<PAGE>   1
                                                                   EXHIBIT 10.12


                              DATED JANUARY 1, 1999
                              ---------------------


                           (1) LCC INTERNATIONAL INC.


                                       AND


                                 (2) PETER ZAUGG





                            -----------------------
                                SERVICE AGREEMENT
                            -----------------------




                                     WARNER
                                    CRANSTON
                                   SOLICITORS


                                 Pickfords Wharf
                                  Clink Street
                                     London
                                     SE1 9DG


                               Tel: 0171 403 2900
                               Fax: 0171 403 4221


<PAGE>   2
<TABLE>
<CAPTION>
                                      INDEX


<S>                                                                                         <C>
1.      DEFINITIONS AND INTERPRETATION.......................................................1

2.      APPOINTMENT..........................................................................3

3.      TERM.................................................................................3

4.      OBLIGATION TO PROVIDE WORK...........................................................3

5.      HOURS OF WORK........................................................................4

6.      POWERS AND DUTIES....................................................................5

7.      PLACE OF WORK AND TRAVEL.............................................................5

8.      SALARY AND EXPENSES..................................................................5

9.      EXPENSES.............................................................................8

10.     BENEFITS.............................................................................9

11.     HOLIDAYS.............................................................................9

12.     INCAPACITY...........................................................................9

13.     CONFIDENTIALITY.....................................................................10

14.     DATA PROCESSING.....................................................................12

15.     RESTRICTIONS DURING EMPLOYMENT......................................................13

16.     RESTRICTIONS AFTER EMPLOYMENT.......................................................13

17.     TERMINATION.........................................................................16

18.     RETURN OF COMPANY PROPERTY..........................................................17

19.     INVENTIONS AND IMPROVEMENTS.........................................................17

20.     GRIEVANCE AND DISCIPLINARY PROCEDURE................................................18

21.     RECONSTRUCTION OR AMALGAMATION......................................................19

22.     GENERAL.............................................................................19

23.     NOTICES.............................................................................19

24.     OTHER AGREEMENTS....................................................................20

25.     GOVERNING LAW.......................................................................20
</TABLE>






<PAGE>   3

THIS SERVICE AGREEMENT is effective from 1st day of January 1999

PARTIES:

(1)     LCC UNITED KINGDOM, LIMITED a company registered in England under number
        3072423 whose registered office is at 43 Crawford Street, London (the
        "Company"); and

(2)     PETER ZAUGG of Moscher 24, 8126 Zumiokn (the "Executive").

IT IS AGREED as follows:


1.      DEFINITIONS AND INTERPRETATION

        In this Agreement:

        1.1    unless the context otherwise requires:

               the "Act"                  means the Employment Rights Act
                                          1996;

               "Associated Company"       means a company which is from
                                          time to time a subsidiary or a holding
                                          company of the Company or a subsidiary
                                          other than the Company of any such
                                          holding company where "subsidiary" and
                                          "holding company" have the meanings
                                          given to them by section 736 of the
                                          Companies Act 1985;

               the "Auditors"             means the auditors of the Company from
                                          time to time;

               the "Board"                means directors of the Company present
                                          at a meeting of them or of a committee
                                          of them duly convened constituted and
                                          held;

               "Competing Business"       means any business, person or entity
                                          that: (a) provides radio frequency
                                          engineering, fixed network
                                          engineering, system deployment
                                          (including site acquisition,
                                          construction management, program
                                          management or similar services),
                                          benchmarking, wireless network
                                          outsourcing, or similar services to
                                          the wireless telecommunications
                                          industry, or (b) is engaged in the
                                          business of owning, acquiring (by
                                          sale/leaseback or otherwise),
                                          constructing (on a build-to-suit
                                          basis), leasing or managing
<PAGE>   4

                                          telecommunications towers or cell
                                          sites;

               "EMEA"                     means Europe, Middle-East and Africa;

               "Restricted Business"      means the part or parts of the
                                          Company's and/or relevant Associated
                                          Company's business in which the
                                          Executive was involved to a material
                                          extent during the last 12 months of
                                          his employment;

               "Restricted Client"        means any person, firm, company,
                                          business entity or other organisation
                                          which during the last 12 months of the
                                          Executive's employment was a client or
                                          customer of the Restricted Business
                                          and with which during such period the
                                          Executive had significant personal
                                          contact or dealings;

               "Restricted Employee"      means senior officer, employee, or
                                          consultant of the Company with whom,
                                          during the last 12 months of his
                                          employment, the Executive had
                                          significant contact or dealings in the
                                          course of his employment;

               "Restricted Supplier"      means any person, firm, company,
                                          business entity or other organisation
                                          which during the last 12 months of his
                                          employment was a supplier to the
                                          Restricted Business and with which
                                          during such period the Executive had
                                          significant personal contact or
                                          dealings;

               the "Regulations"          means the Working Time Regulations
                                          1998.
<PAGE>   5

               1.2      References to any statutes or statutory provisions
                        include those statutes or statutory provisions as
                        amended, extended, consolidated, re-enacted or replaced
                        from time to time and any orders, regulations,
                        instruments or other subordinate legislation made
                        thereunder;

               1.3      unless otherwise specified, words importing the singular
                        include the plural, words importing any gender include
                        every gender and words importing persons include bodies
                        corporate and unincorporate; and (in each case) vice
                        versa;

               1.4      references to clauses and other provisions are
                        references to clauses and other provisions of this
                        Agreement;

               1.5      the clause headings shall not affect interpretation.


