at Verven 4, 4014 Stavanger, the Kingdom
     of Norway ("SO Norway");

(5)  STOLT OFFSHORE LIMITED, a company incorporated under the laws of Scotland
     with its registered office at Bucksburn House, Howes Road, Bucksburn,
     Aberdeen, AB16 7QU, UK and with registered number SC128705 ("SO Scotland");

(6)  STOLT OFFSHORE WEST AFRICA S.A.S.U., a company incorporated under the laws
     of France with its registered office at 32 Avenue Pablo Picasso, 92000
     Nanterre, France ("SO West Africa");

(7)  SOTRAPLEX S.A., a company incorporated under the laws of France with its
     registered office at 32 Avenue Pablo Picasso, 92000 Nanterre, France
     ("Sotraplex");

(8)  STOLT OFFSHORE B.V., a company incorporated under the laws of The
     Netherlands with its registered office at Karel Doormanweg 25, 3115 JD
     Schiedam, The Netherlands ("SO BV");

(9)  ETPM DEEPSEA LIMITED, a company incorporated under the laws of England and
     Wales, with its registered office at Dolphin House, Windmill Road, Sunbury
     on Thames, Middlesex TW16 7HT, UK and registered number 01902584 ("ETPM");

(10) STOLT OFFSHORE INC., a company incorporated under the laws of the State of
     Louisiana, United States of America with its registered office at 322
     Heymann Boulevard, Suite B, Lafayette, Louisiana 70503, United States of
     America ("SO US", and together with Seaway UK, SO France, SOS France, SO
     Norway, SO West Africa, SO Scotland, SO BV, Sotraplex and ETPM, the
     "Original Indemnifiers", and each, an "Original Indemnifier");

(11) STOLT OFFSHORE S.A., a "societe anonyme holding," incorporated under the
     laws of Luxembourg with its registered office at 26 rue Louvingny, L-1946
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     Luxembourg, registered at the R.C.S. Luxembourg under number B 43. 172
     ("SOSA");

(12) the companies listed in Part A of Schedule 1, each being a parent company
     of an Original Indemnifier (each, a "Guarantor", and together with SOSA,
     the "Guarantors");

(13) HSBC BANK PLC as arranger (the "Arranger");

(14) HSBC BANK PLC, CREDIT LYONNAIS and DNB NOR BANK ASA (formerly DEN NORSKE
     BANK ASA) as issuing banks (collectively, the "Issuing Banks", and each, an
     "Issuing Bank");

(15) the banks and financial institutions listed in Part B of Schedule 1, each
     acting through its office at the address indicated against its name in
     Schedule 1 (collectively, the "Banks", and each, a "Bank"); and

(16) HSBC BANK PLC as facility agent and security trustee with its office at
     Level 24, 8 Canada Square, London E14 5HQ, UK (in those capacities, the
     "Agent").

WHEREAS:

(A)  The Original Indemnifiers and SOSA (each of SOSA and SO BV being an
     indirect parent of all the Original Indemnifiers) have requested that the
     Banks and the Issuing Banks provide Bank Guarantees from time to time, upon
     the terms and subject to conditions contained in this Agreement.

(B)  SOSA and the other Guarantors (each being a direct or indirect parent of an
     Original Indemnifier) have agreed to guarantee the Obligations, upon the
     terms and subject to conditions contained in this Agreement.

(C)  Each of the Banks has severally agreed to make available its respective
     Commitment as set forth in Part B of Schedule 1, in the aggregate principal
     amount not exceeding one hundred million Dollars ($100,000,000) for all
     Banks or the Equivalent Amount in a Permitted Currency or Permitted
     Currencies and assume its Proportionate Share of the Banks' Obligations,
     including the indemnity of the Banks in favour of the Issuing Banks in
     respect of each Bank Guarantee issued by an Issuing Bank, upon the terms
     and subject to conditions contained in this Agreement.

(D)  The Indemnifiers have designated the Obligors' Agent as their agent to
     perform certain functions on their behalf as set forth herein in connection
     with the issuance of the Bank Guarantees.

IT IS AGREED as follows:

1    DEFINITIONS AND INTERPRETATION

     1.1  Definitions In this Agreement:

     "Accession Agreement" means an agreement substantially in the form of
     Schedule 18 (Form of Accession Agreement) for the purposes of providing an
     Additional Indemnifier to become a party to this Agreement.

                                       -2-
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     "Account Pledges" means account pledges in the agreed form granted over
     each of Lock Box One and Lock Box Two.

     "Additional Indemnifier" means each trading company that is a member of the
     SO Group that hereafter becomes a party to this Agreement as an Indemnifier
     in accordance with Clause 20.

     "Address for Service" means c/o Stolt Offshore M.S. Limited of 1st Floor,
     Dolphin House, Windmill Road, Sunbury-on-Thames, Middlesex TW16 7HT,
     England or, in relation to any of the Obligors, such other address in
     England and Wales as that Obligor may from time to time designate by no
     fewer than 10 Business Days' written notice to the Agent.

     "Administration" has the meaning given to such term in paragraph 1.1.3 of
     the ISM Code.

     "Applicable Commission Rate" means for any period of determination (i) 1%
     per annum to the extent of the portion of the Bank Guarantee Outstandings
     that is Cash Collateralised and (ii) 3% per annum to the extent of the
     portion of the Bank Guarantee Outstandings that is not Cash Collateralised.

     "Applicable Commitment Rate" means 1.5% per annum.

     "Approved Budget" means the consolidated budget of the SO Group prepared on
     an annual basis by SOSA, commencing with the budget for the financial year
     commencing 1 December 2003 and approved by an Instructing Group, which
     budget shall be in a format consistent with the form of budget dated 18
     November 2003 reviewed by KPMG.

     "Approved Brokers" means a firm or firms of insurance brokers appointed by
     SOSA for the purposes of Schedule 14 and approved in writing by the Agent.

     "Approved Shipbroker" means any of the firms of shipbrokers listed in
     Schedule 19.

     "Assignments" means the Senior Assignments and the Junior Assignments.

     "Bank's Excess Amount" has the meaning given to such term in Clause 14.17.

     "Bank Guarantee" means a performance bond, bid bond, advance payment bond,
     guarantee or standby letter of credit, in a Permitted Currency, in respect
     of a performance obligation of a member of the SO Group, expiring on a Bank
     Guarantee Termination Date and issued under this Agreement, in a form
     acceptable to and approved by the relevant Issuing Bank in its absolute
     discretion.

     "Bank Guarantee Commission" means the commission to be paid by each
     applicable Indemnifier to the Agent pursuant to Clause 12.1.

     "Bank Guarantee Outstandings" means at any time the Dollar equivalent of
     the aggregate of the total amounts in each relevant Permitted Currency
     actually or contingently payable by the Issuing Banks under or pursuant to
     all Bank Guarantees that have been issued hereunder by the Issuing Banks
     and that have not terminated in accordance with their terms, been cancelled
     or, if called or drawn upon, in respect of

                                      -3-
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     which all Obligations related thereto have been paid in full, such Dollar
     equivalence to be determined on the basis of the Agent's spot rate of
     exchange at such time.

     "Bank Guarantee Termination Date" means, in relation to any Bank Guarantee,
     the date falling no later than 60 months after the Issue Date of that Bank
     Guarantee unless otherwise agreed by all the Banks.

     "Banks' Obligations" means all liabilities and obligations of the Issuing
     Banks under or pursuant to the Bank Guarantees, including under or pursuant
     to any renewal, extension or variation of any Bank Guarantee and all
     liabilities and obligations undertaken by each Issuing Bank to any of its
     subsidiaries, affiliates or correspondents in respect of the Bank Guarantee
     or any renewal, extension or variation of any Bank Guarantee.

     "Blueprint" means the "Position Update and Blueprint Stage II" presented to
     the Banks at a syndicate bank briefing held in London and New York on 7
     August 2003.

     "Business Day" means (a) a day on which banks are open for the transaction
     of business of the nature contemplated by this Agreement (and not
     authorised by law to close) in New York City, United States of America;
     London, England; Paris, France; and Oslo, Norway; and (b) in relation to
     the determination of interest rates for Euros only, a day on which the
     Trans-European Automated Real Time Gross Settlement Express System (TARGET)
     is operating.

     "Capital Expenditure" means any expenditure made or obligation incurred
     which in accordance with US GAAP is treated as an addition to the carrying
     amount of a capital asset.

     "Cash Collateral" means the amount of cash deposited by the Obligors'
     Agent, or by an Indemnifier in respect of a Bank Guarantee issued on behalf
     of such Indemnifier, in Lock Box One from time to time as security for its
     Obligations, and the words "Cash Collateralise" or "Cash Collateralised"
     shall have correlative meanings and be interpreted accordingly.

     "Cash Management System" means a system of deposit accounts and
     instructions pursuant to which all cash of the members of the SO Group are
     transferred (i) to Lock Box One, to the extent required by this Agreement
     and (ii) otherwise, to the extent of any operating cash in excess of
     $75,000,000, all as set forth in Schedule 20.

     "Cash Management System Bank" means HSBC Bank plc, or such other bank as
     may be selected by the Agent from time to time to be the bank at which one
     or more of the deposit accounts constituting Lock Box One and Lock Box Two
     are maintained.

     "Casualty Amount" means, in respect of each Vessel, an amount of $1,000,000
     or the equivalent in any other currency.

     "Certificate of Compliance" means a certificate materially in the form set
     forth in Schedule 6, signed by the treasurer or chief financial officer of
     SOSA.

     "Chief Restructuring Officer" means Alix Partners Ltd.

                                      -4-
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     "Commitment" means, in relation to each Bank, the Dollar amount indicated
     against the name of that Bank in Part B of Schedule 1, as cancelled,
     transferred or reduced from time to time in accordance with the terms of
     this Agreement.

     "Commitment Commission" means the commission to be paid by the Obligors'
     Agent to the Agent pursuant to Clause 12.2.

     "Common Shares" means common shares of SOSA of the class outstanding on the
     Execution Date.

     "Communication" means any notice, approval, demand, request or other
     communication from one party to this Agreement to any other party to this
     Agreement.

     "Communications Address" means c/o Stolt Offshore M.S. Limited of 1st
     Floor, Dolphin House, Windmill Road, Sunbury-on-Thames, Middlesex TW16 7HT,
     England, fax no: +44 (0) 1932 773701 marked for the attention of Jolanne
     Le-Faye.

     "Company" means, in relation to any Vessel and at any given time, the
     company responsible for the Vessel's compliance with the ISM Code pursuant
     to paragraph 1.1.2 of the ISM Code.

     "Consolidated Tangible Net Worth" means for SOSA and its Subsidiaries (on a
     consolidated basis) at any time (a) the sum, to the extent shown on SOSA's
     consolidated balance sheet, of (i) the amount of issued and outstanding
     share capital, less the cost of treasury shares, plus (or if negative,
     less) (ii) the amount of surplus and retained earnings, less (b) intangible
     assets as determined in accordance with US GAAP.

     "Covenant Release Date" has the meaning given to such term in Clause
     15.6.1.

     "converted" means actually or notionally (as the case may require)
     converted by the Agent, at the rate at which the Agent, in accordance with
     its usual practice, is able in the London Interbank market to purchase the
     Permitted Currency in which the Facility or part thereof is then
     denominated with the Permitted Currency in which the Facility or part
     thereof is to be denominated, on the second Business Day before the value
     date for that conversion pursuant to Clause 8, and the words "convert" and
     "conversion" shall be interpreted accordingly.

     "Currency of Account" means, in relation to any payment to be made to a
     Finance Party pursuant to any of the Facility Documents, the currency in
     which that payment is required to be made by the terms of the relevant
     Facility Document.

     "Default" means any Event of Default or Potential Event of Default.

     "Default Rate" means the rate at all times of 5% per annum above 3-month
     LIBOR in effect from time to time; the change in the Default Rate being
     effective with each change in 3-month LIBOR.

     "Disclosed Permitted Disposals" means the disposals described in detail in
     the Blueprint and set out in Schedule 8 and, with the prior consent of the
     Agent, disposals

                                      -5-

<PAGE>

     of any asset in lieu of an asset listed in Schedule 8 having a value
     similar to the value of such asset listed in Schedule 8.

     "DOC" means a valid Document of Compliance issued for the relevant Company
     by the Administration pursuant to paragraph 13.2 of the ISM Code.

     "Dollars", "US$" and "$" each means available and freely transferable and
     convertible funds in lawful currency of the United States of America.

     "Dutch Obligor" means SO BV and any other Obligor incorporated under the
     laws of The Netherlands.

     "Earnings", in relation to a Vessel, means all hires, freights, pool income
     and other sums payable to or for the account of a Shipowning Guarantor in
     respect of that Vessel including all remuneration for salvage and towage
     services, demurrage and detention moneys, contributions in general average,
     compensation in respect of any requisition for hire and damages and other
     payments (whether awarded by any court or arbitral tribunal or by agreement
     or otherwise) for breach, termination or variation of any contract for the
     operation, employment or use of the Vessel.

     "Effective Date" means the date on which the conditions set out in Clause
     6.1 have been satisfied and the first Bank Guarantee is issued.

     "Eligible Projects" means projects and contracts of the type generally
     heretofore engaged in by the SO Group in connection with the design,
     procurement, installation and servicing of offshore surface and subsurface
     infrastructure for the global oil and gas industry.

     "Encumbrance" means any mortgage, standard security, charge, pledge, lien,
     assignment, assignation, hypothecation, preferential right, option, title
     retention or trust arrangement or any other agreement or arrangement which,
     in any of the aforementioned instances, has the effect of creating
     security.

     "Environmental Claim" means:

     (a)  any and all enforcement, clean-up, removal or other governmental or
          regulatory action or order or claim instituted or made pursuant to any
          Environmental Law or resulting from a Spill; or

     (b)  any claim made by any other person relating to a Spill.

     "Environmental Incident" means any Spill:

     (a)  from any Vessel; or

     (b)  from any other vessel in circumstances where:

          (i)  any Vessel or its owner, operator or manager may be liable for
               Environmental Claims arising from the Spill (other than
               Environmental Claims arising and fully satisfied before the date
               of this Agreement); and/or

                                      -6-
<PAGE>

          (ii) any Vessel may be arrested or attached in connection with any
               Environmental Claim arising from such Spill.

     "Environmental Law" means a law, regulation or convention concerning
     pollution or protection of human health or the environment.

     "Equity Contribution" means one or more investments in SOSA in an aggregate
     amount of not less $120,000,000 (of which gross cash proceeds shall be not
     less than $100,000,000) from the issuance of Common Shares.

     "Equivalent Amount" means the amount of any Permitted Currency converted
     from the relevant amount of Dollars.

     "Euro" means the currency of participating Member States of the European
     Monetary Union, pursuant to Council Regulation (EC) 974/98 of 3 May 1998,
     (as changed from time to time by the European Communities).

     "Event of Default" means any of the events set out in Clause 17.2.

     "Excess Amount" has the meaning given to such term in Clause 9.1.

     "excess risks" in Schedule 14 means the proportion (if any) of claims for
     general average, salvage and salvage charges and under the ordinary
     collision clause not recoverable in consequence of the value at which the
     relevant Vessel is assessed for the purpose of such claims exceeding its
     insured value.

     "Execution Date" means the date on which this Agreement has been executed
     by each of the parties hereto.

     "Executive Officers" means each of Tom Ehret, Stuart Jackson and Bruno
     Chabas and any replacement for any of them satisfactory to an Instructing
     Group acting reasonably.

     "Existing Credit Agreements" means the $440m Loan Agreement, the $55m/45m
     Loan Agreement, the $44m Facility Agreement and the $28m Reimbursement
     Agreement.

     "Existing Credits" means the aggregate amount outstanding or credit
     extended, as the case may be, at any time under the $440m Loan Agreement,
     the $55m/$45m Loan Agreement, the $44m Facility Agreement and the $28m
     Reimbursement Loan.

     "Existing Facilities Guarantee" means the joint and several guarantee and
     indemnity by the Indemnifiers and the Guarantors of the obligations of,
     inter alios, Stolt Comex Seaway Finance B.V. and Stolt Offshore Inc. under
     the Existing Credit Agreements and the existing bilateral bonding
     agreements set forth in Schedule 23, in the agreed form and executed or to
     be executed in favour of the Security Trustee.

     "Existing SNSA Guarantees" means (i) the guarantee and indemnity agreement
     dated 21 August 2003 executed by SNSA and SNTG as guarantors in favour of
     Den norske Bank ASA (now DnB NOR Bank ASA) as agent pursuant to the $44m
     Facility Agreement; (ii) the guarantee and indemnity agreement dated 30
     June 2003 executed by SNSA and SNTG as guarantors in favour of Nordea Bank
     Norge ASA, Grand

                                      -7-

<PAGE>

     Cayman Branch as agent pursuant to the $55m/$45m Loan Agreement; and (iii)
     the amended and restated guarantee dated 27 August 2003 executed by SNSA in
     favour of Den norske Bank ASA (now DnB NOR Bank ASA) pursuant to the $28m
     Reimbursement Agreement.

     "Facility" means the facility for issuing Bank Guarantees made available by
     the Issuing Banks and the Banks to the Indemnifiers pursuant to this
     Agreement.

     "Facility Amount" means, at any time, the amount of the aggregate
     Commitments at such time (stated in Dollars) less the amount of the
     aggregate Bank Guarantee Outstandings at such time.

     "Facility Availability Period" means the period beginning on the Effective
     Date and ending on the Facility Availability Termination Date.

     "Facility Availability Termination Date" means the date falling 18 months
     after the Execution Date or such earlier date as may result from a
     reduction of the Commitments to zero pursuant to Clause 5.1 or termination
     of availability pursuant to Clause 17.1.

     "Facility Documents" means this Agreement, the Intercreditor, Override and
     Security Trust Deed, the Mortgages together, where applicable, with
     collateral deeds of covenant over the Vessels, the Assignments, the Account
     Pledges, the Shipowners' Guarantees, the Factoring Agreement, the SNSA
     Guarantee, the Share Pledges, and charterer's subordination undertaking and
     any Manager's subordination undertaking executed pursuant to Clause 15.1.2
     or 15.1.3 respectively and any other agreement or document which may at any
     time be executed by any member of the SO Group and/or the SNSA Group
     creating or expressed to create security over all or any part of its assets
     in respect of all or any part of the Obligations of any of the Obligors or
     (where the context requires) any one or more of any of the foregoing.

     "Facility Period" means the period beginning on the Execution Date and
     ending on the date when Bank Guarantees may no longer be issued hereunder
     and all Obligations of all Obligors have been paid or satisfied and
     discharged in full and the Indemnifiers have ceased to be under any further
     actual or contingent liability to the Finance Parties under or in
     connection with any Obligation.

     "Factoring Agreement" means the factoring agreement in relation to the
     assignment of earnings contained in the Junior Assignment over mv "SEAWAY
     FALCON" to be made between the Security Trustee and Stolt Offshore A/S in
     the agreed form.

     "Fee Letter" means the fee letter referred to in Clause 12.5.

     "Finance Parties" means the Arranger, the Issuing Banks, the Banks, the
     Agent and the Security Trustee.

     "French Obligor" means SO France, SOS France, SO West Africa, Sotraplex and
     any other Obligor incorporated under the laws of France.

     "Guarantee" means the guarantee and indemnity of the Guarantors contained
     in Clause 11.

                                      -8-
<PAGE>

     "Indebtedness" means (i) all obligations evidenced by bonds or notes
     payable (whether promissory notes or otherwise), (ii) all indebtedness for
     borrowed money, (iii) capitalised lease obligations on behalf of third
     parties and all contingent liabilities related to debt and capital lease
     obligations which, according to US GAAP, are considered probable and
     estimable, (iv) all obligations for the deferred payment of the purchase
     price for any assets or services (other than trade payables), and (v) all
     reimbursement and other obligations with respect to performance bonds, bank
     guarantees and letters of credit, whether or not matured, net of (vi) the
     amount of any restricted cash deposit which may be applied by the holder of
     a financial obligation referred to above to the repayment of all or part of
     such financial obligation. For the avoidance of doubt Indebtedness shall
     not include obligations under interest rate and currency hedging agreements
     entered into by any member of the SO Group in the ordinary course of
     trading and daylight overdraft exposures.

     "Indemnifiers" means, collectively, the Original Indemnifiers and all
     Additional Indemnifiers, if any, and an "Indemnifier" means any one of
     them.

     "Information Package" means the Blueprint and the other information
     delivered prior to the Execution Date to the Banks and identified in
     Schedule 22.

     "Instructing Group" means any one or more Banks whose combined
     Proportionate Shares equal or exceed sixty six and two thirds per cent
     (66?%).

     "Insurance Adviser" means HSBC Insurance Brokers Limited or such other
     independent insurance adviser as may be selected by the Agent from time to
     time to advise the Agent on the adequacy of the Insurances and compliance
     with the insurance obligations set out in this Agreement.

     "Insurance Proceeds Amount" means, in respect of (i) each Senior Vessel or
     (ii) in the event that all Indebtedness under an Existing Credit Agreement
     secured by a prior Encumbrance thereon has been repaid or fully Cash
     Collateralised, in respect of that particular Junior Vessel, the amount of
     insurance proceeds payable in respect of such Senior Vessel or such Junior
     Vessel (after payment or Cash Collateralisation of the Indebtedness under
     the Existing Credit Agreement) in the event of a Total Loss or any other
     claim.

     "Insurances" means all policies and contracts of insurance (including hull
     and machinery, all entries in protection and indemnity or war risks
     associations) which are from time to time taken out or entered into in
     respect of or in connection with the Vessels or their increased value and
     (where the context permits) all benefits thereof, including all claims of
     any nature and returns of premium.

     "Intercreditor, Override and Security Trust Deed" means the intercreditor,
     override and security trust deed in the agreed form to be entered into
     between, inter alios, the Security Trustee, the Indemnifiers, the
     Guarantors, DnB NOR Bank ASA and Nordea Bank Norge ASA, Grand Cayman
     Branch, as agents under the Existing Credit Agreements, DnB NOR Bank ASA as
     lender and Stolt Offshore, Inc as borrower under the $28m Reimbursement
     Agreement, the Agent, the Banks and the Issuing Banks.

     "Interest" means interest at the Default Rate.

                                      -9-
<PAGE>

     "ISM Code" means the International Management Code for the Safe Operation
     of Ships and for Pollution Prevention (as amended, including any regulation
     issued thereunder), as adopted by the Assembly of the International
     Maritime Organisation on 4 November 1993 by resolution A.741 (18) and
     incorporated on 19 May 1994 as chapter IX of the Safety of Life at Sea
     Convention 1974.

     "Issue Date", in relation to any Bank Guarantee, means the date on which
     that Bank Guarantee is issued by an Issuing Bank pursuant to Clause 4.

     "Issue Request" means a request, substantially in the form set out in
     Schedule 5, made by the Obligors' Agent to the Agent for the issuance of a
     Bank Guarantee.

     "Junior Assignments" means the second priority deeds of assignment of the
     Insurances, Earnings and Requisition Compensation of each Junior Vessel, in
     the agreed form, executed or to be executed in favour of the Security
     Trustee or, in respect of any Junior Vessel of a member of the SNSA Group,
     in favour of the Agent.

     "Junior Mortgages" means the second priority and/or second preferred
     mortgages over each Junior Vessel, in the agreed form, executed or to be
     executed in favour of the Security Trustee or, in respect of any Junior
     Vessel of a member of the SNSA Group, in favour of the Agent.

     "Junior Shipowners' Guarantees" means the subordinated guarantees and
     indemnities of the Junior Shipowning Guarantors that are members of the SO
     Group, in the agreed form, executed or to be executed in favour of the
     Security Trustee.

     "Junior Shipowning Guarantors" means the companies listed in Schedule 3
     each being incorporated according to the law of the country indicated
     against its name in Schedule 3.

     "Junior Vessels" means the vessels listed in Schedule 3.

     "law" means any law, statute, treaty, convention, regulation, instrument or
     other subordinate legislation or other legislative or quasi-legislative
     rule or measure, or any order or decree of any government, judicial or
     public or other body or authority, or any directive, code of practice,
     circular, guidance note or other direction issued by any competent
     authority or agency (whether or not having the force of law).

     "Liabilities" has the meaning given to such term in Clause 4.5.1.

     "LIBOR" means the rate, rounded to the nearest four decimal places
     downwards (if the digit displayed in the fifth decimal place is 1, 2, 3 or
     4) or upwards (if the digit displaced in the fifth decimal place is 5, 6,
     7, 8 or 9) displayed on the telerate page 3750 or, as the case may be, 3740
     (or such other page or pages which replace(s) either such page for the
     purposes of display of offered rates of leading banks), for deposits in the
     Currency of Account of amounts equal to the amount of the relevant Bank
     Guarantee Outstandings for a 3 month period or if there is no such display
     rate then available for the Currency of Account for an amount comparable to
     the relevant Bank Guarantee Outstandings, the arithmetic mean (rounded
     upwards, if necessary, to the nearest whole multiple of 1/16%) of the
     respective rates offered to the Agent for

                                      -10-

<PAGE>

     deposits in the Currency of Account for a 3 month period by prime banks in
     the London Interbank market.

     "Lock Box One" means collectively one or more accounts each in the name of
     the Obligors' Agent with the Cash Management System Bank denominated in
     Dollars, over which the Agent has a perfected, valid and legally
     enforceable fixed charge pursuant to an Account Pledge.

     "Lock Box Two" means collectively one or more accounts each in the name of
     the Obligors' Agent with the Cash Management System Bank denominated in a
     Permitted Currency acceptable to the Cash Management System Bank over which
     the Security Trustee has a perfected, valid and legally enforceable
     floating charge pursuant to an Account Pledge.

     "Loss Payable Clauses" means the provisions regulating the manner of
     payment of sums receivable under the Insurances which are to be
     incorporated in the relevant insurance documents, such Loss Payable Clauses
     to be in substantially the forms set out in Schedule 16, or in such other
     forms as may from time to time be agreed in writing by the Agent.

     "Management Agreement" means, in relation to any Vessel, the agreement made
     between the Manager and the relevant Shipowning Guarantor in respect of the
     management of such Vessel.

     "Manager" means (i) any member of the SO Group or (ii) such other
     commercial and/or technical manager of a Vessel nominated by the Shipowning
     Guarantors and approved by the Agent in its discretion.

     "Material Adverse Effect" means a material adverse effect on:

     (a)  the business, condition (financial or otherwise), operations,
          performance, properties or prospects of the SO Group taken as a whole;

     (b)  the ability of any member of the SO Group to perform its payment
          obligations under any Facility Document; or

     (c)  the validity or enforceability of the Facility Documents or the rights
          or remedies of any Finance Party under the Facility Documents.

     "Mortgaged Vessel" means, at any relevant time, any Vessel over which the
     Security Trustee or the Agent, as they case may be, has a perfected first
     or second priority lien and the Agent has received the documentation listed
     in Schedule 9; provided however that a Mortgaged Vessel that suffers a
     Total Loss remains a Mortgaged Vessel until the expiry of the period
     referred to in Clause 17.2.11(b).

     "Mortgaged SOSA Vessel" means, at any relevant time, any Vessel owned by a
     member of the SO Group which is a Mortgaged Vessel.

     "Mortgagees' Insurances" means all policies and contracts of mortgagees'
     interest insurance and any other insurance of the type referred to in
     paragraph 5(a)(bb) of Schedule 14 from time to time taken out in respect of
     any Vessel of a member of the

                                      -11-
<PAGE>

     SNSA Group, by or for the benefit of the Agent, or in respect of any other
     Vessel, the Security Trustee, on behalf of the Finance Parties pursuant to
     this Agreement.

     "Mortgages" means the Senior Mortgages and the Junior Mortgages.

     "Net Disposal Proceeds" means the proceeds (including any amount received
     in repayment of intercompany debt in connection with such disposal) of any
     disposal by any member of the SO Group or other Shipowning Guarantor after
     deducting:

     (a)  reasonable fees and out-of-pocket expenses incurred by the seller in
          connection with such disposal;

     (b)  any amount necessary to discharge any liability to any creditor with a
          priority claim over the disposal proceeds provided it is so applied;

     (c)  VAT paid or payable by the seller in connection with such disposal;
          and

     (d)  any other tax incurred and required to be paid by the seller in
          connection with such disposal (as reasonably determined by the seller,
          acting in good faith, on the basis of existing rates and taking
          account of any available credit, deduction or allowance).

     "Norwegian Kroner" means available and freely transferable and convertible
     funds in the lawful currency of the Kingdom of Norway.

     "Norwegian Obligor" means SO Norway and any other Obligor incorporated
     under the laws of the Kingdom of Norway.

     "Notice of Assignment of Insurances" means a notice of assignment in the
     form set out in Schedule 17, or in such other form as may from time to time
     be required or agreed in writing by the Agent.

     "Obligations" means all of the liabilities and obligations (including an
     obligation to provide cash cover or deposit cash) of each Obligor to any of
     the Finance Parties under or pursuant to this Agreement and each other
     Facility Document to which such Obligor is a party, whether actual or
     contingent, present or future and whether incurred alone or jointly or
     jointly and severally with the other Obligor and in whichever currency,
     including interest, commission and all other charges and expenses.

