<PAGE>
 
                                                                  EXHIBIT 10.1
                                                                  ------------
                                        
                        AGREEMENT AND MUTUAL RELEASE
                                        

 This Agreement and Mutual Release ("Agreement") is made by and between  CBT
 GROUP PUBLIC LIMITED COMPANY (together with its subsidiaries, the "Company"),
 and Jeffrey N. Newton ("Newton").

 WHEREAS, Newton has provided services to the Company since April of 1992, and
 has served as Vice President of Business Development to the Company since March
 of 1997;

 WHEREAS, Newton desires to terminate employment with the Company for personal
 reasons, and Newton and the Company desire to release each other from any
 claims arising from or related to Newton's employment with the Company;

 WHEREAS, the Company and Newton have entered into a Confidential Information
 and Invention Assignment Agreement ( the "Confidentiality  Agreement");


 NOW THEREFORE, in consideration of the mutual promises made herein, the Company
 and Newton (collectively referred to as "the Parties") hereby agree as follows:

 1.  RESIGNATION AND TERMINATION OF EMPLOYMENT.  Newton will resign from his
     -----------------------------------------                              
     position as Vice President, Business Development and terminate employment
     with the Company on June 30, 1998 (the "Resignation Date"). All
     compensation due Newton, including salary, commissions and quarterly
     bonus, will be payable within thirty (30) days of June 30, 1998. Newton
     will submit all claims for reimbursement of employee expenses within the
     same time frame.

 2.  CONSIDERATION.     Newton agrees to remain available as a consultant
     --------------                                                      
     through October 31, 1999 (the "Consulting Period"). Newton agrees to
     execute a consulting agreement in the form of Exhibit A (the "Consulting
     Agreement") on the commencement of the Consulting Period. During the
     Consulting Period and upon reasonable notice, Newton shall make himself
     available for consultation and/or participation in conferences, up to a
     maximum of thirty (30) hours per month. The Company will pay Newton a lump
     sum of $15,000 by July 31, 1998 in consideration of his availability
     through the Consulting Period and, in addition, the Company will pay Newton
     an hourly rate of $100 for a minimum of ten (10) hours per month, for a
     minimum monthly payment of $1,000. Newton will also continue to vest in
     Company options during the Consulting Period as provided in paragraph 4
     below.

 3.  RELATIONSHIP OF THE PARTIES DURING THE CONSULTING PERIOD.   It is the
     --------------------------------------------------------             
     express intention of the parties that Newton shall be an independent
     contractor during the Consulting Period, and Newton acknowledges and agrees
     that he will receive no Company-sponsored benefits either as a Consultant
     or an employee after June 30, 1998, except those benefits mandated by 
     state or federal law upon termination of employment.

 4.  STOCK OPTIONS.   Newton shall be allowed to continue to vest in options
     -------------                                                          
     ("Options") to purchase American Depository Shares (ADSs") representing
     the ordinary shares of the Company subject to share option agreements
     dated July 8, 1994, April 13, 1995, January 16, 1996, April 12, 1996,
     March 18, 1997 and January 13, 1998 (the "Option Agreements") through the
     Consulting Period, which shall terminate on October 31, 1999. As of June
     30, 1998, Newton will have fully vested in 23,339 

                                       1
<PAGE>
 
     ADSs of the Company subject to the Options. To the extent Newton's
     Options have not vested as of October 31, 1999, such Options shall
     terminate, and all vested Options which have not been exercised at that
     date shall also terminate as of the end of the Consulting Period, which
     shall terminate on October 31, 1999. During the Consulting Period, Newton
     shall have no right to additional option grants by the Company.

 5.  CONFIDENTIAL INFORMATION.  Newton shall continue to maintain the
     ------------------------                                        
     confidentiality of all confidential and proprietary information of the
     Company and shall continue to comply with the terms and conditions of the
     Confidentiality Agreement between Newton and the Company.  Newton shall
     return all Company property and confidential and proprietary information in
     his possession to the Company within five business days from the
     termination of the Consulting Period, or upon the Company's earlier
     request. The Parties hereto each agree to use their best efforts to
     maintain in confidence the existence of this Agreement, the contents and
     terms of this Agreement, and the consideration for this Agreement, except
     to the extent disclosure is required by law or administrative regulation.

