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                                                                    EXHIBIT 10.3

                          TOURJETS AIRLINE CORPORATION
                        CONSULTING & EMPLOYMENT AGREEMENT

         THIS CONSULTING AND EMPLOYMENT AGREEMENT is between Tourjets Airline
Corporation a Florida corporation ("Tourjets" or the "Company"), its successors
and assigns and Serge Feller "Feller").

         WHEREAS, Feller has agreed to serve as Tourjets Chairman, Chief
Executive Officer and President as of June 01, 2000.

         NOW, THEREFORE, Tourjets and Feller, in consideration of the foregoing
and other mutual covenants and promises contained herein, the sufficiency of
which are hereby acknowledged, hereby agree as follows:

         1. ACCEPTANCE OF EMPLOYMENT.

         Subject to the terms and conditions set forth below, Tourjets agrees to
employ Feller and Feller accepts such employment.

         2. TERM.

         The period of employment shall be from June 01, 2000, through December
31, 2006, unless further extended or sooner terminated as hereinafter set forth.
In the absence of notice, this Agreement shall be renewed on the same terms and
conditions for five years from the date of expiration. If Feller wishes to renew
this Agreement on different terms, Feller shall give written notice to the
Company 180 days before the expiration of this agreement. If the Company does
not wish to renew this Agreement at its expiration, or wishes to renew on
different terms, the Company by the majority of its directors shall give written
notice to Feller no later than 180 days before expiration of the current
contract.

         3. POSITION AND DUTIES.

         Feller shall continue to serve as Chairman, Chief Executive Officer and
President for the duration of this contract. Feller' responsibilities may not be
modified in a way that would be inconsistent with the status of Chief Executive
Officer without the consent of Feller. Following a Change of Control (as
hereinafter defined), Feller' responsibilities may not be changed without mutual
agreement. Feller agrees to render his services to the best of his abilities and
will comply with all policies, rules and regulations of the company and will
advance and promote to the best of his ability the business and welfare of the
Company. Feller shall devote his working time, attention, knowledge and skills
to the business and interests of Tourjets. Feller agrees to accept assignments
on behalf of Tourjets or affiliated companies commensurate with his
responsibilities hereunder.

         4. COMPENSATION AND RELATED MATTERS.

         (a) FIRST YEAR: Feller shall receive a consulting fee of $180,000 per
annum (paid monthly) until such time as Tourjets will receive FAA Part 121
Operating Authority. Tourjets may defer and aggregate the amount owed to Feller
at no interest expense until such time as Tourjets has receives its initial
funding. Tourjets may cancel the consulting portion of this agreement prior to
receiving FAA Part 121 Operating Authority by giving Feller a ten (10) day
written notice. After Tourjets receives FAA Part 121 Operating Authority Feller
shall receive a one-time payment of $371,250 within 10 days. Subsequently,
Feller will become a full time employee of Tourjets and receive a minimum salary
of $225,000 per annum payable in accordance with the payroll procedures for
Tourjets salaried employees in effect during the term of this Agreement.
(b) SECOND, THIRD, FOURTH and FIFTH YEAR BASE SALARY. Feller shall receive a
minimum salary of no less than the previous year base salary plus a minimum
increase of 10% over the prior year. Further, the company's compensation
committee shall recommend and approve an additional increase of the base salary
based on its review each year at least 30 days before the anniversary date of
his employment.

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         (c) ELIGIBILITY FOR BONUS. Feller shall be eligible to receive an
annual bonus pursuant to Tourjets management incentive compensation plan and
successor plans, as the Board of Directors may adopt form time to time.

         (d) STOCK OPTIONS. Feller will be eligible to participate and purchase
Tourjets Common Stock, pursuant to a Stock Option Plan (the "Plan") if and when
available. In the event of a Change in Control as defined below, all Options
shall be immediately exercisable.