     "Obligors" means, collectively, the Indemnifiers, the Guarantors, the
     Shipowning Guarantors, the Pledgors, the Obligors' Agent, SNSA, SNTG and
     any other member of the SO Group which is at any time during the Facility
     Period liable for, or has provided security for, all or any part of the
     Obligations, and "Obligor" means any one of them; provided, however, that
     for purposes of Clause 7, Clause 15 and Clause 17), the term Obligor or
     Obligors does not include SNSA or SNTG or any Shipowning Guarantor that is
     not a member of the SO Group.

     "Obligors' Agent" means Seaway UK or any other Indemnifier or Guarantor
     designated by SOSA as the agent of the Indemnifiers to perform certain
     functions on their behalf as set forth herein in connection with the
     issuance of the Bank Guarantees, and approved by the Agent.

                                      -12-
<PAGE>

     "Paying Obligor" has the meaning given to such term in Clause 1.3.4.

     "Permitted Currency" means (i) Dollars, (ii) Euros, (iii) Sterling, (iv)
     Norwegian Kroner, and (v) to the extent selected by an Indemnifier and
     acceptable to an Instructing Group in their discretion, any other lawful
     currency, including that of Indonesia (namely Indonesian Rupiah), Tunisia
     (namely Tunisian Dinar), Saudi Arabia (namely Saudi Riyal) and India
     (namely Indian Rupiah).

     "Permitted Indebtedness" means (i) the Existing Credits, (ii) Permitted
     Short Term Indebtedness, (iii) Subordinated Debt up to $50,000,000, (iv)
     Indebtedness outstanding under the SNSA Liquidity Line, (v) any
     Indebtedness that refinances the Existing Credits but not in excess of the
     amount outstanding at the time of such refinancing, (vi) any Indebtedness
     arising under the Facility Documents, (vii) any Indebtedness under the
     existing bonding facilities set forth in Schedule 21 for the amounts
     existing at the Execution Date, (viii) unsecured Indebtedness under any
     bonding facility entered into by a member of the SO Group after the date
     hereof, (ix) upon approval of the Agent, acting on the instructions of an
     Instructing Group, any other Indebtedness under any bonding facility
     entered into by a member of the SO Group after the date hereof, (x) after
     the Facility Availability Termination Date, any other Indebtedness under
     any secured bonding facility entered into by a member of the SO Group after
     the date hereof for which collateral (including cash collateral not
     exceeding $25,000,000) is permitted by the Intercreditor, Override and
     Security Trust Deed, and (xi) other Indebtedness in respect of local
     bonding facilities not exceeding $3,000,000 in the aggregate at any one
     time outstanding.

     "Permitted Liens" means (i) any Encumbrance for salvage and any Encumbrance
     arising either by operation of law or which is otherwise incidental to the
     normal conduct of the business of the relevant Obligor which is discharged
     in the ordinary course of business but in any event does not exist for more
     than 60 days; (ii) any Encumbrance created pursuant to the Existing Credit
     Agreements and existing on the Execution Date; (iii) any Encumbrance
     arising under or evidenced by any Facility Document; (iv) any Encumbrance
     existing on the date of this Agreement and listed in Schedule 12; or (v)
     any Encumbrance relating to assets which become the property of the SO
     Group after the date of this Agreement provided that such Encumbrance was
     not created in anticipation or in connection with such acquisition (unless
     reflected in the Approved Budget) and does not extend to any assets other
     than those acquired (including accounts receivable attributable thereto
     where such accounts receivables security interest is ancillary to the
     security interest in the associated fixed costs as part of an asset based
     financing).

     "Permitted Short Term Indebtedness" means any unsecured indebtedness of the
     SO Group (other than intercompany indebtedness of the SO Group) incurred
     for working capital and short term liquidity in an amount of up to
     $75,000,000.

     "Pledgors" means each company which executes a Share Pledge and/or an
     Account Pledge.

     "Pollutant" means and includes oil and its products, any other polluting,
     toxic or hazardous substance and any other substance whose release into the
     environment is regulated or penalised by Environmental Laws.

                                      -13-
<PAGE>

     "Potential Event of Default" means any event which, with the giving of
     notice or the passage of time or both, would constitute an Event of
     Default.

     "Pounds Sterling", "Sterling" and "(pound)" each means the lawful currency
     for the time being of the United Kingdom.

     "Principal Subsidiary" means any member of the SO Group having total assets
     exceeding 10% of the consolidated assets of the SO Group and/or having
     during the last four fiscal quarters accounted for more than 10% of the
     consolidated turnover of the SO Group. "Proceedings" means any suit, action
     or proceedings begun by any of the Finance Parties arising out of or in
     connection with the Facility Documents.

     "Proportionate Share" means, for each Bank, its percentage of the
     Commitments (or following the Effective Date, the Bank Guarantee
     Outstandings, if any) indicated against the name of that Bank in Part B of
     Schedule 1, as amended by any Transfer Certificate executed from time to
     time.

     "protection and indemnity risks" in Schedule 14 means the usual risks
     (including oil and pollution cover) covered by a United Kingdom protection
     and indemnity association or a protection and indemnity association which
     is managed in London (including the proportion (if any) of any sums payable
     to any other person or persons in case of collision which are not
     recoverable under the hull and machinery policies by reason of the
     incorporation in such policies of Clause 8 of the Institute Time Clauses
     (Hulls) (1/11/95) or the Institute Amended Running Down Clause (1/10/71) or
     any equivalent provision).

     "Qualifying Collateral" means the Cash Collateral and the Mortgaged SOSA
     Vessels.

     "Registrar of Ships" means, in relation to any Vessel, the registrar,
     commissioner or representative of the state or territory in which such
     Vessel is registered who is duly authorised and empowered to register the
     Vessel, the relevant Mortgage and the relevant Management Agreement.

     "Relevant Currency" means, in respect of all or any part of the Banks'
     Obligations, the currency in which the Agent is liable to make payment of
     that part of the Banks' Obligations.

     "Repeating Representations" means the representations and warranties
     contained in Clauses 7.1, 7.3, 7.4 and 7.5.

     "Requisition Compensation" means all compensation or other money which may
     from time to time be payable to the Shipowning Guarantors as a result of
     any Vessel being requisitioned for title or in any other way compulsorily
     acquired (other than by way of requisition for hire).

     "Security Trustee" has the meaning given to such term in the Intercreditor,
     Override and Security Trust Deed.

                                      -14-
<PAGE>

     "Senior Assignments" means the first priority deeds of assignment of the
     Insurances, Earnings and Requisition Compensation in respect of each Senior
     Vessel, in the agreed form, executed or to be executed in favour of the
     Security Trustee.

     "Senior Mortgages" means the first priority and/or first preferred
     mortgages over each Senior Vessel, in the agreed form, executed or to be
     executed in favour of the Security Trustee.

     "Senior Shipowners' Guarantee" means the guarantees and indemnities of the
     Senior Shipowning Guarantors, in the agreed form, executed or to be
     executed in favour of the Security Trustee.

     "Senior Shipowning Guarantors" means the companies listed in Schedule 2
     each being incorporated according to the law of the country indicated
     against its name in Schedule 2.

     "Senior Vessels" means the vessels listed in Schedule 2.

     "Share Pledges" means the first priority pledges or charges over shares or
     other equity interests of certain members of the SO Group, in the agreed
     form, executed or to be executed in favour of the Security Trustee
     including the Share Pledges listed in Part A and Part B of Schedule 4.

     "Shipowners' Guarantees" means the Junior Shipowners' Guarantees and the
     Senior Shipowners' Guarantees.

     "Shipowning Guarantors" means the Junior Shipowning Guarantors and the
     Senior Shipowning Guarantors.

     "SMC" in relation to any Vessel means a valid safety management certificate
     issued for the Vessel by or on behalf of the Administration pursuant to
     paragraph 13.4 of the ISM Code.

     "SMS" in relation to any Vessel, means a safety management system for the
     Vessel developed and implemented in accordance with the ISM Code and
     including the functional requirements, duties and obligations required by
     the ISM Code.

     "SNSA" means Stolt-Nielsen S.A., a company incorporated under the laws of
     Luxembourg with its registered office at 23 Avenue Monterey, L-2086
     Luxembourg.

     "SNSA Guarantee" means the guarantee and indemnity of SNSA and SNTG for
     such portion of the Obligations from time to time that when aggregated with
     the Indebtedness guaranteed by the Existing SNSA Guarantees results in the
     total amount of Indebtedness of the SO Group guaranteed by SNSA and SNTG
     not exceeding $96,000,000, in the agreed form and executed or to be
     executed in favour of the Agent.

     "SNSA Group" means SNSA and its Subsidiaries.

     "SNSA Liquidity Line" means the committed line of credit in the amount of
     $50,000,000 extended by SNTG to members of the SO Group pursuant to the
     facility agreement dated as of 30 June 2003 and restated as of 21 August
     2003 for working

                                      -15-
<PAGE>

     capital and other corporate purposes for a period ending on or after 30
     November 2004, the availability of such committed line of credit guaranteed
     by SNSA on 30 June 2003.

     "SNTG" means Stolt-Nielsen Transportation Group Ltd., a corporation
     incorporated under the laws of Liberia with its registered office at 80
     Broad Street, Monrovia, Liberia.

     "SO Group" means SOSA and its Subsidiaries.

     "Spill" means any actual or threatened emission, spill, release or
     discharge of a Pollutant into the environment.

     "Subordinated Debt" means the $50,000,000 of subordinated debt originally
     loaned to SO BV by SNTG.

     "Subordinated Note" means a note in form and substance satisfactory to the
     Agent dated 30 June 2003 evidencing the Subordinated Debt or any portion
     thereof.

     "Subsidiary" means a subsidiary undertaking, as defined in section 258
     Companies Act 1985 or any analogous definition under any other relevant
     system of law.

     "Surety" means any person (other than any Indemnifier or any Guarantor) who
     has given or who may in the future give to the Finance Parties or any of
     them any security, guarantee or indemnity for or in relation to the
     Obligations of an Indemnifier.

     "Taxes" means all taxes, levies, imposts, duties, charges, fees, deductions
     and withholdings (including any related interest and penalties) and any
     restrictions or conditions resulting in any charge, other than taxes
     levies, imposts, duties, charges, fees, deductions and withholdings
     (including any related interest and penalties) on the overall net income of
     a Finance Party or branch thereof, and "Tax" and "Taxation" shall be
     interpreted accordingly.

     "Total Loss", in relation to any Vessel means:

     (a)  an actual, constructive, arranged, agreed or compromised total loss of
          that Vessel; or

     (b)  the requisition for title, compulsory acquisition, nationalisation or
          expropriation of that Vessel by or on behalf of any government or
          other authority (other than by way of requisition for hire); or

     (c)  the capture, seizure, arrest, detention or confiscation of that
          Vessel, unless the Vessel is released and returned to the possession
          of the relevant Shipowning Guarantor within two months after such
          capture, seizure, arrest, detention or confiscation.

     "Transfer Certificate" means a certificate materially in the form set forth
     in Schedule 7 signed by a Bank and a Transferee whereby:

                                      -16-
<PAGE>

     (a)  such Bank seeks to procure the transfer to such Transferee of all or a
          part of such Bank's rights and obligations under this Agreement upon
          and subject to the terms and conditions set out in Clause 21.4; and

     (b)  such Transferee undertakes to perform the obligations it will assume
          as a result of delivery of such certificate to the Agent as is
          contemplated in Clause 21.4.

     "Transfer Date" means, in relation to any Transfer Certificate, the
     effective date for the transfer determined in accordance with Clause 21.4.

     "Transferee" means a bank or other financial institution to which a Bank
     seeks to transfer all or part of such Bank's rights and obligations under
     this Agreement.

     "Trust Property" means:

     (a)  the benefit of the covenant contained in Clause 14; and

     (b)  all benefits arising under (including all proceeds of the enforcement
          of) each of the Facility Documents (other than this Agreement), with
          the exception of any benefits arising solely for the benefit of the
          Issuing Banks or the Agent.

     "US GAAP" means the generally accepted accounting principles in the United
     States of America, from time to time in effect, provided that if SOSA
     wishes or is required by US GAAP to change accounting principles within the
     applicable rules of US GAAP, SOSA shall notify the Agent together with an
     explanation of the effects on the financial covenants contained in this
     Agreement. Should an Instructing Group and/or SOSA find that such change
     will impact upon the result of the calculation of the financial covenants
     contained in this Agreement, an Instructing Group will, following
     consultation with SOSA, stipulate amendments to the financial covenants so
     that the ratio of SO Group's performance in respect of the covenants
     reflects the position which would have been the case had no changes to
     SOSA's accounting principles taken place and pending such agreement
     compliance with such covenants shall be calculated as if such change had
     not been made.

     "US Obligor" means SO US or Stolt Comex Seaway Holdings Inc. and any other
     Obligor incorporated under the laws of any State of the United States of
     America.

     "Value of Qualifying Collateral" means at any time of determination, (i)
     the Value of Qualifying Vessel Collateral at such time, plus (ii) an amount
     equal to 100% of the Cash Collateral at such time; provided, however, that
     in the event that applicable law or any Facility Document limits any
     portion of the Qualifying Collateral from securing all of the Obligations,
     the value attributable to such portion of the Qualifying Collateral
     pursuant to the foregoing calculations shall not exceed the amount of
     Obligations outstanding at such time which are secured by such portion of
     the Qualifying Collateral.

     "Value of Qualifying Vessel Collateral" means, at any time of
     determination, an amount equal to the aggregate of the most recent
     Valuations of all Mortgaged SOSA Vessels at such time; provided, however,
     that (i) in respect of any Junior Vessel of a member of the SO Group, the
     value attributable to such Junior Vessel shall be the

                                      -17-
<PAGE>

     difference, if any, between the value of such Junior Vessel and 120% of the
     principal amount of the Indebtedness secured by any prior Encumbrance on
     such Junior Vessel and (ii) in the event that applicable law or any
     Facility Document limits any portion of the Qualifying Collateral from
     securing all of the Obligations, the value attributable to such portion of
     the Qualifying Collateral pursuant to the foregoing calculations shall not
     exceed the amount of Obligations outstanding at such time which are secured
     by such portion of the Qualifying Collateral.

     "Valuation" means, in relation to a Vessel, the arithmetic mean of the most
     recent written valuations of that Vessel expressed in Dollars prepared by
     two firms from the list of Approved Shipbrokers, one appointed by the Agent
     and the other appointed by the Obligors' Agent, unless either the Agent or
     the Indemnifiers disagree with either one of such valuations, in which
     event the Agent shall appoint a third firm from the list of Approved
     Shipbrokers and the valuation of the Vessel shall be the arithmetic average
     of all three such valuations. Such valuations shall be prepared at the
     Indemnifier's expense, without a physical inspection (unless such physical
     inspection is requested by the Agent), on the basis of a sale for prompt
     delivery for cash at arm's length between a willing buyer and a willing
     seller without the benefit of any charterparty or other engagement unless
     an alternative basis of valuation is requested by the Agent, and shall not
     include any item of equipment of material value on board of any Vessel
     which are not owned by the relevant Shipowning Guarantor or are not an
     integral part of the relevant Vessel.

     "VAT" means value added tax charged in accordance with the provisions of
     the Value Added Tax Act 1994, and any other tax on value or turnover which
     is enacted in addition to or in substitution for it and any other tax of a
     similar nature which may be imposed in any jurisdiction from time to time.

     "Vessels" means the Senior Vessels and the Junior Vessels, and in each case
     everything now or in the future belonging to them on board and ashore.

     "war risks" in Schedule 14 includes those risks covered by the standard
     form of English marine policy with Institute War and Strikes Clauses Hull -
     Time (1/11/95) attached or similar cover.

     "$28m Reimbursement Agreement" means the amended and restated reimbursement
     agreement dated 27 August 2003 between Stolt Offshore, Inc. as borrower and
     Den norske Bank ASA (now DnB NOR Bank ASA) as lender.

     "$28m Reimbursement Loan" means the aggregate amount outstanding at any
     time under the $28m Reimbursement Agreement.

     "$44m Facility Agreement" means the $44,000,000 secured guarantee facility
     dated 21 August 2003 made between Stolt Comex Seaway Finance B.V., SOSA,
     the banks listed in Schedule 1 thereto as lenders and Den norske Bank ASA
     (now DnB NOR Bank ASA) as agent, security trustee and issuing bank.

     "$440m Loan Agreement" means the $440,000,000 multicurrency revolving
     credit agreement dated 22 September 2000 between (inter alios) Stolt Comex
     Seaway Finance B.V. as borrower, SOSA as guarantor, the Banks and others,
     as lenders, Den

                                      -18-
<PAGE>

     norske Bank ASA (now DnB NOR Bank ASA) as facility agent and security
     trustee and Den norske Bank ASA (now DnB NOR Bank ASA) and others as
     arrangers.

     "$55m/$45m Loan Agreement" means the amended and restated $55,000,000 loan
     and $45,000,000 guarantee facility agreement dated 9 July 2002 made between
     Stolt Comex Seaway Finance B.V., SOSA, the banks listed in schedule 1
     thereto as lenders and Nordea Bank Norge ASA, Grand Cayman Branch as agent
     and security trustee.

     1.2  Interpretation In this Agreement:

          1.2.1     words denoting the plural number include the singular and
                    vice versa;

          1.2.2     words denoting persons include corporations, partnerships,
                    associations of persons (whether incorporated or not) or
                    governmental or quasi-governmental bodies or authorities and
                    vice versa;

          1.2.3     references to Recitals, Clauses and Schedules are references
                    to recitals and clauses of and schedules to, this Agreement;

          1.2.4     references to this Agreement include the Recitals and the
                    Schedules;

          1.2.5     the headings and contents page(s) are for the purpose of
                    reference only, have no legal or other significance, and
                    shall be ignored in the interpretation of this Agreement;

          1.2.6     references to any document (including, without limitation,
                    to all or any of the Facility Documents) are, unless the
                    context otherwise requires, references to that document as
                    amended, supplemented, novated or replaced from time to
                    time;

          1.2.7     references to statutes or provisions of statutes are
                    references to those statutes, or those provisions, as from
                    time to time amended, varied, replaced or re-enacted;

          1.2.8     references to any of the Finance Parties include its
                    successors, Transferees and permitted assignees;

          1.2.9     references to times of day are to London time unless
                    otherwise stated;

          1.2.10    the term "including" when used in any Facility Document
                    means including without limitation except in the computation
                    of time periods;

          1.2.11    the words "herein", "hereof" and "hereunder" and similar
                    words refer to this Agreement as a whole, and not to any
                    particular Clause in or Schedule to this Agreement;

          1.2.12    a reference to a document in the "agreed form" means a
                    document in the form scheduled to this Agreement or agreed
                    between SOSA and the Agent; and

          1.2.13    a reference to "set-off" shall be construed so as to include
                    analogous rights under the applicable laws of any relevant
                    jurisdiction.

                                      -19-
<PAGE>

     1.3  Joint and Several Liability of Obligors; Limitations and Rights of
          Contribution

          1.3.1     All guarantees, obligations, covenants, representations,
                    warranties and undertakings in or pursuant to the Facility
                    Documents assumed, given, made or entered into by any
                    Indemnifier or any Guarantor shall be to the fullest extent
                    permitted by applicable law assumed, given, made or entered
                    into by the Indemnifiers and the Guarantors jointly and
                    severally; provided, however, that notwithstanding the
                    foregoing:

                    (a)  the Obligations of any Norwegian Obligor under this
                         Agreement and under any other Facility Document shall
                         not extend to any Obligation which, if such Obligation
                         did so extend, would cause an infringement of any
                         applicable mandatory laws in the Kingdom of Norway,
                         including sections 8-7 cf. sections 1-3 cf. 1-4 of the
                         Norwegian Limited Liability Companies Act 1997; and

                    (b)  the Obligations of:

                         (i)  any French Obligor, other than Serimer SARL and
                              Stolt Comex Seaway S.A., under this Agreement and
                              under any other relevant Facility Document after
                              giving effect to Clauses 1.3.3 and 1.3.4 shall be
                              for a maximum amount corresponding to 95%, and

                        (ii)  Serimer SARL or Stolt Comex Seaway S.A. under any
                              relevant Facility Document after giving effect to
                              Clauses 1.3.3 and 1.3.4 shall be for a maximum
                              amount corresponding to 80%,

                         of the higher of the Net Worth of such French Obligor
                         on the Execution Date and the Net Worth of such French
                         Obligor at the time of enforcement of such Obligation,
                         and any interest, indemnities, fees and accessories,
                         shall be limited to the value of the securities
                         ("instruments financiers"), monies and other rights and
                         security interests registered in or granted pursuant to
                         any relevant Facility Document. For purposes hereof,
                         "Net Worth" means, in respect of any French Obligor,
                         such French Obligor's net worth ("capitaux propres")
                         (including the registered share capital, share premium,
                         legal and statutory reserves, other reserves, profits
                         or losses carried forward, investment subsidies and
                         regulated provisions) as shown in the most recent
                         financial statements ("comptes annuels") of such French
                         Obligor as certified by the statutory auditors and
                         available at the Execution Date or the date of its
                         enforcement hereunder, as the case may be.

          1.3.2     Any term or provision of this Agreement or any other
                    Facility Document to the contrary notwithstanding, the
                    maximum aggregate amount of the Obligations for which any US
                    Obligor shall be liable shall not exceed the maximum amount
                    for which it can be liable without rendering this Agreement
                    or any other Facility Document, as it relates to such US
                    Obligor, subject to avoidance under applicable law relating
                    to fraudulent conveyance

                                      -20-
<PAGE>

                    or fraudulent transfer (including Section 548 of the
                    Bankruptcy Code or any applicable provisions of comparable
                    state law).

          1.3.3     To the extent that any Indemnifier or any Guarantor other
                    than SOSA and SO BV shall be required hereunder to pay a
                    portion of the Obligations in excess of the amount of
                    economic benefit actually received by such Indemnifier or
                    such Guarantor, SOSA and SO BV, jointly and severally, agree
                    to reimburse each such Indemnifier and each such Guarantor
                    for such excess.

          1.3.4     To the extent that any Indemnifier or any Guarantor other
                    than SOSA and SO BV (a "Paying Obligor") shall be required
                    hereunder to pay a portion of the Obligations exceeding the
                    greater of (a) the amount of the economic benefit actually
                    received by such Paying Obligor from the Facility and (b)
                    the amount such Paying Obligor would otherwise have paid if
                    such Paying Obligor had paid the aggregate amount of the
                    Obligations (excluding the amount thereof repaid by other
                    Indemnifiers or Guarantors) in the same proportion as the
                    net worth of such Paying Obligor at the Execution Date bears
                    to the aggregate net worth of all the Indemnifiers or
                    Guarantors, as the case may be, at the Execution Date, then
                    each other such Indemnifier and each other such Guarantor,
                    as the case may be, agrees to reimburse the Paying Obligor
                    for the amount of such excess, pro rata, based on the
                    respective net worths of such other Indemnifiers and the
                    Guarantors, as the case may be, at the Execution Date (it
                    being stipulated, for the avoidance of doubt, that the
                    aggregate liability of any French Obligor under Clause 1.3.1
                    and under this Clause 1.3.4 shall not exceed the maximum
                    amount referred to in Clause 1.3.1(b).

          1.3.5     To the extent that the Obligors' Agent shall pay any of the
                    Obligations, including by way of application of any funds
                    deposited by the Obligors' Agent in Lock Box One or Lock Box
                    Two, the intercompany debt owed by the Obligors' Agent to
                    SOSA or SO BV shall be pro tanto reduced and deemed
                    satisfied and discharged.

          1.3.6     Each of the Indemnifiers and the Guarantors agrees that any
                    rights which it may have at any time during the Facility
                    Period by reason of the performance of its obligations under
                    the Facility Documents to be indemnified or reimbursed by or
                    to receive contribution from or to have rights of
                    subrogation against any other Indemnifier, Guarantor or
                    Surety and/or to take the benefit of any security taken by
                    the Finance Parties pursuant to the Facility Documents shall
                    be exercised, delayed or subordinated to the Obligations, in
                    such manner and on such terms as the Agent may require. Each
                    of the Indemnifiers and the Guarantors further agrees to
                    hold any sums received by it as a result of its having
                    exercised any such right on trust for the Agent absolutely.
                    This provision shall in no way limit Clause 4.5.4.

          1.3.7     Each of the Indemnifiers and the Guarantors agrees that it
                    will not at any time during the Facility Period claim any
                    set-off or counterclaim against any other Indemnifier or
                    Guarantor in respect of any liability owed to it by any
                    other Indemnifier or Guarantor, nor prove in competition
                    with any

                                      -21-
<PAGE>

                    Finance Party in any liquidation of (or analogous proceeding
                    in respect of) any other Indemnifier or Guarantor in respect
                    of any payment made under the Facility Documents or in
                    respect of any sum which includes the proceeds of
                    realisation of any security held by any of the Finance
                    Parties for the repayment of the Obligations.

          1.3.8     Subject to the Intercreditor, Override and Security Trust
                    Deed, the Finance Parties shall be free, and are hereby
                    authorised by the Obligors, to apply any payment from any
                    Obligor and any recovery from enforcement of any security to
                    such of the Obligations in such order and at such time as
                    will maximise the recovery of the Finance Parties in respect
                    of all of the Obligations and there shall be no marshalling
                    obligation imposed upon any Finance Party or asserted
                    against it.

          1.3.9     Each of the Indemnifiers appoints the Obligors' Agent as its
                    agent for the purposes set forth in this Agreement and
                    hereby ratifies, confirms and approves all actions taken by
                    the Obligors' Agent in connection with this Agreement.
                    Notwithstanding that the actions of the Obligors' Agent may
                    affect rights and obligations of any Obligor, and without
                    further reference to or the consent of such Obligor, such
                    Obligor shall, as regards each of the other parties to this
                    Agreement and the other Facility Documents, be bound thereby
                    as though it has itself taken such action.

2    THE FACILITY

     2.1  The Facility  Subject to the terms of this Agreement, the Banks grant
          to the Indemnifiers the Facility whereby during the Facility
          Availability Period the Banks, when requested by the Obligors' Agent
          pursuant to an Issue Request, will procure an Issuing Bank to issue,
          for the account of each Indemnifier referred to in any such Issue
          Request, Bank Guarantees denominated in a Permitted Currency, up to an
          aggregate principal amount at any one time outstanding not to exceed
          the Facility Amount at such time.

     2.2  Nature of the Banks' rights and obligations hereunder

          2.2.1     Banks' Commitments  No Bank is obliged to participate in the
                    issuance of any Bank Guarantee if to do so would cause the
                    aggregate amount of its maximum potential liability directly
                    and/or under Clause 4.6 in respect of the Bank Guarantee
                    Outstandings (being in the case of any Issuing Bank in
                    respect of any Bank Guarantee issued hereunder by it in its
                    capacity as Issuing Bank the Bank Guarantee Outstandings net
                    of the amount thereof for which it is counter indemnified by
                    the other Banks under Clause 4.6) to exceed its Commitment.

          2.2.2     Obligations several  The obligations of each Finance Party
                    under this Agreement are several. The failure of a Finance
                    Party to carry out its obligations under this Agreement
                    shall not relieve any other party to this Agreement of its
                    obligations under any Facility Document. No Finance Party
                    shall be responsible for the obligations of any other
                    Finance Party under this Agreement.

                                      -22-
<PAGE>

          2.2.3     Rights several  The Obligations of the Obligors to each of
                    the Finance Parties under each of the Facility Documents are
                    (without prejudice to Clause 1.3) owed to each of them as
                    separate and independent obligations to such Finance Party.
                    Each Finance Party may, except as otherwise stated herein,
                    separately enforce its rights hereunder without joining in
                    any other Finance Party.

3    PURPOSE AND RESPONSIBILITY

     3.1  Purpose  The Facility shall be available for the issuance of Bank
          Guarantees to support performance obligations of the Indemnifiers in
          connection with contractual arrangements entered into or to be entered
          into by such Indemnifiers in respect of Eligible Projects. For the
          avoidance of doubt no Bank Guarantee may be issued in support of any
          financing obligation or Indebtedness.

     3.2  Illegality  The Indemnifiers undertake that no Bank Guarantee will be
          requested if its issuance would in any way be illegal under, or would
          cause the invalidity or unenforceability (in each case in whole or in
          part) of any Facility Document, under any applicable law.

     3.3  Responsibility  Without prejudice to the foregoing and the remaining
          provisions of this Agreement, none of the Finance Parties shall be
          bound to enquire as to the use or application of any Bank Guarantee
          issued hereunder, nor shall any of them be responsible for or for the
          consequences of such use or application.

4    BANK GUARANTEES

     4.1  Delivery of Request  The Obligors' Agent may request that an Issuing
          Bank issue a Bank Guarantee for the benefit of an Indemnifier by
          delivering to the Agent prior to 2.00 p.m. on the seventh Business Day
          (or such earlier date as the Agent may notify the Obligors' Agent from
          time to time) before the proposed Issue Date, a duly completed Issue
          Request, attaching the form of Bank Guarantee to be issued. The Agent
          will deliver such Issue Request to the Issuing Bank specified in the
          Issue Request and/or to one or more other Issuing Banks as the Agent
          deems to be appropriate for the issuance of the Bank Guarantee
          requested therein.