2.      APPOINTMENT

        The Company hereby agrees to employ the Executive and the Executive
        agrees to serve the Company as Senior Vice President - EMEA. The
        Executive is expected to carry out such duties as may from time to time
        reasonably be allocated to him. The Company also reserves the right to
        amend the Executive's position to take into account the changing needs
        of the business and his role within it.


3.      TERM

               3.1      Subject always to clause 17, either party may terminate
                        the employment by giving not less than 6 month's prior
                        written notice to the other.

               3.2      For the purposes of the Act the date of commencement of
                        the Executive's continuous employment shall be 1 January
                        1999.

               3.3      The Company reserves the right to terminate the
                        employment forthwith and pay the Executive in lieu of
                        notice rather than making the Executive serve any period
                        of notice otherwise due under clause 3.1. In this event
                        the Executive shall be paid in accordance with clause
                        17.2.


4.      OBLIGATION TO PROVIDE WORK

        4.1    The Company may at any time, including where either party gives
               notice to terminate this employment or otherwise purports to
               terminate it, or for the purposes of investigating any
               disciplinary matter, require the Executive not to attend for work
               and/or not to undertake all or any duties for such period as the
               Company may specify (the "Leave Period").

        4.2    During the Leave Period:
<PAGE>   6

               4.2.1    the Company shall not be obliged to provide the
                        Executive with any work to do, nor to vest in or assign
                        to the Executive any powers or duties. The Company may
                        however, at its absolute discretion, require the
                        Executive to perform such duties and provide such
                        assistance to the Company as it may specify;

               4.2.2    the Company may exclude the Executive from all or any
                        part(s) of its place(s) of business from time to time
                        and/or require the Executive to remain at home;

               4.2.3    the Executive shall remain an employee of the Company
                        bound by the terms and conditions of this Agreement
                        (other than his obligation to perform work for the
                        Company unless specifically required by the Company to
                        do so). In particular (but without limitation) the
                        Executive shall, during the Leave Period, remain bound
                        by his obligations of loyalty and good faith, of
                        exclusivity of service and of confidentiality; and

               4.2.4    the Company shall continue to pay the Executive's salary
                        and provide any other benefit to which the Executive is
                        contractually entitled (provided that it may, in its
                        absolute discretion, replace any such benefit with a
                        cash equivalent sum).

        4.3    The Leave Period shall not, in any event, exceed 6 months.

        4.4    It is hereby agreed that the exercise by the Company of any of
               its rights under this clause shall not constitute a breach of
               this Agreement and nor shall the Executive have any claim against
               the Company in respect of any such action.


5.      HOURS OF WORK

        5.1    The Executive's normal hours of work shall be from 8.30 a.m. to
               5.00 p.m. Monday to Friday. The Executive shall also be required
               to work such additional hours outside these hours as may be
               necessary for the proper performance of his duties. This may
               include weekends or Bank or Public or statutory holidays. The
               Executive will not be entitled to any additional pay, or time off
               in lieu, for additional hours worked.

        5.2    In order properly to perform his duties, the Executive's working
               hours may exceed the working time limit of 48 hours per week, as
               provided by the Regulations. The Executive agrees to opt out of
               the weekly working time limit which shall therefore not apply to
               him. Provided always that the Executive is not covered by
               Regulation 20 of the Regulations the Executive may opt back
<PAGE>   7

               into the application of the weekly working time limit on giving
               the Company 3 months' prior notice in writing.


6.      POWERS AND DUTIES

        During the continuance of his employment hereunder the Executive shall:

        6.1    unless prevented by ill health or other unavoidable cause devote
               the whole of his time attention and abilities to carrying out his
               duties;

        6.2    exercise such powers and perform such duties in relation to the
               business of the Company which are compatible with his status and
               as may from time to time reasonably be vested in or assigned to
               him by the Company;

        6.3    comply with all reasonable directions from time to time given to
               him by the Company and with all rules and regulations from time
               to time laid down by the Company concerning its employees which
               are consistent with this Agreement;

        6.4    carry out his duties in a proper and efficient manner and use his
               best endeavors to promote and maintain the interests and
               reputation of the Company; and

        6.5    at all times promptly give to the Company (in writing if so
               requested) all such information and explanations as the Company
               may require in connection with his employment hereunder or with
               the business of the Company.


