DATED               2000







                           (1) AMANDA LOUISE STAVELEY

                       (2) EUROTELECOM CORPORATION LIMITED

                                (3) Q.TON LIMITED




           SHARE PURCHASE AND SUBSCRIPTION AND SHAREHOLDERS AGREEMENT
                          RELATING TO AN INVESTMENT IN
                                  Q.TON LIMITED




                             [MCGRIGOR DONALD LOGO]

                            63 Queen Victoria Street
                                     LONDON
                                    EC4N 4ST
                            Telephone: 0171 329 3299
                            Facsimile: 0171 329 4000
                         E-Mail: enquiries@mcgrigors.com
                       Web Site: http://www.mcgrigors.com

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                                      INDEX

CLAUSE                                                                     PAGE

1        INTERPRETATION                                                     1
2        PURCHASE OF AND SUBSCRIPTION FOR SHARES                            4
3        COMPLETION                                                         5
4        MANAGEMENT                                                         6
5        WARRANTIES AND INDEMNITY                                           6
6        EXISTING SHAREHOLDER'S UNDERTAKINGS                                8
7        INVESTOR DIRECTOR                                                  10
8        FUTURE TRANSACTIONS                                                10
9        BOARD MEETINGS AND OTHER ADMINISTRATIVE MATTERS                    12
10       EXISTING SHAREHOLDER AND HER ASSOCIATE'S SHAREHOLDINGS             13
11       CONSENTS AND APPROVALS                                             14
12       ADHERENCE AND ASSIGNMENT                                           14
13       DISCLOSURE OF INFORMATION                                          14
14       COMPLIANCE                                                         14
15       SUPREMACY                                                          15
16       GENERAL                                                            15
17       NOTICES                                                            15
18       LAW AND JURISDICTION                                               16

SCHEDULE

PART 1   THE EXISTING SHAREHOLDER                                           17
PART 2   THE COMPANY                                                        18
PART 3   WARRANTIES                                                         19
PART 4   THE PROPERTIES                                                     27
PART 5   MAIN TERMS OF SERVICE CONTRACT                                     28

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AGREED FORM DOCUMENTS

NEW ARTICLES
RESOLUTIONS
TAX UNDERTAKING

<PAGE>

THIS AGREEMENT IS MADE                                        2000


BETWEEN

(1)      AMANDA LOUISE STAVELEY of 76/78 High Street, Bottisham, Cambridge,
         Cambridgeshire, CB5 9BA (the "EXISTING SHAREHOLDER");

(2)      EUROTELECOM CORPORATION LIMITED, a company registered in England under
         number 3184949 whose registered office is at Embankment House, Acorn
         Business Park, Woodseats Close, Sheffield S8 0TB (hereinafter together
         with its successors and assignees whomsoever called the "INVESTOR");
         and

(3)      Q.TON LIMITED, a company registered in England and Wales under number
         3650382 whose registered office is at Shakespeare House, 42 Newmarket
         Road, Cambridgeshire, CB5 2LA (the "COMPANY").


INTRODUCTION

(A)      The Company is a private company limited by shares incorporated in
         England under the Companies Act 1985 further details of which are
         contained in Part 2 of the Schedule.

(B)      The authorised share capital of the Company is (pound)1,000,000 divided
         into 1,000,000 Shares of (pound)1.00 each, 650,000 of which Shares have
         been allotted and issued and are fully paid up and are held as set out
         in Part 1 of the Schedule.

(C)      The Existing Shareholder is the beneficial owner and registered holder
         of the whole of the issued share capital of the Company.

(D)      The Company carries on the business of the development and operation of
         conference centre facilities (the "Business").

(E)      The Existing Shareholder and the Company and the Investor have agreed
         that the Investor will:-

         (i)      purchase 235,625 Shares from the Existing Shareholder on the
                  terms and subject to the conditions set out in this Agreement;
                  and

         (ii)     subscribe for 162,500 Shares.


NOW IT IS HEREBY AGREED as follows:-

1        INTERPRETATION

1.1      In this Agreement (including the foregoing recitals), except where the
         context otherwise requires, the following words and expressions shall
         have the following meanings:-

         A SHARES                   means Shares which are reclassified as "A"
                                    ordinary shares of(pound)1.00 each in the
                                    capital of the Company pursuant to the
                                    Resolutions;

                                       1
<PAGE>

         ACCOUNTS                   the draft audited balance sheet and profit
                                    and loss account and the trading and profit
                                    and loss account of the Company as at and
                                    for the period ended on the Account Date
                                    together with the notes thereto and the
                                    directors' reports and the auditors' reports
                                    included therewith;

         ACCOUNTS DATE              30 October 1999;

         AGREED                     FORM a form of words agreed between the
                                    Parties on or prior to the date hereof and
                                    for the purposes of identification
                                    initialled by or on behalf of the parties;

         ASSOCIATE                  (i)      in relation to an individual, any
                                             spouse, brother, sister or lineal
                                             ascendant or descendant and any
                                             company which is, or may be,
                                             directly or indirectly, controlled
                                             (within the meaning of Section 840
                                             of the Taxes Act 1988) by any one
                                             or more of the foregoing; and

                                    (ii)     in relation to a company, any
                                             subsidiary or subsidiary
                                             undertaking or holding company of
                                             such company and any other
                                             subsidiary or subsidiary
                                             undertaking of any holding company
                                             of such company.

         B SHARES                   means Shares which are reclassified as "B"
                                    ordinary shares of(pound)1.00 each in the
                                    capital of the Company pursuant to the
                                    Resolutions;

         BOARD                      the board of directors of the Company as
                                    from time constituted;

         COMPLETION                 means the completion of the purchase of the
                                    Sale Shares and the subscription for the
                                    Subscription Shares in accordance with this
                                    Agreement;

         DISCLOSURE                 LETTER the letter of even date with this
                                    Agreement containing disclosures to the
                                    Warranties from the Existing Shareholder to
                                    the Investor;

         EUROTELECOM                SHARES means 794,000 shares of Class A
                                    common stock with a par value of US$0.01
                                    each in the Capital of Eurotelecom
                                    Communications Inc., the Investor's holding
                                    company ("Eurotelecom");

         EVENT                      has the meaning ascribed in the Tax
                                    Undertaking;

         GROUP                      together the Company and every other company
                                    which is for the time being a subsidiary or
                                    holding company of the Company;

         GROUP COMPANY              any company for the time being in the Group;

         INTELLECTUAL PROPERTY      such of the following as may be owned, used
                                    or enjoyed by the Company or a Group
                                    Company:

                                       2
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                                    patents, trademarks, service marks,
                                    registered designs, design rights,
                                    prototypes, trade names, business names,
                                    domain names and applications for any of the
                                    foregoing; the right to apply for
                                    registration of any of the foregoing in any
                                    part of the world; any similar or analogous
                                    rights in any country; copyrights, design
                                    rights or any similar or analogous rights in
                                    any country, inventions, know-how,
                                    confidential knowledge or experience
                                    available to the Company; all contracts and
                                    agreements relating to any of the foregoing
                                    to which the Company is entitled; drawings,
                                    blueprints, plans, specifications, data and
                                    descriptive material, technical files and
                                    reports, designs and the benefit of all
                                    research, development and design work;

         INVESTOR APPROVAL          the approval of the Investor as referred to
                                    in Clause 11.1;

         INVESTOR DIRECTOR          the director of the Company appointed to
                                    that office by the Investor pursuant to this
                                    Agreement and the New Articles;

         LISTING                    the admission of all or any of the share
                                    capital of the Company to the Official List
                                    of The International Stock Exchange of the
                                    United Kingdom and Republic of Ireland
                                    Limited or the grant of permission for the
                                    same to be traded on any alternative
                                    securities market of such Stock Exchange or
                                    the admission of the same to, or the grant
                                    of permission by any like authority for the
                                    same to be dealt in on, any other equivalent
                                    or similar share market;

         MANAGEMENT                 ACCOUNTS the management accounts in respect
                                    of the Company as at 30 April 2000 and in
                                    respect of the 6 month period commencing 1
                                    November 1999 and ending 30 April 2000;

