<PAGE>   1


                                  Exhibit (ii)


                           RESTRICTED STOCK AGREEMENT

         THIS RESTRICTED STOCK AGREEMENT, dated as of March 22, 2001 (the "Award
Date"), is made by and between VARSITY GROUP INC., a Delaware corporation (the
"Corporation"), and Eric Kuhn an executive officer of the Corporation (the
"Executive"):

         WHEREAS, the Corporation has established The Second Amended and
Restated 1998 Stock Plan of Varsity Group Inc., as amended (the "Plan");

         WHEREAS, the Corporation wishes to carry out the Plan (the terms of
which are hereby incorporated by reference and made a part of this Agreement);

         WHEREAS, the Plan provides for the issuance of shares of the
Corporation's Common Stock (as defined hereunder), subject to certain
restrictions thereon (hereinafter referred to as "Restricted Stock");

         WHEREAS, the Corporation's Board of Directors has determined that it
would be to the advantage and best interest of the Corporation and its
stockholders to issue the shares of Restricted Stock provided for herein to the
Executive in partial consideration of past services to the Corporation and/or
its subsidiaries, and the Board of Directors of the Corporation has approved the
issuance of such shares of Restricted Stock to the Executive upon the terms and
conditions set forth herein; and

      NOW, THEREFORE, in consideration of the mutual covenants herein contained
and other good and valuable consideration, receipt of which is hereby
acknowledged, the parties hereto do hereby agree as follows:


                                   ARTICLE I.
                                   DEFINITIONS

         Whenever the following terms are used below in this Agreement, they
shall have the meaning specified below unless the context clearly indicates to
the contrary. Capitalized terms not otherwise defined herein shall have the
meanings set forth in the Plan. The masculine pronoun shall include the feminine
and neuter, and the singular the plural, where the context so indicates.

         SECTION 1.1 CAUSE. "Cause" shall mean without limitation: (i)
conviction of, or the pleading of nolo contendere to, a felony, (ii) a material
breach of Executive's Employment Agreement which materially and adversely
affects the Corporation's business and operations, (iii) the failure of
Executive for any reason, within ten (10) days after receipt by Executive of
written notice thereof from the Corporation, to correct, cease or otherwise
alter any failure to comply with instructions or other action or omission to act
which will materially or adversely affect its business or operations, (iv)
misconduct by Executive which is of such a serious and substantial nature that a
reasonable likelihood exists that such misconduct will materially injure the
reputation of the Corporation if Executive was to remain employed by the
Corporation, and (v) proven gross negligence.

         SECTION 1.2 CHANGE OF CONTROL EVENT. "Change of Control Event" is
defined in Section 3.5.

         SECTION 1.3 EXCHANGE ACT. "Exchange Act" shall mean the Securities
Exchange Act of 1934, as amended.

         SECTION 1.4 RESTRICTIONS. "Restrictions" shall mean the forfeiture and
transferability restrictions imposed upon Restricted Stock under this Agreement.


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         SECTION 1.5 RESTRICTED STOCK. "Restricted Stock" shall mean Common
Stock of the Corporation issued under this Agreement and subject to the
Restrictions imposed hereunder.

         SECTION 1.6 RULE 16B-3. "Rule 16b-3" shall mean that certain Rule 16b-3
under the Exchange Act, as such Rule may be amended from time to time.

         SECTION 1.7 SECRETARY. "Secretary" shall mean the Secretary of the
Corporation.

         SECTION 1.8 SECURITIES ACT. "Securities Act" shall mean the Securities
Act of 1933, as amended.

         SECTION 1.9 TERMINATION OF EMPLOYMENT. "Termination of Employment"
shall mean the time when the employee-employer relationship between the
Executive and the Corporation, a Parent, or a Subsidiary is terminated for any
reason, including, but not by way of limitation, a termination by resignation,
discharge, death, disability or retirement, but excluding (i) any termination
where there is a simultaneous reemployment by the Corporation, a Parent or a
Subsidiary, (ii) at the discretion of the Board of Directors, any termination
which results in a temporary severance of the employee-employer relationship,
and (iii) at the discretion of the Board of Directors, any termination where the
Executive continues a relationship (e.g., as a director or as a consultant) with
the Corporation, a Parent, or a Subsidiary. The Board of Directors, in its
absolute discretion, shall determine the effect of all other matters and
questions relating to Termination of Employment, including, but not by way of
limitation, the question of whether a Termination of Employment resulted from a
discharge for Cause, and all questions of whether a leave of absence constitutes
a Termination of Employment. Notwithstanding any other provision of this
Agreement, the Corporation, a Parent, or a Subsidiary has an absolute and
unrestricted right to terminate the Executive's employment at any time for any
reason whatsoever, with or without cause.

