EXHIBIT 2.02


                                MERGER AGREEMENT


        THIS MERGER AGREEMENT (the "Agreement") is entered into this 29th day of
June,  1999, by and among EUROPEAN MICRO  HOLDINGS,  INC., a Nevada  corporation
(the "PARENT"),  AMERICAN MICRO ACQUISITION CORP., a wholly-owned  subsidiary of
the Parent and a Florida  corporation  (the  "MERGER  SUB"),  AMERICAN  SURGICAL
SUPPLY  CORP.  OF  FLORIDA  D/B/A  AMERICAN  MICRO  COMPUTER  CENTER,  a Florida
corporation  (the  "COMPANY"),  and the persons named as  "Shareholders"  on the
signature   pages   hereto   (each  a   "SHAREHOLDER"   and   collectively   the
"SHAREHOLDERS").


                                    RECITALS:

        A.  The Shareholders  own all of the  outstanding  capital  stock of the
Company. The authorized capital stock of the Company consists of 7,500 shares of
common stock, par value $1.00 per share, 300 of which are issued and outstanding
(the "COMPANY COMMON STOCK").

        B.  Upon the  terms  and  subject  to the  conditions  set forth in this
Agreement,  the Company shall merge with and into the Merger Sub (the  "Merger")
with Merger Sub surviving,  in accordance with the Florida Business  Corporation
Act (the "FLORIDA BCA").

        C.  Capitalized terms used in this Agreement, which are not defined when
first used, shall have the meanings assigned to them in Section 1.3 hereof.  For
the purposes  hereof,  references to the Company  shall mean  American  Surgical
Supply Corp. of Florida d/b/a American Micro Computer Center up to and including
the Closing Date and  thereafter  shall mean the Merger Sub, which shall include
the operations of the Company.


                                   AGREEMENT:

        NOW, THEREFORE, in consideration of the mutual premises herein set forth
and certain other good and valuable  consideration,  the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:

        1.  THE MERGER AND RELATED TRANSACTIONS.

            1.1.    MERGER. In accordance with the provisions of this Agreement,
the  Florida  BCA and other  applicable  law,  on the  Closing  Date (as defined
below), the Company shall be merged with and into the Merger Sub, which shall be
the surviving corporation  (hereinafter  sometimes referred to as the "Surviving
Corporation")  and shall continue its corporate  existence under the laws of the
State of Florida as a wholly-owned  subsidiary of the Parent. As of the Closing,
the name of the Merger Sub shall be American Micro Computer Center, Inc. and the
separate existence of the Company shall cease. On the Closing Date and by virtue
of the Merger and without any action on the part of the Shareholders, all of the

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then issued and  outstanding  shares of capital  stock of the  Company  shall be
automatically  canceled and shall entitle the Shareholders to receive the Merger
Consideration set forth in Section 1.2 hereof.

            1.2.    MERGER CONSIDERATION AND PAYMENT.

                    1.2.1. MERGER  CONSIDERATION.  The merger consideration (the
"Merger  Consideration")  (of which twenty five thousand dollars ($25,000) shall
be paid to each  Shareholder as  consideration  for the covenant  against unfair
competition set forth in Section 2.6 hereof) shall be equal to the sum of:

                         (a) Book Value Amount; plus

                         (b) 1998 Normalized Earnings Payment Amount; plus

                         (c) Earn-Out Amount.

                    1.2.2. MANNER OF PAYMENT.  The Merger Consideration shall be
payable as follows: (a) at Closing, an amount equal to the sum of (i) Book Value
Amount,  plus (ii) 1998 Normalized  Earnings Payment Amount  (collectively,  the
"First Installment");  (b) within thirty (30) days of the completion of an audit
of the Company's  financial  statements  for the year ended December 31, 1999 by
the Parent's independent certified public accountants and in no event later than
May 1, 2000,  the First  Earn-Out  Amount (the  "Second  Installment");  and (c)
within thirty (30) days of the completion of an audit of the Company's financial
statements for the year ended December 31, 2000 by the Parent's  Accountants and
in no event  later than May 1,  2001,  an amount  equal to the  Second  Earn-Out
Amount  (the  "Third  Installment").  The  First  Installment  shall  be paid in
immediately available funds. The Second Installment and Third Installment shall,
at the  option  of the  Parent,  be paid in cash  or in  shares  (the  "Parent's
Shares")  of common  stock,  par value  $0.01 per share  (the  "Parent's  Common
Stock"), or any combination of cash or shares; provided that the Parent need not
pay each  Shareholder  in the same form of  consideration.  Notwithstanding  the
foregoing,  any  Parent's  Shares  issued  hereunder  shall be  salable  by each
Shareholder  over the sixty  (60)  trading  day  period  either  pursuant  to an
effective  registration statement or pursuant to an exemption from registration.
The number of  Parent's  Shares to be issued in  payment  of any  portion of the
Merger  Consideration  shall  be  equal  to:  (a)  the  portion  of  the  Merger
Consideration payable in Parent's Shares, divided by (b) the Per Share Value (as
defined herein); provided that in the event the Parent elects to pay any portion
of the Merger  Consideration  in Parent's Shares,  then the  Shareholders  shall
notify the Parent  within five (5) business  days of his election to either hold
such  Parent  Shares  or to  sell  such  shares  immediately.  In  the  event  a
Shareholder  elects to immediately  sell his Parent'  Shares,  he shall sell the
Parent's Shares in accordance with the Parent's instructions; provided, further,
that if the Shareholders cannot sell any such shares within a sixty (60) trading
day period commencing fifteen (15) days after the Shareholders'  receipt of such
shares,  then the Shareholders shall return any remaining Parent's Shares to the
Parent and the Parent  shall  promptly  pay to the  Shareholders  any  remaining
portion  of the  Merger  Consideration  less the net  proceeds  received  by the
Shareholders for any Parent's Shares sold by the Shareholders. In the event that
the sale of the Parent's Shares by the Shareholders results in net proceeds of

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less than the amount of either the Second  Installment or the Third  Installment
(as applicable), then the Parent shall pay to the Shareholders the difference in
cash  within  twenty-eight  (28)  days  of  being  notified  the  amount  of any
shortfall.

            1.3.    CERTAIN DEFINITIONS.

                    1.3.1.  "BOOK  VALUE  AMOUNT"  means an  amount equal to the
Company's  combined  shareholder's  equity (stated capital,  paid-in surplus and
retained  earnings) as of the Closing Date (as defined  herein).  The Book Value
Amount shall be determined as provided  herein and in accordance  with generally
accepted  accounting  principles ("GAAP")  consistently  applied (except for the
reserves  for  inventory   obsolescence  and  allowance  for  doubtful  accounts
receivable),  and shall be based on the financial  statements of the Company for
the  applicable  period,  as  audited  (or  reviewed)  by  Parent's  independent
certified public  accountants and accepted by Parent. For purposes of paying the
First Installment, the Book Value Amount shall be estimated by the parties based
on the most recently completed monthly financial statements of the Company prior
to Closing,  which is expected to be May 31, 1999 (the  "ESTIMATED BOOK VALUE").
The Book Value Amount shall be adjusted as set forth in Subsection 1.4.2 hereof.

                    1.3.2.  "1998 NORMALIZED  EARNINGS PAYMENT AMOUNT" means two
(2) times the  After-Tax  Earnings  of the  Company  in the  twelve  (12)  month
calendar   period  ended   December  31,  1998,   as  adjusted  by  adding  back
non-recurring items and subtracting an assumed tax rate of 34%, all as set forth
on EXHIBIT "A" hereto.

                    1.3.3.  The  "EARN-OUT  AMOUNT" means the sum of (i) two (2)
times the After-Tax Earnings of the Company (the "FIRST EARN-OUT AMOUNT") in the
twelve (12) month calendar  period ended December 31, 1999 (the "FIRST  EARN-OUT
PERIOD")  and (ii) two (2) times the  After-Tax  Earnings  of the  Company  (the
"SECOND  EARN-OUT  AMOUNT")  in the twelve  (12)  month  calendar  period  ended
December 31, 2000 (the "SECOND EARN-OUT PERIOD").

                    1.3.4. "AFTER-TAX EARNINGS" means net income after taxes for
the Company  computed as provided  herein and otherwise in accordance with GAAP,
and shall be based on the financial statements of the Company for the applicable
period, as audited (or reviewed and accepted) by Parent's independent  certified
public  accountants.  In  determining  After-Tax  Earnings,  the  Company's  net
earnings shall be adjusted a set forth in Subsection 1.4.3.  hereof.  The Parent
shall cause its  accountants to complete their audit of the Company's  financial
statements as soon as practicable and in no event later than  one-hundred-twenty
(120) days after the end of the First  Earn-Out  Period and the Second  Earn-Out
Period, respectively.

                    1.3.5. "PER SHARE VALUE" means the average closing price for
the Parent's  Common  Stock on the Nasdaq  Stock  Market  during the thirty (30)
trading  days ending on the last  trading day before the date of issuance of the
Parent's Common Stock in question.

              1.4.    CERTAIN ADJUSTMENTS.

                    1.4.1. FORCE MAJEURE. The Earn-Out Period shall be suspended
for so long as the  Company is unable to conduct  its  business  by reason of an
event of Force Majeure (confirmed to Parent's reasonable  satisfaction).  "FORCE

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MAJEURE" shall mean acts of God, strikes,  explosions,  fires,  flood,  embargo,
storm,  or acts of war or  terrorism  that  directly  prevent the  Company  from
conducting its business.  Upon the occurrence of an event of Force Majeure,  the
Shareholders  shall  immediately  provide the Parent with written notice thereof
(the "FORCE MAJEURE  NOTICE").  The Earn-Out  Period shall be suspended from the
date on which the  Force  Majeure  Notice  is  received  by  Parent  until  such
condition no longer  prevents  the Company from  conducting  its  business.  The
Earn-Out  Period shall be extended by the number of days such Earn-Out Period is
suspended  hereunder.  Notwithstanding  the  foregoing,  in no event  shall  any
Earn-Out Period be extended  pursuant to this Subsection  1.4.1 for more than an
aggregate of ninety (90) days. The Shareholders shall use all reasonable efforts
to prevent and reduce to a minimum and mitigate the effect of any event of Force
Majeure,  and to ensure  resumption  of  normal  business  operations  after the
termination of any event of Force Majeure.

                    1.4.2.  ADJUSTMENTS TO BOOK VALUE AMOUNT.  Book Value Amount
shall be reduced by an amount equal to the difference between (a) the sum of any
accounts  receivable  (or  any  portion  thereof)  identified  on the  financial
statements  of the Company as of the Closing  which are not  collected  in full,
without any set-off, within one hundred fifty (150) days after Closing, plus any
inventory  identified  on the  financial  statements  of the  Company  as of the
Closing  not sold by the  Company  within  two  hundred  forty  (240) days after
Closing and (b) any applicable  provision for doubtful  accounts  receivable and
inventory  obsolescence  agreed to in  accordance  with Section  1.3.1 as of the
Closing.  After  Closing  and  completion  of  the  audit  (or  the  review  and
acceptance) by the Parent's  independent  certified  public  accountants  (which
shall be completed within sixty (60) days of the Closing), the Book Value Amount
shall be adjusted up or down as finally  determined in  accordance  with Section
1.3.1,  and each party shall pay in cash to the other  within  fifteen (15) days
after the Book  Value  Amount  is  finally  determined  such  amounts  as may be
necessary  to  give  effect  to  the  correct  Book  Value  Amount,  as  finally
determined.  Except  for any  payments  required  by the  immediately  preceding
sentence,  payments due hereunder  with respect to any  adjustments  to the Book
Value  Amount  under this  Subsection  1.4.2  shall be paid by  delivery  on the
applicable  determination  date (i.e.  within one hundred fifty (150) days after
Closing in the case of accounts  receivable  and within two hundred  forty (240)
days after  Closing in the case of inventory)  of one or more  promissory  notes
which shall bear  interest at the rate of eight percent (8%) per annum and shall
mature on the Second  Installment  payment date. Amounts due under the notes may
be set-off against any installments  due to Shareholders  under Subsection 1.2.2
hereof. Any account receivable or inventory which results in a reduction in Book
Value Amount under this Subsection  1.4.2 shall be assigned to the  Shareholders
upon execution by Shareholders of the promissory note referred to above.

                    1.4.3. ADJUSTMENTS TO AFTER-TAX EARNINGS. After-Tax Earnings
shall be reduced by (a) any compensation  paid to John P. Gallagher  pursuant to
Section 2.13 hereof;  (b) any compensation paid to John B. Gallagher pursuant to
Section  2.13  hereof;  (c) any  professional  fees and other  expense  directly
related to the Company, including accounting and legal fees (excluding any costs
incurred by Parent in connection with this Agreement),  and (d) any expenses and
costs (including  interest) related to inter-company or other  indebtedness used
to finance  the  Company's  operations  or to  replace  the  Company's  existing
indebtedness.  The After-Tax  Earnings for 1999 shall be adjusted by adding back
non-recurring  items and  subtracting  an assumed tax rate of 34% for the period
between  January 1, 1999 and the Closing  Date,  all as set forth on Exhibit "B"
hereto. No part of the Merger  Consideration or any interest thereon  (including

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any  amortization  of goodwill or any other  intangible  asset) shall be charged
against the Company for the purpose of calculating After-Tax Earnings under this
Agreement.

