Exhibit 2.1

                          AGREEMENT AND PLAN OF MERGER


                                      AMONG


                        CORDIANT COMMUNICATIONS GROUP PLC


                          LIGHTHOUSE ACQUISITION, INC.


                                       AND


                         LIGHTHOUSE GLOBAL NETWORK, INC.


                            Dated as of July 4, 2000



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                                TABLE OF CONTENTS


                                                                            Page

ARTICLE I

         DEFINITIONS...........................................................2

         Section 1.1  Definitions..............................................2

ARTICLE II

         THE MERGER...........................................................10

         Section 2.1  The Merger..............................................10
         Section 2.2  Effective Time..........................................10
         Section 2.3  Effects of the Merger...................................11
         Section 2.4  Exchange Ratio..........................................11
         Section 2.5  Conversion and Exchange of Company Stock................11
         Section 2.6  Exchange of Certificates................................12
         Section 2.7  Withholding Rights......................................15
         Section 2.8  Company Stock Options; Other Stock-Based Plans..........16
         Section 2.9  Conversion/Preferred Election; Procedure................17
         Section 2.10  The Surviving Corporation..............................18

ARTICLE III

         THE CLOSING..........................................................19

         Section 3.1  Closing.................................................19

ARTICLE IV

         REPRESENTATIONS AND WARRANTIES OF THE COMPANY........................19

         Section 4.1  Organization, Standing and Power........................19
         Section 4.2  Capital Structure.......................................19
         Section 4.3  Authority Relative to this Agreement....................21
         Section 4.4  Non-Contravention; Approvals and Consents...............21
         Section 4.5  Financial Statements....................................22
         Section 4.6  Absence of Certain Events...............................22
         Section 4.7  Information Supplied....................................23
         Section 4.8  Books and Records.......................................23
         Section 4.9  Title to Properties; Encumbrances.......................24
         Section 4.10  Leases.................................................24
         Section 4.11  Material Contracts.....................................24
         Section 4.12  Accounts Receivable....................................26
         Section 4.13  Legal Proceedings......................................26
         Section 4.14  Permits; Compliance with Laws and Orders...............26
         Section 4.15  Employee Benefit Plans.................................27
         Section 4.16  Employment Relations and Agreement.....................30
         Section 4.17  Taxes..................................................31
         Section 4.18  Intellectual Property..................................34
         Section 4.19  Environmental Laws and Regulations.....................35
         Section 4.20  Liabilities............................................36
         Section 4.21  Insurance..............................................36
         Section 4.22  Acquisition Agreement Payments.........................36
         Section 4.23  Voting Requirements....................................37
         Section 4.24  State Takeover Statutes; Certain Charter Provisions....37
         Section 4.25  Brokers................................................37
         Section 4.26  No Other Representations or Warranties.................37
         Section 4.27  Customers..............................................37

ARTICLE V

         REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB..............38

         Section 5.1  Organization and Qualification..........................38
         Section 5.2  Share Capital...........................................38
         Section 5.3  Authority Relative to this Agreement....................39
         Section 5.4  Non-Contravention; Approvals and Consents...............39
         Section 5.5  SEC Reports and Financial Statements....................40
         Section 5.6  Absence of Certain Changes or Events....................41
         Section 5.7  Legal Proceedings.......................................41
         Section 5.8  Information Supplied....................................41
         Section 5.9  Permits; Compliance with Laws and Orders................42
         Section 5.10  Compliance with Agreements.............................42
         Section 5.11  Vote Required..........................................42
         Section 5.12  Business of Merger Sub.................................42
         Section 5.13  Brokers................................................43
         Section 5.14  Absence of Undisclosed Liabilities.....................43
         Section 5.15  Contracts..............................................43
         Section 5.16  Taxes..................................................43
         Section 5.17  Ownership of Company Stock; Reorganization.............44
         Section 5.18  No Other Representations or Warranties.................44
         Section 5.19  Customers..............................................44

ARTICLE VI

         COVENANTS RELATING TO CONDUCT OF BUSINESS............................44

         Section 6.1  Conduct of Business by the Company Pending the Merger...44
         Section 6.2  No Solicitation.........................................47
         Section 6.3  Third Party Confidentiality Agreements..................48

ARTICLE VII

         ADDITIONAL AGREEMENTS................................................48

         Section 7.1  Access to Information...................................48
         Section 7.2  Actions for Compliance with Securities Laws.............48
         Section 7.3  Approval of Shareholders................................48
         Section 7.4   Contingent Payments ...................................49
         Section 7.5  INTENTIONALLY LEFT BLANK................................49
         Section 7.6  Admission of Parent Shares..............................49
         Section 7.7  Fees and Expenses.......................................50
         Section 7.8  Commercially Reasonable Efforts.........................50
         Section 7.9  Public Announcements....................................50
         Section 7.10  Indemnification; Directors' and Officers' Insurance....51
         Section 7.11 Companies Act Section 103...............................51
         Section 7.12  Dividends, Distributions and Issuances.................51
         Section 7.13  Employee Benefit Plans.................................51
         Section 7.14  Registration Rights....................................51

ARTICLE VIII

         Tax Matters..........................................................54

         Section 8.1  Certain Tax Covenants...................................54
         Section 8.2  Tax Indemnification.....................................55
         Section 8.3  Transfer Taxes..........................................57
         Section 8.4  Amended Returns.........................................57
         Section 8.5  Carrybacks..............................................57
         Section 8.6  Tax Covenants Regarding Merger..........................57
         Section 8.7  Tax Cooperation.........................................58

ARTICLE IX

         CONDITIONS PRECEDENT.................................................59

         Section 9.1  Conditions to Each Party's Obligation to Effect the
                      Merger..................................................59
         Section 9.2  Conditions to Obligation of Parent And Merger Sub to
                      Effect the Merger.......................................61
         Section 9.3  Conditions to Obligation of the Company to Effect
                      the Merger..............................................62

ARTICLE X

         SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION.........................63

         Section 10.1  Survival of Representations............................63
         Section 10.2  Indemnification........................................63
         Section 10.3  Stockholder Indemnitors' Representative................65
         Section 10.4  Indemnification Procedures.............................65
         Section 10.5  Limitations............................................66
         Section 10.6  Adjustment for Insurance...............................67
         Section 10.7  Adjustment for Recoveries under Acquisition Agreements.67
         Section 10.8  Subrogation............................................68
         Section 10.9  Set-Off................................................68
         Section 10.10  Exclusive Remedy......................................68

ARTICLE XI

         TERMINATION, AMENDMENT AND WAIVER....................................68

         Section 11.1  Termination............................................68
         Section 11.2  Effect of Termination..................................69
         Section 11.3  Payment of Certain Fees................................70

ARTICLE XII

         GENERAL PROVISIONS...................................................70

         Section 12.1  Notices................................................70
         Section 12.2  Interpretation.........................................71
         Section 12.3  Counterparts...........................................71
         Section 12.4  Entire Agreement; No Third-Party Beneficiaries.........71
         Section 12.5  Amendment..............................................71
         Section 12.6  Waiver.................................................72
         Section 12.7  Governing Law..........................................72
         Section 12.8  Assignment.............................................72
         Section 12.9  Severability...........................................72
         Section 12.10  Enforcement of this Agreement.........................72
         Section 12.11  Incorporation of Exhibits.............................72

EXHIBIT 1 - Amended and Restated Certificate of the Company
EXHIBIT 2 - Indemnification Letter
EXHIBIT 3 - Election Notice
EXHIBIT 4 - Form of Investor Representation Letter
EXHIBIT 5 - Purchaser Representative Certificate
<PAGE>
                          AGREEMENT AND PLAN OF MERGER


         AGREEMENT  AND  PLAN  OF  MERGER,  dated  as  of  July  4,  2000  (this
"Agreement"), among Cordiant Communications Group plc, a company organized under
the laws of  England  and Wales  ("Parent"),  Lighthouse  Acquisition,  Inc.,  a
Delaware  corporation  and a direct wholly owned  subsidiary of Parent  ("Merger
Sub"),  and  Lighthouse  Global  Network,  Inc.,  a  Delaware  corporation  (the
"Company") (Merger Sub and the Company being hereinafter  collectively  referred
to as the "Constituent Corporations").



                              W I T N E S S E T H:
                               - - - - - - - - - -


         WHEREAS,  Parent,  Merger Sub and the Company intend to effect a merger
of Merger Sub with and into the Company in accordance with this  Agreement,  the
Delaware  General  Corporation Law (the "DGCL") and such other state laws as may
be applicable (the "Merger").  Upon consummation of the Merger,  Merger Sub will
cease to exist,  and the Company will become a direct wholly owned subsidiary of
Parent;

         WHEREAS,  the Merger Sub was organized for the sole purpose of enabling
Parent to acquire the  Company  Stock and Merger Sub has not and will not engage
in any activities of any nature which are not solely for the purpose of enabling
Parent to acquire the Company Stock;

         WHEREAS,  the  respective  boards of directors of Parent and Merger Sub
have approved this  Agreement and the Merger,  upon the terms and subject to the
conditions set forth herein,  and  unanimously  recommend that their  respective
shareholders approve the transactions contemplated by this Agreement;

         WHEREAS, the Board of Directors of the Company has unanimously approved
this  Agreement and the Merger upon the terms and subject to the  conditions set
forth herein,  has determined  that it is advisable and in the best interests of
its  stockholders,  and unanimously  recommends that its stockholders  adopt and
approve this Agreement and the Merger;

         WHEREAS,  it  is  intended  that  the  Merger  qualify  as  a  tax-free
reorganization within the meaning of Section 368(a) of the Internal Revenue Code
of 1986, as amended from time to time (the "Code"); and

         WHEREAS,  to induce Parent and Merger Sub to enter into this  Agreement
and to  consummate  the  Merger,  simultaneously  with  the  execution  of  this
Agreement,  certain  stockholders  of the  Company  owning,  in  the  aggregate,
approximately  86% of the issued and outstanding  shares of Class A Common Stock
(as defined  herein),  are entering into an agreement with Parent and Merger Sub
(the "Stockholders  Agreement")  pursuant to which they have agreed, among other
things, to vote the shares of Class A Common Stock owned by such stockholders in
favor of the  adoption and  approval of this  Agreement  and the approval of the
Merger.


         NOW,   THEREFORE,   in   consideration   of  the   premises   and   the
representations,  warranties and agreements herein contained,  the parties agree
as follows:


                                    ARTICLE I

                                   DEFINITIONS

         Section 1.1 Definitions.  For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires, the terms
defined in this Article have the meanings assigned to them in this Article:

         "Acquisition  Agreements"  means the agreements set forth on Schedule A
attached  hereto,  pursuant  to which the  Company  has  outstanding  contingent
obligations to issue (i) shares of 6% Preferred Stock (or cash in lieu thereof),
whether  directly or in exchange for preference  shares which may be issuable by
Lighthouse Holdings (UK) Limited, and (ii) in the case of the Connect Agreement,
6% Preferred  Stock and Class B Common  Stock (or in either  case,  cash in lieu
thereof).

         "Admission to the Official  List" means  admission to the Official List
of the UKLA becoming effective pursuant to Rule 7.1 of the Listing Rules;

         "Acquisition  Agreement Indemnity" has the meaning set forth in Section
10.7.

         "Admission"  means  Admission to Trading and  Admission to the Official
List.

         "Admission to Trading" means  admission to trading on the LSE's markets
for listed securities becoming effective in accordance with the Standards;

         "Affiliate" of any Person shall mean any Person  directly or indirectly
controlling, controlled by, or under common control with, such Person; provided,
that, for the purposes of this definition, "control" (including with correlative
meanings,  the terms  "controlled by" and under common control  with"),  as used
with respect to any Person,  shall mean the possession,  directly or indirectly,
of the power to direct or cause the direction of the  management and policies of
such Person,  whether through the ownership of voting  securities or partnership
interests, by contract or otherwise.

         "Agreement" has the meaning set forth in the preamble hereto.

         "Audited  Financial  Statement"  has the  meaning  set forth in Section
4.5(a).

         "Amended  and Restated  Certificate"  shall mean the  Company's  Second
Amended and Restated Certificate of Incorporation,  as amended,  attached hereto
as Exhibit 1.

         "Balance Sheet" has the meaning set forth in Section 4.5.

         "Balance Sheet Date" has the meaning set forth in Section 4.5.

         "Blackout Period" has the meaning set forth in Section 7.14(e).

         "business day" means a day other than a Saturday,  a Sunday or a day on
which banks in New York,  New York or London,  England are permitted or required
by law to close.

         "Certificate" has the meaning set forth in Section 2.5(c)(ii).

         "Certificate of Merger" has the meaning set forth in Section 2.2.

         "Circular" has the meaning set forth in Section 4.7.

         "Class A Common Stock" means the Class A Voting Common Stock, par value
$0.0001 per share, of the Company.

         "Class B Common Stock" means the Class B Non-Voting  Common Stock,  par
value $0.0001 per share, of the Company.

         "Closing" has the meaning set forth in Section 3.1.

         "Closing Date" has the meaning set forth in Section 3.1.

         "COC" has the meaning set forth in Section 9.1(h)(i).

         "Code" has the meaning set forth in the fourth WHEREAS clause hereto.

         "Common  Stock  Certificate"  has the  meaning  set  forth  in  Section
2.5(c)(ii).

         "Common  Stock  Exchange  Ratio" has the  meaning  set forth in Section
2.4(b).

         "Companies Act" has the meaning set forth in Section 5.2(a).

         "Company" has the meaning set forth in the preamble hereto.

         "Company  Common  Stock" means the Class A Common Stock and the Class B
Common Stock.

         "Company  Contract"  means each  agreement,  contract or commitment set
forth in Section  4.11 of the Company  Disclosure  Letter (or required to be set
forth in Section 4.11 of the Company Disclosure Letter).

         "Company Disclosure Letter" has the meaning set forth in Section 4.1.

         "Company  Financial  Statements"  has the  meaning set forth in Section
4.5(a).

         "Company's  Knowledge,"  "Knowledge  of the  Company"  means the actual
knowledge,  after  reasonable  inquiry,  of (i) Terence  Graunke,  Tim Donmoyer,
Julian Hanson-Smith, and Kathleen Johnston, with respect to the Company and each
Subsidiary and (ii) with respect to each  Subsidiary,  as applicable,  the Chief
Executive Officer and Chief Financial Officer of each such Subsidiary.

         "Company Material Adverse Effect" means any condition, change or effect
that is materially adverse to the business,  operations or condition  (financial
or otherwise) of the Company and its Subsidiaries taken as a whole.

         "Company  Materiality  Terms"  has the  meaning  set  forth in  Section
10.2(c).

         "Company Permits" has the meaning set forth in Section 4.14.

         "Company  Stock"  means  the Class A Common  Stock,  the Class B Common
Stock and the 8% Preferred Stock.

         "Company Stock Plans" has the meaning set forth in Section 4.2(a).

         "Company Stock Rights" has the meaning set forth in Section 2.8(a)(ii).

         "Company  Stockholders'  Approval" has the meaning set forth in Section
7.3(b).

         "Company  Stockholders'  Meeting"  has the meaning set forth in Section
7.3(b).

         "Connect  Agreement" means the Sale and Purchase Agreement dated 21 May
1999 by and among,  Propose One (BVI) Limited,  Secure One (BVI)  Limited,  Paul
Seligman, Martin Banbury,  Lighthouse Holdings, Inc. and Lighthouse (UK) Limited
and related Stock Restriction  Agreement dated 30 June 1999 and the Put and Call
Option Deed, associated therewith.

         "Constituent  Corporations"  has the meaning set forth in the  preamble
hereto.

         "Contingent  Holder"  means any Person that has a  contingent  right to
receive,  directly or indirectly,  shares of 6% Preferred Stock (or cash in lieu
thereof)  under the  Acquisition  Agreements  set forth on  Schedule  A attached
hereto  and/or,  in the case of the Connect  Agreement,  6% Preferred  Stock and
Class B Common Stock (or in either case, cash in lieu thereof).

         "Contingent Payments" has the meaning set forth in Section 2.9(b).

         "Contracts" has the meaning set forth in Section 4.4(a).

         "Conversion  Election"  means the election by any Contingent  Holder to
receive  Parent  Shares  in  lieu of the 6%  Preferred  Stock  (or  cash in lieu
thereof) and/or,  in the case of the Connect  Agreement,  6% Preferred Stock and
Class B Common  Stock (or in either  case,  cash in lieu  thereof) to which such
Contingent  Holder would  otherwise be entitled  under the terms of the relevant
Acquisition Agreement.

         "Credit  Agreement" means the Credit Agreement,  dated July 8, 1999, as
amended,  among the Company,  Lighthouse  Holdings  (UK) Limited and First Union
National Bank, as Administrative Agent.

         "DGCL" has the meaning set forth in the first WHEREAS clause hereto.

         "Disclosure" has the meaning set forth in Section 7.9.

         "Dissenting   Stock"   means  the  Company   Stock  which  is  held  by
stockholders  who have properly  complied with the  provisions of Section 262 of
the DGCL with respect to appraisal rights.

         "$" shall mean United States dollars.

         "Effective Time" has the meaning set forth in Section 2.2.

         "8% Payment Shares" means 21,273,149 Parent Shares.

         "8%  Preferred  Certificate"  has the  meaning  set  forth  in  Section
2.5(c)(i).

         "8%  Preferred  Stock" means the 8%  Convertible  Redeemable  Preferred
Stock, par value $0.01 per share, of the Company.

         "Election Notice" has the meaning set forth in Section 2.9(a).

         "Employee Benefit Plans" has the meaning set forth in Section 4.15(a).

         "Environmental Law" has the meaning set forth in Section 4.19(a).

         "ERISA" has the meaning set forth in Section 4.15(a).

         "Exchange  Act"  means the U.S.  Securities  Exchange  Act of 1934,  as
amended, and the rules and regulations thereunder.

         "Exchange Agent" has the meaning set forth in Section 2.6(a).

         "Exchange Fund" has the meaning set forth in Section 2.6(a).

         "Exchange Rate" shall mean the average currency exchange rate of pounds
sterling  to US dollars as  published  in the Wall  Street  Journal  over the 10
consecutive  Trading Days ending one Trading Day immediately  preceding the date
hereof.

         "Final Orders" has the meaning set forth in Section 9.1(g).

         "Final Prospectus" has the meaning set forth in Section 7.14(b).

         "FS Act" means the  Financial  Services  Act 1986,  as amended,  of the
United Kingdom;


         "FTA" has the meaning set forth in Section 9.1(h)(i).

         "Governmental  or  Regulatory  Authority"  has the meaning set forth in
Section 4.4(a).

         "Holders" means the holders of record of certificates of Company Common
Stock as of the Effective Time.

         "HSR Act" has the meaning set forth in Section 4.4(b).

         "Indemnifiable Loss" has the meaning set forth in Section 10.6.

         "Indemnification  Agreement"  has the  meaning  set  forth  in  Section
2.6(b)(i).

         "Indemnification Threshold" has the meaning set forth in Section 10.5.

         "Indemnifying Party" has the meaning set forth in Section 10.4(a).

         "Indemnitee" has the meaning set forth in Section 10.4(a).

         "Indemnity Payment" has the meaning set forth in Section 10.6.

         "Intellectual Property" has the meaning set forth in Section 4.18(a).

         "Issuance   Obligation"   means,  with  respect  to  any  Person,   any
outstanding or authorized  options,  warrants,  calls,  rights or subscriptions,
claims of any character, obligations,  convertible or exchangeable securities or
other commitments,  contingent or otherwise,  to which such Person is a party or
by which it is bound  obligating such Person or any Subsidiary of such Person to
issue,  deliver or sell,  or cause to be issued,  delivered or sold,  additional
shares of capital stock of such Person or any of its  Subsidiaries or obligating
such Person or any of its  Subsidiaries to grant,  extend or enter into any such
option, warrant, call, right or agreement.

         "Key Employee" shall mean any officer,  manager,  account  executive or
other  employee who is the senior  person  directly  responsible  for a material
client relationship with the Company or any of the Company's Subsidiaries.

         "Laws" has the meaning set forth in Section 4.4(a).

         "Letter of Transmittal" has the meaning set forth in Section 2.6(b)(i).

         "License" has the meaning set forth in Section 4.18(a).

         "Lien" has the meaning set forth in Section 4.2(b).

         "Listing Particulars" has the meaning set forth in Section 4.7.

         "Listing  Rules" means the Listing  Rules made by the UKLA  pursuant to
Part IV of the FS Act, as amended from time to time;

         "Loss" has the meaning set forth in Section 10.2(a).

         "LSE" means London Stock Exchange Limited.

         "Material  Subsidiaries"  means Bates UK  Limited,  Diamond Ad Limited,
Bates  Gruppen AS,  Grupo Bates SA, The  Communications  Group Pty Ltd,  Sholz &
Friends GmbH,  Bates  Advertising  Holding SA, Bates  Advertising  USA, Inc. and
Healthworld Corporation.

         "Merger" has the meaning set forth in the first WHEREAS clause hereto.

         "Merger Consideration" has the meaning set forth in Section 2.4.

         "Merger Sub" has the meaning set forth in the preamble hereto.

         "Notice" has the meaning set forth in Section 10.4(a).

         "NYSE" means the New York Stock Exchange, Inc.

         "OFT" has the meaning set forth in Section 9.1(h)(i).

         "Orders" shall have the meaning set forth in Section 4.4(a).

         "Parent" has the meaning set forth in the preamble hereto.

         "Parent Disclosure Documents" has the meaning set forth in Section 4.7.

         "Parent Disclosure Letter" has the meaning set forth in Section 5.2(c).

         "Parent  Financial  Statements"  has the  meaning  set forth in Section
5.5(a).

         "Parent Indemnitee" has the meaning set forth in Section 10.2(a).

         "Parent Indemnitors" has the meaning set forth in Section 10.2(b).

         "Parent's  Knowledge",  "Knowledge  of the  Parent"  means  the  actual
knowledge with respect to Parent,  Michael Bungey, Arthur D'Angelo and the Chief
Executive   Officer  and  Chief  Financial  Officer  of  each  of  the  Material
Subsidiaries.

         "Parent Material Adverse Effect" means any condition,  change or effect
that is materially adverse to the business,  operations or condition  (financial
or otherwise) of Parent and its Subsidiaries taken as a whole.

         "Parent  Materiality  Terms"  has the  meaning  set  forth  in  Section
10.2(c).

         "Parent Permits" has the meaning set forth in Section 5.9.

         "Parent SEC Report" means the most recent Form 20-F filed by Parent.

         "Parent Share Rights" has the meaning set forth in Section 2.8(a)(ii).

         "Parent  Share  Value"  means the  product  of (x) the  average  of the
closing middle market  quotation of a Parent Share on the LSE as reported in the
Daily  Official  List of the LSE for  each of the 10  consecutive  Trading  Days
ending one Trading Day immediately  preceding the date hereof  multiplied by (y)
the Exchange Rate.

         "Parent  Shareholders'  Approval"  has the meaning set forth in Section
7.3(a).

         "Parent  Shareholders'  Meeting"  has the  meaning set forth in Section
7.3(a).

         "Parent Shares" means ordinary  voting shares,  with a nominal value of
UK fifty pence each, of Parent.

         "Permitted  Liens"  means (i) Liens  reserved  against  in the  Company
Financial Statements, to the extent so reserved and specifically disclosed, (ii)
Liens for Taxes not yet due and payable,  (iii)  immaterial Liens and (iv) Liens
under the Credit Agreement.

         "Person" means any individual, partnership, joint venture, corporation,
limited liability company, limited liability partnership,  trust, unincorporated
organization, group or government or other department or agency thereof.

         "Post-Closing  Period" means any taxable year (other than a Pre-Closing
Period).

         "(pound)" means United Kingdom pounds sterling.

         "Pre-Acquisition Breach" has the meaning set forth in Section 10.2(a).

         "Pre-Closing  Period"  shall  have the  meaning  specified  in  Section
4.17(b).

         "Preferred  Election"  means the election by any  Contingent  Holder to
retain the contingent  right to receive shares of 6% Preferred Stock (or cash in
lieu  thereof)  or,  in  connection  with the  Connect  Agreement,  shares of 6%
Preferred  Stock and the Class B Common Stock (or in either  case,  cash in lieu
therof) in accordance with the terms of the relevant Acquisition Agreement.

         "Prior Ownership Allocation" means the proportional ownership interests
in the  Company  set forth in  Section  4.2(a)(iii)  of the  Company  Disclosure
Letter.

         "Prospectus" has the meaning set forth in Section 7.14(h).

         "Registered Securities" has the meaning set forth in Section 7.14(a).

         "Returns" shall have the meaning specified in Section 4.17(a).

         "SEC" means the United States Securities and Exchange Commission.

         "SEC Reports" has the meaning set forth in Section 5.5.

         "Securities Act" means the U.S. Securities Act of 1933, as amended, and
the rules and regulations thereunder.

         "Shelf Registration" has the meaning set forth in Section 7.14(a).

         "6%  Preferred  Stock" means the 6%  Convertible  Redeemable  Preferred
Stock, par value $0.01 per share, of the Company.

         "Skadden Arps" shall have the meaning specified in Section 9.3(c).

         "SOS" has the meaning set forth in Section 9.1(h)(i).

         "Standards" means the Admission and Disclosure  Standards  published by
the LSE.

         "Stock Option" has the meaning set forth in Section 2.8(a)(i).

         "Stockholders Agreement" has the meaning set forth in the fifth WHEREAS
clause.

         "Stockholder Indemnitees" has the meaning set forth in Section 10.2(b).

         "Stockholder Indemnitors" has the meaning set forth in Section 10.2(a).

         "Stockholder Indemnitors'  Representative" has the meaning set forth in
Section 10.3(a).

         "Stockholders" has the meaning set forth in Section 7.14(a).

         "Stop order" has the meaning set forth in Section 7.14(g).

         "Subsidiary"  of any  Person  means  (i) any  corporation  of which the
outstanding capital stock having at least a majority of the votes entitled to be
cast in the election of directors under ordinary circumstances shall at the time
be owned,  directly or  indirectly,  by such Person or (ii) any other  Person of
which at least a majority of the voting interest under ordinary circumstances is
at the time, directly or indirectly, owned by such Person.

         "Surviving Corporation" has the meaning set forth in Section 2.1.

         "Takeover Proposal" has the meaning set forth in Section 6.2(a).

         "Tax Threshold" has the meaning set forth in Section 10.5.

         "Taxes"  shall mean all taxes,  assessments,  duties,  fees,  levies or
other  charges  imposed  by  any  governmental  authority,   including,  without
limitation,  all Federal,  state,  local,  foreign and other income,  franchise,
profits,  capital  gains,  capital  stock,  transfer,  sales,  use,  occupation,
property, value added, inheritance,  estate, excise, social security, severance,
windfall  profits,  stamp,  license,  payroll,   withholding  and  other  taxes,
assessments,  charges, duties, fees, levies or other governmental charges of any
kind whatsoever  (whether  payable directly or by withholding and whether or not
requiring the filing of a Return), all estimated taxes,  deficiency assessments,
additions to tax, penalties and interest.

         "Termination   Date"  shall  have  the  meaning  specified  in  Section
11.1(b)(i).

         "Trading  Day" shall mean any day on which Parent  Shares are traded on
the LSE.

         "Treasury  Regulations"  shall mean the temporary and final regulations
promulgated pursuant to the Code.


         "Unaudited  Financial  Statements" has the meaning set forth in Section
4.5(a).

         "U.S.  GAAP" means  generally  accepted  accounting  principles  of the
United States applied on a consistent basis by the Company.

         "UKLA"  or  "UK  Listing   Authority"  means  the  Financial   Services
Authority, as the competent authority for listing in the United Kingdom pursuant
to the FS Act;

         "UK GAAP" means generally accepted accounting  principles in the United
Kingdom applied on a consistent basis by Parent.

         "UK  Subsidiary"  means  any  Subsidiary  of the  Company  that  (i) is
incorporated  in the United  Kingdom or (ii) carries on any trade or business in
the United Kingdom.

         "VEBAs" has the meaning set forth in Section 4.15(a).

         "Violation" has the meaning set forth in Section 7.14(h).

         "Voting Debt" has the meaning set forth in Section 4.2(a).


                                   ARTICLE II

                                   THE MERGER

         Section  2.1 The Merger.  Upon the terms and subject to the  conditions
set forth in this Agreement,  at the Effective Time,  Merger Sub shall be merged
with and into the Company in accordance with the DGCL. Following the Merger, the
separate  existence  of Merger Sub shall  cease,  and the  Company  shall be the
surviving corporation in the Merger (the "Surviving Corporation"), shall succeed
to and assume all rights and  obligations of Merger Sub and shall continue to be
governed by the laws of the State of Delaware  with all its rights,  privileges,
immunities,  powers and franchises  and shall continue  unaffected by the Merger
except as set forth in this Article II.