 6.  RELEASE OF CLAIMS.  Newton agrees that the foregoing consideration
     -----------------                                                 
     represents settlement in full of all outstanding obligations owed to
     Newton by the Company. Newton and the Company, on behalf of themselves,
     and their respective heirs, family members, executors, officers,
     directors, employees, investors, shareholders, administrators,
     affiliates, divisions, subsidiaries, predecessor and successor
     corporations, and assigns, hereby fully and forever release each other
     and their respective heirs, family members, executors, officers,
     directors, employees, investors, shareholders, administrators,
     affiliates, divisions, subsidiaries, predecessor and successor
     corporations, and assigns, from, and agree not to sue concerning, any
     claim, duty, obligation or cause of action relating to any matters of any
     kind, whether presently known or unknown, suspected or unsuspected, that
     any of them may possess arising from any omissions, acts or facts that
     have occurred up until and including the Effective Date (as hereafter
     defined) of this agreement including, without limitation,

     (a)  any and all claims relating to or arising from Newton's employment and
          the termination of that employment  with the Company;

     (b)  any and all claims relating to, or arising from, Newton's right to
          purchase, or actual purchase of shares of stock of the Company,
          including, without limitation, any claims for fraud,
          misrepresentation, breach of fiduciary duty, breach of duty under
          applicable state corporate law, and securities fraud under any state
          or federal law;

     (c)  any and all claims for wrongful discharge of employment; breach of
          contract, both express and implied; breach of a covenant of good
          faith and fair dealing, both express and implied; negligent or
          intentional infliction of emotional distress; negligent or
          intentional misrepresentation; negligent or intentional interference
          with contract or prospective economic advantage; defamation;
          negligence; personal injury; assault; battery; invasion of privacy;
          false imprisonment; conversion;

     (d)  any and all claims for violation of any federal, state or municipal
          statute, including, but not limited to, Title VII of the Civil
          Rights Act of 1964, the Civil Rights Act of 1991,the Age
          Discrimination in Employment Act of 1967, the Americans with
          Disabilities Act of 1990, the Fair Labor Standards Act, the
          California Fair Employment and Housing Act, Labor Code Section 201,
          et seq.;

     (e)  any and all claims arising out of any other laws and regulations and
          regulations

                                       2
<PAGE>
 
          relating to employment or employment discrimination; and

     (f)  any and all claims for attorneys' fees and/or costs.

     The Company and Newton agree that the release set forth in this section
     shall be and remain in effect in all respects as a complete general release
     as to the matters released. This release does not extend to any
     obligations incurred under this Agreement.

 7.  ACKNOWLEDGMENT OF WAIVER OF CLAIMS UNDER ADEA.  Newton acknowledges that he
     ---------------------------------------------                              
     is waiving and releasing any rights he may have under the Age
     Discrimination in Employment Act of 1967 ("ADEA") and that this waiver
     and release is knowing and voluntary. Newton and the Company agree that
     this waiver and release does not apply to any rights or claims that may
     arise under ADEA after the Effective Date of this Agreement. Newton
     acknowledges that the consideration given for this waiver and release
     Agreement is in addition to anything of value to which Newton was already
     entitled. Newton further acknowledges that he has been advised by this
     writing that (a) he should consult with an attorney prior to executing
     this Agreement; (b) he has at least twenty-one (21) days within which to
     consider this Agreement; (c) he has at least seven (7) days following the
     execution of this Agreement by the parties to revoke the Agreement; and
     (d) this Agreement shall not be effective until the revocation period has
     expired.

 8.  CIVIL CODE SECTION 1542.  The Parties represent that they are not aware of
     -----------------------                                                   
     any claim by either of them other than the claims that are released by this
     Agreement.  Newton and the Company acknowledge that they have been advised
     by legal counsel and are familiar with the provisions of California Civil
     Code Section 1542, which provides as follows:

     A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH
     THE  CREDITOR  DOES  NOT  KNOW OR SUSPECT TO EXIST IN
     HIS  FAVOR  AT  THE  TIME  OF  EXECUTING   THE   RELEASE,
     WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED
     HIS SETTLEMENT WITH THE DEBTOR.