            1.5.  CLOSING.  The parties to this Agreement shall file Articles of
Merger (as  defined  below)  pursuant to the  Florida  BCA,  cause the Merger to
become  effective and consummate  the other  transactions  contemplated  by this
Agreement  (the  "CLOSING") no later than July 15, 1999;  provided,  in no event
shall the Closing occur prior to the  satisfaction  of the conditions  precedent
set forth in  Sections  6, 7 and 8 hereof.  The date of Closing is  referred  to
herein as the  "CLOSING  DATE." The  Closing  shall take place at the offices of
counsel to Parent,  or at such other  place as may be  mutually  agreed  upon by
Parent and  Shareholders.  At the Closing,  (i)  Shareholders  shall  deliver to
Parent the original stock  certificates  representing  the Company Common Stock,
together  with stock  powers duly  executed in blank;  and (ii) Parent shall pay
Shareholders the First Installment.

            1.6.  RESOLUTION  OF  ACCOUNTING  DISPUTES.   Upon  receipt  of  any
computation  of the Book  Value  Amount,  After-Tax  Earnings,  1998  Normalized
Earnings Payment Amount,  First Earn-Out Amount,  Second Earn-Out Amount and the
tax payments  required  pursuant to Section 2.19  hereunder  (collectively,  the
"ACCOUNTING  DETERMINATIONS"),  Shareholders  shall have a period of thirty (30)
days after their receipt of such computation to review the same. If Shareholders
disagree with any such computation,  they shall object to same by written notice
to Parent (an "OBJECTION  NOTICE"),  which notice shall:  (i) describe in detail
the basis for the objection;  and (ii) be delivered to Parent within such thirty
(30) day period.  For a period of thirty (30) days following Parent's receipt of
the Objection Notice, the parties shall cause the Shareholders' certified public
accountants (the  "SHAREHOLDERS'  ACCOUNTANTS") and the Parent's  Accountants to
attempt to agree on the  item(s) in  question.  If after  such  thirty  (30) day
period no agreement is reached,  the dispute shall be resolved by an independent
accounting firm jointly  selected by Parent and Shareholders  (the  "INDEPENDENT
ACCOUNTANTS"),  whose  determination  shall, absent manifest error, be final and
binding upon the parties.  In connection with the Accounting  Determinations and
related  reviews  and  audits,  (i)  Parent  shall  pay  the  fees  of  Parent's
Accountants;  (ii) Shareholders shall pay the fees of Shareholders' Accountants;
and (iii) the fees of the Independent Accountants shall be allocated and paid by
Parent or the Shareholders,  or divided among them, on a basis determined by the
Independent  Accountants to be fair,  taking into account the correctness of the
positions asserted by each of them with respect to the disputed matters resolved
by such firm.

            1.7.  PLAN OF  MERGER;  ARTICLES  OF  MERGER.  The  parties  to this
Agreement  shall  cause the  Company  and the Merger Sub to enter into a plan of
merger on the date  hereof,  a copy of which is  attached  hereto as Exhibit "C"
(the "Plan of  Merger"),  and, at Closing,  to execute the Articles of Merger in
the form attached hereof as Exhibit "D" (the "Articles of Merger"). The Articles
of Merger  shall be filed with the  Secretary of State of Florida on the Closing
Date in accordance with the Florida BCA.

            1.8. APPROVAL OF MERGER. By their execution of this Agreement,  each
Shareholder  of the Company  hereby  ratifies,  approves  and adopts the Plan of
Merger for all  purposes  under the Florida  BCA. On or before the  execution of
this  Agreement,  the Boards of Directors of the Parent,  the Merger Sub and the

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Company  shall  have  approved  this  Agreement,  the  Plan  of  Merger  and the
transactions contemplated hereby and thereby, and the Parent shall have approved
the same as the sole shareholder of the Merger Sub.

        2.  ADDITIONAL AGREEMENTS.

            2.1. ACCESS AND INSPECTION,  ETC. The Shareholders  have allowed and
shall allow Parent and its authorized  representatives full access during normal
business  hours from and after the date hereof and prior to the Closing  Date to
all of the properties, books, contracts,  commitments and records of the Company
for the  purpose of making  such  investigations  as the  Parent may  reasonably
request in connection with the transactions  contemplated  hereby (including the
taking of a physical  inventory),  and shall cause the Company to furnish Parent
such information  concerning its affairs as Parent may reasonably  request.  The
Shareholders  have caused and shall cause the personnel of the Company to assist
Parent in making such  investigation  and shall use their best  efforts to cause
the counsel,  accountants,  engineers and other non-employee  representatives of
the  Company  to be  reasonably  available  to  Parent  for such  purposes.  The
Shareholders  shall  cause the  Company to comply  with all  obligations  of the
Company under this Agreement.

            2.2. CONFIDENTIAL TREATMENT OF INFORMATION.  From and after the date
hereof,  the parties hereto shall and shall cause their  representatives to hold
in confidence  this  Agreement  (including  the Schedules  hereto),  all matters
relating hereto and all data and information  obtained with respect to the other
parties or their business, except such data or information as is published or is
a matter of public record,  or as compelled by legal process.  In the event this
Agreement is terminated pursuant to Section 10 hereof, each party shall promptly
return to the other(s) any statements,  documents,  schedules, exhibits or other
written  information  obtained from them in connection with this Agreement,  and
shall not retain any copies thereof.

            2.3.  PUBLIC  ANNOUNCEMENTS.  After  the date  hereof  and  prior to
Closing,  none of the parties hereto shall make any press release,  statement to
employees or other disclosure of this Agreement or the transactions contemplated
hereby without the prior written consent of the other parties,  except as may be
required by law.  Neither the Company nor the  Shareholders  shall make any such
disclosure   unless  the  Parent  shall  have  received   prior  notice  of  the
contemplated  disclosure and has had adequate time and opportunity to comment on
such  disclosure,  which shall be satisfactory in form and content to the Parent
and its counsel.

            2.4.    SECURITIES LAW COMPLIANCE.

                    2.4.1.  The  Company  covenants  and agrees that the  Parent
Shares to be issued to the  Shareholders  hereunder  shall be issued  either (i)
pursuant to an effective  registration  statement  under the  Securities  Act of
1933, as amended, or (ii) pursuant to an exemption  therefrom.  In either event,
if the Company elects to issue the Parent's  Shares to a  Shareholder,  then the
Company  shall take all  actions  necessary  in order that such  Shareholder  is
capable of selling the Parent Shares so issued within the sixty (60) trading day
period set forth in Section 1.2.2 hereof.

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                    2.4.2.  Each Shareholder has received and reviewed copies of
the following  disclosure documents filed by Parent with the U.S. Securities and
Exchange Commission (collectively,  the "SEC DOCUMENTS"):  (i) Quarterly Reports
on Form 10-Q for the three month periods ended March 31, 1999, December 31, 1998
and  September  30, 1998 and (ii) Annual  Report on Form 10-K for the year ended
June 30, 1998.

            2.5. COMPANY  FINANCING.  Parent shall use  commercially  reasonable
efforts to cause the  Shareholders  to be released from any personal  guarantees
executed with respect to obligations of the Company.

            2.6. COVENANT AGAINST UNFAIR COMPETITION.

                         (a) Except for services to be provided to Parent or the
Company pursuant to written  contracts and in  consideration  for the payment of
$25,000 to each  Shareholder  (which  amount  comprises  a portion of the Merger
Consideration), no Shareholder will, for a period of two (2) years following the
Closing  Date,  for his  own  account  or  jointly  with  another,  directly  or
indirectly,  for or on behalf of any  individual,  partnership,  corporation  or
other legal entity, as principal, agent or otherwise:

                            (i) own, control, manage, be employed by, consult
with, or otherwise participate in, a business involved within the Trade Area (as
hereinafter  defined) in (1) the wholesale  distribution of computers,  computer
products, peripherals and related parts, components and equipment (collectively,
the  "Products") or (2) any other  business  conducted by the Company during the
year preceding the Closing Date (the activities described in this clause (i) are
hereinafter referred to collectively as the "Business");

                            (ii) solicit or induce,  or in any manner attempt to
solicit  or  induce,  any  person  employed  by the  Company,  the Parent or any
subsidiary  of the  Parent  to  leave  such  employment,  whether  or  not  such
employment is pursuant to a written  contract and whether or not such employment
is at will, or hire any person who has been employed by the Company,  the Parent
or any  subsidiary  of the Parent at any time  during  the six (6) month  period
preceding such hiring by the Company, the Parent or any subsidiary of the Parent
(as applicable); or

                            (iii)  use  or   disclose   any  trade   secrets  or
confidential  information  concerning the Business or any segment thereof. Trade
secrets and confidential  information concerning the Business shall include, but
not be limited to, (1) lists of names and  addresses of customers  and suppliers
of the Company; and (2) software and computer programs, market research and data
bases,  sources of leads and methods of obtaining new  business,  and methods of
purchasing,  marketing,  selling,  performing and pricing  products and services
employed by the Company in the Business or any segment thereof.

                         (b) As used  herein,  the term "Trade  Area" shall mean
the United States and any other  geographic area in which the Company  conducted
any  significant  business  activities  within  the  twelve  (12)  month  period
immediately prior to Closing.

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                         (c)  Shareholders   recognize  the  importance  of  the
covenant contained in this Section 2.6 and acknowledge that, based on their past
experience  and training as the founders and  executives  of the Company and the
projected expansion of the Company's business,  the restrictions  imposed herein
are:  (i)  reasonable  as to  scope,  time  and  area;  (ii)  necessary  for the
protection of the Company's  legitimate business interests,  including,  without
limitation,  the Company's trade secrets,  goodwill,  and its relationship  with
customers and suppliers;  and (iii) not unduly  restrictive of any Shareholder's
rights as an individual.  Shareholders  acknowledge and agree that the covenants
contained in this Section 2.6 are essential  elements of this Agreement and that
but for these  covenants,  Parent  would not have agreed to purchase the Company
Common Stock or enter into this Agreement.  Such covenants shall be construed as
agreements  independent of any other provision of this Agreement.  The existence
of any claim or cause of action  against  Parent  by the  Shareholders,  whether
predicated on the breach of this Agreement or otherwise,  shall not constitute a
defense to the  enforcement  by the Parent of the  covenants  contained  in this
Section 2.6.

                         (d) If any Shareholder commits a breach or threatens to
commit a breach of any of the provisions of this Section 2.6,  Parent shall have
the right and remedy, in addition to any others that may be available, at law or
in equity,  to have the provisions of this Section 2.6 specifically  enforced by
any  court  having  equity  jurisdiction,  through  injunctive  or other  relief
(without  any  bond  or  security  being  required  to  be  posted),   it  being
acknowledged  that any such breach or threatened  breach will cause  irreparable
injury to Parent  and the  Company,  the amount of which  will be  difficult  to
determine,  and that money damages will not provide an adequate remedy to Parent
and the Company.

                         (e) If any  covenant  contained in this Section 2.6, or
any part thereof,  is hereafter  construed to be invalid or  unenforceable,  the
same shall not affect the remainder of the covenants,  which shall be given full
effect,   without  regard  to  the  invalid  portions,   and  any  court  having
jurisdiction  shall have the power to reduce the duration,  scope and/or area of
such covenant and, in its reduced form, said covenant shall then be enforceable.
If a  Shareholder  breaches  the  covenants  set forth in this  Section 2.6, the
running of the two (2) year  noncompete  period  described  herein  (but not his
obligation) shall be tolled for so long as such breach continues.

            2.7. BEST EFFORTS.  Subject to the terms and conditions  provided in
this Agreement,  each of the parties shall use its best efforts in good faith to
take or cause to be taken as promptly as practicable all reasonable actions that
are within its power to cause to be fulfilled those conditions  precedent to its
obligations  or  the   obligations  of  the  other  parties  to  consummate  the
transactions contemplated by this Agreement that are dependent upon its actions.

            2.8. FURTHER ASSURANCES. The parties shall deliver any and all other
instruments or documents  required to be delivered  pursuant to, or necessary or
proper in order to give effect to, the provisions of this Agreement,  including,
without  limitation,  all necessary  stock powers and such other  instruments of
transfer as may be necessary  or desirable to transfer  ownership of the Company
Common Stock and to consummate the transactions contemplated by this Agreement.

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            2.9. COMPANY OPERATIONS.  From the Closing Date and until the end of
the Second Earn-Out Period,  (a) neither Parent nor any of its affiliates shall:
(i) charge  management,  overhead or other fees to the  Company,  except for the
standard  management  fee charged to other  Parent  subsidiaries  which shall be
charged to the Company only; or (ii) allocate or assign additional  employees or
employee  compensation  to the  Company  which are not  reasonably  required  to
properly  manage or conduct its business;  and (b) the Company will operate as a
wholly-owned  subsidiary of Parent. Subject to Section 2.11 and until the end of
the Second Earn-Out Period,  Shareholders shall manage the day-to-day operations
of the Company,  subject to the provisions of Section 2.11 hereof and subject to
the terms of their  respective  employment  agreements and  consistent  with the
manner in which the business of the Company has theretofore been conducted,  and
Shareholders  shall  cause the  Company to expend all sums and take all  actions
that are usual and  customary  for the  Company to  preserve  its  business  and
further its prospects as an ongoing  enterprise.  If during the Earn-Out  Period
the  Shareholders  shall be unable to manage the  day-to-day  operations  of the
Company for any reason, including,  without limitation, the termination of their
respective employment  agreements,  the Parent shall (a) cause the Company to be
managed in the manner  contemplated  by this  Section  2.9, and (b) use its best
efforts to maximize the After-Tax Earnings of the Company.