         Section  2.2  Effective  Time.  As soon as  practicable  following  the
satisfaction  or waiver of the  conditions  set forth in Article IX, the Company
and Merger Sub will cause a certificate of merger (the  "Certificate of Merger")
to be executed  and filed with the  Secretary  of State of the State of Delaware
and  make  all  other  filings  or  recordings  required  by  applicable  law in
connection  with the Merger.  The Merger shall become  effective at such time as
the Certificate of Merger is duly filed with the Secretary of State of the State
of Delaware or at such later time as is specified in the  Certificate  of Merger
in accordance with the DGCL (the "Effective Time").

         Section 2.3 Effects of the  Merger.  The Merger  shall have the effects
set forth in the applicable provisions of the DGCL.

         Section 2.4 Exchange Ratio. Except as provided in clause (a) and (b) of
Section 2.5, at the  Effective  Time,  each share of Company  Stock  outstanding
immediately  prior to the  Effective  Time shall,  in  accordance  with  Section
2.5(c),  be  converted  into and shall be canceled in exchange  for the right to
receive from Parent,  a number of Parent  Shares  determined  as set forth below
(the "Merger Consideration"):

         (a) for each holder of 8% Preferred Stock, a number of Parent Shares as
set  forth  opposite  such  holder's  name  in  Section  2.4(a)  of the  Company
Disclosure Letter; and

         (b) for each  share  of  Company  Common  Stock  outstanding  as of the
Effective Time, 5.2115 Parent Shares (the "Common Stock Exchange Ratio").

         The maximum number of Parent Shares issued pursuant to this Section 2.4
shall not  exceed  74,999,965  plus  such  number  of  Parent  Shares  issued in
connection with any Stock Options exercised after the date hereof.

         Section 2.5 Conversion and Exchange of Company Stock.  At the Effective
Time:

         (a)  Cancellation of Treasury Stock.  All shares of Company Stock owned
by the Company as treasury stock  immediately prior to the Effective Time shall,
by  virtue of the  Merger,  and  without  any  action on the part of the  holder
thereof, no longer be outstanding, shall be canceled and retired without payment
of any consideration therefor and shall cease to exist.

         (b) Capital  Stock of Merger Sub.  Each share of common stock of Merger
Sub outstanding  immediately  prior to the Effective Time shall be canceled and,
in consideration of the issuance of Parent Shares as provided by Section 2.4(c),
the Surviving  Corporation shall issue to Parent such number of shares of common
stock of the Surviving  Corporation as shall be agreed between Parent and Merger
Sub prior to the Effective  Time to have an aggregate  value equal to the Parent
Shares to be issued in the Merger.

         (c) Conversion of Company  Stock.  (i) Except as provided in clause (a)
of this Section 2.5, the shares of 8% Preferred  Stock held by each holder of 8%
Preferred  Stock  outstanding  immediately  prior to the Effective Time shall be
converted  into, and shall be canceled in exchange for the right to receive from
Parent  pursuant  to  Section  2.5(d),  a number of  Parent  Shares as set forth
opposite such holder's name in Section 2.4(a) of the Company  Disclosure Letter.
At the  Effective  Time,  all shares of 8%  Preferred  Stock  shall no longer be
outstanding,  shall be canceled  and retired and shall cease to exist,  and each
certificate (an "8% Preferred Certificate") formerly representing any of such 8%
Preferred Stock shall thereafter  represent only the right to receive the number
of Parent Shares issuable pursuant to this Section 2.5(c) and the right, if any,
to receive  pursuant to Section 2.6(f) cash in lieu of fractional  Parent Shares
and any  dividend  or  distribution  pursuant  to Section  2.6(c),  in each case
without interest.

         (ii) Except as provided in clause (a) and (b) of this Section 2.5, each
share of Company  Common Stock  outstanding  immediately  prior to the Effective
Time shall be converted into, and shall be canceled in exchange for the right to
receive from Parent pursuant to Section 2.5(d),  a number of Parent Shares equal
to the Common Stock Exchange  Ratio.  At the Effective  Time, all Company Common
Stock shall no longer be  outstanding,  shall be canceled  and retired and shall
cease to exist,  and each  certificate (a "Common Stock  Certificate")  formerly
representing  any of such Company Common Stock shall  thereafter  represent only
the right to  receive  the number of Parent  Shares  issuable  pursuant  to this
Section 2.5(c) and the right, if any, to receive pursuant to Section 2.6(f) cash
in lieu of fractional Parent Shares and any dividend or distribution pursuant to
Section 2.6(c), in each case without interest.  The 8% Preferred Certificate and
the  Common  Stock  Certificate  are each  sometimes  referred  to  herein  as a
"Certificate".

         (d)  In   consideration  of  the  issue  to  Parent  by  the  Surviving
Corporation of shares of common stock of the Surviving  Corporation  pursuant to
Section  2.5(b),  Parent shall issue Parent Shares,  in accordance  with Section
2.6,  for  the  purpose  of  giving   effect  to  the  delivery  of  the  Merger
Consideration referred to in Section 2.5(c).

         (e) In the event that,  subsequent  to the date of this  Agreement  but
prior to the Effective Time, the Company changes the number of shares of Company
Stock (other than as a result of the exercising of outstanding  stock  options),
or Parent  changes  the number of Parent  Shares,  issued and  outstanding  as a
result of a stock split,  stock combination,  stock dividend,  recapitalization,
redenomination  of share  capital or other  similar  transaction,  each Exchange
Ratio and other items dependent thereon shall be appropriately adjusted.

         Section 2.6 Exchange of Certificates.  (a) Exchange Agent. Prior to the
Effective  Time,  Parent  shall  appoint The Bank of New York or a bank or trust
company reasonably  acceptable to the Company,  as exchange agent (the "Exchange
Agent") for the purposes of this Agreement.  At the Effective Time, Parent shall
allot to each holder of Company  Stock who  immediately  prior to the  Effective
Time has duly  surrendered  his  Certificate  or  Certificates  of Company Stock
beneficially owned by such holder and delivered a duly executed  Indemnification
Agreement  (as  defined  herein),  the  Parent  Shares to which  such  holder is
entitled  pursuant to Section  2.5(c)  above.  Promptly  following the Effective
Time,  Parent shall issue the Parent Shares so allotted and procure the delivery
to such  holders of a  certificate  or  certificates  representing  such  Parent
Shares,  together with the consideration  listed in items (B) and (C) of Section
2.6(b)(ii) (such consideration being referred to herein as the "Exchange Fund").
If any  Certificate has not been duly  surrendered  prior to the Effective Time,
the  Parent  shall  promptly  after due  surrender  thereof  (together  with the
delivery of a duly executed Indemnification  Agreement) at any later time, allot
and issue to the holders of such  Certificates  the Parent  Shares to which they
are entitled  pursuant to Section 2.5(c) and deliver or procure delivery to them
of   certificates   in  respect  of  such  Parent  Shares,   together  with  the
consideration listed in items (B) and (C) of Section 2.6(b)(ii).

         (b) Exchange  Procedures.  (i) As soon as reasonably  practicable after
the Effective Time, or at such other time as mutually agreed upon between Parent
and the Company, Parent shall cause the Exchange Agent to mail to each holder of
record of a Certificate  immediately prior to the Effective Time whose shares of
Company  Stock will be  converted  pursuant to this Article II into the right to
receive  the  Merger  Consideration  (x) a letter of  transmittal  (which  shall
specify  that  delivery  shall be  effected,  and risk of loss and  title to the
Certificates  shall  pass,  only upon due  delivery of the  Certificates  to the
Exchange  Agent and shall be in such form and have such other  provisions as the
Company  and  Parent  may  mutually  agree  on) (the  "Letter  of  Transmittal")
providing  instructions  for use in effecting the surrender of  Certificates  in
exchange for  certificates  representing  the Parent  Shares and cash in lieu of
fractional  Parent  Shares and (y) an  agreement to be executed by the holder of
record  of  such   Certificate  (or  such  other  Person  receiving  the  Merger
Consideration  in exchange  for such  Certificate,  as provided for in the third
sentence of Section  2.6(b)(ii))  in the form of Exhibit 2 attached  hereto (the
"Indemnification  Agreement"). The parties hereto agree that no Person otherwise
entitled  to  receive  the  Merger  Consideration  shall  be  given  the  Merger
Consideration  unless and until such  Person  delivers to the  Exchange  Agent a
validly  executed  Indemnification  Agreement.  Notwithstanding  anything to the
contrary  contained  herein,  each of the parties agrees to use its commercially
reasonable  efforts to effect the surrender of the Certificates and the issuance
of the  Parent  Shares,  in  accordance  with the terms and  conditions  of this
Agreement, at the Effective Time.

         (ii) Upon surrender of a Certificate  for  cancellation to the Exchange
Agent,   together  with  the  Letter  of  Transmittal  and  the  Indemnification
Agreement,  each duly executed and completed in accordance  with its terms,  the
holder of such Certificate shall be entitled to receive in exchange therefor (A)
a certificate or certificates  (if the Company Stock is represented by more than
one  Certificate  and the holder of such Company  Stock desires to receive a new
certificate for each Certificate so surrendered)  representing that whole number
of Parent Shares (or,  subject to compliance with  applicable  procedures in the
United  Kingdom,  Parent  Shares  in  uncertificated  form),  (B) the  amount of
dividends  or other  distributions,  if any,  with a record date on or after the
Effective  Time which  theretofore  became  payable  with respect to such Parent
Shares,  and (C) the cash amount payable in lieu of fractional  Parent Shares in
accordance with Section 2.6(f),  in each case which such holder has the right to
receive  pursuant to the  provisions of this Article II, and the  Certificate so
surrendered  shall  forthwith be  canceled.  In no event shall the holder of any
Certificate  be entitled to receive  interest on any funds to be received in the
Merger.  In the event of a transfer of ownership  of Company  Stock which is not
registered in the transfer records of the Company, a certificate or certificates
representing that whole number of Parent Shares, plus the cash amount payable in
lieu of  fractional  Parent  Shares in  accordance  with Section  2.6(f) and any
dividends or other  distributions,  if any, may be issued to a transferee if the
Certificate  representing such Company Common Stock is presented to the Exchange
Agent accompanied by all documents required to evidence and effect such transfer
and by evidence that any applicable  stock transfer taxes have been paid.  Until
surrendered  as  contemplated  by this  Section  2.6(b)  and  subject to Section
2.6(c),  each  Certificate  shall,  after the Effective Time,  represent for all
purposes  only the right to receive the  consideration  listed in items (A), (B)
and (C) of this Section 2.6(b)(ii) as contemplated by this Article II.

         (c) Distributions  With Respect To Unexchanged  Shares. No dividends or
other distributions declared, made or paid after the Effective Time with respect
to Parent Shares with a record date on or after the Effective Time shall be paid
to the holder of any unsurrendered Certificate with respect to the Parent Shares
represented  thereby and no cash  payment in lieu of  fractional  Parent  Shares
shall be paid to any such holder  pursuant to Section 2.6(f) until the holder of
record of such  Certificate  shall surrender such Certificate in accordance with
this Section.  Subject to the effect of applicable laws,  following surrender of
any  such  Certificate,  there  shall  be  paid  to  the  record  holder  of the
certificates  representing  Parent Shares issued in exchange  therefor,  without
interest,  (i) at the time of such  surrender,  the amount of dividends or other
distributions,  if any, with a record date on or after the Effective  Time which
theretofore became payable, but which were not paid by reason of the immediately
preceding  sentence,  with  respect  to  such  Parent  Shares  and  (ii)  at the
appropriate  payment date, the amount of dividends or other distributions with a
record date on or after the Effective  Time but prior to surrender and a payment
date  subsequent  to  surrender  payable  with  respect to such  Parent  Shares.
(d)......No  Further  Ownership  Rights In  Company  Stock.  All  Parent  Shares
delivered upon the surrender for exchange of Certificates in accordance with the
terms  hereof  (including  any cash paid  pursuant to Section  2.6(f) or 2.6(c))
shall be deemed to have been issued at the Effective  Time in full  satisfaction
of all rights  pertaining to the Company  Stock  represented  thereby.  From and
after the  Effective  Time,  the stock  transfer  books of the Company  shall be
closed and there shall be no further  registration  of transfers  thereon of the
shares  of  Company  Stock  which  were  outstanding  immediately  prior  to the
Effective Time. If, after the Effective Time,  Certificates are presented to the
Surviving  Corporation  for any reason,  they shall be canceled and exchanged as
provided in this Section.

         (e) Dissenting Stock. Notwithstanding anything in this Agreement to the
contrary, those shares of Company Stock which immediately prior to the Effective
Time are  Dissenting  Stock shall not be converted into the right to receive the
Merger  Consideration  as provided in Section 2.4(c) hereof,  but the holders of
Dissenting  Stock shall be entitled to receive  such  consideration  as shall be
determined pursuant to Section 262 of the DGCL from the Company or the Surviving
Corporation;  provided,  however,  that, if any such holder shall have failed to
perfect  or  shall  withdraw  (with  the  written   approval  of  the  Surviving
Corporation,  if such  withdrawal  is not  tendered  within  60 days  after  the
Effective  Time) or lose his right to appraisal and payment in  accordance  with
the DGCL,  such holder's shares shall thereupon be deemed to have been converted
as of the  Effective  Time into the right to receive  the Merger  Consideration,
without any  interest  thereon,  and such shares  shall no longer be  Dissenting
Stock.  The Company (and after the Effective  Time,  the Surviving  Corporation)
shall give  Parent (A)  prompt  notice of any  written  demands  for  appraisal,
withdrawals of demands for appraisal and any other related instruments  received
by the  Company or the  Surviving  Corporation,  as the case may be, and (B) the
opportunity to direct all  negotiations  and proceedings with respect to demands
for  appraisal.  The Company  (and,  after the  Effective  Time,  the  Surviving
Corporation)  will not voluntarily  make any payment with respect to any demands
for appraisals and will not, without the prior written consent of Parent, settle
or offer to settle  any such  demand,  provided  however,  that  notwithstanding
anything herein to the contrary, Parent or any of its Affiliates (other than the
Surviving   Corporation)   shall  not  provide  any  funds  (via  loan,  capital
contributions,  or otherwise), solely for the purpose of making the Company's or
the Surviving  Corporation's  payments of consideration to holders of Dissenting
Stock.

         (f)  No  Fractional   Shares.  No  certificate  or  scrip  representing
fractional  Parent  Shares will be issued in the Merger upon the  surrender  for
exchange of  Certificates,  and such fractional  Parent Share interests will not
entitle the owner thereof to vote or to any rights of a holder of Parent Shares.
In lieu of any such fractional  Parent Share,  each holder of  Certificates  who
would  otherwise  have been entitled to a fraction of a Parent Share in exchange
for such  Certificates  pursuant to this Section shall receive from the Exchange
Agent a cash payment in United States currency in lieu of such fractional Parent
Share  determined by multiplying (A) Parent Share Value times (B) the fractional
Parent Share interest to which such holder would otherwise be entitled.

         (g)  Termination  Of Exchange  Fund.  Any portion of the Exchange  Fund
which  remains  undistributed  to the  stockholders  of the Company for one year
after the  Effective  Time shall be delivered to or as directed by Parent,  upon
demand,  and any holders of Certificates who have not theretofore  complied with
this  Article II shall  thereafter  look only to Parent  (subject  to  abandoned
property,  escheat and other similar  laws) as general  creditors for payment of
their claim for Parent Shares,  any cash in lieu of fractional Parent Shares and
any dividends or distributions with respect to Parent Shares. Neither Parent nor
the Surviving  Corporation  shall be liable to any holder of any Certificate for
Parent  Shares (or dividends or  distributions  with respect  thereto),  or cash
payable in respect of fractional  Parent Shares,  delivered to a public official
pursuant to any  applicable  abandoned  property,  escheat or similar  law.  Any
amounts  remaining  unclaimed  by holders of Parent  Shares five years after the
Effective  Time (or such  earlier  date  immediately  prior to such time as such
amounts  would  otherwise  escheat  to or become  property  of any  governmental
entity) shall, to the extent permitted by applicable law, become the property of
the Surviving Corporation free and clear of any claims or interest of any Person
previously entitled thereto.

         (h) Lost,  Stolen or Destroyed  Certificates.  If any Certificate shall
have been lost,  stolen or  destroyed,  upon the making of an  affidavit of that
fact by the Person  claiming such  Certificate  to be lost,  stolen or destroyed
and, if required by Parent,  the posting by such Person of a bond in such amount
as Parent may reasonably  direct as indemnity against any claim that may be made
against it with respect to such Certificate,  the Exchange Agent will deliver in
exchange for such lost,  stolen or destroyed  Certificate the applicable  Merger
Consideration  with respect to the shares of Company Stock formerly  represented
thereby,  any cash in lieu of fractional Parent Shares, and unpaid dividends and
distributions  in respect of or Parent Shares  deliverable  in respect  thereof,
pursuant to this Agreement.

         Section 2.7 Withholding Rights.  Each of the Surviving  Corporation and
Parent shall be entitled to deduct and withhold from the consideration otherwise
payable pursuant to this Agreement to any holder of shares of Company Stock such
amounts as it is required to deduct and  withhold  with respect to the making of
such payment  under the Code,  or any  provision of state,  local or foreign tax
law. To the extent that amounts are so withheld by the Surviving  Corporation or
Parent,  as the case may be,  such  withheld  amounts  shall be treated  for all
purposes  of this  Agreement  as having been paid to the holder of the shares of
Company Stock in respect of which such deduction and withholding was made by the
Surviving  Corporation  or Parent,  as the case may be. The  parties  agree that
there is no withholding tax under UK tax law.

         Section  2.8  Company  Stock  Options;  Other  Stock-Based  Plans.  (a)
Immediately  prior to the Effective  Time, the board of directors of the Company
(or the  appropriate  committee  thereof)  shall have adopted such  resolutions,
taken such  actions and obtained  any  necessary  consents as may be required to
effect the following:

         (i) adjust or implement, as may be applicable or appropriate, the terms
    of all  outstanding  and  unexercised  stock  options to purchase  shares of
    Company  Common Stock  heretofore  granted under the Company Stock Plans (as
    defined in  Section  4.2(a))  or under the  agreements  set forth in Section
    2.8(a)(i) of the Company  Disclosure Letter (each, a "Stock Option") and the
    terms of the  Company  Stock Plans and the  agreements  set forth in Section
    2.8(a)(i) of the Company  Disclosure Letter to provide that at the Effective
    Time, each Stock Option outstanding and unexercised immediately prior to the
    Effective  Time shall be deemed to constitute  an option to acquire,  on the
    same terms and conditions as were applicable under such Stock Option, Parent
    Shares  where (x) the number of Parent  Shares  which may be  acquired  upon
    exercise of each such Stock Option shall be equal to the number of shares of
    Company  Common  Stock  that  were  purchasable   under  such  Stock  Option
    immediately  prior to the  Effective  Time  multiplied  by the Common  Stock
    Exchange  Ratio,  subject to adjustment as provided in Section  2.5(e),  and
    rounding up to the nearest  whole  Parent Share and (y) the per Parent Share
    exercise  price under each such Stock  Option  shall be obtained by dividing
    the per share  exercise  price of each such Stock Option by the Common Stock
    Exchange  Ratio and dividing  such result by the Exchange  Rate,  subject to
    adjustment as provided in Section  2.5(e),  and rounding down to the nearest
    penny.  Notwithstanding  the  foregoing,  in the case of any Stock Option to
    which Section 421 of the Code applies by reason of its  qualification  under
    Section 422 of the Code ("qualified  stock options"),  the option price, the
    number of shares which may be acquired pursuant to such Stock Option and the
    terms and conditions of exercise of such Stock Option shall be determined in
    order to comply with Section 424(a) of the Code.  Accordingly,  with respect
    to any qualified stock options, the per Parent Share exercise price shall be
    rounded up to the nearest pence and the number of Parent Shares which may be
    purchasable shall be rounded down to the nearest Parent Share;

         (ii) except with  respect to rights to any Issuance  Obligation  of the
    Company and/or its Subsidiaries under any Acquisition  Agreement,  adjust or
    implement, as may be applicable or appropriate, the terms of all outstanding
    stock units,  deferred  stock awards,  stock  appreciation  rights and other
    rights to acquire  Company  Common  Stock,  restricted  stock,  or any other
    interest in respect of Company  Common  Stock under any Company  Stock Plan,
    program, arrangement or agreement specified in Section 2.8(a) of the Company
    Disclosure  Letter,  other than Stock Options  ("Company Stock Rights"),  to
    provide  that,  at the  Effective  Time,  (x) each holder of a Company Stock
    Right  shall be  entitled  to that  number of stock  units,  deferred  stock
    awards, stock appreciation rights or other corresponding  rights,  including
    restricted  shares,  as the case  may be,  with  respect  to  Parent  Shares
    ("Parent  Share  Rights")  equal to the number of  applicable  Company Stock
    Rights held by such holder  immediately  prior to the Closing  multiplied by
    the Common Stock  Exchange  Ratio,  on the same terms and conditions as were
    applicable  under such Company Stock Right,  as adjusted in accordance  with
    this Section 2.8,  subject to adjustment as provided in Section 2.5(e),  and
    rounding up to the nearest  whole Parent  Share,  and (y) the share value on
    the grant date with respect to each Parent Share Right shall be equal to the
    share value on the grant date of the corresponding Company Stock Right as in
    effect  immediately prior to the Effective Time, divided by the Common Stock
    Exchange  Ratio and dividing  such result by the Exchange  Rate,  subject to
    adjustment as provided in Section  2.5(e),  and rounding down to the nearest
    penny; and

         (iii) make such other  changes to the Company Stock Plans and any other
    plan, program,  arrangement or agreement providing for the issuance or grant
    of any other interest in respect of, or payment  determined by reference to,
    the capital stock of the Company or any of its  subsidiaries  as appropriate
    to give effect to the Merger, subject to approval by Parent.

         (b) As of the Effective Time, Parent agrees to assume all Stock Options
and Company Stock Rights in accordance with the terms hereof.  If applicable and
as soon as  practicable  after the Effective  Time,  Parent shall deliver to the
holders of Stock Options and Company Stock Rights  appropriate  notices  setting
forth such  holders'  rights  pursuant  to the  applicable  Company  Stock Plan,
program,  arrangement or agreement,  and the agreements evidencing the grants of
such Stock Options and Company Stock Rights shall continue in effect on the same
terms and conditions  (subject to the  adjustments  required by this Section 2.8
after  giving  effect to the Merger).  After the  Effective  Time,  Parent shall
comply with the terms of the Company Stock Plans and the agreements set forth in
Section  2.8(a)(i) of the Company  Disclosure  Letter, as adjusted in accordance
with Section 2.5(e). Parent shall take all corporate action necessary to reserve
for issuance a sufficient  number of Parent Shares for delivery upon exercise of
Stock Options assumed by it in accordance with this Section 2.8.  Simultaneously
with the Closing, Parent shall file a registration statement on Form S-8 (or any
successor  or other  appropriate  forms),  which  shall  cover all of the Parent
Shares to be issued  upon the  exercise  of Stock  Options  assumed by Parent in
accordance  with  this  Section  2.8 and  shall use its  reasonable  efforts  to
maintain  the  effectiveness  of such  registration  statement  or  registration
statements  (and maintain the current status of the  prospectus or  prospectuses
contained therein) for so long as such options remain outstanding.

         (c) Except as set forth in  Section  2.8(c) of the  Company  Disclosure
Letter,  the Company agrees that, on or after the date hereof, it will not grant
any stock options, stock appreciation rights, stock units, deferred stock awards
or other rights to acquire Company Common Stock or any other interest in Company
Common Stock and will not take any action to accelerate  the  exercisability  of
Stock Options or Company Stock Rights, and/or permit cash payments to holders of
Stock  Options or Company  Stock  Rights with  respect to such Stock  Options or
Company Stock Rights.

         Section 2.9 Conversion/Preferred  Election;  Procedure. (a) The Company
shall deliver to Parent,  not less than five days prior to the  Effective  Time,
each  election  notice  validly  executed  and  delivered to the Company by each
Contingent  Holder,  in a form mutually agreed upon by the parties hereto within
10  business  days of the date  hereof (an  "Election  Notice")  indicating  the
election  by such  Contingent  Holder of either the  Conversion  Election or the
Preferred  Election.  Any  Contingent  Holder who has not  submitted an Election
Notice shall continue to have the right to receive shares of 6% Preferred  Stock
(including any rights to cash in lieu thereof to the extent provided for in such
Acquisition  Agreement) or, in the case of the Connect  Agreement,  shares of 6%
Preferred  Stock  and  Class B Common  Stock in  accordance  with the  terms and
conditions of the  applicable  Acquisition  Agreement.  In  connection  with the
Conversion  Election,  each share of 6% Preferred  Stock shall be converted into
and shall be exchanged for the right to receive from Parent,  a number of Parent
Shares determined by dividing $1,000.00 by the Parent Share Value. In connection
with  the  Connect  Agreement,  each  share of  Class B  Common  Stock  shall be
converted  into and  exchanged  for the right to receive from Parent a number of
Parent Shares equal to the Common Stock Exchange  Ratio. No certificate or scrip
representing  fractional Parent Shares will be issued to the Contingent Holders.
In lieu of any such fractional  Parent Share,  each Contingent  Holder who would
otherwise  have been  entitled to a fraction of a Parent Share shall be entitled
to receive a cash payment in United States  currency in lieu of such  fractional
Parent  Share  determined  by  multiplying  (A) Parent Share Value times (B) the
fractional Parent Share interest to which such Contingent Holder would otherwise
be entitled.

         (b)  Parent  expressly  guarantees,  as  of  the  Effective  Time,  the
contingent  payment  obligations  of the Company  set forth in each  Acquisition
Agreement  (each,  a  "Contingent  Payment" and  collectively,  the  "Contingent
Payments")  in  accordance  with the terms and  conditions  of such  Acquisition
Agreement,  if and when such payment becomes due. Parent agrees that the form of
payment,  if any, under each  Acquisition  Agreement shall be made in accordance
with the Election  Notice or, absent the  submission of an Election  Notice,  in
accordance  with the applicable  Acquisition  Agreement.  The parties agree that
each Contingent  Holder is an intended third party beneficiary of this Agreement
(only for  purposes  of  enforcing  the  obligations  assumed  by Parent in this
Section 2.9). Parent or any of its Affiliates (other than Surviving Corporation)
shall not provide funding (via loan, capital contributions or otherwise), solely
for the purpose of making the Company's or the Surviving  Corporation's  in-kind
payments (but  excluding  in-kind  payments of Parent  Shares) of the Contingent
Payments.

         Section  2.10  The  Surviving  Corporation.   (a)  The  certificate  of
incorporation of the Company,  as in effect  immediately  prior to the Effective
Time shall be the  Certificate  of  Incorporation  of the Surviving  Corporation
until thereafter changed or amended as provided therein or by applicable Law.

         (b) The  bylaws of the  Company as in effect  immediately  prior to the
Effective Time, shall be the bylaws of the Surviving  Corporation  until amended
in accordance  therewith or with the Certificate of Incorporation and applicable
Law.

         (c) From and  after  the  Effective  Time,  until  successors  are duly
elected or appointed and qualified in accordance  with  applicable  Law, (i) the
directors  of Merger Sub at the  Effective  Time shall be the  directors  of the
Surviving Corporation, and (ii) the officers of Merger Sub at the Effective Time
shall be the officers of the Surviving Corporation.


                                   ARTICLE III

                                   THE CLOSING

         Section 3.1 Closing.  The closing of the Merger (the  "Closing")  shall
take place (i) at the offices of White & Case LLP,  1155 Avenue of the Americas,
New York, New York 10036 at 10:00 a.m. (New York time) on the third business day
after the day on which the last of the conditions set forth in Article IX (other
than those  conditions  that by their nature are to be fulfilled at the Closing,
but subject to the fulfillment or waiver of such conditions)  shall be fulfilled
or waived in accordance with this Agreement or (ii) at such other place and time
and/or on such other date as the  Company  and Parent may agree in writing  (the
"Closing Date").