7.      PLACE OF WORK AND TRAVEL

        7.1    Prior to receipt of the appropriate work permits enabling the
               Executive to work in the United Kingdom, the Executive shall
               normally work in Zurich. Following receipt of the appropriate
               work permits the Executive shall normally work at the Head Office
               for EMEA in the United Kingdom. However, the Executive shall work
               at such location as the Company shall reasonably require from
               time to time.

        7.2    The Executive shall travel to such places (whether within or
               outside the United Kingdom) and in such manner and on such
               occasions as the Company may from time to time reasonably
               require.


8.      SALARY AND EXPENSES

        8.1    As remuneration for his services during his employment hereunder
               the Company shall pay to the Executive a salary at the rate of
               SFR300,000 (three hundred thousand Swiss Francs) per annum less
               applicable Tax, National Insurance and any other deductions which
               the Company may lawfully make. Such salary is payable in monthly
               installments in arrears (normally on or around
<PAGE>   8

               the last day of each month) to a bank account designated by the
               Executive. Such bank account may be in the United Kingdom or
               Switzerland only.

        8.2    The Company shall be entitled at any time and from time to time
               to recover and retain all sums from time to time owed to the
               Company or any Associated Company by the Executive, howsoever
               arising. Such sum(s) may be recovered by:

               8.2.1    deducting it from any sum(s) from time to time payable
                        to the Executive by the Company (including
                        remuneration); and/or

               8.2.2    requiring the Executive to repay the relevant amount to
                        the Company (or the balance remaining outstanding
                        following such deduction(s) under 8.2.1 above) as the
                        Company thinks fit whether immediately or on terms
                        otherwise acceptable to the Company.

        8.3    In addition to the Executive's basic annual salary, the Company
               shall pay to the Executive:

               8.3.1    a sign on bonus of US$50,000 (the "Sign On Bonus")
                        payable in three installments with US$25,000 by 31 May
                        1999, and US$12,500 due on each of 1 July 1999 and 1
                        October 1999 (the "Payment Dates") provided that the
                        Executive is still in employment on the Payment Dates
                        and has not given the Company nor received from the
                        Company notice to terminate his employment; and

               8.3.2    an annual achievement bonus of approximately 50% of
                        Executive's base salary based on the Company and/or
                        Executive's achieving mutually acceptable annual
                        performance targets (which the parties shall negotiate
                        in good faith prior to the payment of such bonus), which
                        shall be payable on or around 31 January of each year
                        (for the prior year) commencing 31 January 2000 (the
                        "Achievement Bonus") provided that the Executive is
                        still in employment on the Achievement Bonus payment
                        date and has not given to the Company notice to
                        terminate his employment.

        8.4    The Achievement Bonus target for 1999 is US$100,000 ("Bonus
               Target") based on the targets outlined in Section 8.5 below.

        8.5    The Bonus Target is dependent on the Company meeting EMEA and LCC
               International objectives. 70% of the Bonus Target (i.e.
               US$70,000) is based on the Company achieving the EMEA objective
               described below ("EMEA Objective") and 30% of the Bonus Target
               (i.e. US$30,000) is based on the
<PAGE>   9

        Company achieving the LCC International objective, from
        continuing operations, described below ("LCC International
        Objective").

        8.5.1  The EMEA Objective and LCC International Objective are based
               the achievement of Revenue and EBIT targets:

               8.5.1.1  50% of EMEA Objective is dependant on achieving Revenue
                        of US$32.7 million (adjusted down by US$300,000 per
                        month for each month or part of a month up to 1 January
                        2000 in which the Company does not receive a tower
                        maintenance contract from MTN in South Africa); and

               8.5.1.2  50% of EMEA Objective is dependant on achieving EBIT
                        target of US$4.045 million (adjusted down to US$3.685
                        million if the Company does not receive a tower
                        maintenance contract from MTN in South Africa) ("EMEA
                        Objective EBIT Target");

               8.5.1.3  50% of LCC International Objective is dependant on
                        achieving Revenue of $90 Million (exclusive of any
                        revenue attributable to contracts with XM Satellite
                        Radio); and

               8.5.1.4  50% of LCC International Objective is dependant an EBIT
                        target of US$9 million.

        8.5.2  If the EMEA Objective is achieved bonus will be paid in
               accordance with clause 8.5.4.

               If the LCC Objective is achieved bonus will be paid in accordance
               with clause 8.5.4. The Executive and the Chief Executive officer
               of LCC International may review the LCC International Objective
               from time to time and make appropriate mutually acceptable
               adjustments.

               (EMEA Objective and LCC Objective together called the
               "Objectives")

        8.5.3  For the Objectives in clause 8.5.2 to be achieved both the EBIT
               and Revenue Targets for each Objective (subject to clause 8.5.4)
               must be met.