     Newton and the Company, being aware of said code section, agree to
     expressly waive any rights they may have thereunder, as well as under any
     other statute or common law principles of similar effect.

 9.  NON-COMPETITION.  Newton agrees that, during the Consulting Period and for
     ---------------
     a period of two years after the termination of the Consulting Period, he
     will not, directly or indirectly, own, manage, operate, join, control,
     participate in or finance the ownership, management, operation or control
     of, or be connected in any manner with a company whose primary business is
     to provide interactive educational software for information technology
     professionals, including but not limited to the following: NETG, Gartner
     Group, WBT, Learning Tree, Harcourt, Mastering Computers, Global Knowledge
     Network, Ziff Davis University, Data Tech, Knowledge Universe, Digital
     Think, Knowledge Soft and any subsidiary or division of a development
     partner of the Company (including but not limited to IBM Education, Oracle
     Education, Lotus Education, Cisco Education and Novell Education). Newton
     may accept other non-competitive employment while retaining consultancy
     with the Company as long as he is able to meet the maximum 30 hour
     commitment, if required, as specified above in Paragraph 2.

 10. NON-SOLICITATION.   Newton agrees that for a period of two (2) years,
     ----------------                                                     
     during the Consulting Period and after the termination of the Consulting
     Period, he will not either directly or indirectly solicit, induce,

                                       3
<PAGE>
 
     recruit or encourage any of the Company's employees to leave their
     employment, or take away such employees, or attempt to solicit, induce,
     recruit, encourage or take away employees of the Company, either for
     himself or for any other person or entity; provided, however, that the
     employment of employees of the Company by any employer, person, firm or
     company with which I am connected or associated shall not in itself
     breach or be deemed to be a breach of this clause.


 11. ARBITRATION.  The parties agree that any and all disputes arising out of
     -----------                                                            
     the terms of this Agreement, their interpretation, and any of the matters
     herein released, shall be subject to binding arbitration in Santa Clara
     County before the American Arbitration Association under its California
     Employment Dispute Resolution Rules, or by a judge to be mutually agreed
     upon. The Parties agree that the prevailing party in any arbitration
     shall be entitled to injunctive relief in any court of competent
     jurisdiction to enforce the arbitration award. The Parties agree that the
     prevailing party in any arbitration shall be awarded its reasonable
     attorney's fees and costs. NEWTON HAS READ AND UNDERSTANDS THIS
     ARBITRATION PROVISION. NEWTON UNDERSTANDS THAT BY SIGNING THIS AGREEMENT,
     HE AGREES TO SUBMIT ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN
     CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY,
     CONSTRUCTION PERFORMANCE, BREACH OR TERMINATION THEREOF, TO BINDING
     ARBITRATION, EXCEPT AS PROVIDED IN THE LAST SENTENCE OF THIS SECTION, AND
     THAT THIS ARBITRATION PROVISION CONSTITUTES A WAIVER OF NEWTON'S RIGHT TO
     A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO
     ALL ASPECTS OF THE RELATIONSHIP BETWEEN THE PARTIES. The parties may
     apply to any court of competent jurisdiction for a temporary restraining
     order, preliminary injunction, or other interim or conservatory relief,
     as necessary without breach of this arbitration agreement and without
     abridgement of the powers of the arbitrator.


 12. NON-DISPARAGEMENT.  Each party agrees to refrain from any disparagement,
     -----------------                                                       
     defamation, slander of the other, or tortious interference with the
     contracts and relationships of the other. In addition, Newton
     specifically also agrees not to disparage or to publicly express
     disapproval of Company's employees, products or services. The parties
     each acknowledge and agree that it would be impossible and inadequate to
     measure actual damages if either party breaches its obligations under
     this paragraph, and therefore the parties agree that $150,000 shall be
     payable, as liquidated damages and not as a penalty, by the breaching
     party to the non-breaching party. For purposes of this paragraph, the
     "Company" shall be deemed to refer solely to directors and officers of
     the Company. The parties agree that the damages specified are a good
     faith estimate of the actual amount of damages which would be sustained
     and that such damages are reasonable under the circumstances.