         NEW ARTICLES               the proposed new Articles of Association of
                                    the Company (in Agreed Form);

         PARTIES                    subject as provided in Clause 12, the
                                    parties to this Agreement, and PARTY means
                                    one of them;

         PROPERTIES                 the properties owned by the Company, details
                                    of which are set out in Part 4 of the
                                    Schedule;

         PROSPECTUS                 the prospectus issued by Eurotelecom in
                                    relation to an admission to the Alternative
                                    Investment Market and a placing on or about
                                    29 March 2000;

         RESOLUTIONS                the resolutions of the Company referred to
                                    in Clause 3.2.4;

         SALE SHARES                235,625 ordinary shares of(pound)1.00 each
                                    in the capital of the Company owned by the
                                    Existing Shareholder;

         SHARES                     shares in the capital of the Company (of
                                    whatever class);

         SHAREHOLDERS               collectively all (or, where the context
                                    requires, some) of the holders of Shares
                                    from time to time;

         SUBSCRIPTION SHARES        162,500 B Shares to be subscribed for by the
                                    Investor as provided in Clause 2.3;

                                       3
<PAGE>

         TAXATION                   has the meaning ascribed in the Tax
                                    Undertaking;

         TAX UNDERTAKING            the tax undertaking in the Agreed Form
                                    granted by the Existing Shareholder to the
                                    Investor;

         TAXES ACT                  the Income and Corporation Taxes Act 1988;

         WARRANTIES                 the undertakings, warranties and statements
                                    contained in Clause 5 and Part 3 of the
                                    Schedule and each and any of them.

1.2      Where clauses or paragraphs in this Agreement and Parts of the Schedule
         contain the expression "to the best of the knowledge, information and
         belief of the Existing Shareholder" or "so far as the Existing
         Shareholder is aware" or phrases having a similar meaning or effect,
         they shall be deemed to be followed by the words "having made due and
         careful enquiry" in every case.

1.3      Words and expressions defined in the Companies Act 1985 (as amended by
         the Companies Act 1989) shall, unless the context otherwise requires,
         have the same meanings where used in this Agreement.

1.4      Headings are used in this Agreement for convenience only and shall not
         affect its construction or interpretation.

1.5      In this Agreement references to Parts of the Schedule are to parts of
         the schedule to this Agreement and references to Clauses are to clauses
         in this Agreement and, unless otherwise specified, references to
         paragraphs are to paragraphs of the clause in which such reference
         appears and references to Annexures are to annexures to this Agreement.

1.6      In this Agreement reference to a person includes any legal or natural
         person, partnership, trust, company, government or local authority
         department or other body (whether corporate or unincorporate).

1.7      In this Agreement, unless the context does not so admit, reference to
         an individual or individuals shall include his/her or their respective
         executors and personal representatives.

1.8      In this Agreement, unless the context does not so admit, reference to
         the singular includes a reference to the plural and vice versa and
         reference to the masculine includes a reference to the feminine and
         neuter.

1.9      References in this Agreement to any statute or statutory provision
         shall be deemed to include reference to any statute, regulation or
         statutory instrument which amends, extends, consolidates or replaces
         the same (or shall have done so) and to any other regulation, statutory
         instrument or other subordinate legislation made thereunder or pursuant
         thereto.

2        PURCHASE OF AND SUBSCRIPTION FOR SHARES

2.1      The Existing Shareholder shall sell and the Purchaser shall purchase
         the Sale Shares with full title guarantee free from any charges, liens,
         encumbrances and other third party rights and with all rights attached
         thereto with effect from Completion in consideration for which the
         Investor shall procure the issue to the Existing Shareholder (or as she
         shall direct) of the Eurotelecom Shares.

2.2      The Existing Shareholder hereby represents and warrants to the Investor
         that she owns full legal and beneficial title to the Sale Shares and is
         entitled to sell and transfer the Sale Shares to the Investor free of
         all liens, charges, encumbrances and claims from third parties.

                                       4
<PAGE>

2.3      The Investor warrants and represents to the Existing Shareholder that
         the Eurotelecom Shares shall be validly issued credited as fully paid
         and free from any encumbrance or restriction, save as set out in the
         bylaws of Eurotelecom and the provisions of US securities laws as
         referred to in the Prospectus (a copy of which has been provided to the
         Existing Shareholder) and shall rank pari passu with the existing
         issued Class A common stock in the capital of Eurotelecom.

2.4      At the Completion, the Investor shall subscribe for the Subscription
         Shares at a price of (pound)4.615384615 per Share for an aggregate
         subscription amount of (pound)750,000 and the Company shall allot and
         issue the Subscription Shares to the Investor.

3        COMPLETION

3.1      Completion of the sale and purchase of the Sale Shares and the
         subscription for the Subscription Shares shall take place at the
         offices of the Investor's solicitors immediately following the
         execution of this Agreement.

3.2      At Completion:

         3.2.1    the Existing Shareholder shall deliver to the Investor a share
                  transfer in respect of the Sale Shares together with the share
                  certificates in respect of the Sale Shares;

         3.2.2    the Investor shall procure the allotment of the Eurotelecom
                  Shares to the Existing Shareholder and as soon as practicable
                  shall deliver to her a certificate for such Eurotelecom
                  Shares;

         3.2.3    the Investor shall pay to the Company subscription monies of
                  (pound)750,000 in respect of the Subscription Shares and the
                  Company shall allot and issue the Subscription Shares to the
                  Investor;

         3.2.4    the Existing Shareholder and the Company shall procure that
                  the Resolutions shall be duly passed and such Resolutions
                  shall include the following:-

                  (i)      reclassification of such of the Shares purchased and
                           subscribed for by the Investor pursuant to this
                           Agreement as B Shares;

                  (ii)     reclassification of all other Shares as A Shares;

                  (iii)    approval of the allotment and issue of the
                           Subscription Shares;

                  (iv)     approval of the registration of the Investor as the
                           holder of the Sale Shares in the Register of Members
                           (subject to stamping of the share transfer forms);

                  (v)      approval of the issue to the Investor of a share
                           certificate in respect of the Sale Shares and the
                           Subscription Shares;

                  (vi)     approve the appointment of David Linell and Philip
                           Derry as Investor Directors;

         3.2.5    the Existing Shareholder shall deliver the duly executed Tax
                  Undertaking to the Investor.

                                       5
<PAGE>

4        MANAGEMENT

4.1      The Parties agree that the Company shall continue to be managed by its
         existing management personnel (including the Existing Shareholder),
         subject to the direction of the Board, and that at all times all such
         management personnel shall enter into written employment agreements
         with the Company on terms approved by the Board.

4.2      The Existing Shareholder agrees that she shall enter into a service
         contract with the Company as soon as practicable following Completion,
         the main terms of which are set out in Part 5 of the Schedule.

4.3      The Investor shall procure that the Existing Shareholder shall be
         appointed as a director of Eurotelecom as soon as practicable following
         Completion on terms to be agreed between the parties acting reasonably,
         subject to the Existing Shareholder providing a completed Directors
         Questionnaire to Eurotelecom in terms which are satisfactory to
         Eurotelecom.

4.4      The Parties agree that all intellectual property rights developed by
         the Company in the course of its business shall be owned by and
         registered to the Company.

4.5      The Parties agree that all employees engaged by the Company shall be
         required to enter into employment agreements with the Company under the
         terms of which, inter alia, any intellectual property rights devised,
         invented or developed by any employee(s) during the course of their
         employment or in the operation of the Company's business shall be
         legally and beneficially owned by the Company.

5        WARRANTIES AND INDEMNITY

5.1      In consideration of the Investor agreeing to enter into this Agreement,
         to purchase the Sale Shares and to subscribe for the Subscription
         Shares, the Existing Shareholder hereby represents and warrants to the
         Investor in the terms set out in Part 3 of the Schedule.

5.2      In consideration of the Investor agreeing to enter into this Agreement,
         to purchase the Sale Shares and to subscribe for the Subscription
         Shares, the Company hereby represents and warrants to the Investor in
         the terms set out in Part 3 of the Schedule.