         (e) BUSINESS EXPENSES. Feller shall be entitled to reimbursement of
reasonable business related expenses from time to time consistent with Tourjets
policies, including, without limitation, submitting in a timely manner
appropriate documentation of such expenses.
         (f) FRINGE BENEFITS. Feller shall be entitled to participate in all
employee benefit plans made available from time to time to all executives of
Tourjets in accordance with the terms of such plans. In the event this Agreement
is terminated by either party for any reason other than death or for cause,
Feller may participate in Tourjets health and other benefit programs for a
period of two years from the date of Feller' termination, or until Feller
obtains comparable coverage, whichever is earlier.
         (g) PERSONNEL POLICIES, CONDITIONS AND BENEFITS. Except as otherwise
provided herein, Feller' employment shall be subject to the personnel policies
and benefits plans which apply generally to Tourjets employees as the same may
be interpreted, adopted, revised or deleted from time to time, during the term
of this Agreement, by Tourjets in its sole discretion. While this Agreement is
in effect, Feller shall accrue paid vacation at the rate of one month per year.
         (h) INDEMNIFICATION; Tourjets shall provide (or cause to be provided)
to Feller indemnification against all expenses (including attorneys' fees),
judgments, fines and amounts paid in settlements in connection with any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (including an action by or in the
right of Tourjets) by reason of his being or having been an officer, director or
employee of Tourjets or any affiliated entity, advance expenses (including
attorneys' fees) incurred by Feller in defending any such civil, criminal,
administrative or investigative action, suit or proceeding and maintain
directors' and officers' liability insurance coverage (including coverage for
securities-related claims) upon substantially the same terms and conditions as
set forth in the Indemnification Agreement between Feller and Tourjets Airline
Corporation (the "Indemnity Agreement").

         5. TERMINATION OF EMPLOYMENT.

         a) DEATH. Feller' employment hereunder shall terminate upon his death,
in which event Tourjets shall pay all outstanding obligation and have no further
obligation to Feller or his estate with respect to compensation, other than the
disposition of life insurance and related benefits and accrued and unpaid base
salary and incentive compensation, if any, for periods prior to the date of
termination pursuant to the terms of the respective employee benefits and
incentive compensation plans then in effect.
         b) BY TOURJETS FOR DISABILITY. If Feller is unable, or fails, to
perform services pursuant to this agreement through illness or physical or
mental disability and such failure or disability shall exist for twelve (12)
consecutive months, then Tourjets may terminate this Agreement upon written
notice to Feller, in which event Tourjets shall pay all outstanding obligation
as listed in under Section 4.(a) & (b) and have no obligation to Feller with
respect to compensation. If Feller becomes entitled to Social Security benefits
payable on account of disability, he will be deemed conclusively to be disabled
for purposes of this Agreement.
         c) BY TOURJETS FOR CAUSE. (i) Except under the circumstances set forth
in 5(c)(ii) below, the unanimous vote of the Board of Directors may terminate
this Agreement for Cause. "Cause" shall be defined as (A) sustained performance
deficiencies which are communicated to Feller in written performance appraisals
and/or other written communications (including, but not limited to memos and/or
letters) by the Board of Directors, (B) gross misconduct, including significant
acts or omissions constituting dishonesty, intentional wrongdoing and
malfeasance, directly relating to the business of Tourjets, (C) commission of a
felony or any crime involving fraud or dishonesty, or (D) a material breach of
this Agreement. (ii) In the event of a Change of Control, as defined below,
Feller may only be terminated for Cause pursuant to a resolution duly adopted by
the affirmative vote of a majority of the entire membership of the Board, at a
meeting of the Board finding that, in the good faith opinion of the Board,
Feller was guilty of conduct set forth in 5(c)(i)(A), or (B), provided, however,
that Feller may not be terminated for Cause hereunder unless: (1) Feller
receives prior written notice of Tourjets intention to terminate this Agreement
for Cause and the specific reasons therefore; and (2) Feller has an opportunity
to be heard by Tourjets Board and be given, if the acts are correctable, a
reasonable opportunity to correct the act or acts (or non-action) giving rise to