                                   ARTICLE IV

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

         The  Company  represents  and  warrants  to Parent  and  Merger  Sub as
follows:

         Section 4.1  Organization,  Standing and Power.  Except as disclosed in
Section  4.1 of the  Company  Disclosure  Letter,  the  Company  and each of its
Subsidiaries  is a  corporation  duly  organized,  validly  existing and in good
standing  (with  respect to  jurisdictions  which  recognize the concept of good
standing) under the laws of the jurisdiction in which it is incorporated and has
the  requisite  corporate  power and  authority  to own,  lease and  operate its
properties and to carry on its business as now being  conducted  except for such
failures to be in good standing or to have such power and authority, which could
not be  reasonably  be expected to,  individually  or in the  aggregate,  have a
Company  Material  Adverse  Effect.  Except as  disclosed  in Section 4.1 of the
Company  Disclosure  Letter,  the Company and each of its  Subsidiaries  is duly
qualified to do business, and is in good standing (with respect to jurisdictions
which recognize the concept of good standing),  in each  jurisdiction  where the
character  of its  properties  owned or held  under  lease or the  nature of its
activities makes such qualification necessary, except where the failure to be so
qualified could not reasonably be expected to, individually or in the aggregate,
have a Company Material  Adverse Effect.  No later than five business days prior
to the Closing,  the Company  will have made  available to Parent and Merger Sub
complete and correct copies of the certificate of  incorporation  and by-laws of
the Company and the comparable  governing documents of each of its Subsidiaries,
in each case as amended to the date of this  Agreement.  Other than as set forth
in Section 4.1 of the letter dated the date hereof and  delivered by the Company
to Parent and Merger Sub simultaneously  with the execution and delivery of this
Agreement (the "Company  Disclosure  Letter"),  the respective  certificates  of
incorporation and by-laws or other organizational  documents of the Subsidiaries
of the Company do not contain any  provision  limiting or otherwise  restricting
the ability of the Company to control such subsidiaries  which cannot be amended
by the Company without restriction.

         Section 4.2 Capital  Structure.  (a) As of the date of this  Agreement,
the  authorized  capital  stock of the Company  consists of (i) nine million two
hundred forty-eight thousand six hundred eighty-four (9,248,684) shares of Class
A Common Stock,  (ii) two million six hundred seventy- two thousand five hundred
and  fifteen  (2,672,515)  shares of Class B Common  Stock,  (iii)  one  hundred
fourteen thousand nine hundred twenty (114,920) shares of 8% Preferred Stock and
(iv) sixty-three  thousand (63,000) shares of 6% Preferred Stock. As of the date
of this Agreement,  (i) (a)  9,215,350.691  shares of Class A Common Stock,  (b)
1,094,015  shares  of Class B Common  Stock and (c)  104,066.58684  shares of 8%
Preferred Stock were issued and  outstanding,  all of which were validly issued,
fully paid and nonassessable and free of preemptive  rights,  (ii) 58,333 shares
of Class A Common  Stock  were held in the  treasury  of the  Company  or by its
Subsidiaries  and  (iii)  1,400,000  shares  of Class B Common  Stock  have been
granted as awards or reserved for future issuance pursuant to the Company's 2000
Stock  Incentive  Plan and 96,000  Class B Common  Stock were  granted as awards
pursuant to the Company's 1999 Stock Option Plan, as amended (collectively,  the
"Company Stock Plans").  No shares of 6% Preferred Stock are outstanding.  As of
the date of this Agreement,  except (i) as set forth above and (ii) as set forth
in Section  4.2(a)(i)  of the Company  Disclosure  Letter,  no shares of capital
stock or other  voting  securities  of the Company  were  issued,  reserved  for
issuance  or  outstanding.  The  Company  does not have any  outstanding  bonds,
debentures,  notes or other  obligations  the holders of which have the right to
vote (or which are  convertible  into or exercisable  for securities  having the
right to vote) with the  stockholders  of the  Company  on any  matter  ("Voting
Debt"). As of the date of this Agreement, except for stock options not in excess
of 1,500,000  shares of Company  Common Stock  granted  under the Company  Stock
Plans and as set  forth on the  Section  4.2(a)(ii)  to the  Company  Disclosure
Letter, there are no outstanding Issuance Obligations  obligating the Company or
any of its  Subsidiaries to issue or sell any Company Stock or any capital stock
of the  Company's  Subsidiaries  or to  grant,  extend  or  enter  into any such
Issuance  Obligation.  Section 4.2(a)(iii) of the Company Disclosure Letter sets
forth a true and  complete  list of the record  owners of  capital  stock of the
Company as of the date  hereof;  provided  Section  4.2(a)(iii)  of the  Company
Disclosure  Letter  shall be updated  as of the  Effective  Date to reflect  any
options exercised on or prior to the Effective Date.

         (b) Section 4.2(b) of the Company  Disclosure Letter sets forth (i) the
name and jurisdiction of  incorporation of each Subsidiary of the Company,  (ii)
its authorized  capital stock, (iii) the number of issued and outstanding shares
of its capital  stock and (iv) the record  owners of such shares.  Except as set
forth in Section 4.2(b) of the Company Disclosure Letter, all of the outstanding
capital stock of, or ownership  interests in, each  Subsidiary of the Company is
owned by the Company, directly or indirectly.  All of the issued and outstanding
shares of capital  stock of each  Subsidiary  held by the  Company  are  validly
existing,  fully paid and non-assessable.  Except as set forth in Section 4.2(b)
of the Company  Disclosure  Letter, no Subsidiary of the Company has outstanding
Voting Debt and no Subsidiary of the Company is bound by,  obligated  under,  or
party to an Issuance  Obligation  with respect to any security of the Company or
any  Subsidiary  of the  Company.  Except as set forth in Section  4.2(b) of the
Company  Disclosure  Letter and for Liens (as  defined  below)  under the Credit
Agreement, all of such capital stock or ownership interest of each Subsidiary of
the Company is owned by the Company,  directly or indirectly,  free and clear of
all  security  interests,  liens,  claims,  pledges,  options,  rights  of first
refusal,  agreements,  charges or other  encumbrances of any nature or any other
limitation or  restriction  (including  any  restriction on the right to vote or
sell the same,  except as may be  provided  under  applicable  Federal  or State
securities laws) (collectively, "Liens").

         (c) Except for the Company's  interest in its Subsidiaries,  and except
as set forth in Section  4.2(c) of the Company  Disclosure  Letter,  the Company
does not directly or  indirectly  own any equity or similar  interest in, or any
interest  convertible  into or  exchangeable  or  exercisable  for any equity or
similar  interest  in, any  corporation,  partnership,  joint  venture,  limited
liability   company  or  other  business   association  or  entity  (other  than
non-controlling  investments  in the ordinary  course of business and  corporate
partnering,  development,  cooperative  marketing and similar  undertakings  and
arrangements entered into in the ordinary course of business).

         Section 4.3 Authority  Relative to this Agreement.  The Company has all
requisite  corporate  power and  authority  to enter into this  Agreement,  and,
subject  to  obtaining  the  Company  Stockholders'  Approval,  to  perform  its
obligations  hereunder and to consummate the transactions  contemplated  hereby.
The execution, delivery and performance of this Agreement by the Company and the
consummation by the Company of the  transactions  contemplated  hereby have been
duly and validly unanimously  approved by the Board of Directors of the Company,
the Board of Directors of the Company has  unanimously  recommended the approval
of this  Agreement by the  stockholders  of the Company and  directed  that this
Agreement  be  submitted   to  the   stockholders   of  the  Company  for  their
consideration,  and no other corporate proceedings on the part of the Company or
its  stockholders  are  necessary  to  authorize  the  execution,  delivery  and
performance of this Agreement by the Company and the consummation by the Company
of the  transactions  contemplated  hereby,  other than  obtaining  the  Company
Stockholders'  Approval.  This Agreement has been duly and validly  executed and
delivered by the Company and constitutes a legal,  valid and binding  obligation
of the Company  enforceable  against the Company in  accordance  with its terms,
except  as   enforceability   may  be   limited   by   bankruptcy,   insolvency,
reorganization,  moratorium or other similar laws  affecting the  enforcement of
creditors' rights generally and by general equitable  principles  (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

         Section 4.4  Non-Contravention;  Approvals and Consents.  (a) Except as
disclosed in Section 4.4(a) of the Company  Disclosure Letter, the execution and
delivery of this  Agreement by the Company does not, and the  performance by the
Company of its obligations  hereunder and the  consummation of the  transactions
contemplated hereby will not, conflict with, result in a violation or breach of,
constitute  (with or without  notice or lapse of time or both) a default  under,
result  in or  give  to any  Person  any  right  of  payment  or  reimbursement,
termination,  cancellation,  modification or  acceleration  of, or result in the
creation or  imposition  of any Lien upon any of the assets or properties of the
Company  or any of its  Subsidiaries  under,  any of the  terms,  conditions  or
provisions of (i) the  certificates or articles of  incorporation or by-laws (or
other comparable  charter  documents) of the Company or any of its Subsidiaries,
or (ii) subject to obtaining the Company  Stockholders'  Approval and the taking
of the  actions  described  in  Section  4.4(b),  (x) any  statute,  law,  rule,
regulation or ordinance  (together,  "Laws"),  or any judgment,  decree,  order,
writ,  permit  or  license  (together,   "Orders"),   of  any  court,  tribunal,
arbitrator,  authority, agency, commission, official or other instrumentality of
the United States, any foreign country or any domestic or foreign state, county,
city or other political  subdivision (a "Governmental or Regulatory  Authority")
applicable to the Company or any of its  Subsidiaries or any of their respective
assets or  properties,  or (y) any note,  bond,  mortgage,  security  agreement,
indenture,  license,  franchise,  permit,  concession,  contract, lease or other
instrument, obligation or agreement of any kind (together, "Contracts") to which
the Company or any of its Subsidiaries is a party or by which the Company or any
of its  Subsidiaries or any of their  respective  assets or properties is bound,
excluding  from  the  foregoing  clauses  (x) and  (y),  conflicts,  violations,
breaches,   defaults,   rights  of  payment  and  reimbursement,   terminations,
modifications,  accelerations  and  creations  and  impositions  of Liens which,
individually  or in the  aggregate,  could not  reasonably be expected to have a
Company Material  Adverse Effect or prevent,  materially  impair,  or materially
delay the ability of the Company to consummate the transactions  contemplated by
this Agreement.

         (b) Except (i) for the filing of a  pre-merger  notification  report by
the Company under the Hart-Scott-Rodino  Antitrust  Improvements Act of 1976, as
amended, and the rules and regulations  thereunder (the "HSR Act"), (ii) for the
filing of the  Certificate  of Merger  and other  appropriate  merger  documents
required by the DGCL with the Secretary of State and appropriate  documents with
the relevant  authorities of other states in which the Constituent  Corporations
are  qualified to do business,  and (iii) as disclosed in Section  4.4(b) of the
Company  Disclosure  Letter,  no consent,  approval or action of, filing with or
notice to any  Governmental  or Regulatory  Authority or other public or private
third party is  necessary  or  required  under any of the terms,  conditions  or
provisions of any law or order of any  Governmental  or Regulatory  Authority or
any  Contract to which the Company or any of its  Subsidiaries  is a party or by
which the Company or any of its Subsidiaries or any of their  respective  assets
or properties  is bound for the execution and delivery of this  Agreement by the
Company,  the  performance  by the Company of its  obligations  hereunder or the
consummation of the transactions  contemplated hereby, other than such consents,
approvals,  actions, filings and notices which the failure to make or obtain, as
the case may be,  individually  or in the  aggregate,  could not  reasonably  be
expected to have a Company Material Adverse Effect or prevent, materially impair
or materially  delay the ability of the Company to consummate  the  transactions
contemplated by this Agreement.

         Section  4.5  Financial  Statements.  (a) The  Company  has  heretofore
furnished Parent with (i) the audited consolidated balance sheets of the Company
as of December 31, 1998 and 1999, together with related  consolidated  statement
of  operations,  stockholders'  equity and cash flows for the twelve months then
ended (the "Audited Financial Statements"),  together with the reports of Arthur
Andersen LLP thereon (the audited  consolidated balance sheet as at December 31,
1999 (the  "Balance  Sheet  Date") is  hereinafter  referred to as the  "Balance
Sheet"), and (ii) the unaudited consolidated balance sheet as of April 30, 2000,
and the related  unaudited  consolidated  statement of  operations  for the four
months then ended (the "Unaudited  Financial  Statements" and, together with the
Audited Financial Statements,  the "Company Financial  Statements").  Except for
normal  year-end  adjustments  and for absence of footnotes  with respect to the
Unaudited  Financial  Statements  and as set forth on Section 4.5 of the Company
Disclosure  Letter,  the Company Financial  Statements,  including the footnotes
thereto (i) have been  prepared  in  accordance  with U.S.  GAAP and (ii) fairly
present, in all material respects, the financial position of the Company and its
Subsidiaries at the respective dates thereof,  and the results of the operations
and  cash  flows  of the  Company  and  its  consolidated  Subsidiaries  for the
respective periods indicated.

         Section 4.6 Absence of Certain Events. Since the Balance Sheet Date and
except as disclosed in Section 4.6 of the Company Disclosure Letter, the Company
and its  Subsidiaries  have operated  their  respective  businesses  only in the
ordinary  course  consistent  with past practices and there has not occurred (i)
any change, event, occurrence, transaction or development which could reasonably
be  expected  to,  individually  or in the  aggregate,  have a Company  Material
Adverse  Effect;  (ii)  any  material  change  by  the  Company  or  any  of its
Subsidiaries  in its  accounting  methods,  principles or  practices;  (iii) any
amendments or changes in the Certificate of  Incorporation  or by-laws (or other
comparable governing documents) of the Company or any of its Subsidiaries;  (iv)
any  revaluation  by the  Company  or any of its  Subsidiaries  of any of  their
respective  assets,  including,  without  limitation,   write-offs  of  accounts
receivable,  other  than  in the  ordinary  course  of  the  Company's  and  its
Subsidiaries'  businesses  consistent  with  past  practices;  (v)  any  damage,
destruction  or loss which,  individually  or in the  aggregate,  resulted in or
could  reasonably be expected to result in a Company  Material  Adverse  Effect;
(vi) any material transaction or entered into any material agreement outside the
ordinary course of business which could reasonably be expected to have a Company
Material  Adverse Effect;  (vii) any increase in the compensation of any officer
of the  Company or any of its  Subsidiaries  or any  general  salary or benefits
increase to the employees of the Company or any of its  Subsidiaries  other than
in the ordinary course of business; or (viii) any declaration,  setting aside or
payment of any  dividend  or other  distribution  with  respect to any shares of
capital stock of the Company, or any repurchase, redemption or other acquisition
by the Company or any of its  Subsidiaries of any outstanding  shares of capital
stock or other  securities  of, or other  ownership  interests  in, the Company.
Except as set forth in Section 4.6 of the Company Disclosure  Letter,  since the
Balance Sheet Date,  neither the Company nor any of its  Subsidiaries  has taken
any action  specified in clauses (a), (b), (d), (e), (f), (g), (l), (m) and (n),
of Section 6.1 of this Agreement.

         Section 4.7 Information  Supplied.  The  information  supplied or to be
supplied  by the  Company  for  inclusion  in any filing by Parent with the UKLA
and/or the LSE in respect of the Merger (including,  without limitation, a Class
1 circular  to be issued to  shareholders  of Parent (the  "Circular"),  and the
listing  particulars under Part IV of the FS Act relating to Parent Shares to be
issued in the Merger (the  "Listing  Particulars")  (which may be comprised in a
single document or two separate documents and which are collectively referred to
in this  Agreement,  together  (where the context allows) with any amendments or
supplements  thereto,  the "Parent Disclosure  Documents") will, at all relevant
times,  include all  information  relating  to the Company and its  Subsidiaries
which is within the  Knowledge  of the Company (or which it would be  reasonable
for them to obtain by making  inquiries),  which,  in each case,  is  reasonably
requested by Parent to enable the Parent  Disclosure  Documents  and the parties
hereto to comply in all material  respects with all United Kingdom statutory and
other  legal and  regulatory  provisions  (including,  without  limitation,  the
Companies Act, the FS Act and the rules and regulations made thereunder, and the
rules  and  requirements  of the UKLA  and the  LSE)  and all  such  information
contained in such documents will be  substantially  in accordance with the facts
and will not omit  anything  materially  likely  to  affect  the  import of such
information.

         Section 4.8 Books and  Records.  Except as set forth on Schedule 4.8 of
the Company  Disclosure  Letter,  the respective minute books of the Company and
its   Subsidiaries,   as   previously   made   available   to  Parent   and  its
representatives,  contain  reasonable  records of all  meetings of, and official
action  taken by  (including  action taken by written  consent)  the  respective
stockholders and Boards of Directors of the Company and each Subsidiary.  Except
as set forth in  Section  4.8 of the  Company  Disclosure  Letter,  neither  the
Company  nor any  Subsidiary  of the Company  has any of its  material  records,
systems, controls, data or information recorded, stored, maintained, operated or
otherwise  wholly or partly  dependent upon or held by any means  (including any
electronic,  mechanical or photographic  process,  whether  computerized or not)
which  (including  all means of access  thereto and therefrom) are not under the
exclusive ownership and control of the Company or such Subsidiary.

         Section 4.9 Title to  Properties;  Encumbrances.  Except for properties
and assets  reflected in the Balance Sheet or as disclosed in Section 4.9 of the
Company  Disclosure Letter, or acquired since the Balance Sheet Date, which have
been sold or otherwise  disposed of in the  ordinary  course of business and for
personal  properties and assets (tangible and intangible)  leased by the Company
or its  Subsidiaries,  the Company  and its  Subsidiaries  have good,  valid and
marketable  title to (a) all of their personal  properties and assets  (tangible
and intangible), including, without limitation, all of the properties and assets
reflected in the Balance Sheet,  except as indicated in the notes  thereto,  and
(b) all of the personal  properties and assets  purchased by the Company and its
Subsidiaries  since the Balance  Sheet Date;  in each case free and clear of all
Liens other than Permitted  Liens. All of the tangible  personal  property owned
by, and material to, the Company and its Subsidiaries and used in their business
is in good operating condition and repair, ordinary wear and tear excepted, and,
in the  aggregate,  is adequate  and  suitable  for the purposes for which it is
presently being used.  Neither the Company nor any of its Subsidiaries  owns any
real property.

         Section  4.10  Leases.  (a) Section  4.10(a) of the Company  Disclosure
Letter  contains an accurate and complete list of all (i) real  property  leases
and (ii) leases to which the Company or any  Subsidiary is a party  requiring an
annual aggregate payment of at least $120,000. The Company has made available to
Parent and its counsel  true and complete  copies of each such lease  (including
all  amendments).  Each  lease  set  forth in  Section  4.10(a)  of the  Company
Disclosure  Letter which has not expired (or required to be set forth in Section
4.10(a) of the Company Disclosure Letter) is in full force and effect; and there
exists no event of default or event, occurrence, condition or act (including the
consummation of the transactions contemplated by this Agreement) which, with the
giving of notice,  the lapse of time or the  happening  of any further  event or
condition, would become a default under such lease on the part of the Company or
its Subsidiary party thereto,  which cannot be cured without the payment of cash
or, to the  Knowledge of the  Company,  any other party  thereto.  Except as set
forth on Section 4.10(a) of the Company Disclosure Letter, the real and personal
properties  subject to each lease set forth in  Section  4.10(a) of the  Company
Disclosure  Letter is in a state of good  maintenance and repair,  ordinary wear
and tear excepted, and are adequate and suitable for the purposes for which they
are presently being used.

         (b) Except as  disclosed in Section  4.10(b) of the Company  Disclosure
Letter,  neither  the  Company  nor any of its  Subsidiaries  has any  actual or
contingent  liabilities  in  respect  of  leasehold  properties  in  the  UK not
currently  occupied  by the  Company or any  Subsidiary  in an amount  exceeding
(pound)50,000 in aggregate.

         Section  4.11  Material  Contracts.  (a) Except as set forth on Section
4.11 of the  Company  Disclosure  Letter,  neither  the  Company  nor any of its
Subsidiaries is a party to or bound by:

         (i) any agreement, contract or commitment relating to the employment of
    any Person, or any bonus, deferred  compensation,  pension,  profit sharing,
    stock option, employee stock purchase,  retirement or other employee benefit
    plan  providing  for annual  payments of, or benefits  having a total annual
    value to any employee of more than $100,000;

         (ii) any  agreement,  indenture  or  other  instrument  which  contains
    restrictions with respect to payment of dividends or any other  distribution
    in respect of its capital stock;

         (iii)  any  agreement,  contract  or  commitment  relating  to  capital
    expenditures  other than contracts,  agreements or commitments not exceeding
    $75,000  individually,  or  $300,000  in the  aggregate,  except for capital
    expenditures  contained in the 2000 Company Capital  Expenditures Budget set
    forth in Section 4.11(a)(i) of the Company Disclosure Letter;

         (iv) any loan (other than accounts receivable from trade debtors in the
    ordinary course of business) or advance to (other than travel  allowances to
    the employees of the Company or any of its Subsidiaries),  or investment in,
    any Person or any agreement,  contract or commitment  relating to the making
    of any such loan, advance or investment;

         (v) any agreement evidencing  indebtedness of the Company or any of its
    Subsidiaries,  including loan and credit  agreements,  promissory  notes and
    other instruments of indebtedness;

         (vi) any  guarantee  or other  contingent  liability  in respect of any
    indebtedness  or  obligation of any Person  (other than the  endorsement  of
    negotiable instruments for collection in the ordinary course of business);

         (vii) any  management  service,  consulting  or any other  similar type
    contract (including any employee lease or outsourcing arrangement) providing
    for annual payments of more than $100,000;

         (viii) any  agreement,  contract or commitment  limiting the ability of
    the Company to engage in any line of business or to compete with any Person;

         (ix) any agreement,  contract or commitment  which involves annual base
    payments  of $150,000 or more and which is not  cancelable  without  penalty
    within 120 days;

         (x) any agreement,  contract or commitment  regarding (i) the purchase,
    sale,  lease or  disposal of any capital  stock or other  securities  of the
    Company  or any of its  Subsidiaries  or (ii) the  purchase,  sale  lease or
    disposal of any assets of the Company or any of its Subsidiaries  other than
    in the ordinary course of business;

         (xi) any agreement,  contract or commitment (other than as set forth in
    item (i) above) with any  Affiliate,  stockholder or employee of the Company
    or any of its  Subsidiaries  (including  any  officer,  director,  agent  or
    consultant) other than in the ordinary course of business; or

         (xii) any agreement, contract or commitment outside the ordinary course
    of business providing for payments of more than $150,000.

         (b)  Except  as  set  forth  in the  Section  4.11(b)  of  the  Company
Disclosure  Letter,  each Company  Contract  which has not expired in accordance
with its terms is valid and  binding,  in full force and effect and  enforceable
against the parties thereto in accordance  with their  respective  terms,  other
than such  failures  to be so valid and  binding,  in full  force and  effect or
enforceable which, could not reasonably be expected to have, either individually
or in the aggregate,  a Company Material Adverse Effect.  Except as set forth in
the Section  4.11(b) of the Company  Disclosure  Letter,  there is not under any
Company Contract any existing default,  or event which, after notice or lapse of
time,  or  both,  would  constitute  a  default,  by the  Company  or any of its
Subsidiaries,  or to the  Company's  Knowledge,  any other party,  except to the
extent such default could not reasonably be expected to have a Company  Material
Adverse Effect.

         Section 4.12 Accounts  Receivable.  Except as set forth in Section 4.12
of the Company Disclosure Letter, the accounts receivable of the Company and its
Subsidiaries recorded in the Financial Statements have arisen in bona fide arm's
length transactions in the ordinary course of business, and all such receivables
still outstanding are valid and binding  obligations of the account debtors and,
to the Company's Knowledge, without counterclaims, set-offs or other defenses.

         Section 4.13 Legal Proceedings.  Except as disclosed in Section 4.13 of
the Company  Disclosure  Letter (i) there are no actions,  suits or  proceedings
pending or, to the Knowledge of the Company,  threatened or, to the Knowledge of
the Company,  investigations  pending or  threatened  against the Company or its
Subsidiaries (or any of their respective properties,  rights or franchises),  at
law or in equity,  or before or by any  federal,  state or  foreign  commission,
board, bureau, agency, regulatory or administrative instrumentality,  employment
tribunal or other  Governmental  or  Regulatory  Authority or any  arbitrator or
arbitration  tribunal,  that could reasonably be expected to, individually or in
the  aggregate,  have a  Company  Material  Adverse  Effect  or  could  prevent,
materially  impair or  materially  delay the  consummation  of the  transactions
contemplated  hereby and (ii) neither the Company nor any of its Subsidiaries is
subject to any  judgment,  order or decree  entered in any  material  lawsuit or
proceeding.

         Section 4.14 Permits;  Compliance  with Laws and Orders.  Except as set
forth in Section 4.14 of the Company  Disclosure Letter, (i) the Company and its
Subsidiaries  hold, all permits,  licenses,  variances,  exceptions,  orders and
approvals of all Governmental or Regulatory Authorities necessary for the lawful
conduct of their respective  businesses (the "Company Permits"),  except for the
failure to hold such Company  Permits which could not reasonably be expected to,
individually or in the aggregate,  have a Company Material Adverse Effect;  (ii)
the Company and its Subsidiaries are in compliance with the terms of the Company
Permits, except where the failure to comply could not reasonably be expected to,
individually  or in the aggregate,  have a Company  Material  Adverse Effect and
(iii);  the businesses of the Company and its  Subsidiaries  are not being,  and
have not been, conducted in violation of any law, ordinance or regulation of any
Governmental  or  Regulatory  Authority,   except  for  violations  or  possible
violations  which could not  reasonably be expected to,  individually  or in the
aggregate,  have a Company Material  Adverse Effect.  This Section 4.14 shall be
deemed not to include representations and warranties with respect to the matters
covered in Sections 4.3, 4.4, 4.15, 4.16, 4.17, 4.18, 4.19, 4.23 and 4.24.

         Section 4.15 Employee  Benefit Plans.  (a) List of Plans.  Set forth in
Section  4.15(a) of the Company  Disclosure  Letter is an accurate  and complete
list of all  domestic  and,  subject as provided  by the final  sentence of this
Section  4.15(a),  foreign (i) "employee  benefit  plans," within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended,
and the rules and  regulations  thereunder  ("ERISA"),  where  applicable;  (ii)
bonus,  stock  option,  stock  purchase,  restricted  stock,  incentive,  fringe
benefit, "voluntary employees' beneficiary associations" ("VEBAs") under Section
501(c)(9) of the Code, where applicable,  profit-sharing, pension or retirement,
deferred compensation,  medical, life insurance,  disability,  accident,  salary
continuation,   severance,  accrued  leave,  vacation,  sick  pay,  sick  leave,
supplemental retirement and unemployment benefit plans, programs,  arrangements,
commitments  and/or  practices  (whether  or  not  insured);  (iii)  employment,
consulting, termination, and severance contracts or agreements; in each case for
active, retired or former employees or directors, whether or not any such plans,
programs,  arrangements,  commitments,  contracts,  agreements  and/or practices
(referred to in (i), (ii) or (iii) above) are in writing or are otherwise exempt
from the  provisions  of  ERISA;  that  have  been  established,  maintained  or
contributed  to (or with respect to which an obligation  to contribute  has been
undertaken)  or with  respect to which any  potential  liability is borne by the
Company  or any of its  Subsidiaries,  including,  solely for this  purpose  and
solely for the purpose of all of the  representations  in this Section 4.15, any
predecessors to the Company or to any Subsidiaries and all employers (whether or
not incorporated) that would be treated together with the Company and any of its
Subsidiaries  as a single employer within the meaning of Section 414 of the Code
("Employee Benefit Plans").  In respect of each of the UK Subsidiaries  acquired
by Lighthouse Holdings (UK) Limited, the details of Employee Benefit Plans as at
the  date  of the  relevant  Acquisition  Agreement  disclosed  by  the  Company
Disclosure Letter are not incomplete or inaccurate in any material respect as at
the date of this Agreement (and as of the Effective Date).

         (b)  Status of Plans.  Except as set forth in  Section  4.15(b)  of the
Company  Disclosure  Letter,  each Employee  Benefit Plan (including any related
trust) complies in form with the requirements of all applicable laws, including,
without limitation,  ERISA and the Code, where applicable,  and has at all times
been  maintained and operated in substantial  compliance  with its terms and the
requirements of all applicable laws,  including,  without limitation,  ERISA and
the Code.  Except as set forth in  Section  4.15(b)  of the  Company  Disclosure
Letter,  no complete or partial  termination  of any  Employee  Benefit Plan has
occurred or, to the  Knowledge of the Company,  is expected to occur.  Except as
set forth in Section  4.15(b) of the  Company  Disclosure  Letter,  neither  the
Company  nor  any  of  its  Subsidiaries   has  any  commitment,   intention  or
understanding to create, modify or terminate any Employee Benefit Plan except as
required or provided by  applicable  law or in the  ordinary  course of business
consistent with past practice.  Except as required to maintain the tax-qualified
status of any Employee  Benefit Plan intended to qualify under Section 401(a) of
the Code or as required by other  applicable  law, no condition or  circumstance
exists that would prevent the amendment or termination  of any Employee  Benefit
Plan. To the Knowledge of the Company, no event has occurred and no condition or
circumstance  has  existed  that could  reasonably  be  expected  to result in a
material  increase  in the  benefits  under or the  expense of  maintaining  any
Employee  Benefit  Plan from the level of benefits or expense  incurred  for the
most recent fiscal year ended thereof.