 13. COSTS.  The parties shall each bear his or its own costs, expert fees,
     -----                                                                
     attorneys' fees and other fees incurred in connection with this Agreement.

 14. NO REPRESENTATIONS.  Each party represents that it has had the opportunity
     ------------------                                                        
     to consult with an attorney, and has carefully read and understands the
     scope and effect of the provisions of this Agreement.  Neither party has
     relied upon any representations or statements made by the other party
     hereto which are not specifically set forth in this Agreement.

 15. SEVERABILITY.  In the event that any provision hereof becomes or is
     -------------                                                      
     declared by a court of competent jurisdiction to be illegal,
     unenforceable or void, this Agreement shall continue in full force and
     effect without said provision.

                                       4
<PAGE>
 
 16. ENTIRE AGREEMENT.  This Agreement, the Option Agreements, the Consulting
     ----------------                                                        
     Agreement and the Confidentiality Agreement,  represent the entire
     agreement and understanding between the Company and Newton concerning
     Newton's separation from the Company, and supersede and replace any and all
     prior agreements and understandings concerning Newton's relationship with
     the Company and his compensation by the Company.

 17. NO ORAL MODIFICATION.  This Agreement may only be amended in writing signed
     --------------------                                                       
     by Newton and the Chief Executive Officer of the Company.

 18. GOVERNING LAW. .  This Agreement shall be governed by the internal laws of
     -------------                                                             
     the State of California, without regard to conflict of laws principles.

 19. EFFECTIVE DATE.  This Agreement is effective seven days after it has been
     --------------                                                           
     signed by both Parties ("the Effective Date").

 20. COUNTERPARTS.  This Agreement may be executed in counterparts, and each
     ------------                                                           
     counterpart shall have the same force and effect as an original and shall
     constitute an effective, binding agreement on the part of each of the
     undersigned.

 21. VOLUNTARY EXECUTION OF AGREEMENT.  This Agreement is executed voluntarily
     --------------------------------                                         
     and without any duress or undue influence on the part or behalf of the
     Parties hereto, with the full intent of releasing all claims.  The Parties
     acknowledge that:

     (a)   They have read this Agreement;

     (b)   They have been represented in the preparation, negotiation, and
           execution of this Agreement by legal counsel of their own choice or
           that they have voluntarily declined to seek such counsel;

     (c)   They understand the terms and consequences of this Agreement and of
           the releases it contains;

     (d)   They are fully aware of the legal and binding effect of this 
           Agreement.

 IN WITNESS WHEREOF, the Parties have executed this Agreement on the respective
 dates set forth below.


                                         CBT GROUP, PLC


 Dated: June 3, 1998                      By: /s/ James J. Buckley
                                              --------------------
                                              (Signature)

                                          Title: Chief Executive and President
                                                 -----------------------------
 

                                       5
<PAGE>
 
                                         JEFFREY N. NEWTON, an individual


 Dated: June 3, 1998                   /s/ Jeffrey N. Newton
                                       ---------------------
                                                      (Signature)

                                       6
<PAGE>
 
                                 ADDENDUM A
                                 ----------


                            CONSULTING AGREEMENT
                            --------------------


     This Consulting Agreement ("Agreement") is made and entered into as of the
30th day of  June, 1998 by and between CBT Systems USA Ltd. (the "Company"), and
Jeffrey N. Newton ("Consultant").  The Company desires to retain Consultant as
an independent contractor to perform consulting services for the Company and
Consultant is willing to perform such services, on terms set forth more fully
below.  In consideration of the mutual promises contained herein, the parties
agree as follows:


     1.  SERVICES AND COMPENSATION
         -------------------------

         (a)  Services.  Consultant agrees to perform for the Company the
              --------                                                   
services ("Services") described in Addendum A, attached hereto.