            2.10. SHAREHOLDER LOANS.

                         (a)  Within  thirty  (30) days of the  Closing,  Parent
shall pay and satisfy the outstanding  principal balance and accrued interest on
the  shareholder  loan payable by the Company to John P.  Gallagher in an amount
not to exceed $300,000,  which shall be reduced by the book value of the Lincoln
Town Car to be transferred to John P. Gallagher on or before the Closing.

                         (b) At Closing,  the loan owed by John B.  Gallagher to
the Company shall be offset against the amounts owed to John B. Gallagher  under
the First Installment.

            2.11.  INVENTORY  ALLOCATION.  On or  before  the  Closing  Date and
through the end of the Second Earn-Out Period, the Parent and Shareholders shall
establish a committee consisting of John B. Gallagher,  Harry D.Shieldss,  Frank
Cruz and Jay Nash to oversee the  allocation  of inventory  among the Parent and
its  subsidiaries  and the Company during the period from the Closing Date until
the end of the Second Earn-Out Period. In addition,  the Parent and Shareholders
shall  agree  upon a  committee  charter  which  shall  more fully set forth the
committee's  duties in  reviewing  issues of inventory  allocation,  including a
procedure  pursuant to which Harry  Shields  shall cast the deciding vote in the
event of the deadlock of the committee members.

            2.12.  FAIRNESS  OPINION.  The Parent shall have received an opinion
from Morgan Keegan & Company,  Inc. or another  investment banking firm or other
financial advisor satisfactory to the Parent in its sole discretion stating that
the  transaction  taken as a whole is fair from a financial point of view to the
Parent and its public shareholders.


<PAGE>

            2.13. EMPLOYMENT MATTERS.

                         (a) At  Closing,  John P.  Gallagher  will  execute and
deliver an employment  agreement  with the Merger Sub in the form of EXHIBIT "E"
hereto,  which agreement will include a non-compete  provision extending through
the  term  of  employment  and  for a  period  of two (2)  years  following  the
termination of the employment agreement.

                         (b) At  Closing,  John B.  Gallagher  will  execute and
deliver an employment  agreement with the Merger Sub in the form of EXHIBIT "F",
which  agreement  shall  provide for a base salary of One Hundred Four  Thousand
($104,000) Dollars, a company car and a non-compete  provision extending for the
term of employment  and for a period of two (2) years  following  termination of
the Employment Agreement.

                         (c) Rich Niles shall have  entered  into an  employment
agreement, in form and substance satisfactory to the Parent.

            2.14.   MODIFICATION   OF  NOTES   PAYABLE.   The  Company  and  the
Shareholders shall use their best commercial efforts to modify the notes payable
identified on the 1998 Company  Balance Sheet (as defined in Section 3.6 hereof)
and any other notes payable  arising after December 31, 1998 in accordance  with
the terms of this Agreement to extend the maturity date for a period of at least
one year from the Closing  Date, at the same interest rate and with the right of
prepayment  without  penalty.  The Company shall provide the Parent with written
notice of the  modifications  to the notes  payable (if any)  referenced in this
Section at least five (5) days prior to the Closing. The Parent shall have until
Closing to accept such modifications and to proceed to Closing or to reject such
modifications and to terminate this Agreement.

            2.15.  MODIFICATION OF REAL PROPERTY LEASE. The Shareholders  hereby
grant to the Company,  which grant shall be  effective  as of the  Closing,  the
irrevocable  option to renew that certain Real Estate Lease (the "LEASE")  dated
as of  September  1997  between  the  Shareholders  and the  Company for two (2)
additional  successive  terms of three (3) years each,  the first renewal period
commencing  on September 1, 2002 and the second  renewal  period  commencing  on
September 1, 2005 (each,  a "RENEWAL  TERM").  The terms and  conditions  of the
Lease  during any Renewal  Term shall  remain  unchanged  except that the rental
during any Renewal  Term shall  increase by a fraction,  the  numerator of which
shall be the CPI-U,  as that term is defined  below,  for the month  immediately
preceding the applicable Renewal Term, and the denominator of which shall be the
CPI-U for the month  immediately  preceding the Closing in the case of the first
Renewal Term and the month  immediately  preceding the first Renewal Term in the
case of the second  Renewal Term.  The "CPI-U"  shall mean the  "Consumer  Price
Index-Seasonally  Adjusted  U.S.  City  Average  For All  Items  For  All  Urban
Consumers,  (1982-84=100),"  published  monthly in the "Monthly Labor Review" of
the Bureau of Labor  Statistics  of the United States  Department  of Labor.  In
order to exercise this option,  the Company shall give the Shareholders at least
ninety (90) days' written  notice prior to the  termination  of the then current
term of the Lease.

            2.16. CERTAIN TAX MATTERS.

                         (a) ALLOCATION OF MERGER CONSIDERATION.  The Parent and
the Shareholders agree that the Merger Consideration and the liabilities of the

<PAGE>

Company  (plus  other  relevant  items) will be  allocated  to the assets of the
Company for all purposes  (including  tax and financial  accounting) in a manner
consistent  with the fair market values set forth on Schedule  2.16 hereto.  The
Parent,  the Company and the Shareholders  will file all tax returns  (including
amended  returns  and claims for  refund)  and  information  reports in a manner
consistent with such values.

                         (b) S  CORPORATION  STATUS.  Prior to the Closing Date,
the Company and the  Shareholders  will not revoke the Company's  election to be
taxed as an S  corporation  within the meaning of Sections  1361 and 1362 of the
Code. In addition,  prior to the Closing Date, the Company and the  Shareholders
will not take or allow  any  action  other  than  the  Merger  pursuant  to this
Agreement  that would result in the  termination  of the  Company's  status as a
validly electing S corporation within the meaning of Code Sections 1361 and 1362
of the Code.

                         (c) TAX PERIODS  ENDING ON OR BEFORE THE CLOSING  DATE.
The Parent shall  prepare or cause to be prepared and filed or cause to be filed
all tax  returns  for the  Company  for all  periods  ending  on or prior to the
Closing Date which are filed after the Closing Date. The Parent shall permit the
Shareholders  to review and  comment on each such tax  return  described  in the
preceding  sentence  prior to filing and shall make such  revisions  to such tax
returns as are reasonably requested by the Shareholders. To the extent permitted
by  applicable  law, the  Shareholders  shall  include any income,  gain,  loss,
deduction  or other tax items for such  periods on their tax returns in a manner
consistent  with the Schedule K-1s furnished by the Company to the  Shareholders
for such periods.  The Shareholders  shall reimburse the Parent for any taxes of
the Company with respect to such period  within  fifteen (15) days after payment
by the Parent or the Company.

                         (d) COOPERATION ON TAX MATTERS.

                            (i) The Parent,  the  Company  and the  Shareholders
shall cooperate  fully, as and to the extent  reasonably  requested by the other
party, in connection with the filing of tax returns pursuant to this Section and
any  audit,   litigation  or  other  proceeding  with  respect  to  taxes.  Such
cooperation shall include the retention and (upon the other party's request) the
provision of records and information  which are reasonably  relevant to any such
audit,  litigation  or other  proceeding  and making  employees  available  on a
mutually  convenient basis to provide additional  information and explanation of
any material provided  hereunder.  The Company and the Shareholders agree (A) to
retain all books and  records  with  respect  to tax  matters  pertinent  to the
Company  relating to any taxable period  beginning before the Closing Date until
the expiration of the statute of limitations (and, to the extent notified by the
Parent or the Shareholders,  any extensions  thereof) of the respective  taxable
periods,  and to abide by all record retention  agreements entered into with any
taxing  authority,  and (B) to give the other party  reasonable  written  notice
prior to transferring,  destroying or discarding any such books and records and,
if the other party so requests, the Company or the Shareholders, as the case may
be, shall allow the other party to take possession of such books and records.

                            (ii) The Parent and Shareholder  further agree, upon
request, to use their best efforts to obtain any certificate or other document

<PAGE>


from any  governmental  authority  or any other  person as may be  necessary  to
mitigate, reduce or eliminate any tax that could be imposed (including,  but not
limited to, with respect to the transactions contemplated hereby).

            2.17. RELEASE OF CLAIMS BY SHAREHOLDERS. Effective as of the Closing
Date,  and  except for (i) the  indebtedness  owed to John P.  Gallagher  by the
Company  in an amount  not to exceed  $300,000  reduced by the book value of the
Lincoln Town Car to be transferred to John P. Gallagher on or before the Closing
and (ii) any  obligations  arising  out of this  Agreement  (including,  without
limitation,  any  liability  incurred by the  Shareholders  with  respect to the
guarantees  referred to in Section 2.5 hereof),  each  Shareholder,  and each of
their   successors,    predecessors,    assigns,    agents,    advisors,   legal
representatives,  partners and all persons  acting by,  through or under each of
them,  hereby  release  the Company  and each of its  successors,  predecessors,
assigns,   agents,   advisors,    officers,    directors,    employees,    legal
representatives,  partners and all persons  acting by,  through or under each of
them, from any and all claims,  obligations,  causes of action,  actions, suits,
contracts,   controversies,   agreements,  promises,  damages,  demands,  costs,
attorneys' fees and  liabilities of any nature  whatsoever from the beginning of
time up to and including  the Closing  Date, in law or at equity,  whether known
now or on the Closing Date, anticipated or unanticipated,  suspected or claimed,
fixed or contingent,  liquidated or unliquidated,  arising out of, in connection
with or relating to any matter, cause or thing whatsoever.

            2.18.  NO-SHOP.  From the date hereof until the  termination of this
Agreement,   neither  the  Company  nor  the  Shareholders  shall,  directly  or
indirectly,  make,  solicit,  initiate or encourage  submission  of proposals or
offers from any persons  (including any of their employees or officers) relating
to an Acquisition  Proposal.  As used herein,  "Acquisition  Proposal" means any
proposal  or  offer  involving  a  liquidation,  dissolution,  recapitalization,
merger,  consolidation or acquisition or purchase of all or substantially all of
the assets of, or equity  interest in, the Company or other similar  transaction
or  business  combination  involving  the  Company.  Each of the Company and the
Shareholders  shall immediately cease and cause to be terminated all discussions
or negotiations with third parties with respect to any Acquisition  Proposal, if
any, exiting on the date hereof.

<PAGE>


            2.19. TAX PROTECTION POLICY.

                         (a) Within thirty (30) days of the Closing,  the Parent
shall pay to the Shareholders an amount equal to the difference  between (a) the
tax  liability  which would have been  applicable  to the  Shareholders  had the
Shareholders sold the Company Common Stock instead of agreeing to the Merger and
(b) the actual tax liability of the Shareholders.  In addition and within thirty
(30) days of the  Closing,  the Parent shall pay to the  Shareholders  an amount
such that the net amount retained by the Shareholders after deduction of the tax
liability  imposed on such payment shall be equal to the amount set forth in the
immediately preceding sentence.

                         (b) In the event  installment  sale treatment under the
applicable provisions of the Code is unavailable to the Shareholders as a result
of  the  Merger,   then  the  Parent  shall  advance  without  interest  to  the
Shareholders,  within thirty (30) days of the Parent's receipt of written notice
from the  Shareholders,  an amount equal to the  difference  between (a) the tax
liability which would have been applicable to the  Shareholders  had installment
sale  treatment  been  available  and  (b)  the  actual  tax  liability  of  the
Shareholders.  The Parent shall offset any advance  hereunder against the Second
Earn-Out  Amount.  In the event the Second  Earn-Out  Amount is  insufficient to
satisfy the advance  payable  pursuant to this  Section,  then the  Shareholders
shall repay such  advance in cash not later than the  payment  date of the Third
Installment in accordance with Section 1.2.2 hereof.

                         (c) The amount set forth in the  Section  2.19 shall be
determined by the Shareholders and reviewed and accepted by the Parent,  subject
to the dispute resolution set forth in Section 1.6 hereof.

        3.  REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE SHAREHOLDERS.

        To induce  Parent and Merger  Sub to enter  into this  Agreement  and to
consummate  the   transactions   contemplated   hereby,   the  Company  and  the
Shareholders  jointly and  severally  represent and warrant to and covenant with
Parent and Merger Sub as follows:

            3.1.  ORGANIZATION;  COMPLIANCE.  The Company is a corporation  duly
organized,  validly existing and in good standing under the laws of Florida. The
Company  is: (a)  entitled  to own or lease its  properties  and to carry on its
business as and in the places where such business is now conducted, and (b) duly
licensed and qualified in all jurisdictions  where the character of the property
owned by it or the nature of the business transacted by it makes such license or
qualification necessary, except where the failure to do so would not result in a
material  adverse effect on the Company.  Schedule 3.1 lists all locations where
the Company has an office or place of business  and the nature of the  ownership
interest in such property (fee, lease, or other).



<PAGE>



            3.2.    CAPITALIZATION AND RELATED MATTERS.

                         (a) The Company has an authorized capital consisting of
7,500 shares of common  stock,  300 of which are issued and  outstanding  at the
date hereof.  All shares of Company  Common  Stock are duly and validly  issued,
fully paid and nonassessable.  No shares of Company Common Stock (i) were issued
in violation of the preemptive  rights of any  shareholder,  or (ii) are held as
treasury stock.

                         (b)   There   are  not   outstanding   any   securities
convertible into capital stock of the Company nor any rights to subscribe for or
to purchase, or any options for the purchase of, or any agreements providing for
the issuance  (contingent or otherwise) of, or any calls,  commitments or claims
of any character relating to, such capital stock or securities  convertible into
such  capital  stock.  The  Company:  (i)  is  not  subject  to  any  obligation
(contingent  or otherwise)  to repurchase or otherwise  acquire or retire any of
its capital stock; or (ii) has no liability for dividends or other distributions
declared or accrued, but unpaid, with respect to any capital stock.