        8.5.4  The Bonus Target is paid as follows:

<TABLE>
<CAPTION>
                                      EMEA OBJECTIVE          LCC OBJECTIVE

               <S>                 <C>
               Target met          70% Target Bonus paid  30% Target Bonus paid
               95%-100%
</TABLE>

<PAGE>   10

<TABLE>
               <S>                 <C>
               Target met          35% Target Bonus paid  15% Target Bonus paid
               Less than 95%
               Target met          No Target Bonus paid   No Target Bonus paid
</TABLE>

        8.5.5  If EMEA EBIT exceeds 100% of EMEA Objective EBIT Target the
               Executive will receive 10% of the amount by which EBIT exceeds
               EMEA Objective EBIT Target.

        8.5.6  The Objectives include only services (engineering, programme
               management, outsourcing). The financial calculations do not
               include any deals to acquire, construct or manage
               telecommunications towers or sites.

        8.5.7  In this clause:-

               Revenue means turnover as shown in the audited accounts of the
               Company.

               EBIT means earnings before interest and tax as shown in the
               audited accounts of the Company.

               LCC International means LCC International, Inc.


9.      EXPENSES

        Provided that the Executive fully complies with the Company's expenses
        reporting procedure which may from time to time be notified to the
        Executive, the Company shall pay or reimburse to the Executive (subject
        to production of such vouchers and/or other evidence as it may require)
        all proper and reasonable expenses wholly, exclusively and necessarily
        incurred by him in connection within his duties hereunder up to the
        limit of a maximum budget determined from time to time by the Company.
        In addition, the Company will pay Executive a monthly car allowance of
        SFR2,250.


10.     BENEFITS

        The Executive may be entitled to such benefits as are offered by the
        Company from time to time.


11.     HOLIDAYS

        11.1   The Executive shall be entitled in every complete calendar year
               of employment here under (and pro rata where his employment is
               less than a complete calendar year) to 25 working days paid
               holiday per year, plus any Public or Bank holidays. This holiday
               entitlement is also inclusive of the Executive's statutory
<PAGE>   11

               holiday entitlement under the Regulations which shall be deemed
               to be taken first.

        11.2   The Company may, on termination of this employment, make a
               payment in lieu of outstanding holiday entitlement (in respect of
               the holiday year in which termination takes place). Equally, the
               Executive may be required to repay to the Company for holiday
               taken in excess of his actual entitlement for such year. For the
               purposes of this clause the basis of calculation shall be 1/261
               of basic annual salary for each such day's holiday entitlement.
               Any such payment made by the Company is made net of tax and
               national insurance contributions.

        11.3   No payment in lieu of untaken holiday entitlement is made where
               the employment is terminated by reason of gross misconduct.


12.     INCAPACITY

        12.1   The Executive shall give all assistance reasonably required by
               the Company to enable it to reclaim any statutory sick pay
               entitlement paid to the Executive, in default of which the
               Company shall be entitled to recover from the Executive or to
               deduct from any subsequent remuneration payable to the Executive
               any amount which the Company has been unable to reclaim in
               consequence.

        12.2   This clause shall not in any way affect the right of the Company
               to terminate this Agreement in the event of the Executive being
               prevented from performing his duties for the periods provided in
               clause 17.

        12.3   The Company may at its expense and at any time during the
               Executive's appointment require the Executive to submit to a
               medical examination by a doctor nominated by the Company.

<PAGE>   12

13.     CONFIDENTIALITY

        13.1   The Executive is aware that during this employment he will have
               access to, contact with, and be entrusted with trade secrets and
               secret and other confidential information of the Company
               ("Confidential Information"). In this Agreement the term
               "Confidential Information" shall include but shall not be limited
               to any trade secret or confidential or secret information
               concerning the business financing and organisation of the Company
               and their operations, processes, dealings, affairs, know how,
               customers, clients, suppliers, prospects, plans, research and
               development, trade secrets, financial projects and projections,
               technical information, target details and accounts, fee levels,
               pricing, policies, commissions and commission charges, budgets,
               forecasts, reports, interpretations, records, corporate and
               business plans, planned products and services, marketing and
               advertising plans requirements and materials, marketing surveys
               and research reports, market share and pricing statistics,
               computer software and passwords, prospective business, business
               methods, systems, transactions, accounts, trading or any
               information relating to customer requirements, service lists,
               structures, plans, designs, formulae, product lines together with
               any material marked confidential, any information which the
               Executive is told is confidential or ought reasonably to expect
               to be confidential, and any information given in confidence to
               the Company.

        13.2   In addition to, and without prejudice to his obligations under
               common law to keep confidential information secret, the Executive
               hereby agrees that he shall not, except as authorised or required
               in the proper performance of his duties hereunder, or ordered by
               a court of law, in any way, whether directly or indirectly,
               reveal to any person, firm, company, business entity or other
               organisation whatsoever, or use for his own purposes or for any
               purpose other than that of the Company, and shall use his best
               endeavours to prevent the improper use or disclosure of any
               Confidential Information (and shall report to the Company the
               improper use or disclosure of any Confidential Information).