         SECTION 1.10 VESTED SHARES. "Vested Shares" is defined in Section 3.1.


                                   ARTICLE II.
                          ISSUANCE OF RESTRICTED STOCK

         SECTION 2.1 ISSUANCE OF RESTRICTED STOCK. For good and valuable
consideration which the Board of Directors has determined to be in excess of the
par value of its Common Stock, on the date hereof the Corporation issues to the
Executive 100,000 shares of its Common Stock upon the terms and conditions set
forth in this Agreement.

         SECTION 2.2 CONSIDERATION TO THE CORPORATION. As consideration for the
release of the restrictions on the Restricted Stock set forth herein, the
Executive agrees to render faithful and efficient services to the Corporation, a
Parent, or a Subsidiary with such duties and responsibilities as the Corporation
shall from time to time prescribe for a period of at least two years from the
Award Date. Nothing in this Agreement or in the Plan shall confer upon the
Executive any right to continue in the employ of the Corporation, any Parent, or
any Subsidiary or shall interfere with or restrict in any way the rights of the
Corporation, any Parent, or any Subsidiary, which are hereby expressly reserved,
to discharge the Executive at any time for any reason whatsoever, with or
without cause.


                                  ARTICLE III.
                                  RESTRICTIONS

         SECTION 3.1 REPURCHASE OF RESTRICTED STOCK. The Corporation may
repurchase the Restricted Stock from the Executive upon the terms and conditions
hereinafter set forth within sixty (60) days after termination of the Executive
by the Corporation for Cause.

         In the event the Corporation exercises its right to repurchase, the
Corporation shall promptly pay to the Executive an amount per share equal to the
original purchase price paid per share (i.e., $0.001 per share) by the Executive
for the Restricted Stock shares, as adjusted from time to time for stock splits,
stock dividends, stock combinations and other recapitalizations.


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         In the event that Executive is unable to, or for any reason does not,
promptly deliver the certificate or certificates evidencing the Restricted Stock
shares repurchased by the Corporation (or any assignment form) to the
Corporation in accordance with this Agreement, the Corporation may deposit the
purchase price for such repurchased shares (in cash or by good check) with any
bank doing business within a fifty (50) mile radius of the Corporation's
principal office, to be held by such bank in escrow until withdrawn by the
Executive. Upon such deposit by the Corporation and upon delivery of written
notice of such deposit to the Executive, such Restricted Stock shares shall at
such time be deemed to have been repurchased by the Corporation, the Executive
shall have no further rights thereto and the Corporation shall record such
transfer in its stock transfer book. Notwithstanding the foregoing provisions of
this Section 3.1, the right to repurchase shall not apply to any "Vested Shares"
held by the Executive. "Vested Shares" shall mean that number of shares of
Restricted Stock set forth in the table below:

<TABLE>
<CAPTION>
             Date of Termination                Number of Vested Shares
             -------------------                -----------------------
              <S>                                       <C>
              March 22, 2001                             4,166
              April 22, 2001                             8,332
              May 22, 2001                              12,498
              June 22, 2001                             16,664
              July 22, 2001                             20,830
              August 22, 2001                           24,996
              September 22, 2001                        29,162
              October 22, 2001                          33,328
              November 22, 2001                         37,494
              December 22, 2001                         41,660
              January 22, 2002                          45,826
              February 22, 2002                         49,992
              March 22, 2002                            54,158
              April 22, 2002                            58,324
              May 22, 2002                              62,490
              June 22, 2002                             66,656
              July 22, 2002                             70,822
              August 22, 2002                           74,988
              September 22, 2002                        79,154
              October 22, 2002                          83,320
              November 22, 2002                         87,486
              December 22, 2002                         91,652
              January 22, 2003                          95,818
              February 22, 2003                        100,000
</TABLE>


         SECTION 3.2 HOLDING PERIOD. None of the shares of Restricted Stock
granted under this Agreement shall be sold, assigned or otherwise transferred
until at least six months have elapsed from (but excluding) the Award Date.

         This Section 3.2 is not intended to affect the restrictions set forth
in Section 4.2.