                         (c) Each  Shareholder  is, and will be at Closing,  the
record and beneficial  owner of one hundred fifty (150) shares of Company Common
Stock, free and clear of all claims, liens, options,  agreements,  restrictions,
and  encumbrances  whatsoever  and no  Shareholder  is a party to any agreement,
understanding or arrangement, direct or indirect, relating to the Company Common
Stock, including, without limitation, agreements, understandings or arrangements
regarding voting or sale of such stock.

            3.3.  SUBSIDIARIES.  The Company owns (a) no shares of capital stock
of any other  corporation,  including any joint stock company,  and (b) no other
proprietary  interest  in any  company,  partnership,  trust  or  other  entity,
including any limited liability company.

            3.4. EXECUTION; NO INCONSISTENT AGREEMENTS; ETC.

                         (a) This Agreement is a valid and binding  agreement of
each  Shareholder,  enforceable  in  accordance  with its terms,  except as such
enforcement  may  be  limited  by  bankruptcy  or  similar  laws  affecting  the
enforcement of creditors'  rights  generally,  and the availability of equitable
remedies.  Each  Shareholder  has the absolute and  unrestricted  right,  power,
authority,  and capacity to execute and deliver this Agreement and the documents
to be  delivered  by him in  connection  with the  Closing  and to  perform  his
obligations under this Agreement.

                         (b) Except as set forth in Schedule  3.4, the execution
and  delivery  of  this  Agreement  by  the  Shareholders   does  not,  and  the
consummation  of the  transactions  contemplated  hereby will not,  constitute a
breach or violation of the charter or bylaws of the Company,  or a default under
any of the terms,  conditions or provisions of (or an act or omission that would
give rise to any right of termination,  cancellation or acceleration  under) any
note, bond,  mortgage,  lease,  indenture,  agreement or obligation to which the
Company or any  Shareholder  is a party,  pursuant  to which the  Company or any
Shareholder

<PAGE>


otherwise receives benefits, or to which any of the properties of the Company or
any Shareholder is subject, or violate any judgment,  order, decree,  statute or
regulation applicable to the Company or the Shareholders or by which any of them
may be subject.

            3.5. CORPORATE RECORDS.  The statutory records,  including the stock
register and minute books of the Company, fully reflect all issuances, transfers
and redemptions of its capital stock, currently show and will correctly show the
total number of shares of its capital stock issued and  outstanding  on the date
hereof and on the Closing Date,  the charter or other  organizational  documents
and all amendments thereto, the bylaws as amended and currently in force. To the
knowledge of  Shareholders,  the books of account,  minute books,  stock record,
books,  and other records of the Company,  all of which have been made available
to Parent,  are complete and correct and have been maintained in accordance with
sound business  practices.  The minute books of the Company contain accurate and
complete  records of all meetings  held of, and  corporate  action taken by, the
shareholders,  the Board of Directors, and committees of the Boards of Directors
of the Company, and no meeting of any such shareholders,  Board of Directors, or
committee  has been held for which  minutes  have not been  prepared and are not
contained in such minute books.  At the Closing,  all of those books and records
will be in the possession of the Company.

            3.6. FINANCIAL STATEMENTS.

                         (a) The  Shareholders  have delivered to Parent (i) the
audited  balance  sheet of the Company as of December 31, 1998,  and the related
statements of income, stockholders' equity and cash flows of the Company for the
fiscal year ended December 31, 1998 and the independent auditors' report thereon
and (ii) the  unaudited  balance sheet of the Company as of May 31, 1999 and the
unaudited statements of income of the Company for the three months ended May 31,
1999 (the balance  sheet as of December 31, 1998 is  hereinafter  referred to as
the "1998 COMPANY BALANCE SHEET"). All the foregoing financial  statements,  and
any  financial  statements  delivered  pursuant  to  Subsection  (c) below,  are
referred to herein collectively as the "COMPANY FINANCIAL STATEMENTS."

                         (b) The Company Financial Statements have been and will
be prepared in accordance with GAAP throughout the periods involved, subject, in
the  case  of  interim  financial  statements,   to  normal  recurring  year-end
adjustments (the effect of which will not, individually or in the aggregate,  be
materially  adverse) and the absence of notes  (that,  if  presented,  would not
differ  materially  from those  included  in the 1998  Company  Balance  Sheet),
applied on a  consistent  basis,  and  fairly  reflect  and will  reflect in all
material respects the financial condition of the Company as at the dates thereof
and the results of the operations of the Company for the periods then ended, and
are true and  complete  and are  consistent  with the books and  records  of the
Company.

                         (c) Until  Closing,  the  Shareholders  will furnish to
Parent  unaudited  interim  financial  statements  of the Company for each month
subsequent to May 31, 1999 as soon as practicable but in any event within thirty
(30) days after the close of any such month.

<PAGE>


            3.7.  LIABILITIES.  The Company has no debt, liability or obligation
of any kind,  whether accrued,  absolute,  contingent or otherwise,  except: (a)
those reflected on the 1998 Company Balance Sheet,  including the notes thereto,
and (b)  liabilities  incurred in the ordinary course of business since December
31, 1998,  none of which have had or will have a material  adverse effect on the
financial condition of the Company.

            3.8.  ABSENCE OF CHANGES.  Except as described in Schedule 3.8, from
December 31, 1998 to the date of this Agreement:

                         (a)  there  has not  been  any  adverse  change  in the
business, assets,  liabilities,  results of operations or financial condition of
the  Company  or in its  relationships  with  suppliers,  customers,  employees,
lessors or others,  other than changes in the ordinary course of business,  none
of which,  singularly  or in the  aggregate,  have had or will  have a  material
adverse  effect  on the  business,  properties  or  financial  condition  of the
Company;

                         (b) there has not been any: (i) change in the Company's
authorized or issued  capital  stock,  retirement,  or other  acquisition by the
Company of any shares of any such capital  stock;  (ii) a declaration or payment
of any dividend or other distribution or payment in respect of shares of capital
stock,  except as set forth on Schedule 3.29; (iii) amendment to the articles of
incorporation  or bylaws of the  Company;  (iv)  increase  by the Company of any
bonuses, salaries, or other compensation to any shareholder,  director, officer,
or  (except  in the  ordinary  course of  business)  employee  or entry into any
employment,  severance,  or similar  agreement  with any director,  officer,  or
employee; (v) adoption of, or increase in the payments to or benefits under, any
profit sharing,  bonus,  deferred  compensation,  savings,  insurance,  pension,
retirement,  or other  employee  benefit  plan for or with any  employees of the
Company;  (vi) sale (other than sales of  inventory  in the  ordinary  course of
business),  lease, or other  disposition of any asset or property of the Company
or mortgage,  pledge,  or  imposition  of any lien or other  encumbrance  on any
material asset or property of the Company;  (vii)  cancellation or waiver of any
claims or rights  with a value to the  Company  in  excess  of  $10,000;  (viii)
material  change  in the  accounting  methods  used  by  the  Company;  or  (ix)
agreement,  whether oral or written,  by the Company to do any of the foregoing;
and

                         (c) the Company has  complied  with the  covenants  and
restrictions  set forth in Section 5 to the same extent as if this Agreement had
been executed on, and had been in effect since, December 31, 1998.

            3.9. TITLE TO PROPERTIES.  The Company has good and marketable title
to all of its  properties  and assets,  real and  personal,  including,  but not
limited to, those  reflected in the 1998 Company Balance Sheets (except as since
sold  or  otherwise  disposed  of in the  ordinary  course  of  business,  or as
expressly  provided for in this Agreement),  free and clear of all encumbrances,
liens or charges of any kind or character except: (a) those securing liabilities
of the Company incurred in the ordinary course (with respect to which no default
exists);  (b) liens of 1999 real estate and  personal  property  taxes;  and (c)
imperfections of title and encumbrances, if any, which, in the aggregate (i) are
not  substantial  in amount;  (ii) do not detract from the value of the property
subject  thereto or impair the  operations  of the  Company or; and (iii) do not
have a material  adverse  effect on the  business,  properties  or assets of the
Company.


<PAGE>

            3.10.  COMPLIANCE  WITH LAW.  The  business  and  activities  of the
Company  has at all times been  conducted  in  accordance  with its  articles of
incorporation and bylaws and any applicable law, regulation,  ordinance,  order,
License (defined below), permit, rule, injunction or other restriction or ruling
of any court or administrative or governmental agency, ministry, or body, except
where the failure to do so would not result in a material  adverse effect on the
Company.

            3.11.  TAXES.  The Company has duly filed all  federal,  state,  and
material local and foreign tax returns and reports,  and all returns and reports
of all other  governmental  units  having  jurisdiction  with  respect  to taxes
imposed on it or on its income,  properties,  sales,  franchises,  operations or
employee  benefit  plans or trusts,  all such returns were complete and accurate
when filed, and all taxes and assessments  payable by the Company have been paid
to the extent that such taxes have become due.  All taxes  accrued or payable by
the Company for all  periods  through May 31, 1999 have been  accrued or paid in
full,  whether or not due and payable and whether or not  disputed.  The Company
has withheld  proper and accurate  amounts from its employees for all periods in
full  compliance  with the tax  withholding  provisions of  applicable  foreign,
federal,  state and local tax laws.  There are no waivers or  agreements  by the
Company for the extension of time for the assessment of any taxes. There are not
now any  examinations of the income tax returns of the Company  pending,  or any
proposed  deficiencies or assessments against the Company of additional taxes of
any kind.  The  Shareholders  shall cause the Company to duly and timely prepare
and file all  federal,  state,  and  material  local and foreign tax returns and
reports for 1999,  and all returns and reports of all other  governmental  units
having  jurisdiction  with  respect to taxes  imposed  on the  Company or on its
income, properties,  sales, franchises,  operations or employee benefit plans or
trusts,  and all such  returns will be complete  and  accurate  when filed.  The
Company has been a validly existing S Corporation within the meaning of Sections
1361 and 1362 of the Code  since  its  inception  and the  Company  will be an S
Corporation up to and including the Closing Date.

            3.12. REAL PROPERTIES.  The Company does not have an interest in any
real property, except for the Leases (as defined below).

            3.13.  LEASES OF REAL  PROPERTY.  All leases  pursuant  to which the
Company is lessee of any real  property  (the  "LEASES")  are listed in Schedule
3.13 and are valid and enforceable in accordance with their terms.  There is not
under any of such leases any material default or any claimed material default by
the Company or any event of default or event which with notice or lapse of time,
or both,  would  constitute a material  default by the Company and in respect to
which the Company has not taken  adequate steps to prevent a default on its part
from  occurring.  The copies of the Leases  heretofore  furnished  to Parent are
true,  correct  and  complete,  and such  Leases  have not been  modified in any
respect since the date they were so furnished,  and are in full force and effect
in  accordance  with their terms.  The Company is lawfully in  possession of all
real properties of which they are a lessee (the "LEASED PROPERTIES").

            3.14. Contingencies. Except as disclosed on Schedule 3.14, there are
no  actions,  suits,  claims or  proceedings  pending,  or to the  knowledge  of
Shareholders  threatened against,  by or affecting,  the Company in any court or
before any arbitrator or  governmental  agency that may have a material  adverse
effect on the

<PAGE>

Company or which could  materially and adversely  affect the right or ability of
any  Shareholder  to consummate the  transactions  contemplated  hereby.  To the
knowledge  of the  Shareholders,  there is no valid  basis  upon  which any such
action,  suit,  claim,  or proceeding  may be commenced or asserted  against the
Company.  There are no unsatisfied  judgments against the Company and no consent
decrees or similar  agreements  to which the  Company is subject and which could
have a material adverse effect on the Company.

            3.15.  INTELLECTUAL  PROPERTY  RIGHTS.  The  Company  has:  (a)  the
exclusive right to use the name American Micro Computer  Center in Florida,  and
the use of such name does not conflict  with or infringe  upon the rights of any
other person,  and (b) made all material  filings and  publications  required to
register and perfect such exclusive  right. The Company is not, and will not be,
subject  to  any  liability,  direct  or  indirect,  for  infringement  damages,
royalties,  or otherwise,  by reason of (a) the use of the name "American  Micro
Computer Center" in or outside the United States or (b) the business  operations
of the Company, at any time prior to the Closing Date.

            3.16. MATERIAL CONTRACTS.  Schedule 3.16 contains a complete list of
all  contracts  of the  Company  which  involve  consideration  in excess of the
equivalent  of  $10,000  or have a term  of one  year  or  more  (the  "MATERIAL
CONTRACTS").  The Company has  delivered to Parent a true,  correct and complete
copy of each of the  written  contracts,  and a summary  of each oral  contract,
listed on Schedule  3.16.  Except as disclosed in Schedule 3.16: (a) the Company
has  performed  all  material  obligations  to be performed by it under all such
contracts,  and is not in material default thereof,  and (b) no condition exists
or has occurred  which with the giving of notice or the lapse of time,  or both,
would  constitute a material  default by the Company or accelerate  the maturity
of, or otherwise  modify,  any such contract,  and (c) all such contracts are in
full force and  effect.  No  material  default by any other party to any of such
contracts is known or claimed by the Company or any Shareholder to exist.

            3.17.  INSURANCE.  Schedule  3.17  contains a  complete  list of all
policies of insurance presently  maintained by the Company all of which are, and
will be maintained  through the Closing Date, in full force and effect;  and all
premiums  due thereon have been paid and the Company has not received any notice
of cancellation  with respect thereto.  The Company has heretofore  delivered to
Parent or its  representatives  a true,  correct and complete  copy of each such
insurance policy.