        13.3   The restrictions in this clause shall apply during this
               employment and shall continue after its termination without limit
               in point of time, but shall cease to apply to Confidential
               Information which comes to the public domain otherwise than
               through an unauthorised use or disclosure by the Executive or a
               third party.

        13.4   The Executive shall not make or communicate any statement
               (whether written or oral) to any representative of the press or
               other media whatsoever, and shall not write for publication on
               any matter connected with or relating to the
<PAGE>   13

               business of the Company, and/or this employment and/or its
               termination, except with the specific prior consent in writing of
               the Board.

        13.5   Nothing in this clause shall be construed as preventing the
               Executive from making a "protected disclosure" within the meaning
               of the Public Interest Disclosure Act 1998.

        13.6   All notes, memoranda or other media by which such information may
               be recorded or stored (together with all copies thereof) of any
               Confidential Information together with all intellectual property
               rights which may subsist therein shall be and remain at all times
               the absolute property of the Company and shall be surrendered by
               the Executive to the Company (or as it shall direct) immediately
               on the termination of this employment and immediately on request
               by the Board whenever such request may be made.

        13.7   Examples of "confidential information" to expand this clause:

               13.7.1   details of customers and active prospects;

               13.7.2   details of their particular requirements and prices
                        offered;

               13.7.3   current/proposed suppliers, product and prices of supply
                        and supply capabilities;

               13.7.4   methods of manufacture, production processes and
                        production controls (including quality controls);

               13.7.5   costings, profit margins, discount rebates, financial
                        information;

               13.7.6   current activities and current/future plans;

               13.7.7   development of new product;

               13.7.8   production or design secrets.

        13.8   The Executive recognises that, in the proper performance of his
               duties hereunder he will have access to, come into contact with,
               and be entrusted with, Confidential Information including
               personal knowledge of, valuable personal contact with, and
               influence over, the clients, suppliers and employees of the
               Company. The Executive therefore agrees to the restrictions in
               clauses 15 and 16 and acknowledges that they are reasonable and
               necessary to protect the legitimate business interests of the
               Company, both during and after the termination of this
               employment.
<PAGE>   14

        13.9   The Executive acknowledges that prior to entering into this
               Agreement he took full and independent legal advice, on the
               nature, extent and enforceability of his obligations under this
               Agreement, and confirms, in particular, that he fully understands
               the nature and extent of his obligations under this clause 13 and
               that he was advised that the covenants contained in clauses 15
               and 16 are valid and enforceable against him. The Executive
               further acknowledges, that his remuneration hereunder has been
               agreed on the basis that such covenants are binding and
               enforceable against him.


14.     DATA PROCESSING

        14.1   The Executive acknowledges and accepts that information relating
               to him ("personal data") may be "processed" by the Company as
               required in order properly to fulfil the Company's obligations to
               the Executive under this Agreement and/or for reasons relating to
               or which may become related to the Executive's employment with
               the Company. Such processing will principally be for personnel,
               administrative, pay roll and other corporate purposes.

        14.2   The term "personal data" shall include information of a sensitive
               personal nature including information concerning:

               14.2.1   the Executive's racial or ethnic origin;

               14.2.2   the Executive's religious beliefs or other beliefs of a
                        similar nature;

               14.2.3   any commission or alleged commission by the Executive of
                        any offence; or

               14.2.4   any proceedings for any offence committed or alleged to
                        have been committed by the Executive, the disposal of
                        such proceedings or the sentence of any court in such
                        proceedings.

        14.3   The term "processing" includes the obtaining, recording or
               holding of personal data or carrying out any operation(s) on the
               personal data, including, inter alia, organising, altering,
               retrieving, consulting, using, disclosing or destroying the
               personal data.

        14.4   The Executive agrees that the Company may transfer personal data
               outside the European Economic Area.

        14.5   The Company (the data controller) will determine the purposes for
               which and the way in which personal data will be processed.

<PAGE>   15

15.     RESTRICTIONS DURING EMPLOYMENT

        Without prejudice to the provisions of clause 6 and except with the
        prior written consent of the Board, the Executive shall not during his
        employment hereunder whether directly or indirectly or whether solely or
        jointly with or as agent, director, partner, manager, employee,
        consultant, shareholder or independent contractor of or in any other
        capacity engage in, carry on or be interested in any other business.
        Provided that nothing in this clause shall preclude the Executive from
        being the holder or beneficial owner of any securities in any other
        company which are listed or dealt in on any recognised stock exchange by
        way of bona fide investment only and where the Executive (together with
        his spouse, children, parents and parents' issue) neither holds nor is
        beneficially interested in more than a total of 5 per cent of any single
        class of the securities in that company.