         SECTION 3.3 LEGEND. Certificates representing shares of Restricted
Stock issued pursuant to this Agreement shall, until all restrictions lapse and
new certificates are issued pursuant to Section 3.4, bear the following legend:

               THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
               CERTAIN VESTING REQUIREMENTS AND MAY BE SUBJECT TO FORFEITURE
               UNDER THE TERMS OF THAT CERTAIN RESTRICTED STOCK AGREEMENT BY AND
               BETWEEN VARSITY GROUP INC. AND THE HOLDER OF THE SECURITIES.
               PRIOR TO VESTING OF OWNERSHIP IN THE SECURITIES, THEY


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               MAY NOT BE, DIRECTLY OR INDIRECTLY, OFFERED, TRANSFERRED, SOLD,
               ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNDER
               ANY CIRCUMSTANCES. COPIES OF THE ABOVE REFERENCED AGREEMENT ARE
               ON FILE AT THE OFFICES OF THE CORPORATION AT 2020 K STREET, N.W.,
               6TH FLOOR, WASHINGTON, D.C., 20006.

         SECTION 3.4 LAPSE OF RESTRICTIONS. Upon the vesting of the shares of
Restricted Stock as provided in Section 3.1, the Corporation shall cause new
certificates to be issued with respect to such Vested Shares and delivered to
the Executive or his legal representative, free from the legend provided for in
Section 3.3 and any of the other Restrictions. Such Vested Shares shall cease to
be considered Restricted Stock subject to the terms and conditions of this
Agreement. Notwithstanding the foregoing, no such new certificate shall be
delivered to the Executive or his legal representative unless and until the
Executive or his legal representative shall have paid to the Corporation in cash
or by check the full amount of all federal, state and local withholding or other
employment taxes applicable to the taxable income of the Executive resulting
from the lapse of the Restrictions.

         SECTION 3.5 MERGER, CONSOLIDATION, ACQUISITION, LIQUIDATION OR
DISSOLUTION. Upon the merger or consolidation of the Corporation into another
corporation, the exchange of all or substantially all of the assets of the
Corporation for the securities of another corporation, the acquisition by
another corporation or person (excluding any employee benefit plan of the
Corporation or any trustee or other fiduciary holding securities under an
employee benefit plan of the Corporation) of all or substantially all of the
Corporation's assets, the acquisition by another corporation or person of more
than 50% of the Corporation's then outstanding voting stock, or the liquidation
or dissolution of the Corporation (each a "Change of Control Event"), all shares
of Restricted Stock shall automatically vest and be exercisable beginning 30
days prior to the effective date of such Change of Control Event and all
Restrictions with respect to such shares of Restricted Stock shall immediately
expire.

         SECTION 3.6 RESTRICTIONS ON NEW SHARES. In the event that the
outstanding shares of the Corporation's Common Stock are changed into or
exchanged for cash or a different number or kind of shares or other securities
of the Corporation, or of another corporation, by reason of reorganization,
merger, consolidation, recapitalization, reclassification, stock split-up, stock
dividend, or combination of shares (excluding any employee benefit plan of the
Corporation or any trustee or other fiduciary holding securities under an
employee benefit plan of the Corporation), such new, additional or different
shares or securities which are held or received by the Executive in his capacity
as a holder of Restricted Stock shall be considered to be Restricted Stock and
shall be subject to all of the Restrictions, unless the Board of Directors
provides, pursuant to Section 3.5, for the accelerated vesting and expiration of
the Restrictions on the shares of Restricted Stock underlying the distribution
of the new, additional or different shares or securities.



                                   ARTICLE IV.
                                  MISCELLANEOUS

         SECTION 4.1 ADMINISTRATION. The Board of Directors shall have the power
to interpret the Plan, this Agreement and all other documents relating to
Restricted Stock and to adopt such rules for the administration, interpretation
and application of the Plan as are consistent therewith and to interpret, amend
or revoke any such rules. All actions taken and all interpretations and
determinations made by the Board of Directors in good faith shall be final and
binding upon the Executive, the Corporation and all other interested persons. No
member of the Board of Directors shall be personally liable for any action,
determination or interpretation made in good faith with respect to the Plan or
Restricted Stock and all members of the Board of Directors shall be fully
protected by the Corporation in respect to any such action, determination or
interpretation.

         SECTION 4.2 RESTRICTED STOCK NOT TRANSFERABLE. No Restricted Stock or
any interest or right therein or part thereof shall be liable for the debts,
contracts or engagements of the Executive or his successors in interest


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or shall be subject to disposition by transfer, alienation, anticipation,
pledge, encumbrance, assignment or any other means whether such disposition be
voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including bankruptcy),
and any attempted disposition thereof shall be null and void and of no effect;
provided, however, that this Section 4.2 shall not prevent transfers by will or
by applicable laws of descent and distribution.