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such written notice. If the Board, by resolution duly adopted by the affirmative
vote of a majority of the entire membership of the Board, finds that Feller
fails to make such correction after reasonable opportunity to do so, this
Agreement may be terminated for Cause in which event Tourjets shall pay all
outstanding obligation as listed in 4. and have no obligation to Feller with
respect to compensation under Section 4(a)&(b) of this Agreement.
         d) BY TOURJETS FOR OTHER THAN CAUSE. In the event the Board terminates
this Agreement for reasons other than Cause or Disability as defined in
sub-paragraph (b), (c) above, Tourjets will pay to Feller within ten (10) days
of notice of termination (or, in the case of incentive bonus compensation, if
any, within ten (10) days of determination of amounts payable under the
applicable bonus plan) the greater of one years base salary, or the undiscounted
remainder under this contract, in each case including deferred salary and/or
bonus compensation, if any, payable under this Agreement. In addition, all
granted but unvested Options shall become immediately registered and
exercisable. In the event that any payment to Feller under this paragraph is
subject to any federal or state excise tax and withholding tax, Tourjets shall
pay to Feller an additional amount equal to the excise tax and withholding tax
imposed including additional federal and state income and excise taxes as a
result of the payments under this paragraph, and such payment will be made when
the excise tax and income taxes are due; provided, however, that Feller agrees
to assist Tourjets by using his best efforts to structure matters so that any
payment to Feller under this paragraph is not subject to any federal or state
excise tax. Whether an excise tax is payable, and the amount of the excise tax
and additional income taxes payable, shall be determined by Feller's accountant
and Tourjets shall hold Feller harmless from any and all taxes, penalties, and
interest that may become due as a result of the failure to properly determine
that an excise tax is payable or the correct amount of the excise tax and
additional income taxes, together with all legal and accounting fees reasonably
incurred by Feller in connection with any dispute with any taxing authority with
respect to such determinations and/or payments.
         e) BY FELLER FOR GOOD REASON. Feller may terminate his employment
hereunder (for purposes of this Agreement "Good Reason") after giving at least
30 days notice in the event that, without Feller' consent, (i) Tourjets
relocates its general and administrative offices or Feller' place of employment
to an area other than the Miami/Ft. Lauderdale Standard Metropolitan Statistical
Area, (ii) he is assigned any duties inconsistent with Section 3 hereof, (iii)
Tourjets reduces his annual base salary as in effect on the date hereof or as
the same may be increased from time to time, except as provided in Section
4(a),(b) above; (iv) Tourjets fails, without Feller' consent, to pay Feller any
portion of his current compensation, or to pay him any portion of an installment
of deferred compensation under any deferred compensation program of Tourjets,
within seven (7) days of the date such compensation is due; (v) Tourjets fails
to continue in effect any compensation plan in which Feller participates which
is material to Feller' total compensation, unless an equitable arrangement
(embodied in an ongoing substitute or alternative plan) has been made with
respect to such plan, or to continue Feller' participation therein (or in such
substitute or alternative Plan) on a basis not materially less favorable, both
in terms of the amount of benefits provided and the level of Feller'
participation relative to other participants; (vi) Tourjets fails to continue to
provide Feller with benefits substantially similar to those enjoyed by Feller
under any of Tourjets pension, life insurance, medical, health and accident, or
disability plans in which Feller was participating, Tourjets takes any action
which would directly or indirectly materially reduce any of such benefits or
deprive Feller of any material fringe benefit enjoyed by Feller; (vii) Tourjets
terminates, or proposes to terminate, Feller' employment hereunder contrary to
the requirements of Section 5(c) hereof (for purposes of this Agreement, no such
termination or purported termination shall be effective); or (viii) the Board
approves the liquidation or dissolution of Tourjets prior to the end of this
Agreement. In the event that Feller decides to terminate this Agreement and his
employment with Tourjets or any successor in interest in accordance with the
provisions of this Section 5(e), Tourjets shall have the same obligations as set
forth in Section 5(d) hereof. Any other payments due or actions required under
this paragraph shall be made as lump sums or taken within 10 days of termination
of the Agreement.
         f) BY FELLER FOR OTHER THAN GOOD REASON. Notwithstanding the above,
Feller may upon giving reasonable notice, not to be less than 30 days, terminate
this Agreement without further obligation on the part of Feller or Tourjets.
         g) CHANGES OF CONTROL. For purposes of this Agreement, a "Change of
Control" includes the occurrence of any one or more of the following events: (i)
any Person, other than the Company, is or becomes the Beneficial Owner (as
defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act")), directly or indirectly, of securities of Tourjets representing
more than 50% of the combined voting power of Tourjets then outstanding
securities; or (ii) during any period of two (2) consecutive years (not
including any period prior to the execution of this Agreement), individuals who
at the beginning of such period constitute the Board of Tourjets and any new
director (other than a director designated by a Person who has entered into an
agreement with Tourjets to effect a transaction described in clause (i), (iii)
or (iv) or this Section 5 (g)) whose election by the Board of