         (c) No Pension Plans. No Employee Benefit Plan is an "employee  pension
benefit plan"  (within the meaning of Section 3(2) of ERISA)  subject to Section
412 of the Code or Section 302 or Title IV of ERISA.  Within the past six years,
neither the Company nor any of its  Subsidiaries  has  maintained or contributed
to, or had any obligation to contribute to, any "multiple employer plan" (within
the  meaning of the Code or ERISA) or any  "multiemployer  plan" (as  defined in
Section 4001(a)(3) of ERISA).

         (d) Liabilities.  Except as set forth in Section 4.15(d) of the Company
Disclosure Letter, neither the Company nor any of its Subsidiaries maintains any
Employee Benefit Plan which is a "group health plan" (as such term is defined in
Section  607(1) of ERISA or  Section  5000(b)(1)  of the Code) that has not been
administered  and operated in all  respects in  compliance  with the  applicable
requirements  of Part 6 of Subtitle B of Title I of ERISA and  Section  4980B of
the Code  except  where the  failure  to comply  does not  result in a  material
liability and neither the Company nor any of its  Subsidiaries is subject to any
material liability,  including,  without limitation,  additional  contributions,
fines,  taxes,  penalties  or  loss  of  tax  deduction  as  a  result  of  such
administration  and operation.  No Employee Benefit Plan which is a group health
plan is a "multiple employer welfare arrangement," within the meaning of Section
3(40)  of  ERISA.  Each  Employee  Benefit  Plan  that is  intended  to meet the
requirements  of Section 125 of the Code meets such  requirements,  except where
the failure to meet such requirements  does not result in a material  liability,
and each  program of benefits  for which  employee  contributions  are  provided
pursuant to elections under any Employee  Benefit Plan meets the requirements of
the Code applicable thereto,  except where the failure to meet such requirements
does not result in a material liability.

         Except  as set  forth in  Section  4.15(d)  of the  Company  Disclosure
Letter,  neither the Company nor any of its Subsidiaries  maintains any Employee
Benefit Plan (whether  qualified or  non-qualified  under Section  401(a) of the
Code) providing for  post-employment  or retiree health,  life insurance  and/or
other welfare benefits and having unfunded liabilities,  and neither the Company
nor any of its Subsidiaries  have any obligation to provide any such benefits to
any retired or former  employees or active  employees  following such employees'
retirement  or  termination  of  service.  Neither  the  Company  nor any of its
Subsidiaries has any unfunded  liabilities pursuant to any Employee Benefit Plan
that is not  intended  to be  qualified  under  Section  401(a) of the Code.  No
Employee  Benefit Plan holds as an asset any  interest in any annuity  contract,
guaranteed  investment  contract or any other investment or insurance  contract,
policy or  instrument  issued by an insurance  company that, to the Knowledge of
the Company,  is or may  reasonably be expected to be the subject of bankruptcy,
conservatorship, insolvency, liquidation, rehabilitation or similar proceedings.

         Except  as set  forth in  Section  4.15(d)  of the  Company  Disclosure
Letter,  neither  the  Company  nor any of its  Subsidiaries  has  incurred  any
liability for any tax or excise tax arising under Chapter 43 of the Code, and to
the  Knowledge  of the  Company  no  event  has  occurred  and no  condition  or
circumstance  has existed that could  reasonably be expected to give rise to any
liability.

         Except  as set  forth in  Section  4.15(d)  of the  Company  Disclosure
Letter,  there are no actions,  suits,  claims or disputes  pending,  or, to the
Knowledge of the  Company,  threatened,  anticipated  or expected to be asserted
against or with respect to any Employee  Benefit Plan, or the assets of any such
plan (other  than  routine  claims for  benefits  and appeals of denied  routine
claims),  or any fiduciary (in such capacity) of such plan.  Except as set forth
in Section 4.15(d) of the Company Disclosure Letter, no civil or criminal action
brought  pursuant to the  provisions  of Title I, Subtitle B, Part 5 of ERISA is
pending, threatened, anticipated, or expected to be asserted against the Company
or any of its Subsidiaries or any fiduciary of any Employee Benefit Plan, in any
case with respect to any Employee Benefit Plan. To the Knowledge of the Company,
except as set forth in Section  4.15(d) of the  Company  Disclosure  Letter,  no
Employee Benefit Plan or any fiduciary  thereof (in such capacity) is the direct
or  indirect   subject  of  an  audit,   investigation  or  examination  by  any
governmental or quasi-governmental agency.

         (e)  Contributions.  Full  payment  has been timely made of all amounts
which the Company or any of its  Subsidiaries is required,  under applicable law
or under any  Employee  Benefit Plan or any  agreement  relating to any Employee
Benefit Plan to which the Company or any of its Subsidiaries is a party, to have
paid as  contributions or premiums thereto as of the last day of the most recent
fiscal year of such  Employee  Benefit Plan ended prior to the date hereof.  The
Company has made  adequate  provision  for  reserves to meet  contributions  and
premiums and any other  liabilities that have not been paid or satisfied because
they are not yet due under the terms of any Employee  Benefit  Plan,  applicable
law or related  agreements.  Benefits  under all Employee  Benefit  Plans are as
represented  in this  Section  4.15  and  have  not  been  materially  increased
subsequent to the date as of which documents have been provided.

         (f) Tax  Qualification.  Except as set forth in Section  4.15(f) of the
Company Disclosure  Letter,  each Employee Benefit Plan intended to be qualified
under Section 401(a) of the Code and each trust  established in connection  with
any Employee  Benefit  Plan which is intended to be exempt from  Federal  income
taxation under Section 501(a) of the Code has been determined to be so qualified
or exempt by the Internal  Revenue Service (or is within the remedial  amendment
period  for  submitting  an  application  for a  determination  letter  with the
Internal Revenue Service and is awaiting  receipt of a response).  Each VEBA has
been determined by the Internal Revenue Service to be exempt from Federal income
tax under  Section  501(c)(9)  of the Code.  Since the date of each most  recent
determination  referred  to in  this  paragraph  (f),  to the  Knowledge  of the
Company, no event has occurred and no condition or circumstance has existed that
resulted or is likely to result in the revocation of any such  determination  or
that could adversely  affect the qualified  status of any such Employee  Benefit
Plan or the exempt status of any such trust or VEBA.

         (g) Transactions. Except as set forth in Section 4.15(g) of the Company
Disclosure  Letter,  neither the Company nor any of its  Subsidiaries nor any of
their  respective  directors,  officers,  employees  or, to the Knowledge of the
Company,  other Persons who participate in the operation of any Employee Benefit
Plan or related  trust or  funding  vehicle to which  ERISA is  applicable,  has
engaged in any transaction with respect to any Employee Benefit Plan or breached
any applicable fiduciary  responsibilities or obligations under Title I of ERISA
that would  subject  any of them to a material  tax,  penalty or  liability  for
prohibited  transactions or breach of any obligations under ERISA or the Code or
would result in any material claim being made under, by or on behalf of any such
Employee Benefit Plan by any party with standing to make such claim.

         (h) Triggering  Events.  Except as set forth in Section  4.15(h) of the
Company  Disclosure Letter, the execution of this Agreement and the consummation
of the transactions  contemplated  hereby,  do not constitute a triggering event
under any Employee Benefit Plan, policy, arrangement,  statement,  commitment or
agreement,  whether or not legally enforceable,  which (either alone or upon the
occurrence  of any  additional  or  subsequent  event) will or may result in any
payment  (whether of severance pay or otherwise),  "parachute  payment" (as such
term is defined in Section 280G of the Code, in the case of any Employee Benefit
Plan to which such section is applicable),  acceleration, vesting or increase in
benefits to any employee or former employee or director of the Company or any of
its  Subsidiaries.  Except  as set  forth  in  Section  4.15(h)  of the  Company
Disclosure Letter, or, in the case of the UK Subsidiaries,  otherwise  disclosed
in the Company  Disclosure  Letter,  no Employee  Benefit Plan  provides for the
payment of severance, termination, change in control or similar-type payments or
benefits.

         (i) Documents.  The Company has made available to Parent or its counsel
true and complete copies of all material documents forming part of each Employee
Benefit Plan, including, without limitation (where applicable): (i) all Employee
Benefit  Plans as in effect on the date  hereof,  together  with all  amendments
thereto,  including,  in the case of any Employee  Benefit Plan not set forth in
writing,  a  written  description   thereof;   (ii)  all  current  summary  plan
descriptions,  summaries of material modifications, and material communications;
(iii) all current trust  agreements,  declarations  of trust and other documents
establishing  other funding  arrangements  (and all  amendments  thereto and the
latest  financial  statements  thereof);  (iv) the most recent Internal  Revenue
Service determination letter obtained with respect to each Employee Benefit Plan
or related trust  intended to be qualified  under Section  401(a) of the Code or
exempt under Section  501(a) or 501(c)(9) of the Code;  (v) the annual report on
Internal  Revenue  Service  Form  5500-series  or 990 for each of the last three
years for each Employee  Benefit Plan required to file such form;  (vi) the most
recently prepared financial  statements for each Employee Benefit Plan for which
such  statements are required;  and (vii) all material  contracts and agreements
relating to each Employee Benefit Plan, including,  without limitation,  service
provider  agreements,   insurance  contracts,   annuity  contracts,   investment
management agreements,  subscription agreements,  participation agreements,  and
recordkeeping agreements and collective bargaining agreements.

         (j) Except as set out in  section  4.15(j)  of the  Company  Disclosure
Letter,  no UK Subsidiary has any  contractual  agreement,  which exists for the
provision  of relevant  benefits (as defined in Section 612 of the UK Income and
Corporation Taxes Act 1988 ("ICTA")) for any past or present officer or employee
of any UK Subsidiary  (or  predecessor  in business of any UK Subsidiary) or for
any relative or dependant of any such a person in  connection  with which any UK
Subsidiary is or may become liable to make any payment.

         Section 4.16  Employment  Relations and Agreement.  (a) Except as could
not  reasonably  be expected  to have a Company  Material  Adverse  Effect or as
disclosed in Section 4.16(a) of the Company  Disclosure  Letter, (i) each of the
Company and its  Subsidiaries  is, and at all times has been, in compliance with
all Federal, state or other applicable laws respecting employment and employment
practices,  terms and conditions of employment  and wages and hours,  and is not
and, to the  Knowledge  of the  Company,  has not,  engaged in any unfair  labor
practice;  (ii) no unfair labor practice complaint against the Company or any of
its  Subsidiaries  is pending before the National Labor Relations  Board;  (iii)
there is no labor strike, dispute,  slowdown or stoppage actually pending or, to
the Knowledge of the Company, threatened against or involving the Company or any
of its  Subsidiaries,  (iv) no  representation  question  exists  respecting the
employees of the Company or any of its Subsidiaries;  (v) no grievance exists to
the Company's Knowledge,  no arbitration  proceeding arising out of or under any
collective  bargaining  agreement  is  pending  and no claim  therefor  has been
asserted;  (vi) no collective  bargaining  agreement or agreement or arrangement
with any trade union or staff  association  is in effect or is  currently  being
negotiated by the Company or any of its  Subsidiaries;  (vii) no Key Employee of
the Company or any of the Company's Subsidiaries has given written notice to the
Parent of any plans to terminate his, her or its employment or relationship with
the Company or any of the Company's Subsidiaries, and to the Company's Knowledge
has not threatened  orally or in writing to terminate her, his or its employment
or  relationship  with the  Company or any of the  Company's  Subsidiaries;  and
(viii)  in the 12  months  preceding  the date of this  Agreement,  neither  the
Company nor any of its  Subsidiaries  has given  notice of  redundancies  to the
Secretary of State or started consultations with a trades union under Chapter II
of Part IV of the UK Trade Union and Labour Relations  (Consolidation)  Act 1992
or failed to comply  with its  obligations  under  Chapter II of Part IV of that
Act;  or been a party to a relevant  transfer  (as  defined in the  Transfer  of
Undertakings  (Protection of Employment)  Regulations  1981) or failed to comply
with a duty to inform and consult under those Regulations.

         (b) Except as set forth in Section  4.16(b) of the  Company  Disclosure
Letter,  neither the Company nor any of its Subsidiaries has any written, or, to
the Knowledge of the Company,  any oral,  employment or severance agreement with
any other  Person  providing  for payments of more than  $100,000.  The executed
copies of the employment  agreements and similar agreements set forth in Section
4.16(b)  of the  Company  Disclosure  Letter  are  true  and  correct  and  such
agreements  have not since been  amended,  modified or  rescinded  except to the
extent disclosed to Parent.

         Section  4.17 Taxes.  (a) Tax  Returns.  Except as set forth in Section
4.17 of the Company  Disclosure Letter, the Company and each of its Subsidiaries
has  timely  filed or caused  to be timely  filed  with the  appropriate  taxing
authorities  all  material  returns,  statements,  forms and  reports  for Taxes
("Returns") that are required to be filed as of the date hereof and will so file
all Returns that are required to be filed on or prior to the Closing Date.  Such
Returns have  accurately  reflected  (or in the case of the returns that are not
yet due,  will  accurately  reflect)  all  material  liability  for Taxes of the
Company  and its  Subsidiaries  for the  periods  covered  thereby and all other
information  presented  on such  Returns is true,  correct  and  complete in all
material respects.

         (b)  Payment  of  Taxes.  Except as set  forth in  Section  4.17 of the
Company   Disclosure   Letter,  all  material  Taxes  of  the  Company  and  its
Subsidiaries  for all taxable years or periods that end on or before the Closing
Date and, with respect to any taxable year or period beginning before and ending
after the Closing Date, the portion of such taxable year or period ending on and
including the Closing Date  ("Pre-Closing  Period") have been or will,  prior to
the  Closing,  be timely  paid in full or (x) with  respect to taxable  years or
periods (or portions  thereof) ending on or prior to December 31, 1999,  accrued
and fully provided for in accordance with GAAP on the Balance Sheet and (y) with
respect to tax periods (or portions thereof)  beginning after December 31, 1999,
accrued on the books and records of the Company and its  Subsidiaries  as of the
Closing Date in accordance  with GAAP or other  applicable  non-U.S.  accounting
standards  and to the extent not paid when due (i) with  respect to Taxes due on
or prior to the date  hereof,  disclosed  in writing to Parent prior to the date
hereof and (ii) with respect to Taxes due after the date hereof, but on or prior
to the Closing Date, disclosed in writing to Parent prior to the Closing Date.

         (c)  Except  as set forth in  Section  4.17 of the  Company  Disclosure
Letter:

         (i)  Neither  the  Company  nor any of its  Subsidiaries  has  been the
subject of an audit or other  examination of Taxes by the tax authorities of any
nation,  state  or  locality  pursuant  to  which  the  Company  or  any  of its
Subsidiaries may be liable for any Taxes after the Closing,  nor has the Company
or any of  its  Subsidiaries  received  any  written  notices  from  any  taxing
authority  relating  to any issue which could  affect the Tax  liability  of the
Company or any of its Subsidiaries.

         (ii)  Neither the Company nor any of its  Subsidiaries  (A) has entered
into an  agreement  or waiver or been  requested  to enter into an  agreement or
waiver  extending  any  statute  of  limitations  relating  to  the  payment  or
collection  of  Taxes of the  Company  or any of its  Subsidiaries  that has not
expired,  (B) is  presently  contesting  any Tax  liability  before  any  court,
tribunal  or  agency  or (C)  has  applied  for  and/or  received  a  ruling  or
determination   from  a  taxing  authority   regarding  a  past  or  prospective
transaction of the Company or any of its Subsidiaries.

         (iii) Neither the Company nor any of its Subsidiaries has been included
in any "consolidated," "unitary" or "combined" Return provided for under the law
of the United  States,  any foreign  jurisdiction  or any state or locality with
respect to Taxes for any taxable period for which the statute of limitations has
not expired (other than a group of which the Company and/or its Subsidiaries are
the only members).

         (iv) All material Taxes which the Company or any of is  Subsidiaries is
(or was)  required  by law to  withhold  or collect  have been duly  withheld or
collected,  and have been  timely  paid over to the  proper  authorities  to the
extent due and payable.

         (v) No written  claim has ever been made by any taxing  authority  in a
jurisdiction  where the  Company  or any of its  Subsidiaries  does not file Tax
Returns that the Company or any of its  Subsidiaries,  as the case may be, is or
may be subject to taxation by that jurisdiction.

         (vi) There are no tax sharing,  allocation,  indemnification or similar
agreements  in effect as between the Company or any of its  Subsidiaries  or any
predecessor or Affiliate thereof (other than such agreements between the Company
and wholly-owned  Subsidiaries)  and any other party (including any predecessors
or Affiliates thereof) under which Parent, Merger Sub, the Company or any of its
Subsidiaries could be liable for any Taxes or other claims of such other party.

         (vii) Neither the Company nor any of its  Subsidiaries has applied for,
been  granted,  or agreed to any  accounting  method change for which it will be
required to take into account any  adjustment  under  Section 481 of the Code or
any similar  provision of the Code or the  corresponding tax laws of any nation,
state or locality.

         (viii) No election  under  Section  341(f) of the Code has been made or
shall be made  prior to the  Closing  Date to treat  the  Company  or any of its
Subsidiaries as a consenting corporation, as defined in Section 341 of the Code.

         (ix) Neither the Company nor any of its  Subsidiaries is a party to any
agreement, policy, arrangement,  statement,  commitment,  whether or not legally
enforceable,  which, as in effect on the date hereof,  (either alone or upon the
occurrence  of any  additional  or  subsequent  event)  will or may  require the
Company or any of its Subsidiaries or any Affiliate  thereof to make any payment
that would  constitute  an "excess  parachute  payment" for purposes of Sections
280G and 4999 of the Code.

         (x) Neither the Company nor any of its Subsidiaries is a "United States
real property holding  corporation"  within the meaning of Section  897(c)(2) of
the Code.

         (xii)  Neither the Company  nor any of its  Subsidiaries  has taken any
action or knows of any fact,  agreement  or plan  that is  reasonably  likely to
prevent the Merger from  qualifying  as a  reorganization  within the meaning of
Section 368(a) of the Code.

         (xiii) The Company and each Subsidiary have delivered or made available
to Parent  copies of each of the Returns for income Taxes filed on behalf of the
Company  and each  Subsidiary  since  December  31,  1998,  with  respect to the
Company, and since December 31, 1996, with respect to the Subsidiaries.

         (xiv) No UK Subsidiary  has within the previous six years  acquired any
assets from another UK Subsidiary which was at any relevant time a member of the
same group of  companies  (as defined in Section 170 TCGA 1992) as that of which
any UK  Subsidiary  was also a member or an  associated  company  as  defined in
Section 774 ICTA 1988.

         (xv) No UK Subsidiary  is, nor will any become,  liable to pay, or make
reimbursement  or  indemnity  in respect  of, any Tax  liability  (or any amount
corresponding  to a Tax  liability)  which is also a Tax  liability  of  another
person  and which is  payable  by the UK  Subsidiary  by virtue of (A) the other
person  failing to discharge  such Tax liability and (B) UK Subsidiary  being at
any time  before  Closing a member  of the same  group as such  other  person or
otherwise connected with or related to such other person for Tax purposes.

         (xvi) No UK  Subsidiary  has entered into any  indemnity,  guarantee or
covenant  under  which it has  agreed  or can be  procured  to meet or pay a sum
equivalent to or by reference to another person's liability to Tax.

         (xvii)  No UK  Subsidiary  is  liable,  nor has any  event or  omission
occurred  in  consequence  of which a UK  Subsidiary  could  at any time  become
liable,  to make a payment  to any Person as a result of the  discharge  by that
Person of any  liability  of the  relevant UK  Subsidiary  to Tax incurred on or
before Closing.

         (xviii) All  documents to which any UK  Subsidiary is a party and under
which the  relevant UK  Subsidiary  has any rights or which form part of such UK
Subsidiary's  title to any asset  owned by it have been  duly  stamped  with the
correct amount of stamp duty and any  applicable  stamp or other duty in respect
of such documents has been  accounted for and paid and no such  documents  which
are outside the United  Kingdom  would  attract  stamp duty if they were brought
into the United Kingdom.

         (xiv)  Each  UK  Subsidiary  has  complied  in all  respects  with  the
provisions  of Part IV Finance Act 1986 (stamp  duty  reserve  tax) and with any
regulations  made under it and  neither it nor any  nominee for it is a party to
any  agreement  which  falls  within  the  terms  of  Section  87(1) of that Act
(principal  charge)  and in  relation  to which the  conditions  referred  to in
Section  92(1) of that Act  (repayment  or  cancellation  of Tax)  have not been
fulfilled.

         (xx)  As at 6 April  1999,  no UK  Subsidiary  had  unrelieved  surplus
advance corporation tax, as defined The Corporation Tax (Treatment of Unrelieved
Surplus Advance Corporation Tax) Regulations 1999 (SI 1999/358) (the "Shadow ACT
Regulations").

         (xxi) No UK Subsidiary  has at any time on or after 6 April 1999 been a
member of any group (for the  purposes of the Shadow ACT  Regulations)  that had
another member which had unrelieved surplus advance  corporation tax (as defined
in such Regulations) as at 6 April 1999.

         (xxii) No securities  (within the meaning of Section  254(1) ICTA 1988)
issued by any UK Subsidiary and remaining in issue at the date of this Agreement
were issued in circumstances  such that the interest or any other amount payable
on those securities falls to be treated as a distribution.

         (xxiii) No UK Subsidiary  has, within the period of six years preceding
Closing,  made or  received  any  distribution  which is an exempt  distribution
within Sections 213 to 218(1) (inclusive) ICTA 1988 (demergers).

         (xxiv) No shares in or assets of any UK Subsidiary  were acquired by it
or (as the case may be) the  Company  in  circumstances  such  that they have or
might become  subject to any Inland  Revenue charge or continue to be subject to
any Inland  Revenue  charge to which they were subject  immediately  before such
acquisition  or such that, if they bad been subject to an Inland  Revenue charge
immediately before such acquisition,  they would have continued to be subject to
it.

         Section 4.18 Intellectual  Property. (a) Except as set forth on Section
4.18(a) of the  Company  Disclosure  Letter,  the  Company  or its  Subsidiaries
exclusively  owns, free and clear of all Liens (other than Permitted  Liens), or
is licensed to use,  the rights to all  domestic  and  foreign  patents,  patent
applications,  registered and unregistered  trademarks and service marks,  trade
names,   company  names,   copyrights   together  with  any   registrations  and
applications   therefor,   Internet   domain  names,   net  lists,   schematics,
inventories,  technology,  trade  secrets,  proprietary  information,  know-how,
databases,  inventions,  computer software  programs or applications  including,
without  limitation,  all object and source  codes and  tangible  or  intangible
proprietary  information  or material that are used or necessary in the business
of  the  Company  and  any of  its  Subsidiaries  as  currently  conducted  (the
"Intellectual  Property"),  except for such Intellectual Property the failure of
which to own or license could not  reasonably be expected to result in a Company
Material Adverse Effect.  Section 4.18(a) of the Company  Disclosure Letter sets
forth:  (i)  all  material   patents,   patent   applications,   registered  and
unregistered   trademarks  and  service  marks,  trade  names,   company  names,
registered copyrights,  and any applications therefor, foreign and domestic; and
(ii) all material  licenses and other  agreements to which the Company or any of
its  Subsidiaries is a party (the  "Licenses") and pursuant to which the Company
or any of its  Subsidiaries is authorized to use any  Intellectual  Property and
includes the identities of the parties  thereto and the  applicable  royalty and
the term thereof.  Neither the Company nor any of its  Subsidiaries  is, or as a
result of the execution,  delivery or  performance of the Company's  obligations
hereunder will be, in violation of, or lose any rights  pursuant to, any license
or  agreement  set forth in Section  4.18(a) of the Company  Disclosure  Letter,
except for such losses or violations  which could not  reasonably be expected to
result in a Company Material Adverse Effect.

         (b) Except as set forth on Section  4.18(b) of the  Company  Disclosure
Letter,  no claims  have been  asserted  in writing to the Company or any of its
Subsidiaries  or, to the Knowledge of the Company,  are threatened by any Person
nor, to the  Knowledge of the  Company,  are there any grounds for any bona fide
claims  (i) to the  effect  that the  manufacture,  sale,  use,  offer for sale,
reproduction,  distribution  or  modification,  of any product or process by the
Company or any of its  Subsidiaries  infringes on any  copyright,  trade secret,
trademark, patent or other intellectual property right of any Person, (ii) that,
if sustained,  could  reasonably be expected to materially  adversely affect the
interests  of  the  Company  or  any of  its  Subsidiaries  in any  Intellectual
Property, or (iii) challenging the ownership,  validity or enforceability of any
of the  Intellectual  Property.  All patents and all  registered  trademarks and
service marks set forth in Section 4.18(a) of the Company  Disclosure Letter and
all  copyrights  held  by the  Company  or any of its  Subsidiaries  are  valid,
enforceable and subsisting,  except for such failure to be valid and enforceable
or subsisting  that could not reasonably be expected to,  individually or in the
aggregate,  have a Company  Material  Adverse  Effect.  To the  Knowledge of the
Company,  there is not and, to the Knowledge of the Company,  there has not been
any  unauthorized  use,   infringement  or   misappropriation   of  any  of  the
Intellectual Property by any Person, including, without limitation, any employee
or former employee.

         (c) The operation of the Company as of the Effective Time shall require
no rights under  Intellectual  Property other than the rights under Intellectual
Property owned by the Company and rights granted to the Company  pursuant to the
Licenses.

         Section 4.19  Environmental  Laws and Regulations.  (a) For purposes of
this section,  "Environmental  Law" shall mean any Federal,  state or local law,
statute,  rule,  regulation,  order or other  requirement of law relating to the
protection  of human  health or the  environment,  or to the  manufacture,  use,
transport,  treatment,  storage,  disposal,  release  or  threatened  release of
petroleum  products,  asbestos,  urea formaldehyde  insulation,  polychlorinated
biphenyls  or any  substance  listed,  classified  or  regulated as hazardous or
toxic, or any similar term, under such Environmental Law.

         (b) Except as could not reasonably be expected to,  individually  or in
the aggregate,  have a Company  Material  Adverse Effect or set forth in Section
4.19  of the  Company  Disclosure  Letter,  (i)  the  Company  and  each  of its
Subsidiaries  is in compliance with all applicable  Environmental  Laws, and has
obtained,  and is in  material  compliance  with,  all  permits  required  under
applicable  Environmental  Laws,  (ii)  neither  the  Company  nor  any  of  its
Subsidiaries  has received any written  notice of any  proceedings or actions by
any  governmental  authority or other Person pending or, to the Knowledge of the
Company,  threatened  against the Company,  or any of its Subsidiaries under any
Environmental  Law, and (iii) there are no facts,  circumstances  or  conditions
relating  to  the  business  or   operations  of  the  Company  or  any  of  its
Subsidiaries,  or to any real property at any time owned,  leased or operated by
the Company or any of its  Subsidiaries,  that could  reasonably  be expected to
give rise to any claim,  proceeding or action against the Company, or any of its
Subsidiaries  or to any  liability  of the  Company or any of its  Subsidiaries,
under any Environmental Law.

         Section  4.20  Liabilities.  Except for matters  reflected  or reserved
against in the  Balance  Sheet or as  disclosed  in Section  4.20 of the Company
Disclosure Letter, neither Company nor any of its Subsidiaries had at such date,
or has  incurred  since that  date,  any  material  liabilities  or  obligations
(whether absolute, accrued, contingent, fixed or otherwise, or whether due or to
become  due),  except   liabilities  or  obligations  (i)  which  were  incurred
subsequent  to the  Balance  Sheet  Date,  in the  ordinary  course of  business
consistent  with  past  practice  or (ii)  which  have not  been,  and could not
reasonably  be expected to,  individually  or in the  aggregate,  have a Company
Material Adverse Effect.

         Section 4.21 Insurance. (a) Set forth on Section 4.21(a) of the Company
Disclosure  Letter is an accurate and complete list of insurance  policies which
the Company and its  Subsidiaries  maintain  with  respect to their  businesses,
properties  or employees  and the Company has made  available to Parent true and
complete copies of each such insurance  policy.  Such policies are in full force
and effect  and, to the  Knowledge  of the  Company,  are free from any right of
termination  on the part of the  insurance  carriers.  Such  policies are in the
amounts  and  types  of  coverage  that are  customarily  carried  by  companies
similarly situated and by companies engaged in similar businesses. Since January
1,  1999,  there  has not been any  material  adverse  change  in the  Company's
relationship  with its  insurers  or in the  premiums  payable  pursuant to such
policies.

         (b) Set forth on Section 4.21(b) of the Company Disclosure Letter is an
accurate  and  complete  list of all  claims  made by the  Company or any of its
Subsidiaries  to its insurance  carriers  since the later of (i) January 1, 1999
and (ii) the date of the acquisition of the Subsidiary and the Company.