5.3      The Warranties shall be given at the date of Completion.

5.4      The Existing Shareholder and the Company acknowledge that they are
         aware that the Investor, when agreeing to purchase the Sale Shares and
         subscribe for the Subscription Shares is or will be relying on the
         accuracy of the Warranties (save only as disclosed in the Disclosure
         Letter) and on the Tax Undertaking. The Warranties and the Tax
         Undertaking shall survive Completion of the purchase of the Sale Shares
         and the subscription for the Subscription Shares by the Investor.

5.5      Each Warranty which is set out in a separate paragraph, or which could
         be treated as a separate Warranty, shall be construed independently of
         any other to the intent that the rights of the Investor under, and the
         meaning given to, any one such Warranty shall not be restricted by
         reference to any other Warranty.

5.6      If the Investor makes a claim against the Existing Shareholder in
         relation to any breach of Warranty but, in relation to the same subject
         matter, does not make (or, having made, does not succeed with), any
         claim against the Company under Clause 5.2, the Existing Shareholder
         shall not have or pursue any claim or third party action to join in,
         claim against, seek a contribution from or otherwise claim or seek
         damages or compensation from the Company or any other Group Company in
         respect of any such claim and the Existing Shareholder hereby confirms
         to the Investor that neither the Company nor any Group Company has
         entered into or will enter into any indemnity or other agreement or
         arrangement concerning the liabilities of the Existing Shareholder for
         any breach of the Warranties.

                                       6
<PAGE>

5.7      The Existing Shareholder and the Company shall not be liable in respect
         of any claim under the Warranties to the extent that the matter or
         matters giving rise to such a claim are fairly disclosed in the
         Disclosure Letter. The Existing Shareholder and the Company each
         undertake to the Investor that any particulars of such matter or
         matters are true and accurate in all material respects and are not
         misleading in any material respect.

5.8      The aggregate liability of the Existing Shareholder in respect of any
         breach or breaches of the Warranties and the Tax Undertaking shall be
         limited to a maximum sum of (pound)750,000 ("the Maximum Amount").

5.9      Neither the Existing Shareholder nor the Company shall have any
         liability under the Warranties and the Tax Undertaking unless and until
         the liability thereunder exceeds (pound)35,000 and thereafter the
         Existing Shareholder shall be liable for the entire amount up to the
         Maximum Amount.

5.10     The Existing Shareholder and the Company shall not be liable in respect
         of any claim under the Warranties or the Tax Undertaking (as the case
         may be) unless the claim shall have been notified to her before the
         expiry of a period of 12 months from Completion in the case of a claim
         under the Warranties and 36 months from Completion in the case of a
         claim under the Tax Undertaking. Any claim so notified will cease to be
         recoverable if legal proceedings in respect of such claim have not been
         commenced within 15 months from Completion in the case of a claim under
         the Warranties and 48 months from Completion in the case of a claim
         under the Tax Undertaking (unless settled, compromised or withdrawn
         within such period). In this respect, legal proceedings shall include
         commencement of any agreed arbitration. Notice of a claim shall include
         reasonable details of the nature and substance of the claim.

5.11     No liability or increase in liability (as the case may be) shall attach
         to the Existing Shareholder or the Company in respect of a claim under
         this Agreement to the extent that such claim arises or is increased as
         a consequence of a change in the law after the date hereof.

5.12     In the event that the Company is entitled to recover from a third party
         (whether by payment, discount, credit, relief or otherwise howsoever)
         any sum in relation to any loss, liability or damage which is the
         subject of a claim under the Warranties or the Tax Undertaking, the
         Company shall take (at the expense of the Existing Shareholder) such
         reasonable steps or proceedings as she may reasonably require and shall
         act in accordance with any such requirements subject to the Company
         being indemnified by the Existing Shareholder against all reasonable
         costs and expenses incurred in connection therewith and shall keep the
         Investor promptly informed of the progress of any such steps,
         proceedings or actions.

5.13     In the event of the Existing Shareholder or the Company having paid to
         the Investor an amount in respect of a claim under the Warranties or
         the Tax Undertaking and subsequent to the date of making such payment
         the Investor recovers from a third party (whether by payment, discount,
         credit, relief or otherwise howsoever) a sum which is referable to that
         payment then the Investor shall as soon as reasonably practicable repay
         to the Existing Shareholder or the Company of so much of the amount
         paid by the third party as does not exceed the sum paid by the Existing
         Shareholder or the Company to the Investor less the reasonable costs of
         the Investor in recovering such sum.

5.14     If any claim under the Warranties shall arise by reason of some
         liability of the Company which, at the time the claim is notified to
         the Existing Shareholder, is contingent only, the Existing Shareholder
         shall not be under any obligation to make any payment to the Investor
         in respect of such claim until such time as the contingent liability
         shall become an actual liability.

                                       7
<PAGE>

5.15     Nothing herein or in the Warranties shall be deemed to relieve the
         Investor from any common law or other duty to mitigate any loss or
         damage incurred by it.

5.16     Any amount paid by the Existing Shareholder to the Investor in respect
         of any breach of the Warranties shall be treated as a reduction in the
         consideration for the Sale Shares.

5.17     The Investor warrants to the Existing Shareholder that the Investor has
         power to enter into this Agreement and to perform the obligations
         expressed to be assumed by it and the Investor and Eurotelecom have
         taken or will, as soon as reasonably practicable, take all necessary
         corporate action to authorise the execution, delivery and performance
         of this Agreement and the issue of the Eurotelecom Shares.

6        EXISTING SHAREHOLDER'S UNDERTAKINGS

6.1      In consideration of the Investor entering into or becoming party to
         this Agreement, the Existing Shareholder undertakes to the Company (for
         itself and as agent and trustee for each Group Company from time to
         time) and (as a separate undertaking) to the Investor that:-

         6.1.1    for so long as the Existing Shareholder is employed by the
                  Company or any other Group Company she will devote such time
                  and attention to the business of the Group as is required for
                  the proper performance of her duties as Chief Executive
                  Officer and will use her best endeavours to develop the
                  business and interests of the Group and will not be concerned
                  with any other business either which is in competition with
                  the Business without the prior written approval of the
                  Investor Director or which interferes with the proper
                  performance of her duties as Chief Executive Officer;

         6.1.2    upon her ceasing (whether of her own volition or otherwise) to
                  be employed by or to be a director of any Group Company she
                  will not for a period of one year from the date of such
                  cessation (or, if she ceases to be an employee on a different
                  date from that on which she ceases to be a director, the later
                  of such dates) (the "Cessation Date"), whether on her own
                  account or on behalf of the person, firm or company:-

                  6.1.2.1  solicit (in connection with any business of a type
                           then carried on by the Group) interfere with or
                           endeavour to entice away from any Group Company any
                           person, firm or company who at any time during the
                           period of one year immediately preceding such
                           cessation, was either to her knowledge a material
                           customer, client, supplier, agent or an employee (not
                           being a junior employee) or consultant (by whatever
                           title called) of a Group Company; or

                  6.1.2.2  seek to disrupt or otherwise interfere with or
                           prejudice the continuance of the supply of goods or
                           services to any Group Company or the terms of any
                           such supply; or

                  6.1.2.3  carry on, engage in or be concerned or interested
                           either as principal or as a partner or employee of
                           any other person within the United Kingdom in any
                           business or activity which competes with the Business
                           or any other businesses and activities (or, if more
                           than one, any of them) in which any Group Company is
                           engaged at the date of such cessation and with which
                           the Existing Shareholder has had any personal
                           involvement;

         6.1.3    she will not at any time after the Cessation Date represent
                  herself as still being (i) an employee or a director of or as
                  otherwise having any authority to act on behalf of any Group
                  Company or (ii) save only in respect of any shareholding in
                  the Company for so long as she retains the same, otherwise
                  interested in any Group Company or its business and affairs;

                                       8
<PAGE>

         6.1.4    she will not at any time whilst an employee, director or
                  otherwise interested in the Group (save in so far as is
                  reasonably necessary to fulfil his duties to the Group) or at
                  any time thereafter, directly or indirectly use or disclose or
                  communicate to any person, firm or company any information
                  concerning the internal or external affairs, business methods,
                  processes, systems, inventions, plans or research and
                  development of the Group or those of its customers, clients or
                  suppliers and which may be reasonably regarded as being
                  confidential to the Group or to such persons (other than
                  information which the Existing Shareholder is required to
                  disclose by law or which is for the relevant time being in the
                  public domain other than by reason of wrongful disclosure of
                  the same by the Existing Shareholder) and will use her
                  reasonable endeavours to prevent the publication or disclosure
                  of any such information by any third party.