     4.2  Mechanics Upon receipt by an Issuing Bank of the proposed form of Bank
          Guarantee required to be issued together with the Issue Request, such
          Issuing Bank shall decide within five Business Days of receipt of the
          Issue Request whether or not to issue that Bank Guarantee. The Issuing
          Bank shall notify the Agent and the Obligors' Agent within two
          Business Days of its decision not to issue the requested Bank
          Guarantee and of its reasons therefor, and if applicable, of any
          changes in the form of requested Bank Guarantee on the basis of which
          it would determine to issue the requested Bank Guarantee. If no Bank
          Guarantee Termination Date is specified in the Issue Request, the
          Issuing Bank shall request the Agent to seek consent of each Bank
          prior to consenting to issue such Bank Guarantee and in such event the
          Bank Guarantee Termination Date shall be the last day of the 60th
          month from the relevant Issue Date and shall be subject to Clause 9.2.
          For the avoidance of any doubt, the Issuing Bank shall have full
          discretion to refuse to issue any Bank Guarantee in respect of any tax
          or customs bond or contractor licence without any need to specify the
          reasons for such refusal. The relevant Issuing Bank and the other
          Finance Parties

                                      -23-
<PAGE>

          (as applicable) shall not be liable for any loss, cost, claim or
          expense suffered or incurred by any Indemnifier or any other person as
          a consequence of the relevant Issuing Bank not issuing any Bank
          Guarantee so requested. Once a Bank Guarantee has been approved by the
          relevant Issuing Bank the Issue Request in relation to such Bank
          Guarantee shall constitute a warranty by the Obligors' Agent and the
          relevant Indemnifier that the conditions set out in Clause 6.3 will
          have been satisfied on or before the Issue Date requested.

     4.3  Form of Issue Request

          4.3.1     Each Issue Request shall be substantially in the form of
                    Schedule 5, signed by the Obligors' Agent and specify:

                    (a)  the Indemnifier on behalf of which the Bank Guarantee
                         is requested to be issued;

                    (b)  the proposed Issue Date, which shall be a Business Day
                         falling prior to the Facility Availability Termination
                         Date;

                    (c)  the amount of the proposed Bank Guarantee which shall
                         not result in the Bank Guarantee Outstandings (after
                         giving effect to the issuance of all Bank Guarantee for
                         which an Issue Request has been received by the Agent)
                         exceeding at the date such Issue Request is received
                         the Facility Amount (which for the purpose of this
                         Clause 4.3.1(c) shall be reduced by the amount of any
                         other Bank Guarantee in respect of which an Issue
                         Request has therefore been delivered to the Agent but
                         which has not yet been issued at or prior to that
                         proposed Issue Date specified in that Issue Request);

                    (d)  the currency (which shall be a Permitted Currency) of
                         the Bank Guarantee requested;

                    (e)  the requested Issuing Bank; and

                    (f)  in relation to each Bank Guarantee (i) its Bank
                         Guarantee Termination Date (unless none, as may be
                         permitted by Clause 4.2), (ii) the name and address of
                         the beneficiary, (iii) the beneficiary's receiving bank
                         account (if known), (iv) reasonable details of the
                         liabilities payment of which is to be assured by the
                         Bank Guarantee, and (v) the name of the Eligible
                         Project to which such Bank Guarantee relates or, in
                         respect of any tax or customs bond or contractor
                         licence, all relevant details for such bond or licence.

          4.3.2     Each Issue Request shall be irrevocable and the applicable
                    Indemnifier shall be bound to accept the issue of a Bank
                    Guarantee in accordance with such Issue Request. The Agent
                    shall promptly notify each Bank of the Agent's receipt of
                    each Issue Request.

          4.3.3     Together with each Issue Request which relates to any
                    contract with anticipated revenues to the SO Group in excess
                    of $60,000,000, the Obligors' Agent shall deliver an
                    information package containing (i) a

                                      -24-
<PAGE>

                    memorandum from SOSA identifying any material differences
                    between the original tender documentation and the final
                    contract that has been awarded and explaining the reasons
                    for such differences, (ii) a memorandum from SOSA
                    identifying and explaining any material differences between
                    any term in such final contract and the standard terms
                    required by SOSA's risk management system and (iii) a
                    certification by the Executive Officers that they have
                    reviewed the related information package and that they and
                    the board of directors of SOSA have approved such final
                    contract.

          4.3.4     Notwithstanding any other provision of this Agreement, an
                    Indemnifier may request the issue of a Bank Guarantee for
                    the benefit of a joint venture company in which such
                    Indemnifier holds shares or other equity interests upon the
                    unanimous approval of the Banks and the provision of a
                    counter-indemnity from such joint venture company in form
                    and substance satisfactory to the Agent.

     4.4  Issue of Bank Guarantee

          4.4.1     On the terms and subject to the conditions contained in this
                    Agreement, on the proposed Issue Date for any Bank Guarantee
                    the relevant Issuing Bank (as determined by the Agent) will
                    issue, in the form approved by such Issuing Bank after
                    consultation with the Agent, the Bank Guarantee requested by
                    the relevant Issue Request by delivering the same to or to
                    the order of the beneficiary (with a copy to the Agent, the
                    Obligors' Agent and the relevant Indemnifier) or, if
                    requested by the Obligors' Agent, to or to the order of the
                    Obligors' Agent (with a copy to the Agent and the relevant
                    Indemnifier). Upon the issue of each Bank Guarantee the
                    relevant Issuing Bank shall promptly notify the Agent who
                    shall promptly notify each Bank.

          4.4.2     Simultaneously with any reduction of the Commitments in
                    accordance with Clause 5.1 and/or Clause 5.3, the Commitment
                    of each Bank will reduce so that the Commitments of the
                    Banks in respect of the reduced Facility Amount remain in
                    accordance with their respective Proportionate Shares.

     4.5  Counter-Indemnity from the Indemnifier

          4.5.1     Without prejudice to Clause 4.6, the Indemnifiers will
                    indemnify and hold harmless and keep each Finance Party
                    indemnified and held harmless from and against all
                    liabilities, losses, damages, claims, costs, demands and
                    actions (the "Liabilities") which such Finance Party may
                    suffer or incur in connection with each Bank Guarantee
                    issued hereunder and any payment made pursuant to it, except
                    to the extent that any such Liabilities result from such
                    Finance Party's gross negligence, fraud or wilful
                    misconduct. The obligations of the Indemnifiers under this
                    Clause 4.5.1 are joint and several and limited as and to the
                    extent provided in Clause 1.3.

          4.5.2     The Indemnifiers irrevocably direct each Issuing Bank to pay
                    without further confirmation or investigation from or by it
                    any demand appearing to be validly made pursuant to any Bank
                    Guarantee issued by it or on its behalf. Where any Bank
                    Guarantee calls for certificates or other documents, the
                    relevant Issuing Bank may assume, without investigation,

                                      -25-
<PAGE>

                    that the certificates or documents tendered are duly signed
                    by the person by whom they appear to be signed and are (and
                    any matters stated therein are) genuine and correct. Without
                    prejudice to the rights of the relevant Issuing Bank under
                    the Uniform Customs and Practice for Documentary Credits
                    (1993 Revision) (ICC Publication No. 500) (which, to the
                    extent not inconsistent with the express terms of this
                    Agreement and/or any Bank Guarantee, shall apply in relation
                    to all Bank Guarantees), the Indemnifiers agree to reimburse
                    each Finance Party forthwith on written demand of such
                    Finance Party for any amounts paid by such Finance Party
                    (including for avoidance of doubt any amounts paid by an
                    Issuing Bank in respect of any Bank Guarantee) together with
                    interest on such amounts (i) at a rate of 3% per annum above
                    LIBOR, from the date such amounts are paid by such Finance
                    Party until and including two Business Days after such
                    amounts are demanded by such Finance Party from the relevant
                    Indemnifier, and thereafter (ii) at a rate determined in
                    accordance with Clause 10.1 until reimbursement as
                    aforesaid. For the avoidance of doubt, and for the purposes
                    of Clause 10.1, amounts demanded in accordance with this
                    Clause 4.5.2 shall be due on the second Business Day after
                    such demand. The obligations of the Indemnifiers under this
                    Clause 4.5.2 are joint and several and limited as and to the
                    extent provided in Clause 1.3.

          4.5.3     The obligations of the Indemnifiers under this Clause 4.5
                    shall not be impaired by (a) any waiver or time granted to
                    or by any Finance Party, (b) any release or dealings with
                    any rights or security by any Finance Party (including,
                    without limitation, under the Facility Documents), (c) any
                    invalidity of any Bank Guarantee, or (d) any other
                    circumstances which might impair such obligations.

          4.5.4     So long as any amount is or is capable of becoming
                    outstanding by any Obligor to any of the Finance Parties
                    under any of the Facility Documents or any Commitment is in
                    force, the Indemnifiers shall not by virtue of any payment
                    made by it pursuant to this Clause 4.5 or by virtue of any
                    realisation of security made in respect of its obligations
                    under this Clause 4.5, claim or exercise any right of
                    subrogation, contribution or indemnity against any member of
                    the SO Group in competition with any Finance Party.

          4.5.5     Each Issuing Bank will promptly notify the Obligors' Agent
                    of any demand received by it and made (or purporting to be
                    made) pursuant to any Bank Guarantee and of any payment made
                    by it on account of such demand.

     4.6  Banks' Counter-guarantee

          4.6.1     Each Bank as primary obligor guarantees to each Issuing Bank
                    on a full indemnity basis, on demand by each Issuing Bank
                    from time to time, the due performance by the Indemnifiers
                    in relation to each Bank Guarantee issued by such Issuing
                    Bank, of the Obligations of the Indemnifiers to the Issuing
                    Bank under Clause 4.5, provided that the liability of each
                    Bank under this Clause 4.6.1 in relation to any particular
                    default in performance of such obligations by an Indemnifier
                    shall not exceed such Bank's Proportionate Share of the
                    amount in default.

                                      -26-
<PAGE>

          4.6.2     The Issuing Banks shall promptly notify each Bank and the
                    Agent of any demand served on it under any Bank Guarantee
                    issued by it and each payment made pursuant thereto and of
                    any failure by an Indemnifier in performing its obligations
                    under Clause 4.5.

          4.6.3     The provisions set out in Schedule 10 shall apply to the
                    guarantees of each of the Banks in this Clause 4.6 so that
                    such guarantees shall be upon the terms set out in this
                    Clause 4.6 as supplemented by the terms set out in Schedule
                    10. The provisions of Clauses 22.1 and 22.3 shall apply,
                    mutatis mutandis, in relation to payments to be made by each
                    Bank to the Issuing Banks pursuant to this Clause 4.6.

          4.6.4     The Indemnifiers and the Guarantors hereby agree and
                    acknowledge that, to the extent that any Bank makes any
                    payment to any Issuing Bank pursuant to this Clause 4.6,
                    that Bank will thereupon be subrogated to any rights such
                    Issuing Bank may then have against each of the Obligors in
                    respect of the amount so paid by that Bank to such Issuing
                    Bank, and the Indemnifiers will indemnify such Bank in
                    respect of the amount so paid by that Bank. The Indemnifiers
                    shall also indemnify that Bank against all costs and
                    expenses incurred by that Bank in recovering or attempting
                    to recover any amount pursuant to its rights of subrogation
                    referred to above.

     4.7  Issuing Banks' Position Notwithstanding that each Issuing Bank acts as
          principal and not as agent in issuing and agreeing to issue any Bank
          Guarantee under this Agreement, to the extent not inconsistent
          therewith the provisions of Clause 14 excluding or restricting
          liability and responsibility shall apply mutatis mutandis for the
          benefit of each Issuing Bank in its relations with the Banks.

     4.8  Change of Issuing Bank

          4.8.1     The Agent may designate any Bank which consents to act as a
                    replacement or additional Issuing Bank, but not with respect
                    to a Bank Guarantee already issued.

          4.8.2     Any Issuing Bank may resign at any time on giving not less
                    than one month's prior written notice (or in the case of
                    illegality immediately on giving notice) to the Agent and
                    the Indemnifiers if (i) an Instructing Group consents; or
                    (ii) it is unlawful or impracticable for such Issuing Bank
                    to continue as an Issuing Bank; or (iii) it has reasonable
                    grounds for wishing to resign going beyond dissatisfaction
                    with the amount of work involved and/or the fees receivable;
                    or (iv) it ceases to have a Commitment under this Agreement.

          4.8.3     If all the Issuing Banks so resign and no replacement is so
                    appointed, any Bank Guarantee to be issued will be issued by
                    the Agent on behalf of the Banks severally in their
                    Proportionate Shares, and in such an event the Agent will be
                    considered an Issuing Bank and will have all the rights,
                    powers, discretions and remedies of an Issuing Bank under
                    this Agreement.

                                      -27-
<PAGE>

5    REDUCTION

     5.1  Voluntary Reductions The Commitments may be reduced in whole or in
          part but in no event to less than the Bank Guarantee Outstandings in a
          minimum amount of $5,000,000 or, if higher, in integral multiples of
          $500,000, on not fewer than three Business Days' prior written notice
          to the Agent from the Obligors' Agent of such reduction. Any such
          notice shall be irrevocable and each such reduction in the Commitments
          may not be reversed.

     5.2  Facility Amount The Facility Amount shall be reduced from time to time
          by the amount of each Bank Guarantee issued. The Facility Amount shall
          be increased each time during the Facility Availability Period by the
          amount of any issued Bank Guarantee in respect of which there are no
          longer any Bank Guarantee Outstandings.

     5.3  Excess Advances The Agent will value the Bank Guarantee Outstandings
          on a quarterly basis (or at such time when requested to do so by an
          Issuing Bank) and if at such time the aggregate amount of the Bank
          Guarantee Outstandings exceeds the aggregate of the Commitments, the
          Obligors' Agent shall immediately pay or cause to be paid to the Agent
          cash in an amount equal to the difference between the Bank Guarantee
          Outstandings and the aggregate of the Commitments. Such amount shall
          be held by the Agent as additional security for the Obligations. Any
          amount paid to the Agent in accordance with this Clause 5.3 shall be
          aggregated with the amounts paid by the Obligors' Agent in accordance
          with Clause 8 and the provisions of Clause 8 shall apply to such
          amount.

6    CONDITIONS PRECEDENT AND SUBSEQUENT

     6.1  Conditions Precedent - First Bank Guarantee Before any Issuing Bank
          shall have any obligation to issue the first Bank Guarantee under the
          Facility, the Obligors' Agent and the Indemnifiers shall deliver or
          cause to be delivered to, or to the order of, the Agent the following
          documents and evidence:

          6.1.1     Evidence of incorporation Such evidence as the Agent may
                    reasonably require that each Obligor that is a member of the
                    SO Group was duly incorporated in its country of
                    incorporation and remains in existence and, where
                    appropriate, in good standing, with power to enter into, and
                    perform its obligations under, those of the Facility
                    Documents to which it is, or is intended to be, a party,
                    including a copy, certified by a director or an officer of
                    such Obligor as true, complete, accurate and unamended, of
                    all documents establishing or limiting the constitution of
                    such Obligor.

          6.1.2     Corporate authorities A copy, certified by a director or the
                    secretary of each Obligor that is a member of the SO Group
                    as true, complete, accurate and neither amended nor revoked,
                    of a resolution of the directors and (where required by the
                    laws of the country of incorporation or the constitutional
                    documents of the relevant Obligor) a resolution of the
                    shareholders of such Obligor (together, where required by
                    laws of the country of incorporation or its constitutional
                    documents, with signed waivers of notice of any directors'
                    or shareholders' meetings) approving and authorising or
                    ratifying the execution of those of the Facility Documents
                    to which such Obligor is or is intended to be a party and
                    the

                                      -28-
<PAGE>

                    performance of the transactions contemplated thereby and all
                    matters incidental thereto, and in respect of each company
                    incorporated under the laws of Scotland whose shares are
                    being pledged, a resolution of the directors and a
                    resolution of the shareholders of each such company,
                    approving appropriate changes to the articles of association
                    of such company as requested by the Security Trustee, the
                    transfer of the relevant shares to the Security Trustee or
                    its nominee, instructing the updating of statutory registers
                    of such company and approving where appropriate the issue of
                    a further share certificate or certificates.

          6.1.3     Officer's certificate A certificate (i) signed by a duly
                    authorised officer of each of the Obligors that is a member
                    of the SO Group setting out the names of the directors,
                    officers and (except for SOSA) shareholders of that Obligor
                    and (ii) issued by company registry of each Obligor that is
                    a member of the SO Group confirming due incorporation and
                    valid existence and (when such information is maintained by
                    the registry) the names of its directors and shareholders.

          6.1.4     Power of attorney The power of attorney (notarially attested
                    and legalised, if necessary, for registration purposes) of
                    each of the Obligors that is a member of the SO Group under
                    which any Facility Documents are to be executed or
                    transactions undertaken by an attorney on behalf of that
                    Obligor.

          6.1.5     The Facility Documents All of the Facility Documents set
                    forth in Part A of Schedule 4, except for such Share Pledges
                    as the Agent upon request of the Obligors' Agent agrees may
                    be delivered pursuant to Clause 6.2.

          6.1.6     Process agent A letter from Stolt Offshore M.S. Limited
                    accepting its appointment by each of the Obligors as agent
                    for service of Proceedings pursuant to the Facility
                    Documents.

          6.1.7     Legal opinions Confirmation that all legal opinions required
                    by the Agent on behalf of the Banks have been or will be
                    given substantially in the form required by the Agent on
                    behalf of the Banks.

          6.1.8     Accounts The unaudited consolidated accounts of the SO Group
                    for its financial year ended 30 November 2003, certified
                    that they fairly and reasonably represent the financial
                    condition of the SO Group to the best of the knowledge,
                    information and belief of the chief financial officer of
                    SOSA.

          6.1.9     Corporate Structure A current structure chart evidencing the
                    corporate structure of the SO Group, including jurisdiction
                    of organisation, capitalisation and outstanding
                    shareholdings.

          6.1.10    Further Assurance Such other documents and evidence as the
                    Agent may reasonably require in relation to the
                    authorisation, execution, delivery and registration of the
                    Facility Documents and the perfection of the security
                    provided thereby.

                                      -29-
<PAGE>

          6.1.11    Funding of Lock Box One and Lock Box Two Evidence that
                    $20,000,000 has been transferred to Lock Box One and that
                    the balance of excess cash over $75,000,000 has been
                    transferred to Lock Box Two.

          6.1.12    Fees and Expenses Evidence that the fees and invoiced costs
                    and expenses respectively due pursuant to Clauses 12 and
                    24.2 have been paid.

          6.1.13    Risk Management Systems of the SO Group Evidence that SOSA
                    has instructed KPMG to prepare for SOSA and the Finance
                    Parties a report on the recently adopted risk management
                    systems of the SO Group.

          6.1.14    SNSA/SNTG Undertakings Letter SOSA will have requested in
                    writing a letter from SNSA and SNTG on behalf of each
                    shipowning entity that is a Subsidiary of SNSA or SNTG, but
                    not of SOSA confirming that the representations contained in
                    Clauses 7.17, 7.18 and 7.19 are true and correct and
                    undertaking that each such Subsidiary will comply with all
                    covenants and undertakings provided for in Clauses 15.1.1,
                    15.1.2, 15.1.3, 15.2.1 and 15.2.2 and in Schedule 14, as if
                    each such Subsidiary were a party to this Agreement.

          6.1.15    Intercreditor, Override and Security Trust Deed The
                    Intercreditor, Override and Security Trust Deed duly
                    executed and delivered.

          6.1.16    Existing Facilities Guarantee The Existing Facilities
                    Guarantee duly executed and delivered.

          6.1.17    Waiver Fee Evidence that a waiver fee of $10,000 has been
                    paid to each of the financial institution listed in Schedule
                    15, being the banks under the Existing Credit Agreements.

          6.1.18    Approved Budget Delivery of the consolidated budget of the
                    SO Group for the financial year commencing 1 December 2003
                    for the approval by an Instructing Group.

          6.1.19    Items pursuant to Share Pledges Where appropriate, duly
                    executed share certificates, and (where relevant)
                    accompanied by duly stamped and executed stock transfer
                    forms, certified copies of each register of members and any
                    other documents required to be delivered pursuant to the
                    Share Pledges, except where the Agent upon the request of
                    the Obligors' Agent agrees that such may be delivered
                    pursuant to Clause 6.2.

          6.1.20    Appointment of Tom Ehret Evidence that Tom Ehret has been
                    appointed to the board of directors of SOSA by the board of
                    directors of SOSA.

     6.2  Conditions Subsequent SOSA undertakes to deliver or to cause to be
          delivered to the Agent as soon as practicable and in any event no
          later than 31 March 2004, unless a different time period is specified
          below in which event within that time period specified, the following
          additional documents and evidence:

                                      -30-
<PAGE>

          6.2.1     Insurers' letters of undertaking Insurers' letters of
                    undertaking as required by the relevant Facility Documents.

          6.2.2     Legal opinions Such legal opinions as the Agent on behalf of
                    the Banks shall require pursuant to Clause 6.1.7 to the
                    extent not already delivered to the Agent pursuant to that
                    Clause.

          6.2.3     Companies Act registrations On or before 31 March 2004 (or
                    such later date as the Agent may agree after consultation
                    with an Instructing Group in respect of the Facility
                    Documents delivered pursuant to Clause 6.2.8), evidence that
                    the prescribed particulars of the Facility Documents have
                    been delivered to (i) the Registrar of Companies of England
                    and Wales and (ii) any other applicable registry, agency or
                    body within the statutory time limit.

          6.2.4     Master's receipts The Master's receipts for the notices of
                    the Mortgages over the Vessels.

          6.2.5     Independent Directors On or before 31 May 2004, evidence of
                    the appointment to the board of directors of SOSA of two
                    additional non-executive independent directors satisfactory
                    to an Instructing Group.

          6.2.6     Key Staff Retention Package Evidence that the board of
                    directors of SOSA has approved and implemented a key staff
                    retention package to retain Jean-Luc Laloe, Johan Rasmussen,
                    Tom Ehret, Bruno Chabas and Stuart Jackson, in form and
                    substance satisfactory to an Instructing Group.

          6.2.7     Corporate Governance SOSA shall have delivered to the Agent
                    a plan for its governance and the operation of the SO Group
                    independent of SNSA and SNTG and implementation thereof
                    shall have commenced and scheduled to be completed no later
                    than 31 December 2004, which plan shall include
                    establishment on or before 30 September 2004 of a board of
                    directors and audit committee of SOSA that meets the
                    requirements of the National Market System of the National
                    Association of Securities Dealers, Inc. applicable to
                    foreign private issuers that are not "controlled companies"
                    assuming that all phase-in periods for implementing such
                    requirements have expired on 30 September 2004.

          6.2.8     The Remaining Facility Documents On or before 31 March 2004
                    (or such later date as the Agent may agree after
                    consultation with an Instructing Group), the Facility
                    Documents listed in Part B, Part C and Part D of Schedule 4,
                    together with all notices and other documents required by
                    Schedule 9 for all Vessels to become Mortgaged Vessels.

          6.2.9     Items pursuant to Share Pledges To the extent not delivered
                    pursuant to Clause 6.1.19 and where appropriate, all duly
                    executed share certificates, and (where relevant)
                    accompanied by duly stamped and executed stock transfer
                    forms, certified copies of each register of members and any
                    other documents required to be delivered pursuant to the
                    Share Pledges.

                                      -31-
<PAGE>

          6.2.10    Insurance Report The report from the Insurance Adviser in
                    respect of the SO Group's compliance with paragraph 5 of
                    Schedule 14.

          6.2.11    Governmental Approval and Third Party Consents Evidence that
                    (a) the form of Share Pledge in respect of Class 3 Shipping
                    Limited has been pre-approved by the Bermuda Monetary
                    Authority and (b) on or before 31 March 2004 (or such later
                    date as the Agent may agree after consultation with an
                    Instructing Group in respect of the Facility Documents
                    delivered pursuant to Clause 6.2.8), evidence that all other
                    governmental and third party approvals and consents which
                    are necessary for the execution, delivery and performance of
                    the Facility Documents and the consummation of the
                    transactions contemplated thereby, have been obtained.

          6.2.12    Valuations A valuation for each Vessel owned by a member of
                    the SO Group conducted by an Approved Shipbroker appointed
                    by the Obligors' Agent dated no earlier than 31 December
                    2003 addressed to a member of the SO Group.

          6.2.13    SOSA's Extract On or before 22 March 2004, extract from the
                    commercial registrar of companies for SOSA.

          6.2.14    Approval of Tom Ehret's appointment On or before 31 May
                    2004, evidence that Tom Ehret has been elected to the board
                    of directors of SOSA by the shareholders of SOSA or that his
                    appointment to the board of directors of SOSA has been
                    approved by the shareholders of SOSA.

     6.3  Conditions Precedent - All Bank Guarantees Before an Issuing Bank
          shall issue any Bank Guarantee (including the first Bank Guarantee):

          6.3.1     until (i) the Equity Contribution shall have occurred and
                    (ii) the SNSA Guarantee shall have been duly executed and
                    delivered, the Cash Collateral shall not be less than 100%
                    of the Bank Guarantee Outstandings at such time after giving
                    effect to the issuance of all Bank Guarantees for which an
                    Issue Request has been received by the Agent and is no
                    longer pending;

          6.3.2     after (i) the Equity Contribution shall have occurred and
                    (ii) the SNSA Guarantee shall have been duly executed and
                    delivered:

                    (a)  the Value of Qualifying Collateral shall not be less
                         than 100% of the Bank Guarantee Outstandings at such
                         time after giving effect to the issuance of all Bank
                         Guarantees for which an Issue Request has been received
                         by the Agent,

                    (b)  the Cash Collateral shall be not less than 50% of the
                         Bank Guarantee Outstandings at such time after giving
                         effect to the issuance of all Bank Guarantees for which
                         an Issue Request has been received by the Agent; and

                    (c)  the Value of Qualifying Vessel Collateral shall be not
                         less than 120% of the difference between (i) the Bank
                         Guarantee Outstandings at such time after giving effect
                         to the issuance of all

                                      -32-
<PAGE>

                         Bank Guarantees for which an Issue Request has been
                         received by the Agent and (ii) the Cash Collateral at
                         such time.

          6.3.3     no Default shall have occurred and be continuing at the date
                    of the Issue Request or at the Issue Date;

          6.3.4     no Default will result from the issue of the Bank Guarantee
                    in question; and

          6.3.5

                    (a)  in respect of the first Bank Guarantee, all
                         representations and warranties contained in Clause 7;
                         and

                    (b)  in respect of any other Bank Guarantee, all Repeating
                         Representations,

                    shall be true and correct on both the date of the Issue
                    Request and the date that the Bank Guarantee is issued.

     6.4  No waiver If an Instructing Group agrees to the issuance of any Bank
          Guarantee before all of the documents and evidence required by Clause
          6.1 have been delivered to or to the order of the Agent, the Obligors'
          Agent and the relevant Obligor undertake to deliver all outstanding
          documents and evidence to or to the order of the Agent no later than
          the date specified by the Agent, and the issue of any Bank Guarantee
          shall not be taken as a waiver of the Agent's right to require
          production of all the documents and evidence required by Clause 6.1.

     6.5  Form and content All documents and evidence delivered to the Agent
          pursuant to this Clause 6 shall:

          6.5.1     be in form and substance acceptable to the Agent;

          6.5.2     be accompanied, if required by the Agent, by translations
                    into the English language, certified in a manner acceptable
                    to the Agent; and

          6.5.3     if required for registration purposes, be certified,
                    notarised, legalised or attested in a manner acceptable to
                    the Agent.

7    REPRESENTATIONS AND WARRANTIES

Each of the Indemnifiers and each of the Guarantors represents and warrants to
each of the Finance Parties at the date of this Agreement, and in case of the
Repeating Representations (by reference to the facts and circumstances then
pertaining) at the date of each Issue Request and at each Issue Date, as to it
and its Subsidiaries follows:

     7.1  Incorporation and capacity Each of the Obligors is a body corporate
          duly constituted, organised and validly existing and (where
          applicable) in good standing under the law of its country of
          incorporation, in each case with perpetual corporate existence, or in
          respect of SOSA or any Obligor incorporated under the laws of
          Luxembourg, with corporate existence for an unlimited period, and the
          power to sue and be sued, to own its assets and to carry on its
          business.

                                      -33-
<PAGE>

     7.2  Insolvency None of the Obligors (a) is insolvent or in liquidation or
          administration or subject to any other insolvency proceedings, and no
          receiver, administrative receiver, administrator, liquidator, trustee
          or analogous officer has been appointed in respect of any of the
          Obligors or all or any part of their assets, (b) has commenced
          negotiations with any one or more of its creditors with a view to the
          general readjustment or rescheduling of its indebtedness. For this
          purpose a Obligor will be deemed insolvent if it is unable to pay its
          debts within the meaning of section 123 of the Insolvency Act 1986.