16.     RESTRICTIONS AFTER EMPLOYMENT

        16.1   The Executive shall not:

               16.1.1   for a period of 12 months after termination of his
                        employment, (less the Leave Period) in competition with
                        the Company, directly or indirectly, and whether on his
                        own behalf or for any other person, firm, company,
                        business entity or other organisation solicit or induce
                        (or attempt or assist in so doing) any Restricted
                        Employee to leave the Company and join, or provide
                        services for, a Competing Business;

               16.1.2   for a period of 12 months after termination of his
                        employment, (less the Leave Period) in competition with
                        the Company, directly or indirectly and whether on his
                        own behalf or for any other person, firm, company,
                        business entity or other organisation, solicit or induce
                        (or attempt or assist in so doing) away from the Company
                        to a Competing Business, the custom or business of any
                        Restricted Client for the purpose of providing to the
                        Restricted Client services which are the same as, or of
                        a materially similar kind to, those services formerly
                        supplied to the Restricted Client by the Restricted
                        Business in the last 12 months of his employment;

               16.1.3   for a period of 12 months after termination of his
                        employment, (less the Leave Period) in competition with
                        the Company, directly or indirectly and whether on his
                        own behalf or for any other person, firm, company,
                        business entity or other organisation entice, solicit or
                        induce (or attempt or assist in so doing) away from the
                        Company to a Competing Business the supply of materials
                        from any Restricted Suppliers for the purpose of gaining
                        the supply of materials from such supplier which are the
                        same
<PAGE>   16

                        as, or of a materially similar kind to those supplied by
                        the supplier to the Restricted Business in the last 12
                        months of his employment.

        16.2   If the:

               16.2.1   Executive's employment is terminated by the Company for
                        misconduct or any reason falling within clause 17.1 the
                        Executive will be subject to the Non-Competition
                        Restriction as defined below for a period of 6 months
                        after the termination of his employment. The Executive
                        shall be bound by the Non-Competition Restriction for an
                        additional period of a further 6 months (less any Leave
                        Period) PROVIDED ALWAYS that the Company pays to the
                        Executive during the additional period an amount each
                        month that is equivalent to his monthly salary. For the
                        avoidance of doubt the Company shall make no payment of
                        any salary during the initial 6 month period;

               16.2.2   Executive gives full and proper notice of termination of
                        his employment in accordance with clause 3.1 of this
                        Agreement the Executive will be subject to the
                        Non-Competition Restriction as defined below for a
                        period of 6 months after the termination of his
                        employment PROVIDED ALWAYS that the Company pays to the
                        Executive during this 6 month period an amount each
                        month that is equivalent to his monthly salary;

               16.2.3   Executive fails to give proper notice of termination in
                        accordance with clause 3.1 of this Agreement (which, for
                        the avoidance of doubt will amount to a breach of this
                        Agreement) by giving shorter or no notice, the Executive
                        will be subject to the Non-Competition Restriction as
                        defined below for the period by which the notice given
                        by the Executive is shorter than the notice required to
                        be given under clause 3.1, or where no notice is given,
                        for the period of 6 months. For the avoidance of doubt
                        the Company shall make no payment of any salary during
                        any such period. The Executive shall be bound by the
                        Non-Competition Restriction for an additional period of
                        a further six months (less any Leave Period) PROVIDED
                        ALWAYS that the Company pays to the Executive during the
                        additional period an amount each month that is
                        equivalent to his monthly salary;

               16.2.4   Executive's employment is terminated by the Company for
                        a reason not set out in Clause 16.2.1 the Executive will
                        be subject to the Non-Competition Restriction as defined
                        below for a period of 12 months (less any Leave Period)
                        after the termination of his employment PROVIDED ALWAYS
                        that the Company pays to the Executive an amount each
                        month that is equivalent to his monthly salary.
<PAGE>   17

                        "Non-Competition Restriction" means: the Executive shall
                        not after termination of his employment, whether on his
                        own behalf, or for any other person, firm, company,
                        business entity or other organisation, be directly or
                        indirectly employed or engaged in or perform services in
                        respect of or be concerned with or interested in or
                        accept a directorship of or hold any other office within
                        any Competing Business in those geographical areas in
                        which he was so involved, on behalf of the Company
                        during the final 12 months of his employment.

        16.3   The Executive covenants that, in respect of any Associated
               Company in the business and/or affairs of which he shall at any
               time during the period of 12 months immediately preceding the
               termination of this employment, have been involved to a material
               extent (a "Relevant Associated Company"), he will perform and
               observe the several covenants set out above and that each such
               covenant shall be construed and enforced as a separate covenant
               in respect of each Relevant Associated Company and the invalidity
               or unenforceability of any such covenant shall not affect the
               validity or enforceability of the covenants in favour of the
               Company or any other Relevant Associated Company. For the
               purposes of giving effect to this sub-clause references to the
               Company in this clause and in the definitions of Prohibited
               Business(es), Restricted Area, Restricted Person, and Restricted
               Client shall be deemed to refer to the relevant businesses,
               geographical area(s), personnel and clients and prospective
               clients of any Relevant Associated Company.