6.2      Nothing in Clause 6.1 shall prevent or restrict the Existing
         Shareholder from and in continuing her existing business interests
         including without limitation her involvement in the establishment
         (including taking a shareholding in) and management of Project Darwin
         (a proposed incubator unit in Cambridge with conference facilities,
         details of which have been provided to the Investor).

6.3      The Existing Shareholder hereby acknowledges that the foregoing
         undertakings and agreements by and on her part are part of the
         consideration afforded to the Investor in return for its agreement to
         purchase the Sale Shares and subscribe for the Subscription Shares and
         that (after taking legal advice) she considers the foregoing
         restrictions and agreements to be reasonable and necessary for the
         protection of the legitimate commercial interests of the Investor. It
         is hereby agreed that if any such undertaking or agreement is held to
         be void or invalid but would not have been so held if part of the
         wording were deleted or its extent reduced, then such undertaking shall
         apply with such deletions or reductions as may be necessary to make the
         same valid and enforceable.

6.4      The Existing Shareholder hereby warrants and undertakes to the Company
         and the Investor that she is free to continue her employment with the
         Company and (as the case may be) is not or will not be in breach of any
         other contract of employment (whether past or now subsisting) or be
         liable to any action (whether for damages, injunction, specific
         performance or otherwise) relating to any such contract or be in breach
         of any duty of confidence or any undertaking or arrangement relating to
         any industrial or intellectual property rights or be liable to any
         action (whether for damages, injunction, specific performance or
         otherwise) relating to any continuous or continuing obligations under
         any such contract, and that any Group Company is free to offer or
         continue (as the case may be) her employment without being liable to
         any other person for so offering or continuing such employment and
         subsequently employing her.

6.5      The Existing Shareholder hereby agrees and accepts that if she shall
         commit a material breach of the provisions of Clause 6.1 and (if such
         breach is capable of remedy) if the Existing Shareholder shall fail to
         remedy the same having been given notice by the Investor or the Company
         so to do then, such breach shall be deemed to constitute, for the
         purposes of the Existing Shareholder's contract of employment with the
         Company serious misconduct on the part of the Existing Shareholder and,
         accordingly, render the Existing Shareholder liable to summary
         dismissal (without claim for compensation) from her employment by the
         Company forthwith without liability or payment of compensation. If the
         Existing Shareholder becomes liable to summary dismissal pursuant to
         the foregoing provisions of this Clause then the Company shall, upon
         request in writing by the Investor, forthwith dismiss the Existing
         Shareholder from her employment by the Company.

                                       9
<PAGE>

7        INVESTOR DIRECTOR

7.1      It is agreed between the Parties that the Investor shall have the right
         to appoint and remove two Investor Directors (and to replace any such
         persons from time to time) and to appoint alternate directors from time
         to time and the Company shall reimburse the Investor Directors for all
         out of pocket expenses reasonably incurred by them in connection with
         the performance of their duties as directors of the Company.

8        FUTURE TRANSACTIONS

8.1      The Company hereby undertakes to the Investor that, save with Investor
         Approval:-

         8.1.1    save in respect of borrowings from the Company's bankers
                  within the limit referred to in Clause 8.1.2 below, no Group
                  Company shall create or issue or allow to come into being any
                  mortgage, charge, lien or other encumbrance (save for liens
                  arising in the ordinary course of business) upon the whole or
                  any part of its undertaking, property or other assets or
                  uncalled capital or revenue or create or issue any debenture
                  or debenture stock;

         8.1.2    no Group Company shall borrow any monies or obtain any advance
                  or credit (other than normal trade credit) if as a result of
                  such borrowing, advance or credit the aggregate amount of all
                  borrowings by the Group (excluding existing borrowings) would
                  exceed (pound)25,000;

         8.1.3    no Group Company shall sell, assign, factor, discount or
                  otherwise dispose of all or any material part of its debts or
                  any interest therein;

         8.1.4    save to the extent provided for in any annual budget which has
                  been approved by the Investor Director, no Group Company shall
                  acquire or agree to acquire any fixed or capital asset or make
                  or agree to make any capital expenditure except, in any single
                  accounting period of the Company, for individual items not in
                  excess of (pound)1000, provided always also that the excess of
                  capital expenditure over budget does not exceed (pound)5,000
                  for the relevant financial year;

         8.1.5    no Group Company shall increase, reduce or otherwise alter its
                  authorised or issued share capital or its capital structure or
                  grant any options or other like rights to acquire any Shares
                  or securities convertible into Shares or make any payment to
                  any person (whether or not a member) for giving up his right
                  to any share capital on its cancellation or extinguishment;

         8.1.6    no Group Company shall establish any pension, bonus, profit
                  sharing or other incentive scheme or plan for directors and/or
                  employees;

         8.1.7    no Group Company shall alter its Memorandum or Articles of
                  Association or, in the case of any overseas subsidiary, its
                  equivalent documents;

         8.1.8    no Group Company shall take any steps to have any Group
                  Company wound up whether for the purposes of amalgamation or
                  reconstruction or otherwise unless a registered insolvency
                  practitioner shall have advised that such Group Company is
                  required to be wound up by reason of having become insolvent;

         8.1.9    no Group Company shall sell, transfer, lease, assign or grant
                  any licence in respect of, or otherwise dispose of the whole
                  or any material part of its undertaking, property or other
                  assets (whether by one transaction or a series of transactions
                  whether related or not) other than the sale of current assets
                  in the ordinary course of trading;

                                       10
<PAGE>

         8.1.10   no Group Company shall sell, transfer or otherwise dispose of
                  any subsidiary or associated company or any shares or any
                  interest therein;

         8.1.11   no Group Company shall give any guarantee or indemnity other
                  than in the ordinary course of trading;

         8.1.12   no Group Company shall make any loan or advance or provide any
                  credit other than:-

                  8.1.12.1 for the deposit of monies with a bank which is an
                           authorised institution under the Banking Act 1987;

                  8.1.12.2 normal trade credit;

                  8.1.12.3 loans to employees of such Group Company not
                           exceeding(pound)500 at any one time outstanding in
                           the aggregate;

         8.1.13   no Group Company shall subscribe for, purchase or acquire any
                  shares, debentures, debenture stock, mortgages or securities
                  or interest in any other company, trust, partnership or other
                  body (in each case whether or not having separate legal
                  personalities);

         8.1.14   no Group Company shall incorporate or otherwise set up or
                  acquire any subsidiary or associated company or new business
                  or any interest therein or, other than in the ordinary course
                  of business, acquire or dispose of any material assets;

         8.1.15   no Group Company shall enter into any joint venture,
                  partnership, consortium or other similar arrangement;

         8.1.16   no Group Company shall make any material change in the nature
                  of its business;

         8.1.17   no Group Company shall enter into any contract or other
                  agreement or transaction or other arrangement otherwise than
                  in the ordinary course of trading and on an arms length basis;

         8.1.18   no Group Company shall change any auditor, or its accounting
                  reference date or its accounting policies (save where required
                  to do so by any legislation or authority);

         8.1.19   otherwise than at a meeting of the Board, no Group Company
                  shall appoint or remove any director or appoint any committee
                  of its board of directors or take any decisions which are
                  material to the Group as a whole;

         8.1.20   no Group Company shall, in relation to any such senior
                  executive as is referred to in Clause 8.1.21 below agree to or
                  accept any material variation in his or her terms of
                  employment (including any increase in emoluments), give any
                  such consent (if any) as is referred to in his or her contract
                  of employment, waive, or agree to take no action in respect of
                  any material breach by any such person of his or her contract
                  of employment or terminate the employment of any such person;

         8.1.21   no Group Company shall employ or agree to employ (i) any
                  senior executive (being an employee whose emoluments and
                  pension benefits shall be at an annual rate in excess of
                  (pound)50,000); or (ii) any person on terms such that such
                  employment may not lawfully be terminated by such Group
                  Company without compensation upon three months' notice or
                  less;

                                       11
<PAGE>

         8.1.22   in the case of the Company or any other Group Company which is
                  not a wholly-owned subsidiary of the Company, declare or pay
                  any dividend (except out of cash resources not required for
                  the Company's business) or make any distribution or agree to
                  capitalise any reserves or apply any amount for the time being
                  standing to the credit of its share premium account or capital
                  redemption reserve for any purpose; and

         8.1.23   the Company shall not appoint any merchant bank or other
                  adviser to advise in relation to a Listing or takeover or
                  agree to the terms of appointment (including remuneration) of
                  any such bank or other adviser.