         (b)  Compensation.
              ------------ 

              (i)   Company shall pay Consultant $100 per hour, for a minimum of
ten (10) hours per month.     A monthly payment of $1,000 will be payable by 
the end of every calendar month, beginning August 31, 1998.

              (ii)  The Company shall reimburse Consultant for all reasonable 
travel and living expenses incurred by Consultant in performing Services 
pursuant to this Agreement, provided Consultant receives written consent from 
an authorized agent of the Company prior to incurring such expenses.

              (iii) Consultant shall submit all statements for services and
expenses in a form prescribed by the Company every two weeks and such statement
shall be approved by the contact person listed on Addendum A or other designated
agent of the Company.

     2.  CONFIDENTIALITY
         ---------------

         (a) Definition.  "Confidential Information" means any Company
             ----------                                               
proprietary information, technical data, trade secrets or know-how, including,
but not limited to, research, product plans, products, services, customers,
customer lists, markets, software, developments, inventions, processes,
formulas, technology, designs, drawings, engineering, hardware configuration
information, marketing, finances or other business information disclosed by the
Company either directly or indirectly in writing, orally or by drawings or
inspection of parts or equipment.

                                       7
<PAGE>
 
         (b) Non-Use and Non-Disclosure.  Consultant will not, during or
             --------------------------                                 
subsequent to the term of this Agreement, use the Company's Confidential
Information for any purpose whatsoever other than the performance of the
Services on behalf of the Company or disclose the Company's Confidential
Information to any third party.  It is understood that said Confidential
Information shall remain the sole property of the Company.  Consultant further
agrees to take all reasonable precautions to prevent any unauthorized disclosure
of such Confidential Information including, but not limited to, having each
employee of Consultant, if any, with access to any Confidential Information,
execute a nondisclosure agreement containing provisions in the Company's favor
identical to Sections 2, 3 and 4 of this Agreement.  Confidential Information
does not include information which (i) is known to Consultant at the time of
disclosure to Consultant by the Company as evidenced by written records of
Consultant, (ii) has become publicly known and made generally available through
no wrongful act of Consultant, or (iii) has been rightfully received by
Consultant from a third party who is authorized to make such disclosure. The
parties shall agree on any disclosure of the existence or the contents of this
Agreement.  Consultant agrees not to make any disclosure of the existence or
contents of this Agreement which is inconsistent with the prior public
disclosure of the Company.

         (c)  Former Employer's Confidential Information.  Consultant agrees
              ------------------------------------------                    
that Consultant will not, during the term of this Agreement, improperly use or
disclose any proprietary information or trade secrets of any former or current
employer or other person or entity with which Consultant has an agreement or
duty to keep in confidence information acquired by Consultant, if any, and that
Consultant will not bring onto the premises of the Company any unpublished
document or proprietary information belonging to such employer, person or entity
unless consented to in writing by such employer, person or entity.  Consultant
will indemnify the Company and hold it harmless from and against all claims,
liabilities, damages and expenses, including reasonable attorneys fees and costs
of suit, arising out of or in connection with any violation or claimed violation
of a third party's rights resulting in whole or in part from the Company's use
of the work product of Consultant under this Agreement.

         (d)  Third Party Confidential Information.  Consultant recognizes that
              ------------------------------------                             
the Company has received and in the future will receive from third parties their
confidential or proprietary information subject to a duty on the Company's part
to maintain the confidentiality of such information and to use it only for
certain limited purposes.  Consultant agrees that Consultant owes the Company
and such third parties, during the term of this Agreement and thereafter, a duty
to hold all such confidential or proprietary information in the strictest
confidence and not to disclose it to any person, firm or corporation or to use
it except as necessary in carrying out the Services for the Company consistent
with the Company's agreement with such third party.

         (e)  Return of Materials.  Upon the termination of this Agreement, or
              -------------------                                             
upon Company's earlier request, Consultant will deliver to the Company all of
the Company's property or Confidential Information that Consultant may have in
Consultant's possession or control.

