Stevedoring Services of America, Inc. and Subsidiaries - Page 4

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          received by FRS had a fair market value that was approximately              
          equal to the fair market value of the Services Group stock                  
          surrendered by FRS.                                                         
               Hanseatic was incorporated in Bermuda on April 10, 1974.  As           
          of April 10, 1974, Hanseatic was equally owned by Seattle                   
          Stevedore Co. (a predecessor of Services Group) and Marukyo                 
          Company, Ltd. (Marukyo).  On June 30, 1978, Seattle Stevedore Co.           
          purchased all of Marukyo's interest in Hanseatic.                           
               From 1975 through December 31, 1984, Services Group's                  
          stevedoring affiliates contracted with Martin Re-Insurance                  
          Company and its successor Manhattan Re-Insurance Company (Martin            
          will be used to refer to Martin and/or Manhattan where                      
          appropriate) concerning their LHW Act risks.  The LHW Act risks             
          encompass an employer's liability, under the LHW Act, to pay                
          workers' compensation benefits (including medical, income                   
          replacement, death and survivors, and employee rehabilitation               
          benefits) in respect of injured employees covered by the LHW Act            
          (generally stevedores and longshoremen).  Martin then contracted            
          with Hanseatic to pass on 100 percent of the risks.  Martin was a           
          licensed U.S. insurance company that was unrelated to Services              
          Group.                                                                      
               From 1974 into 1984, Hanseatic entered into various other              
          insurance and reinsurance contracts with related and unrelated              
          companies with respect to risks of Services Group's stevedoring             
          affiliates.  Hanseatic ceased accepting new risks of Services               




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