8.2      The Existing Shareholder agrees and undertakes to the Investor that she
         shall procure all business opportunities or ventures which relate to
         the Company's Business which are identified or pursued by the Existing
         Shareholder shall be introduced to the Company to give the Company the
         opportunity to participate therein as soon as reasonably practicable
         and the Parties acknowledge that it is their intention to develop
         further new business opportunities within the business operations of
         the Company.

8.3      Each Group Company shall insure with an insurance company of repute and
         keep so insured itself and all its assets against appropriate risks to
         the extent of and in accordance with good commercial practice.

9        BOARD MEETINGS AND OTHER ADMINISTRATIVE MATTERS

         The Company agrees with the Investor that:-

9.1      (unless an Investor Director from time to time agrees otherwise) a
         meeting of the Board shall be convened and held at least once in every
         quarter or more frequently as required;

9.2      (unless an Investor Director agrees otherwise in relation to any
         particular meeting), there shall be given to the Investor and each
         director of the Company (including each Investor Director) reasonable
         prior written notice of any meeting of the Board and every such notice
         shall be accompanied by a written agenda specifying the business of
         such meeting;

9.3      no business shall be transacted at any meeting of the Board save for
         that specified in the agenda for such meeting unless all Directors
         shall otherwise agree;

9.4      the Company shall provide to the Investor such financial and other
         information concerning the Group as the Investor may from time to time
         require and in that regard shall permit any officer or authorised
         representative of the Investor from time to time upon reasonable prior
         notice to inspect (and take copies of) such of the books, papers,
         documents and other records of any Group Company as such person may
         stipulate and shall in any event provide to the Investor:

         9.4.1    within two weeks after the end of each month, management
                  accounts for the Group in respect of such month and each
                  preceding month during the relevant financial year, such
                  management accounts to contain trading and profit and loss
                  accounts, balance sheets, cashflow forecasts and details as to
                  forward forecasts be in such format as the Board may from time
                  to time agree;

         9.4.2    within fourteen days after each meeting of the Board of or any
                  committee of the Board, minutes in respect of such meeting;
                  and

         9.4.3    within seven days of the Company becoming aware of the same,
                  details of any litigation or arbitration or other like
                  proceedings being commenced or threatened against any Group
                  Company (other than proceedings for the recovery of debts not
                  in excess of (pound)5,000); and

                                       12
<PAGE>

         9.4.4    promptly upon the same becoming available, documents
                  concerning transactions or events which are or may be material
                  to the business and affairs of the Group;

9.5      the Company shall (insofar as it is able) procure that the statutory
         audited consolidated accounts of the Group are prepared and sent to
         Shareholders within three months of the last day of the period to which
         they relate;

9.6      the Company shall provide to the Investor and the Investor Director not
         later than 30 days prior to the end of any financial year of the
         Company a draft detailed operating plan and financial budget for the
         Group for the next succeeding financial year and, not later than the
         end of each financial year (but after consultation with and obtaining
         the approval of the Investor Director (and the Investor in the case of
         proposed capital expenditure)) the Board shall adopt a plan and budget
         as aforesaid for the next succeeding financial year; and

9.7      following the adoption of any such plan and budget as aforesaid, save
         with the prior approval of the Board, no Group Company shall (so far as
         the same lies within its control) either depart from any of the general
         strategies, policies or plans laid down thereby or make any material
         expenditure or incur any material liabilities which are not
         contemplated therein or are in excess of those contemplated thereby.

10       EXISTING SHAREHOLDER AND HER ASSOCIATE'S SHAREHOLDINGS

10.1     The Existing Shareholder hereby undertakes to the Investor that, save
         with Investor Approval or as required by the New Articles or as
         permitted under Clause 10.2, she will not, and shall procure that her
         Associates will not, for so long as the Investor owns any "B" Shares
         dispose of or agree to dispose or enter into any agreement or
         arrangement (including any mortgage or charge) by virtue of which she
         will or may become obliged to dispose of all or any Shares of which she
         or her Associates are now or may subsequently become the registered
         holder and/or beneficial owner, or of any interest therein.

10.2     The Existing Shareholder (or an Associate of the Existing Shareholder)
         may make any such transfer of a Share which is permitted under the
         terms of the New Articles provided that, as a pre-condition of so
         doing, the Existing Shareholder shall procure that the proposed
         transferee shall have undertaken in terms acceptable to the Investor in
         favour of the Investor (and in such form as the Investor may reasonably
         require) (i) acknowledging that he will fall to be treated as an
         Associate of the Existing Shareholder for the purposes of this
         Agreement and the New Articles and (ii) covenanting to be bound by the
         provisions of this Agreement (including Clause 10.1 but excluding the
         Warranties and Clauses 6.1.1 to 6.1.3 inclusive) to such extent as the
         Investor may reasonably require.

                                       13
<PAGE>

11       CONSENTS AND APPROVALS

11.1     For the purposes of this Agreement the expression "Investor Approval"
         means, subject as provided in Clause 11.3, the prior written consent or
         approval of the Investor.

11.2     At any time when, and for so long as, there are no Investor Directors
         in office as directors of the Company any reference in this Agreement
         to the consent or approval of the Investor Directors shall take effect
         as reference to such other persons (if any) as the Investor shall have,
         by written notice to the Company, designated for this purpose or,
         failing any persons being so designated, to Investor Approval.

11.3     The Investor may, by notice to the Company, delegate to an Investor
         Director or such other person (if any) as they think fit, the right to
         give or decline to give on behalf of the Investor consent or approval
         to any matter in relation to which Investor Approval is required to be
         sought under the terms of this Agreement. The Investor may, by further
         notice to the Company, terminate any such delegation at any time and
         for any reason.

12       ADHERENCE AND ASSIGNMENT

12.1     Notwithstanding any provision of this Agreement or the New Articles to
         the contrary no allotment or transfer of any Share shall be made or
         entered into or registered unless or until the proposed allottee or
         transferee (as the case may be), if not already a party to this
         Agreement, has entered into an agreement in terms acceptable to the
         Investor in favour of the Company and the Shareholders covenanting to
         be bound by the terms and conditions of this Agreement, including this
         Clause but excluding the Warranties and Clauses 6.1.1 to 6.1.3
         inclusive, in such manner and to such extent as the Company and the
         Investor may reasonably require.

12.2     Subject as provided in Clause 12.3, the rights of each of the Parties
         under this Agreement are personal and may not be assigned or otherwise
         transferred save with the prior written consent of the other Parties.

12.3     If the Investor transfers any Shares to a third party in accordance
         with the New Articles then the Investor may assign to such third party
         all or any part of its rights under this Agreement (save for the
         Warranties and the Tax Undertaking) and following any such transfer
         (and subject to any compliance by the third party with Clause 12.1)
         such third party shall, as from the date of such transfer, be treated
         if it were also "the Investor" for all purposes of this Agreement.

