No. 2719
                                                                           -----

                       MASTER AGREEMENT TO LEASE EQUIPMENT


         THIS MASTER AGREEMENT TO LEASE EQUIPMENT (this  "Agreement") is entered
into as of February 22, 2000 by and between  CISCO SYSTEMS  CAPITAL  CORPORATION
("Lessor"),  having its  principal  place of business at 170 West Tasman  Drive,
Mailstop SJC2, 3rd Floor, San Jose, California 95134 and VDC TELECOMMUNICATIONS,
INC., a Delaware corporation ("Lessee"),  having its principal place of business
at 75 Holly Hill Lane, Greenwich, Connecticut 06830.



                                  1. THE LEASE
                                     ---------

         1.1    Lease of Equipment.  In accordance with the terms and conditions
of this  Agreement,  Lessor  shall lease to Lessee,  and Lessee shall lease from
Lessor,  the personal  property  described  in the lease  schedule(s)  (each,  a
"Schedule")  to be entered  into from time to time into which this  Agreement is
incorporated (each Schedule,  together with this Agreement, a "Lease"), together
with  all   substitutions,   replacements,   repairs,   parts  and  attachments,
improvements and accessions  thereto (the  "Equipment").  Capitalized  terms not
otherwise  defined  in  this  Agreement  have  the  meanings  specified  in  the
applicable  Schedule.  Each Lease shall  constitute  a separate,  distinct,  and
independent lease and contractual  obligation of Lessee. Except as expressly set
forth in any Lease, Lessor shall at all times retain the full legal title to the
Equipment,  it being  expressly  agreed by both  parties  that each  Lease is an
agreement of lease only.

         1.2    Equipment  Procurement.  Lessee  has  ordered  or  may order the
Equipment  pursuant  to  one or  more  purchase  orders  or  purchase  contracts
(together, "Purchase Order") to or with Cisco Systems, Inc., or a Cisco-approved
reseller (together,  "Vendor"), which Purchase Order shall be promptly delivered
to Lessor in the event that the parties agree to enter into a lease  transaction
with  respect  to the  Equipment  described  in such  Purchase  Order.  Lessor's
agreement  to enter  into such a lease  transaction  is  evidenced  by  Lessor's
preparation and delivery of a Schedule,  and the terms of such agreement will be
set forth in such Schedule,  provided, however, that the terms of this Agreement
are hereby incorporated into every Schedule whether or not such incorporation is
stated therein. Lessor's failure or refusal to deliver a Schedule to Lessee will
not constitute a breach of this Agreement or of any Lease. Lessee's agreement to
enter into such a lease  transaction  according  to the terms of the  previously
delivered  Schedule is  evidenced by Lessee's  execution  of the Purchase  Order
together with either notification of its decision to execute the Schedule or the
absence of any  affirmative  notification  from Lessee that it has not agreed to
execute the Schedule delivered to it (i.e. silence by Lessee up to and including
the time  that  Lessee  executes  a  Purchase  Order is  deemed  to be  Lessee's
agreement to execute the Schedule).

         If it agrees or is deemed to agree to lease from  Lessor,  then  Lessee
shall execute and return to Lessor (a) each Schedule within ten days of Lessee's
receipt of same, and (b) all related or  accompanying  Certificate of Acceptance
within ten days of receipt and  acceptance  of the  applicable  Equipment.  Upon
Lessee's  agreement  or deemed  agreement  to lease from  Lessor  (as  evidenced

<PAGE>

above),  Lessee shall be deemed to have  assigned to Lessor all Lessee's  right,
title and interest in and to the Equipment and the Purchase Order; provided that
Lessor  shall have no  obligations  under the  Purchase  Order other than as set
forth in the next  sentence.  Upon  Lessee's  execution of each Schedule and the
related  Certificate(s)  of Acceptance,  and subject to the following  sentence,
Lessor shall cause the purchaser's  obligations  with respect to that portion of
the purchase  price  contained in such  Purchase  Orders which is subject to the
Lease (as set forth in the Schedule) to be discharged.  Notwithstanding anything
to the contrary  contained herein, if for whatever reason a lease transaction in
respect  of the  Equipment  or a  Purchase  Order  is not  consummated,  then no
assignment of the Purchase  Order shall have  occurred,  and Lessee shall remain
solely liable to pay Vendor in accordance  with the Purchase Order. In the event
that  Lessee  does not  execute  the  Schedule  and  related  Certificate(s)  of
Acceptance  or  that  Lessor  determines  that no  lease  transaction  has  been
consummated  for any other  reason but that Vendor may seek  payment from Lessor
anyway,  then the Purchase Order will not be returned to Lessee, and Lessee will
have no rights  thereunder  until Lessee has fully paid the  Purchase  Order and
provided Lessor with proof of such full payment.