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Tourjets or nomination for election by the stockholders of Tourjets was approved
by a vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute a majority thereof; or (iii) the shareholders of Tourjets approve a
merger or consolidation of Tourjets with any other corporation, other than (A) a
merger or consolidation which would result in the voting securities of Tourjets
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or being converted into voting securities of the surviving
entity), in combination with the ownership of any trustee or other fiduciary
holding securities under an employee benefit plan of Tourjets or any of its
affiliates, at least 50% of the combined voting power of the voting securities
of Tourjets or such surviving entity outstanding immediately after such merger
or consolidation, or (B) a merger or consolidation effected to implement a
recapitalization of Tourjets (or similar transaction) in which no Person
acquires more than 50% of the combined voting power of Tourjets then outstanding
securities; or (iv) the shareholders of Tourjets approve a plan of complete
liquidation of Tourjets or an agreement for the sale or disposition by Tourjets
of all or substantially all of Tourjets assets.
         h) "PERSON" DEFINED. For purposes of this Section, "Person" shall have
the meaning given in Section (3)(a)(9) of the Exchange Act, as modified and used
in Sections 13(d) and 14(d) thereof; however, a Person shall not include (i)
Tourjets Airline Corporation or any of their subsidiaries or affiliates; (ii) a
trustee or other fiduciary holding securities under an employee benefit plan of
Tourjets or any of their subsidiaries.
         i) NOTICE OF TERMINATION. Termination of this Agreement by Tourjets or
termination of this Agreement by Feller shall be communicated by written notice
to the other party hereto; specifically indicating the termination provision
relied upon.
         j) COMPANY PROPERTY. At the termination of Feller' employment, whether
voluntary or involuntary, Feller shall be able to retain all company property,
including without limitation all electronic and paper files and documents and
all copies thereof.

         6. CONFIDENTIALITY.
         (a) Feller recognizes and acknowledges that he will acquire during his
employment with Tourjets information that is confidential to Tourjets and that
represents valuable, special and unique assets of Tourjets ("Confidential
Information"). Such Confidential Information (whether or not reduced to tangible
form) includes, but is not limited to: trade secrets; financing documents and
information; financial data; new product information; copyrights; information
relating to schedules and locations; cost and pricing information; performance
features; business techniques; business methods; business and marketing plans or
strategies; business dealings and arrangements; business objectives; customer
information; sales information; acquisition, merger or business development
plans or strategies; research and development projects; legal documents and
information; personnel information; and any and all other information concerning
Tourjets business and business practices that is not generally known or made
available to the public or to Tourjets competitors or is not readily
ascertainable by other means, which, if misused or disclosed, could adversely
affect the business of Tourjets. Feller agrees that he will not, during
employment with Tourjets and for a period of six months following termination of
employment to disclose any Confidential Information to another corporation.

         7. BENEFICIARY.

         The Beneficiary of any payment due and payable at the time of Feller'
death, or otherwise due upon his death, shall be such person or persons as
Feller shall designate in writing to Tourjets. If no such beneficiary shall
survive Feller, any such payments shall be made to his estate.

         8. INTELLECTUAL PROPERTY.

         (a) Any improvements, new techniques, processes, inventions, works,
discoveries, products or copyrightable or patentable materials made or conceived
by Feller, either solely or jointly with other person(s), (1) during Feller'
period of employment by Tourjets, during working hours; (2) during the period
after termination of his employment during which he is retained by Tourjets as a
consultant; or (3) with use of Tourjets intellectual property or Confidential
Information, shall not be the sole and exclusive property of Tourjets without
royalty or other consideration to Feller.
         (b) Feller agrees to inform Tourjets promptly and in full of such
intellectual property by a full written report setting forth in detail the
procedures used and the results achieved.