            3.18.  EMPLOYMENT  AND LABOR  MATTERS.  Schedule 3.18 sets forth the
name, position,  employment date, and 1998 compensation (base and bonus) of each
employee of the Company who earned $25,000 or more in 1998. The Company is not a
party to any  collective  bargaining  agreement  (whether  industry wide or on a
company  level) or agreement  of any kind with any union or labor  organization.
There has not been any  attempt  by any  union or other  labor  organization  to
organize  the  employees  of the Company at any time in the past five (5) years.
Except as disclosed in Schedule  3.18, the Company is not a party to or bound by
any employment contract,  consulting agreement, deferred compensation agreement,
bonus plan, incentive plan, profit sharing plan, retirement agreement,  or other
employee  compensation  agreement.  The Company is not aware that any officer or
key employee,  or that any group of key  employees,  intends to terminate  their
employment  with the Company,  nor does the Company have a present  intention to
terminate the employment of any of the foregoing.

<PAGE>


            3.19. EMPLOYEE BENEFIT MATTERS.

                         (a) Except as disclosed in Schedule  3.19,  the Company
does not provide,  nor is it obligated to provide,  directly or indirectly,  any
benefits for  employees  other than  salaries,  sales  commissions  and bonuses,
including,  but not limited  to, any  pension,  profit  sharing,  stock  option,
retirement,  bonus,  hospitalization,  insurance,  severance,  vacation or other
employee benefits (including any housing or social fund contributions) under any
practice, agreement or understanding.

                         (b) Each  employee  benefit  plan  maintained  by or on
behalf of the  Company or any other  party  (including  any  terminated  pension
plans) which covers or covered any employees or former  employees of the Company
(collectively,  the "EMPLOYEE  BENEFIT  PLAN") is listed in Schedule  3.19.  The
Company has  delivered to Parent true and complete  copies of all such plans and
any  related  documents.  With  respect  to each such plan:  (i) no  litigation,
administrative  or other proceeding or claim is pending,  or to the knowledge of
the Shareholders,  threatened or anticipated involving such plan; (ii) there are
no outstanding requests for information by participants or beneficiaries of such
plan;  and (iii) such plan has been  administered  in compliance in all material
respects with all applicable laws and regulations.

                         (c) The Company has timely made  payment in full of all
contributions  to all of the  Employee  Benefit  Plans  which  the  Company  was
obligated  to make  prior to the date  hereof;  and there  are no  contributions
declared or payable by the Company to any Employee Benefit Plan which, as of the
date hereof, has not been paid in full.

            3.20.  POSSESSION OF  FRANCHISES,  LICENSES,  ETC. The Company:  (a)
possess  all  material  franchises,  certificates,  licenses,  permits and other
authorizations  (collectively,  the "Licenses") from  governmental  authorities,
political  subdivisions  or  regulatory  authorities  that are necessary for the
ownership,  maintenance  and  operation of its business in the manner  presently
conducted;  (b) are not in violation  of any  provisions  thereof;  and (c) have
maintained  and amended,  as  necessary,  all Licenses  and duly  completed  all
filings and notifications in connection therewith.

            3.21.  ENVIRONMENTAL MATTERS.  Except as disclosed in Schedule 3.21:
(i)  the  Company  is  not  in  violation,  in  any  material  respect,  of  any
Environmental Law (as defined below);  (ii) the Company has received all permits
and  approvals  with respect to emissions  into the  environment  and the proper
collection,  storage, transport,  distribution or disposal of Wastes (as defined
below) and other materials required for the operation of its business at present
operating  levels;  and (iii) the Company is not liable or  responsible  for any
material clean up, fines,  liability or expense arising under any  Environmental
Law,  as a result of the  disposal  of Wastes  or other  materials  in or on the
property  of the  Company  (whether  owned  or  leased),  or in or on any  other
property,  including property no longer owned, leased or used by the Company. As
used herein, (a)  "ENVIRONMENTAL  LAWS" means,  collectively,  the Comprehensive
Environmental Response,  Compensation and Liability Act of 1980, as amended, the
Superfund Amendments and Reauthorization Act of 1986, the Resource  Conservation
and Recovery Act, the Toxic  Substances  Control Act, as amended,  the Clean Air
Act, as amended,  the Clean Water Act,  as  amended,  any other  "Superfund"  or
"Superlien" law or any other federal, or applicable state or local statute, law,

<PAGE>

ordinance,  code,  rule,  regulation,  order or  decree  (foreign  or  domestic)
regulating,   relating  to,  or  imposing  liability  or  standards  of  conduct
concerning,  Wastes, or the environment; and (b) "WASTES" means and includes any
hazardous,  toxic or dangerous waste,  liquid,  substance or material (including
petroleum  products  and  derivatives),   the  generation,   handling,  storage,
disposal, treatment or emission of which is subject to any Environmental Law.

            3.22. INVENTORIES. At Closing, Shareholders will deliver to Parent a
complete and accurate  list,  as of a date not more than five (5) business  days
prior to the Closing  Date,  of the  products,  materials and supplies and spare
parts (the "INVENTORY") then owned by the Company.  Except as otherwise provided
on Schedule  3.22,  the  Inventory,  as of the Closing Date:  (a) will represent
items of a quality and quantity  usable and  saleable in the ordinary  course of
business at the book value  reflected as of the Closing  Date,  (b) will be free
from  defects,  (c)  will not be  obsolete,  (d) will  conform  in all  material
respects to  customary  trade  standards  for such  inventory  in the  Company's
current  markets and (e) will be sold,  subject to any  applicable  reserves for
inventory  obsolescence shown on the Company's books and records (which reserves
are adequate and calculated  consistent with past practice),  within two hundred
forty  (240) days of the  Closing  Date for an amount at least equal to its book
value.  There are no express  or implied  warranty  obligations  of the  Company
which,  singularly or in the aggregate,  will have a material  adverse effect on
the business, properties or financial condition of the Company.

            3.23.  ACCOUNTS  RECEIVABLE.  On the Closing Date, the  Shareholders
will deliver to Parent a complete and accurate  list, as of a date not more than
five (5)  business  days prior to the Closing  Date,  of the  accounts and notes
receivable due to the Company (including,  without limitation,  receivables from
advances to  employees  and the  Shareholders),  which  includes an aging of all
accounts  and notes  receivable  showing  amounts  due in thirty  (30) day aging
categories (collectively,  the "ACCOUNTS RECEIVABLES").  As of the Closing Date,
the Accounts Receivable: (a) will represent valid obligations arising from sales
actually made or services actually performed in the ordinary course of business;
(b) will be current and collectible net of any applicable  reserves shown on the
Company's  books  and  records  (which  reserves  are  adequate  and  calculated
consistent with past practice);  (c) subject to such reserves, will be collected
in full,  without any  set-off,  within one  hundred  fifty (150) days after the
Closing  Date;  and (d) are not and will not be subject to any  contest,  claim,
defense or right of set-off,  other than  rebates  and  returns in the  ordinary
course of business.

            3.24.  AGREEMENTS AND TRANSACTIONS  WITH RELATED PARTIES.  Except as
disclosed on Schedule  3.24,  and except as  disclosed  in the Parent  Financial
Statements,  the Company is not,  and since  December  31, 1997 has not been,  a
party to any  contract,  agreement,  lease or  transaction  with,  or any  other
commitment to, (a) a Shareholder,  (b) any person related by blood,  adoption or
marriage to a Shareholder,  (c) any director or officer of the Company,  (d) any
corporation or other entity in which any of the foregoing  parties has, directly
or indirectly,  at least five percent (5.0%) beneficial  interest in the capital
stock or other type of equity interest in such  corporation or other entity,  or
(e) any  partnership  in which any such party is a general  partner or a limited
partner  having a five percent (5%) or more interest  therein (any or all of the
foregoing being herein referred to as a "RELATED PARTY" and  collectively as the
"RELATED PARTIES"). Without limiting the generality of the foregoing, except as

<PAGE>

set forth in Schedule  3.24,  and except as disclosed  in the Company  Financial
Statements no Related Party, directly or indirectly, owns or controls any assets
or  properties  which  are or have  since  December  31,  1997  been used in the
business of the Company.

            3.25. BUSINESS PRACTICES.  Except as disclosed on Schedule 3.25, the
Company has not, at any time, directly or indirectly,  made any contributions or
payment,  or provided any compensation or benefit of any kind, to any municipal,
county, state, federal or foreign governmental officer or official, or any other
person charged with similar public or quasi-public  duties, or any candidate for
political office. The Company's books, accounts and records (including,  without
limitation,  customer files, product packaging and invoices) accurately describe
and reflect,  in all material  respects,  the nature and amount of the Company's
products,  purchases,  sales  and  other  transactions.   Without  limiting  the
generality  of  the  foregoing,  the  Company  has  not  engaged,   directly  or
indirectly,  in:  (a)  the  practice  known  as  "double-invoicing;"  or (b) the
incorrect or misleading labeling,  marketing or sale of refurbished goods as new
goods or the sale of rebuilt goods as original manufactured equipment.

            3.26.  CONDITION  AND  SUFFICIENCY  OF  ASSETS.  The  buildings  and
equipment  leased  or owned  by the  Company  are  generally  in good  operating
condition and repair, and are adequate for the uses to which they are being put.
The  buildings  and  equipment of the Company are  sufficient  for the continued
conduct of the Company's  business after the Closing in  substantially  the same
manner as conducted prior to the Closing.

            3.27.  ACCOUNTING SYSTEM. The Company's accounting software is owned
or  licensed  by  the  Company,   free  and  clear  of  all  claims,  liens  and
encumbrances,  and the  transactions  contemplated  hereby  will not result in a
breach  of any  license  or  other  agreement  with  respect  to the  accounting
software.  The  Company's  accounting  software  is in good  working  order  and
condition,  free from  defects  (latent  and  patent),  has been  maintained  in
accordance with the manufacturer's  recommended maintenance program, if any, and
is suitable for  maintaining  the books and records of the Company and all other
purposes for which it is intended.

            3.28. YEAR 2000 COMPLIANCE. All of the Company's material properties
and assets, real and personal, including, but not limited to, those reflected on
the 1998 Company Balance Sheet and any business systems,  equipment or processes
using  or  relying  upon  computer  hardware,  microchips,   software  or  their
components  (such as computer  networks,  hardware  and software and all related
business functions) used in the regular course of the business shall: (a) handle
date  information  before,  during and after January 1, 2000,  including but not
limited  to  accepting  date  input,   providing  date  output,  and  performing
calculations  on  dates  or  portions  of  dates  without  error;  (b)  function
accurately  and without  interruption  before,  during and after January 1, 2000
without any change in operations  associated with the advent of the new century;
(c) respond to two-digit year-date input in a way that resolves the ambiguity as
to century in a disclosed,  defined and predetermined  manner, and (d) store and
provide  output of date  information.  All third  parties  upon whom the Company
relies to operate its business are  compliant  with the  foregoing  requirements
that no  notice  of defect or  noncompliance  has been  received  from any third
party.

<PAGE>


            3.29.  DIVIDENDS AND OTHER  DISTRIBUTIONS.  Schedule 3.29 sets forth
the dates and amounts of all dividends and other distributions declared, paid or
payable by the Company to the Shareholders  between January 1, 1999 and the date
hereof, which Schedule 3.29 shall be updated as of the Closing Date to set forth
all dividends and other distributions through the Closing Date.

            3.30.  FULL  DISCLOSURE.   No  representation  or  warranty  of  the
Shareholders  contained  in  this  Agreement,  and  none  of the  statements  or
information   concerning  the  Company  contained  in  this  Agreement  and  the
Schedules,  contains or will contain as of the date hereof and as of the Closing
Date any  untrue  statement  of a material  fact nor will such  representations,
warranties,  covenants  or  statements  taken as a whole  omit a  material  fact
required  to be stated  therein  or  necessary  in order to make the  statements
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading.

        4. REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB.

        To  induce  the  Shareholders  to  enter  into  this  Agreement  and  to
consummate the transactions  contemplated  hereby, each of Parent and Merger Sub
represent and warrant to and covenants with the Shareholders as follows:

            4.1.  ORGANIZATION.  Each of Parent and Merger Sub is a  corporation
duly  organized,  validly  existing and in good standing under the laws of their
respective  states of  incorporation.  Parent  and each of its  subsidiaries  is
entitled to own or lease its  properties  and to carry on its business as and in
the places  where such  business  is now  conducted,  and Parent and each of its
subsidiaries  is duly  licensed  and  qualified in all  jurisdictions  where the
character of the property  owned by it or the nature of the business  transacted
by it makes such license or qualification  necessary,  except where such failure
would not result in a material adverse effect on Parent or its subsidiaries.

            4.2. CAPITALIZATION AND RELATED MATTERS.

                         (a) Parent has authorized  capital stock  consisting of
20,000,000 shares of common stock, par value $0.01 per share, of which 4,933,000
shares were issued and outstanding as of the date hereof,  and 1,000,000  shares
of  preferred  stock,  none of which  are  issued.  The  Parent  owns all of the
outstanding  capital stock of the Merger Sub. The Parent's  Shares will be, when
issued, duly and validly authorized and fully paid and non-assessable,  and will
be  issued  to the  Shareholders  free of all  encumbrances,  claims  and  liens
whatsoever.

                         (b) Except as set forth in Schedule 4.2, and except for
employee stock options to purchase shares of Parent's Common Stock,  Parent does
not have  outstanding  any securities  convertible  into capital stock,  nor any
rights to subscribe  for or to purchase,  or any options for the purchase of, or
any agreements  providing for the issuance  (contingent or otherwise) of, or any
calls,  commitments or claims of any character relating to, its capital stock or
securities convertible into its capital stock.