        16.4   Nothing in this clause shall preclude the Executive from holding
               by way of bona fide investment only, not more than 5% of any
               class of issued shares or other securities which are listed or
               dealt in on any recognised investment exchange.

        16.5   Each of the restrictions set out in this clause constitutes an
               entirely separate, severable and independent restriction on the
               Executive.

        16.6   While the restrictions contained in this clause are considered by
               the Executive and the Company to be reasonable in all the
               circumstances it is recognised that restrictions of the nature in
               question may fail for reasons unforeseen and accordingly it is
               hereby declared and agreed that if any of such restrictions shall
               be adjudged to be void as going beyond what is reasonable in all
               the circumstances for the protection of the interests of the
               Company and/or a Relevant Associated Company but would be valid
               if part of the wording thereof were deleted and/or the periods
               (if any) thereof reduced and/or the scope and/or geographical
               area dealt with reduced the said restrictions shall apply with
               such modifications as may be necessary to make them valid and
<PAGE>   18

               enforceable and any such modification shall not thereby affect
               the validity of any other restriction contained in this
               Agreement.


17.     TERMINATION

        17.1   Notwithstanding any other provision of this Agreement, the
               Company (without prejudice to its other rights and remedies) may
               terminate this Agreement forthwith by written notice to the
               Executive if he shall:

               17.1.1   commit any serious or persistent breach of any of his
                        obligations under this Agreement or fail to remedy any
                        such breach capable of remedy within 30 days of
                        receiving notice in writing requiring him so to do or
                        shall neglect or fail (otherwise than by reason of
                        accident or ill health) or refuse to carry out the
                        duties reasonably required of him hereunder or to comply
                        with any lawful and reasonable orders or directions
                        given to him by the Board (or such officer of LCC
                        International, Inc. as the Board shall designate)
                        consistent with the terms of this Agreement;

               17.1.2   be guilty of any fraud, dishonesty, serious breach of
                        duty or serious misconduct or any other conduct
                        calculated or likely to affect prejudicially the
                        interests or reputation of the Company;

               17.1.3   be convicted of any criminal offence involving
                        dishonesty;

               17.1.4   become bankrupt or make any arrangement or composition
                        with his creditors;

               17.1.5   be or become of unsound mind or be or become a patient
                        for any purpose of any enactment relating to mental
                        health;

               17.1.6   by reason of illness, accident or for any other cause
                        become or be unable properly to perform in whole or in
                        part his duties hereunder for an unbroken period of 26
                        consecutive weeks;

               17.1.7   fail to perform the material duties of his position
                        having been given notice of such failure to perform and
                        not having remedied such failure to perform within any
                        period specified in such notice.

        17.2   In the event that the Executive is not given notice under clause
               3.1 and instead the Company exercises its right to pay the
               Executive in lieu of notice under clause 3.3 the Executive will
               receive his salary in monthly instalments (normally on or around
               the last day of each month) until the date, if any, on which the
               Executive secures alternative employment or enters into an
               arrangement under
<PAGE>   19

               which he will act as a consultant to a person, firm, company,
               business entity or other organisation.


18.     RETURN OF COMPANY PROPERTY

        18.1   The Executive shall promptly whenever requested by the Company
               and in any event immediately upon the termination of his
               employment deliver to the Company (or as it may direct) all motor
               cars, credit cards, keys and passes, equipment, lists of clients
               and customers, address lists, address books, computers, computer
               discs, software, computer hardware, correspondence, documents,
               books, papers, files, records and reports and other property or
               material (irrespective of the medium in which such information
               may be recorded or stored) belonging to or relating to the
               business of the Company or to its customers or clients which may
               have come into his possession, custody or control in the course
               of or in consequence of this employment and the Executive shall
               not be entitled to and shall not retain any copies or summaries
               thereof or extracts therefrom. The Executive shall delete all
               such information, together with all Confidential Information
               stored on equipment belonging to him, or on equipment belonging
               to the Company which the Company shall specifically notify to him
               in writing that he is not required to return under the terms of
               this clause. The Executive will on request, sign an undertaking
               of compliance with his obligations pursuant to this clause.


19.     INVENTIONS AND IMPROVEMENTS

        19.1   The Executive acknowledges that because of the nature of his
               duties and the particular responsibilities arising as a result of
               such duties which he owes to the Company and to any Associated
               Companies, he has a special obligation to further the interests
               of the Company and Associated Companies. In particular, his
               duties may include reviewing the products and services of the
               Company and any Associated Companies with a view to improving
               them with new and/or original ideas, designs, works and
               inventions and implementing such improvements.

        19.2   The Executive agrees that he shall promptly disclose to the
               Company any idea, design, work or invention which is relevant to
               or capable of use in the business of the Company or any
               Associated Companies made by him in the course of his employment,
               whether or not in the course of his duties. All ideas, designs,
               works and inventions of any nature whatsoever in connection with
               the business of the Company or of any Associated Companies, which
               are made by the Executive or in which he has played a part in
               making during the course of his
<PAGE>   20

               employment shall be the exclusive property of the Company. The
               Executive acknowledges that the benefits of all patents,
               copyrights and other intellectual property rights (if any) in
               respect of such ideas, designs, works or inventions, which arise
               anywhere in the world or in any part or parts of the world, shall
               also be the exclusive property of the Company.