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         9. NO WAIVER.

         The failure of either party at any time to enforce any provisions of
this Agreement or to exercise any remedy, option, right, power or privilege
provided for herein, or to require the performance by the other party of any of
the provisions hereof, shall in no way be deemed a waiver of such provision at
the same or at any prior or subsequent time.

         10. GOVERNING LAW.

         All questions concerning the construction, validity, application and
interpretation of this Agreement shall be governed by and construed in
accordance with the laws of the State of Florida without giving effect to any
choice of law or conflict of law provision or rule (whether of Florida or any
other jurisdiction) that would cause the application of the law of any
jurisdiction other than Florida.

         11. ARBITRATION.

         Except as described in Section 6, above any dispute or controversy
arising under or in connection with this Agreement shall be settled exclusively
by arbitration, under the commercial arbitration rules of the American
Arbitration Association. The prevailing party in any such arbitration, or any
court action to enforce or vacate an arbitration award, shall be entitled to its
costs and reasonable attorneys fees from the other party.

         12. VALIDITY.

         The invalidity or unenforceability of any provision or provisions of
this Agreement shall not be deemed to affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.

         13. SUCCESSORS.

         This Agreement shall inure to the benefit of and be binding upon
Tourjets, its successors and assigns, including any corporation or other
business entity which may acquire all or substantially all of Tourjets assets or
business, or within which Tourjets may be consolidated or merged, or any
surviving corporation in a merger involving Tourjets.

         14. WAIVER OF MODIFICATION OF AGREEMENT.

          No waiver or modification of this Agreement shall be valid unless in
writing and duly executed by both parties.

         15. COUNTERPARTS.

          This Agreement may be executed in one or more counterparts, each of
which together will constitute one and the same instrument.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date and year first above written.

         TOURJETS AIRLINE CORPORATION
                                                     /s/ Serge Feller
         ----------------------------                --------------------------
         6/5/00                                     6/5/00<PAGE>   1
                                                                    EXHIBIT 10.1

                             CONTRIBUTION AGREEMENT

                  This Contribution Agreement (this "Agreement") is entered into
as of the 15th day of January, 2001 by and among Torch, Inc., a Louisiana
corporation ("Torch"), Friends of Lime Rock LP, a Delaware limited partnership
("Friends of Lime Rock"), Riverside Investments LLC, a Delaware limited
liability company ("Riverside" and, together with Friends of Lime Rock, "Lime
Rock"), and Torch Offshore, Inc., a Delaware corporation (the "Company").

                  WHEREAS, Torch is the holder of 1,000 shares (the "Initial
Shares") of common stock, par value $0.01 per share, of the Company ("Torch
Common Stock");

                  WHEREAS, Torch is the holder of all the issued and outstanding
common membership interest (the "Common Interest") of Torch Offshore, L.L.C., a
Delaware limited liability company ("Torch LLC"); and

                  WHEREAS, Lime Rock is the holder of all the issued and
outstanding preferred membership interests (the "Preferred Interest") in Torch
LLC; and

                  WHEREAS, Torch and Lime Rock together hold all of the issued
and outstanding membership interests in Torch LLC; and

                  WHEREAS, Torch and Lime Rock each desire to contribute their
membership interests in Torch LLC to the Company in accordance with the terms of
this Agreement;

                  NOW, THEREFORE, in consideration of the representations and
warranties and other good and valuable consideration, the parties hereto hereby
agree as follows:

         Section 1. REPRESENTATIONS AND WARRANTIES

         1.1. Each of Friends of Lime Rock and Riverside hereby represents and
warrants to Torch that:

                  (a) Organization and Good Standing. Each of Friends of Lime
         Rock and Riverside is a limited partnership or limited liability
         company duly organized, validly existing and in good standing under the
         laws of the State of Delaware and has full limited partnership or
         limited liability company power and authority to own, operate and lease
         its assets in the manner currently owned, operated and leased by it.
         The outstanding Preferred Interest in Torch LLC is owned beneficially
         and of record by Friends of Lime Rock and Riverside, free and clear of
         all liens, charges, encumbrances, rights of others, mortgages, pledges
         or security interests and, except as provided in the Limited Liability
         Agreement of Torch LLC, dated as of May 5, 2000 (the "LLC Agreement"),
         is not subject to any agreements or understandings with respect to the
         voting or transfer of any of the Preferred Interest. Except as set
         forth in the LLC Agreement, there are no outstanding subscriptions,
         options, convertible securities, warrants or calls of any kind issued
         or granted by, or binding upon, such party to purchase or otherwise
         acquire or to sell or otherwise dispose of any security of or equity
         interest in Torch LLC. Such party has full legal right to sell, assign
         and transfer the Preferred Interest owned by it to the

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         Company and will, upon delivery of a certificate or certificates
         representing such Preferred Interest to the Company, transfer to the
         Company title to such Preferred Interest, free and clear of any liens,
         charges, encumbrances, rights of others, mortgages, pledges or security
         interests.

                  (b) Authority and Approval. The execution and delivery of this
         Agreement by such party, the performance by it of all the terms and
         conditions hereof to be performed by it and the consummation of the
         transactions contemplated hereby by it have been duly authorized and
         approved by any requisite limited partnership or limited liability
         company action on the part of such party. This Agreement constitutes
         the legal, valid and binding obligation of such party enforceable
         against such party in accordance with its terms, subject to applicable
         bankruptcy, insolvency or other similar laws relating to or affecting
         the enforcement of creditors' rights generally and to general
         principles of equity (regardless of whether enforcement is considered
         in a proceeding in equity or at law).

         1.2. Torch hereby represents and warrants to each of Friends of Lime
Rock and Riverside that:

                  (a) Organization and Good Standing. Torch is a corporation
         duly organized, validly existing and in good standing under the laws of
         the State of Louisiana and has full corporate power and authority to
         own, operate and lease its assets in the manner currently owned,
         operated and leased by it. The outstanding Common Interest in Torch LLC
         is owned beneficially and of record by Torch, free and clear of all
         liens, charges, encumbrances, rights of others, mortgages, pledges or
         security interests and is not subject to any agreements or
         understandings with respect to the voting or transfer of any of the
         Common Interest. There are no outstanding subscriptions, options,
         convertible securities, warrants or calls of any kind issued or granted
         by, or binding upon, Torch to purchase or otherwise acquire or to sell
         or otherwise dispose of any security of or equity interest in Torch
         LLC. Torch has full legal right to sell, assign and transfer the Common
         Interest owned by it to the Company and will, upon delivery of a
         certificate or certificates representing such Common Interest to the
         Company, transfer to the Company title to such Common Interest, free
         and clear of any liens, charges, encumbrances, rights of others,
         mortgages, pledges or security interests.

                  (b) Authority and Approval. The execution and delivery of this
         Agreement by Torch, the performance by it of all the terms and
         conditions hereof to be performed by it and the consummation of the
         transactions contemplated hereby by it have been duly authorized and
         approved by any requisite corporate action on the part of Torch. This
         Agreement constitutes the legal, valid and binding obligation of Torch
         enforceable against Torch in accordance with its terms, subject to
         applicable bankruptcy, insolvency or other similar laws relating to or
         affecting the enforcement of creditors' rights generally and to general
         principles of equity (regardless of whether enforcement is considered
         in a proceeding in equity or at law).

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         1.3. The Company hereby represents and warrants to each of Friends of
Lime Rock and Riverside that:

                  (a) Organization and Good Standing. The Company is a
         corporation duly organized, validly existing and in good standing under
         the laws of the State of Delaware and has full corporate power and
         authority to own, operate and lease its assets in the manner currently
         owned, operated and leased by it. The shares of Torch Common Stock to
         be issued at the Closing have been duly authorized and, when issued and
         delivered in accordance with this Agreement, will be validly issued and
         outstanding and will be fully paid and nonassessable. The issuance and
         delivery of the shares of Torch Common Stock at the Closing is not
         subject to any preemptive right of any stockholder of the Company or to
         any right of first refusal or other similar right in favor of any
         person.