<PAGE>

            4.3. EXECUTION; NO INCONSISTENT AGREEMENTS; ETC.

                         (a) Subject to the Parent's Board approval contemplated
by Section 7.5 hereof,  the  execution  and delivery of this  Agreement  and the
performance of the transactions  contemplated  hereby have been duly and validly
authorized and approved by Parent,  the Merger Sub and this Agreement is a valid
and binding agreement of Parent and the Merger Sub,  enforceable  against Parent
and the Merger Sub in accordance with its terms,  except as such enforcement may
be limited by bankruptcy or similar laws affecting the enforcement of creditors'
rights generally, and the availability of equitable remedies.

                         (b) The  execution  and  delivery of this  Agreement by
Parent and the Merger Sub does not,  and the  consummation  of the  transactions
contemplated hereby will not, constitute a breach or violation of the charter or
bylaws  of Parent  or the  Merger  Sub,  or a  default  under any of the  terms,
conditions  or  provisions of (or an act or omission that would give rise to any
right of termination,  cancellation  or  acceleration  under) any material note,
bond, mortgage, lease, indenture, agreement or obligation to which Parent or any
of its subsidiaries is a party,  pursuant to which any of them otherwise receive
benefits, or by which any of their properties may be bound.

            4.4. FINANCIAL  STATEMENTS.  Parent has delivered to the Company the
consolidated  audited balance sheets of Parent as at June 30, 1997 and 1998, the
consolidated  unaudited  balance  sheet as of March 31, 1999,  the  consolidated
audited  statement  of income for the two fiscal  years  ended June 30, 1997 and
1998, and the unaudited  statement of income for the nine months ended March 31,
1999  (collectively,  the "PARENT FINANCIAL  STATEMENTS").  The Parent Financial
Statements have been prepared in accordance  with GAAP,  applied on a consistent
basis (except that the unaudited  statements do not contain all the  disclosures
required by GAAP), and fairly reflect in all material  respects the consolidated
financial  condition of Parent and its  subsidiaries as at the dates thereof and
the  consolidated  results of Parent's  operations  for the periods  then ended.
Since March 31, 1999, there has been no material adverse change in the assets or
liabilities,  in the  business or  condition,  financial  or  otherwise,  of the
Parent, or in its results of operations.

            4.5. LIABILITIES. Neither Parent nor any of its subsidiaries has any
material debt,  liability or obligation of any kind, whether accrued,  absolute,
contingent  or  otherwise,  except (a) those  reflected on the Parent  Financial
Statements,  including the notes thereto,  and (b)  liabilities  incurred in the
ordinary course of business since March 31, 1999, none of which have had or will
have a material  adverse  affect on the  financial  condition  of Parent and its
subsidiaries taken as a whole.

            4.6.   CONTINGENCIES.   There  are  no  actions,  suits,  claims  or
proceedings  pending or, to the  knowledge  of Parent's  management,  threatened
against,  by or  affecting  Parent  or any of its  subsidiaries  in any court or
before any arbitrator or governmental agency which could have a material adverse
effect on Parent or its  subsidiaries  or which could  materially  and adversely
affect  the right or  ability  of the  Parent  to  consummate  the  transactions
contemplated  hereby.  To the knowledge of Parent,  there is no valid basis upon
which any such action,  suit,  claim or proceeding  may be commenced or asserted
against the Parent.  There are no  unsatisfied  judgments  against Parent and no
consent decrees or similar agreements to which Parent is subject and which could
have a material  adverse  effect on Parent or its  subsidiaries  or which  could
materially and

<PAGE>

adversely  affect  the  right  or  ability  of  the  Parent  to  consummate  the
transactions contemplated hereby.

            4.7.  FULL  DISCLOSURE.  No  representation  or  warranty  of Parent
contained  in  this  Agreement,  and  none  of  the  statements  or  information
concerning  Parent  contained in this Agreement and the  Schedules,  contains or
will  contain  as of the date  hereof  and as of the  Closing  Date  any  untrue
statement  of  a  material  fact  nor  will  such  representations,  warranties,
covenants or  statements  taken as a whole omit a material  fact  required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.

        5.  CONDUCT OF BUSINESS OF THE COMPANY PENDING CLOSING.

        The Company and the  Shareholders  covenant  and agree that  between the
date hereof and the Closing Date:

            5.1.  BUSINESS  IN THE  ORDINARY  COURSE.  Except  as set  forth  in
Schedule  5.1,  the  business  of the  Company  shall be  conducted  only in the
ordinary  course,  and  consistent  with past  practice.  Without  limiting  the
generality  of the  foregoing,  and  except as set forth in  Schedule  5.1 or as
otherwise approved in writing by Parent:

                         (a) The  Company  shall  not enter  into any  contract,
agreement  or other  arrangement  which would  constitute  a Material  Contract,
except for  contracts  to sell or supply  goods or services to  customers in the
ordinary course of business at prices and on terms substantially consistent with
the prior operating practices of the Company;

                         (b)  except  for  sales  of  personal  property  in the
ordinary course of its business,  the Company shall not sell, assign,  transfer,
mortgage,  convey,  encumber  or  otherwise  dispose  of,  or  cause  the  sale,
assignment, transfer, mortgage, conveyance,  encumbrance or other disposition of
any of the assets or properties of the Company or any interest therein;

                         (c) the Company shall not acquire any material  assets,
except  expenditures  made in the  ordinary  course of  business  as  reasonably
necessary to enable the Company to conduct its normal business operations and to
maintain  its normal  inventory of goods and  materials,  at prices and on terms
substantially  consistent  with current market  conditions  and prior  operating
practices;

                         (d) the Company shall maintain in full force and effect
all  insurance  policies  referred to in Section 3.17 hereof or other  insurance
equivalent thereto;

                         (e) the books,  records  and  accounts  of the  Company
shall be maintained in the usual,  regular and ordinary  course of business on a
basis consistent with prior practices and in accordance with GAAP;

                         (f) the Company  shall use its best efforts to preserve
its business organization, to preserve the good will of its suppliers, customers

<PAGE>

and  others  having  business  relations  with the  Company,  and to retain  the
services of key  employees  and agents of the Company  after the Closing Date on
terms acceptable to Parent;


                         (g) except as they may terminate in accordance with the
terms of this  Agreement,  the Company shall keep in full force and effect,  and
not cause a default of any of its obligations under, each of their contracts and
commitments;

                         (h) the  Company  shall  duly  comply  in all  material
respects with all laws applicable to it and to the conduct of its business;

                         (i) the Company  shall not create,  incur or assume any
liability or indebtedness,  except in the ordinary course of business consistent
with past practices;

                         (j) the  Company  shall  not make or commit to make any
capital  expenditures  in  excess  of  ten  thousand  dollars  ($10,000)  in the
aggregate;

                         (k) other than as contemplated  in this Agreement,  the
Company  shall not apply any of its  assets to the direct or  indirect  payment,
discharge,   satisfaction  or  reduction  of  any  amount  payable  directly  or
indirectly to or for the benefit of any Shareholder or any Related Party; and

                         (l) neither the Company nor a Shareholder shall take or
omit  to  take  any  action  which  would   render  any  of  the   Shareholders'
representations  or warranties untrue or misleading,  or which would be a breach
of any of the Shareholders' covenants.

            5.2. NO MATERIAL  CHANGES.  The Company shall not, without the prior
written consent of the Parent which consent shall not be unreasonably  withheld,
materially  alter its  organization,  capitalization,  or  financial  structure,
practices or operations. Without limiting the generality of the foregoing:

                         (a)  no  change  shall  be  made  in  the  articles  of
incorporation or bylaws of the Company;

                         (b) no change shall be made in the authorized or issued
capital stock of the Company;

                         (c) the  Company  shall not issue or grant any right or
option to  purchase  or  otherwise  acquire  any of its  capital  stock or other
securities;

                         (d) no dividend or other  distribution or payment shall
be declared or made with  respect to any of the capital  stock of the Company in
excess of an aggregate of $100,000; and

                         (e) no  change  shall  be made  affecting  the  banking
arrangements of the Company, except as set forth in Section 2.14.

<PAGE>

            5.3. COMPENSATION.  No increase shall be made in the compensation or
employee  benefits  payable  or to  become  payable  to any  director,  officer,
employee or agent of the Company,  and no bonus or profit-share payment or other
arrangement  (whether  current  or  deferred)  shall be made to or with any such
director,  officer, employee or agent, except in the ordinary course of business
and consistent with prior practices.

            5.4.  NOTIFICATION.  Each  party to this  Agreement  shall  promptly
notify the other parties in writing of the occurrence, or threatened occurrence,
of any event that would  constitute a breach or  violation of this  Agreement by
any  party or that  would  cause  any  representation  or  warranty  made by the
notifying  party in this  Agreement  to be false or  misleading  in any respect.
Shareholders  will promptly  notify Parent of any event of which any Shareholder
obtains  knowledge  which could have a material  adverse effect on the business,
assets, financial condition or prospects of the Company. Shareholders shall have
the  right to  update  the  Schedules  to this  Agreement  immediately  prior to
Closing;  provided,  if such update  discloses  any breach of a  representation,
warranty, covenant or obligation of Shareholders, Parent shall have the right to
then exercise its available rights and remedies hereunder.

        6. CONDITIONS TO OBLIGATIONS OF ALL PARTIES.

        The  obligation  of  the  Shareholders  and  Parent  to  consummate  the
transactions contemplated by this Agreement are subject to the satisfaction,  on
or before the Closing, of each of the following conditions;  any or all of which
may be  waived  in whole or in part by the joint  agreement  of  Parent  and the
Shareholders:

            6.1.  ABSENCE OF ACTIONS.  No action or  proceeding  shall have been
brought or threatened before any court or  administrative  agency to prevent the
consummation  or  to  seek  damages  in a  material  amount  by  reason  of  the
transactions  contemplated  hereby,  and no  governmental  authority  shall have
asserted  that  the  within  transactions  (or  any  other  pending  transaction
involving Parent, any of its subsidiaries,  the Shareholders or the Company when
considered in light of the effect of the within transactions) shall constitute a
violation  of law or  give  rise  to  material  liability  on  the  part  of the
Shareholders, the Company or Parent or its subsidiaries.

            6.2.  CONSENTS.  The parties shall have received from any suppliers,
lessors, lenders, lien holders or governmental  authorities,  bodies or agencies
having jurisdiction over the transactions contemplated by this Agreement, or any
part hereof,  such consents,  authorizations  and approvals as are necessary for
the consummation hereof, including,  without limitation,  the consents listed on
Schedule 6.2.

            6.3.  COMPLIANCE WITH  AGREEMENTS AND  CONDITIONS.  The Parent shall
have performed and complied with all material agreements and conditions required
by this  Agreement to be  performed or complied  with by them prior to or on the
Closing Date.

            6.4. HSR ACT. All  applicable  waiting  periods under the Hart Scott
Rodino  Antitrust  Improvements  Act of 1976, as amended (the "HSR Act"),  shall
expire or have been terminated.

<PAGE>

        7. CONDITIONS TO OBLIGATIONS OF PARENT.

        All obligations of Parent to consummate the transactions contemplated by
this Agreement are subject to the fulfillment and satisfaction of each and every
of the following  conditions on or prior to the Closing, any or all of which may
be waived in whole or in part by Parent:

            7.1.   REPRESENTATIONS  AND  WARRANTIES.   The  representations  and
warranties  contained  in Section 3 of this  Agreement  and in any  certificate,
instrument,  schedule,  agreement or other writing  delivered by or on behalf of
the  Shareholders  in  connection  with the  transactions  contemplated  by this
Agreement shall be true,  correct and complete in all material  respects (except
for  representations  and  warranties  which  are by their  terms  qualified  by
materiality,  which shall be true,  correct and complete in all  respects) as of
the date when made and shall be deemed to be made again at and as of the Closing
Date and  shall be true,  correct  and  complete  at and as of such  time in all
material respects (except for  representations and warranties which are by their
terms qualified by materiality, which shall be true, correct and complete in all
respects).

            7.2.  COMPLIANCE WITH AGREEMENTS AND  CONDITIONS.  The  Shareholders
shall have  performed and complied with all material  agreements  and conditions
required by this  Agreement to be performed or complied  with by them and by the
Company prior to or on the Closing Date.

            7.3. ABSENCE OF MATERIAL ADVERSE CHANGES. No material adverse change
in the business,  assets, financial condition, or prospects of the Company shall
have  occurred,   no  substantial   part  of  the  assets  of  the  Company  not
substantially  covered by  insurance  shall have been  destroyed  due to fire or
other  casualty,  and no event shall have occurred  which has had or will have a
material  adverse  effect  on  the  business,  assets,  financial  condition  or
prospects of the Company.

            7.4.  CERTIFICATE OF THE SHAREHOLDERS.  The Shareholders  shall have
executed and delivered, or caused to be executed and delivered, to Parent one or
more certificates,  dated the Closing Date,  certifying in such detail as Parent
may reasonably  request to the  fulfillment  and  satisfaction of the conditions
specified in Sections 7.1 through 7.3 above.

            7.5.   BOARD   APPROVAL.   This   Agreement  and  the   transactions
contemplated  hereby shall have been approved by (a) the  unanimous  approval of
the special Acquisition  Committee of the Parent's Board of Directors formed for
the purpose of  evaluating  this  Agreement  and the  transactions  contemplated
hereby  and,  upon the  approval  of such  committee,  (b) the  approval  of the
Parent's Board of Directors.