13       DISCLOSURE OF INFORMATION

         Save as required by law or in relation to information which is publicly
         available (other than by reason of any wrongful disclosure of the
         same), none of the Company, the Existing Shareholder or the Investor
         shall make any announcement concerning or otherwise disclose or divulge
         any information concerning the Investor's involvement with or interest
         in the Company including (without limitation) any of the terms set
         forth in this Agreement except to the extent otherwise agreed in
         writing by all of the Parties.

14       COMPLIANCE

14.1     The Company undertakes to the Investor that it will procure that each
         Group Company for the time being shall observe and perform the
         provisions of this Agreement to be observed and performed by a Group
         Company.

14.2     The Existing Shareholder shall, insofar as it lies within her power for
         the time being, take all action necessary to ensure compliance by the
         Company and each Group Company with its obligations and other
         commitments both under this Agreement and the New Articles.

                                       14
<PAGE>

15       SUPREMACY

         In the event of any conflict between the terms of this Agreement and
         the New Articles then, as between the Parties hereto, the provisions of
         this Agreement shall prevail and, if so required by the Investor, the
         Parties shall procure that the New Articles shall be amended to such
         extent as the Investor may reasonably require in order that such
         conflict be removed.

16       GENERAL

16.1     Nothing contained in this Agreement shall constitute or be deemed to
         constitute a partnership between the Parties hereto or any of them and
         no Party shall hold himself out as an agent for any other Party save
         with the prior consent of such other Party.

16.2     The Agreement represents the entire agreement between the Parties in
         relation to the matters the subject matter hereof.

16.3     The rights of the Investor under this Agreement are independent,
         cumulative and without prejudice to all other rights available to it
         and the exercise or non-exercise of any such rights shall not prejudice
         or constitute a waiver of any other rights the Investor may have
         whether under this Agreement or otherwise.

16.4     The Company and the Existing Shareholder shall procure the passing of
         such resolutions, execute such documents and waivers and generally do
         everything further required by the Investor effectively to comply with
         their obligations under this Agreement and to vest the full benefit of
         this Agreement in the Investor.

16.5     Each of the Parties to this Agreement shall bear his or its own legal
         costs in respect thereof.

16.6     No variation of this Agreement shall be binding on any Party hereto
         unless and to the extent that the same is recorded in a written
         document executed by such Party but where any such document exists and
         is so signed such Party shall not allege that the same is not binding
         by virtue of an absence of consideration.

17       NOTICES

17.1     Any notice given under or in connection with this Agreement shall be in
         writing and signed by the Party giving notice.

17.2     The respective addresses for service of notices under this Agreement
         shall be those set out at the outset of this Agreement provided however
         that any Party may, by written notice to the others, substitute another
         address for the service of notices on that Party hereunder.

17.3     Notices may be given by being delivered to the notice address of the
         addressee (in which case the notice shall be deemed to be served at the
         time of delivery) or by being sent by facsimile (in which case the
         notice shall be deemed to be served upon completion of the
         transmission) or by being sent by first class post (in which case the
         notice shall be deemed to be served 24 hours after time of posting).
         Notices deemed served after 6.00pm on any day shall be deemed served at
         9.00am on the next following business day.

17.4     In proving service of any notice, it shall be sufficient to prove that
         delivery was made or that the envelope containing the notice was
         properly addressed and posted or that the facsimile was transmitted to
         the correct number, as the case may be.

                                       15
<PAGE>

18       LAW AND JURISDICTION

         This Agreement shall be governed by the laws of England and the Parties
         hereby submit to the non-exclusive jurisdiction of the English Courts.


EXECUTED as a DEED by the Parties hereto on the day and year first before
written:-

                                       16
<PAGE>

                                    SCHEDULE

                                     PART 1

                            THE EXISTING SHAREHOLDER



                                                          NUMBER OF SHARES
NAME AND ADDRESS                                          OWNED AND HELD

Amanda Louise Staveley                                    650,000
76/78 High Street
Bottisham
Cambridge
Cambridgeshire
CB5 9BA

                                       17
<PAGE>

                                     PART 2

                                   THE COMPANY



DATE OF INCORPORATION:              15 October 1998

REGISTERED OFFICE:                  42 Newmarket Road, Cambridge,
                                    Cambridgeshire, CB5 2LA

SHARE CAPITAL AUTHORISED:           (pound)1,000,000

SHARE CAPITAL ISSUED:               (pound)650,000

SHAREHOLDERS                        NO OF SHARES HELD

Amanda Louise Staveley              650,000

DIRECTORS:                          Amanda Louise Staveley
                                    Andrew Burchall

SECRETARY:                          Lynda Harford

ACCOUNTING REFERENCE DATE:          30 October

AUDITORS:                           Saffery Champness

MORTGAGES, DEBENTURES
AND OTHER CHARGES:                  Charge contained in Escrow Agreement dated 3
                                    September 1999 in favour of The Master
                                    Fellows and Scholars of Trinity College
                                    Cambridge.

                                       18
<PAGE>

                                     PART 3

                                   WARRANTIES


1        INFORMATION

1.1      The information set out in the Recitals to this Agreement and in Parts
         1 and 2 of the Schedule is true, complete and accurate.

1.2      All written information annexed to the Disclosure Letter are true and
         complete copies of the originals.

1.3      All forecasts and projections in respect of the Company were prepared
         in good faith and after careful consideration and on the basis of
         assumptions which were and remain fair and realistic and neither the
         Existing Shareholder nor the Company is now actually aware of any fact
         or matter which will, or is likely to, result in any of such forecasts
         or projections not being achieved.

2        SHARE CAPITAL

         Save as created by this Agreement, there is no outstanding right to
         call for the issue of any share or loan capital of any Group Company.

3        ACCOUNTS

3.1      The Accounts were prepared in accordance with applicable accounting
         practice, comply with the requirements of the Companies Acts 1985 and
         give a true and fair view of the financial position of the Group at the
         Accounts Date and of the results for the period then ended.

3.2      The Management Accounts have been properly prepared in accordance with
         applicable accounting practice and using policies consistent with those
         adopted in the preparation of the Accounts and fairly reflect in all
         material respects the financial position of the Group as at 30 April
         2000 and for the six month period then ended.

3.3      All the accounts, books, ledgers, financial and other records, of
         whatsoever kind, of the Company are in its possession and fairly
         reflect the transactions of the Company in all material respects.

4        EVENTS SINCE THE ACCOUNTS DATE

4.1      Since the Accounts Date, no Group Company has entered into any
         transaction or done any such act or thing as is referred to in Clause
         8.1 save as expressly referred to or provided for in this Agreement and
         in addition (but without prejudice to the generality of the foregoing)
         each Group Company:-

         4.1.1    has carried on its business as a going concern in, and only
                  in, the ordinary course;

         4.1.2    has not incurred any liability other than in the ordinary
                  course of its business;

         4.1.3    has not entered into (whether in the ordinary course or not)
                  any long term, substantial, onerous or unusual obligations or
                  transactions including (without limitation) any capital
                  commitment involving more than (pound)5,000;

                                       19
<PAGE>

         4.1.4    has not made (or agreed to make) any change in the basis or
                  amount of the emoluments of or benefits for its directors or
                  any of its employees;

         4.1.5    has not paid, declared or made (or agreed so to do) any
                  dividend or other distribution;

         4.1.6    has not acquired or set up (or agreed so to do) any new
                  business, branch or subsidiary; and

         4.1.7    has not borrowed any moneys except from its bankers in the
                  ordinary course of business and within the limits of the
                  facilities available to it from such bankers.

4.2      Since the Accounts Date there has not been any deterioration in the
         financial position or prospects of the Group (whether in consequence of
         normal trading or otherwise).

5        DEBTS

5.1      So far as the Existing Shareholder is aware, all debts now owing to the
         Company are good and collectable in full in the ordinary course of
         business within 60 days of the date of this Agreement.

6        ASSETS

6.1      No asset in the actual, reputed or apparent possession or ownership of
         a Group Company, or which is reflected in the Accounts or in the
         Management Accounts was or is being acquired on terms that title or any
         security or other interest therein was reserved to any other party, or
         was or is being acquired under any bill of sale, hire or hire purchase
         agreement, conditional sale, credit sale, deferred payment or similar
         agreement, and each such asset is (save to the extent that it has been
         profitably sold in the ordinary course of normal trading) in the
         beneficial ownership and sole possession and control of such Group
         Company.