                  (b) Authority and Approval. The execution and delivery of this
         Agreement by the Company, the performance by it of all the terms and
         conditions hereof to be performed by it and the consummation of the
         transactions contemplated hereby by it have been duly authorized and
         approved by any requisite corporate action on the part of the Company.
         This Agreement constitutes the legal, valid and binding obligation of
         the Company enforceable against the Company in accordance with its
         terms, subject to applicable bankruptcy, insolvency or other similar
         laws relating to or affecting the enforcement of creditors' rights
         generally and to general principles of equity (regardless of whether
         enforcement is considered in a proceeding in equity or at law).

                  (c) Capitalization. The authorized common stock of the Company
         consists of 100,000,000 shares of Torch Common Stock and 10,000,000
         shares of preferred stock, par value $0.01 per share (the "Preferred
         Stock"). The Initial Shares are the only shares of Torch Common Stock
         issued and outstanding, all of which are owned beneficially and of
         record by Torch, free and clear of all liens. There are no shares of
         Preferred Stock issued or outstanding, and no options, warrants or
         other securities convertible or exercisable for the Torch Common Stock.
         The Initial Shares have been validly issued, are fully paid and
         nonassessable and are free of preemptive rights.

         Section 2. CAPITAL CONTRIBUTIONS

         2.1. At the Closing, Torch will contribute to the Company the Common
Interest in exchange for such number of shares of Torch Common Stock that, when
aggregated with the Initial Shares, equals 90.06% of the total number of issued
and outstanding shares of Torch Common Stock excluding any shares of Torch
Common Stock issued in a Qualified Public Offering (as defined in the LLC
Agreement).

         2.2. At the Closing, Lime Rock will contribute to the Company the
Preferred Interest in exchange for such number of shares of Torch Common Stock
equal to 9.94% of the total number of issued and outstanding shares of Torch
Common Stock excluding any shares of Torch Common Stock issued in a Qualified
Public Offering. Upon each Distribution Accrual Date (as defined in the LLC
Agreement), any accrued and unpaid dividends on the Preferred Interest will

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be paid to Lime Rock. At the Closing, any unpaid dividends on the Preferred
Interest, accruing daily from the last Distribution Accrual Date, will be paid
to Lime Rock in cash.

         Section 3. CLOSING

         The closing of the transactions contemplated hereby (the "Closing")
will be held at the offices of Baker Botts L.L.P., Houston, Texas, concurrent
with the Company's completion of a Qualified Public Offering after all
conditions set forth in Section 4 have been satisfied or waived.

         Section 4. CONDITIONS TO CLOSING

         The obligations of Torch and Lime Rock under Section 2 and the Closing
are subject to the satisfaction or waiver of the following conditions:

                  (a) The representations and warranties of the parties
         contained herein shall be true and correct when made and as of the date
         of the Closing, and all covenants to be performed by any party under
         this Agreement shall have been performed.

                  (b) The Company shall have completed a Qualified Public
         Offering.

                  (c) Lime Rock and Torch shall have received an opinion of
         Arthur Andersen LLP reasonably satisfactory to each of Lime Rock and
         Torch as to the qualification of the transactions contemplated by this
         Agreement under Section 351(a) of the Internal Revenue Code.

         Section 5. TERMINATION

         5.1. Termination. This Agreement may be terminated at any time prior to
the Closing: (a) by the mutual written consent of the Company, Torch and Lime
Rock; or (b) by the Company, Torch or Lime Rock if the Closing shall not have
occurred on or before June 30, 2001.

         5.2. Effect of Termination. In the event of termination of this
Agreement as provided in Section 5.1, written notice thereof shall forthwith be
given by the terminating party to the other parties, and this Agreement shall
thereupon terminate and become void and have no effect, no party shall have
liability to any other party in respect of this Agreement, and the transactions
contemplated hereby shall be abandoned without further action by the parties
hereto; provided, that such termination shall not relieve any party of any
liability for any willful breach of any covenant or agreement contained in this
Agreement.