     7.3  Binding obligations The Facility Documents when duly executed and
          delivered will constitute the legal, valid and binding obligations of
          the Obligors enforceable in accordance with their respective terms
          subject to applicable laws regarding creditors' rights in general
          subject to reservations expressed in the legal opinions received by
          the Agent in accordance with Clause 6.1.7 or 6.2.2.

     7.4  Satisfaction of conditions Each Obligor has power to enter into,
          perform and deliver and has taken all necessary action to authorise
          its entry into, performance and delivery of the Facility Documents to
          which it is a party and the transactions contemplated therein. All
          acts, conditions and things required to be done and satisfied and to
          have happened prior to the execution and delivery of the Facility
          Documents in order to constitute the Facility Documents as the legal,
          valid and binding obligations of the Obligors in accordance with their
          respective terms and to make the Facility Documents admissible in
          evidence in the appropriate courts have been done, satisfied and have
          happened in compliance with all applicable laws.

     7.5  Registrations and consents With the exception only of the
          registrations referred to in Clause 6.2.3, all (if any) consents,
          licences, approvals and authorisations of, or registrations with or
          declarations to, any governmental authority, bureau or agency which
          may be required in connection with the execution, delivery,
          performance, validity or enforceability of the Facility Documents have
          been obtained or made and remain in full force and effect and neither
          any Indemnifier nor any Guarantor is aware of any event or
          circumstance which could reasonably be expected adversely to affect
          the right of any of the Obligors (as the case may be) to hold and/or
          obtain renewal of any such consents, licences, approvals or
          authorisations.

     7.6  Disclosure of material facts Neither any Indemnifier, nor any
          Guarantor is aware of any material facts or circumstances which have
          not been disclosed to the Agent and which might, if disclosed, have
          reasonably been expected to adversely affect the decision of a person
          considering whether or not to make guarantee facilities of the nature
          contemplated by this Agreement available to the Indemnifiers.

     7.7  No material litigation Except for those matters listed in Schedule 11,
          there is no action, suit, arbitration or administrative proceeding nor
          any contemplated action, suit, arbitration or administrative
          proceeding pending or to its knowledge about to be pursued before any
          court, tribunal or governmental or other authority which would or
          would be reasonably likely to, if adversely determined, have a
          Material Adverse Effect.

     7.8  No breach of law or contract The execution, delivery and performance
          of the Facility Documents will not contravene any contractual
          restriction or any law binding on any of the Obligors or the
          constitutional documents of any of the Obligors, or, in

                                      -34-
<PAGE>

          relation to the Share Pledges, any of the SO Group companies whose
          shares are being pledged, nor result in the creation of, nor oblige
          any of the Obligors to create, any Encumbrance over all or any of its
          assets, with the exception of the Encumbrances created by or pursuant
          to the Facility Documents.

     7.9  No deductions Except as disclosed to the Agent in writing, to the best
          of their knowledge and belief and without undue enquiry, none of the
          Obligors is required to make any deduction or withholding from any
          payment which it may be obliged to make to any of the Finance Parties
          under or pursuant to the Facility Documents.

     7.10 Subsidiaries Save as a result of any merger or amalgamation effected
          pursuant to Clause 15.1.4, the Senior Shipowning Guarantors and the
          relevant Junior Shipowning Guarantors are and will remain throughout
          the Facility Period directly or indirectly wholly owned subsidiaries
          of SOSA.

     7.11 Material adverse change There has been no material adverse change in
          any of the business, condition (financial or otherwise), operations,
          performance, properties or prospects of the SO Group (taken as a
          whole) from that pertaining at 30 November 2003.

     7.12 SOSA's company status SOSA operates as a financial holding company
          under Luxembourg law pursuant to the terms of a letter of the
          "Administration de l'Enregistrement et des Domaines" dated 9 September
          1994.

     7.13 Encumbrances Save for Permitted Liens, no Encumbrance exists over (i)
          all or any of the present or future revenues or assets of any member
          of the SO Group or (ii) any Vessel or its Earnings, Insurances or
          Requisition Compensation nor any part thereof owned by any entity
          which is not a member of the SO Group.

     7.14 Good Title to Assets SOSA and each Subsidiary of SOSA has good, valid
          and marketable title to, or valid leases or licences of, and all
          appropriate authorisations, consents, approvals, registrations,
          filings or similar requirements to use, the assets necessary to carry
          on its business as presently conducted save in so far as any failure
          to have a good, valid and marketable title would not reasonably be
          expected to have a Material Adverse Effect.

     7.15 Taxation

          7.15.1    Each Obligor has duly and punctually paid and discharged or
                    caused to be paid and discharged all Taxes, assessments and
                    governmental charges imposed upon it or its assets within
                    the time period allowed therefor without imposing tax
                    penalties or creating any Encumbrance with priority to the
                    Banks or to the security granted or evidenced by the
                    Facility Documents (save to the extent that such Taxes,
                    assessments and governmental charges are not material or are
                    being contested in good faith and adequate reserves are
                    being maintained for those Taxes and where payment thereof
                    would not result in an Encumbrance with priority to the
                    Banks or to the security created or evidenced by the
                    Facility Documents or would not be likely to have a Material
                    Adverse Effect).

                                      -35-
<PAGE>

          7.15.2    No Obligor is overdue in the filing of any tax returns where
                    failure to file could reasonably be expected to have a
                    Material Adverse Effect.

          7.15.3    No claims are being or, to the best of the knowledge and
                    belief of each Obligor, are reasonably likely to be asserted
                    against any Obligor with respect to Taxes which could
                    reasonably be expected to have a Material Adverse Effect.

          7.15.4    No Obligor has any material unindemnified Tax liabilities
                    which have not been, but should have been, recorded in its
                    statutory accounts.

          7.15.5    Giving effect to all extensions requested and received, the
                    Obligors on a timely basis have properly filed or caused to
                    be filed (and, where applicable, have been included in) all
                    material US Tax returns, reports and statements (whether
                    federal, provincial, state, local or otherwise) applicable
                    to them in all jurisdictions in which such returns, reports
                    and statements are required to be filed (save to the extent
                    that failure to comply with the obligations under this
                    Clause 7.15.5 would not be likely to have a Material Adverse
                    Effect). All such US Tax returns are correct and complete in
                    all material respects.

          7.15.6    Giving effect to all extensions requested and received, the
                    Obligors on a timely basis have paid or caused to be paid
                    all material US Taxes due whether or not shown on any tax
                    return, together with applicable interest and penalties,
                    except to the extent such US Taxes are contested in good
                    faith and with respect to which adequate reserves have been
                    set aside for the payment thereof.

     7.16 Information

          7.16.1    The Information Package (other than forecasts and
                    projections therein) was true, complete and accurate in all
                    material respects as at the date such information was
                    supplied and is not misleading in any material respect and
                    the group structure chart provided in accordance with Clause
                    6.1.9 accurately reflects the shareholdings of the SO Group.

          7.16.2    All forecasts and projections in the Information Package
                    supplied by or on behalf of any Indemnifier or any Guarantor
                    to the Agent, the Banks and/or their advisers were prepared
                    in good faith and based on opinions and assumptions which
                    its respective directors believe were reasonable to hold and
                    reasonable to make at the time of such supply.

          7.16.3    Neither any Indemnifier, nor any Guarantor has failed to
                    disclose to the Agent any facts or circumstances which would
                    be reasonably likely to render any of the information
                    referred to in Clause 7.16.1 or 7.16.2 untrue or misleading
                    in any material respect.

     7.17 The Vessels The Vessels are:

          (a)  in the absolute ownership of the Shipowning Guarantors who will
               on and after the Execution Date be the sole, legal and beneficial
               owner of the Vessels;

                                      -36-
<PAGE>

          (b)  each registered in the name of a Shipowning Guarantor under the
               laws and flag of the countries specified in Schedules 2 and 3;

          (c)  save as disclosed to, and agreed by, the Agent in writing prior
               to the Execution Date, operationally seaworthy and in every way
               fit for service; and

          (d)  except for M.V. Seaway Invincible which is currently not classed,
               DLB1 and M.V. American Independence which are not required to be
               classed in order to operate properly such Vessels, and with
               respect to any of American Star, American Triumph, American
               Victory, American Liberty or American Diver, if demonstrated to
               the satisfaction of the Agent acting reasonably as not requiring
               to be classed in order to properly operate such Vessel, for any
               of such Vessels, classed with the highest applicable class
               necessary to properly operate the Vessels of Lloyd's Register of
               Shipping, Det Norske Veritas, American Bureau of Shipping,
               Isthmus Maritime Classification S.A., Bureau Veritas; free of all
               requirements and overdue recommendations of such classification
               societies.

     7.18 Vessels' employment Save as notified to and approved by the Agent
          before the Execution Date, the Vessels are not and will not on or
          before the Effective Date be subject to any charter or contract or to
          any agreement to enter into any charter or contract which, if entered
          into after the Execution Date would have required the consent of an
          Instructing Group and on or before the Effective Date there will not
          be any agreement or arrangement whereby the Earnings of any of the
          Vessels may be shared with any other person.

     7.19 Environmental matters To the best of the knowledge and belief of the
          Indemnifiers and the Guarantors and their officers:

          (a)  all Environmental Laws applicable to the Vessels have been
               complied with in all material respects and all material consents,
               licences and approvals required under such Environmental Laws
               have been obtained and complied with in all material respects
               other than those which would not reasonably be expected to have a
               Material Adverse Effect; and

          (b)  no Environmental Claim has been made or threatened or is pending
               against any member of the SO Group or any Vessel and not fully
               satisfied which could reasonably be expected to have a Material
               Adverse Effect; and

          (c)  there has been no Environmental Incident which could reasonably
               be expected to have a Material Adverse Effect.

     7.20 No Workers Council There exists no workers council for any Dutch
          Obligor.

8    CURRENCY

     8.1  Currency Fluctuations

          (a)  If as a result of fluctuations in currency exchange rates the
               Agent shall determine that the Bank Guarantee Outstandings exceed
               the Commitments, the Obligors' Agent shall immediately pay or
               cause to be paid to the Agent on

                                      -37-
<PAGE>

               behalf of the Banks an amount in Dollars equal to the amount of
               such difference.

          (b)  If as a result of fluctuations in currency exchange rates the
               Agent shall determine that the Bank Guarantee Outstandings are
               less than 95% of the Commitments, the Agent shall at the request
               of the Obligors' Agent reimburse any amounts paid by the
               Obligors' Agent in accordance with paragraph (a) above.

          (c)  All amounts paid in respect of the Bank Guarantee Outstandings by
               the Obligors' Agent in accordance with paragraph (a) above shall
               be held by the Agent as additional security for the Obligations.

          (d)  The determination by the Agent referred to in Clause 8.1 shall be
               made on a quarterly basis (or at such time when requested to do
               so by an Issuing Bank).

9    FUNDING AND CASH COVER

     9.1  Funding and cash cover The Obligors' Agent undertakes (i) until the
          date on which the Equity Contribution shall have occurred and the SNSA
          Guarantee shall have been duly executed and delivered, (ii) after the
          occurrence and during the continuation of an Event of Default, (iii)
          if the SNSA Guarantee is revoked or repudiated by SNSA or SNTG, or is
          not or ceases to be in full force and effect other than as
          contemplated by the SNSA Guarantee, or (iv) with respect to a
          particular Bank Guarantee after the Bank Guarantee Termination Date of
          such Bank Guarantee if under applicable law the relevant Bank
          Guarantee nevertheless remains outstanding until the subject Bank
          Guarantee instrument is surrendered, to pay or cause the relevant
          Indemnifier to pay to the Agent or to its order (including to deposit
          the same in Lock Box One) on demand the amount specified in that
          demand (in the currency so specified):

          (a)  to give the Agent cash cover for the amount of the Banks'
               Obligations (or in the case of clause (iv) above, those in
               respect of the relevant Bank Guarantee); and/or

          (b)  to put the Agent in funds to make a payment which the Agent
               and/or any Issuing Bank is authorised by this Agreement to make
               in connection with the Banks' Obligations (or in the case of
               clause (iv) above, those in respect of the relevant Bank
               Guarantee),

          provided that any monies received by the Agent pursuant to this Clause
          or Clause 17.1 in excess of the amount of the Banks' Obligations due
          and owing at that time (the "Excess Amount") shall, if not deposited
          in Lock Box One, be held by the Agent by way of retention on account
          of the Obligations and/or applied in accordance with Clause 18.4. In
          the case of clause (ii) above), the Agent may in its sole discretion
          release the Excess Amount to the Obligors' Agent or the Indemnifier
          who provided same if the relevant Event of Default has been remedied
          and no other Default has occurred or is in existence at such time.

     9.2  Collateralising Bank Guarantees The Obligors' Agent shall on demand of
          the Agent made no earlier than 72 months after the Execution Date
          fully Cash

                                      -38-
<PAGE>

          Collateralise or cause the relevant Indemnifiers to fully Cash
          Collateralise all Bank Guarantee Outstandings.

     9.3  Security over funding/cash cover To the extent that cash required by
          Clause 9.1 or under Clause 5.3, 8.1 or 15.2.2 or provided to the Agent
          as additional security to satisfy the condition in Clause 6.3.1 or
          Clause 16.1 is not deposited in Lock Box One and is not required by
          the Facility Documents to be deposited therein, the Obligors' Agent
          undertakes, at its own expense, to execute and cause the Indemnifiers
          to execute (as soon as reasonably practicable) such further documents
          as the Agent may require in order to create, perfect or evidence in
          the Agent's favour a restriction on withdrawal or repayment of any
          amount paid and/or a security interest in or over such amount, in each
          case to secure or support the Obligations.

     9.4  Currency The Agent and/or the relevant Issuing Bank may, if called on
          to make a payment or to comply with a demand or claim in connection
          with the Banks' Obligations, purchase in accordance with its usual
          practice the amount of the Relevant Currency necessary to make that
          payment or to comply with that demand or claim (unless the Agent
          and/or the relevant Issuing Bank has already been put in funds
          pursuant to Clause 9.1).

10   INTEREST

     10.1 Default Rate If an Event of Default in respect of non-payment by any
          Obligor of any amount hereunder shall occur, such amount shall, from
          the date payment to the Agent is due from the relevant Obligor or
          Obligors, bear interest up to the date of actual payment (both before
          and after decree or judgment) at the Default Rate, compounded
          quarterly, which interest shall be payable from time to time by the
          Indemnifiers to the Agent on behalf of the Banks on demand.

     10.2 Determinations conclusive Each determination of an interest rate made
          by the Agent in accordance with Clause 10.1 shall (save in the case of
          manifest error or on any question of law) be final and conclusive.

11   GUARANTEE AND INDEMNITY

     11.1 The Guarantee In consideration of the agreement of the Issuing Banks
          and the Banks to make the Facility available on behalf of the
          Indemnifiers, each Guarantor, subject to Clause 1.3:

          11.1.1    irrevocably and unconditionally guarantees, as primary
                    obligor and not merely as surety, to discharge on demand the
                    Obligations of the Indemnifier which is a Subsidiary of such
                    Guarantor and, to the maximum extent permitted by law, the
                    Obligations of each other Obligor under and in accordance
                    with the terms of the Facility Documents, including payment
                    of Interest thereon from the date of demand until the date
                    of payment, both before and after decree or judgment; and

          11.1.2    agrees, as a separate and independent obligation, that, if
                    any of the Obligations of the Indemnifier or any other
                    Obligor is not recoverable from the other Guarantors under
                    Clause 11.1.1 for any reason, it will be liable to the
                    Finance Parties as a principal debtor by way of indemnity
                    for the same

                                      -39-
<PAGE>

                    amount as that for which it would have been liable had those
                    obligations been recoverable and agrees to discharge its
                    liability under this Clause 11.1.2 on demand together with
                    payment of Interest thereon from the date of demand until
                    the date of payment, both before and after decree or
                    judgement, provided that there shall be no double-counting
                    of Interest occurring in respect to the Obligations under
                    this Clause 11.1.

     11.2 Continuing Security The Guarantee is a continuing security for the
          full amount payable by the Obligors or any of them under the Facility
          Documents from time to time and shall remain in force notwithstanding
          the liquidation of any Obligor or any change in the constitution of
          any Obligor or of any Finance Party or the absorption of or
          amalgamation by any Finance Party in or with any other entity or the
          acquisition of all or any part of the assets or undertaking of any
          Finance Party by any other entity. The Guarantee constitutes a
          guarantee of payment and not of collection.

     11.3 Preservation of Guarantors' Liability

          11.3.1    The Agent may without a Guarantor's consent and without
                    notice to such Guarantor and without in any way releasing or
                    reducing the Obligations of the Guarantors:

                    (a)  amend, novate, supplement or replace all or any of the
                         Facility Documents to which such Guarantor is not a
                         party;

                    (b)  increase or reduce the amount of the Facility or vary
                         the terms and conditions for the issuance of the Bank
                         Guarantees (including, the rate and/or method of
                         calculation of interest or commission payable on the
                         Facility);

                    (c)  allow to the Indemnifiers, any other Obligor or other
                         person any time or other indulgence;

                    (d)  renew, vary, release or refrain from enforcing any of
                         the Facility Documents or any other security, guarantee
                         or indemnity which the Agent may now or in the future
                         hold from the Indemnifiers or from any other person;

                    (e)  compound or make any other arrangements with the
                         Indemnifiers or any other Obligor or other person;

                    (f)  enter into, renew, vary or terminate any other
                         agreement or arrangement with the Indemnifiers or any
                         other Obligor or other person; or

                    (g)  make any concession to the Indemnifiers or other
                         Obligor or do or omit or neglect to do anything which
                         might, but for this provision, operate to discharge,
                         release or reduce the liability of the Guarantors under
                         the Guarantee.

                                      -40-
<PAGE>

          11.3.2    The liability of the Guarantors under the Guarantee shall
                    not be affected by:

                    (a)  the absence of or any defective, excessive or irregular
                         exercise of any of the powers of the Indemnifiers or of
                         any other Obligor;

                    (b)  any security given or payment made to the Finance
                         Parties or any of them by the Indemnifiers or any other
                         person being avoided or reduced under any law (whether
                         English or foreign) relating to bankruptcy or
                         insolvency or analogous circumstance in force from time
                         to time;

                    (c)  the liquidation, administration, receivership or
                         insolvency of any Obligor;

                    (d)  any other security, guarantee or indemnity now or in
                         the future held by the Finance Parties or any of them
                         being defective, void or unenforceable, or the failure
                         of any Finance Party to take any security, guarantee or
                         indemnity;

                    (e)  any compromise or arrangement under Part I of the
                         Insolvency Act 1986 or section 425 of the Companies Act
                         1985 (or any statutory modification or re-enactment of
                         either of them for the time being in force) or under
                         any analogous provision of any foreign law;

                    (f)  the novation of any of the Obligations; or

                    (g)  anything which would not have discharged, released or
                         reduced the liability of any Guarantor to the Finance
                         Parties had the liability of such Guarantor under
                         Clause 11.1.1 been as a principal debtor of the Finance
                         Parties and not as a guarantor.

     11.4 Preservation of Banks' Rights

          11.4.1    The Guarantee is in addition to any other security,
                    guarantee or indemnity now or in the future held by the
                    Finance Parties in respect of the Obligations, whether from
                    any Indemnifier, any Guarantor or any other person, and
                    shall not merge with, prejudice or be prejudiced by any such
                    security, guarantee or indemnity or any contractual or legal
                    right of each Finance Party.

          11.4.2    Any release, settlement, discharge or arrangement relating
                    to the liabilities of any Guarantor under the Guarantee
                    shall be conditional on no payment, assurance or security
                    received by the Finance Parties in respect of the
                    Obligations being avoided or reduced under any law (whether
                    English or foreign) in force from time to time relating to
                    bankruptcy, insolvency or any (in the opinion of the Agent)
                    analogous circumstance and after any such avoidance or
                    reduction the Finance Parties shall be entitled to exercise
                    all of their rights, powers, discretions and remedies under
                    or pursuant to the Guarantee and/or any other rights,
                    powers, discretions or remedies which they would otherwise
                    have been entitled to exercise, as if no release,
                    settlement, discharge or arrangement had taken place. 11.4.3
                    Following the discharge of the Obligations, the Finance
                    Parties shall be entitled to retain any security which they
                    may hold for the liabilities of the Guarantors under the
                    Guarantee until the Finance Parties are satisfied in their
                    reasonable discretion that they will not have to make any
                    payment under any law referred to in Clause 11.4.2.

                                      -41-
<PAGE>

          11.4.3    Following the discharge of the Obligations, the Finance
                    Parties shall be entitled to retain any security which they
                    may hold for the liabilities of the Guarantors under the
                    Guarantee until the Finance Parties are satisfied in their
                    reasonable discretion that they will not have to make any
                    payment under any law referred to in Clause 11.4.2.

          11.4.4    Until all claims of the Finance Parties in respect of the
                    Obligations have been discharged in full and while the Bank
                    Guarantees remain outstanding:

                    (a)  the Guarantors shall not be entitled to participate in
                         any security held or sums received by any Finance Party
                         in respect of all or any part of the Obligations;

                    (b)  the Guarantors shall not stand in the place of, or be
                         subrogated for, any of the Finance Parties in respect
                         of any security nor take any step to enforce any claim
                         against any Indemnifier or any Surety (or the estate or
                         effects of any such person) nor claim or exercise any
                         right of set off or counterclaim against any
                         Indemnifier or any Surety nor make any claim in the
                         bankruptcy or liquidation of any Indemnifier or any
                         Surety in respect of any sums paid by any Guarantor to
                         the Finance Parties or any of them or in respect of any
                         sum which includes the proceeds of realisation of any
                         security at any time held by the Finance Parties or any
                         of them in respect of all or any part of the
                         Obligations of the Guarantors pursuant to the
                         Guarantee; and

                    (c)  the Guarantors shall not take any steps to enforce any
                         claim which it may have against any Indemnifier or any
                         Obligor without the prior written consent of the Agent,
                         and then only on such terms and subject to such
                         conditions as the Agent may impose.

          11.4.5    The Obligations of the Guarantors pursuant to the Guarantee
                    shall be continuing for all purposes (including Interest)
                    and every sum of money which may now or in the future be or
                    become due or owing to the Finance Parties by any Obligor
                    under the Facility Documents (or which would have become due
                    or owing had it not been for the bankruptcy, liquidation or
                    insolvency of the relevant Obligor) shall be deemed to
                    continue due and owing to the Finance Parties by the
                    relevant Obligor until such sum is actually repaid to the
                    Finance Parties, notwithstanding the bankruptcy, liquidation
                    or insolvency of the relevant Obligor.

          11.4.6    The Finance Parties may, but shall not be obliged to, resort
                    for their own benefit to any other means of payment at any
                    time and in any order they think fit without releasing or
                    reducing the Obligations of the Guarantors pursuant to the
                    Guarantee.

          11.4.7    The Finance Parties may enforce the Guarantee either before
                    or after resorting to any other means of payment or
                    enforcement and, in the latter case, without entitling the
                    Guarantors to any benefit from or share in any such other
                    means of payment for so long as all of the Obligations have
                    not been discharged in full.

                                      -42-
<PAGE>

     11.5 Other Security Each Guarantor confirms that it has not taken and will
          not take without the prior written consent of the Agent (and then only
          on such terms and subject to such conditions as the Agent may impose)
          any security from any Indemnifier or from any Surety in connection
          with the Guarantee and that any security taken by any Guarantor in
          connection with the Guarantee notwithstanding this Clause shall be
          held by such Guarantor in trust for the Agent on behalf of the Finance
          Parties absolutely as a continuing security for the Obligations of the
          Guarantors.

     11.6 Release of Guarantee The Agent will (and hereby is authorised by the
          Finance Parties to) execute such documents as may be necessary to
          discharge and release the Guarantee at the end of the Facility Period.

12   FEES

     12.1 Bank Guarantee Commission

          (a)  The Indemnifier for whose benefit each Bank Guarantee has been
               issued shall pay or cause to be paid to the Agent (for the
               account of each Bank) a Bank Guarantee Commission calculated at
               the Applicable Commission Rate on the amount of Bank Guarantee
               Outstandings with respect to each such Bank Guarantee in each
               case for the period during which such Bank Guarantee is
               outstanding.

          (b)  The aggregate Bank Guarantee Commission will accrue from day to
               day on the basis of a 360 day year and the actual number of days
               elapsed and shall be paid quarterly in arrears. The first payment
               shall be due on 31 March 2004 and a final pro rata payment shall
               be due on the last day of the Facility Period. The Bank Guarantee
               Commission with respect to each Bank Guarantee shall be
               distributed according to each Bank's Proportionate Share with
               respect to such Bank Guarantee.

     12.2 Commitment Commission

          (a)  The Obligors' Agent shall pay to the Agent (for the account of
               each Bank) a Commitment Commission calculated from the Execution
               Date until the Facility Availability Termination Date at the
               Applicable Commitment Rate on the daily unutilised portion of the
               Facility available for Bank Guarantees to be issued, assuming and
               whether or not the case that all applicable conditions in Clause
               6 have been satisfied from the Execution Date.

          (b)  The Commitment Commission will accrue from day to day on the
               basis of a 360 day year and the actual number of days elapsed and
               shall be paid quarterly in arrears. The first payment shall be
               due on 31 March 2004 and a final pro rata payment shall be due on
               the Facility Availability Termination Date.

     12.3 Fronting Fee The Indemnifier for whose benefit a Bank Guarantee has
          been issued shall pay or cause to be paid quarterly in arrears to the
          Agent a fronting fee equal to 0.25% per annum of the amount for which
          each Bank Guarantee is issued, for the sole account of the relevant
          Issuing Bank. The first payment shall be due on 31 March 2004 and a
          final pro rata payment shall be due on the last day of the Facility
          Period.

                                      -43-
<PAGE>

     12.4 Issuing Fee The Indemnifier for whose benefit a Bank Guarantee has
          been issued shall pay or cause to be paid on the Issue Date of each
          Bank Guarantee an issue fee of $1,500 in respect of each Bank
          Guarantee payable to the Agent for the account of the Issuing Bank
          that issues such Bank Guarantee.

     12.5 Arrangement, Agency and Security Trustee Fees The Obligors' Agent
          shall pay to the Agent for its own account arrangement, agency and
          security trustee fees and fees to the Security Trustee in the amounts
          and at the times agreed in the letter agreement dated on or about the
          date hereof between the Agent and the Obligors' Agent.

     12.6 Front End Fee The Obligors' Agent shall pay to the Agent within two
          Business Days from the date on which the Intercreditor, Override and
          Security Trust Deed has been executed by each of the parties thereto,
          for the account of the Banks, a front end fee of 1% on the amount of
          the total Commitments, such fee to be payable by the Agent to each
          Bank pro rata to the size of each such Bank's Commitment.

     12.7 Payments in Dollars All fees provided for in this Clause 12 shall be
          payable in Dollars.

     12.8 Invoices to the Obligors' Agent All invoices in respect of the fees
          set forth in this Clause 12 or Clause 24.2 to the Obligors' Agent
          shall be addressed by the Agent to and payable by the Obligors' Agent.

13   FACILITY DOCUMENTS

     13.1 Security As security for the repayment of the Obligations, the
          Indemnifiers and/or the Guarantors shall procure that the Facility
          Documents identified in Schedule 4 and all notices and other documents
          to be given or entered into pursuant thereto as referred to therein
          are executed and delivered to the Agent on or before the Effective
          Date in the agreed form to the extent required by Clauses 6.1 and 6.3
          and in any event for the balance thereof within the time period
          provided in Clause 6.2.

     13.2 Additional Security SOSA shall, and shall procure that each applicable
          member of the SO Group shall:

          13.2.1    if it is a Principal Subsidiary; or

          13.2.2    if it acquires any vessel which would not be immediately and
                    effectively charged by the then existing Facility Documents
                    and which is deemed by an Instructing Group (acting
                    reasonably) to be of material value, or material to the
                    operation of the business of any member of the SO Group or
                    to the value of any other asset over which the Banks have
                    security,

          execute and deliver to the Agent such further or additional Facility
          Documents in such form (but on terms not more onerous than any
          existing Facility Documents) and in relation to such vessels as an
          Instructing Group may reasonably require, subject, in each case, to
          any provisions of law prohibiting such entity from entering into such
          Facility Documents.

                                      -44-
<PAGE>

     13.3 Upon the occurrence of a Default (which has not been remedied) SOSA
          shall procure that any and each Obligor, if so required by an
          Instructing Group, shall execute and deliver to the Agent such further
          or additional Facility Documents in such form and in relation to such
          of its assets as an Instructing Group shall require, subject in each
          case to any provisions of law prohibiting such entity from entering
          into such Facility Documents.

     13.4 Where such prohibition as is referred to above exists, SOSA shall
          procure that the Obligors that are members of the SO Group use their
          reasonable endeavours lawfully to overcome the prohibition, and the
          Agent may (but shall not be obliged to) agree with the relevant member
          of the SO Group limitations on the extent of the security granted by
          it to the extent that in its opinion, based on the advice of
          independent legal counsel acceptable to the Agent (the cost of which
          shall be for the account of SOSA), it is necessary to do so in order
          to overcome the prohibition.