         Section 4.22 Acquisition  Agreement  Payments.  The consummation of the
transactions  contemplated  by this Agreement will not result in an acceleration
of the Contingent Payments.

         Section 4.23 Voting  Requirements.  The affirmative vote of the holders
of at least a majority of the outstanding shares of Class A Common Stock (voting
as one  class,  with each  share of Class A Common  Stock  having  one (1) vote)
entitled to be cast  approving this Agreement and the Merger is the only vote of
the holders of any class or series of the Company's  capital stock  necessary to
approve this  Agreement,  the Merger and the  transactions  contemplated by this
Agreement.

         Section 4.24 State Takeover Statutes;  Certain Charter Provisions.  The
Board of Directors of the Company has, to the extent such statute is applicable,
taken all action (including  appropriate  approvals of the Board of Directors of
the Company) necessary to exempt Parent, its Subsidiaries, their Affiliates, the
Merger,  this  Agreement,   the  Stockholder  Agreements  and  the  transactions
contemplated  hereby and thereby  from  Section 203 of the DGCL.  No other state
takeover  statutes and no charter or by-law  provisions  are  applicable  to the
Merger,  this  Agreement,   the  Stockholder  Agreements  and  the  transactions
contemplated hereby and thereby.

         Section 4.25  Brokers.  No broker,  investment  banker or other Person,
other than Lazard  Freres & Co. LLC, the fees and expenses of which will be paid
by the Company,  is entitled to any  broker's,  finder's or other similar fee or
commission in connection  with the  transactions  contemplated by this Agreement
based upon arrangements made by or on behalf of the Company.  A true and correct
copy of the  engagement  letter of Lazard  Freres & Co.  LLC as in effect on the
date hereof has been delivered to Parent.

         Section 4.26 No Other Representations or Warranties. Subject to Section
10.10 with  respect to claims for fraud and except for the  representations  and
warranties  contained in this Agreement,  the Company makes no representation or
warranty,  expressed or implied,  written or oral, and the Company hereby to the
maximum extent permitted by applicable law disclaims any such  representation or
warranty  (including  without  limitation any warranty of  merchantability or of
fitness for a particular  purpose),  whether by the Company,  its  Subsidiaries,
their  Affiliates  or any of their  officers,  directors,  employees,  agents or
representatives  or  any  other  Person,  with  respect  to the  Company  or its
Subsidiaries or the execution and delivery of this Agreement or the transactions
contemplated  hereby,  notwithstanding  the delivery or  disclosure to Parent or
Merger  Sub,  any  Affiliate  of Parent or Merger Sub or any of their  officers,
directors,  employees,  agents or  representatives  or any  other  Person of any
documentation or other  information by the Company or its Subsidiaries or any of
their Affiliates,  officers, directors,  employees, agents or representatives or
any other Person with respect to any one or more of the foregoing.

         Section 4.27  Customers.  Except as could not reasonably be expected to
have a Company  Material Adverse Effect,  the Company and its Subsidiaries  have
not received any written notice,  nor does the Company have any Knowledge,  that
any of the top five customers of the Company and its Subsidiaries (determined on
a  consolidated  basis by  revenues)  (i) have  ceased,  or will  cease,  to use
products,  goods and  services of the Company or its  Subsidiaries  or (ii) have
materially  reduced,  or will materially reduce,  the use of products,  goods or
services of the Company or its Subsidiaries.


                                    ARTICLE V

             REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

         Parent and Merger Sub represent and warrant to the Company as follows:

         Section 5.1 Organization and Qualification.  Each of Merger Sub, Parent
and Parent's Material  Subsidiaries is a corporation duly incorporated,  validly
existing and in good standing (with respect to jurisdictions which recognize the
concept of good standing) under the laws of its  jurisdiction  of  incorporation
and has full corporate power and authority to conduct its business as and to the
extent now  conducted and to own,  operate and lease its assets and  properties,
except for such failures to be so existing and in good standing (with respect to
jurisdictions  which  recognize  the concept of good  standing)  or to have such
power  and  authority  which,  individually  or  in  the  aggregate,  could  not
reasonably be expected to have a Parent Material Adverse Effect. Each of Parent,
Merger Sub and Parent's  Material  Subsidiaries is duly  qualified,  licensed or
admitted to do business and is in good standing  (with respect to  jurisdictions
which recognize the concept of good standing) in each  jurisdiction in which the
ownership, use or leasing of its assets and properties, or the conduct or nature
of its business, makes such qualification, licensing, admission or good standing
necessary, except for such failures to be so qualified or in good standing (with
respect to  jurisdictions  which recognize the concept of good standing)  which,
individually  or in the  aggregate,  could not  reasonably be expected to have a
Parent Material Adverse Effect.  Parent has previously  delivered to the Company
correct and complete  copies of the memorandum  and articles of association  and
by-laws (or other comparable charter documents) of Parent and Merger Sub.

         Section 5.2 Share Capital.  (a) The authorized  share capital of Parent
consists solely of (i) 416,000,000  Parent Shares, of which  277,218,378  shares
were issued and outstanding as of June 27, 2000. All of the issued Parent Shares
are, and all Parent Shares to be issued as the Merger Consideration  pursuant to
Section 2.5(c) will be, upon issuance, duly authorized, validly issued and fully
paid and voting, and no class of shares is entitled to preemptive rights, except
as  provided  in  Section 89 of the  Companies  Act 1985 of Great  Britain  (the
"Companies Act").

         (b) The authorized capital stock of Merger Sub consists of 1,000 shares
of common stock,  par value $.01 per share,  all of which are validly issued and
outstanding, fully paid and nonassessable and are owned by Parent free and clear
of all Liens.

         (c) Except as disclosed  in the Parent SEC Report or Section  5.2(c) of
the letter  dated the date hereof and  delivered by Parent and Merger Sub to the
Company  simultaneously  with the execution and delivery of this  Agreement (the
"Parent  Disclosure  Letter"),  as of July 4, 2000 there are no (i)  outstanding
Issuance Obligations obligating Merger Sub, Parent or any of its Subsidiaries to
issue or sell any  Parent  Shares  or  capital  stock  of  Merger  Sub or any of
Parent's  Material  Subsidiaries  or to  grant,  extend  or enter  into any such
Issuance  Obligation  (ii)  Voting  Debt  of  Parent  or  any  of  its  Material
Subsidiaries   or  (iii)   voting   trusts,   proxies   or  other   commitments,
understandings,  restrictions or arrangements to which Parent, Merger Sub or any
of Parent's  Material  Subsidiaries  is a party with respect to the voting of or
the right to participate in dividends or other earnings in respect of any shares
of Merger Sub, Parent or any of Parent's Material Subsidiaries.

         (d) Except as set forth in the  Parent SEC Report or Section  5.2(d) of
the  Parent  Disclosure  Letter,  all of the  outstanding  capital  stock of, or
ownership  interests in, each Material  Subsidiary of Parent is owned by Parent,
directly or  indirectly.  All of the issued and capital  stock of each  Material
Subsidiary is validly  existing,  fully paid and  non-assessable.  Except as set
forth in the  Parent  SEC  Report or  Section  5.2(d) of the  Parent  Disclosure
Letter,  no Material  Subsidiary  of Parent has  outstanding  Voting Debt and no
Material  Subsidiary  of  Parent is bound by,  obligated  under,  or party to an
Issuance  Obligation  with  respect to any  security  of Parent or any  Material
Subsidiary  of  Parent.  Except as set forth in the Parent SEC Report or Section
5.2(d) of the Parent Disclosure  Letter,  all of such capital stock or ownership
interest  is owned by  Parent,  directly  or  indirectly,  free and clear of all
Liens(other than Permitted Liens).

         Section 5.3 Authority  Relative to this  Agreement.  Each of Parent and
Merger  Sub has full power and  authority  to enter  into this  Agreement,  and,
subject to obtaining  the Parent  Shareholders'  Approval (as defined in Section
7.3(a)),   to  perform  its  obligations   hereunder,   and  to  consummate  the
transactions  contemplated  hereby.  The execution,  delivery and performance of
this Agreement by each of Parent and Merger Sub and the  consummation by each of
Parent and Merger Sub of the transactions contemplated hereby have been duly and
validly  approved by the Board of  Directors of Parent and Merger Sub. The Board
of Directors of Parent has passed a resolution declaring the advisability of the
Merger and  resolving  that the Merger be  submitted  for  consideration  by the
shareholders of Parent. No other corporate  proceedings on the part of Parent or
Merger Sub or their  shareholders  are  necessary  to authorize  the  execution,
delivery  and  performance  of this  Agreement  by Parent or Merger  Sub and the
consummation by Parent and Merger Sub of the transactions  contemplated  hereby,
other than obtaining the Parent Shareholders'  Approval. This Agreement has been
duly and validly  executed  and  delivered  by each of Parent and Merger Sub and
constitutes a legal,  valid and binding  obligation of each of Parent and Merger
Sub  enforceable  against each of Parent and Merger Sub in  accordance  with its
terms,  except as  enforceability  may be  limited  by  bankruptcy,  insolvency,
reorganization,  moratorium or other similar laws  affecting the  enforcement of
creditors' rights generally and by general equitable  principles  (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

         Section  5.4   Non-Contravention;   Approvals  and  Consents.  (a)  The
execution  and  delivery of this  Agreement  by each of Parent and Merger Sub do
not,  and the  performance  by each of Parent and Merger Sub of its  obligations
hereunder and the consummation of the transactions contemplated hereby will not,
conflict with,  result in a violation or breach of,  constitute (with or without
notice  or lapse  of time or both) a  default  under,  result  in or give to any
Person  any  right  of  payment  or  reimbursement,  termination,  cancellation,
modification or acceleration  of, or result in the creation or imposition of any
Lien upon any of the assets or properties  of Parent or any of its  Subsidiaries
under,  any of the terms,  conditions  or  provisions  of (i) the  memorandum or
articles of association or by-laws (or other  comparable  charter  documents) of
Parent or any of its Material  Subsidiaries  or (ii) subject to the obtaining of
the Parent  Shareholders'  Approval  and the taking of the actions  described in
paragraph (b) of this  Section,  (x) any laws or orders of any  Governmental  or
Regulatory  Authority  applicable to Parent or any of its Subsidiaries or any of
their respective  assets or properties,  or (y) any Contracts to which Parent or
any of its Subsidiaries is a party or by which Parent or any of its Subsidiaries
or any of their  respective  assets or properties is bound,  excluding  from the
foregoing clauses (x) and (y) conflicts,  violations, breaches, defaults, rights
of payment or  reimbursement,  terminations,  modifications,  accelerations  and
creations and  impositions  of Liens which,  individually  or in the  aggregate,
could not  reasonably be expected to have a Parent  Material  Adverse  Effect or
prevent,  materially impair or materially delay the ability of Parent and Merger
Sub to consummate the transactions contemplated by this Agreement.

         (b) Except (i) for the filing of a  pre-merger  notification  report by
Parent under the HSR Act,  (ii) for the filings with  various  state  securities
authorities that are required in connection with the  transactions  contemplated
by this  Agreement,  (iii) for the filing of the Certificate of Merger and other
appropriate  merger  documents  required by the DGCL with the Secretary of State
and appropriate documents with the relevant authorities of other states in which
the Constituent  Corporations are qualified to do business, (iv) for the filings
with, notices to, and approvals of, the UKLA and the LSE and (v) as disclosed in
Section 5.4(b) of the Parent Disclosure  Letter, no consent,  approval or action
of, filing with or notice to any  Governmental or Regulatory  Authority or other
public or private  third party is necessary or required  under any of the terms,
conditions or provisions of any law or order of any  Governmental  or Regulatory
Authority or any Contract to which Parent or any of its  Subsidiaries is a party
or by which Parent or any of its Subsidiaries or any of their respective  assets
or properties is bound for the execution and delivery of this  Agreement by each
of Parent and Merger Sub,  the  performance  by each of Parent and Merger Sub of
its obligations  hereunder or the consummation of the transactions  contemplated
hereby other than such consents,  approvals,  actions, filings and notices which
the  failure  to make or  obtain,  as the  case may be,  individually  or in the
aggregate,  could not reasonably be expected to have a Parent  Material  Adverse
Effect or prevent,  materially  impair or materially delay the ability of Parent
and Merger Sub to consummate the transactions contemplated by this Agreement.

         Section 5.5 SEC Reports and Financial Statements.  Parent has delivered
or made available to the Company a true and complete copy of each form,  report,
schedule,  registration statement, definitive proxy statement and other document
(together with all amendments  thereof and supplements  thereto) filed by Parent
with the SEC and each biannual report  distributed by Parent to its shareholders
since  December 31, 1997 (as such  documents have since the time of their filing
been amended or  supplemented,  the "SEC Reports"),  which are all the documents
(other than preliminary materials) that Parent was required to file with the SEC
since such date. As of their  respective  dates, the SEC Reports (i) complied as
to form in all material  respects with the requirements of the Securities Act or
the  Exchange  Act,  as the case may be,  and (ii) did not  contain  any  untrue
statement  of a material  fact or omit to state a material  fact  required to be
stated therein or necessary in order to make the statements therein, in light of
the  circumstances  under  which they were made,  not  misleading.  The  audited
consolidated  financial statements and unaudited interim consolidated  financial
statements (including, in each case, the notes, if any, thereto) included in the
SEC  Reports  (the  "Parent  Financial  Statements")  complied as to form in all
material  respects  with the  published  rules and  regulations  of the SEC with
respect  thereto,  were  prepared in  accordance  with UK GAAP (except as may be
indicated  therein or in the notes  thereto and except with respect to unaudited
statements) and fairly present  (subject,  in the case of the unaudited  interim
financial statements, to normal, recurring year-end audit adjustments (which are
not expected to be,  individually  or in the  aggregate,  materially  adverse to
Parent and its consolidated  Subsidiaries)) the consolidated  financial position
of Parent and its  consolidated  Subsidiaries as at the respective dates thereof
and the  consolidated  results  of  their  operations  and  cash  flows  for the
respective  periods then ended.  The related notes  reconciling to United States
generally accepted accounting principles such consolidated  financial statements
comply in all material  respects with the  requirements of the SEC applicable to
such reconciliation.

         Section 5.6 Absence of Certain  Changes or Events.  Except as disclosed
in the  Parent SEC  Report,  or Section  5.6 of the  Parent  Disclosure  Letter,
between  December 31, 1999 and the date of this Agreement (a) there has not been
(i)  any  change,  event,  occurrence  or  development  having,  or  that  could
reasonably  be expected  to,  individually  or in the  aggregate,  have a Parent
Material  Adverse  Effect;  (ii) any  material  change  by  Parent or any of its
Material Subsidiaries in its accounting methods,  principles or practices; (iii)
any damage, destruction or loss which individually or in the aggregate, resulted
in or could reasonably be expected to result in a Material  Adverse Effect;  and
(iv) any event pursuant to which Parent or any of its Material  Subsidiaries has
incurred any material liabilities  (direct,  contingent or otherwise) or engaged
in any material  transaction or entered into any material  agreement outside the
ordinary course of business which could  reasonably be expected to have a Parent
Material  Adverse  Effect;  and (b) Parent and its  Material  Subsidiaries  have
conducted their respective  businesses only in the ordinary course substantially
consistent with past practice.

         Section 5.7 Legal  Proceedings.  Except as  disclosed in the Parent SEC
Reports or in  Section  5.7 of the Parent  Disclosure  Letter,  (i) there are no
investigations,  actions,  suits or proceedings  pending or, to the knowledge of
Parent,  threatened  against,  nor, to the  knowledge  of Parent,  are there any
Governmental  or  Regulatory  Authority  investigations  or  audits  pending  or
threatened  against Parent or any of its  Subsidiaries  or any of its assets and
properties which, individually or in the aggregate, could reasonably be expected
to have a Parent  Material  Adverse  Effect  or  prevent,  materially  impair or
materially  delay the  ability  of  Parent  and  Merger  Sub to  consummate  the
transactions  contemplated by this Agreement, and (ii) neither Parent nor any of
its  Subsidiaries  is subject  to any order of any  Governmental  or  Regulatory
Authority which, individually or in the aggregate, is having or could reasonably
be  expected to have a Parent  Material  Adverse  Effect or prevent,  materially
impair or  materially  delay the ability of Parent and Merger Sub to  consummate
the transactions contemplated by this Agreement.

         Section 5.8 Information Supplied. The Parent Disclosure Documents will,
at all  relevant  times,  include  all  information  relating  to Parent and its
Subsidiaries which is required to enable the Parent Disclosure Documents and the
parties  hereto to comply in all material  respects with all  applicable  United
Kingdom statutory and other legal and regulatory provisions (including,  without
limitation,  the Companies Act, the FS Act, the Listing Rules and the Standards)
and all such  information  contained in such documents will be  substantially in
accordance with the facts and will not omit anything material which is likely to
affect the import of such information;  provided,  however, no representation is
made by Parent or Merger Sub with respect to information  supplied in writing by
or on behalf of the Company expressly for inclusion therein.

         Section 5.9 Permits;  Compliance  with Laws and Orders.  Parent and its
Subsidiaries  hold all permits,  licenses,  franchises,  variances,  exemptions,
orders and approvals of all  Governmental and Regulatory  Authorities  necessary
for the lawful conduct of their  respective  businesses (the "Parent  Permits"),
except for failures to hold such Parent  Permits which,  individually  or in the
aggregate,  are not having and could not reasonably be expected to have a Parent
Material Adverse Effect.  Parent and its Subsidiaries are in compliance with the
terms of the Parent Permits, except failures so to comply which, individually or
in the  aggregate,  could not  reasonably be expected to have a Parent  Material
Adverse Effect. Except as disclosed in the Parent SEC Report, neither Parent nor
its  Subsidiaries  are in  violation of or default  under any law,  ordinance or
regulation or order of any Governmental or Regulatory Authority, except for such
violations  or  defaults  which,  individually  or in the  aggregate,  could not
reasonably be expected to have a Parent Material  Adverse Effect.  Except as set
forth in Section 5.9 of the Parent Disclosure Letter, no investigation or review
by any Governmental or Regulatory Authority with respect to the Parent or any of
its Subsidiaries is pending or, to the knowledge of Parent, threatened,  nor, to
the knowledge of Parent, has any Governmental or Regulatory  Authority indicated
an intention to conduct the same,  other than,  in each case,  those which could
not reasonably be expected to,  individually or in the aggregate,  have a Parent
Material  Adverse  Effect.  This  Section  5.9  shall be deemed  not to  include
representations  and warranties  with respect to the matters covered in Sections
5.3, 5.4, 5.11 and 5.16.

         Section 5.10  Compliance  with  Agreements.  Except as disclosed in the
Parent SEC  Report or Section  5.10 of the  Parent  Disclosure  Letter,  neither
Parent nor any of its  Subsidiaries  is in breach or violation of, or in default
in the  performance  or observance of any term or provision of, and no event has
occurred  which,  with  notice  or lapse of time or both,  could  reasonably  be
expected  to  result in a default  under,  (i) the  memorandum  or  articles  of
association  (or other  comparable  charter  documents)  of Parent or any of its
material  Subsidiaries  or (ii)  any  Contract  to  which  Parent  or any of its
Subsidiaries is a party or by which Parent or any of its  Subsidiaries or any of
its  assets  or  properties  is bound,  except  in the case of  clause  (ii) for
breaches,  violations and defaults which,  individually or in the aggregate, are
not  having  and could not  reasonably  be  expected  to have a Parent  Material
Adverse Effect.

         Section 5.11 Vote Required.  The only votes of the holders of any class
of shares of Parent  required to approve  the Merger and the other  transactions
contemplated  hereby is the  affirmative  vote of a  majority  of such  ordinary
shareholders of Parent as (being entitled to do so) are present and vote (or, in
the case of a vote taken on a poll,  the  affirmative  vote by  shareholders  or
their proxies  representing  a majority of the Parent Shares in respect of which
votes were validly exercised) at the Parent Shareholders  Meeting in relation to
the approval of the Merger.

         Section 5.12  Business of Merger Sub.  Merger Sub was  organized on May
31, 2000 solely for the purpose of enabling  Parent to acquire the Company Stock
(including the  transactions  provided in this Agreement) and has not engaged in
any business or activities of any nature since it was  incorporated.  During the
period from the date of this Agreement  through the Effective  Time,  Merger Sub
shall not engage in any business or any  activities  of any nature which are not
solely for the purpose of enabling  Parent to acquire Company Stock and provided
in or contemplated by this Agreement.

         Section 5.13  Brokers.  No broker,  investment  banker or other Person,
other  than UBS  Warburg  LLC,  the fees and  expenses  of which will be paid by
Parent, is entitled to any broker's, finder's or other similar fee or commission
in connection  with the  transactions  contemplated by this Agreement based upon
arrangements made by or on behalf of Parent or Merger Sub.

         Section 5.14  Absence of  Undisclosed  Liabilities.  Except for matters
reflected or reserved against in the balance sheet as at December 31, 1999 or as
disclosed in Section 5.14 of the Parent  Disclosure  Letter,  neither Parent nor
any of its  Subsidiaries  had at such date, or has incurred since that date, any
material  liabilities or obligations  (whether  absolute,  accrued,  contingent,
fixed or  otherwise,  or whether due or to become due),  except  liabilities  or
obligations  (i)  which  were  incurred  in  the  ordinary  course  of  business
consistent  with  past  practice  or (ii)  which  have not  been,  and could not
reasonably  be expected  to,  individually  or in the  aggregate,  have a Parent
Material Adverse Effect.

         Section  5.15  Contracts.  Except as set forth in  Section  5.15 of the
Parent Disclosure Letter,  neither Parent nor its Subsidiaries is a party to, or
has any obligation under, any Contract which contains any covenant  currently or
prospectively  limiting  the  freedom  of Parent or any of its  Subsidiaries  to
engage in any line of  business  or to compete  with any  entity,  except to the
extent  such  limitations  could not  reasonably  be  expected  to have a Parent
Material  Adverse  Effect.  All Contracts to which Parent or any of its Material
Subsidiaries is a party or by which any of their respective  assets is bound are
valid and binding,  in full force and effect and enforceable against the parties
thereto in accordance with their respective  terms,  other than such failures to
be so valid and binding, in full force and effect or enforceable which could not
reasonably  be expected to,  either  individually  or in the  aggregate,  have a
Parent  Material  Adverse  Effect.  There is not  under  any such  Contract  any
existing  default or event which,  after notice or lapse of time, or both, would
constitute  a  default  by  Parent or any of its  Material  Subsidiaries  or, to
Parent's knowledge, any other party, except to the extent such default could not
reasonably be expected to have a Parent Material Adverse Effect.

         Section  5.16 Taxes.  Except as disclosed in Section 5.16 of the Parent
Disclosure Letter,  Parent and each Material  Subsidiary (i) has timely filed or
will timely file all material Tax Returns  required to be filed and such Returns
are and will be true, correct and complete in all material respects and (ii) all
material Taxes of the Parent and each  Subsidiary  which are due and payable for
all Pre-Closing  Periods have been or will be, prior to Closing,  timely paid in
full or reflected in accordance with UK GAAP on the Parent Financial Statements.
Parent and each Material Subsidiary has withheld or collected all material Taxes
they were  required to withhold and collect,  and have timely paid to the proper
authorities  such Taxes  withheld or  collected  to the extent due and  payable.
Parent,   or  one  or  more  of  its  "qualified   subsidiaries"  or  "qualified
partnerships" within the meaning of Treasury  Regulations Section  1.367-3(c)(5)
will have been engaged in an active trade or business outside the United States,
within the meaning of Treasury  Regulations Section  1.367(a)-2T(b)(2)  and (3),
for the entire previous 36-month period immediately preceding the Merger. Parent
(and, if applicable,  its qualified subsidiary or qualified  partnership engaged
in such  active  trade  or  business)  does not have and will not have as of the
Effective  Time an intention to  substantially  dispose of or  discontinue  such
active trade or business.  As of the date hereof (and as of the Effective Time),
the fair  market  value of Parent  is (and  will be) at least  equal to the fair
market value of the Company.  For purposes of the preceding  sentence,  the fair
market value of Parent will be  determined  under  Treasury  Regulation  Section
1.367(a)-3(c)(3)(iii)(B).  As of the date hereof (and as of the Effective Time),
other than  pursuant  to this  Agreement,  neither  Parent  nor any  corporation
related to Parent or Affiliates or  Subsidiaries  of the Parent owns or will own
beneficially  or of record  any  shares of  Company  stock or other  securities,
options,  warrants or instruments giving the holder thereof the right to acquire
Company stock or other securities issued by Company.  As of the date hereof (and
as of the Effective Time),  Merger Sub has (and will have) no liabilities (other
than as arise pursuant to the terms of this  Agreement)  that will be assumed by
the  Company,  and Merger Sub will not transfer any assets to the Company in the
Merger that are subject to any liabilities.

         Section  5.17  Ownership  of  Company  Stock;  Reorganization.  None of
Parent,  Merger Sub or any Subsidiary of Parent or Merger Sub (i) own any shares
of Company Stock;  (ii) will acquire any shares of Company Stock other than as a
result  of the  Merger  or (iii)  has  taken  any  action  or knows of any fact,
agreement,  plan or other  circumstances  that would  prevent  the  Merger  from
qualifying as a reorganization within the meaning of Section 368(a) of the Code.

         Section 5.18 No Other Representations or Warranties. Subject to Section
10.10 with  respect to claims for fraud and except for the  representations  and
warranties  contained  in  this  Agreement,   Parent  and  Merger  Sub  make  no
representation  or warranty,  expressed or implied,  written or oral, and Parent
and Merger Sub hereby to the maximum extent permitted by applicable law disclaim
any such  representation or warranty  (including without limitation any warranty
of merchantability or of fitness for a particular  purpose),  whether by Parent,
its  Subsidiaries  (including  Merger  Sub),  their  Affiliates  or any of their
officers,  directors,  employees, agents or representatives or any other Person,
with  respect  to Parent or Merger Sub or the  execution  and  delivery  of this
Agreement or the transactions contemplated hereby,  notwithstanding the delivery
or  disclosure  to the  Company,  any  Affiliate  of the Company or any of their
officers, directors, employees, agents or representatives or any other Person of
any documentation or other information by Parent or its Subsidiaries  (including
Merger Sub) or any of their Affiliates,  officers, directors,  employees, agents
or  representatives  or any other  Person with respect to any one or more of the
foregoing.

         Section 5.19  Customers.  Except as could not reasonably be expected to
have a Parent Material  Adverse  Effect,  Parent and its  Subsidiaries  have not
received any written notice, nor does Parent have any knowledge, that any of the
top five customers of Parent  (determined  on a consolidated  basis by revenues)
(i) have ceased, or will cease, to use products, goods and services of Parent or
its Subsidiaries or (ii) have materially reduced, or will materially reduce, the
use of products, goods or services of Parent or its Subsidiaries.