         1.3    Term of Lease.  The Original  Term of each Lease shall begin  on
the  Commencement  Date as specified in the applicable  Schedule and, subject to
Sections 3.5 and 4.2,  shall  terminate on the date  specified in the applicable
Schedule.  If so provided in the applicable Schedule,  the Original Term for any
Lease may be succeeded by one or more  Extended  Terms.  Subject to Sections 3.5
and 4.2 and any express  provisions of the Schedule,  no Lease may be terminated
by Lessor or Lessee, for any reason whatsoever, prior to the end of the Original
Term or any pending Extended Term.

         1.4    Rental Payments.  Lessee shall pay Lessor Rent for the Equipment
in the amounts and at the times specified in the applicable  Schedule.  All Rent
and other amounts payable by Lessee to Lessor  hereunder shall be paid to Lessor
at the address  specified  above, or at such other place as Lessor may designate
in writing to Lessee from time to time.

         1.5    Return of Equipment.  If Lessee  has not  exercised  a  purchase
option,  if any, with respect to the  Equipment,  then,  upon  expiration of the
Lease Term,  Lessee  shall  immediately  return the  Equipment  to Lessor in the
condition and at the place provided in Section 3.3.

              2. DISCLAIMERS AND WARRANTIES; INTELLECTUAL PROPERTY
                 -------------------------------------------------

         2.1    Disclaimers;  Warranties.  Lessee  represents  and  acknowledges
that the Equipment is of a size,  design,  capacity and manufacture  selected by
it,  and that it  expects  that  the  Equipment  is  suitable  for its  purposes
(provided,  that upon executing a Certificate of Acceptance,  Lessee  represents
that the Equipment is suitable for its purposes). LESSEE LEASES THE EQUIPMENT AS
IS, AND, NOT BEING THE MANUFACTURER OF THE EQUIPMENT,  THE MANUFACTURER'S  AGENT
OR THE SELLER'S AGENT,  LESSOR MAKES NO WARRANTY OR  REPRESENTATION,  EXPRESS OR
IMPLIED, AS TO THE MERCHANTABILITY,  FITNESS FOR ANY PARTICULAR PURPOSE,  DESIGN
OR CONDITION OF THE EQUIPMENT.  LESSOR SHALL NOT BE RESPONSIBLE  FOR ANY LOSS OR
DAMAGE   RESULTING   FROM  THE   INSTALLATION,   OPERATION   OR  OTHER  USE,  OR
DEINSTALLATION OF THE EQUIPMENT,  INCLUDING ANY DIRECT, INDIRECT,  INCIDENTAL OR

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<PAGE>

CONSEQUENTIAL  DAMAGES OR LOSS.  Lessee shall look solely to the manufacturer or
the supplier of the Equipment for correction of any problems that may arise with
respect thereto, and all transferable  manufacturer and supplier warranty rights
are, to the extent such rights have been transferred to Lessor,  hereby assigned
without representation or warranty by Lessor to Lessee for the Lease Term, which
warranties Lessee is authorized to enforce (except that Lessee is not authorized
to  enforce  such  rights if and when there  exists an Event of Default  and the
enforcement of such rights would materially hamper,  delay or prejudice Lessor's
enforcement  rights and remedies  hereunder).  Any such enforcement  shall be at
Lessee's sole cost and expense.