     13.5 SOSA shall procure that each Obligor shall and shall procure that each
          other relevant member of the SO Group which is its Subsidiary shall,
          at such Obligor's own expense execute and do all such assurances, acts
          and things as the Agent may reasonably require for perfecting or
          protecting the security intended to be afforded by the Facility
          Documents or, if the Facility Documents have then become enforceable,
          for facilitating the realisation of all or any part of the assets
          which are subject to the Facility Documents and the exercise of all
          powers, authorities and discretions vested in the Agent or in any
          receiver of all or any part of those assets and in particular shall
          execute all transfers, conveyances, assignments, assignations and
          releases of that property whether to the Agent or to its nominees and
          give all notices, orders and discretions which the Agent may
          reasonably think expedient.

     13.6 On each date that a Facility Document is entered into, the Obligors'
          Agent and SOSA shall procure that certified copies of each of the
          documents listed in Clauses 6.1.1, 6.1.2, 6.1.3 and 6.1.4 and (where
          relevant) duly executed share certificates, duly stamped and executed
          stock transfer forms, certified copies of share registers, title
          documents and any necessary documents relating to assets charged are
          delivered in respect of the member of the SO Group entering into such
          Facility Document in form and substance reasonably satisfactory to the
          Agent and legal opinions addressed to the Agent, the Issuing Banks and
          the Banks from legal advisers acceptable to the Agent in the
          jurisdictions in which the relevant member of the SO Group is
          incorporated and in which the assets charged are situated.

     13.7 Release of Security Upon the request of the Obligors' Agent and the
          relevant Obligor and as long as no Default has occurred and is
          continuing or would result from giving effect to such request
          (provided that such request is not required in the case of Clause
          13.7.4(i)):

          13.7.1    Post Covenant Release Date after the Covenant Release Date
                    the Agent will discharge and release, or will instruct the
                    Security Trustee to discharge and release, all Encumbrances
                    granted in accordance with this Agreement in favour of the
                    Security Trustee;

          13.7.2    Post Facility Availability Termination Date after the
                    Facility Availability Termination Date, upon the request of
                    the Obligors' Agent the Agent will instruct the Security
                    Trustee to discharge and release any

                                      -45-
<PAGE>

                    security represented by the Mortgaged SOSA Vessels to the
                    extent the Value of Qualifying Vessel Collateral exceeds the
                    value requirements set out in Clause 15.4 and the Value of
                    Qualifying Vessel Collateral after giving effect to such
                    discharge and release continues to equal or exceed such
                    requirements;

          13.7.3    In connection with Disclosed Permitted Disposals at any time
                    the Agent will discharge and release, or will instruct the
                    Security Trustee to discharge and release, any Encumbrance
                    in connection with the Mortgaged SOSA Vessels to allow the
                    Disclosed Permitted Disposal of such Mortgaged SOSA Vessel
                    against deposit of the Net Disposal Proceeds, if any, in
                    Lock Box One, as required by Clause 15.2.18; and

          13.7.4    In connection with the SNSA Guarantee and the SNTG Vessels
                    after SOSA has achieved a Consolidated Tangible Net Worth of
                    at least $300,000,000 as reflected in financial statements
                    for two consecutive fiscal quarters that are included in
                    filings or submissions on Forms 6-K with the United States
                    Securities and Exchange Commission and any interim monthly
                    financial statements covering the two months ending between
                    the quarterly balance sheet dates provided to the Agent
                    pursuant to this Agreement (i) the Obligations of SNSA and
                    SNTG under the SNSA Guarantee shall (provided no Default is
                    outstanding) be automatically released without further
                    documentation or action and (ii) the Agent will discharge
                    and release all Encumbrances granted by SNTG or any of its
                    Subsidiaries in connection with the Mortgaged Vessels to
                    secure the Obligations.

          The Obligors' Agent and the relevant Obligors shall be responsible for
          all costs in connection with any discharge and release of Encumbrances
          pursuant to this Clause 13.7. The Agent will execute and do, or will
          instruct the Security Trustee to execute and do, all such deeds, acts
          and things as may be necessary to discharge and release the Mortgaged
          Vessels from the Encumbrances constituted by the relevant Facility
          Documents and in accordance with the relevant provisions (if any) of
          such Facility Documents.

14   AGENCY AND TRUST

     14.1 Appointment Each of the Finance Parties irrevocably appoints the Agent
          as its agent for the purpose of administering the Facility and the
          Facility Documents and authorises the Agent and its directors,
          officers, employees and agents on such Bank's behalf acting on the
          instructions from time to time of an Instructing Group and subject to
          Clauses 14.4 and 14.20, to execute the Facility Documents and to
          exercise all rights, powers, discretions and remedies vested in the
          Finance Parties under or pursuant to the Facility Documents, together
          with all powers reasonably incidental to them.

     14.2 Authority Subject to Clause 14.4, each of the Banks irrevocably
          authorises the Agent, acting on the instructions from time to time of
          an Instructing Group:

          14.2.1    to give or withhold any waivers, consents or approvals,

                                      -46-
<PAGE>

          14.2.2    to amend or vary the terms,

          14.2.3    to exercise, or refrain from exercising, any discretions,
                    and

          14.2.4    to collect, receive, release or pay any money

          of, under or pursuant to any of the Facility Documents. The Agent
          shall have no duties or responsibilities as agent or as security
          trustee other than those expressly conferred on it by the Facility
          Documents and shall not be obliged to act on any instructions if to do
          so would, in the opinion of the Agent, be contrary to any provision of
          the Facility Documents or to any law, or would expose the Agent to any
          actual or potential liability to any third party.

     14.3 Trust The Agent agrees and declares, and each of the Banks
          acknowledges, that, subject to the terms and conditions of this Clause
          14.3, the Agent holds the Trust Property on trust for the Banks, in
          accordance with their respective Proportionate Shares, and for the
          other Finance Parties absolutely. Each of the Finance Parties agrees
          that the obligations, rights and benefits vested in the Agent in its
          capacity as security trustee shall be performed and exercised in
          accordance with this Clause 14.3. The Agent in its capacity a security
          trustee shall have the benefit of all of the provisions of this
          Agreement benefiting the Agent in its capacity as agent for the
          Finance Parties, and all the powers and discretions conferred on
          trustees by the Trustee Act 1925 (to the extent not inconsistent with
          this Agreement). In addition:

          14.3.1    the Agent (and any attorney, agent or delegate of the Agent)
                    may indemnify itself or himself out of the Trust Property
                    against all liabilities, costs, fees, damages, charges,
                    losses and expenses sustained or incurred by it or him in
                    relation to the taking or holding of any of the Trust
                    Property or in connection with the exercise or purported
                    exercise of the rights, trusts, powers and discretions
                    vested in the Agent or any other such person by or pursuant
                    to the Facility Documents or in respect of anything else
                    done or omitted to be done in any way relating to the
                    Facility Documents; and

          14.3.2    the Finance Parties acknowledge that the Agent shall be
                    under no obligation to insure any property nor to require
                    any other person to insure any property and shall not be
                    responsible for any loss which may be suffered by any person
                    as a result of the lack or insufficiency of any insurance;
                    and

          14.3.3    the Agent and the Finance Parties agree that the perpetuity
                    period applicable to the trusts declared by this Agreement
                    shall be the period of 80 years from the Execution Date.

     14.4 Limitations on authority Except with the prior written consent of each
          of the Banks, the Agent shall not be entitled to:

          14.4.1    release any material amount of security given for payment of
                    the Obligations, except as expressly provided for in the
                    Facility Documents;

          14.4.2    except as otherwise provided in the Facility Documents,
                    agree to waive the payment of any sum of money payable by
                    any of the Obligors under the Facility Documents;

                                      -47-
<PAGE>

          14.4.3    change the meaning of the expression "Instructing Group";

          14.4.4    exercise, or refrain from exercising, any discretion, or
                    give or withhold any consent, the exercise or giving of
                    which is, by the terms of this Agreement, expressly reserved
                    to the Banks;

          14.4.5    extend the due date for the payment of any sum of money
                    payable by any of the Obligors under the Facility Documents;

          14.4.6    take or refrain from taking any action if the effect of such
                    action or inaction may increase the Commitments of the Banks
                    or subject the Banks to any additional obligations under any
                    of the Facility Documents, other than as contemplated by
                    such Facility Documents;

          14.4.7    agree to change the currency in which any sum is payable
                    under the Facility Documents (other than in accordance with
                    the terms of the Facility Documents);

          14.4.8    agree to amend this Clause 14.4;

          14.4.9    agree to amend Clause 12.1, 12.2 or 16.1; or

          14.4.10   change the meaning of the expression "Equity Contribution".

     14.5 Issuing Banks' Consent Except with the prior written consent of each
          of the Issuing Banks, the Agent shall not be entitled to take or
          refrain from taking any action if the effect of such action or
          inaction may subject an Issuing Bank to any additional obligations
          under any of the Facility Documents, other than as contemplated by
          such Facility Documents.

     14.6 Liability Neither the Agent nor any of its directors, officers,
          employees or agents shall be liable to the Finance Parties for
          anything done or omitted to be done by the Agent under or in
          connection with the Facility Documents unless as a result of the
          Agent's wilful misconduct or gross negligence.

     14.7 Acknowledgement Each of the Finance Parties acknowledges that:

          14.7.1    it has not relied on any representation made by the Agent or
                    any of the Agent's directors, officers, employees or agents
                    or by any other person acting or purporting to act on behalf
                    of the Agent to induce it to enter into any of the Facility
                    Documents;

          14.7.2    it has made and will continue to make without reliance on
                    the Agent, and based on such documents and other evidence as
                    it considers appropriate, its own independent investigation
                    of the financial condition and affairs of the Obligors in
                    connection with the making and continuation of the Facility;

          14.7.3    it has made its own appraisal of the creditworthiness of the
                    Obligors; and

          14.7.4    the Agent shall not have any duty or responsibility at any
                    time to provide it with any credit or other information
                    relating to any of the Obligors unless

                                      -48-
<PAGE>

                    that information is received by the Agent pursuant to the
                    express terms of the Facility Documents.

          Each of the Finance Parties agrees that it will not assert nor seek to
          assert against any director, officer, employee or agent of the Agent
          or against any other person acting on behalf of the Agent any claim
          which it might have against them in respect of any of the matters
          referred to in this Clause 14.7.

          Notwithstanding anything to the contrary contained in this Agreement,
          the Arranger is a Bank designated as "Arranger" for title purposes
          only and in such capacity shall have no obligations or duties
          whatsoever under this Agreement or any other Facility Document to any
          Finance Party and shall have no rights separate from its rights as a
          Bank except as expressly provided in this Agreement.

     14.8 Limitations on responsibility The Agent shall have no responsibility
          to any of the Obligors or the Finance Parties on account of:

          14.8.1    the failure of a Finance Party or of any of the Obligors to
                    perform any of its respective obligations under the Facility
                    Documents;

          14.8.2    the financial condition of any of the Obligors;

          14.8.3    the completeness or accuracy of any statements,
                    representations or warranties made in or pursuant to any of
                    the Facility Documents, or in or pursuant to any document
                    delivered pursuant to or in connection with any of the
                    Facility Documents;

          14.8.4    the negotiation, execution, effectiveness, genuineness,
                    validity, enforceability, admissibility in evidence or
                    sufficiency of any of the Facility Documents or of any
                    document executed or delivered pursuant to or in connection
                    with any of the Facility Documents.

     14.9 The Agent's rights The Agent may:

          14.9.1    assume that all representations or warranties made or deemed
                    repeated by any of the Obligors in or pursuant to any of the
                    Facility Documents are true and complete, unless, in its
                    capacity as the Agent, it has acquired actual knowledge to
                    the contrary; and

          14.9.2    assume that no Default has occurred unless, in its capacity
                    as the Agent, it has acquired actual knowledge to the
                    contrary; and

          14.9.3    rely on any document or Communication believed by it to be
                    genuine; and

          14.9.4    rely as to legal or other professional matters on opinions
                    and statements of any legal or other professional advisers
                    selected or approved by it; and

          14.9.5    rely as to any factual matters which might reasonably be
                    expected to be within the knowledge of any of the Obligors
                    on a certificate signed by or on behalf of that Obligor; and

                                      -49-
<PAGE>

          14.9.6    refrain from exercising any right, power, discretion or
                    remedy unless and until instructed to exercise that right,
                    power, discretion or remedy and as to the manner of its
                    exercise by the Banks (or, where applicable, by an
                    Instructing Group) and unless and until the Agent has
                    received from the Banks any payment which the Agent may
                    require on account of, or any security which the Agent may
                    require for, any costs, claims, expenses (including legal
                    and other professional fees) and liabilities which it
                    considers it may incur or sustain in complying with those
                    instructions.

    14.10 The Agent's duties The Agent shall:

          14.10.1   if requested in writing to do so by a Bank or Issuing Bank,
                    make enquiry and advise the Banks or Issuing Banks, as the
                    case may be, as to the performance or observance of any of
                    the provisions of the Facility Documents by any of the
                    Obligors or as to the existence of an Event of Default; and

          14.10.2   promptly notify the Banks of the occurrence of any Default
                    of which the Agent has actual knowledge;

          14.10.3   promptly notify the Banks of the contents of any notice,
                    request or document received by it in its capacity as Agent
                    from any Obligor pursuant to any Facility Document; and

          14.10.4   advise the Banks on monthly basis with respect to the Bank
                    Guarantee Outstandings and the Cash Collateral.

    14.11 No deemed knowledge The Agent shall not be deemed to have actual
          knowledge of the falsehood or incompleteness of any representation or
          warranty made or deemed repeated by any of the Obligors or actual
          knowledge of the occurrence of any Default unless a Bank or any of the
          Obligors shall have given written notice thereof to the Agent.

    14.12 Other business The Agent may, without any liability to account to the
          Banks, generally engage in any kind of banking or trust business with
          any of the Obligors or any of their respective Subsidiaries or
          associated companies or with a Bank as if it were not the Agent.

    14.13 Indemnity The Banks shall, promptly on the Agent's request, reimburse
          the Agent in their respective Proportionate Shares, for, and keep the
          Agent fully indemnified in respect of all liabilities, damages, costs
          and claims sustained or incurred by the Agent in connection with the
          Facility Documents, or the performance of its duties and obligations,
          or the exercise of its rights, powers, discretions or remedies under
          or pursuant to any of the Facility Documents; or in connection with
          any action taken or omitted by the Agent under or pursuant to any of
          the Facility Documents, unless in any case those liabilities, damages,
          costs or claims arise solely from the Agent's wilful misconduct or
          gross negligence.

    14.14 Employment of agents In performing its duties and exercising its
          rights, powers, discretions and remedies under or pursuant to the
          Facility Documents, the Agent shall be entitled to employ and pay
          agents to do anything which the Agent is empowered to

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<PAGE>

          do under or pursuant to the Facility Documents (including the receipt
          of money and documents and the payment of money) and to act or refrain
          from taking action in reliance on the opinion of, or advice or
          information obtained from, any lawyer, banker, broker, accountant,
          valuer or any other person believed by the Agent in good faith to be
          competent to give such opinion, advice or information.

    14.15 Distribution of payments The Agent shall pay promptly to the order of
          each of the Banks that Bank's Proportionate Share (or to the Issuing
          Banks the amounts to which they are entitled) of every sum of money
          received by the Agent pursuant to the Facility Documents or the
          Mortgagees' Insurances (with the exception of any amounts which, by
          the terms of the Facility Documents, are paid to the Agent for
          retention on account of the Obligations or for the account of the
          Agent alone or specifically for the account of one or more Banks or
          Issuing Banks) and until so paid such amount shall be held by the
          Agent on trust absolutely for that Bank (or that Issuing Bank).

    14.16 Reimbursement The Agent shall have no liability to pay any sum to a
          Bank (or an Issuing Bank) until it has itself received payment of that
          sum. If, however, the Agent does pay any sum to a Bank (or an Issuing
          Bank) on account of any amount prospectively due to it pursuant to
          Clause 14.15 before it has itself received payment of that amount, and
          the Agent does not in fact receive payment within five Business Days
          after the date on which that payment was required to be made by the
          terms of the Facility Documents or the Mortgagees' Insurances, the
          recipient will, on demand by the Agent, refund to the Agent an amount
          equal to the amount received by it, together with an amount sufficient
          to reimburse the Agent for any amount which the Agent may certify that
          it has been required to pay by way of interest on money borrowed to
          fund the amount in question during the period beginning on the date on
          which that amount was required to be paid by the terms of the Facility
          Documents or the Mortgagees' Insurances and ending on the date on
          which the Agent receives reimbursement.

    14.17 Redistribution of payments Unless otherwise agreed between the
          Finance Parties, if at any time a Bank receives or recovers by way of
          set-off, the exercise of any Encumbrance or otherwise (other than from
          any assignee or transferee of or sub-participant in that Bank's
          Commitment or credit insurer of or issuer of a credit derivative in
          respect thereof), an amount greater than that Bank's Proportionate
          Share of any sum due from any of the Obligors under the Facility
          Documents (the amount of the excess being referred to in this Clause
          as the "Bank's Excess Amount") then:

          14.17.1   that Bank shall promptly notify the Agent (which shall
                    promptly notify each other Bank);

          14.17.2   that Bank shall pay to the Agent an amount equal to the
                    Bank's Excess Amount within 10 days of its receipt or
                    recovery of the Bank's Excess Amount; and

          14.17.3   the Agent shall treat that payment as if it were a payment
                    by the Obligor in question on account of the sum owed to the
                    Banks as aforesaid and shall account to the Banks in respect
                    of the Bank's Excess Amount in accordance with the
                    provisions of this Clause.

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<PAGE>

          However, if a Bank has commenced any Proceedings to recover sums owing
          to it under the Facility Documents and, as a result of, or in
          connection with, those Proceedings has received a Bank's Excess
          Amount, the Agent shall not distribute any of that Bank's Excess
          Amount to any other Bank which had been notified of the Proceedings
          and had the legal right to, but did not, join those Proceedings or
          commence and diligently prosecute separate Proceedings to enforce its
          rights in the same or another court.

     14.18 Rescission of Bank's Excess Amount If all or any part of any Bank's
          Excess Amount is rescinded or must otherwise be restored to any of the
          Obligors or to any other third party, the Banks which have received
          any part of that Bank's Excess Amount by way of distribution from the
          Agent pursuant to this Clause shall repay to the Agent for the account
          of the Bank which originally received or recovered the Bank's Excess
          Amount, the amount which shall be necessary to ensure that the Banks
          share rateably in accordance with their Proportionate Shares in the
          amount of the receipt or payment retained, together with interest on
          that amount at a rate equivalent to that (if any) paid by the Bank
          receiving or recovering the Bank's Excess Amount to the person to whom
          that Bank is liable to make payment in respect of such amount, and
          Clause 14.17.3 shall apply only to the retained amount.

    14.19 Proceedings Each of the Finance Parties shall notify one another of
          the proposed commencement of any Proceedings under any of the Facility
          Documents prior to their commencement. No such Proceedings may be
          commenced without the prior written consent of an Instructing Group.

    14.20 Instructions Where the Agent is authorised or directed to act or
          refrain from acting in accordance with the instructions of the Banks
          or of an Instructing Group each of the Banks shall provide the Agent
          with instructions within five Business Days of the Agent's request
          (which request shall be made in writing). If a Bank does not provide
          the Agent with instructions in writing within that period, (i) that
          Bank shall be bound by the decision of the Agent, (ii) that Bank shall
          have no vote for the purposes of this Clause 14 and (iii) the combined
          Proportionate Shares of the other Banks who provided such instructions
          shall be deemed to contribute 100%. Nothing in this Clause 14 shall
          limit the right of the Agent to take, or refrain from taking, any
          action without obtaining the instructions of the Banks if the Agent in
          its discretion considers it necessary or appropriate to take, or
          refrain from taking, such action in order to preserve the rights of
          the Banks under or in connection with the Facility Documents. In that
          event, the Agent will notify the Banks of the action taken by it as
          soon as reasonably practicable, and the Banks agree to ratify any
          action taken by the Agent pursuant to this Clause 14.

    14.21 Communications Any Communication under this Clause 14 shall be given,
          delivered, made or served, in the case of the Agent (in its capacity
          as Agent or as one of the Finance Parties), and in the case of the
          other Finance Parties, at the address indicated in Part B of Schedule
          1 or such other address as shall be duly notified in writing to the
          Agent on behalf of a Bank. Any Communication to the Agent shall be
          effective only when received by the Agent.

    14.22 Payments All amounts payable to a Finance Party under this Clause 14
          shall be paid to such account at such bank as that Finance Party may
          from time to time direct in writing to the Agent.

                                      -52-
<PAGE>

    14.23 Retirement Subject to a successor being appointed in accordance with
          this Clause 14, the Agent may retire as agent and/or security trustee
          at any time without assigning any reason by giving to the Obligors'
          Agent and the other Finance Parties notice of its intention to do so,
          in which event the following shall apply:

          14.23.1   with the consent of the Obligors' Agent, not to be
                    unreasonably withheld except that no such consent shall be
                    required during an Event of Default, the other Finance
                    Parties may within 30 days after the date of the Agent's
                    notice appoint a successor to act as agent and/or security
                    trustee or, if they fail to do so with the consent of the
                    Obligors' Agent, not to be unreasonably withheld except that
                    no such consent shall be required during an Event of
                    Default, the Agent may appoint any other bank or financial
                    institution as its successor;

          14.23.2   the resignation of the Agent shall take effect
                    simultaneously with the appointment of its successor on
                    written notice of that appointment being given to the
                    Indemnifiers and the other Finance Parties;

          14.23.3   the Agent shall thereupon be discharged from all further
                    obligations as agent and/or security trustee but shall
                    remain entitled to the benefit of the provisions of this
                    Clause 14;

          14.23.4   the Agent's successor and each of the other parties to this
                    Agreement shall have the same rights and obligations amongst
                    themselves as they would have had if that successor had been
                    a party to this Agreement.

    14.24 No fiduciary relationship Except as provided in Clauses 14.3 and
          14.15, the Agent shall not have any fiduciary relationship with or be
          deemed to be a trustee of or for a Bank and nothing contained in any
          of the Facility Documents shall constitute a partnership between any
          two or more Banks or between the Agent and any Bank.

    14.25 The Agent as a Bank and an Issuing Bank The expression "the Banks" or
          "the Issuing Banks" when used in the Facility Documents includes the
          Agent in its capacity as one of the Banks or the Issuing Banks, as the
          case may be. The Agent shall be entitled to exercise its rights,
          powers, discretions and remedies under or pursuant to the Facility
          Documents in its capacity as one of the Banks or the Issuing Banks in
          the same manner as any other Bank or Issuing Bank and as if it were
          not also the Agent.

    14.26 The Agent as security trustee Unless the context otherwise requires,
          the expression "the Agent" when used in the Facility Documents
          includes the Agent acting in its capacity as agent or as security
          trustee.

15   COVENANTS

     15.1 Negative covenants SOSA, each of the Indemnifiers and each of the
          other Guarantors covenants with and undertakes to the Finance Parties
          that it shall not, and shall ensure that no other Obligor or other
          member of the SO Group that is its Subsidiary shall, without the prior
          written consent of an Instructing Group:

          15.1.1    Encumbrances create or permit to arise or continue any
                    Encumbrance on or over all or any part of its assets
                    (including accounts receivable) or undertakings except
                    Permitted Liens; or

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<PAGE>

          15.1.2    chartering (a) charter any Vessel or permit any Vessel to be
                    chartered on any bareboat charter, or otherwise for a period
                    exceeding (or inclusive of any extension options, capable of
                    exceeding) 12 months provided that committing a Vessel for
                    several periods, each of 12 months or less but for an
                    aggregated period exceeding 12 months shall not be deemed to
                    be a breach of this Clause, (b) charter any Vessel or permit
                    any Vessel to be chartered on any bareboat charter or
                    otherwise to a member of the SO Group for any period unless
                    the relevant charterer has executed a charterer's
                    subordination undertaking in the agreed form in favour of
                    the Security Trustee or the Agent, as the case may be or (c)
                    following the occurrence and during the continuation of an
                    Event of Default, let any Vessel on charter (including a
                    charter otherwise permitted by this Clause 15.1.2 unless the
                    same was entered into prior to the occurrence of any such
                    Event of Default) or renew or extend any charter or other
                    contract of employment of any such Vessel (nor agree to do
                    so); or

          15.1.3    no change in Vessel management permit the appointment of
                    anyone other than the Managers as commercial or technical
                    managers of the Vessels, nor terminate or amend any
                    Management Agreement and/or the arrangements for the
                    commercial or technical management of the Vessels in a
                    manner which is, in the reasonable opinion of the Agent,
                    detrimental to the interest of the Finance Parties or any of
                    them, nor permit the Managers to sub-contract or delegate
                    the commercial or technical management of any Vessel to any
                    third party outside of the SO Group provided that any
                    termination or amendment of any Management Agreement and/or
                    management arrangements referred to above with a member of
                    the SO Group shall not be deemed to be detrimental to the
                    interests of the Finance Parties or any of them where any
                    new manager (being within the SO Group) enters into an
                    agreement with the Agent or the Security Trustee, as the
                    case may be, subordinating its rights in such Vessel to
                    those of the Finance Parties in terms substantially the same
                    as contained in those agreements/arrangements entered into
                    immediately before such amendment and procure that any
                    Manager which is at any time a member of the SO Group enters
                    into such an agreement with the Security Trustee or the
                    Agent; or

          15.1.4    merger or amalgamation permit any merger or amalgamation
                    unless (i) a Guarantor, an Indemnifier or a Shipowning
                    Guarantor remains the surviving entity following any such
                    merger or amalgamation (or if the merger or amalgamation
                    involves more than one of the Guarantors, the Indemnifiers
                    or the Shipowning Guarantors, then one of such Guarantors,
                    such Indemnifiers or such Shipowning Guarantors remains the
                    surviving entity) and (ii) such surviving entity is a member
                    of the SO Group and an Obligor and (iii) in the case of SOSA
                    only, such merger or amalgamation has been approved by a
                    duly passed resolution of SOSA's shareholders and (iv) no
                    Default is then continuing or would result therefrom; or

                                      -54-
<PAGE>

          15.1.5    capital expenditure permit the aggregate Capital
                    Expenditures of the SO Group in respect of any financial
                    year of SOSA to exceed the maximum expenditure provided
                    therefor in the Approved Budget for that financial year; or

          15.1.6    other permitted expenditures make any other expenditure in
                    excess of $2,000,000 not contemplated by the Approved Budget
                    for that financial year; or

          15.1.7    acquisitions other than in the ordinary course of business
                    and in accordance with past practice and the Approved
                    Budget, permit any member of the SO Group to (i) purchase,
                    subscribe for or otherwise acquire any shares (or other
                    securities or any interest therein) in, or incorporate, any
                    other company or agree to do any of the foregoing; or (ii)
                    purchase or otherwise acquire any business or any assets
                    which, when taken together, constitute a business; or

          15.1.8    dividends and distributions pay, make or declare any
                    dividend, return on capital, repayment of capital
                    contributions or other distribution (whether in cash) or
                    make any distribution of assets or other payment whatsoever
                    in respect of share capital and shareholder loans at any
                    time, other than any such payments to any member of the SO
                    Group; or

          15.1.9    restrictions on prepayments pay, prepay or repay or defease,
                    exchange or repurchase or otherwise satisfy prior to the
                    scheduled maturity thereof or make a payment in violation of
                    any subordination terms of any Permitted Indebtedness
                    (provided however that the provisions of this Clause 15.1.9
                    shall not apply to the Existing Credits to the extent
                    provided in the Intercreditor, Override and Security Trust
                    Deed) or (without prejudice to Clause 1.3.5) prepay any
                    intercompany Indebtedness owed by the Obligors' Agent to
                    SOSA or SO BV if as a result of any such prepayment the
                    amount outstanding thereunder is less than 125% of the
                    Commitments; or

          15.1.10   loans and guarantees make any loans, grant any credit or
                    other financial accommodation or give any guarantee (except
                    as required by the Facility Documents) to or for the benefit
                    of any person or otherwise voluntarily assume any liability,
                    whether actual or contingent, in respect of any obligation
                    of any other person except:

                    (a)  any loans and indemnities in respect of guarantees
                         existing at the Execution Date and disclosed in
                         Schedule 21;

                    (b)  credit granted in the ordinary course of trade;

                    (c)  indemnities or guarantees given by one member of the SO
                         Group in respect of Indebtedness or other obligations
                         of another member of the SO Group or by a member of the
                         SO Group in respect of Indebtedness or other
                         obligations of a joint venture company of a member of
                         the SO Group, in each case permitted to be incurred
                         hereunder, provided that each such indemnity or
                         guarantee is

                                      -55-
<PAGE>

                         unsecured, given in the ordinary course of trading and
                         upon terms usual for such trade;

                    (d)  loans made by one member of the SO Group to another
                         member of the SO Group in connection with ordinary
                         day-to-day cash management arrangements;

                    (e)  loans made by a member of the SO Group to a joint
                         venture company of a member of the SO Group provided in
                         the ordinary course of business and in accordance with
                         past practice and the Approved Budget; and

                    (f)  loans from any member of the SO Group to SOSA for the
                         sole purpose of financing SOSA's normal operating cash
                         flow needs; or

          15.1.11   disposals

                    sell, lease, transfer or otherwise dispose of, by one or
                    more transactions or series of transactions (whether related
                    or not), the whole or any part of its revenues or its assets
                    (including any Vessel) or its business or undertakings
                    (including any Shipowning Guarantor) other than:

                    (a)  Disclosed Permitted Disposals;

                    (b)  disposals of inventory made in the ordinary and usual
                         course of business on arm's length commercial terms;

                    (c)  disposals of cash in the ordinary course of business;

                    (d)  disposals of obsolete assets not required for the
                         operation of the businesses of the SO Group;

                    (e)  disposals of Vessels by one member of the SO Group to
                         another member of the SO Group provided that the sale
                         or disposal, in whole or in part, is made to a member
                         of the SO Group who is or will become a Shipowning
                         Guarantor upon the acquisition of such Vessel and who
                         will execute and deliver to the Agent a Shipowners'
                         Guarantee, a Mortgage and an Assignment in respect of
                         such Vessel in substantially the same terms as those
                         Facility Documents already executed in favour of the
                         Security Trustee and delivered to the Agent which shall
                         be accompanied by such corporate documents and legal
                         opinions as the Agent may request (and upon any sale or
                         disposal of a Shipowning Guarantor or its Vessel such
                         Shipowning Guarantor's obligations under the Facility
                         Documents to which it is a party will (unless such
                         Shipowning Guarantor will continue to own any of the
                         Vessels following such sale or disposal of a Vessel)
                         terminate provided that no Event of Default is
                         continuing or would result therefrom and the provisions
                         of this Clause 15.1.11 have been fully complied with);
                         or

                                      -56-
<PAGE>

                    (f)  disposals of any Vessel where such Vessel is replaced
                         by a similar asset acceptable to an Instructing Group
                         of equal or greater value; or

                    (g)  disposals where the higher of the market value or
                         consideration receivable which (when aggregated with
                         the higher of the market value or consideration
                         receivable for any other disposal effected since the
                         date of this Agreement, other than any permitted under
                         paragraphs (a) to (f) above) does not exceed in any
                         financial year $10,000,000 or its equivalent in another
                         currency or currencies; or

          15.1.12   amendments amend, vary, modify or supplement any provision
                    of the constitutional documents of any member of the SO
                    Group, except to the extent that a Material Adverse Effect
                    would not reasonably be expected to result therefrom and the
                    rights and interests of the Finance Parties pursuant to the
                    Facility Documents would not be materially adversely
                    affected thereby; or

          15.1.13   share capital redemption redeem, repurchase, defease,
                    retire, dispose of, return, repay or reduce its share
                    capital or redeem or reduce its capital redemption or other
                    reserve; or

          15.1.14   Permitted Indebtedness have any Indebtedness other than
                    Permitted Indebtedness or unsecured intercompany
                    Indebtedness incurred in the ordinary course of business.