                                   ARTICLE VI

                    COVENANTS RELATING TO CONDUCT OF BUSINESS

         Section 6.1  Conduct of  Business  by the  Company  Pending the Merger.
Except as otherwise expressly  contemplated by this Agreement or as described in
Section 6.1 of the Company Disclosure Letter, during the period from the date of
this Agreement  through the Effective  Time, the Company shall,  and shall cause
its Subsidiaries to, use its commercially  reasonable  efforts to carry on their
respective businesses in, and not enter into any material transaction other than
in  accordance  with the regular and  ordinary  course,  preserve  intact  their
current business  organizations,  and, to the extent consistent therewith,  keep
available  the services of their  current  officers and  employees  and preserve
their  relationships  with  customers,  suppliers  and  others  having  business
dealings  with them.  Without  limiting the  generality of the  foregoing,  and,
except as otherwise expressly  contemplated by this Agreement or as described in
Section 6.1 of the Company Disclosure Letter, during the period from the date of
this Agreement  through the Effective Time, the Company shall not, and shall not
permit any of its Subsidiaries to, without the prior written consent of Parent:

         (a) (x) declare,  set aside or pay any  dividends on, or make any other
actual,  constructive or deemed  distributions in respect of, any of its capital
stock,  or otherwise make any payments to  stockholders  of the Company in their
capacity as such, other than dividends payable to the Company declared by any of
the Company's Subsidiaries,  (y) split, combine or reclassify any of its capital
stock or issue or authorize the issuance of any other  securities in respect of,
in lieu of or in  substitution  for shares of its capital stock or (z) purchase,
redeem or otherwise acquire any shares of capital stock of the Company or any of
its  Subsidiaries  or any other  securities  thereof or any rights,  warrants or
options to acquire any such shares or other securities;

         (b) issue, deliver,  sell, pledge (other than Permitted Liens), dispose
of or  otherwise  encumber  any shares of its capital  stock,  any other  voting
securities  or  equity   equivalent  or  any  securities   convertible  into  or
exchangeable or exercisable for, or any rights,  warrants or options to acquire,
any  such  shares,  voting  securities  or  convertible   securities  or  equity
equivalent  (other  than,  in the case of the  Company,  the issuance of Company
Common  Stock  during the period  from the date of this  Agreement  through  the
Effective Time upon the exercise of Stock Options  outstanding  (as set forth in
Section  4.2(a)) on the date of this Agreement in accordance  with their current
terms) or enter  into any  agreement  or  contract  with  respect to the sale or
issuance of any of its securities;

         (c)  except  with  respect  to   amendments  to  the   certificate   of
incorporation  of the  Company  set  forth  on  Section  6.1(c)  of the  Company
Disclosure  Letter,  amend its certificate of  incorporation or by-laws or amend
the certificate of incorporation and by-laws (or other organizational documents)
of any of its Subsidiaries;

         (d) acquire or agree to acquire by merging or consolidating with, or by
purchasing  assets of or equity in, or by any other manner,  any business or any
corporation, partnership, association or other business organization or division
thereof or otherwise  acquire or agree to acquire any assets  (other than in the
ordinary course of business consistent with past practice);

         (e) sell,  lease or  otherwise  dispose  of or agree to sell,  lease or
otherwise  dispose of, any of its assets that are material,  individually  or in
the aggregate, to the Company and its Subsidiaries taken as a whole;

         (f) incur any  indebtedness  for borrowed  money or guarantee  any such
indebtedness  or  issue  or sell  any  debt  securities  or  guarantee  any debt
securities of others,  except for (i)  borrowings or guarantees  incurred in the
ordinary  course of business  consistent  with past practice for working capital
purposes,  or (ii)  indebtedness of any Subsidiary of the Company to the Company
or to another  Subsidiary  of the Company,  in the  ordinary  course of business
consistent   with  past  practice  or  make  any  loans,   advances  or  capital
contributions to, or investments in, any other Person, other than to the Company
or any  wholly-owned  Subsidiary  of the Company and other than in the  ordinary
course of business consistent with past practice;

         (g) alter through merger, liquidation, reorganization, restructuring or
in any other fashion, the corporate structure or ownership of the Company or any
of its  Subsidiaries of the Company or adopt any plan with respect to any of the
foregoing;

         (h) grant any severance or termination pay not currently required to be
paid under existing severance plans, enter into or adopt, or amend any existing,
severance  plan,  agreement or arrangement or, other than in the ordinary course
of business or as required by applicable  law,  enter into or amend any employee
benefit plan (including  without  limitation,  the Company Stock Plan), or enter
into or amend any employment or consulting  agreement  which involves (i) annual
base payments of $150,000 or more and (ii) a term of at least one year;

         (i) except  for  capital  expenditures  contained  in the 2000  Capital
Expenditure  Plan, enter into any contract or commitment with respect to capital
expenditures with a value in excess of, or requiring expenditures by the Company
and its Subsidiaries in excess of $75,000, individually, or enter into contracts
or commitments with respect to capital  expenditures  with a value in excess of,
or  requiring  expenditures  by the  Company and its  Subsidiaries  in excess of
$300,000, in the aggregate;

         (j) except to the extent required under existing  employee and director
benefit  plans,  agreements  or  arrangements  as in  effect on the date of this
Agreement, increase the compensation or fringe benefits of any of its directors,
officers or  employees,  provided,  that with respect to employees  that are not
executive  officers or  directors  of the  Company,  the  Company  may  increase
compensation  associated  with  promotions  and regular  reviews in the ordinary
course of business consistent with past practice;

         (k) agree to the settlement of any material claim or litigation;

         (l) make or rescind any material  tax election or settle or  compromise
any material tax liability that would or may  materially  increase the liability
of the Company or any of its Subsidiaries for any period;

         (m) make any  material  change in its  method of  accounting  except as
required by applicable law or U.S. GAAP;

         (n) except as required  under the Company  Stock Plan and as  otherwise
provided in this Agreement,  take any action to accelerate the payment, right to
payment or vesting of any bonus, severance, profit sharing, retirement, deferred
compensation, stock option, insurance or other compensation or benefits;

         (o) other than items covered by paragraph (k) above, pay,  discharge or
satisfy any claims,  liabilities or obligations (absolute,  accrued, asserted or
unasserted,  contingent  or  otherwise),  other than the  payment,  discharge or
satisfaction (A) of any such claims,  liabilities or obligations in the ordinary
course  of  business  and  consistent  with  past  practice  or (B)  of  claims,
liabilities or obligations reflected or reserved against in, or contemplated by,
the Company Financial Statements (or the notes thereto);

         (p)  enter  into  any  agreement,   understanding  or  commitment  that
restrains,  limits or impedes the Company's or any of its Subsidiaries'  ability
to compete with or conduct any business or line of business,  including, but not
limited to, geographic  limitations on the Company's or any of its Subsidiaries'
activities;

         (q) materially amend or terminate any material  contract to which it is
a party or waive any of its  material  rights or claims  except in the  ordinary
course of business consistent with past practice; or

         (r)  agree,  in  writing  or  otherwise,  to take any of the  foregoing
actions.

         Section  6.2 No  Solicitation.  (a)  Neither the Company nor any of its
Subsidiaries  shall,  directly or  indirectly,  take (and the Company  shall not
authorize or permit its, or its Subsidiaries',  officers, directors,  employees,
financial  advisors,  attorneys and other advisors,  representatives and agents)
any action to (i) solicit, facilitate,  initiate or encourage the submission of,
any Takeover Proposal (as hereafter defined), (ii) enter into any agreement with
respect to any Takeover Proposal or enter into any arrangement, understanding or
agreement requiring it to abandon, terminate or fail to consummate the Merger or
any other transaction contemplated by this Agreement or (iii) participate in any
way in any  discussions  or  negotiations  regarding,  or  furnish to any Person
(other than Parent or Merger Sub) any  information  with respect to, or take any
other action to  facilitate  any  inquiries  or the making of any proposal  that
constitutes,  or may  reasonably be expected to lead to, any Takeover  Proposal.
"Takeover   Proposal"   shall  mean  any  proposed   merger  or  other  business
combination, sale or other disposition of any material amount of assets, sale of
shares of capital stock, tender offer or exchange offer or similar  transactions
involving the Company or any of its Subsidiaries or the Parent, as applicable.

         (b) Neither  the Board of  Directors  of the Company nor any  committee
thereof  shall (i)  withdraw or modify,  or propose to withdraw or modify,  in a
manner adverse to Parent or Merger Sub, the approval or  recommendation  by such
Board of  Directors or such  committee of the Merger and this  Agreement or (ii)
approve or recommend, or propose to approve or recommend,  any Takeover Proposal
or (iii)  cause the  Company to enter into any  letter of intent,  agreement  in
principle,  acquisition  agreement  or other  similar  agreement  related to any
Takeover Proposal.

         (c) In  addition  to  the  obligations  of the  Company  set  forth  in
paragraphs (a) and (b) of this Section 6.2, promptly after receipt thereof,  the
Company  shall advise  Parent in writing of any request for  information  or any
Takeover  Proposal,  or any inquiry,  proposal,  discussions or negotiation with
respect to any Takeover Proposal.

         (d) Immediately following the execution of this Agreement,  the Company
will cease any existing  discussions or negotiations  with any parties conducted
heretofore  with respect to any Takeover  Proposal and request each Person which
has  heretofore  executed a  confidentiality  agreement in  connection  with its
consideration  of  acquiring  the Company or any  portion  thereof to return all
confidential  information heretofore furnished to such Person by or on behalf of
the Company.

         Section 6.3 Third Party Confidentiality  Agreements.  During the period
from the date of this  Agreement  through the  Effective  Time,  (i) the Company
shall not terminate, amend, modify or waive any provision of any confidentiality
agreement  regarding a Takeover  Proposal to which the Company is a party (other
than any involving Parent),  and (ii) the Company shall enforce,  to the fullest
extent  permitted under  applicable law, the provisions of any such  agreements,
including,  but not limited to, obtaining injunctions to prevent any breaches of
such agreements and to enforce  specifically the terms and provisions thereof in
any court of the United States or any state thereof having jurisdiction.


                                   ARTICLE VII

                              ADDITIONAL AGREEMENTS

         Section  7.1  Access to  Information.  Each of the  Company  and Parent
shall,  and shall cause each of its  Subsidiaries to, afford to the other party,
and to the other  party's  accountants,  counsel,  financial  advisers and other
representatives,  reasonable  access and permit them to make such inspections as
they may  reasonably  request  during the period from the date of this Agreement
through the Effective Time to all their respective properties, books, contracts,
commitments and records and, during such period,  each of the Company and Parent
shall,  and shall cause each of its  Subsidiaries  to,  furnish  promptly to the
other party (i) a copy of each  report,  schedule,  registration  statement  and
other document filed by it during such period  pursuant to the  requirements  of
federal or state laws and (ii) all other  information  concerning  its business,
properties, clients and Personnel as Parent may reasonably request.

         Section 7.2 Actions for  Compliance  with  Securities  Laws. As soon as
practicable  after the date of this  Agreement,  Parent  and the  Company  shall
prepare the private placement  memorandum and shall take any other  commercially
reasonable action (other than qualifying as a foreign  corporation or taking any
action which would  subject it to service of process in any  jurisdiction  where
Parent is not now so qualified or subject) required to be taken under applicable
state blue sky or  securities  laws in  connection  with the  issuance of Parent
Shares in connection with the Merger.

         Section  7.3  Approval  of  Shareholders.  (a) As  soon  as  reasonably
practicable after the date hereof, Parent shall, through its Board of Directors,
duly call, give notice of, convene and hold an extraordinary  general meeting of
its shareholders (the "Parent Shareholders' Meeting"), for the purpose of voting
to approve the Merger in  accordance  with this  Agreement  and any  resolutions
necessary or  appropriate  to enable  Parent to implement  the same (the "Parent
Shareholders'  Approval").  Unless the Board of Directors of Parent,  based upon
the advice of their independent professional advisors, including legal advisors,
determines in good faith that making such  recommendation,  or failing to amend,
modify or withdraw any  previously  made  recommendation,  could  reasonably  be
expected to result in a breach of their fiduciary duties to shareholders imposed
by law, Parent shall include in the Circular the  recommendation of the Board of
Directors of Parent that the  shareholders  of Parent approve such matters,  and
shall use its  commercially  reasonable  efforts  to obtain  such  approval.  In
connection with the Parent Shareholders' Meeting, subject to applicable law, (i)
Parent shall,  as soon as  practicable  after the date of this  Agreement and in
accordance  with the Listing Rules,  prepare and submit to the UKLA for approval
the Circular and Listing Particulars,  and shall use its commercially reasonable
efforts  to  have  such  documents  formally  approved  by the  UKLA  and  shall
thereafter  publish the  Circular and the Listing  Particulars  and dispatch the
Circular and Listing  Particulars  to its  shareholders  in compliance  with all
legal  requirements  applicable  to the  Parent  Shareholders'  Meeting  and the
Listing Rules and (ii) if necessary  thereafter,  promptly  publish or circulate
amended,  supplemental or supplemented  materials and, if required in connection
therewith,  resolicit  votes.  Parent shall give the Company and its counsel the
opportunity to review the Circular and the Listing  Particulars  before the same
is published.  The Company agrees to cooperate with Parent in the preparation of
the Parent  Disclosure  Documents  including  providing  such  information  with
respect to the Company and its Subsidiaries as may be reasonably  required to be
disclosed therein.

         (b) The Company shall, through its Board of Directors,  duly call, give
notice of,  convene  and hold a meeting of its  stockholders  for the purpose of
voting on the  approval of the Merger in  accordance  with this  Agreement  (the
"Company  Stockholders'  Meeting") as soon as reasonably  practicable  after the
date  hereof.  In lieu of the  Company  Stockholders'  Meeting,  the Company may
provide a duly authorized written consent of its stockholders in accordance with
Section 228 of the Delaware General Corporation Law. The Company shall,  through
its Board of Directors,  include in any materials  delivered to the stockholders
of the Company the  recommendation of the Board of Directors of the Company that
the  stockholders  of the  Company  approve  such  matters,  and  shall  use its
commercially   reasonable   efforts  to  obtain  such   approval  (the  "Company
Stockholders' Approval").

         Section  7.4  Contingent  Payments .  Notwithstanding  anything  to the
contrary contained herein, Parent agrees that any shares of stock of the Company
issued to the  Contingent  Holders  shall have the right to vote in all  matters
subject to the general vote of the stockholders of the Company.

         Section 7.5 INTENTIONALLY LEFT BLANK.

         Section  7.6  Admission  of  Parent   Shares.   Parent  shall  use  its
commercially  reasonable  efforts,  and the Company  shall  cooperate in respect
thereto,  to procure the Admission of the Parent Shares to be issued pursuant to
the Merger on the date of the  Effective  Time;  and to procure the Admission of
all other Parent Shares to be issued  pursuant to this  Agreement on the date on
which such shares are issued.

         Section 7.7 Fees and Expenses.  (a) Subject to Section 7.7(b),  whether
or not the Merger is consummated,  all costs and expenses incurred in connection
with this Agreement and the  transactions  contemplated  hereby shall be paid by
the party incurring such costs and expenses, (including the payment by Parent of
any filing fee  associated  with the HSR Act) except as  expressly  set forth in
this Agreement.

         (b) In the event that this  Agreement is  terminated  and the Merger is
not  consummated  solely as a result of the (i) failure of Parent to receive the
Parent Shareholders'  Approval, (ii) failure of the Parent board of directors to
recommend  the Merger,  (iii)  failure of Parent to publish the  Circular or the
Listing Particulars or any required supplement thereto or (iv) failure of Parent
to receive approval of the Listing Particulars,  Parent shall pay to the Company
$2 million.

         (c) Parent  shall make any  payments  due under  Section  7.7(b)  above
promptly  (and in any event  within  five days of  receipt  by Parent of written
notice from the Company) by wire transfer of immediately  available  funds to an
account designated by the Company.

         Section 7.8 Commercially Reasonable Efforts. Upon the terms and subject
to the conditions set forth in this Agreement, each of the parties agrees to use
its commercially  reasonable efforts to take, or cause to be taken, all actions,
and to do, or cause to be done, and to assist and cooperate with the other party
in doing,  all things  necessary,  proper or  advisable to  consummate  and make
effective, in the most expeditious manner practicable, the Merger, and the other
transactions  contemplated  by  this  Agreement,  including  (a)  obtaining  all
necessary  actions  or  non-actions,   waivers,   consents  and  approvals  from
Governmental Entities and the making of all necessary  registrations and filings
(including filings with Governmental Entities, including without limitation, all
filings  under  the HSR Act) and the  taking of all  reasonable  steps as may be
necessary  to  obtain  an  approval  or  waiver  from or to avoid an  action  or
proceeding by any  Governmental  Entity,  (b) obtaining all necessary  consents,
approvals or waivers from third  parties,  (c)  defending  any lawsuits or other
legal  proceedings,   whether  judicial  or  administrative,   challenging  this
Agreement or the consummation of the transactions contemplated hereby, including
seeking to have any stay or temporary  restraining order entered by any court or
other Governmental Entity vacated or reversed,  and (d) executing and delivering
any additional instruments necessary to consummate the transactions contemplated
by this Agreement.

         Section 7.9 Public Announcements.  Except as and to the extent required
by applicable law or regulations, including without limitation the Listing Rules
and the Standards, without the prior written consent of the other party, none of
the Company,  Parent or their respective Subsidiaries will, and each will direct
its officers, directors, employees, agents, attorneys, accountants,  consultants
and financial advisors not to, make, directly or indirectly, any public comment,
statement,  or  communication  (each,  a  "Disclosure")  with  respect  to  this
Agreement or the  transactions  contemplated by this Agreement.  The Company and
Parent shall mutually agree upon the form and content of any Disclosure that may
be made with respect to this Agreement or the transactions  contemplated by this
Agreement and,  except as required by law or  regulation,  or by the UKLA or the
LSE, no such Disclosure shall be made unless mutually agreed upon by the parties
hereto.

         Section 7.10 Indemnification;  Directors' and Officers' Insurance.  (a)
From and after the Effective Time,  Parent agrees to, and to cause the Surviving
Corporation  to,  indemnify  and hold  harmless  all past and present  officers,
directors,  employees and agents of the Company and of its  Subsidiaries  to the
full extent such Persons have been  indemnified  by the Company  pursuant to the
Company's  Certificate of Incorporation  and by-laws as in effect as of the date
hereof for acts and omissions  occurring at or prior to the  Effective  Time and
shall advance expenses on the terms provided  therein.  The parties hereto agree
that the  officers,  directors,  employees  and  agents of the  Company  and its
Subsidiaries  covered by such  indemnification  are  intended to be  third-party
beneficiaries  under this  Section  7.10 and shall have the right to enforce the
obligations of Parent and the Surviving Corporation under this Section 7.10.

         (b) Parent will provide, or cause the Surviving Corporation to provide,
for a period of not less  than six  years  after  the  Effective  Time,  for the
benefit of the  Company's  current  directors  and  officers,  an insurance  and
indemnification  policy that provides  coverage for events occurring at or prior
to the Effective Time that is no less favorable than the existing  policy or, if
substantially  equivalent insurance coverage is unavailable,  the best available
coverage; provided, however, that Parent and the Surviving Corporation shall not
be required to pay an annual  premium for such insurance in excess of 1.50 times
the last annual  premium paid prior to the date  hereof,  but in such case shall
purchase as much of such coverage as possible for such amount.

         Section 7.11  Companies  Act Section 103.  Parent shall comply with its
obligations under Section 103 of the Companies Act (to the extent applicable) in
relation to the  allotment  of any Parent  Shares to be issued  pursuant to this
Agreement.

         Section 7.12 Dividends,  Distributions and Issuances. During the period
from the date of this Agreement through the Effective Time, Parent shall not (i)
declare,  set  aside or pay any  extraordinary  dividends  on, or make any other
extraordinary  distributions in respect of, any of its capital stock, except for
ordinary cash dividends on Parent Shares consistent with past practice,  or (ii)
split, combine or reclassify or otherwise materially alter the Parent Shares.

         Section 7.13 Employee  Benefit Plans.  Parent agrees that, for a period
of at least 2 years  following the Closing Date, it shall, or it shall cause its
Subsidiaries  to,  provide  the  eligible  employees  of  the  Company  and  its
Subsidiaries with employee compensation and benefit plans, programs and policies
that will provide a level of benefits to eligible employees of the Companies and
its  Subsidiaries  that  are,  as  the  of  the  Effective  Time,  substantially
comparable in the aggregate to the level of benefits  received by the applicable
United  States or United  Kingdom  employees  of the  Parent  who are of similar
position or rank as the eligible employees of the Company and its Subsidiaries.

         Section 7.14 Registration  Rights. (a) Parent shall,  within 5 Business
Days following the Closing,  use its reasonable best efforts to prepare and file
a "shelf" registration statement (a "Shelf Registration") covering the resale of
the Parent Shares to be issued to each of the  stockholders  of the Company (the
"Stockholders")  at the Closing,  and thereafter Parent shall use its reasonable
best efforts to cause such registration statement to become effective,  and (ii)
Parent  shall use its  reasonable  best  efforts to keep the Shelf  Registration
continuously effective until the earlier of such time as all of such shares have
been  disposed of or two years  after the  Effective  Time.  Parent will use its
reasonable best efforts to effect such qualifications  under applicable Blue Sky
or  other  state  securities  laws  as  may  be  reasonably   requested  by  the
Stockholders  (provided  that Parent  shall not be  obligated  to file a general
consent to service of process or qualify to do business as a foreign corporation
or  otherwise  subject  itself to  taxation in any  jurisdiction  solely for the
purpose of any such  qualification)  to permit or  facilitate  the sale or other
distribution  of the Parent Shares to be registered  hereunder (the  "Registered
Securities").  In connection with the Shelf Registration,  each Stockholder will
furnish to Parent in writing such information as Parent reasonably  requests for
use in connection with the Shelf  Registration or the Final Prospectus  (defined
below).

         (b) Subject to the other  provisions of Section 7.14, each  Stockholder
agrees  that  he or it  will  only  make  offers  to sell  and  sell  Registered
Securities with a final  prospectus  ("Final  Prospectus")  which is part of the
effective Shelf  Registration or pursuant to another  applicable  exemption from
registration.

         (c) Parent shall furnish to each  Stockholder  such number of copies of
the Final Prospectus and any amendment or supplement  thereto as the Stockholder
may reasonably request in order to effect the sale of the Registered  Securities
to be offered and sold by the Stockholder, but only while the Parent is required
to cause the Shelf Registration to remain current.

         (d) Parent shall afford the Stockholders and their  representatives the
opportunity  at  reasonable  times  and in a  reasonable  manner  to  make  such
reasonable  examination and inquire into the financial condition and business of
Parent and its  affiliates as the  Stockholders'  counsel may deem  necessary or
prudent in connection with the preparation of the Shelf Registration.

         (e) Anything in this Agreement to the contrary notwithstanding,  Parent
shall be entitled  at any time after  December  2000 to postpone  for one 90 day
period in any 365 day period (a "Blackout  Period") the filing of any amendments
or  supplements  that Parent  reasonably  determines  are required for the Shelf
Registration or Final  Prospectus to comply with all applicable  securities laws
if Parent  reasonably  determines  that any such filing would  impede,  delay or
interfere  with  any  financing,  offer  or  sale  of  securities,  acquisition,
corporate  reorganization or other significant  transaction  involving Parent or
any of' its  Affiliates,  or require  disclosure of material  information  which
Parent has a bona fide business  purpose for  preserving as  confidential.  Upon
notice  by  Parent  to the  Stockholders  of  such  determination,  each  of the
Stockholders  covenants that he or it shall (i) keep the fact of any such notice
strictly  confidential,  (ii) promptly halt any offer, sale, trading or transfer
by him or it or any of his or its Affiliates of any of the Registered Securities
until Parent has notified the  Stockholders  that the Blackout  Period has ended
and (iii) promptly halt any use,  publication,  dissemination or distribution of
the Shelf Registration,  the Final Prospectus included therein and any amendment
or  supplement  thereto  by him or it and any of his or its  Affiliates  for the
duration of the Blackout Period.  Parent will, as promptly as practicable  after
the  Blackout  Period,  take such  actions as may be  necessary to file and have
declared   effective   any  required   amendment  or  supplement  to  the  Shelf
Registration  or  Final  Prospectus.   Parent  agrees  to  promptly  notify  the
Stockholders of the ending of any Blackout Period.

         (f) Parent will bear all expenses of any Shelf Registration pursuant to
this  Section  7.14 (other  than  underwriters'  commissions  and  expenses  and
brokerage  commissions  and fees,  if any,  payable with  respect to  Registered
Securities  sold by the  Stockholders  and fees and  expenses  of  counsel,  any
accountants or any experts for the Stockholders), including, without limitation,
registration fees,  printing  expenses,  expenses of compliance with Blue Sky or
other  state  securities  laws,  and legal and audit fees  incurred by Parent in
connection  with such  Shelf  Registration  and  amendments  or  supplements  in
connection therewith.

         (g) (i) Parent will notify the Stockholders  promptly of (A) any action
by  the  SEC  to  suspend  the  effectiveness  of a  Shelf  Registration  or the
institution  or  threatening of any proceeding for such purpose (a "stop order")
or (B) the receipt by Parent of any notification  with respect to the suspension
of the  qualification of the Registered  Securities for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose. Immediately
upon receipt of any such notice,  the Stockholders  shall cease to offer or sell
any Registered Securities pursuant to the Shelf Registration in the jurisdiction
to which such stop order or suspension  relates.  Parent will use all reasonable
efforts to prevent the issuance of any such stop order or the  suspension of any
such  qualification  and,  if  any  such  stop  order  is  issued  or  any  such
qualification  is  suspended,  to obtain as soon as possible the  withdrawal  or
revocation thereof, and will notify the Stockholders at the earliest practicable
date of the  date on which  the  Stockholders  may  offer  and  sell  Registered
Securities  pursuant  to the Shelf  Registration.  (ii)  Parent  will notify the
Stockholders  promptly of the  occurrence  of any event or the  existence of any
state of facts that, in the judgment of Parent, should be set forth in the Shelf
Registration  or Final  Prospectus  such  that the Shelf  Registration  or Final
Prospectus  could  not  then be  available  for  the  resale  of the  Registered
Securities.  Immediately  upon receipt of such notice,  the  Stockholders  shall
cease  to  offer  or  sell  any  Registered  Securities  pursuant  to the  Shelf
Registration  and the  Final  Prospectus,  cease  to  deliver  or use the  Shelf
Registration and the Final Prospectus and, if so requested by Parent,  return to
Parent,  at its expense,  all copies (other than  permanent  file copies) of the
Shelf  Registration  and Final  Prospectus.  Subject  to the  Parent's  right to
declare a Blackout  Period,  Parent will, as promptly as practicable,  take such
action as may be  necessary to amend or  supplement  the Shelf  Registration  in
order to set forth or reflect such event or state of facts.  Parent will furnish
copies of such proposed amendment or supplement to the Stockholders.

         (h) The  Parent  agrees  to  indemnify  and hold  harmless  each of the
Stockholders  and each person,  if any,  who  controls  any Company  Stockholder
within the meaning of the Securities  Act,  against any and all losses,  claims,
damages,  liabilities or expenses,  joint or several, to which such Stockholders
or such  controlling  person may become  subject,  under the Securities Act, the
Exchange Act, or any other federal or state  statutory law or regulation,  or at
common law or otherwise  (including  in settlement  of any  litigation,  if such
settlement  is effected  with the written  consent of the Parent,  which consent
shall not be unreasonably  withheld),  insofar as such losses, claims,  damages,
liabilities or expenses (or actions in respect  thereof as  contemplated  below)
arise out of or are based upon any untrue  statement or alleged untrue statement
of any material fact  contained in the  registration  statement on Form F-3 (the
"Registration  Statement"),  including the prospectus,  financial statements and
schedules,  and all other documents  filed as a part thereof,  as amended at the
time of effectiveness of the Registration  Statement,  including any information
deemed  to be a part  thereof  as of  the  time  of  effectiveness  pursuant  to
paragraph  (b) of  Rule  430A,  or  pursuant  to  Rule  434,  of the  Rules  and
Regulations, or the prospectus, in the form first filed with the SEC pursuant to
Rule 424(b) of the Regulations,  or filed as part of the Registration  Statement
at the  time  of  effectiveness  if no  Rule  424(b)  filing  is  required  (the
"Prospectus"),  or any amendment or supplement  thereto,  or arise out of or are
based upon the  omission or alleged  omission to state in any of them a material
fact required to be stated therein or necessary to make the statements in any of
them, in light of the  circumstances  under which they were made, not misleading
(collectively  referred to herein as a  "Violation"),  and will  reimburse  each
Stockholder and each such controlling person for any legal and other expenses as
such expenses are reasonably  incurred by such  Stockholders or such controlling
person in connection with investigating,  defending,  settling,  compromising or
paying any such loss, claim,  damage,  liability,  expense or action;  provided,
however,  that Parent will not be liable in any such case to the extent that any
such loss, claim, damage, liability or expense arises out of or is based upon an
untrue  statement or alleged  untrue  statement or omission or alleged  omission
made in the  Registration  Statement,  the Final  Prospectus or any amendment or
supplement  thereto in reliance upon and in conformity with written  information
furnished  to  Parent,  by or on behalf of the  Stockholders  expressly  for use
therein and; provided further, that the Parent will not be required to indemnify
any of the  foregoing  Persons  on  account of any  losses,  claims,  damages or
liabilities  arising from a Violation  if and to the extent that such  Violation
was  made  in a  preliminary  prospectus  and  was  corrected  in  a  subsequent
prospectus  that was required by law to be  delivered  to the Person  making the
claim  with  respect  to which  indemnification  is sought  hereunder  (and such
subsequent prospectus was delivered by the Company to the Stockholders to permit
delivery of such prospectus in a timely manner), and such subsequent  prospectus
was not so  delivered  to such  Person.  The  parties  hereto  intend  for  this
indemnification  to  be a  separate  and  distinct  obligation  from  the  other
indemnification  obligations  contained  herein  and  that  the  limitations  on
indemnification  contained  in  Section  10.5  shall  be  inapplicable  to  this
indemnification.