7        EMPLOYMENT

7.1      The individuals named in the Disclosure Letter are all of the
         directors, officers and employees of the Company and their terms and
         conditions of employment set out therein are true, accurate and
         complete in all material respects. There is no person who has accepted
         an offer of employment made by the Company whose employment has yet to
         start and there are no offers of employment which have been issued and
         remain open for acceptance.

7.2      There is not in existence any contract of employment with any employee
         of a Group Company which cannot be terminated by three months' notice
         or less without giving rise to any claim for damages or compensation
         (other than a statutory redundancy payment or statutory compensation
         for unfair dismissal).

7.3      No Group Company owes any amounts to, or has any outstanding
         obligations in respect of, any present or former directors, employees
         or shareholders of such company other than remuneration accrued during
         the month in which this Agreement has been entered into.

7.4      Save to the extent (if any) to which provision or allowance has been
         made in the Accounts:

         7.4.1    no Group Company has any liability for breach of any contract
                  of service or for services, for redundancy payments,
                  protective awards or for compensation for wrongful dismissal
                  or unfair dismissal or for failure to comply with any order
                  for the reinstatement or re-engagement of any employee or for
                  any other liability accruing from the termination or variation
                  of any contract of employment or for services; and

                                       20
<PAGE>

         7.4.2    no gratuitous payment has been made or promised in connection
                  with the actual or proposed termination or suspension of
                  employment or variation of any contract of employment of any
                  present or former director or employee.

7.5      There is no arrangement to which any Group Company contributes or may
         become liable to contribute under which benefits of any kind are
         payable to or in respect of any of the employees, directors or officers
         or any former employee or former director or former officer of any
         Group Company (or to any spouse or dependant of any of them) on
         retirement, on death or in the event of disability or sickness or in
         other similar circumstances.

7.6      All Intellectual Property which is or has been devised, invented or
         developed by an employee of any Group Company during the course of
         their employment has been assigned to and/or is solely and beneficially
         owned by such Group Company and no employee of any Group Company has
         acquired any rights in any Intellectual Property which has been
         devised, invented or developed by such Group Company.

7.7      The Company is not and never has been a party to and has no obligation
         and never has had any obligation to provide and does not participate in
         or contribute to and never has participated in or contributed to any
         pension scheme.

8        AUTHORITIES

8.1      So far as the Existing Shareholder is aware, each Group Company has
         obtained and complied with all permits, authorities, licences and
         consents (whether granted by public of private authority) necessary or
         used to carry on its business effectively and without hindrance in the
         manner and in the places in which its business is now carried on and
         there are no circumstances known to her which are likely to lead to the
         suspension, alteration or cancellation of any such permits,
         authorities, licences or consents, nor is there any agreement which
         restricts the fields within which it may carry on its business.

9        LITIGATION

9.1      No Group Company is engaged in, nor is any officer of any Group Company
         engaged in, any legal proceedings (including litigation, arbitration,
         prosecution or any hearing before any tribunal or official body). There
         are no such proceedings pending or threatened and so far as the
         Existing Shareholder is aware, there has been no act, omission or other
         occurrence which will or is likely to give rise to any such
         proceedings.

9.2      There is no judgement or order of any court, tribunal or official body
         against any Group Company or any officer which has not been fully
         satisfied or discharged.

10       APPLICABLE LEGISLATION

10.1     No notice has been received that any Group Company is in breach of any
         legislation or regulations nor, so far as the Existing Shareholder is
         aware, is any Group Company in material breach of any such legislation
         or regulations.

                                       21
<PAGE>

11       RECORDS AND DOCUMENTS

11.1     The copies of the Memorandum and Articles of Association (having
         attached thereto copies of all resolutions and agreements referred to
         in Section 380 of the Companies Act 1985) of each Group Company
         delivered to the Investor prior to the date hereof are true and
         complete copies.

11.2     The register of members of each Group Company is correct, there has
         been no notice of any proceedings to rectify the register and there are
         no circumstances which might lead to any application for rectification
         of the register.

11.3     Each Group Company has kept duly made up all requisite books of
         account, statutory registers and records and these and all other
         documents (properly stamped where necessary) belonging to or which
         ought to be in the possession of each Group Company are in its
         possession.

11.4     All documents requiring to be filed with the Registrar of Companies by
         each Group Company have been properly made up and punctually filed.

12       INSURANCE

         Details of the current insurance cover of the Company are set out in
         the Disclosure Letter.

13       COMPANY AGREEMENTS

13.1     So far as the Existing Shareholder is aware, no Group Company has
         committed, or omitted to do, any act or thing which could give rise to
         any fine or penalty, nor is any Group Company a party to any agreement
         or practice or arrangement which in whole or in part is in breach of
         any legislation or regulation.

13.2     No Group Company is party to any contract, transaction, arrangement or
         liability:-

         13.2.1   which is outside the ordinary course of business of a company
                  which develops and operates conference centre facilities;

         13.2.2   in respect of which such Group Company is in material default
                  in respect of any obligation or restriction binding upon it;

         13.2.3   in respect of which such Group Company has received any notice
                  of any claim for misrepresentation or breach of contract; or

         13.2.4   which includes a "change of control" or "change of management"
                  clause which might result in termination of such contract,
                  transaction or arrangement following completion of the
                  transactions recorded in this Agreement.

13.3     No Group Company is party to any contract, transaction or arrangement
         for the provision of services by the Company which is of a loss-making
         nature (i.e. known to be likely to result in a loss of more than
         (pound)500 to such Group Company on completion or performance).

14       LOANS AND FINANCIAL FACILITIES

14.1     No Group Company has made or obtained any loans which now remain
         outstanding in whole or in part.

14.2     No Group Company has any loan capital or debenture or any mortgage,
         charge, lien (other than a lien arising in the ordinary course of
         business) or other encumbrance over any of its assets.

                                       22
<PAGE>

14.3     No Group Company has any liability (present, future, ascertained or
         contingent) under:-

         14.3.1   any guarantee, surety, bond or similar obligation; or

         14.3.2   any agreement for the hire, rent, hire purchase or purchase on
                  deferred terms of any asset.

15       LIABILITIES TO THE EXISTING SHAREHOLDER

15.1     No Group Company has any liability to:-

         15.1.1   the Existing Shareholder apart from remuneration accrued
                  during the month in which this Agreement has been entered
                  into;

         15.1.2   any Associates of the Existing Shareholder; or

         15.1.3   any company of which three per cent or more of the equity
                  share capital is owned or controlled directly or indirectly by
                  the Existing Shareholder and/or her Associates.

15.2     Neither the Existing Shareholder nor any of her Associates has any
         interest in any other firm, business or company which has or has had a
         material or close trading relationship with or is or may be in
         competition with any Group Company.

16       INSOLVENCY

16.1     No Group Company is insolvent as defined by Section 123 of the
         Insolvency Act 1986 or has entered into any scheme or arrangement or
         voluntary or other arrangement with any of its creditors.

16.2     No order has been made or resolution passed for the winding up of any
         Group Company and there is not outstanding any petition for winding up
         of a Group Company or any petition applying for an administration order
         to be made in relation to a Group Company or any receivership of the
         whole or any part of the undertaking or assets of a Group Company.

16.3     There are no circumstances which would entitle any person to present a
         petition for the winding up of a Group Company or to present a petition
         applying for an administration order to be made in relation to a Group
         Company or to appoint a receiver of the whole or any part of its
         undertaking or assets.

17       TAXATION

17.1     Save to the extent that specific provision has been made in the
         Accounts for any liability or contingent liability to Taxation and save
         for any liability to corporation tax arising in the ordinary course of
         the Company's normal trading since the Accounts Date, no Group Company
         has any liability or contingent liability in respect of any form of
         Taxation (the deprivation or nullifying of any relief or advantage
         (including the right to set past losses against future profits) or the
         requirement to make any payment or the loss of the right to any
         repayment by or to the Inland Revenue or any other authority being
         deemed to be a liability in respect of Taxation for the purposes of
         this paragraph).