     15.2 Positive covenants Except as otherwise agreed in writing by an
          Instructing Group:

          15.2.1    Vessels Each of the Indemnifiers and each of the Guarantors
                    undertakes to procure that in respect of each such relevant
                    Shipowning Guarantor owning such Vessel that is a member of
                    the SO Group and its Subsidiary will comply with the
                    obligations set out in Schedule 14.

          15.2.2    Insurance Proceeds Each of the Indemnifiers and each of the
                    Guarantors shall, and shall procure in respect of its
                    Subsidiaries that (i) all Insurance Proceeds Amounts in
                    connection with any Total Loss are immediately deposited in
                    Lock Box One as additional security for the payment of the
                    Obligations, (ii) any other Insurance Proceeds Amounts are
                    used to meet repair expenses; provided, however, that if
                    repair expenses are likely to exceed a Casualty Amount, the
                    Insurance Proceeds Amounts in respect of such expenses shall
                    be paid to the Agent (if for any reason such Insurance
                    Proceeds Amounts are paid prior to works being completed)
                    and, at the Agent's sole discretion, applied against such
                    expenses upon the works being completed or otherwise or,
                    prior to the occurrence of an Event of Default (whereupon
                    all insurance sums shall be paid to the Agent as additional
                    security for the payment of the Obligations) all Insurance
                    Proceeds Amounts in respect of the Insurances against
                    protection and indemnity or other third party liability
                    risks shall be paid direct to the person to whom was
                    incurred the liability to which such sum relates or, where
                    such liability has been satisfied, to the person who has
                    satisfied such liability in reimbursement to it of moneys
                    expended in satisfaction of such liability.

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<PAGE>

          15.2.3    Financial statements SOSA will supply to the Agent without
                    request (together in each case, where the item is generally
                    available in printed form, with a copy for distribution by
                    the Agent to each of the Banks):

                    (a)  the annual unaudited financial statements of each
                         Obligor that is a Principal Subsidiary of SOSA for each
                         financial year ending during the Facility Period,
                         containing (amongst other things) such Obligor's profit
                         and loss account for, and balance sheet at the end of,
                         each such financial year, prepared in accordance with
                         generally accepted accounting principles and practices
                         applicable to companies incorporated in the relevant
                         jurisdiction consistently applied, in each case within
                         180 days of the end of the financial year to which they
                         relate, together with a certificate of the chief
                         financial officer or chief executive officer of SOSA to
                         the effect that, to the best of his knowledge and
                         belief, such financial statements accurately and fairly
                         represent the financial condition of such Obligor;

                    (b)  on a consolidated basis:

                         (i)  SOSA's annual audited accounts prepared in
                              accordance with US GAAP within 180 days after the
                              end of the financial year to which they relate,
                              together with a report from SOSA's independent
                              public accountants that, such financial statements
                              accurately and fairly represent the financial
                              condition and results of operations of the SO
                              Group; and

                        (ii)  SOSA's unaudited quarterly financial statements
                              (including cash flow analysis) not later than 90
                              days after the end of the relevant fiscal quarter,
                              together with a certificate of the chief financial
                              officer or chief executive officer of SOSA to the
                              effect that, to the best of his knowledge and
                              belief, such financial statements accurately and
                              fairly represent the financial condition and
                              results of operations of the SO Group,

                         in each case with comparisons of actual performance
                         against projected performance;

                    (c)  the Approved Budget for each ensuing financial year, as
                         soon as the same becomes available but in any event not
                         later than the start of such financial year;

                    (d)  together with the Approved Budget, a consolidated cash
                         flow projection of the SO Group for the ensuing
                         financial year and the following two years (broken down
                         by year);

                    (e)  SOSA's monthly unaudited internal management accounting
                         reports comprising the consolidated statement of profit
                         and loss and the consolidated statement of cashflow as
                         soon as practicable but in any event not later than 35
                         days, or, in respect of months of February,

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<PAGE>

                         May, August and November, not later than 60 days, after
                         the month end to which they relate;

                    (f)  a monthly update, within 35 days or, in respect of
                         months of February, May, August and November, within 60
                         days, after month end, on (i) SOSA's receivables and/or
                         collections substantially in the form of Schedule 13
                         and (ii) projects in respect of which the Indemnifiers
                         expect that either (x) revenue will be $1,000,000 or
                         25% (whichever is the higher amount) less or (y) costs
                         $1,000,000 or 25% (whichever is the higher amount)
                         more, than as originally budgeted;

                    (g)  on a monthly basis, within 35 days, or, in respect of
                         months of February, May, August and November, within 60
                         days, after month end, information relating to any
                         Disclosed Permitted Disposal, including quarterly
                         updates as to the progress of any on-going Disclosed
                         Permitted Disposal, and details of any new Eligible
                         Project with a contract value in excess of $25,000,000
                         that any member of the SO Group has agreed to enter
                         into from time to time; and

                    (h)  a rolling 12-week cashflow projection and the other
                         information set forth in Schedule 20 to be provided at
                         the end of each four-week period within 30 days after
                         the end of each such period.

          15.2.4    Other information

                    (a)  Other information SOSA shall promptly provide or cause
                         to be provided to the Agent such other information,
                         financial data and explanations as the Agent may from
                         time to time reasonably require in respect of Obligors
                         that are members of the SO Group and in any event
                         copies of all press releases and all financial and
                         other information from time to time given by SOSA to
                         its shareholders generally.

                    (b)  Presentations The senior executive management and/or
                         members of the board of directors of SOSA shall from
                         time to time at the reasonable request of the Agent,
                         deliver presentations to the Finance Parties in
                         relation to such matters as the Agent may reasonably
                         request.

                    (c)  Risk Management Report At any time at the reasonable
                         request of the Agent, SOSA will engage KPMG or another
                         adviser acceptable to the Agent to produce and deliver
                         an update of their risk management systems analysis
                         report in respect of the SO Group.

                    (d)  Contracts Report At any time at the reasonable request
                         of the Agent, SOSA will engage KPMG or another adviser
                         acceptable to the Agent to produce and deliver a report
                         in relation to any existing

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                         contract or project, including commentary on the status
                         of such contract or project and its performance against
                         budget.

          15.2.5    Certificate of Compliance SOSA shall deliver to the Agent
                    with each set of its annual and quarterly financial
                    statements a duly executed Certificate of Compliance
                    substantially in the form of Schedule 6 certifying (inter
                    alia) compliance with the covenant contained in Clause 15.3.

          15.2.6    Inspection of records SOSA will permit and will cause each
                    member of the SO Group to permit the inspection of its
                    financial records and accounts from time to time on
                    reasonable notice during business hours by the Agent or its
                    nominee.

          15.2.7    Notification of Default SOSA, each of the Indemnifiers and
                    the Guarantors will immediately notify the Agent in writing
                    of the occurrence of any Default or any event which would
                    reasonably be likely to have a Material Adverse Effect.

          15.2.8    Additional Filings SOSA shall ensure that any and all
                    additional filings referred to in the proviso to Clause 7.5
                    will be made and/or effected promptly and within any
                    applicable time limits imposed by law.

          15.2.9    Pari Passu SOSA, each of the Indemnifiers and the Guarantors
                    shall, and shall procure that its Subsidiaries shall, ensure
                    that their respective obligations under this Agreement shall
                    at all times rank at least pari passu with all of their
                    other present and future unsecured and unsubordinated
                    indebtedness with the exception of any obligations which are
                    mandatorily preferred by any applicable laws to companies
                    generally and not by contract.

          15.2.10   Corporate Existence Save as permitted by Clause 15.1.4,
                    SOSA, each Indemnifier and each other Guarantor shall in
                    respect of itself and its Subsidiaries ensure that
                    throughout the Facility Period each of the Obligors shall
                    (i) remain duly formed and validly existing under the laws
                    of its respective jurisdiction of incorporation, (ii) remain
                    authorised to do business in the jurisdiction in which it
                    transacts its business, (iii) continue to have the power to
                    carry on its business as it is now being conducted and to
                    enter into and perform its obligations under the Facility
                    Documents to which it is a party, and (iv) continue to
                    comply with all statutory, regulatory and other requirements
                    relative to its business, the non-compliance with which
                    could reasonably be expected to have a Material Adverse
                    Effect.

          15.2.11   Admissibility in Evidence SOSA, each Indemnifier and each
                    other Guarantor shall on the request of the Agent obtain all
                    necessary authorisations, consents, approvals, licences,
                    exemptions, filings, registrations, recordings and
                    notarisations required or advisable in connection with the
                    admissibility in evidence of the Facility Documents or any
                    of them in Proceedings in England or any other jurisdiction
                    in which Proceedings have been commenced.

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<PAGE>

          15.2.12   SOSA's Company Status SOSA shall ensure that throughout the
                    Facility Period it operates as a financial holding company
                    under Luxembourg law pursuant to the terms of a letter of
                    the "Administration de l'Enregistrement et des Domaines"
                    dated 9 September 1994 and within the restricted scope of
                    its finance holding status.

          15.2.13   Subordinated Debt SOSA shall ensure that throughout the
                    Facility Period the Subordinated Debt shall be provided on
                    the terms of the Subordinated Note, save to the extent that
                    SNTG converts, cancels or contributes the Subordinated Debt
                    in return for the issuance of Common Shares or as otherwise
                    contemplated by the terms of the Subordinated Note.

          15.2.14   Cash Management System SOSA shall procure that each member
                    of the SO Group complies with the Cash Management System.

          15.2.15   Disposals Targets SOSA shall ensure that Disclosed Permitted
                    Disposals are completed on or before each date set out in
                    column 1 below to generate cumulative Net Disposal Proceeds
                    received by such date of not less than the amount
                    corresponding to such date set out in column 2 below:

                                 Column 1                        Column 2
                                   Date                           Amount

                              31 May 2004                      $50,000,000
                              31 August 2004                   $75,000,000

          15.2.16   Insurances SOSA shall procure that each Shipowning Guarantor
                    that is a member of the SO Group shall ensure that each of
                    the Vessels owned by such Shipowning Guarantor is at all
                    times fully insured upon the terms and conditions set forth
                    in Schedule 14.

          15.2.17   Valuations SOSA shall procure that annual Valuations of the
                    Vessels are provided to the Agent no later than each
                    anniversary date of the first Valuations pursuant to Clause
                    6.2.12, and at any other time at the request of the Agent.

          15.2.18   Net Disposal Proceeds and Insurance Proceeds Amounts SOSA
                    shall, and shall procure that a relevant Obligor will,
                    promptly deposit 100% of Net Disposal Proceeds and Insurance
                    Proceeds Amounts in connection with a Total Loss or sale of
                    a Vessel over which there is a first lien for the benefit of
                    the Banks into Lock Box One.

     15.3 SOSA's Financial Covenant/Minimum Consolidated Tangible Net Worth SOSA
          shall not permit its Consolidated Tangible Net Worth on and after each
          date set forth in column 1 below to be less than the amount
          corresponding to such date set forth in column 2 below as determined
          on the basis of the quarterly financials due on the date corresponding
          thereto as set forth in column 3 below; provided, however, that for
          the purposes of compliance with this covenant there shall be deducted
          from Consolidated Tangible Net Worth the amount of any Indebtedness of
          SOSA or any of

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<PAGE>

          its Subsidiaries to SNSA or any of its Subsidiaries that has been
          capitalised after 31 December 2003 and the amount of the Equity
          Contribution:

               Column 1                 Column 2                Column 3
            Measuring Date               Amount        Last Date for Delivery of
                                                           Related Financials

              31 May 2004             $100,000,000           31 August 2004
            31 August 2004            $100,000,000          30 November 2004
           30 November 2004            $85,000,000          28 February 2005
           28 February 2005           $100,000,000             31 May 2005

     In the event that the corresponding covenant with respect to SOSA's
     Consolidated Tangible Net Worth in the Intercreditor, Override and Security
     Trust Deed is re-set as provided in Clause 6.2(b) of the Intercreditor,
     Override and Security Trust Deed, then the equivalent provision in this
     Clause 15.3 shall no longer apply and such re-set covenant in respect of
     SOSA's Consolidated Tangible Net Worth shall be incorporated mutatis
     mutandis, into this Agreement, as though it were set out in full in this
     Agreement.

     15.4 Collateral Value Maintenance Without prejudice to Clauses 8 and 9 SOSA
          shall ensure that:

          15.4.1    Prior to Equity Contribution or no SNSA Guarantee at all
                    times until both the Equity Contribution shall have
                    occurred, and the SNSA Guarantee shall have been duly
                    executed and delivered and from and after the SNSA Guarantee
                    ceases to be in full force and effect (otherwise than in
                    accordance with its terms) or is repudiated, the Cash
                    Collateral shall at all times not be less than 100% of the
                    Bank Guarantee Outstandings at such time;

          15.4.2    Post Equity Contribution after the Equity Contribution shall
                    have occurred (but subject to Clause 15.4.1 with respect to
                    the SNSA Guarantee):

                    (a)  the Value of Qualifying Collateral shall at all times
                         not be less than 100% of the Bank Guarantee
                         Outstandings at such time;

                    (b)  the Cash Collateral shall at all times not be less than
                         50% of the Bank Guarantee Outstandings at such time;
                         and

                    (c)  the Value of Qualifying Vessel Collateral shall at all
                         times be not less than 120% of the difference between
                         the Bank Guarantee Outstandings and the Cash
                         Collateral; and

          15.4.3    Post Covenant Release Date after the Covenant Release Date
                    the Cash Collateral shall at all times not be less than 100%
                    of the aggregate Bank Guarantee Outstandings at such time.

     15.5 Compliance with covenants in the Existing Credit Agreements In the
          event that in connection with the Junior Vessels compliance by any
          Obligor with any covenant or undertaking set out in any Facility
          Document would be inconsistent with

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<Page>

          compliance with an analogous provision set out in an Existing Credit
          Agreement, then compliance with such provision in the relevant
          Existing Credit Agreement shall, for the period of such compliance,
          constitute compliance with the particular similar covenant or
          undertaking in the Facility Document.

     15.6 Covenants and Account Pledge Release In the event that following 30
          September 2005 (i) all Indebtedness under the $440m Loan Agreement has
          been irrevocably and unconditionally repaid in full, (ii) all Bank
          Guarantee Outstandings are fully Cash Collateralised at such time and
          (iii) no Default has occurred and is continuing or would result from
          giving effect to such request or action:

          15.6.1    Covenant Release at the request of the Obligors' Agent, the
                    covenants contained in this Clause 15 (except for Clauses
                    15.1.2, 15.1.3, 15.1.11, 15.2.1, 15.2.2, 15.2.16, 15.2.17,
                    15.2.18 and 15.4.3) shall cease to be binding on the
                    Obligors from the date falling five Business Days after such
                    notification from the Obligors' Agent is received by the
                    Agent (the "Covenant Release Date"); and

          15.6.2    Release of Account Pledge the Agent will instruct the
                    Security Trustee to discharge and release the Account Pledge
                    over Lock Box Two.

16   EARNINGS

     16.1 Remittance of Earnings Immediately upon the occurrence of an Event of
          Default and thereafter for so long as it continues, the Obligors'
          Agent shall procure that all Earnings are paid to such account(s) as
          the Agent shall from time to time specify by notice in writing to the
          Obligors' Agent in accordance with the terms of the Assignments,
          subject to applicable law and prior contractual arrangements.

17   EVENTS OF DEFAULT

     17.1 The Agent's rights If any of the events set out in Clause 17.2 occurs,
          and if such event is in the reasonable opinion of an Instructing Group
          is capable of remedy and remains unremedied for 14 days after notice
          thereof has been given by the Agent to the Obligors' Agent (except in
          relation to any of the events described in Clauses 17.2.1, 17.2.3,
          17.2.4, 17.2.5, 17.2.6, 17.2.7, 17.2.12, 17.2.18 and 17.2.22 where
          such remedy period shall not apply) the Agent may at its discretion
          and shall if so directed by an Instructing Group by notice to the
          Obligors' Agent declare the Banks, the Issuing Banks and the Agent to
          be under no further obligation to the Obligors' Agent or any other
          Obligor under or pursuant to this Agreement including to issue any
          further Bank Guarantees, may declare all or any part of the
          Obligations (including such unpaid interest as shall have accrued) to
          be immediately payable, whereupon the Obligations (or the part of the
          Obligations referred to in the Agent's notice) shall immediately
          become due and payable without any further demand or notice of any
          kind and may exercise its rights under Clause 9.1 to demand cash
          cover.

     17.2 Events of Default The events referred to in Clause 17.1 are:

          17.2.1    payment default if any Obligor defaults in the payment of
                    any part of the Obligations when due (or within three
                    Business Days of such date where default is due solely to an
                    error in the transmission of funds); or

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<PAGE>

          17.2.2    other default if any Obligor fails to observe or perform any
                    of the covenants, conditions, undertakings, agreements or
                    obligations on its part contained in any of the Facility
                    Documents or shall in any other way be in breach of any of
                    the Facility Documents; or

          17.2.3    misrepresentation or breach of warranty if any
                    representation, warranty or statement made, deemed to be
                    made, or repeated under any of the Facility Documents or in
                    any accounts, certificate, notice, instrument, written
                    statement or opinion delivered by or on behalf of an Obligor
                    under or in connection with any Facility Document is
                    incorrect in any material respect when made, deemed to be
                    made or repeated; or

          17.2.4    execution if a distress, diligence or execution or other
                    process of a court or authority is levied on any of the
                    property of any of the Obligors or any of the Principal
                    Subsidiaries before or after final judgment or decree by
                    order of any competent court or authority for an amount in
                    excess of $10,000,000 or its equivalent in any other
                    currency and is not satisfied or stayed (with a view to
                    being contested in good faith) within 14 days of levy; or

          17.2.5    insolvency events if any of the Obligors or any of the
                    Principal Subsidiaries:

                    (a)  resolves to appoint, or applies for, or consents to the
                         appointment of, a receiver, administrative receiver,
                         trustee, administrator or liquidator of itself or of
                         all or part of its assets other than for the purposes
                         of a merger or amalgamation pursuant to Clause 15.1.4;
                         or

                    (b)  is unable or admits its inability to pay its debts as
                         they fall due; or

                    (c)  makes a general assignment for the benefit of
                         creditors; or

                    (d)  ceases trading or threatens to cease trading; or

                    (e)  has appointed an Inspector under the Companies Act 1985
                         or any statutory provision which the Agent in its
                         discretion considers analogous thereto; or

                    (f)  commences negotiations with any one or more of its
                         creditors with a view to the general readjustment or
                         rescheduling of its indebtedness, other than as
                         contemplated by the Intercreditor, Override and
                         Security Trust Deed; or

          17.2.6    insolvency proceedings if (i) any proceedings are commenced
                    or threatened, or any order or judgment is given by any
                    court, for the bankruptcy, liquidation, winding up, or
                    re-organisation of any of the Obligors or any of the
                    Principal Subsidiaries, which proceeding, if not commenced
                    by such Obligor or Principal Subsidiary, is not discharged
                    within 30 days of its commencement; or (ii) if any
                    encumbrancer takes possession of, or a receiver,
                    administrative receiver or administrator or similar officer
                    is appointed over or in relation to, all or any material
                    part of the assets of any Obligor or any Principal
                    Subsidiary; or (iii) a meeting is

                                      -64-
<PAGE>

                    convened, an application is made or any other step is taken,
                    or any notice is given of the intention to convene a meeting
                    or take any other step, for the purpose of appointing a
                    receiver, administrative receiver or other similar officer
                    of or in relation to any Obligor or any Principal
                    Subsidiary; or (iv) an application is made or any other such
                    document is issued, a meeting is convened, or any other step
                    is taken, or any notice is given of the intention to convene
                    a meeting or take any other step, for the purpose of
                    appointing an administrator or other similar officer of, or
                    for the making of an administration order in relation to any
                    Obligor or any Principal Subsidiary; or (v) if any person
                    appoints or purports to appoint a liquidator or trustee in
                    relation to any Obligor or any Principal Subsidiary; or (vi)
                    any creditor seeks to attach or enforce its Encumbrance on
                    any asset of the SO Group; in each case excluding any
                    frivolous or vexatious claims or proceedings.

          17.2.7    impossibility or illegality unless covered by Clause 22.7,
                    if any event occurs which would, or would with the passage
                    of time, render performance of any of the Facility Documents
                    impossible, unlawful or unenforceable by the Banks, the
                    Agent or the Security Trustee; or

          17.2.8    conditions subsequent if any of the conditions set out in
                    Clause 6.2 is not satisfied within the time reasonably
                    required by the Agent with respect to the conditions
                    referred to at Clauses 6.2.1 to 6.2.4 inclusive and
                    otherwise within the time period specified except where such
                    condition has not been satisfied due to an act or omission
                    on the part of a Finance Party; or

          17.2.9    revocation or modification of consents etc. if any material
                    consent, licence, approval or authorisation which is now or
                    which at any time during the Facility Period becomes
                    necessary to enable any of the Obligors to comply with any
                    of their obligations in or pursuant to any of the Facility
                    Documents is revoked, withdrawn or withheld, or modified in
                    a manner which the Agent reasonably considers is, or may be,
                    prejudicial to the interests of the Banks in a material
                    manner, or any material consent, licence, approval or
                    authorisation ceases to remain in full force and effect; or

          17.2.10   curtailment of business if the business of any of the
                    Obligors is wholly or partially curtailed by any
                    intervention by or under authority of any government, or if
                    all or a substantial part of the undertaking, property or
                    assets of any of the Obligors (other than a Vessel referred
                    to in Clause 15.2.2) is seized, nationalised, expropriated
                    or compulsorily acquired by or under authority of any
                    government; or

          17.2.11   loss of Vessel if any Vessel, or any such other vessel which
                    may from time to time be mortgaged to the Banks (or to the
                    Agent or the Security Trustee on their behalf) as security
                    for the repayment of all or any part of the Obligations is
                    arrested, seized, taken in execution, impounded, detained in
                    exercise or purported exercise of any possessory lien or
                    other claim or otherwise taken from the possession of a
                    Shipowning Guarantor and such Shipowning Guarantor shall
                    fail to procure the release of such Vessel

                                      -65-
<PAGE>

                    within 21 days thereafter, provided that such an event is
                    likely to have a Material Adverse Effect, or such Vessel or
                    such other vessel is otherwise destroyed, abandoned,
                    confiscated, forfeited, condemned as prize or otherwise
                    becomes a Total Loss, except that a Total Loss shall not be
                    an Event of Default if:

                    (a)  such Vessel or such other vessel (as the case may be)
                         is insured in accordance with the Facility Documents;
                         and

                    (b)  payment of all Insurance Proceeds Amounts in respect of
                         the Total Loss (as required by Clause 15.2.2) is made
                         in full into Lock Box One on the date which is the
                         earlier to occur of (A) 180 days after the date of the
                         Total Loss of the relevant Mortgaged Vessel occurring
                         and (B) the date on which the relevant Shipowning
                         Guarantor (or the Agent or the Security Trustee as its
                         assignee pursuant to the relevant Assignment or, in
                         respect of the Junior Vessels, any agent or trustee
                         under the Existing Credit Agreements) receives the
                         proceeds of such Total Loss; or

          17.2.12   default of other indebtedness if any other indebtedness or
                    obligation for borrowed money of any of the Obligors or any
                    Principal Subsidiary becomes due or capable of being
                    declared due prior to its stated maturity by reason of
                    default on the part of that Obligor or Principal Subsidiary
                    (as the case may be), or is not repaid or satisfied on the
                    due date for its repayment or any such other loan, guarantee
                    or indebtedness becomes enforceable save, in either case,
                    for amounts of less than five million Dollars ($5,000,000)
                    in the aggregate for all cases, or its equivalent in any
                    other currency, and claims contested in good faith; or

          17.2.13   reduction of capital if any of the Obligors reduces its
                    authorised or issued or subscribed capital except reductions
                    effected in compliance with Clause 15.1.4; or

          17.2.14   challenge to registration if the registration of any Vessel
                    or any Mortgage becomes void or voidable or liable to
                    cancellation or termination and, provided that the Agent is
                    satisfied that such circumstances have arisen for reasons
                    beyond the control of the relevant Shipowning Guarantor or
                    any other member of the SO Group, the relevant Shipowning
                    Guarantor has not within a period of 20 Business Days of the
                    relevant circumstances arising (or such longer period as the
                    Agent may agree) arranged for the re-registration of the
                    relevant Vessel in another jurisdiction subject to a
                    Mortgage in the agreed form and executed such further
                    documents as the Agent may in its absolute discretion
                    require in accordance with Clause 25.5 and provided to the
                    Agent such corporate authorities, vessel documents and legal
                    opinions (consistent with those provided pursuant to Clauses
                    6.1.7 and 6.2.2 and Schedule 9) as the Agent may in its
                    absolute discretion require; or

          17.2.15   war if the country of registration of any Vessel becomes
                    involved in war (whether or not declared) or civil war or is
                    occupied by any other power and the Agent reasonably
                    considers that, as a result, the security conferred by the
                    Facility Documents is materially prejudiced; or

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<PAGE>

          17.2.16   notice of termination if any Guarantor or any Shipowning
                    Guarantor gives notice to the Agent to terminate its
                    material obligations under the Guarantee or any of the
                    Shipowners' Guarantees, as appropriate; or

          17.2.17   claim against Obligor's assets except for Permitted Liens,
                    if a maritime or other Encumbrance, distress or similar
                    charge is levied upon or against any Vessel, or upon or
                    against any substantial part of the assets of SOSA or other
                    Obligor or a Principal Subsidiary (on a consolidated basis)
                    and such is not discharged within 14 Business Days after any
                    Obligor or Principal Subsidiary (as the case may be) has
                    become aware of the same; or

          17.2.18   Obligor's business if all or a substantial part of SOSA's or
                    any Obligor's business is destroyed, abandoned, seized,
                    appropriated or forfeited for any reason; or

          17.2.19   ownership if any of the Indemnifiers, the Senior Shipowning
                    Guarantors or the Guarantors other than SOSA ceases to be
                    100% directly or indirectly beneficially owned by SOSA or,
                    if any of the relevant Junior Shipowning Guarantors ceases
                    to be 100% directly or indirectly beneficially owned by
                    SOSA; or

          17.2.20   final judgments if any of the Obligors fails to comply with
                    any non appealable court order or fails to pay a final
                    unappealable judgment against it, in either case, in excess
                    of $10,000,000 which remains unsettled for 14 days; or

          17.2.21   third party charters if any Obligor fails to comply with
                    Clause 15.1.2; or

          17.2.22   cross default if there occurs and is continuing any Event of
                    Default (as that expression is respectively defined in any
                    of the Existing Credit Agreements) under any of the Existing
                    Credit Agreements; or

          17.2.23   executive management of SOSA if (i) any Executive Officer
                    ceases to serve as a member of the executive management of
                    SOSA (other than as a result of an extended illness or
                    bereavement) and he or she is not replaced by a person
                    satisfactory to an Instructing Group acting reasonably
                    within 45 days of so ceasing to serve, or (ii) the
                    engagement of the Chief Restructuring Officer is terminated
                    prior to the termination date specified in the engagement
                    letter dated 6 November 2003 between the Chief Restructuring
                    Officer and SOSA, (iii) the Chief Executive Officer has not
                    been elected to the board of directors of SOSA by the
                    shareholders of SOSA, or that his appointment to the board
                    of directors of SOSA has not been approved by the
                    shareholders of SOSA, on or before 31 May 2004 or (iv) the
                    Chief Executive Officer is removed from the board of
                    directors of SOSA and is not replaced within 45 days by a
                    person satisfactory to an Instructing Group acting
                    reasonably; or

          17.2.24   invalidity if any Facility Document is not or ceases to be
                    in full force and effect or does not or ceases to constitute
                    the legal, valid, binding and enforceable obligations of the
                    Obligors; or

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          17.2.25   material adverse change if any material adverse change
                    occurs in any of the business, condition (financial or
                    otherwise), operations, performance, properties or prospects
                    of the SO Group (taken as a whole) in the reasonable opinion
                    of the Banks; or

          17.2.26   auditor's qualification if the auditors of SOSA qualify
                    their annual audit report to the consolidated accounts of
                    SOSA in a manner which is, in the opinion of an Instructing
                    Group, material in the context of the Facility Documents and
                    the transactions contemplated in those documents; or

          17.2.27   repudiation if any Obligor repudiates a Facility Document or
                    does or causes to be done any act or thing evidencing an
                    intention to repudiate a Facility Document; or

          17.2.28   litigation if any litigation, arbitration, administrative,
                    governmental, regulatory or other investigations,
                    proceedings or disputes are commenced or overtly threatened
                    in relation to the Facility Documents or the transactions
                    contemplated in the Facility Documents or against any member
                    of the SO Group or its assets which is reasonably likely to
                    be determined against such member of the SO Group and if so
                    determined could, in the opinion of an Instructing Group,
                    reasonably be expected to have a Material Adverse Effect.