                                  ARTICLE VIII

                                   Tax Matters

         Section  8.1  Certain  Tax  Covenants.  The  Company  and  each  of its
Subsidiaries agree that, from and after the date of this Agreement and until the
Closing Date,  (i) to prepare all Returns in a manner which is  consistent  with
the past practices of the Company and each Subsidiary,  as the case may be, with
respect to the treatment of items on such Returns  except to the extent that any
inconsistency  (x)  would  not or may  not  materially  increase  Parent's,  the
Company's,  the Surviving  Corporation's or any Subsidiary's liability for Taxes
for any period or (y) is required by law;  (ii) to refrain  from  incurring  any
material  liability  for Taxes other than in the  ordinary  course of  business;
(iii) to refrain from entering into any  settlement or closing  agreement with a
taxing  authority that materially  increases or may materially  increase the Tax
liability of the Company or any of its  Subsidiaries  for any period without the
consent of Parent, which consent shall not be unreasonably  withheld or delayed,
except as required by law.  Parent  agrees that after the Closing  Date,  (i) it
shall cause the Returns of Company and each of its  Subsidiaries  to be prepared
in a manner which is consistent  with the past practices of the Company and each
Subsidiary,  as the case may be, with respect to the  treatment of items on such
Returns,  except to the extent that any  inconsistency  (x) would not materially
increase  Company's  or any of its  Subsidiary's  Tax  liability  with respect a
Pre-Closing  Period or (y) is required by law, and (ii) to refrain from entering
into any settlement or closing agreement with a taxing authority that materially
adversely  affects the Tax liability of the Company and its Subsidiaries for any
Pre-Closing Period,  without the consent of Stockholders which consent shall not
be unreasonably withheld or delayed, except as required by law.

         Section 8.2 Tax  Indemnification.  (a) Notwithstanding any provision to
the contrary  contained in this Agreement  except for Section  8.2(b),  the last
sentence of Section 10.2(a),  and clause (y) (including the provisos thereto) of
Section 10.5, and Sections 10.6,  10.7, 10.8 and 10.10,  the stockholders of the
Company shall severally (and not jointly),  in proportion to the Prior Ownership
Allocation, agree, as Stockholder Indemnitors' (as defined herein), to indemnify
defend and hold harmless Parent,  Merger Sub, the Surviving  Corporation,  their
Affiliates  (including the Company and its  Subsidiaries)  and the successors to
the foregoing (and their respective shareholders, officers, directors, employees
and agents) on an after-tax basis (without  duplication)  against (i) all Taxes,
losses,  claims and expenses  resulting  from,  arising out of, or incurred with
respect  to,  any  claims  that  may  be  asserted  by  any  party  based  upon,
attributable to, or resulting from the failure of any representation or warranty
made  pursuant  to Section  4.17  (other  than  Section  4.17(a) or (b)) of this
Agreement to be true and correct as of the Closing Date;  (ii) all Taxes imposed
on or asserted  against the  properties,  income or operations of the Company or
its  Subsidiaries,  or for  which the  Company  or any of its  Subsidiaries  may
otherwise be liable,  for all Pre-Closing  Periods  (including,  with respect to
taxable  periods that begin prior to and end after the Closing Date, the portion
of such taxable  periods up to and including the Closing  Date),  except for (x)
Taxes accrued and fully  provided for in  accordance  with GAAP on the unaudited
consolidated  balance  sheet of the  Company  as of April  30,  2000,  (y) Taxes
imposed or asserted against the properties,  income or operations of the Company
or its  Subsidiaries  or for which the  Company or any of its  Subsidiaries  may
otherwise be liable as a result of the conduct of operations  (including holding
of  property)  in  the  ordinary  course  of  business  of  the  Company  or its
Subsidiaries after April 30, 2000 that are (i) paid or discharged by the Company
prior to the  Effective  Time or (ii) not yet due and  payable at the  Effective
Time or (z)  incurred by the Company or its  Subsidiaries  outside the  ordinary
course of  business  but only to the extent and such Tax is incurred as a result
of a  transaction(s)  occurring at the  direction  of the Parent,  and (iii) all
Taxes  imposed  on Parent,  Merger  Sub,  the  Surviving  Corporation  and their
Affiliates (including the Company or any Subsidiary) or for which Parent, Merger
Sub, the Surviving  Corporation and their  Affiliates  (including the Company or
any  Subsidiary)  becomes  liable  (other  than  Taxes  of the  Company  and its
Subsidiaries) under Section 1.1502-6 of the Treasury  Regulations or any similar
provision  of state,  local or foreign  law as a result of the Company or any of
its  Subsidiaries  being a member  prior to the Closing  Date of an  affiliated,
combined,  consolidated  or  unitary  group  of  corporations.  Nothing  in this
agreement  shall be construed  as a guarantee of the  existence or amount of any
loss, credit, carryforward,  basis or other tax attribute, whether past, present
or future of the Company or any  Subsidiary,  and any  reduction  in whole or in
part of any such  tax  attributes  shall  not  give  rise to an  indemnification
obligation by the Stockholder Indemnitors under this Agreement.

         (b) The  stockholders  of the  Company  shall  be  under  no  liability
pursuant to this  section 8.2 or  pursuant to any  representations,  warranties,
obligations or indemnities contained in this Agreement and relating to UK Taxes,
in respect of any UK Taxes or any losses,  claims and  expenses in respect of UK
Taxes to the extent that:

         (i)  provision  or  reserve  therefor  has been  made in the  unaudited
consolidated balance sheet of the Company as of April 30, 2000;

         (ii) it arises out of a transaction,  act, omission or event occurring,
or in respect of income profit or gains earned, accrued or received, after April
30, 2000 but before Closing in the ordinary course of business of the Company or
any of the Subsidiaries;

         (iii) it was paid or discharged before Closing;

         (iv)  it  arises  as a  result  of any  change  in law,  rates  of tax,
statutes,  regulations,   practice,  concession  or  directive  occurring  after
Closing;

         (v) it would not have  arisen but for a voluntary  transaction,  act or
omission  carried out or effected or occurring  at any time after  Closing by or
affecting any of the Company,  the Subsidiaries,  the Parent or any other person
connected  with any of them,  which the  Parent,  the  Company  or the  relevant
Subsidiary  knew or ought  reasonably  to have been aware would give rise to the
liability or increased liability, other than to the extent any such transaction,
act or omission  is carried  out or effected by the Company or its  Subsidiaries
pursuant to a legally binding commitment created on or before Closing;

         (vi) it arises as a result of a change  (other  than to comply with law
or with generally accepted  accounting  practice as at Closing) after Closing in
any accounting policy or practice or the length of any accounting period for tax
purposes of the Company or any of the Subsidiaries;

         (vii) the Parent, the Company or any Subsidiary has a right of recovery
in  respect  thereof  from a person or  persons  other  than the  Company or its
Subsidiaries but only to the extent that such right is successfully enforced;

         (viii) it arises or is increased by reason of a breach by the Parent of
the provisions of this Agreement;

         (ix) it can be relieved or mitigated by the use of any losses, reliefs,
allowances, exemption set off or credits in computing or against income profits,
gains or Taxes,  arising in respect of a period or an event,  act,  omission  or
transaction  occurring prior to Closing other than one treated as an asset or as
reducing a provision in the unaudited  consolidated balance sheet of the Company
as of April 30, 2000; or

         (x) it arises in  respect  of a  transaction,  act,  omission  or event
occurring  after  April 30,  2000 but  before  Closing  or in  respect of income
profits or gains  earned,  accrued or  received  since April 30, 2000 but before
Closing, to the extent that the consideration actually earned, accrued, received
or receivable in relation  thereto is greater than the  consideration  deemed to
have been  earned,  accrued,  received  or  receivable  for the  purposes of the
relevant Taxes.

         (c) Any  payment by the  stockholders  hereunder  shall,  to the extent
permitted  by  applicable   law,  be  treated  as  a  reduction  in  the  Merger
Consideration.

         Section 8.3 Transfer Taxes.  All transfer,  sales and use, value added,
registration,  documentary,  stamp and similar Taxes imposed in connection  with
the  exchange of the Parent  Shares for Company  Stock or any other  transaction
that  occurs  pursuant  to this  Agreement  shall be borne by the party  that is
primarily  liable for such tax under  applicable law.  Notwithstanding  anything
herein to the contrary,  Parent and/or Merger Sub and their  affiliates will pay
or assume only those  expenses or  liabilities  of the Company and  Stockholders
that are  solely and  directly  related  to the  Merger in  accordance  with the
guidelines of Rev. Rul. 73-54,  1973-1 C.B.187.  Otherwise  Parent,  Merger Sub,
Company, and Stockholders each will pay their own expenses,  if any, incurred in
connection  with the  Merger  and any other  transactions  contemplated  by this
Agreement.

         Section 8.4 Amended  Returns.  Neither Parent,  the stockholders of the
Company  nor the Company  shall file or cause to be filed any amended  Return or
claims  for  refund  with  respect to the  Company  or its  Subsidiaries,  for a
Pre-Closing  Period without the prior written  consent of Parent and Stockholder
Indemnitors' Representative, which consent shall not be unreasonably withheld or
delayed.  In no event shall the  stockholders of the Company file or cause to be
filed any amended Return or claim for refund with respect to the Company for any
period that begins on or after the Closing Date.

         Section  8.5   Carrybacks.   Without  the  prior  written   consent  of
Stockholder Indemnitors' Representative, which consent shall not be unreasonably
withheld or delayed, none of Parent,  Company or any Subsidiary of Company shall
carry back any net operating loss or other item or attribute from a Post-Closing
Period  to  a  Pre-Closing  Period.   Parent  and  Company  agree  to  reimburse
stockholders of Company for any reasonable  out-of-pocket costs incurred by such
stockholders  connected  therewith,  including,  but not limited to,  reasonable
out-of-pocket  costs of time spent by  independent  accountants  preparing  such
carryback  returns and any  adjustment to Taxes for which the  stockholders  are
liable hereunder.

         Section 8.6 Tax  Covenants  Regarding  Merger.  Following  the Closing,
neither Parent, Sub nor the Surviving Corporation shall take any action or cause
any action to be taken, which action is (i) in violation of the undertakings set
forth in the representations and warranties provided by Parent and Merger Sub to
the  Company's  counsel in connection  with the opinion  rendered to the Company
pursuant to Section 9.3(c) or (ii) outside the ordinary  course of business that
a reasonable  person after  reasonable  inquiry  would  believe  would cause the
Merger to fail to be treated as a  reorganization  within the meaning of Section
368(a) of the Code.  After the Effective  Time,  Parent agrees to take all steps
required to ensure that the  Surviving  Company  will comply with the  reporting
requirements  described in U.S. Treasury  Regulations Section  1.367(a)-3(c)(6).
Parent also agrees to provide to the Surviving Company and any other person that
is a holder of shares of Company Stock  immediately  prior to the Effective Time
that may have tax reporting  obligations  (including reporting obligations under
Section 6038B of the Code) with respect to any transactions effected pursuant to
this  Agreement,  any  information  necessary  to comply with the tax  reporting
requirements  (including the filing  requirements  of Section 6038B and the U.S.
Treasury Regulations promulgated thereunder). In addition, prior to December 31,
2006, Parent will neither  transfer,  sell or otherwise dispose of any shares of
capital  stock of the  Company,  other than a  transfer  to a  Subsidiary  or an
Affiliate  of  Parent  so  long  as  such  transfer  is  described  in  Treasury
Regulations Section 1.367(a)-8(g)(2) and Parent provides the Shareholder Parties
(as  defined  below)  within  15 days  of such  transfer  with  the  information
necessary  to comply  with the  requirements  of  Treasury  Regulation  Sections
1.367(a)-8(g)(2)(ii) through (iv), nor permit a "deemed disposition" of any such
shares  within the meaning of  Treasury  Regulations  Section  1.367(a)-8(e)(3).
Parent  agrees to report the breach of any  covenant of this  Section 8.6 to any
holder of shares of Company Common Stock that, solely as a result of the receipt
of the Merger  Consideration at the Effective Time, becomes the beneficial owner
of 5% or more of Parent Shares (collectively,  the "Shareholder Parties") within
15 days of such breach.

         Section 8.7 Tax Cooperation.  After the Closing Date,  Parent,  Company
and Subsidiaries, on the one hand, and Stockholders, on the other hand, agree to
furnish or cause to be furnished  to each other,  upon  request,  as promptly as
practicable,  such  information  and  assistance  (including  access  to  books,
records, work papers and Pre-Closing Period Returns) relating to the Company and
its  Subsidiaries  and shall make available  (during normal business hours) such
knowledgeable  employees of Parent,  Company or any of Company's Subsidiaries as
is reasonably  necessary for the preparation of any Return,  claim for refund or
audit, and the prosecution or defense of any claim, suit or proceeding  relating
to any  proposed  Tax  adjustment.  For a period of seven years from the Closing
Date, Parent shall maintain and make available (during normal business hours) to
Stockholder Indemnitors,  on Stockholder Indemnitors' reasonable request, copies
(at the sole expense of  Stockholder  Indemnitors)  of any and all  information,
books,  and  records  referred to in this  Section  8.8.  After such  seven-year
period, Parent,  Companies and its Subsidiaries may dispose of such information,
books and records  provided  that prior to such  disposition,  Parent shall give
Stockholders  Indemnitor's  Representative the opportunity to take possession of
such information, books and records.

         Section 8.8 Tax Controversies. Parent shall promptly notify Stockholder
Indemnitors'  Representative  upon receipt by Parent or any  Affiliate of Parent
(including the Company and its  Subsidiaries  after the Closing Date) of written
notice of any  inquiries,  claims,  assessments,  audits or similar  events with
respect to Taxes  relating to (i) a taxable  period ending prior to or ending on
and  including  the Closing  Date or (ii) other  item(s)  for which  Stockholder
Indemnitors  may be liable or obligated to indemnify  under  Section 8.2. If the
item(s)  discussed in such notice(s)  would (either alone,  or together with any
previous or other current claims,  assessments or similar items), if resolved to
the  detriment  of  the  Company  or  any  Subsidiary  or  other  Persons  which
Stockholder  Indemnitors are obligated to indemnify under Section 8.2, result in
an assessment  for Taxes,  in the aggregate,  in excess of $1,000,000  (any such
inquiry, claim, assessment,  audit or similar event, to the extent relating to a
taxable  period  ending prior to or ending on and including the Closing Date and
in   excess   of   $1,000,000   a  "Tax   Matter"),   Stockholder   Indemnitors'
Representative, at the sole expense of Stockholders, shall have the authority to
represent  the  interests of the Company and its  Subsidiaries  or other Persons
which  Stockholder  Indemnitor are obligated to indemnify under Section 8.2 with
respect to such Tax Matter before the Internal Revenue Service, any other taxing
authority,  any other  governmental  agency or  authority or any court and shall
have the right to control the defense,  compromise  or other  resolution of such
Tax Matter, including responding to inquiries and contesting,  defending against
and resolving any assessment for additional Taxes or notice of Tax deficiency or
other adjustment of Taxes of, or relating to, a Tax Matter;  provided,  however,
that  none  of  Stockholder  Indemnitors'  Representative,  the  Company  or any
Subsidiary  shall enter into any settlement of or otherwise  compromise any such
Tax Matter that affects or may affect the Tax  liability of Parent,  Merger Sub,
the Surviving  Corporation  or any of its  Subsidiaries  or any Affiliate of the
foregoing for any period ending after the Closing Date (including,  with respect
to any  taxable  year or period  that  begins  before and ends after the Closing
Date,  the portion such period that is after the Closing Date) without the prior
written consent of Parent,  which consent shall not be unreasonably  withheld or
delayed.  Stockholder  Indemnitors'  Representative  shall keep Parent fully and
timely informed with respect to the  commencement,  status and nature of any Tax
Matter.  Stockholder  Indemnitors'  Representative shall, in good faith, consult
with Parent  regarding the conduct of or positions taken in any such proceeding.
Except as set forth in the  preceding  provisions  of this Section  8.8,  Parent
shall have the sole right to represent the  interests of the Company,  Surviving
Corporation  and  its  Subsidiaries  with  respect  to  any  inquiries,  claims,
assessments,  audits or similar  events  with  respect to Taxes for all  taxable
periods;  provided,  however,  Parent shall not, and shall cause its  Affiliates
(including the Company and its Subsidiaries) not to enter into any settlement of
any contest or otherwise  compromise any such audit or other Tax proceeding with
respect to (i) any taxable year or period ending on or prior to the Closing Date
(ii) or other  item(s)  for  which  Stockholder  Indemnitors  may be  liable  or
obligated  to  indemnify  under  Section  8.2, to the extent that the  aggregate
liability  incurred under all such  settlements  and  compromises  and any prior
payments  that  count  against  the  Tax  Threshold  are  greater  than  the Tax
Threshold,  without  the  prior  written  consent  of  Stockholder  Indemnitors'
Representative, which consent shall not be unreasonably withheld or delayed.

         Section 8.9 Survival of Tax Covenants.  Notwithstanding anything herein
to the contrary,  the representations,  warranties and covenants of the Company,
Merger Sub, and Parent  contained in Sections 4.17, 5.12, 5.16, 5.17 and Article
VIII  shall  survive  until  the  expiration  of  the   applicable   statute  of
limitations.


                                   ARTICLE IX

                              CONDITIONS PRECEDENT

         Section 9.1 Conditions to Each Party's Obligation to Effect the Merger.
The  respective  obligations of each party to effect the Merger shall be subject
to  the  fulfillment  at or  prior  to  the  Effective  Time  of  the  following
conditions:

         (a) Stockholder  Approval.  The Company shall have received the Company
Stockholders'   Approval  and  the  Parent   shall  have   received  the  Parent
Shareholders' Approval.

         (b) [Intentionally left blank]

         (c)  Admission.  All necessary  approvals of the UKLA and the LSE shall
have been  obtained for the  Admission of the new Parent  Shares to be issued in
the Merger on the date of the Effective  Time,  subject only to the allotment of
such shares and  immediately  prior to the filing of the Merger  Certificate  no
action shall have been taken or notice given by the UKLA or the LSE and no event
shall otherwise have occurred,  which will or is reasonably  likely to result in
such Admission not to become effective on the date of the Effective Time.

         (d) HSR Act. Any waiting period (and any extension thereof)  applicable
to the  consummation  of the Merger under the HSR Act shall have expired or been
terminated.

         (e)  Injunctions or Restraints.  No court of competent  jurisdiction or
other competent Governmental or Regulatory Authority shall have enacted, issued,
promulgated,   enforced  or  entered  any  law  or  order  (whether   temporary,
preliminary  or permanent)  which is then in effect and has the effect of making
illegal or otherwise restricting,  preventing or prohibiting consummation of the
Merger or the other transactions contemplated by this Agreement.

         (f) H.M.  Treasury  Consent.  Parent (as required)  shall have received
consent  from  H.M.  Treasury  pursuant  to  Section  765 of the UK  Income  and
Corporation  Taxes  Act 1988 in  respect  of the  Merger  and any  other  matter
contemplated hereby, or confirmation that no consent is required.

         (g) Governmental and Regulatory Consents and Approvals.  Other than the
filings  provided for by Section 2.2, all  consents,  approvals  and actions of,
filings with and notices to any Governmental or Regulatory  Authority (including
under the HSR Act)  required of Parent,  the Company or any of their  respective
Subsidiaries to consummate the Merger and the other matters  contemplated hereby
shall have been made or obtained  (as the case may be) and become  Final  Orders
(as  defined  in  this  Section  below),   and  such  Final  Orders  shall  not,
individually  or in the aggregate,  contain terms or conditions that would have,
or could  reasonably  be  expected  to have,  a Material  Adverse  Effect on the
Surviving  Corporation and its  Subsidiaries,  taken as a whole. A "Final Order"
means an action by the relevant  Governmental  or Regulatory  Authority that has
not been reversed,  stayed,  enjoined,  set aside,  annulled or suspended,  with
respect to which any waiting  period  prescribed  by  applicable  law before the
transactions contemplated hereby may be consummated has expired, and as to which
all conditions to the consummation of such transactions prescribed by applicable
law, regulation or order have been satisfied.

         (h) UK Fair Trading Act. Any of:

         (i) the Office of Fair Trading (the "OFT") shall not have  indicated in
    writing that the  Secretary  of State for Trade and Industry  (the "SOS") in
    the  exercise  of his powers  under the Fair  Trading  Act 1973 (the  "FTA")
    intends  to  refer  the  Merger  or  any  matter  relating  thereto  to  the
    Competition Commission ("COC"); or

         (ii) in the event of an COC  reference,  the COC shall  have  concluded
    that the  Merger  does not or may not be  expected  to operate  against  the
    public interest; or

         (iii) if on a reference  the COC shall have  concluded  that the Merger
    does or may be expected  to operate  against  the public  interest,  the SOS
    shall have  indicated  in writing  that it is his  intention  to approve the
    Merger,

PROVIDED that if any  indication by the SOS referred to in (i) or (iii) above is
subject to  undertakings,  assurances,  or any other terms or  conditions,  such
undertakings,   assurances,  terms  or  conditions  would  not  have,  or  could
reasonably be expected not to,  individually or in the aggregate,  have a Parent
Material Adverse Effect.

         (i) Other  Consents  And  Approvals.  The  consent or  approval of each
Person  (other than a  Governmental  or Regulatory  Authority)  whose consent or
approval is required of Parent,  the Company or any of their  Subsidiaries under
any  Contract  in order to  consummate  the  Merger  and the other  transactions
contemplated  hereby  shall have been  obtained,  except for those  consents and
approvals  which,  if not obtained,  would not have, or could not  reasonably be
expected to have, a Parent  Material  Adverse Effect or on the ability of Parent
or the Company to consummate the transactions contemplated hereby.

         Section 9.2 Conditions to Obligation of Parent And Merger Sub to Effect
the  Merger.  The  obligation  of Parent  and Merger Sub to effect the Merger is
further subject to the  fulfillment,  at or prior to the Effective Time, of each
of the  following  additional  conditions  (all or any of which may be waived in
whole or in part by Parent and Merger Sub in their sole discretion):

         (a)  Representations  and  Warranties.   (A)  The  representations  and
warranties  of the  Company  contained  herein that are  qualified  by a Company
Material  Adverse Effect and the  representations  and  warranties  contained in
Section 4.5 shall be true and correct  when made and on the Closing Date (except
for  representations  and warranties made as of a specified date,  which need be
true and correct only as of the  specified  date),  as if made on and as of such
date and (B) all other  representations and warranties of the Company shall have
been true and correct  when made and on and as of the Closing  Date  (except for
representations  and warranties made as of a specified date,  which need be true
and correct  only as of the  specified  date) as if made on and as of such date,
except where the failure of such  representations  and  warranties to be so true
and  correct  could  not  reasonably  be  expected  to,  individually  or in the
aggregate,  have a Company Material  Adverse Effect,  and the Company shall have
delivered  to Parent a  certificate,  dated the Closing Date and executed in the
name and on behalf of the Company by its Chairman of the Board,  Chief Executive
Officer or President, to such effect.

         (b)  Performance of  Obligations.  The Company shall have performed and
complied  with,  in  all  material  respects,  the  agreements,   covenants  and
obligations  which are required by this Agreement to be so performed or complied
with by the  Company  at or prior to the  Closing,  and the  Company  shall have
delivered  to Parent a  certificate,  dated the Closing Date and executed in the
name and on behalf of the Company by its Chairman of the Board,  Chief Executive
Officer or President, to such effect.

         (c) Material  Adverse Effect.  No Company Material Adverse Effect shall
have occurred and there shall exist no facts or circumstances  arising after the
date of this Agreement,  which in the aggregate  would, or insofar as reasonably
can be foreseen,  could  reasonably be expected to, when taken together with any
breaches  or  violations  of  any  representations,  warranties,  covenants  and
agreements of the Company  contained  herein,  have a Company  Material  Adverse
Effect.

         (d) Proceedings. All proceedings to be taken on the part of the Company
in  connection  with the  transactions  contemplated  by this  Agreement and all
documents  incident  thereto  shall  be  reasonably  satisfactory  in  form  and
substance to Parent, and Parent shall have received copies of all such documents
and other  evidences as Parent may reasonably  request in order to establish the
consummation  of  such  transactions  and  the  taking  of  all  proceedings  in
connection therewith.

         (e) Investor  Representation  Letter.  Parent shall have  received from
each of the holders of Company Stock, an investor  representation letter, in the
form attached as Exhibit 4.

         (f) Purchaser Representative Certificate.  Parent shall have received a
duly executed Purchaser Representative  Certificate, in the form attached hereto
as  Exhibit  5  from  each  of the  holders  of  Company  Stock  that  is not an
"accredited investor" as defined in Regulation D under the Securities Act.

         Section  9.3  Conditions  to  Obligation  of the  Company to Effect the
Merger. The obligation of the Company to effect the Merger is further subject to
the  fulfillment,  at or prior to the  Effective  Time, of each of the following
additional  conditions (all or any of which may be waived in whole or in part by
the Company in its sole discretion):

         (a)  Representations  and  Warranties.   (A)  The  representations  and
warranties  of Parent and Merger Sub  contained  herein that are  qualified by a
Parent Material Adverse Effect and the representations and warranties  contained
in Section 5.5 shall be true and correct  when made and on and as of the Closing
Date (except for  representations  and warranties  made as of a specified  date,
which need be true and correct only as of the specified date), as if made on and
as of such date and (B) all other  representations  and warranties of Parent and
Merger  Sub  shall  have been  true and  correct  when made and on and as of the
Closing Date (except for  representations  and warranties made as of a specified
date,  which need be true and correct only as of the specified  date) as if made
on and as of such date,  except  where the failure of such  representations  and
warranties  to be so true and  correct  could not  reasonably  be  expected  to,
individually  or in the aggregate,  have a Parent Material  Adverse Effect,  and
Parent and Merger Sub shall each have  delivered  to the Company a  certificate,
dated the Closing  Date and  executed in the name and on behalf of Parent by its
Chief Executive Officer or any Executive Director, and in the name and on behalf
of  Merger  Sub by its  Chairman  of  the  Board,  Chief  Executive  Officer  or
President, to such effect.

         (b)  Performance  of  Obligations.  Parent  and  Merger  Sub shall have
performed and complied with, in all material respects, each agreement,  covenant
and obligation required by this Agreement to be so performed or complied with by
Parent or Merger Sub at or prior to the  Effective  Time,  and Parent and Merger
Sub shall each have  delivered to the Company a  certificate,  dated the Closing
Date and  executed  in the name and on behalf of Parent by its  Chairman  of the
Board,  President or any Executive Officer or any Executive  Director and in the
name and on behalf of Merger Sub by its Chairman of the Board,  Chief  Executive
Officer or Finance Director, to such effect.

         (c) Tax Opinion. The Company shall have received an opinion of Skadden,
Arps, Slate,  Meagher and Flom (Illinois)  ("Skadden  Arps"),  dated the Closing
Date, that on the basis of facts,  representations  and assumptions set forth in
such opinion  which are  consistent  with the state of facts  existing as of the
Effective  Time, for federal income tax purposes,  the Merger will  constitute a
reorganization  within the meaning of Section  368(a) of the Code.  In rendering
such opinion,  Skadden Arps may rely upon the  representations  contained herein
and may  require and rely upon (and may  incorporate  by  reference)  reasonable
representations from Parent, Merger Sub, the Company and others.

         (d)  Registration  of Option  Shares.  Pursuant to Section 2.8,  Parent
shall have  filed a  registration  statement  with the SEC,  which  registration
statement  shall be effective at the Effective  Time, with respect to the Parent
Ordinary  Shares to be  issued  upon the  exercise  of Stock  Options  after the
Effective Time.

         (e)  Companies  Act Section  103.  Notwithstanding  the  provisions  of
Section  7.11,  each holder of Company  Stock shall have  received the report to
which such holder is entitled in  compliance  with section 103 of the  Companies
Act in relation to the allotment of Parent  Shares by Parent in accordance  with
Section  2.6,  unless  Parent has  provided to the Company a written  opinion of
leading U.K. Queen's counsel, in a form reasonably  satisfactory to the Company,
that  Parent is not  required  to  provide  a report  under  section  103 of the
Companies Act in relation to such allotment.


                                    ARTICLE X

                  SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION

         Section   10.1   Survival   of   Representations.    Except   for   the
representations and warranties contained in (i) Sections 4.15, 4.17, 4.19, 5.12,
5.16 and 5.17 which shall survive until the expiration of the applicable statute
of limitations (including any extensions thereof) and (ii) Sections 4.2 and 4.3,
5.2  and  5.3,  which  shall  survive  indefinitely,   the  representations  and
warranties contained in this Agreement shall survive for a period of 1 year from
the Effective Time.