                                       4
<PAGE>   5

         Section 6. MISCELLANEOUS PROVISIONS

         6.1. Certificate of Incorporation, Bylaws and Other Actions. Until the
earlier of the Closing or the termination of this Agreement, the Company agrees
that (i) it will not amend its Certificate of Incorporation or its Bylaws,
attached hereto as Exhibit A and Exhibit B, respectively, without the consent of
Lime Rock and (ii) it will not take any action that, if such action were to be
taken by Torch LLC, would, under the terms of the LLC Agreement, require the
consent or approval of Lime Rock or any director or manager designated thereby,
without the consent of Lime Rock.

         6.2. Over-allotment Option. The Company, Torch, and Lime Rock agree
that, pursuant to the over-allotment option granted to the underwriters in the
Company's initial Qualified Public Offering (the "Over-allotment Option"), Torch
and Lime Rock will each be permitted to sell a pro rata share of their Torch
Common Stock, unless the managing underwriter in good faith determines that the
inclusion of such shares will adversely affect the pricing or success of the
offering. Torch's and Lime Rock's pro rata share will be 90.06% and 9.94%,
respectively, of the total number of shares available to be sold pursuant to the
Over-allotment Option.

         6.3. Registration Rights Agreement. Effective as of the date of the
Closing, the Company shall grant registration rights in accordance with Exhibit
G to the LLC Agreement.

         6.4. Entire Agreement; Binding Effect; Amendment; Waivers. This
Agreement constitutes the entire agreement and understanding between the parties
hereto and supersedes all prior agreements and understandings between the
parties, both written and oral, relating to the subject matter of this
Agreement. Each and all of the provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, legal representatives, successors and assigns. This
Agreement may be amended, modified or supplemented if, but only if, that
amendment, modification or supplement is in writing and signed by each party
hereto. No waiver of any right under this Agreement shall be effective unless
evidenced in writing and executed by the party entitled to the benefits thereof.
The waiver of any of the terms and conditions hereof shall not be construed or
interpreted as, or deemed to be, a waiver of any other term or condition hereof;
nor shall any waiver of any single breach or default of any provision hereof be
construed, deemed or interpreted as a waiver of any other breach or default
hereunder occurring before or after that waiver.

         6.5. No Third-Party Beneficiaries. No provision of this Agreement is
intended, or shall be construed, deemed or interpreted, to confer on any person
or entity not a party hereto any rights or remedies hereunder.

         6.6. Application of Delaware Law. This Agreement shall be governed by
and construed and enforced in accordance with the substantive laws of the State
of Delaware.

         6.7. Counterparts. This Agreement may be executed in multiple
counterparts, each of which will be deemed an original, but all of which will
constitute one and the same instrument.

                                       5
<PAGE>   6

         6.8 Expenses. The Company agrees to reimburse Lime Rock for reasonable
fees and expenses, including, but subject to a cap of $30,000, the reasonable
fees of not more than one counsel for Lime Rock, incurred in effecting the
transactions contemplated by this Agreement.

                                       6
<PAGE>   7

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.

                                  TORCH, INC.

                                  By:    /s/ LYLE G. STOCKSTILL
                                     -------------------------------------------
                                  Name:  Lyle G. Stockstill
                                       -----------------------------------------
                                  Title: Chief Executive Officer
                                        ----------------------------------------

                                  RIVERSIDE INVESTMENTS LLC

                                  By:   The Beacon Group Energy Investment Fund
                                        II, L.P., its sole member

                                  By:   Beacon Energy Investors II, L.P., its
                                        general partner

                                  By:    /s/ BRYAN R. MARTIN
                                     -------------------------------------------
                                  Name:  Bryan R. Martin
                                       -----------------------------------------
                                  Title: Partner
                                        ----------------------------------------

                                  FRIENDS OF LIME ROCK LP

                                  By:      Lime Rock Partners LLC,
                                           its general partner

                                  By:    /s/ JOHN T. REYNOLDS
                                     -------------------------------------------
                                  Name:  John T. Reynolds
                                       -----------------------------------------
                                  Title: Managing Member
                                        ----------------------------------------

Accepted and Agreed to:

TORCH OFFSHORE, INC.

By:    /s/ LYLE G. STOCKSTILL
   ---------------------------------
Name:  Lyle G. Stockstill
     -------------------------------
Title: Chief Executive Officer
      ------------------------------

                                       7

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