18   SET-OFF AND LIEN

     18.1 Set-off Each of the Obligors' Agent, the Indemnifiers and the
          Guarantors irrevocably authorises the Finance Parties at any time
          after all or any part of the Obligations shall have become due and
          payable to set off without notice any liability of the Obligors'
          Agent, any Indemnifier or any Guarantor (as the case may be) to any of
          the Finance Parties (whether present or future, actual or contingent,
          and irrespective of the branch or office, currency or place of
          payment) against any credit balance from time to time standing on any
          account of the Obligors' Agent, such Indemnifier or such Guarantor (as
          the case may be) (whether current or otherwise and whether or not
          subject to notice) with any branch of any of the Finance Parties in or
          towards satisfaction of the Obligations and, in the name of that
          Finance Party, the Obligors' Agent, such Indemnifier or such Guarantor
          (as the case may be), to do all acts (including converting or
          exchanging any currency) and execute all documents which may be
          required to effect such application.

     18.2 Lien If an Event of Default has occurred and is continuing, each
          Finance Party shall have an Encumbrance on and be entitled to retain
          and realise as additional security for the repayment of the
          Obligations any cheques, drafts, bills, notes or negotiable or
          non-negotiable instruments and any stocks, shares or marketable or
          other securities and property of any kind of the Obligors' Agent, the
          Indemnifiers or the Guarantors (or of that Finance Party as agent or
          nominee of the Obligors' Agent, such Indemnifier or such Guarantor)
          from time to time held by that Finance Party, whether for safe custody
          or otherwise.

     18.3 Restrictions on withdrawal Despite any term to the contrary in
          relation to any deposit or credit balance at any time on any account
          of the Obligors' Agent, any Indemnifier or any Guarantor (as the case
          may be) with any of the Finance Parties, no

                                      -68-
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          such deposit or balance shall be repayable or capable of being
          assigned, mortgaged, charged or otherwise disposed of or dealt with by
          the Obligors' Agent, such Indemnifier or such Guarantor (as the case
          may be) after an Event of Default has occurred and while such Event of
          Default is continuing, but any Finance Party may from time to time
          permit the withdrawal of all or any part of any such deposit or
          balance without affecting the continued application of this Clause.

     18.4 Application Whilst an Event of Default is continuing, each of the
          Obligors' Agent, the Indemnifiers and the Guarantors irrevocably
          authorises the Agent to apply all sums which the Agent may receive:

          18.4.1    pursuant to a sale or other disposition of a Vessel or any
                    right, title or interest in a Vessel; or

          18.4.2    by way of payment to the Agent of any sum in respect of the
                    Insurances, Earnings or Requisition Compensation of a
                    Vessel; or

          18.4.3    otherwise pursuant to, arising under or in connection with
                    any of the Facility Documents,

          in or towards satisfaction, or by way of retention on account, of the
          Obligations, in such manner as the Agent may in its discretion
          determine.

19   ASSIGNMENTS BY OBLIGORS

     19.1 Assignments and transfers by the Obligors No Obligor shall be entitled
          to assign or transfer all or any of its rights, benefits and
          obligations hereunder, except with respect to the appointment of a
          successor Obligors' Agent which is made in accordance with the
          definition thereof in Clause 1.1.

20   ADDITIONAL INDEMNIFIERS

     20.1 Additional Indemnifiers

          20.1.1    An Indemnifier may request that any of SOSA's trading
                    Subsidiaries becomes an Additional Indemnifier. That
                    Subsidiary shall become an Additional Indemnifier upon the
                    following conditions being satisfied:

                    (a)  the Agent shall approve the addition of that Subsidiary
                         as an Additional Indemnifier;

                    (b)  the Agent shall have received a duly completed and
                         executed Accession Agreement with respect to such
                         Subsidiary;

                    (c)  no Default shall be continuing or would occur as a
                         result of that Subsidiary becoming an Additional
                         Indemnifier; and

                    (d)  the Agent shall have received such documents and other
                         evidence listed in Clause 6.1 in relation to such
                         Additional Indemnifier as the Agent shall deem
                         appropriate, each in form and substance reasonably
                         satisfactory to the Agent.

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          20.1.2    The Agent shall notify the Indemnifiers and the Issuing
                    Banks promptly upon the provisions of Clause 20.1.1 having
                    been satisfied with respect to an Additional Indemnifier.

21   ASSIGNMENTS AND TRANSFERS BY FINANCE PARTIES AND SUB-PARTICIPATION

     21.1 Right to assign Each of the Banks may with the prior written consent
          of the Issuing Banks assign or transfer all or any of its rights under
          or pursuant to the Facility Documents to any other branch of that Bank
          or to any other bank or financial institution, and may grant
          sub-participations in all or any part of its Commitment and Bank
          Guarantee Outstandings provided that such assignment or transfer does
          not result in an Indemnifier being subject to any additional Tax or
          other financial or legal obligations other than those contemplated by
          the terms of this Agreement at the time of such assignment or
          transfer.

     21.2 Indemnifier's co-operation Each of the Indemnifiers and the Guarantors
          will co-operate fully with the Banks in connection with any
          assignment, transfer or sub-participation pursuant to Clause 21.1,
          will execute and procure the execution of such documents as the Banks
          may require in connection therewith, and irrevocably authorises each
          of the Finance Parties to disclose to any proposed assignee,
          transferee or sub-participant (whether before or after any assignment,
          transfer or sub-participation and whether or not any assignment,
          transfer or sub-participation shall take place) all information
          relating to the Obligors, the Facility or the Facility Documents which
          each such Finance Party may in its discretion consider necessary or
          desirable (subject to any duties of confidentiality applicable to the
          Banks generally).

     21.3 Rights of assignee Any assignee, transferee or sub-participant of a
          Bank shall (unless limited by the express terms of the assignment,
          transfer or sub-participation) take the full benefit of every
          provision of the Facility Documents benefiting that Bank.

     21.4 Transfer Certificates

          21.4.1    If any Bank wishes to transfer all or any of its Commitment
                    and interest in the Bank Guarantee Outstandings as
                    contemplated in Clause 21.1 then such transfer shall be
                    effected upon the payment of a transfer fee equal to $2,000
                    and by the delivery to the Agent of a duly completed and
                    duly executed Transfer Certificate in which event, on the
                    later of the Transfer Date specified in such Transfer
                    Certificate and the fifth Business Day after the date of
                    delivery of such Transfer Certificate to the Agent:

                    (a)  to the extent that in such Transfer Certificate the
                         Bank which is a party thereto seeks to transfer its
                         Commitment and the interest in Bank Guarantee
                         Outstandings in whole, the Obligors and such Bank shall
                         be discharged and released from further obligations
                         towards each other under this Agreement and their
                         respective rights against each other shall be cancelled
                         other than existing claims against such Bank for breach
                         of this Agreement (such rights, benefits and
                         obligations being referred to in this Clause 21.4 as
                         "discharged rights and obligations");

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                    (b)  the Obligors and the Transferee which is a party to
                         such Transfer Certificate shall assume obligations
                         towards one another and/or acquire rights against one
                         another which differ from such discharged rights and
                         obligations only insofar as the Obligors and such
                         Transferee have assumed and/or acquired the same in
                         place of the Obligors and such Bank; and

                    (c)  the Agent, the Transferee and the other Banks shall
                         acquire the same rights and benefits and assume the
                         same obligations between themselves as they would have
                         acquired and assumed had such Transferee been an
                         original party to this Agreement as a Bank with the
                         rights, benefits and/or obligations acquired or assumed
                         by it as a result of such transfer.

          21.4.2    Power of Attorney In order to give effect to each Transfer
                    Certificate the Finance Parties and the Obligors party
                    hereto each hereby irrevocably and unconditionally appoint
                    the Agent as its true and lawful attorney with full power to
                    execute on their respective behalves each Transfer
                    Certificate delivered to the Agent pursuant to Clause 21.4
                    without the Agent being under any obligation to take any
                    further instructions from or give any prior notice to, any
                    of the Finance Parties or, subject to the Indemnifiers'
                    rights under Clause 21.1, the Obligors before doing so and
                    the Agent shall so execute each such Transfer Certificate on
                    behalf of the other Finance Parties and the Obligors party
                    hereto immediately upon its receipt of the same pursuant to
                    Clause 21.4.

          21.4.3    Notification The Agent shall promptly notify the other
                    Finance Parties, the Transferee and the Indemnifiers on the
                    execution by it of any Transfer Certificate together with
                    details of the amount transferred, the Transfer Date and the
                    parties to such transfer.

22   PAYMENTS, MANDATORY PREPAYMENT, RESERVE REQUIREMENTS AND ILLEGALITY

     22.1 Payments All amounts payable by the Obligor' Agent, the Indemnifiers
          and the Guarantors under or pursuant to any of the Facility Documents
          shall be made payable to the Agent and paid to such accounts at such
          banks as the Agent may from time to time direct to the Obligor' Agent,
          any Indemnifier or any Guarantor (as the case may be), and (unless
          payable in any other Currency of Account) shall be paid in Dollars in
          same day funds (or such funds as are required by the authorities in
          the United States of America for settlement of international payments
          for immediate value). Payments shall be deemed to have been received
          by the Agent on the date on which the Agent receives authenticated
          advice of receipt, unless that advice is received by the Agent on a
          day other than a Business Day or at a time of day (whether on a
          Business Day or not) when the Agent in its reasonable discretion
          considers that it is impossible or impracticable for the Agent to
          utilise the amount received for value that same day, in which event
          the payment in question shall be deemed to have been received by the
          Agent on the Business Day next following the date of receipt of advice
          by the Agent.

     22.2 No deductions or withholdings All payments (whether of principal or
          interest or otherwise) to be made by the Obligor' Agent, any
          Indemnifier and/or any Guarantor

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          pursuant to the Facility Documents shall, subject only to Clause 22.3,
          be made free and clear of and without deduction for or on account of
          any Taxes or other deductions, withholdings, restrictions, conditions
          or counterclaims of any nature unless required by law, and none of the
          Obligors' Agent, the Indemnifiers, or the Guarantors will claim any
          equity in respect of any payment due from it to the Banks, the Issuing
          Banks, the Security Trustee or to the Agent under or in relation to
          any of the Facility Documents.

     22.3 Grossing-up If at any time any law requires (or is interpreted to
          require) or the Obligor' Agent, any Indemnifier or any Guarantor to
          make any deduction or withholding from any payment (or requires the
          Agent to make any such deduction or withholding from any payment
          received or receivable from the Obligor' Agent, any Indemnifier or
          Guarantor), or to change the rate or manner in which any required
          deduction or withholding is made, the Obligor' Agent, such Indemnifier
          or such Guarantor (as the case may be) will promptly notify the Agent
          and, simultaneously with making that payment, will pay to the Agent
          whatever additional amount (after taking into account any additional
          Taxes on, or deductions or withholdings from, or restrictions or
          conditions on, that additional amount) is necessary to ensure that,
          after making the deduction or withholding, each of the Agent, the
          Security Trustee, the Issuing Banks and the Banks in all cases receive
          a net sum equal to the sum which they would have received had no
          deduction or withholding been made.

     22.4 Evidence of deductions If at any time the Obligor' Agent, any
          Indemnifier or any Guarantor is required by law to make any deduction
          or withholding from any payment to be made by it pursuant to any of
          the Facility Documents, the Obligor' Agent, such Indemnifier or such
          Guarantor (as the case may be) will pay the amount required to be
          deducted or withheld to the relevant authority within the time allowed
          under the applicable law and will, no later than 30 days after making
          that payment, deliver to the Agent an original receipt issued by the
          relevant authority, or other evidence reasonably acceptable to the
          Banks, evidencing the payment to that authority of all amounts
          required to be deducted or withheld. If the Obligor' Agent, an
          Indemnifier and/or Guarantor makes any deduction or withholding from
          any payment under or pursuant to any of the Facility Documents, and a
          Bank or Issuing Bank subsequently receives a credit, refund, relief,
          remission or allowance from any tax authority which that Bank or
          Issuing Bank identifies as being referable to that deduction or
          withholding, that Bank or Issuing Bank shall, as soon as reasonably
          practicable, interfering with the businesses operations of that Bank
          or Issuing Bank, pay to the Obligor' Agent, such Indemnifier and/or
          Guarantor an amount equal to the amount of the credit, refund, relief,
          remission or allowance received, if and to the extent that it may do
          so without prejudicing its right to benefit from that credit, refund,
          relief, remission or allowance and without putting itself in any worse
          financial position than that in which it would have been had the
          deduction or withholding not been required to have been made. Nothing
          in this Clause shall be interpreted as imposing any obligation on any
          Bank or Issuing Bank unless requested by the Obligor' Agent, an
          Indemnifier and/or Guarantor to apply for any credit, refund, relief,
          remission or allowance nor as restricting in any way the manner in
          which any Bank or Issuing Bank organises its tax affairs, nor as
          imposing on any Bank or Issuing Bank any obligation to disclose to the
          Obligor' Agent, the Indemnifiers and/or Guarantors any information
          regarding its tax affairs or tax computations. All reasonable costs
          and expenses incurred by any Bank or Issuing Bank in obtaining or
          seeking to obtain a

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<PAGE>

          credit, refund, relief, remission or allowance from any tax authority
          pursuant to this Clause shall be for the relevant Obligor's account.

     22.5 Adjustment of due dates If any payment to be made under any of the
          Facility Documents, shall be due on a day which is not a Business Day,
          that payment shall be made on the next succeeding Business Day (unless
          the next succeeding Business Day falls in the next calendar month in
          which event the payment shall be made on the next preceding Business
          Day). Any such variation of time shall be taken into account in
          computing any interest in respect of that payment.

     22.6 Change in law If, by reason of the introduction of any law, or any
          change in any law, or the interpretation or administration of any law,
          or in compliance with any request or requirement from any central bank
          or any fiscal, monetary or other authority:

          22.6.1    any Finance Party (or the holding company of any Finance
                    Party) shall be subject to any Tax with respect to payments
                    of all or any part of the Obligations or the Banks'
                    Obligations; or

          22.6.2    the basis of Taxation of payments to any Finance Party in
                    respect of all or any part of the Obligations shall be
                    changed; or

          22.6.3    any reserve requirements shall be imposed, modified or
                    deemed applicable against assets held by or deposits in or
                    for the account of or loans by any branch of any Finance
                    Party or its direct or indirect holding company; or

          22.6.4    any ratio (whether cash, capital adequacy, liquidity or
                    otherwise) which any Finance Party or its direct or indirect
                    holding company is required or requested to maintain shall
                    be affected; or

          22.6.5    there is imposed on any Finance Party (or on the direct or
                    indirect holding company of any Finance Party) any other
                    condition in relation to the Obligations or the Facility
                    Documents),

          and the result of any of the above shall be to increase the cost to
          the Agent in undertaking or maintaining the Banks' Obligations, or to
          cause any Finance Party to suffer (in its reasonable opinion) a
          material reduction in its rate of return attributable to its
          participation in the Facility and which it would have been able to
          achieve but for its entering into this Agreement and/or performing its
          obligations under this Agreement, the Finance Party affected shall
          notify the Agent and, on demand to the Indemnifiers by the Agent, the
          Indemnifiers shall from time to time pay to the Agent for the account
          of the Agent the amount which shall compensate that Finance Party or
          the Agent (or the relevant holding company) for such additional cost
          or reduced return. A certificate signed by an authorised signatory of
          the Agent or of the Finance Party affected setting out the amount of
          that payment and the basis of its calculation shall be submitted to
          the Indemnifiers and shall be conclusive evidence of such amount save
          for manifest error or on any question of law.

         This Clause 22.6 does not apply to the extent any increased cost is (i)
         attributable to breach by the relevant Finance Party under the Facility
         Document (ii) attributable to

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          fraud or the wilful breach by the relevant Finance Party of any law or
          regulation or (iii) compensated for by Clause 22.3.

     22.7 Illegality and impracticality Notwithstanding anything contained in
          the Facility Documents, the obligations of any Issuing Bank to issue
          any Bank Guarantee shall terminate in the event that a change in any
          law or in the interpretation of any law by any authority charged with
          its administration shall make it unlawful for any Bank to maintain its
          Commitment. In such event the Issuing Bank affected shall notify the
          Agent and the Agent shall, by written notice to the Indemnifier,
          declare the Issuing Banks, and to the Banks' and/or the Agent's
          obligations (as the case may be) to be immediately terminated.

     22.8 Mitigation Each of the Finance Parties shall, in consultation with the
          Agent, take all reasonable steps to mitigate any circumstances which
          arise and result in any amount becoming payable under, or Commitment
          being cancelled pursuant to this Clause 22, including by way of
          transferring its rights and obligations under the Facility Documents
          to an affiliate thereof, provided that nothing in this Clause 22.8
          shall in any way limit the obligations of the Obligors under the
          Facility Documents.

23   COMMUNICATIONS

     23.1 Method Except for Communications pursuant to Clause 14, which shall be
          made or given in accordance with Clause 14.21, any Communication may
          be given, delivered, made or served (as the case may be) under or in
          relation to this Agreement by letter or fax and shall be in the
          English language and sent addressed:

          23.1.1    in the case of any of the Finance Parties to the Agent at
                    its address at the head of this Agreement (fax no: + 44 20
                    (0) 7991 4351 marked for the attention of: Chris D. Merrett;
                    and

          23.1.2    in the case of the Obligor' Agent, each Indemnifier and/or
                    each Guarantor to the Communications Address;

          or to such other address or fax number as the Finance Parties, any
          Indemnifier or any Guarantor may designate for themselves by written
          notice to the others.

     23.2 Timing A Communication shall be deemed to have been duly given,
          delivered, made or served to or on, and received by a party to this
          Agreement except as otherwise expressly provided:

          23.2.1    in the case of a fax when the sender receives one or more
                    transmission reports showing the whole of the Communication
                    to have been transmitted to the correct fax number;

          23.2.2    if delivered to an officer of the relevant party or (in the
                    case of the Obligor' Agent, any Indemnifier and/or any
                    Guarantor) left at the Communications Address at the time of
                    delivery or leaving; or

          23.2.3    if posted, at 9.00 a.m. on the third Business Day after
                    posting by prepaid first class post.

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          All Communications shall be in writing and unless otherwise stated be
          by fax or letter. Any Communication by fax shall be promptly confirmed
          in writing by post or hand delivery.

24   GENERAL INDEMNITIES

     24.1 Currency In the event of any Finance Party receiving or recovering any
          amount payable under any of the Facility Documents in a currency other
          than the Currency of Account, and if the amount received or recovered
          is insufficient when converted into the Currency of Account at the
          date of receipt to satisfy in full the amount due, the Indemnifiers
          and/or the Guarantors (as the case may be) shall, on the Agent's
          written demand, pay to the Agent such deficit in the Currency of
          Account as is sufficient to satisfy in full the amount due and that
          deficit shall be due to the Agent on behalf of the Finance Parties as
          a separate debt under this Agreement.

     24.2 Costs and expenses Each of the Indemnifiers and the Guarantors will,
          within 14 days of the Agent's written demand or as otherwise provided
          in this Agreement, reimburse the Agent (on behalf of each of the
          Finance Parties) for all reasonable out of pocket expenses including
          all reasonable professional fees (including accountants', insurance
          advisers, valuers' and legal fees) (including Value Added Tax or any
          similar or replacement tax if applicable) of and incidental to:

          24.2.1    the negotiation, syndication, preparation, execution and
                    registration of the Facility Documents (whether or not any
                    of the Facility Documents are actually executed or
                    registered and whether or not any Bank Guarantee is issued);

          24.2.2    any amendments, addenda or supplements to any of the
                    Facility Documents (whether or not completed);

          24.2.3    any other documents which are required to give effect to any
                    of the Facility Documents or which any Finance Party is
                    entitled to call for or obtain pursuant to any of the
                    Facility Documents (including, without limitation, all
                    premiums and other sums from time to time payable by the
                    Agent or the Security Trustee in relation to the Mortgagees'
                    Insurances); and

          24.2.4    the exercise of the rights, powers, discretions and remedies
                    of the Finance Parties under or pursuant to the Facility
                    Documents.

     24.3 Events of Default Each of the Indemnifiers and the Guarantors shall
          indemnify the Finance Parties from time to time on demand against all
          losses and costs incurred or sustained by any Finance Party as a
          consequence of any Event of Default.

     24.4 Protection and enforcement Each of the Indemnifiers and the Guarantors
          shall indemnify the Finance Parties from time to time on demand
          against all losses, costs and liabilities which any Finance Party may
          from time to time sustain, incur or become liable for in or about the
          protection, maintenance or enforcement of the rights conferred on the
          Finance Parties by the Facility Documents or in or about the exercise
          or purported exercise by the Finance Parties of any of the rights,
          powers, discretions or remedies vested in them under or arising out of
          the Facility Documents, including (without limitation) any losses,
          costs and liabilities which any Finance Party may

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          from time to time sustain, incur or become liable for by reason of any
          Finance Party being mortgagees of any Vessel and/or a registered owner
          of shares as security holder under a Share Pledge and/or a lender or
          guarantee provider to the Indemnifier, or by reason of any Finance
          Party being deemed by any court or authority to be an operator or
          controller, or in any way concerned in the operation or control, of
          any Vessel. No such indemnity will be given to a Finance Party where
          any such loss, cost or liability has occurred due to gross negligence
          or wilful misconduct on the part of that Finance Party however this
          shall not affect the right of any other Finance Party to receive any
          such indemnity.

     24.5 Reimbursement of Finance Parties Each of the Indemnifiers and the
          Guarantors will from time to time reimburse the Finance Parties on
          demand for all sums which any Finance Party may or is required to pay
          on account of any of the Obligors or in connection with any Vessel
          (whether alone or jointly or jointly and severally with any other
          person) including (without limitation) all sums which any Finance
          Party may or is required to pay or guarantees which any Finance Party
          may or is required to give in respect of the Insurances, any expenses
          incurred by any Finance Party in connection with the maintenance or
          repair of any Vessel or in discharging any Encumbrance, bond or other
          claim relating in any way to any Vessel, and any sums which any
          Finance Party may or is required to pay or guarantees which they may
          or are required to give to procure the release of any Vessel from
          arrest or detention.

     24.6 Taxes Each of the Indemnifiers and the Guarantors shall pay all Taxes
          to which all or any part of the Obligations or any of the Facility
          Documents may be at any time subject and shall indemnify the Finance
          Parties on demand against all liabilities, costs, claims and expenses
          resulting from any omission to pay or delay in paying any such Taxes.
          The indemnity contained in this Clause shall survive the repayment of
          the Obligations.

25   MISCELLANEOUS

     25.1 Waivers No failure or delay on the part of any Finance Party in
          exercising any right, power, discretion or remedy under or pursuant to
          any of the Facility Documents, nor any actual or alleged course of
          dealing between any Finance Party and any of the Obligors, shall
          operate as a waiver of, or acquiescence in, any default on the part of
          any Obligor, unless expressly agreed to do so in writing by the Agent,
          nor shall any single or partial exercise by any Finance Party of any
          right, power, discretion or remedy preclude any other or further
          exercise of that right, power, discretion or remedy, or the exercise
          by a Finance Party of any other right, power, discretion or remedy.

     25.2 No oral variations No variation or amendment of any of the Facility
          Documents shall be valid unless in writing and signed on behalf of the
          Finance Parties by the Agent and the relevant Obligor or Obligors, as
          the case may be.

     25.3 Severability If at any time any provision of any of the Facility
          Documents is invalid, illegal or unenforceable in any respect that
          provision shall be severed from the remainder and the validity,
          legality and enforceability of the remaining provisions shall not be
          affected or impaired in any way.

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     25.4 Successors etc. The Facility Documents shall be binding on the
          Obligors and shall enure to the benefit of the Finance Parties and
          their respective successors, transferees and assignees. Neither any
          Indemnifier nor any Guarantor may assign or transfer any of its rights
          or duties under or pursuant to any of the Facility Documents without
          the prior written consent of the Banks.

     25.5 Further assurance If any provision of the Facility Documents shall be
          invalid or unenforceable in whole or in part by reason of any present
          or future law or any decision of any court, or if the documents at any
          time held by the Finance Parties on their behalf are considered by the
          Banks for any reason insufficient to carry out the terms of this
          Agreement, then from time to time the Indemnifiers and/or the
          Guarantors (as the case may be) will promptly, on demand by the Agent,
          execute or procure the execution of such further documents as in the
          reasonable opinion of the Banks are necessary to provide adequate
          security for the repayment of the Obligations.

     25.6 Other arrangements The Finance Parties may, without prejudice to their
          rights under or pursuant to the Facility Documents, at any time and
          from time to time, on such terms and conditions as they may in their
          discretion determine, and without notice to any Obligor, grant time or
          other indulgence to, or compound with, any other person liable
          (actually or contingently) to the Finance Parties or any of them in
          respect of all or any part of the Obligations, and may release or
          renew negotiable instruments and take and release securities and hold
          funds on realisation or suspense account without affecting the
          liabilities of any Obligor (as the case may be) or the rights of the
          Finance Parties under or pursuant to the Facility Documents.

     25.7 Advisers The Indemnifiers and the Guarantors irrevocably authorise the
          Agent, at any time and from time to time during the Facility Period,
          to consult insurance advisers on any matters relating to the
          Insurances, including, without limitation, the collection of insurance
          claims, and from time to time to consult or retain advisers or
          consultants to monitor or advise on any other claims relating to the
          Vessels. The Indemnifiers and the Guarantors will provide such
          advisers and consultants with all information and documents which they
          may from time to time reasonably require and will reimburse the Agent
          on demand for all reasonable costs and expenses incurred by the Agent
          in connection with the consultation or retention of such advisers or
          consultants.

     25.8 Delegation The Finance Parties may at any time and from time to time
          delegate to any person any of their rights, powers, discretions and
          remedies pursuant to the Facility Documents, other than rights
          relating to actions to be taken by an Instructing Group or the Banks
          as a group on such terms as they may consider appropriate (including
          the power to sub-delegate).

     25.9 Rights etc. cumulative Every right, power, discretion and remedy
          conferred on the Finance Parties under or pursuant to the Facility
          Documents shall be cumulative and in addition to every other right,
          power, discretion or remedy to which they may at any time be entitled
          by law or in equity. The Finance Parties may exercise each of their
          rights, powers, discretions and remedies as often and in such order as
          they deem appropriate subject to obtaining the prior written consent
          of an Instructing Group. The exercise or the beginning of the exercise
          of any right, power, discretion or

                                      -77-
<PAGE>

          remedy shall not be interpreted as a waiver of the right to exercise
          any other right, power, discretion or remedy either simultaneously or
          subsequently.