         Section 10.2 Indemnification. (a) Stockholder Indemnification.  Subject
to clause (c) of this Section 10.2 and Section  10.5,  the  stockholders  of the
Company (the "Stockholder  Indemnitors")  shall severally (and not jointly),  in
proportion to the Prior  Ownership  Allocation,  indemnify and hold Parent,  the
Surviving  Corporation  and  their  Affiliates  and their  respective  officers,
directors,  employees, agents and Affiliates and their respective successors and
assigns (each a "Parent Indemnitee") harmless from damages, losses, liabilities,
obligations,  claims of any  kind,  interest  or  expenses  (including,  without
limitation,  reasonable attorneys' fees and expenses (each a "Loss")),  suffered
or  paid,   directly  or  indirectly,   through  application  of  the  Surviving
Corporation's or the Parent's assets or otherwise, as a result of, in connection
with or arising out of (i) the failure of any representation or warranty made by
the  Company in this  Agreement  or in any  Schedule,  Exhibit,  or  Certificate
attached hereto or thereto or delivered  pursuant to this Agreement  (other than
pursuant to Section 4.7  (Information  Supplied) and Section 4.17 (Taxes)) to be
true and correct in all respects as of the date of this  Agreement and as of the
Effective Time (except for  representations and warranties made as of a specific
date,  which shall be true and correct as of such date),  (ii) any Loss  arising
out of any third party claim referred to in Section 10.4 primarily in connection
with the  failure  of any  representation  or  warranty  made by the  Company in
Section  4.7 to be true and  correct  in all  respects  and (iii) any  breach or
alleged breach by the Company of any of its covenants or agreements contained in
this Agreement. Notwithstanding any other provision of this Agreement, including
this Section 10.2(a) and Article VIII, none of the Stockholder Indemnitors shall
have any obligation to indemnify, or otherwise have any liability to, the Parent
Indemnitees  for  any  Loss  arising  out  of,  or  relating  to  the  business,
operations,  tax  liability  or tax  matters of any of the  Subsidiaries  of the
Company  prior to the closing of the  acquisition  of such  Subsidiaries  by the
Company or by another  Subsidiary  of the Company or by a Subsidiary of any such
Subsidiary,   and  so  on,  including   without   limitation  any  breach  of  a
representation or warranty  contained in Article IV arising out of or related to
the  business,  operations,  tax  liability or tax matters of such  Subsidiaries
prior to the date of the closing of the acquisition of such  Subsidiaries by the
Company or by another  Subsidiary  of the Company or by a Subsidiary of any such
Subsidiary,  and so on (a  "Pre-acquisition  Breach") other than with respect to
any such  Pre-acquisition  Breach which any of Terence  Graunke,  Tim  Donmoyer,
Kathleen  Johnston,  Julian  Hanson-Smith and Daniel Kirk has actual  knowledge,
after reasonable inquiry, as of the date of this Agreement.

         (b) Parent Indemnification.  Subject to clause (c) of this Section 10.2
and Section 10.5, Parent and Merger Sub ("Parent Indemnitors") shall jointly and
severally  indemnify  and  hold  the  stockholders  of  the  Company  and  their
Affiliates  and their  respective  officers,  directors,  employees,  agents and
Affiliates  and their  respective  successors  and assigns (each a  "Stockholder
Indemnitee") harmless from all Losses, suffered or paid, directly or indirectly,
by a Stockholder  Indemnitee,  as a result of, in connection with or arising out
of (i) the  failure of any  representation  or  warranty  made by Parent in this
Agreement or in any Schedule, Exhibit, or Certificate attached hereto or thereto
or  delivered  by Parent  pursuant to this  Agreement  (other  than  pursuant to
Section  5.8) to be true  and  correct  in all  respects  as of the date of this
Agreement  and  as  of  the  Effective  Time  (except  for  representations  and
warranties  made as of a specific  date,  which  shall be true and correct as of
such date),  (ii) any Loss  arising out of any third party claim  referred to in
Section 10.4 primarily in connection with the failure of any  representation  or
warranty  made by Parent in Section 5.8 to be true and  correct in all  respects
(iii) any breach or alleged  breach by Parent  and/or Merger Sub of any of their
respective  covenants  or  agreements  contained  in this  Agreement,  (iii) any
failure  of  the  Surviving  Corporation  to  pay  the  Contingent  Holders  the
Contingent Payments if and when due and (iv) any contravention of Section 103 of
the Companies Act by Parent or any independent person (as defined in Section 108
of the Companies  Act) in relation to the issuance of Parent Shares by Parent in
accordance with Section 2.6.

         (c) The parties  hereto have agreed that separate  standards will apply
to the use of the terms "material," "materiality," and "Company Material Adverse
Effect" (together "Company Materiality Terms") or "material,"  "materiality," or
"Parent  Material  Adverse Effect"  (together  "Parent  Materiality  Terms") for
purposes of determining the satisfaction of Section 9.2(a) or 9.3(a), on the one
hand,  and the  rights to  indemnification  under  Sections  10.2(a)  and (b) or
otherwise  (including  any  claim of  fraud),  on the  other.  For  purposes  of
determining  the  satisfaction  of  Sections  9.2(a)  and  9.3(a),  the  Company
Materiality  Terms or the Parent  Materiality  Terms  shall each be given  their
respective  separate meanings in accordance with applicable law. For purposes of
indemnification,  the  representations  and warranties in Article IV (other than
Section 4.5,  the second  sentence of Section 4.8, and clauses (i), (v) and (vi)
of Section  4.6),  the  covenants  contained in Section 6.1 and Article V (other
than Section 5.5 and clause (a)(i) of Section 5.6) shall be construed as if they
were not qualified by the Company  Materiality  Terms or the Parent  Materiality
Terms, as applicable.  For indemnification  purposes under Section 10.2(a),  the
Company  Materiality  Terms  contained in Section  4.5,  the second  sentence of
Section 4.8, clauses (i), (v) and (vi) of Section 4.6 and the Parent Materiality
Terms,  contained  in Section 5.5,  the  covenants  contained in Section 6.1 and
clause  (a)(i) of Section  5.6 shall  each be given  their  separate  meaning in
accordance with applicable law.

         (d) The  obligations  to indemnify and hold  harmless  pursuant to this
Section 10.2, as applicable,  shall survive the consummation of the transactions
contemplated  by this  Agreement for the time periods set forth in Section 10.1,
except for claims for indemnification asserted prior to the end of such periods,
which claims shall survive until final resolution thereof.

         Section  10.3  Stockholder  Indemnitors'  Representative.  (a)  Terence
Graunke  shall  be  appointed  by  the  stockholders  of  the  Company  (in  the
Indemnification  Agreements) as the sole,  exclusive,  true and lawful agent and
representative  of the Stockholder  Indemnitors (the  "Stockholder  Indemnitors'
Representative")  with respect to any and all matters  relating to,  arising out
of, or in connection with, this Article X of this Agreement.

         (b) Parent  shall be entitled to rely on the  Stockholder  Indemnitors'
Representative's  authority as the agent and  representative  of the Stockholder
Indemnitors  for all purposes  hereunder  (including  the giving or receiving of
notices and  information  to or from an  Indemnifying  Party pursuant to Section
10.4 other than a service of process) and shall have no  liability  for any such
reliance.

         Section 10.4 Indemnification Procedures. (a) If an event occurs which a
party (an  "Indemnitee")  asserts is an indemnifiable  event pursuant to Section
10.2,  as  applicable,  the  Indemnitee  shall  promptly  notify the other party
obligated to provide such  indemnification  (the "Indemnifying  Party").  If any
Indemnitee  shall  incur any Loss in  respect  of which  indemnification  may be
sought by such  Indemnitee  pursuant to this  Article X , Sections  7.14 or 8.2,
such  Indemnitee  shall  assert a claim for  indemnification  by written  notice
("Notice") to the Indemnifying Party stating the nature and basis of such claim.
In the case of a Loss  arising by reason of any  third-party  claim,  the Notice
shall be given  within 30 days of the  filing  or  written  assertion  which the
Indemnitee  believes will give rise to indemnification  pursuant to this Article
X,  Sections  7.14 or 8.2,  but the failure of the  Indemnitee  so to notify the
Indemnifying Party shall not relieve the Indemnifying Party of any liability the
Indemnifying  Party may have to the  Indemnitee  except to the  extent  that the
Indemnifying  Party  demonstrates  that its defense of such claim is  prejudiced
thereby.  The Indemnitee shall provide to the Indemnifying Party all information
and documentation  reasonably  necessary to support and verify any Loss or other
claims which the  Indemnitee  believes give rise to a claim for  indemnification
hereunder and shall give the Indemnifying  Party reasonable access to all books,
records and Personnel in the  possession or under the control of the  Indemnitee
which would have bearing on such claim.

         (b) In the case of third party  claims,  the  Indemnifying  Party shall
(subject to its acknowledgment of its indemnity  obligation) have the option (i)
to conduct any proceeding or negotiations in connection therewith,  (ii) to take
all other steps to settle,  remedy or defend any such claim,  provided  that the
Indemnifying  Party  shall not settle any such claim  without the consent of the
Indemnitee, which consent shall not be unreasonably withheld and (iii) to employ
counsel  reasonably  acceptable  to the  Indemnitee to contest any such claim or
liability in the name of the  Indemnitee or otherwise.  The  Indemnifying  Party
shall,  within 15 days of receipt of Notice of such claim, notify the Indemnitee
of its  intention  to  assume  the  defense  of such  claim  provided  that  the
Indemnifying Party has unconditionally  acknowledged in writing the Indemnifying
Party's indemnity obligation hereunder.  If the Indemnifying Party shall decline
to assume the defense of any such claim,  the  Indemnitee may defend against any
such claims in such manner as it may deem appropriate,  without prejudice to its
indemnification rights hereunder.  The expenses of all proceedings,  contests or
lawsuits  with respect to such claims shall be borne by the  Indemnifying  Party
but only if the Indemnifying  Party is responsible  pursuant hereto to indemnify
the  Indemnitee in respect of the  third-party  claim and provided  that, if the
Indemnifying  Party shall have assumed the defense of any such claim as provided
herein, the fees and expenses of any counsel retained by the Indemnitee shall be
paid by the  Indemnitee.  Regardless  of which party shall assume the defense of
the claim,  the parties agree to cooperate  fully with one another in connection
therewith.  No third party  claim,  demand,  action or  proceeding  for which an
Indemnitee  is seeking  indemnification  under  this  Article X shall be settled
without  the prior  written  consent of the  Indemnifying  Party.  If (i) a firm
written  offer is made to settle any such third party claim,  demand,  action or
proceeding,  (ii) the Indemnifying  Party proposes to accept such settlement and
(iii) the  Indemnitee  refuses  to  consent to such  settlement,  then:  (A) the
maximum liability of the Indemnifying  Party relating to such third party claim,
demand,  action or proceeding shall be the amount of the proposed  settlement if
the amount  thereafter  recovered from the Indemnitee on such third party claim,
demand,  action  or  proceeding  is  greater  than the  amount  of the  proposed
settlement;  and (B) the Indemnitee shall pay all reasonable attorneys' fees and
legal costs and expenses  incurred  after  rejection of such  settlement  by the
Indemnitee,  but if the amount thereafter recovered by such third party from the
Indemnitee is less than the amount of the proposed  settlement,  the  Indemnitee
shall be reimbursed by the Indemnifying Party for such attorneys' fees and legal
costs and expenses up to a maximum  amount equal to the  difference  between the
amount recovered by such third party and the amount of the proposed  settlement.
If, and to the extent, the Indemnifying Party is responsible  pursuant hereto to
indemnify  the  Indemnitee  in respect of a  third-party  claim,  then  within 5
business days of the  reasonable  request of the  Indemnitee,  the  Indemnifying
Party shall pay on behalf of the Indemnitee, in immediately available funds, the
amount of any Loss, or such portion thereof as the  Indemnifying  Party shall be
responsible  for,  pursuant  to  this  Article  X  representing  payment  by the
Indemnifying  Party of such  third-party  claim.  If any  Loss or  other  claims
incurred  by the  Indemnitee  do not  involve  payment  by the  Indemnitee  of a
third-party  claim,  then  if,  and to the  extent,  the  Indemnifying  Party is
responsible  pursuant hereto to indemnify the Indemnitee  against such Loss, the
Indemnifying  Party shall within ten (10) days of the reasonable  request of the
Indemnitee pay to the Indemnitee,  in immediately available funds, the amount of
such Loss or other claims payable pursuant to this Article X.

         Section 10.5  Limitations.  Anything to the contrary  contained  herein
notwithstanding  (x) no Indemnitee  shall be entitled to recover with respect to
Losses relating to breaches of (i)  representations  and warranties made in this
Agreement (other than with respect to Losses arising out of the  representations
and  warranties set forth in Section 4.7 and Section 4.17,  Sections 5.12,  5.16
and 5.17) from an  Indemnifying  Party and (ii)  breaches  of any of  covenants,
undertakings or other  agreements of the Company set forth in the first sentence
of Section  6.1,  unless  and until the  aggregate  amount of Losses  under this
Agreement exceeds $10 million (the "Indemnification  Threshold"),  and then only
to the extent such aggregate  amount exceeds the  Indemnification  Threshold and
(y) with  respect to Taxes,  losses,  claims  and  expenses  arising  out of the
representations  and  warranties  set forth in Section 4.17 and Section 5.16 and
the   indemnification   obligations  set  forth  in  Article  VIII,  the  Parent
Indemnitees or Stockholder Indemnitees, as applicable,  shall not be entitled to
recover from the Parent Indemnitors or Stockholder  Indemnitors,  as applicable,
unless and until the aggregate amount of such Taxes, losses, claims and expenses
exceeds  $1 million  (the "Tax  Threshold"),  and then only to the  extent  such
aggregate  amount  exceeds  the  Tax  Threshold;  provided,  however,  that  the
Indemnitees shall not be entitled to recover from the Indemnifying  Parties,  in
aggregate,  more than  $70,000,000  (the  "Cap")  of the total  amount of Losses
referred to in clauses (x) and (y); and provided  further that,  with respect to
clause (x), no individual Loss shall be applied to the Indemnification Threshold
or subject to a claim for indemnification  under this Article X unless the total
amount of such Loss exceeds  $150,000;  for the  avoidance of doubt,  the Parent
Indemnitees,  individually or in the aggregate, shall not be entitled to recover
from any  Stockholder  Indemnitor an aggregate  amount equal to or exceeding the
product  of  $70,000,000  multiplied  by  such  Stockholder  Indemnitor's  Prior
Ownership Allocation.

         Section 10.6 Adjustment for Insurance. The amount which an Indemnifying
Party is required to pay to, for or on behalf of the Indemnitee pursuant to this
Article X and Article  VIII shall be adjusted  (including,  without  limitation,
retroactively) by any insurance  proceeds actually  recovered by or on behalf of
such   Indemnitee   in  reduction  of  the  related   indemnifiable   loss  (the
"Indemnifiable  Loss"),  less the cost of  procuring  such  insurance  proceeds.
Amounts required to be paid, as so reduced, are hereinafter  sometimes called an
"Indemnity Payment." If an Indemnitee has received or has had paid on its behalf
an  Indemnity  Payment  for an  Indemnifiable  Loss  and  subsequently  receives
insurance  proceeds for such  Indemnifiable  Loss, then the Indemnitee shall (i)
promptly notify the Indemnifying Party of the amount and nature of such proceeds
and  benefits,  together  with the cost of procuring  them,  and (ii) pay to the
Indemnifying  Party  the  amount of such  insurance  proceeds  (reduced  by such
procurement cost), or, if lesser, the amount of the Indemnity Payment.

         Section 10.7 Adjustment for Recoveries  under  Acquisition  Agreements.
The amount of any Loss which the Stockholder  Indemnitors are required to pay to
a Parent Indemnitee pursuant to this Article X and Article VIII shall be reduced
(including,  without  limitation,  retroactively  by refunds to the  Stockholder
Indemnitors if appropriate) by any amounts received by such Parent Indemnitee in
connection with such Loss under any Acquisition Agreement in connection with the
acquisition of the Subsidiary (an "Acquisition Agreement  Indemnity"),  less the
cost  incurred  and  not  otherwise  recovered  in  procuring  such  Acquisition
Agreement  Indemnity.  In the  event  that the  breach of a  representation  and
warranty under this Agreement also constitutes a breach of a representation  and
warranty under an Acquisition Agreement,  then, in such instance, as a condition
precedent  to any Parent  Indemnitee  making a claim  under  this  Article X and
Article VIII,  such Parent  Indemnitee  must, to the extent  available under the
indemnification provisions of the applicable Acquisition Agreement, make a claim
for  indemnification  under  such  Acquisition  Agreement.  Although  any Parent
Indemnitee  may,  immediately  after  making such claim  under such  Acquisition
Agreement,  make a claim for  indemnification  under  this  Article X or Article
VIII, as the case may be, provided Parent  Indemnitee must use all  commercially
reasonable  efforts to obtain a recovery of all the applicable Losses covered by
an Acquisition Agreement Indemnity from the Indemnifying Parties related to such
Acquisition Agreements. In the event that a Parent Indemnitee agrees to settle a
claim  relating to the  Acquisition  Agreements,  the maximum  liability  of the
Indemnifying  Party  as to  such  claim  will  not  exceed  the  amount  of such
settlement.

         Section  10.8  Subrogation.  Upon  making any  Indemnity  Payment,  the
Indemnifying Party will, to the extent of such Indemnity Payment,  be subrogated
to all rights of the  Indemnitee  against any third party in respect of the Loss
to which the  payment  relates;  provided,  however,  that until the  Indemnitee
recovers full payment of its Loss, any and all claims of the Indemnifying  Party
against  any such  third  party on  account  of such  payment  are  hereby  made
expressly  subordinated  and  subjected in right of payment of the  Indemnitee's
rights  against such third party.  Without  limiting the generality of any other
provision hereof,  each such Indemnitee and Indemnifying Party will duly execute
upon request all  instruments  reasonably  necessary to evidence and perfect the
above described subrogation and subordination rights.

         Section 10.9 Set-Off.  Parent  Indemnitors shall not have any rights to
set-off any Losses  against any  payments to be made by such Person  pursuant to
this Agreement or any other agreement,  except as otherwise  expressly  provided
herein or therein.

         Section 10.10 Exclusive Remedy.  Following the Closing, the indemnities
provided for in this Article X , Article VIII and Section  7.14(h)  shall be the
sole and  exclusive  remedies  of any of the  Indemnitees  and their  respective
officers,    directors,    stockholders,    employees,    Affiliates,    agents,
representatives,  successors  and assigns for any breach of or inaccuracy in any
representation  or  warranty  or any  breach,  nonfulfillment  or default in the
performance  of any of the covenants or agreements  contained in this  Agreement
(but not any such  covenants or agreements to the extent they are by their terms
to be performed  after the Closing Date).  No Indemnitee  shall be entitled to a
recision of this Agreement,  punitive damages or to any further  indemnification
rights or  claims of any  nature  whatsoever  in  respect  thereof  (whether  by
contract,  common law, statute, law, regulation or otherwise),  all of which the
parties  hereby  waive,  provided,  however,  that nothing in this  Agreement is
intended to waive any claims or remedies for fraud.


                                   ARTICLE XI

                        TERMINATION, AMENDMENT AND WAIVER

         Section 11.1  Termination.  This Agreement may be  terminated,  and the
transactions  contemplated  hereby  may be  abandoned,  at any time prior to the
Effective Time, whether prior to or after the Company Stockholders'  Approval or
the Parent Shareholders' Approval:

         (a) By mutual written  agreement of the parties hereto duly  authorized
    by action taken by or on behalf of their respective Boards of Directors;

         (b)  By  either  the  Company  or  Parent  upon   notification  to  the
    non-terminating party by the terminating party:

              (i) at any time after September 7, 2000 (the "Termination  Date"),
         if the Merger shall not have been  consummated on or prior to such date
         and such failure to consummate  the Merger is not caused by a breach of
         this Agreement by the terminating party; provided,  however, that if on
         such date Parent and the Company and their respective Subsidiaries have
         not  received  all of the  approvals  required  in order to satisfy the
         conditions set forth in Section 9.1(f),  9.1(g) or 9.1(h) but all other
         conditions  to effect the Merger shall be fulfilled or shall be capable
         of being fulfilled, then, at the option of either Parent or the Company
         (which shall be  exercised by written  notice),  the  Termination  Date
         shall be extended until October 7, 2000;

              (ii)  if  the  Company   Stockholders'   Approval  or  the  Parent
         Shareholders'  Approval  shall not be obtained by reason of the failure
         to obtain the requisite  vote upon a vote actually held at a meeting of
         such stockholders or shareholders,  or any adjournment thereof,  called
         therefor;

              (iii) if there has been a material  breach of any  representation,
         warranty,  covenant  or  agreement  on the part of the  non-terminating
         party set forth in this  Agreement  (determined  in all cases as if the
         terms  "material"  or  "materially"  were  not  included  in  any  such
         representation  or  warranty),  which  breach  is not  curable  or,  if
         curable,  has not been cured within thirty (30) days following  receipt
         by the  non-terminating  party  of  notice  of  such  breach  from  the
         terminating  party which  breach,  when taken  together  with any other
         breaches of  representations,  warranties,  covenants and agreements of
         the  non-terminating  party contained in this  Agreement,  has or could
         reasonably be expected to have a Company  Material  Adverse Effect or a
         Parent Material Adverse Effect, as the case may be;

              (iv) if the average of the closing  middle  market  quotation of a
         Parent Share on the LSE as reported in the Daily  Official  List of the
         London Stock  Exchange falls below 254.5p for any 15 Trading Days prior
         to the Effective Time; or (v) if any court of competent jurisdiction or
         other competent  Governmental or Regulatory Authority shall have issued
         an order making  illegal or otherwise  preventing  or  prohibiting  the
         Merger and such order shall have become final and nonappealable; or

         (c) By Parent if the shares of Dissenting  Stock  represents 2% or more
    of the total shares of Company Common Stock issued and outstanding  (without
    giving effect to the Stock Options) immediately prior to the Effective Time.

         Section 11.2 Effect of Termination. In the event of termination of this
Agreement by either Parent or the Company, this Agreement shall forthwith become
void and  there  shall be no  liability  hereunder  on the part of the  Company,
Parent  or Merger  Sub or their  respective  officers  or  directors;  provided,
however,  that nothing  contained  in this Section 11.2 shall  relieve any party
hereto from any  liability for any breach of this  Agreement or for  obligations
under Sections 7.7(b), 7.7(c), 7.9 or 11.3.

         Section 11.3 Payment of Certain Fees.  If this  Agreement is terminated
by either  party  pursuant  to Section  11.1(b)(ii)  hereof and (x) a  bona-fide
Takeover  Proposal  with  respect  to  Parent  has been  publicly  announced  or
communicated to Parent's shareholders after the date of this Agreement and prior
to the Parent  Shareholder  Meeting and (y) concurrently  with or within six (6)
months of the date of such termination,  Parent consummates a Takeover Proposal,
then Parent shall pay $8 million to the Company.



                                   ARTICLE XII

                               GENERAL PROVISIONS

         Section 12.1 Notices.  All notices and other  communications  hereunder
shall be in writing and shall be deemed given if delivered  personally,  sent by
overnight  courier or  telecopied  (with a  confirmatory  copy sent by overnight
courier) to the parties at the following addresses, or at such other address for
a party as shall be specified by like notice:

         (a) if to Parent or Merger Sub, to

             c/o Cordiant Communications Group plc
             121-141 Westbourne Terrace
             London, W2 6JR
             Attention:  Michael Bungey
             Facsimile No.:  011-44-207-262-4300

             with copies to:

             White & Case LLP
             1155 Avenue of the Americas
             New York, NY  10036
             Attention:  Timothy B. Goodell, Esq.
             Facsimile No.:  (212) 354-8113

             and:

             Gould & Wilkie LLP
             One Chase Manhattan Plaza
             New York, New York, 10005
             Attention:  Michael J. Kopcsak, Esq.
             Facsimile No.:  (212) 363-2138

             and:

             Macfarlanes
             10 Norwich Street London EC4A 1BD
             Attention:  Mary Leth, Esq.
             Facsimile No.:  011-44-171-831-9607

        (b)  if to the Company, to

             Lighthouse Global Network, Inc.
             676 North Michigan Avenue
             Chicago, IL  60611
             Attention:  Kathleen Johnston, Esq.
             Facsimile No.:  (312) 640-7051

             with a copy to:

             Skadden Arps Slate Meagher & Flom (Illinois)
             333 West Wacker Drive
             Suite 2100
             Chicago, IL  60606
             Attention:  Peter C. Krupp, Esq.
             Facsimile No.:  (312) 407-0411

         Section 12.2 Interpretation. When a reference is made in this Agreement
to a Section,  such  reference  shall be to a Section of this  Agreement  unless
otherwise  indicated.  The table of  contents  and  headings  contained  in this
Agreement  are for  reference  purposes only and shall not affect in any way the
meaning or  interpretation  of this  Agreement.  Whenever  the words  "include,"
"includes" or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation."

         Section  12.3   Counterparts.   This   Agreement  may  be  executed  in
counterparts,  all of which shall be considered  one and the same  agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties.

         Section  12.4 Entire  Agreement;  No  Third-Party  Beneficiaries.  This
Agreement,  including the documents and instruments referred to herein, together
with the  Confidentiality  Agreement  dated March 6, 2000, (a)  constitutes  the
entire  agreement and supersedes all prior agreements and  understandings,  both
written and oral,  among the parties with respect to the subject  matter  hereof
and (b)  except as  otherwise  provided  in  Sections  2.9(b)  and 7.10,  is not
intended to confer upon any Person other than the parties any rights or remedies
hereunder.

         Section 12.5  Amendment.  This  Agreement may be amended by the parties
hereto,  by or pursuant to action taken by their respective Boards of Directors,
at any time before or, to the extent  permitted  by  applicable  Law,  after any
approval of the Merger by the  stockholders  of the Company.  This Agreement may
not be amended  except by an instrument  in writing  signed on behalf of each of
the parties hereto.

         Section  12.6  Waiver.  At any time prior to the  Effective  Time,  the
parties  hereto  may (i)  extend  the  time  for the  performance  of any of the
obligations  or  other  acts  of  the  other  parties  hereto,  (ii)  waive  any
inaccuracies in the  representations  and warranties  contained herein or in any
document  delivered  pursuant hereto and (iii) waive  compliance with any of the
agreements  or  conditions  contained  herein  which may legally be waived.  Any
agreement on the part of a party hereto to any such extension or waiver shall be
valid only if set forth in an  instrument  in  writing  signed on behalf of such
party.

         Section 12.7 Governing  Law. This  Agreement  shall be governed by, and
construed in accordance  with,  the  substantive  laws of the State of New York,
regardless of the laws that might otherwise govern under  applicable  principles
of  conflicts  of laws  thereof;  provided  however,  that the  Merger  shall be
governed by the laws of the State of Delaware.

         Section 12.8 Assignment.  Neither this Agreement nor any of the rights,
interests  or  obligations  hereunder  shall be  assigned  by any of the parties
without the prior written  consent of the other parties,  except that Merger Sub
may assign,  in its sole  discretion,  any of or all its rights,  interests  and
obligations  under  this  Agreement  to  Parent  or to any  direct  or  indirect
wholly-owned  subsidiary of Parent,  but no such assignment shall relieve Parent
or Merger Sub of any of its  obligations  hereunder.  Subject  to the  preceding
sentence,  this Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the parties and their respective successors and assigns.

         Section  12.9  Severability.  If any  term or other  provision  of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy,  all other  conditions and provisions of this Agreement  shall
nevertheless  remain in full force and effect so long as the  economic  or legal
substance of the transactions contemplated hereby are not affected in any manner
materially  adverse to any party. Upon such determination that any term or other
provision is invalid,  illegal or incapable of being enforced, the parties shall
negotiate  in good faith to modify this  Agreement  so as to effect the original
intent of the parties as closely as possible in a mutually  acceptable manner in
order that the  transactions  be consummated as originally  contemplated  to the
fullest extent possible.

         Section 12.10  Enforcement  of this  Agreement.  The parties agree that
irreparable  damage would occur in the event that any of the  provisions of this
Agreement  were not performed in accordance  with their  specific  terms or were
otherwise breached.  It is accordingly agreed that the parties shall be entitled
to an injunction or  injunctions  to prevent  breaches of this  Agreement and to
enforce  specifically the terms and provisions hereof in any court of the United
States or any state  having  jurisdiction,  this being in  addition to any other
remedy to which they are entitled at law or in equity.

         Section 12.11 Incorporation of Exhibits. The Company Disclosure Letter,
the Parent  Disclosure  Letter and all Exhibits,  Schedules and annexes attached
hereto and  referred  to herein are hereby  incorporated  herein and made a part
hereof for all purposes as if fully set forth herein.

<PAGE>
         IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this
Agreement to be signed by their  respective  officers  thereunto duly authorized
all as of the date first written above.



                                            CORDIANT COMMUNICATIONS GROUP PLC

                                            By: /s/ Arthur D'Angelo
                                               ---------------------------------
                                               Name:  Arthur D'Angelo
                                               Title: Chief Financial Officer


                                            LIGHTHOUSE ACQUISITION, INC.

                                            By: /s/ Arthur D'Angelo
                                               ---------------------------------
                                               Name:  Arthur D'Angelo
                                               Title: President


                                            LIGHTHOUSE GLOBAL NETWORK, INC.

                                            By: /s/ Terence M. Graunke
                                               ---------------------------------
                                               Name:  Terence M. Graunke
                                               Title: Chairman/Chief Executive
                                                      Officer