            7.6.  FAIRNESS  OPINION.  The Parent shall have  received an opinion
from Morgan  Keegan & Company Inc. or another  investment  banking firm or other
financial advisor satisfactory to the Parent in its sole discretion stating that
the  transaction  taken as a whole is fair from a financial point of view to the
Parent and its public shareholders.

            7.7.  MODIFICATION OF NOTES PAYABLE. The notes payable identified on
the 1998  Company  Balance  Sheet  and any other  notes  payable  arising  after
December  31, 1998 shall have been  modified in  accordance  with  Section  2.14
hereof.

<PAGE>

            7.8.  SATISFACTORY  RESULTS  OF  INSPECTION.   The  results  of  the
inspection referred to in Section 2.1 (including, without limitation, the taking
of a physical  inventory) hereof shall be satisfactory to the Parent in its sole
discretion.

            7.9.  EXECUTION OF EMPLOYMENT  AGREEMENT BY JOHN P.  GALLAGHER.  The
Parent  shall have  received a copy of the  employment  agreement in the form of
EXHIBIT "E" hereto which has been duly executed by John P. Gallagher.

            7.10.  EXECUTION OF EMPLOYMENT  AGREEMENT BY JOHN B. GALLAGHER.  The
Parent  shall have  received a copy of the  Employment  Agreement in the form of
EXHIBIT "F" hereto which has been duly executed by John B. Gallagher.

            7.11.  EXECUTION OF EMPLOYMENT  AGREEMENT BY RICH NILES.  The Parent
shall have received a copy of the  Employment  Agreement of Rich Niles in a form
and substance satisfactory to Parent which has been duly executed by Rich Niles.

        8. CONDITIONS TO OBLIGATIONS OF THE SHAREHOLDERS.

        All  of  the   obligations  of  the   Shareholders   to  consummate  the
transactions  contemplated  by this Agreement are subject to the fulfillment and
satisfaction  of each and every of the  following  conditions on or prior to the
Closing,  any or  all of  which  may  be  waived  in  whole  or in  part  by the
Shareholders:

            8.1.   REPRESENTATIONS  AND  WARRANTIES.   The  representations  and
warranties  contained  in Section 4 of this  Agreement  and in any  certificate,
instrument,  schedule,  agreement or other writing  delivered by or on behalf of
Parent in connection with the transactions  contemplated by this Agreement shall
be true and correct in all material  respects  (except for  representations  and
warranties  which are by their terms  qualified by  materiality,  which shall be
true,  correct and complete in all respects) when made and shall be deemed to be
made  again at and as of the  Closing  Date and  shall be true at and as of such
time in all material respects (except for  representations  and warranties which
are by their terms  qualified by materiality,  which shall be true,  correct and
complete in all respects).

            8.2.  COMPLIANCE WITH  AGREEMENTS AND CONDITIONS.  Parent shall have
performed and complied with all material  agreements and conditions  required by
this  Agreement to be  performed  or complied  with by Parent prior to or on the
Closing Date.

            8.3. ABSENCE OF MATERIAL ADVERSE CHANGES. No material adverse change
in the business,  assets,  financial  condition,  or prospects of Parent and its
subsidiaries,  taken as a whole, shall have occurred, no substantial part of the
assets  of  Parent  and its  subsidiaries,  taken as a whole,  shall  have  been
destroyed due to fire or other casualty,  and no event shall have occurred which
has had,  or will  have a  material  adverse  effect  on the  business,  assets,
financial  condition  or prospects  of Parent and its  subsidiaries,  taken as a
whole.

            8.4.  CERTIFICATE  OF PARENT.  Parent  shall have  delivered  to the
Shareholders  a  certificate,  executed  by an  executive  officer and dated the
Closing Date, certifying in such detail as counsel for the Shareholder may

<PAGE>


reasonably  request  to the  fulfillment  and  satisfaction  of  the  conditions
specified in Sections 8.1 through 8.3 above.

            8.5.  EXECUTION OF  EMPLOYMENT  AGREEMENT  BY THE  COMPANY.  John P.
Gallagher shall have received a copy of the Employment  Agreement in the form of
EXHIBIT "E" hereto duly executed by the Merger Sub.

            8.6.  EXECUTION OF  EMPLOYMENT  AGREEMENT  BY THE  COMPANY.  John B.
Gallagher shall have received a copy of the Employment  Agreement in the form of
EXHIBIT "F" hereto duly executed by the Merger Sub.

        9. INDEMNITY.

            9.1.  INDEMNIFICATION  BY  SHAREHOLDERS.  Subject  to  Section  9.5,
Shareholders  (hereinafter  collectively  called the  "SHAREHOLDER  INDEMNITOR")
shall jointly and severally  defend,  indemnify and hold harmless Parent and the
Merger  Sub and their  direct and  indirect  parent  corporations,  subsidiaries
(including the Company after Closing) and affiliates, their officers, directors,
employees and agents  (hereinafter  collectively  called  "PARENT  INDEMNITEES")
against and in respect of any and all loss, damage,  liability,  fine,  penalty,
cost and  expense,  including  reasonable  attorneys'  fees and amounts  paid in
settlement (collectively,  "PARENT LOSSES"),  suffered or incurred by any Parent
Indemnitee by reason of, or arising out of:

                         (a) any misrepresentation, breach of warranty or breach
or  nonfulfillment  of  any  agreement  of any  Shareholder  contained  in  this
Agreement or in any certificate,  schedule,  instrument or document delivered to
Parent  by or on behalf  of the  Shareholders  or the  Company  pursuant  to the
provisions of this Agreement (without regard to materiality thresholds contained
therein); and

                         (b)  any  liabilities  of the  Company  of  any  nature
whatsoever (including tax liability,  penalties and interest),  whether accrued,
absolute,  contingent  or  otherwise,  (i)  existing  as of the date of the 1998
Company Balance Sheet, and required to be shown therein in accordance with GAAP,
to the extent not  reflected  or  reserved  against in full in the 1998  Company
Balance Sheet;  or (ii) arising or occurring  between  December 31, 1998 and the
Closing Date, except for liabilities arising in the ordinary course of business,
none of which shall have a material adverse effect on the Company; and

                         (c) any  liabilities of the Company in connection  with
the AT&T UniPlan  Service with FlatRate  Agreement (the "AT&T  DISPUTE") as more
particularly described on Schedule 3.14.

            9.2.  INDEMNIFICATION BY PARENT.  Subject to Section 9.5, Parent and
Merger Sub  (hereinafter  called the  "PARENT  INDEMNITOR")  shall  jointly  and
severally  defend,  indemnify and hold harmless  each  Shareholder  (hereinafter
called  "SHAREHOLDER  INDEMNITEE")  against  and in respect of any and all loss,
damage,  liability,  cost and expense,  including reasonable attorneys' fees and
amounts paid in settlement  (collectively,  "SHAREHOLDER  LOSSES"),  suffered or
incurred by Shareholder Indemnitee by reason of or arising out of:

<PAGE>

                         (a) any misrepresentation, breach of warranty or breach
or  non-fulfillment  of any  material  agreement  of  Parent  contained  in this
Agreement  or  in  any  other  certificate,  schedule,  instrument  or  document
delivered  to  the  Shareholders  by or on  behalf  of  Parent  pursuant  to the
provisions of this Agreement (without regard to materiality thresholds contained
therein); and

                         (b)  any  liabilities  of the  Company  of  any  nature
whatsoever (including tax liability,  penalties and interest),  whether accrued,
absolute,  contingent  or  otherwise,  arising  from the  Parent's  ownership or
operation of the Company after  Closing,  but only so long as such  liability is
not the result of an act or omission of the Company or any Shareholder occurring
prior  to  Closing.   Parent  Losses  and   Shareholder   Losses  are  sometimes
collectively referred to as "INDEMNIFIABLE LOSSES."

            9.3.  DEFENSE OF CLAIMS.

                         (a) Each party  seeking  indemnification  hereunder (an
"INDEMNITEE"):  (i) shall provide the other party or parties (the  "INDEMNITOR")
written notice of any claim or action by a third party arising after the Closing
Date for which an  Indemnitor  may be liable under the terms of this  Agreement,
within  ten  (10)  days  after  such  claim  or  action  arises  and is known to
Indemnitee,  and (ii) shall give the  Indemnitor  a  reasonable  opportunity  to
participate in any proceedings and to settle or defend any such claim or action.
The  expenses of all  proceedings,  contests or  lawsuits  with  respect to such
claims or actions shall be borne by the Indemnitor.  If the Indemnitor wishes to
assume the defense of such claim or action,  the  Indemnitor  shall give written
notice to the  Indemnitee  within ten (10) days after notice from the Indemnitee
of such claim or action,  and the Indemnitor shall thereafter assume the defense
of any such claim or liability,  through counsel reasonably  satisfactory to the
Indemnitee,  provided that  Indemnitee may  participate in such defense at their
own expense,  and the Indemnitor  shall, in any event, have the right to control
the defense of the claim or action.

                         (b) If the Indemnitor  shall not assume the defense of,
or if after so assuming it shall fail to defend,  any such claim or action,  the
Indemnitee  may defend  against  any such claim or action in such manner as they
may deem  appropriate and the Indemnitees may settle such claim or litigation on
such  terms  as they  may  deem  appropriate  but  subject  to the  Indemnitor's
approval, such approval not to be unreasonably withheld; provided, however, that
any such settlement shall be deemed approved by the Indemnitor if the Indemnitor
fails to object  thereto,  by written notice to the  Indemnitee,  within fifteen
(15)  days  after  the  Indemnitor's  receipt  of  a  written  summary  of  such
settlement.  The  Indemnitor  shall  promptly  reimburse the  Indemnitee for the
amount of all  expenses,  legal and  otherwise,  incurred by the  Indemnitee  in
connection with the defense and settlement of such claim or action.

                         (c) If a  non-appealable  judgment is rendered  against
any Indemnitee in any action covered by the  indemnification  hereunder,  or any
lien  attaches  to any of the assets of any of the  Indemnitee,  the  Indemnitor
shall  immediately  upon such entry or  attachment  pay such judgment in full or
discharge such lien unless,  at the expense and direction of the Indemnitor,  an
appeal is taken under which the execution of the judgment or satisfaction of the
lien is

<PAGE>

stayed.  If and  when a final  judgment  is  rendered  in any such  action,  the
Indemnitor  shall  forthwith pay such judgment or discharge such lien before any
Indemnitee is compelled to do so.

            9.4. WAIVER.  The failure of any Indemnitee to give any notice or to
take any action  hereunder  shall not be deemed a waiver of any of the rights of
such  Indemnitee  hereunder,  except to the extent that  Indemnitor  is actually
prejudiced by such failure.

            9.5. LIMITATIONS ON INDEMNIFICATION. Notwithstanding anything to the
contrary contained in this Agreement:

                    9.5.1.  TIME  LIMITATION.  No  party  shall  be  responsible
hereunder for any  Indemnifiable  Loss unless the Indemnitee shall have provided
such party with written notice containing a reasonable description of the claim,
action or circumstances  giving rise to such Indemnifiable Loss within three (3)
years after the Closing Date (the "Indemnity Notice Period"); provided, however,
that:

                         (a) with respect to any Indemnifiable Loss resulting or
arising from any breach of a representation or warranty of Shareholders relating
to taxes,  or any tax  liability  of the Company  arising or relating to periods
prior to the Closing Date, the Indemnity Notice Period shall extend for the full
duration of the statute of limitations; and

                         (b)  there  shall be no limit on the  Indemnity  Notice
Period for indemnity claims: (i) against  Shareholders for Indemnifiable  Losses
arising or resulting from a breach of a representation  or warranty  relating to
Environmental  Laws, or any liability  which relates to the handling or disposal
of Wastes or the failure to comply with any Environmental  Law; and (ii) against
any party based on fraud or intentional breach or misrepresentation.

                    9.5.2.  CAPS ON  LOSSES.  The  aggregate  liability  of each
Shareholder  after Closing for Parent Losses shall not exceed an amount equal to
the portion of the Merger  Consideration  paid to each  Shareholder,  except for
Parent  Losses  (a)  based  upon  fraud or  intentional  breach  or  intentional
misrepresentation  or (b) related to any tax or tax liability of the Company for
periods  prior to the Closing Date.  The  aggregate  liability of Parent and the
Merger  Sub after  Closing  for  Seller  Losses  shall  not  exceed  the  Merger
Consideration.

                    9.5.3.  BASKET. No party shall have any liability  hereunder
for  Indemnifiable  Losses  after  Closing,  with  respect  to a  breach  of the
representations  and  warranties  contained  herein,  until the aggregate of all
Indemnifiable  Losses for which the Shareholders as a group or Parent and Merger
Sub as a group,  as applicable,  are  responsible  under this Agreement  exceeds
Twenty-Five  Thousand ($25,000) Dollars (the "Basket");  provided that once such
Basket is exceeded for the Shareholders as a group or Parent and Merger Sub as a
group, as applicable,  the responsible party or parties shall be responsible for
all Indemnifiable Losses, from the first dollar as if such Basket never existed;
and  further  provided  that this  Section  9.5.3 shall not limit in any respect
indemnity  claims:  (a) based upon fraud or  intentional  breach or  intentional
misrepresentation;  (b) arising  from a breach by the Parent  Indemnitor  of any
covenant contained in this Agreement; (c) arising from the AT&T Dispute; (d)

<PAGE>

arising  from a breach by the  Shareholders  of any  representation  or warranty
contained in Section 3.2 hereof;  or (e) related to any tax or tax  liability of
the Company for periods prior to the Closing Date.