    25.10 No enquiry The Finance Parties shall not be concerned to enquire into
          the powers of the Obligors or of any person purporting to act on
          behalf of any of the Obligors, even if any of the Obligors or any such
          person shall have acted in excess of their powers or if their actions
          shall have been irregular, defective or informal, whether or not any
          Finance Parties had notice thereof.

    25.11 Continuing security The security constituted by the relevant Facility
          Documents shall be continuing and shall not be satisfied by any
          intermediate payment or satisfaction until the Obligations shall have
          been repaid in full and none of the Finance Parties shall be under any
          further actual or contingent liability to any third party in relation
          to the Vessels, the Insurances, Earnings or Requisition Compensation
          or any other matter referred to in the Facility Documents.

    25.12 Security cumulative The security constituted by the relevant Facility
          Documents shall be in addition to any other security now or in the
          future held by the Finance Parties or any of them for or in respect of
          all or any part of the Obligations, and shall not merge with or
          prejudice or be prejudiced by any such security or any other
          contractual or legal rights of any of the Finance Parties, nor
          affected by any irregularity, defect or informality, or by any
          discharge, release, exchange or variation of any such security.
          Section 93 of the Law of Property Act 1925 and all provisions which
          the Agent considers analogous thereto under the law of any other
          relevant jurisdiction shall not apply to the security constituted by
          the relevant Facility Documents.

    25.13 No release or discharge In the event that any amount paid to any
          Finance Party in respect of the Obligations is avoided on insolvency,
          liquidation or otherwise then to the extent such payment is avoided,
          the liability of the Obligors in respect of such Obligations and the
          liability for such obligation and security interests granted under the
          Facility Documents shall continue as if such payment had not occurred
          and the release and discharge provided herein (or in any Facility
          Document) or according to this Agreement (or any Facility Document)
          had not occurred.

    25.14 No liability None of the Finance Parties, nor any agent or employee
          of any Finance Party, nor any receiver and/or manager appointed by the
          Agent or the Security Trustee, shall be liable for any losses or any
          special, indirect, consequential or punitive damages which may be
          incurred under or in connection with the Facility Documents or the
          transactions contemplated thereunder, nor liable as mortgagee or
          security holder in possession for any loss on realisation or for any
          neglect or default of any nature for which a mortgagee or security
          holder in possession might otherwise be liable unless such Finance
          Party's action constitutes gross negligence or wilful misconduct. Each
          of the Obligors' Agent, the Indemnifiers and the Guarantors waives,
          discharges, releases and agrees (for itself and on behalf of its
          Subsidiaries) not to sue on any such claim for any such losses or
          damages whether or not accrued and whether or not known or expected to
          exist in its favour, except in the event that such party alleges gross
          negligence or wilful misconduct.

    25.15 Rescission of payments etc. Any discharge, release or reassignment by
          any of the Finance Parties of any of the security constituted by, or
          any of the obligations of any

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          Obligor contained in, any of the relevant Facility Documents shall be
          (and be deemed always to have been) void if any act (including,
          without limitation, any payment) as a result of which such discharge,
          release or reassignment was given or made is subsequently wholly or
          partially rescinded or avoided by operation of any law, unless such
          Finance Party's action constitutes gross negligence or wilful
          misconduct.

    25.16 Subsequent Encumbrances If the Agent or the Security Trustee receives
          notice of any subsequent Encumbrance (other than any Permitted Liens)
          affecting any Vessel, or all or any part of the Insurances, Earnings
          or Requisition Compensation, the Agent may open a new account in its
          books for the Indemnifiers. If the Agent does not open a new account,
          then (unless the Encumbrance is permitted by the terms of this
          Agreement or the Agent gives written notice to the contrary to the
          Indemnifiers) as from the time of receipt by the Agent of notice of
          such subsequent Encumbrance, all payments made to the Agent shall be
          treated as having been credited to a new account of the Indemnifiers
          and not as having been applied in reduction of the Obligations.

    25.17 Releases If any Finance Party shall at any time in its discretion
          discharge or release any party from all or any part of any of the
          Facility Documents or from any term, covenant, clause, condition or
          obligation contained in any of the Facility Documents, the liability
          of any other party to the Facility Documents shall not be varied or
          diminished.

    25.18 Certificates Any certificate or statement signed by an authorised
          signatory of the Agent purporting to show the amount of the
          Obligations (or any part of the Obligations) or any other amount
          referred to in any of the Facility Documents shall, save for manifest
          error or on any question of law, be conclusive evidence as against the
          relevant Obligor of that amount.

    25.19 The Banks' Obligations Neither the Agent, nor the Security Trustee
          nor any agent or employee of the Agent or the Security Trustee shall
          be liable to the Obligors for any loss or damage arising from any
          action taken or omitted in relation to the Banks' Obligations, unless
          caused by its or their gross negligence or wilful misconduct. In
          particular, but without limitation, neither the Agent nor any agent or
          employee of the Agent shall be liable for any loss or damage arising
          from any delay, loss, error, omission, variation or mutilation in the
          transmission, translation, coding or decoding of all or any part of
          the Banks' Obligations or any communication in connection with the
          Banks' Obligations.

    25.20 Survival of representations and warranties The representations and
          warranties on the part of each of the Indemnifiers and the Guarantors
          contained in this Agreement shall survive the execution of this
          Agreement and the advance of the Facility or any part thereof.

    25.21 Counterparts This Agreement may be executed in any number of
          counterparts each of which shall be original but which shall together
          constitute the same.

    25.22 Third Party Rights Other than the provisions of Clause 25.14 which
          the parties hereto acknowledge shall extend to the employees, agents,
          receivers and managers of the Finance Parties and may be relied upon
          by such employees, agents, receivers and managers no term of this
          Agreement shall be enforceable pursuant to the Contracts (Rights of
          Third Parties) Act 1999 by a person who is not a party to this
          Agreement.

                                      -79-
<PAGE>

          For the avoidance of doubt however it shall not be necessary for the
          parties to this Agreement to obtain the consent of the employees,
          agents, receivers and managers of the Finance Parties in order to
          amend, supplement or modify the terms of this Agreement.

    25.23 Loan account Each Bank and each Issuing Bank shall maintain, in
          accordance with its usual practice, an account evidencing the amounts
          from time to time owing to it, actually or contingently, under the
          Facility Documents. The control account shall, in the absence of
          manifest error, be conclusive as to the amount from time to time owing
          by the Indemnifiers, the Guarantors and the Shipowning Guarantors
          under this Agreement and the other Facility Documents.

26   LAW AND JURISDICTION

     26.1 Governing law This Agreement shall in all respects be governed by and
          interpreted in accordance with English law.

     26.2 Jurisdiction For the exclusive benefit of the Finance Parties, the
          parties to this Agreement irrevocably agree that the courts of England
          are to have jurisdiction to settle any disputes which may arise out of
          or in connection with this Agreement and that any Proceedings may be
          brought in those courts. Each of the Obligors' Agent, the Indemnifiers
          and the Guarantors irrevocably waives any objection which it may now
          or in the future have to the laying of the venue of any Proceedings in
          any court referred to in this Clause, and any claim that those
          Proceedings have been brought in an inconvenient or inappropriate
          forum.

     26.3 Alternative jurisdictions Nothing contained in this Clause shall limit
          the right of the Finance Parties to commence any Proceedings against
          any Indemnifier or any Guarantor in any other court of competent
          jurisdiction nor shall the commencement of any Proceedings against the
          Obligors' Agent, any Indemnifier or any Guarantor in one or more
          jurisdictions preclude the commencement of any Proceedings in any
          other jurisdiction, whether concurrently or not.

     26.4 Service of process Without prejudice to the right of the Finance
          Parties to use any other method of service permitted by law, each of
          the Obligors' Agent, the Indemnifiers and the Guarantors irrevocably
          agrees that any claim form, writ, notice, judgment or other legal
          process shall be sufficiently served on it if addressed to it and left
          at or sent by post to the Address for Service, and in that event shall
          be conclusively deemed to have been served at the time of leaving or,
          if posted, at 9.00 a.m. on the third Business Day after posting by
          prepaid first class registered post.

IN WITNESS of which the parties to this Agreement have executed this Agreement
the day and year first before written.
<PAGE>

                                   SIGNATORIES

SIGNED by                           )
duly authorised for and on behalf   )    IAN MCMILLAN
of HSBC BANK PLC                    )    (SENIOR MANAGER)
(as a Bank)                         )
in the presence of:                 )

SIGNED by                           )    BERNARD LANDEAU
duly authorised for and on behalf   )    (HEAD OF ADVISORY SERVICES)
of CREDIT LYONNAIS                  )
(as a Bank)                         )    MICHEL TOLILA
in the presence of:                 )    (VICE PRESIDENT)

SIGNED by                           )
duly authorised for and on behalf   )    SANJIV NAYAR
of DNB NOR BANK ASA                 )    (FIRST VICE PRESIDENT)
(formerly DEN NORSKE BANK           )
ASA                                 )    ALFRED C. JONES, III
(as a Bank)                         )    (SENIOR VICE PRESIDENT
in the presence of: Cathleen Buckley)    AND GENERAL COUNSEL)

SIGNED by                           )
duly authorised for and on behalf   )    MICHAEL ZANDER
of ING CAPITAL LLC                  )    (MANAGING DIRECTOR)
(as a Bank)                         )
in the presence of:                 )

SIGNED by                           )
duly authorised for and on behalf   )    BJOERN SCHILLING
of VEREINS-UND                      )    (VICE PRESIDENT)
WESTBANK AG                         )
(as a Bank)                         )    BIRGIT MARQUART
in the presence of:                 )    (SENIOR VICE PRESIDENT)
<PAGE>

SIGNED by                           )
duly authorised for and on behalf   )    ANNE ENGEN
of NORDEA BANK FINLAND              )    (VICE PRESIDENT)
PLC, NEW YORK BRANCH                )
(as a Bank)                         )    HANS CHR. KJELSRUD
in the presence of:                 )    (SENIOR VICE PRESIDENT)

SIGNED by                           )
duly authorised for and on behalf   )    STEVE DOBSON
of SCOTIABANK EUROPE PLC            )    (DIRECTOR,
(as a Bank)                         )    SPECIAL ACCOUNT MANAGEMENT)
in the presence of:                 )

SIGNED by                           )
duly authorised for and on behalf   )    ARNAUD STEVENS
of NATEXIS BANQUES                  )    (DEPUTY HEAD, CORPORATE BANKING)
POPULAIRES                          )
(as a Bank)                         )    GERARD FOHLEN-WEILL
in the presence of:                 )    (DEPUTY HEAD,
                                         UTILITIES, ENERGY & CONSTRUCTION)

SIGNED by                           )
duly authorised for and on behalf   )    CHRIS D. MERRETT
of HSBC BANK PLC                    )    (MANAGER)
(as the Agent)                      )
in the presence of: Kate Garner     )

SIGNED by                           )
duly authorised for and on behalf   )    IAN MCMILLAN
of HSBC BANK PLC                    )    (SENIOR MANAGER)
(as the Arranger)                   )
in the presence of:                 )

SIGNED by                           )
duly authorised for and on behalf   )    IAN MCMILLAN
of HSBC BANK PLC                    )    (SENIOR MANAGER)
(as the Issuing Bank)               )
in the presence of:                 )
<PAGE>

SIGNED by                           )    BERNARD LANDEAU
duly authorised for and on behalf   )    (HEAD OF ADVISORY SERVICES)
of CREDIT LYONNAIS                  )
(as the Issuing Bank)               )    MICHEL TOLILA
in the presence of:                 )    (VICE PRESIDENT)

SIGNED by                           )
duly authorised for and on behalf   )    SANJIV NAYAR
of DNB NOR BANK ASA                 )    (FIRST VICE PRESIDENT)
(formerly DEN NORSKE BANK           )
ASA                                 )    ALFRED C. JONES, III
(as a Bank)                         )    (SENIOR VICE PRESIDENT
in the presence of: Cathleen Buckley)    AND GENERAL COUNSEL)

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT OFFSHORE S.A.              )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT OFFSHORE                   )    (GENERAL COUNSEL)
SERVICES S.A.                       )
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT OFFSHORE A.S.              )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT OFFSHORE                   )    (GENERAL COUNSEL)
LIMITED                             )
in the presence of: Marc Issacs     )
<PAGE>

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT OFFSHORE INC.              )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT OFFSHORE S.A.              )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of SCS HOLDINGS N.V.                )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT OFFSHORE B.V.              )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLTENBERG A.S.                 )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of SCS HOLDINGS LIMITED             )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT COMEX SEAWAY               )    (GENERAL COUNSEL)
HOLDINGS INC.                       )
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of ETPM DEEPSEA LIMITED             )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of SEAWAY (UK) LIMITED              )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of SOTRAPLEX S.A.                   )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of STOLT OFFSHORE WEST              )    (GENERAL COUNSEL)
AFRICA S.A.S.U.                     )
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of ETPM (UK) LIMITED                )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of ETPM INTERNATIONAL               )    (GENERAL COUNSEL)
(UK) LIMITED                        )
in the presence of: Marc Issacs     )

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of ETPM LOGISTICS B.V.              )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )
<PAGE>

SIGNED by                           )
duly authorised for and on behalf   )    JOHAN RASMUSSEN
of SO MARINE INC.                   )    (GENERAL COUNSEL)
in the presence of: Marc Issacs     )<Page>
                           SUBORDINATED LOAN AGREEMENT

     THIS AGREEMENT is made as of the 30th day of June 2003 and amended and
restated as of August 21, 2003 by and between:

A.   STOLT-NIELSEN TRANSPORTATION GROUP LTD., a Liberian corporation having its
     registered office at 80 Broad Street, Monrovia, Liberia (hereinafter
     referred to as "Lender"); and

B.   STOLT OFFSHORE S.A., a Luxembourg company having its registered office at
     26, rue Louvigny, L-1946 Luxembourg (hereinafter referred to as "SOSA").

                                   WITNESSETH:

     WHEREAS, SOSA has requested Lender to extend SOSA financial assistance for
the purpose set forth in paragraph 2.1 hereof; and

     WHEREAS, Lender is willing to provide such financial assistance on the
terms and conditions more particularly hereinafter set forth.

     NOW, THEREFORE, in consideration of the mutual agreements and covenants
herein and for other good and valuable consideration, the parties hereto agree
as follows:

1.   Liquidity Line

     1.1  Lender hereby agrees to make available to SOSA, during the term hereof
          and on the conditions set forth herein, in one drawing to be made as
          of the date of this Agreement, a credit facility in the principal
          amount of

                       FIFTY MILLION UNITED STATES DOLLARS
                               (U.S. $50,000,000)

2.   Purpose of Loan Facility

     2.1  SOSA shall, directly or through its nominated subsidiary, Stolt
          Offshore B.V., (the "Borrower") use the loan facility for general
          working capital purposes.

3.   Repayment/Prepayment of Principal
<PAGE>

     3.1  Subject to the subordination terms set forth in paragraph 8.1 below,
          all borrowings hereunder may be repaid from time to time as set forth
          in the note.,

4.   Evidence of Balance Outstanding

     4.1  The amount outstanding hereunder shall be evidenced by a Subordinated
          Promissory Note of the Borrower and guarantied by SOSA in the form
          attached hereto as Exhibit A and made a part hereof (the "50M Note").

     4.2  The balance outstanding of the loan hereunder shall be evidenced by
          Lender's records, which records shall be conclusive, absent manifest
          error.

5.   Interest

     5.1  All borrowings under this facility shall bear interest from the date
          of drawdown until such principal amount is paid in full, at a rate of
          twelve per cent (12%) per annum.

     5.2  Subject to the subordination terms set forth in paragraph 8.1 below
          Interest on principal shall be payable quarterly with all accrued and
          unpaid interest due at the time of the repayment of principal.

     5.3  Interest shall be computed on the basis of a year of three hundred
          sixty (360) days for the actual days elapsed.

     5.4  Subject to the subordination terms set forth in paragraph 8.1, in the
          event of default in the payment when due of any amount hereunder, SOSA
          shall pay to Lender, on demand, interest on such amount at a rate of
          fifteen percent (15%) per annum accruing from the date of any such
          default to and including the date of actual payment.

6.   Commitment Fee

     6.1  Lender and SOSA confirm that no commitment fee shall be payable with
          respect to the facility hereunder.

7.   Representation and Warranty, Covenant of SOSA/Events of Default

     7.1  SOSA represents and warrants to Lender that as of the date hereof SOSA
          or any subsidiary is not in default under any loan, credit facility,
          guarantee or other agreement in respect of any borrowing or
          indebtedness.

     7.2  SOSA undertakes and agrees that, other than (i) any equity offering of
          Common Shares pursuant to its "shelf" registration statement and (ii)

                                                                               2
<PAGE>

          issuance of SOSA Common Shares resulting from exercise of stock
          options in normal course, no change in the issued share capital of
          SOSA shall take place without Lender's prior written consent.

     7.3  Subject to the subordination set forth in paragraph 8.1 hereof and
          Exhibit A hereto, SOSA agrees that an event of default hereunder shall
          occur, and Lender shall be entitled to all rights and remedies
          relating thereto, including without limitation declaring all
          principal, all interest and any other amounts due hereunder to be
          immediately due and payable, if any other loan, guarantee, or other
          indebtedness of SOSA or any subsidiary is declared, or is capable of
          being declared, due prematurely by reason of default, or SOSA, or any
          subsidiary fails to make payment in respect thereof on the due date
          for such payment, or security for such other loan, guarantee or
          indebtedness becomes enforceable, save for amounts less than One
          Million United States Dollars (U.S. $1,000,000) and claims being
          contested in good faith by SOSA or any of such parties.

     7.4  SOSA agrees to pay all of Lender's legal expenses in connection with
          this Agreement and the facility established hereunder.

8.   Subordination to Loan Facility Agreements.

     8.1  Anything in this Agreement to the contrary notwithstanding, the amount
          outstanding hereunder is subordinate and junior to all indebtedness
          due under or pursuant to (a) that certain facility agreement dated
          September 22, 2000, as amended from time to time (the "U.S. $440
          Million Facility Agreement" and all terms used but not defined herein
          to be used as defined therein) between Stolt Comex Seaway Finance B.V.
          (the "SCSFBV"), SOSA, as guarantor, the Banks, the Arrangers, Den
          norske Bank ASA in its capacity as agent and security trustee (in such
          capacities the "Agent"), Bank of America N.A., Citibank N.A., and
          others, as the syndication agents and joint book managers, and IN-
          Barings LLC, as documentation agent, (b) to that certain facility
          agreement dated July 9, 2002, as amended from time to time (the "U.S.
          $100 Million Facility Agreement") between the SCSFBV, SOSA, the banks
          listed in Schedule 1 thereto as lenders and Nordea (acting through
          Nordea Bank Norge ASA, Grand Cayman Branch) in its capacity as agent
          and security trustee, and (c) that certain guarantee facility
          agreement dated 21 August 2003 (the "44 Facility Agreement") between
          SCSFBV, the SOSA, the banks listed in Schedule 1 thereto and Den
          norske Bank ASA as facility agent, security trustee and issuing bank
          (the "44 Agent" (the "44 Debt"), The terms of said subordination,
          including restrictions on repayment of principal and payment of
          interest are set forth in the 50M Note and are incorporated herein.

     8.2  Lender and SOSA agree to take all such steps as are necessary to
          effect and maintain the aforesaid subordination.

                                                                               3

<PAGE>

9.   Notices

     9.1  All notices, requests, demands and other communications hereunder
          shall be in writing, in each case to the parties at the address set
          forth below or such other address as the parties may from time to time
          designate:

          (a)  If to Lender, to:

                    Stolt-Nielsen Transportation Group Ltd.
                    8 Sound Shore Drive
                    P.O. Box 2300 Greenwich, Connecticut 06836
                    U.S.A.

                    Attention:  Howard J. Merkel, Treasurer

                    Telefax:    (203) 635-3957

          (b)  If to SOSA or the Borrower, to:

                    Stolt Offshore, S.A./Stolt Offshore B.V.
                    c/o Stolt Offshore M.S. Ltd.
                    1st Floor
                    Dolphin House
                    Windmill Rd
                    Sunbury-on-Thames
                    Middlesex TW15 7HT
                    ENGLAND

                    Attention:  Stuart Jackson, Chief Financial Officer

                    Telefax:    44 1932 773701

     9.2  Any notice hereunder shall be deemed to be received when personally
          delivered, twenty four (24) hours after dispatch in the case of
          telefax and three (3) business days after transmittal in the case of
          registered mail.

10.  Benefit and Binding Effect: Assignment

     10.1 This Agreement shall be binding upon and operate for the benefit of
          the parties hereto and their respective successors and assigns.

11.  Applicable Law and Jurisdiction

                                                                               4
<PAGE>

     11.1 This Agreement shall be governed by, construed and enforced in
          accordance with the laws of the State of New York, United States of
          America.

     11.2 Each of the parties hereto hereby submit to the courts of the State of
          New York in the City of New York and the federal courts of the United
          States located in the City of New York solely for the purposes of any
          claim or controversy arising out of the Agreement and hereby waives
          all claims of forum non-convenience relating to said courts.

12.  Construction and Amendment

     12.1 This Agreement constitutes the entire agreement between the parties
          pertaining to the subject matter hereto and supersedes all prior
          agreements and understandings of the parties in connection herewith.

     12.2 This Agreement may be amended or modified only by writing signed by
          each of the parties hereto and cannot be changed or modified orally.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.

STOLT-NIELSEN TRANSPORTATION GROUP LTD.

By: /s/ Howard J. Merkel
   ---------------------------------------------
   Howard J. Merkel, Treasurer
   (executed at Greenwich, Connecticut, U.S.A)

STOLT OFFSHORE S.A.

By: /s/ Stuart, Jackson
   ---------------------------------------------
   Stuart, Jackson, Chief Financial Officer
   (executed at Sunbury-on-Thames, Middlesex, England)

                                                                               5

<PAGE>
                                                                      Exhibit A

                     AMENDED AND RESTATED SUBORDINATED NOTE

$50,000,000                                                      August 21, 2003

     FOR VALUE RECEIVED, but subject to the restrictions hereinbelow contained,
Stolt Offshore B.V. (the "Company") promises to pay to the order of Stolt
Nielsen Transportation Group Ltd, a Liberian corporation, (the "Payee") on
demand the principal sum of FIFTY MILLION DOLLARS in lawful money of the United
States of America. Subject to the restrictions hereinbelow contained, the
Company also promises to pay interest on the unpaid principal amount of this
Note from the date hereof until the principal amount of this Note is paid in
full, at a rate of twelve per cent (12%) per annum. Subject to the restrictions
hereinbelow contained, the Company will pay interest quarterly in arrears on the
last day of each fiscal quarter (each such date an "Interest Payment Date").
Whenever any payment hereunder shall be due on a day that is not a business day
such payment shall instead be made on the immediately succeeding business day
and interest shall continue to accrue during such extended period.

     This Note is subject to the express condition that at no time shall the
Company be obligated or required to pay interest on the principal balance due
under this Note at a rate that could subject the Company or holder of this Note
to either civil or criminal liability as a result of such interest rate being in
excess of the maximum interest rate that the Company is permitted by law or has
agreed by contract to pay (the "Maximum Rate"). If by the terms of this Note,
the Company is at any time required or obligated to pay interest on the
principal balance due under this Note at a rate in excess of any Maximum Rate,
the rate of interest due under this Note shall be deemed to be immediately
reduced to the Maximum Rate, and all prior interest payments in excess of the
Maximum Rate shall be applied and shall be deemed to have been payments in
reduction of the principal balance of this Noie.

     Anything in this Note to the contrary notwithstanding, but subject to the
proviso contained below, the indebtedness evidenced by this Note is subordinate
and junior to all Indebtedness due under or pursuant to:

     (a) that certain facility agreement dated 22 September 2000 (the "440
Facility Agreement") as amended, supplemented or restated from time to time
between Stolt Comex Seaway Finance B.V. (the "Indemnifier"), Stolt Offshore S.A.
(the "Guarantor") the banks listed in Schedule 1 thereto as lenders, Den norske
Bank ASA ("DnB") as facility agent and security trustee (in such capacities the
"440 Agent"), DnB and others as arrangers, DnB and others as syndication agents
and joint book runners and ING Barings LLC as documentation agent (the "440
Debt"); and

     (b) that certain facility agreement dated 9 July 2002 (the "100 Facility
Agreement") as amended, supplemented or restated from time to time between the
Indemnifier, the Guarantor, the banks listed in Schedule 1 thereto as lenders
and Nordea Bank Norge ASA, Grand Cayman Branch in its capacity as agent and
security trustee (in such capacities the "100 Agent") (the "100 Debt"); and
<PAGE>

     (c) that certain guarantee facility agreement dated 21 August 2003 (the "44
Facility Agreement") between the Indemnifier, the Guarantor, the banks listed in
Schedule 1 thereto and Den norske Bank ASA as facility agent, security trustee
and issuing bank (the "44 Agent" (the "44 Debt"),

(the 440 Debt, the 100 Debt and the 44 Debt are together hereinafter referred to
as the "Senior Debt", the 440 Agent, the 100 Agent and the 44 Agent are together
hereinafter referred to as the "Agents" and each an "Agent" and the 440 Facility
Agreement, the 100 Facility Agreement and the 44 Facility Agreement are together
hereinafter referred to as the "Facility Agreements" and each "Facility
Agreement"). Words and expressions defined in the Facility Agreements shall have
the same meanings when used in this Note.

     No payment of interest or principal shall be made under this Note if such
payment conflicts with the terms of any of the Facility Agreements.

     In addition, the following shall apply:

     (i)  No payment of principal shall be made under this Note until 31 July
          2006.

    (ii)  No interest shall be paid under this Note unless the ratio of
          Consolidated Debt to EBITDA as defined in each Facility Agreement has
          remained less than or equal to 3.5:1 for three successive fiscal
          quarters. For this purpose in the calculation of Consolidated Debt to
          EBITDA, the principal debt evidenced hereby (excluding interest),
          Subordinated Debt under the Facility Agreements and SNSA's Liquidity
          Line shall not be included as part of Consolidated Debt; and

   (iii)  While interest may accrue at the simple rate of 12% per annum, prior
          to 31 July 2006, the Company shall not pay interest to the Payee on
          any Interest Payment Date in an amount greater than four point two
          five per cent (4.25%) over LIBOR.

     In the event of any insolvency, bankruptcy, liquidation, reorganisation or
other similar proceedings, or any receivership proceedings in connection
therewith, relative to the Company, and in the event of any proceedings for
voluntary liquidation, dissolution or other winding up of the Company, whether
or not involving insolvency or bankruptcy proceedings, then all principal and
interest on all Senior Debt shall first be paid in full before any payment is
made upon this Note.

     In any of the proceedings referred to in the preceding paragraph, any
payment or distribution of any kind or character, whether in cash, property,
stock or obligations, which may be payable or deliverable in respect of this
Note (a "Note Payment") shall be paid or delivered directly to the Agents for
application in payment of the 440 Debt, the 100 Debt and the 44 Debt on a pro
rata basis unless and until all principal and interest on all Senior Debt shall
have been paid in full. In the event that the Payee received a Note Payment
which Note Payment is not permitted to be made under the terms hereof relating
to the subordination of this Note to the Senior Debt, the Payee shall hold such
Note Payment in trust for the benefit of the relevant Finance Parties and shall
immediately pay over such Note Payment to the Agents on a pro rata basis as
specified above.
<PAGE>

     Until the Senior Debt shall have been paid in full, the Payee shall not:
(i) retain any sums by way of set-off in respect of the principal of, or
interest on, this Note; or (ii) obtain any guaranty of the obligations arising
under this Note except from the Guarantor on the terms set forth below.

     The provisions listed above are for the purpose of defining the relative
rights of the holders of Senior Debt on the one hand, and the holder of this
Note on the other hand, against the Company and nothing herein shall impair, as
between the Company and the holder of this Note, the obligation of the Company,
which is unconditional and absolute, to pay to the holder hereof the principal
hereon in accordance with its terms and the provisions hereof.

     Subsequent to the execution of this Note, the Company and the Payee may
modify this Note to provide that all or any portion of the outstanding principal
balance of this Note may be converted, at the option of the Payee, into the
capital stock of the Company. The material terms of such conversion right,
including, without limitation, the conversation ratio and the class of shares
into which this Note shall be convertible (i.e. common or preferred) shall be
mutually determined by the Company and the Payee as a result of their good faith
negotiations.

     This Note shall insure to the benefit of and be binding upon the parties
hereto and their respective successors and assigns. This Note and the legal
relations between the parties hereto shall be governed by and construed in
accordance with the laws of England.

     All terms of this Note subordinating the rights of the Payee hereunder to
the Finance Parties shall be enforceable by the Finance Parties as against the
Company and the Payee.

     The Company waives presentment for payment, demand, protest and notice of
dishonour in connection with this Note.

     This Note replaces and amends a Promissory Note in an equal principal
amount dated 30 June 2003 made by the Company in favor of the Payee and
continues to evidence the debt therein reflected.

Stolt Offshore B.V.

By:
   --------------------------------

Accepted and Agreed to:

Stolt Nielsen Transportation Group Ltd.

By:
   --------------------------------

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