17.2     Each Group Company has duly complied with its obligations to account to
         the Inland Revenue and all other relevant authorities for all amounts
         for which it is accountable in respect of Taxation or amounts payable
         under social security legislation.

                                       23
<PAGE>

17.3     All returns and computations in connection with Taxation that should
         have been made by each Group Company have been made correctly and on a
         proper basis; no such return or computation has been or is likely to be
         disputed and there are no facts known or which would on reasonable
         enquiry be known to the Company or the Existing Shareholder, which may
         give rise to any such dispute or to any claim for any Taxation or to
         the deprivation of any relief from Taxation or advantage that would be
         likely to have been available.

17.4     No Group Company has been a party to any scheme or arrangement partly
         or wholly for the purpose of artificially avoiding Taxation.

17.5     Each Group Company is duly registered for VAT purposes and has in all
         other respects complied with the Value Added Tax Act 1994 and all
         orders, regulations, directions or conditions made or imposed
         thereunder and has maintained correct and up-to-date records, invoices
         and other documents appropriate or necessary for the purposes of such
         legislation and is not in arrears with any payment or returns or liable
         to any abnormal or non-routine payment or any forfeiture or penalty or
         to the operation of any penal provision. Each Group Company is a
         taxable person for the purposes of such legislation and is not treated
         and has not at any time been treated as a member of a group for the
         purpose thereof nor has any application for it to be so treated at any
         time been made.

17.6     No rents, interest annual payments or other sums of an income nature
         paid or payable by any Group Company are, or are likely to be, wholly
         or partially disallowable in calculating the tax liability of such
         Group Company and no contacts which could result in future
         disallowances have been entered into.

17.7     The Company has notified the Inspector of Taxes of all expenditure
         qualifying for plant and machinery capital allowances which it has
         incurred in accordance with the requirements of FA1994 s118.

17.8     No Group Company has acquired or disposed of any asset other than at
         arm's length.

17.9     The Inland Revenue (or any other authority interested in Taxation) has
         not investigated any transaction entered into by any Group Company with
         a view to applying TA1988 S770 (transfer pricing) and no Group Company
         has been party to any transaction or arrangement to which the
         provisions of that section can be applied.

17.10    Any VAT or equivalent tax for which any Group Company is required to
         account in another country has been paid and all related regulatory
         requirements have been satisfied.

17.11    Each Group Company has in all respects complied with the requirements
         of Customs & Excise, the Department of Trade and Industry, and any
         other customs authority, and no Group Company has or has reason to
         expect to have, a dispute with any of such authorities.

17.12    No Group Company has ever been the subject of an investigation or
         discovery by or involving any of the investigation units of the Inland
         Revenue or Customs & Excise and there are no circumstances existing
         which make it likely that an investigation or discovery will be made.

                                       24
<PAGE>

18       INTELLECTUAL PROPERTY

18.1     All Intellectual Property used or acquired by the Company in connection
         with its business and/or which is necessary or required to carry on its
         business (as carried on at the date hereof), is in full force and
         effect and is vested in, and beneficially owned by or licensed to the
         Company and no third party has claimed that use of such Intellectual
         Property by the Company infringes its rights.

18.2     In relation to Intellectual Property which is owned by the Company, the
         Company is the sole beneficial owner of such Intellectual Property and
         (where registration is possible) the Company has been and is registered
         as sole proprietor and so far as the Existing Shareholder is aware the
         rights in respect of such Intellectual Property are valid, subsisting
         and enforceable and no third party has made any claim or asserted any
         right in respect thereof.

18.3     In respect of the Intellectual Property which is licensed to the
         Company, so far as the Existing Shareholder is aware each such
         agreement or licence granted is valid and subsisting and the Company
         has not done anything nor is the Company aware of anything which would
         cause any such licence to be terminated or to cease or which
         constitutes a breach of the terms of any such agreement or licence.

18.4     The Company has not made any claim or issued any proceedings against
         any third party in respect of any unauthorised use or infringement of
         its Intellectual Property, nor has the Company received notice of any
         claim or proceedings from any third party in respect of the any
         Intellectual Property used by the Company.

19       PROPERTIES

19.1     The Properties comprise all the land and buildings owned by the Company
         or used or occupied by it or in which it has any other interest, right
         or liability.

19.2     The Company is in physical possession and actual occupation of the
         Properties on an exclusive basis.

19.3     No notices, orders, proposals, applications, requests or schedules of
         dilapidations affecting or relating to any of the Properties have been
         served or made by any authority or other person or by the Company and
         there are no circumstances which are likely to result in any being
         served or made.

19.4     The Company has not received any notice claiming any outstanding and
         unobserved or unperformed obligation of the Company with respect to the
         Properties necessary to comply with the requirements (whether formal or
         informal) of any competent authority exercising statutory or delegated
         powers.

19.5     None of the Properties is subject to the payment of any outgoings other
         than general or water rates (and in the case of leaseholds, sums
         reserved by the relevant lease) and all outgoings have been duly paid
         to date, and none is in dispute.

19.6     No action, claim, proceeding, demand, dispute or liability (contingent
         or otherwise) in respect of any of the Properties is outstanding or
         anticipated.

19.7     No dispute with any adjoining or neighbouring owner with respect to
         boundary walls and fences or with respect to any easement right or
         means of access to any neighbouring property or its use or occupation
         is outstanding.

                                       25
<PAGE>

19.8     In relation to each of the Properties:-

         19.8.1   each Property is held under the terms of the lease ("THE
                  LEASE") which is correctly summarised in Part 4 of the
                  Schedule and no licences or collateral assurances,
                  undertakings or concessions have been granted;

         19.8.2   no notices have been served by the landlord in respect of any
                  Lease;

         19.8.3   so far as the Existing Shareholder is aware the Company has
                  observed and performed the covenants and the conditions
                  contained in the Lease in all material respects, and has
                  received no complaint regarding any alleged breach of any of
                  such covenants and conditions;

19.9     The Company has not at any time:-

         19.9.1   had vested in it (whether as an original tenant or undertenant
                  or as an assignee, transferee or otherwise) any freehold or
                  leasehold property other than the Properties; or

         19.9.2   given any covenant or entered into any agreement, deed or
                  other document (whether as a tenant or undertenant or as an
                  assignee, transferee, guarantor or otherwise) in respect of
                  any freehold or leasehold property other than those disclosed
                  in the Disclosure Letter in respect of which any contingent or
                  potential liability remains with the Company.

                                       26
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                                     PART 4

                                 THE PROPERTIES


1.       24 and 24A Cambridge Science Park, Milton Road, Cambridge more
         particularly described in a Lease dated the 3rd day of April 2000 and
         made between The Master Fellows and Scholars of Trinity College,
         Cambridge (1) and Q Ton Limited (2) and Amanda Staveley (3).

2.       24B Cambridge Science Park, Milton Road, Cambridge more particularly
         described in a lease annexed to an Agreement for Lease dated the 3rd
         day of September 1999 and made between The Master Fellows and Scholars
         of Trinity College Cambridge (1) Q Ton Limited (2) and Amanda Staveley
         (3).

                                       27
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                                     PART 5

                         MAIN TERMS OF SERVICE CONTRACT


POSITION:                Chief Executive Officer

SALARY:                  Nil

OTHER BENEFITS:          Company car appropriate to position

HOLIDAY:                 20 days

WORKING HOURS:           Such time as is required to properly perform her duties

                                       28
<PAGE>

EXECUTED as a DEED by                       )
AMANDA LOUISE STAVELEY                      )    ...............................
                                            )
in the presence of:                         )

Witness ...................................

Full name .................................

Address ...................................


EXECUTED as a DEED by                       )
EUROTELECOM CORPORATION                     )
LIMITED acting by its two duly              )
authorised officers:                        )

 ...........................................
Director

 ...........................................
Director/Secretary


EXECUTED as a DEED by                       )
Q.TON LIMITED                               )
acting by its two duly                      )
authorised officers:                        )

 ...........................................
Director

 ...........................................
Director/Secretary

                                       29