                    9.5.4.  OFFSET. Each of Parent and Merger Sub shall have the
right to offset any Parent Losses  against  amounts due the  Shareholders  under
this  Agreement,  including,  without  limitation,  the  Earn-Out  Amount  or  a
promissory  note delivered to Parent  pursuant to Section 1.4.2 hereof.  Each of
Parent and Merger Sub shall collect all Parent Losses by exercising its right of
offset against such amount until the aggregate of such Parent Losses exceeds the
amounts due the  Shareholders;  thereafter,  the Parent  Losses may be collected
directly from the Shareholders.

        10.  TERMINATION.

            10.1.  TERMINATION.  This Agreement may be terminated at any time on
or prior to the Closing:

                         (a) By mutual  consent of Parent and the  Shareholders;
or

                         (b) At the election of Parent if: (i) a Shareholder has
breached  or  failed  to  perform  or  comply  with any of his  representations,
warranties,  covenants or obligations  under this Agreement;  or (ii) any of the
conditions  precedent  set forth in Section 6 or 7 is not  satisfied as and when
required by this  Agreement;  or (iii) the Closing has not been  consummated  by
August 15, 1999; or

                         (c) At the election of the  Shareholders if: (i) Parent
or the Merger Sub has  breached  or failed to perform or comply  with any of its
representations,  warranties,  covenants or obligations under this Agreement; or
(ii)  any of  the  conditions  precedent  set  forth  in  Section  6 or 8 is not
satisfied as and when  required by this  Agreement;  or (iii) if the Closing has
not been consummated by August 15, 1999.

            10.2.  MANNER  AND  EFFECT  OF  TERMINATION.  Written  notice of any
termination ("Termination Notice") pursuant to this Section 10 shall be given by
the party electing  termination of this Agreement  ("Terminating  Party") to the
other party or parties  (collectively,  the "Terminated Party"), and such notice
shall  state  the  reason  for  termination.  The  party  or  parties  receiving
Termination  Notice  shall  have a period  of ten (10)  days  after  receipt  of
Termination  Notice to cure the matters  giving rise to such  termination to the
reasonable  satisfaction of the Terminating Party. If the matters giving rise to
termination are not cured as required hereby, this Agreement shall be terminated
effective  as of the close of business  on the tenth  (10th) day  following  the
Terminated  Party's  receipt of  Termination  Notice.  Upon  termination of this
Agreement  prior to the  consummation  of the Closing and in accordance with the
terms hereof, this Agreement shall become void and of no effect, and none of the
parties  shall have any liability to the others,  except that nothing  contained
herein shall relieve any party from: (a) its obligations  under Sections 2.2 and
2.3; or (b) liability for its intentional breach of any representation, warranty
or covenant  contained  herein,  or its  intentional  failure to comply with the
terms and conditions of this Agreement or to perform its obligations hereunder.

<PAGE>

        11. MISCELLANEOUS.

            11.1. NOTICES.

                         (a)  All   notices,   requests,   demands,   or   other
communications  required or permitted hereunder shall be in writing and shall be
deemed to have been duly given upon receipt if delivered in person,  or upon the
expiration of four (4) days after the date sent, if sent by federal  express (or
similar overnight courier service) to the parties at the following addresses:

            (i)   If to Parent of the Merger Sub:

                      European Micro Holdings, Inc.
                      6073 N.W. 167th Street, Unit C-25
                      Miami, Florida  33015
                      Attn: Harry D.Shieldss, Co-President

                      and

                      Acquisition Committee of European Micro Holdings, Inc.
                      c/o Barrett Sutton
                      Tuke Yopp & Sweeney
                      NationsBank Plaza - Suite 1100
                      414 Union Street
                      Nashville, Tennessee 37219

                      and

                      Acquisition Committee of European Micro Holdings, Inc.
                      c/o Kyle Saxon, Esquire
                      Catlin, Saxon, Tuttle and Evans
                      1700 Alfred I. DuPont Building
                      169 East Flagler Street
                      Miami, Florida 33131-1298

                  with a copy to:

                      Clayton E. Parker, Esq.
                      Kirkpatrick & Lockhart LLP
                      201 South Biscayne Blvd.
                      Suite 2000, Miami Center
                      Miami, Florida 33131

<PAGE>

            (ii)  If to the Shareholders:

                      Mr. John B. Gallagher
                      6073 N.W. 167th Street, Unit C-25
                      Miami, Florida  33015

                         (b)  Notices  may  also be given  in any  other  manner
permitted  by law,  effective  upon  actual  receipt.  Any party may  change the
address to which  notices,  requests,  demands or other  communications  to such
party shall be delivered or mailed by giving notice thereof to the other parties
hereto in the manner provided herein.

            11.2.  SURVIVAL.  Except  as  provided  in the  next  sentence,  the
representations,  warranties,  agreements  and  indemnifications  of the parties
contained  in  this  Agreement  or in  any  writing  delivered  pursuant  to the
provisions  of this  Agreement  shall  survive any  investigation  heretofore or
hereafter  made  by  the  parties  and  the  consummation  of  the  transactions
contemplated  herein  and shall  continue  in full  force and  effect  after the
Closing,  subject  to the  limitations  of  Section  9.5.  The  representations,
warranties and agreements of the Company  contained in this Agreement  shall not
survive the Closing.

            11.3. COUNTERPARTS;  INTERPRETATION.  This Agreement may be executed
in any number of  counterparts,  each of which shall be deemed an original,  and
all of which  shall  constitute  one and the  same  instrument.  This  Agreement
supersedes all prior discussions and agreements between the parties with respect
to the subject  matter hereof,  and this Agreement  contains the sole and entire
agreement  among the parties with  respect to the matters  covered  hereby.  All
Schedules hereto shall be deemed a part of this Agreement.  This Agreement shall
not be altered or amended  except by an  instrument  in writing  signed by or on
behalf of all of the parties hereto.  No ambiguity in any provision hereof shall
be construed  against a party by reason of the fact it was drafted by such party
or its counsel. For purposes of this Agreement: "herein", "hereby", "hereunder",
"herewith",  "hereafter"  and  "hereinafter"  refer  to  this  Agreement  in its
entirety,  and not to any  particular  subsection  or  paragraph.  References to
"including"  means including  without limiting the generality of any description
preceding such term. Nothing expressed or implied in this Agreement is intended,
or shall be construed,  to confer upon or give any person other than the parties
hereto any rights or remedies under or by reason of this Agreement.

            11.4. GOVERNING LAW. The validity and effect of this Agreement shall
be governed by and  construed  and enforced in  accordance  with the laws of the
State of Florida, without regard to principles of conflicts of laws thereof. Any
dispute,  controversy or question of  interpretation  arising under,  out of, in
connection  with or in relation to this Agreement or any amendments  hereof,  or
any  breach or default  hereunder,  shall be  litigated  in the state or federal
courts  in  Miami-Dade  County,  Florida,  U.S.A.  Each  of the  parties  hereby
irrevocably submits to the jurisdiction of any state or federal court sitting in
Miami-Dade County, Florida. Each party hereby irrevocably waives, to the fullest
extent it may  effectively  do so, the defense of an  inconvenient  forum to the
maintenance of any such action in Miami-Dade County, Florida.

<PAGE>


            11.5.  SUCCESSORS AND ASSIGNS;  ASSIGNMENT.  This Agreement shall be
binding upon
and shall inure to the benefit of the parties hereto and their respective heirs,
executors,  legal representatives,  and successors;  provided,  however, that no
Shareholder  may assign this Agreement or any rights  hereunder,  in whole or in
part.

            11.6.   PARTIAL   INVALIDITY  AND   SEVERABILITY.   All  rights  and
restrictions contained
herein may be exercised and shall be  applicable  and binding only to the extent
that they do not violate any  applicable  laws and are intended to be limited to
the extent necessary to render this Agreement legal,  valid and enforceable.  If
any terms of this  Agreement  not  essential to the  commercial  purpose of this
Agreement shall be held to be illegal,  invalid or  unenforceable  by a court of
competent  jurisdiction,  it is the  intention of the parties that the remaining
terms hereof shall constitute their agreement with respect to the subject matter
hereof and all such  remaining  terms shall remain in full force and effect.  To
the extent legally permissible,  any illegal, invalid or unenforceable provision
of this Agreement  shall be replaced by a valid  provision  which will implement
the commercial purpose of the illegal, invalid or unenforceable provision.

            11.7.  WAIVER. Any term or condition of this Agreement may be waived
at any time by the party which is entitled to the benefit  thereof,  but only if
such waiver is  evidenced by a writing  signed by such party.  No failure on the
part of a party hereto to exercise, and no delay in exercising, any right, power
or remedy created  hereunder,  shall operate as a waiver thereof,  nor shall any
single or  partial  exercise  of any  right,  power or remedy by any such  party
preclude any other future  exercise  thereof or the exercise of any other right,
power or  remedy.  No waiver by any party  hereto to any breach of or default in
any term or condition of this Agreement  shall  constitute a waiver of or assent
to any  succeeding  breach  of or  default  in the  same  or any  other  term or
condition hereof.

            11.8. HEADINGS. The headings as to contents of particular paragraphs
of this Agreement are inserted for  convenience  only and shall not be construed
as a part of this  Agreement  or as a  limitation  on the  scope of any terms or
provisions of this Agreement.

            11.9.  EXPENSES.  Except as otherwise expressly provided herein, all
legal and other costs and expenses  incurred in connection  with this  Agreement
and  the  transactions  contemplated  hereby  shall  be paid  by  Parent  or the
Shareholders as each party incurs such expenses, and none of such expenses shall
be charged to or paid by the Company.

            11.10.  FINDER'S FEES. Parent represents to the Shareholders that no
broker,  agent, finder or other party has been retained by it in connection with
the  transactions  contemplated  hereby and that no other fee or commission  has
been  agreed by the  Parent  to be paid for or on  account  of the  transactions
contemplated  hereby.  Shareholders  represent to Parent that no broker,  agent,
finder or other  party has been  retained  by  Shareholders  or the  Company  in
connection with the  transactions  contemplated  hereby and that no other fee or
commission has been agreed by the  Shareholders or the Company to be paid for or
on account of the transactions contemplated hereby.

<PAGE>

            11.11. GENDER.  Where the context requires,  the use of the singular
form herein shall  include the plural,  the use of the plural shall  include the
singular, and the use of any gender shall include any and all genders.

            11.12.   ACCEPTANCE  BY  FAX.  This  Agreement  shall  be  accepted,
effective and binding, for all purposes,  when the parties shall have signed and
transmitted to each other,  by telecopier or otherwise,  copies of the signature
pages hereto.

            11.13.  ATTORNEYS FEES. In the event of any litigation arising under
the terms of this Agreement,  the prevailing  party or parties shall be entitled
to recover its or their reasonable attorneys fees and court costs from the other
party or parties.

            11.14.  OPPORTUNITY TO HIRE COUNSEL;  ROLE OF KIRKPATRICK & LOCKHART
LLP. Each Shareholder  acknowledges  that he has been advised and has been given
an  opportunity  to  hire  counsel  with  respect  to  this  Agreement  and  the
transactions contemplated hereby. Each Shareholder further acknowledges that the
law firm of  Kirkpatrick  & Lockhart  llp has solely  represented  the Parent in
connection with this Agreement and the transactions  contemplated  hereby and no
other person.

            11.15. TIME IS OF THE ESSENCE. It is understood and agreed among the
parties hereto that time is of the essence in this Agreement and this applies to
all terms and conditions contained herein.

            11.16. NO JURY TRIAL. THE PARTIES HEREBY KNOWINGLY,  VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY  LITIGATION  BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION  WITH
THIS  AGREEMENT  AND ANY  DOCUMENT  CONTEMPLATED  TO BE EXECUTED IN  CONJUNCTION
HEREWITH,  OR ANY COURSE OF  CONDUCT,  COURSE OF  DEALING,  STATEMENTS  (WHETHER
VERBAL OR  WRITTEN)  OR  ACTIONS  OF ANY  PARTY.  THIS  PROVISION  IS A MATERIAL
INDUCEMENT FOR THE PARTIES' ACCEPTANCE OF THIS AGREEMENT.



<PAGE>


        IN WITNESS WHEREOF,  the parties have executed this Agreement to be duly
executed  by their duly  authorized  officers as of the day and year first above
written.
                                            PARENT:

                                            EUROPEAN MICRO HOLDINGS, INC.


                                          By:    /s/ Harry Shields
                                          --------------------------------------
                                          Name:         Harry Shields
                                          --------------------------------------
                                          Title: Co-President


                                          MERGER SUB:

                                          AMERICAN MICRO ACQUISITION CORP.


                                          By:    /s/ Harry Shields
                                          --------------------------------------
                                          Name:         Harry Shields
                                          --------------------------------------
                                          Title: Co-President
                                          --------------------------------------


                                          SHAREHOLDERS:


                                                 /s/ John B. Gallagher
                                          --------------------------------------
                                          John B. Gallagher


                                                 /s/ John P. Gallagher, Trustee
                                          --------------------------------------
                                          John P. Gallagher, Trustee,
                                          John P. Gallagher Declaration of Trust
                                          dated 9/24/98


                                          THE COMPANY:

                                          AMERICAN  SURGICAL  SUPPLY CORP. OF
                                          FLORIDA   D/B/A    AMERICAN   MICRO
                                          COMPUTER CENTER

                                          By:    /s/ John B. Gallagher
                                          --------------------------------------
                                          Name:  John B. Gallagher
                                          --------------------------------------
                                          Title: President
                                          --------------------------------------