     3.  OWNERSHIP
         ---------

         (a)  Assignment.  Consultant agrees that all copyrightable material,
              ----------                                                     
notes,

                                       8
<PAGE>
 
records, drawings, designs, inventions, improvements, developments,
discoveries and trade secrets (collectively, "Inventions") conceived, made or
discovered by Consultant, solely or in collaboration with others, during the
period of this Agreement and in the course of performing Services or services
as a director of the Company which relate in any manner to the business of the
Company that Consultant may be directed to undertake, investigate or
experiment with, or which Consultant may become associated with in work,
investigation or experimentation in the line of business of Company, are the
sole property of the Company. Consultant further agrees to assign (or cause to
be assigned) and does hereby assign fully to the Company all Inventions and
any copyrights, patents, mask work rights or other intellectual property
rights relating thereto.

         (b)  Further Assurances.  Consultant agrees to assist Company, or its
              ------------------                                              
designee, at the Company's expense, in every proper way to secure the Company's
rights in the Inventions and any copyrights, patents, mask work rights or other
intellectual property rights relating thereto in any and all countries,
including the disclosure to the Company of all pertinent information and data
with respect thereto, the execution of all applications, specifications, oaths,
assignments and all other instruments which the Company shall deem necessary in
order to apply for and obtain such rights and in order to assign and convey to
the Company, its successors, assigns and nominees the sole and exclusive right,
title and interest in and to such Inventions, and any copyrights, patents, mask
work rights or other intellectual property rights relating thereto.  Consultant
further agrees that Consultant's obligation to execute or cause to be executed,
when it is in Consultant's power to do so, any such instrument or papers shall
continue after the termination of this Agreement.

         (c)  Pre-Existing Materials.  Consultant agrees that if in the course
              ----------------------                                          
of performing the Services, Consultant incorporates into any Invention developed
hereunder any invention, improvement, development, concept, discovery or other
proprietary information owned by Consultant or in which Consultant has an
interest, (i) Consultant shall inform Company, in writing before incorporating
such  invention, improvement, development, concept, discovery or other
proprietary information into any Invention; and (ii) the Company is hereby
granted and shall have a nonexclusive, royalty-free, perpetual, irrevocable,
worldwide license to make, have made, modify, use and sell such item as part of
or in connection with such Invention.  Consultant shall not incorporate any
invention, improvement, development, concept, discovery or other proprietary
information owned by any third party into any Invention without Company's prior
written permission.

         (d)  Attorney in Fact.  Consultant agrees that if the Company is unable
              ----------------                                                  
because of Consultant's unavailability, dissolution, mental or physical
incapacity, or for any other reason, to secure Consultant's signature to apply
for or to pursue any application for any United States or foreign patents or
mask work or copyright registrations covering the Inventions assigned to the
Company above, then Consultant hereby irrevocably designates and appoints the
Company and its duly authorized officers and agents as Consultant's agent and
attorney in fact, to act for and in Consultant's behalf and stead to execute and
file any such applications and to do all other lawfully permitted acts to
further the prosecution and issuance of patents, copyright and mask work
registrations thereon with the same legal force and effect as if executed by
Consultant.

     4.  CONFLICTING OBLIGATIONS
         -----------------------

                                       9
<PAGE>
 
         Consultant certifies that Consultant has no outstanding agreement or
obligation that is in conflict with any of the provisions of this Agreement, or
that would preclude Consultant from complying with the provisions hereof, and
further certifies that Consultant will not enter into any such conflicting
agreement during the term of this Agreement.

     5.  TERM AND TERMINATION
         --------------------

         (a)  Term.  This Agreement will commence on the date first written
              ----                                                         
above and will continue until October 31, 1998.

         (b)  Survival.  Upon such termination all rights and duties of the
              --------                                                     
parties toward each other shall cease except:

              (i) that the Company shall be obliged to pay, within thirty (30)
days of the effective date of termination, all amounts owing to Consultant for
Services completed and accepted by the Company prior to the termination date
and related expenses, if any, in accordance with the provisions of Section 1
(Services and Compensation) hereof; and

              (ii) Sections 2 (Confidentiality), 3 (Ownership) and 7
(Independent Contractors) shall survive termination of this Agreement.