         SECTION 4.3 CONDITIONS TO ISSUANCE OF STOCK CERTIFICATES. The
Corporation shall not be required to issue or deliver any certificate or
certificates for shares of stock pursuant to this Agreement prior to fulfillment
of all of the following conditions:

         vi.   The admission of such shares to listing on all stock exchanges on
               which such class of stock is then listed;

         vii.  The completion of any registration or other qualification of such
               shares under any state or Federal law or under rulings or
               regulations of the Securities and Exchange Commission or of any
               other governmental regulatory body, which the Board of Directors
               shall, in its absolute discretion, deem necessary or advisable;

         viii. The obtaining of any approval or other clearance from any state
               or Federal governmental agency which the Board of Directors
               shall, in its absolute discretion, determine to be necessary or
               advisable;

         ix.   The payment by the Executive of all amounts required to be
               withheld, under federal, state and local tax laws, with respect
               to the issuance of Restricted Stock and/or the lapse or removal
               of any of the Restrictions; and

         x.    The lapse of such reasonable period of time as the Board of
               Directors may from time to time establish for reasons of
               administrative convenience.

         SECTION 4.4 ESCROW. The Secretary or such other escrow holder as the
Board of Directors may appoint shall retain physical custody of the certificates
representing Restricted Stock, including shares of Restricted Stock issued
pursuant to Section 3.6, until all of the Restrictions expire or shall have been
removed; provided, however, that in no event shall the Executive retain physical
custody of any certificates representing Restricted Stock issued to him.

         SECTION 4.5 NOTICES. Any notice to be given under the terms of this
Agreement to the Corporation shall be addressed to the Corporation in care of
its Secretary, and any notice to be given to the Executive shall be addressed to
him at the address given beneath his signature hereto. By a notice given
pursuant to this Section 4.5, either party may hereafter designate a different
address for notices to be given to it or him. Any notice which is required to be
given to the Executive shall, if the Executive is then deceased, be given to the
Executive's personal representative if such representative has previously
informed the Corporation of his status and address by written notice under this
Section 4.5. Any notice shall have been deemed duly given when enclosed in a
properly sealed envelope or wrapper addressed as aforesaid, deposited (with
postage prepaid) in a post office or branch post office regularly maintained by
the United States Postal Service.

         SECTION 4.6 RIGHTS AS STOCKHOLDER. Except as otherwise provided herein,
the Executive, upon the issuance of a new share certificate pursuant to Sections
3.3 and 4.3, shall have all the rights of a stockholder with respect to his
Restricted Stock, including the right to vote all of the shares whether vested
or unvested and the right to receive all dividends or other distributions paid
or made with respect to all of the shares whether vested or unvested. The
Executive shall have all of the rights as a stockholder with respect to any
shares of Restricted Stock which have not vested.


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         SECTION 4.7 TITLES. Titles are provided herein for convenience only and
are not to serve as a basis for interpretation or construction of this
Agreement.

         SECTION 4.8 CONFORMITY TO SECURITIES LAWS. This Agreement is intended
to conform to the extent necessary with all provisions of the Securities Act and
the Exchange Act and any and all regulations and rules promulgated by the
Securities and Exchange Commission thereunder, including without limitation Rule
16b-3. Notwithstanding anything herein to the contrary, this Agreement shall be
administered, and the Restricted Stock shall be issued, only in such a manner as
to conform to such laws, rules and regulations. To the extent permitted by
applicable law, this Agreement and the Restricted Stock issued hereunder shall
be deemed amended to the extent necessary to conform to such laws, rules and
regulations.

         SECTION 4.9 AMENDMENT. This Agreement may be amended only by a writing
executed by the parties hereto which specifically states that it is amending
this Agreement.

         SECTION 4.10 GOVERNING LAW. The laws of the State of Delaware shall
govern the interpretation, validity, administration, enforcement and performance
of the terms of this Agreement regardless of the law that might be applied under
principles of conflicts of laws.


IN WITNESS HEREOF, this Agreement has been executed and delivered by the parties
hereto.






                                             VARSITY GROUP INC.




                                             By
                                                --------------------------------

                                             Its
                                                 -------------------------------

THE EXECUTIVE OFFICER



-----------------------------------
Name


-----------------------------------
Address


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