        19.3   The Executive will at the request of and at the expense of the
               Company, do and execute all such things and documents as may be
               necessary to give the Company the full benefit of such ideas,
               designs, works and inventions. By signing this Agreement, the
               Executive waives any rights which he may have in any such ideas,
               designs, works or inventions which are or have been conferred
               upon him by Chapter IV of Part I of the Copyright, Designs and
               Patents Act 1988 headed "Moral Rights".

        19.4   The Executive hereby irrevocably and by way of security appoints
               the Company and each Associated Company now or in the future
               existing to be his attorney and in his name and on his behalf to
               sign, execute and do all acts, things and documents which he is
               obliged sign, execute and do under the provisions of this
               Agreement and the Executive hereby agrees forthwith on the
               request of the Board to ratify and confirm all such acts, things
               and documents signed, executed or done in pursuance of this
               power.


20.     GRIEVANCE AND DISCIPLINARY PROCEDURE

        20.1   If the Executive wishes to seek redress of any grievance relating
               to this employment (other than one relating to a disciplinary
               decision) he should refer such grievance to his line manager
               (presently, Don Rose) for resolution. If the grievance is not
               resolved by discussion with his line manager it will be referred
               to the Board (excluding Executive) for resolution. The Executive
               accepts that the Board's decision shall be final and binding upon
               him.

        20.2   The Company's disciplinary procedures from time to time in force
               shall apply to the Executive.


21.     RECONSTRUCTION OR AMALGAMATION

        If this employment is terminated by reason of the liquidation of the
        Company for the purpose of reconstruction or amalgamation and the
        Executive is offered employment with any concern or undertaking
        resulting from the reconstruction or amalgamation on terms and
        conditions not less favourable than the terms of this Agreement, then
        the Executive shall have no claim against the Company in respect of the
        termination of his employment under this Agreement.


22.     GENERAL
<PAGE>   21

        22.1   No failure or delay by the Company in exercising any right, power
               or privilege under this Agreement shall operate as a waiver
               thereof nor shall any single or partial exercise by the Company
               of any right, power or privilege preclude any further exercise
               thereof or the exercise of any other right, power or privilege.

        22.2   There are no collective agreements which directly affect the
               terms and conditions of the Executive's employment. The
               information required to be given to the Executive under the Act
               is set out in this Agreement.


23.     NOTICES

        23.1   Any notice or other communication required or permitted to be
               given or made under this Agreement shall be in writing and be
               delivered to the relevant party personally or sent by first class
               prepaid letter to the address of that party specified in this
               Agreement or to that party's telex or facsimile number thereat or
               at such other address or telex or facsimile number as may be
               notified from time to time for this purpose by that party.
               Service at the last notified address or telex or facsimile number
               shall be effective for the purposes of this Agreement
               notwithstanding the fact that either party may subsequently have
               changed its address or telex or facsimile number without having
               notified the other party under the provisions of this clause.

        23.2   Unless the contrary shall be proved each such notice or
               communication shall be deemed to have been received, if by
               letter, 72 hours after posting and, if by personal delivery or
               telex, when, respectively delivered or transmitted. A notice by
               facsimile shall be deemed received on receipt by the sender of
               the correct answer back message.


24.     OTHER AGREEMENTS

        This Agreement contains the entire understanding between the parties and
        supersedes and replaces all previous contracts of service or other
        employment arrangements (whether written or oral) between the Executive
        and the Company which, as from the commencement of this Agreement, shall
        have no further effect and shall be deemed terminated by mutual consent.
        The Executive acknowledges and warrants to the Company that he is not
        entering into this Agreement in reliance upon any representation not
        expressly set out in this Agreement.


25.     GOVERNING LAW

        This Agreement shall be governed by and construed in all respects in
        accordance with English law and the parties hereto agree to submit to
        the non-exclusive jurisdiction of the English Courts as regards any
        claim or matter arising in respect of this Agreement.



<PAGE>   22


IN WITNESS whereof this Agreement has been executed and delivered as a Deed by
or on behalf of the parties hereto the day and year first above written.

EXECUTED as a deed by                       )
LCC UNITED KINGDOM LIMITED                  )
and signed by two duly                      )
authorized officers on its behalf:          )
                                                   [sig]
                                                  Director

                                            Director/Secretary


SIGNED as a deed by                         )
PETER ZAUGG                                 )       [sig]
in the presence of:                         )

Signature of Witness:                       /s/ JAN M. FONGEN

Name of Witness                             JAN M. FONGEN

Address of Witness:                         20 HAREWOOD AVE., LONDON, UK

Occupation of Witness:                      REGIONAL DIRECTOR