     6.  ASSIGNMENT; SUCCESSORS
         ----------------------

         (a)  Assignment.  Neither this Agreement nor any right hereunder or
              ----------                                                    
interest herein may be assigned or transferred by Consultant without the express
written consent of the Company.

         (b)  Company's Successors.  Any successor to the Company (whether
              --------------------                                        
direct or indirect and whether by purchase, lease, merger, consolidation,
liquidation or otherwise) to all or substantially all of the Company's business
and/or assets shall assume the obligations under this Agreement and agree
expressly to perform the obligations under this Agreement in the same manner and
to the same extent as the Company would be required to perform such obligations
in the absence of a succession.  For all purposes under this Agreement, the term
"Company" shall include any successor to the Company's business and assets which
executes and delivers the assumption agreement described in this Section or
which becomes bound by the terms of this Agreement by operation of law.

         (c)  Consultant's Successors.  The terms of this Agreement and all
              -----------------------                                      
rights of the Consultant hereunder shall inure to the benefit of, and be
enforceable by, the Consultant's legal representatives, executors,
administrators, successor, heirs, distributees, devisees or legatees.

     7.  INDEPENDENT CONTRACTOR
         ----------------------


         It is the express intention of the parties that Consultant is an
independent contractor.  

                                       10
<PAGE>
 
Nothing in this Agreement shall in any way be construed to constitute
Consultant as an agent, employee or representative of the Company, but
Consultant shall perform the Services hereunder as an independent contractor.
Consultant agrees to furnish (or reimburse the Company for) all tools and
materials necessary to accomplish this contract, and shall incur all expenses
associated with performance, except as expressly provided on Addendum A of
this Agreement. Consultant acknowledges and agrees that Consultant is
obligated to report as income all compensation received by Consultant pursuant
to this Agreement, and Consultant agrees to and acknowledges the obligation to
pay all self-employment and other taxes thereon. Consultant further agrees to
indemnify and hold harmless the Company and its directors, officers, and
employees from and against all taxes, losses, damages, liabilities, costs and
expenses, including attorney's fees and other legal expenses, arising directly
or indirectly from (i) any negligent, reckless or intentionally wrongful act
of Consultant or Consultant's assistants, employees or agents, (ii) a
determination by a court or agency that the Consultant is not an independent
contractor, or (iii) any breach by the Consultant or Consultant's assistants,
employees or agents of any of the covenants contained in this Agreement.

     8.  BENEFITS
         --------

         Except as otherwise provided herein, Consultant acknowledges and
agrees and it is the intent of the parties hereto that Consultant receive no
Company-sponsored benefits from the Company either as a Consultant or employee.
Such benefits include, but are not limited to, paid vacation, sick leave,
medical insurance, and 401(k) participation.  If Consultant is reclassified by a
state or federal agency or court as an employee, Consultant will become a
reclassified employee and will receive no benefits except those mandated by
state or federal law, even if by the terms of the Company's benefit plans in
effect at the time of such reclassification Consultant would otherwise be
eligible for such benefits.

     9.  ARBITRATION AND EQUITABLE RELIEF
         --------------------------------

         (a)  Disputes.  Except as provided in Section 9(d) below, the Company
              --------                                                        
and Consultant agree that any dispute or controversy arising out of, relating to
or in connection with the interpretation, validity, construction, performance,
breach or termination of this Agreement shall be settled by binding arbitration
to be held in San Francisco County, California, in accordance with the
Commercial Arbitration Rules, supplemented by the Supplemental Procedures for
Large Complex Disputes, of the American Arbitration Association as then in
effect (the "Rules").  The arbitrator may grant injunctions or other relief in
such dispute or controversy.  The decision of the arbitrator shall be final,
conclusive and binding on the parties to the arbitration.  Judgment may be
entered on the arbitrator's decision in any court of competent jurisdiction.

         (b)  Consent to Personal Jurisdiction.  The arbitrator(s) shall apply
              --------------------------------                                
California law to the merits of any dispute or claim, without reference to
conflicts of law rules.  Consultant hereby consents to the personal jurisdiction
of the state and federal courts located in California for any action or
proceeding arising from or relating to this Agreement or relating to any
arbitration in which the parties are participants.

                                       11
<PAGE>
 
         (c)  Costs.  The Company and Consultant shall each pay one-half of the
              -----                                                            
costs and expenses of such arbitration, and each shall separately pay its
counsel fees and expenses unless otherwise required by law.

         (d)  Equitable Relief.  The parties may apply to any court of competent
              ----------------                                                  
jurisdiction for a temporary restraining order, preliminary injunction, or other
interim or conservatory relief, as necessary, without breach of this arbitration
agreement and without abridgment of the powers of the arbitrator.

         (e)  Acknowledgment.  CONSULTANT HAS READ AND UNDERSTANDS SECTION 9,
              --------------                                                 
WHICH DISCUSSES ARBITRATION.  CONSULTANT UNDERSTANDS THAT BY SIGNING THIS
AGREEMENT, CONSULTANT AGREES TO SUBMIT ANY CLAIMS ARISING OUT OF, RELATING TO,
OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY,
CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION THEREOF, TO BINDING
ARBITRATION, EXCEPT AS PROVIDED IN SECTION 9 (d), AND THAT THIS ARBITRATION
CLAUSE CONSTITUTES A WAIVER OF CONSULTANT'S RIGHT TO A JURY TRIAL AND RELATES TO
THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE RELATIONSHIP
BETWEEN THE PARTIES.

     10. GOVERNING LAW
         -------------

         This Agreement shall be governed by the internal substantive laws, but
not the choice of law rules, of the State of California.

     11. ENTIRE AGREEMENT
         ----------------

         This Agreement, the Stock Option Agreements (as defined below) and the
Agreement and Mutual Release, dated June 3, 1998 contain the entire
agreement of the parties and supersede any and all prior agreements between
them, whether written or oral, with respect to the subject matter hereof.
Stock Option Agreements mean the Share Option Agreements dated: (i) July 8,
1994,  (ii)  April 13, 1995, (iii)   January 16, 1996, (iv) April 12, 1996, (v)
March 18, 1997, and (vi) January 13, 1998.      No waiver, alteration, or
modification of any of the provisions of this Agreement shall be binding unless
in writing and signed by duly authorized representatives of the parties hereto.
The unvested portion of all stock options held by Consultant under the Stock
Option Agreements at the date of Consultant's termination as an employee of the
Company (the "Unvested Options") shall continue to vest during the term of this
Agreement according to the vesting schedule set forth in each Unvested Option's
respective Option Agreement.

     12. ATTORNEY'S FEES
         ---------------

         In any court action at law or equity which is brought by one of the
parties to enforce or interpret the provisions of this Agreement, the prevailing
party will be entitled to reasonable attorney's fees, in addition to any other
relief to which that party may be entitled.

                                       12
<PAGE>
 
     13. SEVERABILITY
         ------------

         The invalidity or unenforceability of any provision of this Agreement,
or any terms thereof, shall not affect the validity of this Agreement as a
whole, which shall at all times remain in full force and effect.



     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.



                                   CONSULTANT



                                   By:/s/ Jeffrey N. Newton
                                       ---------------------

                                   Title:Consultant
                                         ----------

                                   Address: 3793 Smallwood Court             
                                            --------------------            
                                            Pleasanton, CA 94566
                                            --------------------


                                   CBT SYSTEMS USA LTD.



                                   By:/s/ James J. Buckley
                                      --------------------
        
                                   Title:Chief Executive and President
                                         -----------------------------
                                   Address: 1005 Hamilton Court, Menlo Park, CA
                                            -----------------------------------
                                            94025
                                            -----

                                       13
<PAGE>
 
                                 ADDENDUM A
                                 ----------

                          SERVICES AND COMPENSATION
                          -------------------------



     1.     Contact.      Consultant's principal Company contact:
            -------                                          

            Name:         James Buckley

  
            Title:        Chief Executive Officer



     2.     Services.     Consultant will render to the Company services on
            --------
            projects as identified by James Buckley, the Chief Executive
            Officer or his designee. Such projects are initially contemplated
            to involve the transition of another Company officer or officers
            into Consultant's former responsibilities with the Company.

                                       14