         2.2    Intellectual Property.  Lessee acknowledges  that  neither  this
Agreement nor any Lease conveys any explicit or implicit  license for the use of
software or other intellectual property of Cisco Systems, Inc. or its affiliates
relating  to the  Equipment  and that such  license  rights,  to the extent they
exist, are contained in separate  documentation  entered into between Lessee and
Cisco  Systems,   Inc.  or  other   persons.   LESSOR  MAKES  NO  WARRANTIES  OR
REPRESENTATIONS  WHATSOEVER WITH RESPECT TO THE  INTELLECTUAL  PROPERTY  RIGHTS,
INCLUDING ANY PATENT,  COPYRIGHT AND TRADEMARK  RIGHTS,  OF ANY THIRD PARTY WITH
RESPECT TO THE EQUIPMENT,  WHETHER RELATING TO INFRINGEMENT OR OTHERWISE. Lessor
shall, when reasonably requested in writing by Lessee,  provided there exists no
Event of Default and an indemnity satisfactory to Lessor is delivered by Lessee,
and at Lessee's cost and expense, enforce rights of indemnification, if any, for
patent,  copyright or other intellectual property infringement obtained from the
manufacturer  under any  agreement  for purchase of the  Equipment.  If notified
promptly in writing of any action  brought  against Lessee based on a claim that
the Equipment infringes a United States patent,  copyright or other intellectual
property  right,  Lessor  shall  promptly  notify the  manufacturer  thereof for
purposes of exercising,  for the benefit of Lessee, Lessor's rights with respect
to such claim under any such agreement.

                              3. LESSEE OBLIGATIONS
                                 ------------------

         3.1    Net Lease; Payments  Unconditional.  EACH LEASE IS A NET  LEASE,
AND ALL COSTS, EXPENSES AND LIABILITIES RELATING TO THE EQUIPMENT,  INCLUDING IN
RESPECT OF TAXES,  INSURANCE AND  MAINTENANCE,  SHALL BE BORNE SOLELY BY LESSEE.
EXCEPT IN THE EVENT  THAT  LESSOR  OR ITS  AGENTS  REPOSSESS  THE  EQUIPMENT  IN
MATERIAL BREACH OF THE TERMS OF THIS AGREEMENT,  LESSEE'S  OBLIGATION TO PAY ALL
RENT  AND  OTHER  SUMS  THEREUNDER,  AND THE  RIGHTS  OF  LESSOR  IN AND TO SUCH
PAYMENTS,  SHALL BE ABSOLUTE AND UNCONDITIONAL,  AND SHALL NOT BE SUBJECT TO ANY
ABATEMENT, REDUCTION, SETOFF, DEFENSE, COUNTERCLAIM,  INTERRUPTION, DEFERMENT OR
RECOUPMENT, FOR ANY REASON WHATSOEVER.

         3.2    Use of Equipment.  Lessee shall use the Equipment  solely in the
conduct  of its  business,  in a  manner  and for the  use  contemplated  by the
manufacturer  thereof, and in compliance with all laws, rules and regulations of
every  governmental  authority having  jurisdiction over the Equipment or Lessee
and with the provisions of all policies of insurance  carried by Lessee pursuant
to Section 3.6.

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<PAGE>

         3.3    Delivery;   Installation;   Return;  Maintenance   and   Repair;
Inspection.  Lessee shall be solely responsible, at its own expense, for (a) the
delivery of the  Equipment to Lessee,  (b) the packing,  rigging and delivery of
the Equipment back to Lessor,  upon  expiration or termination of the Lease Term
(provided that Lessee has not exercised a purchase option,  if any, with respect
to such Equipment),  in good repair,  condition and working order, ordinary wear
and tear  excepted,  at the  location(s)  within the  continental  United States
specified by Lessor, and (c) the installation, de-installation,  maintenance and
repair of the  Equipment.  During the Lease Term,  Lessee  shall ensure that the
Equipment is covered by a maintenance agreement,  to the extent available,  with
the  manufacturer  of the  Equipment  or other party  reasonably  acceptable  to
Lessor.  Lessee  shall,  at its  expense,  keep the  Equipment  in good  repair,
condition  and  working  order,  ordinary  wear  and tear  excepted,  and at the
expiration  or  termination  of  the  Lease  Term  with  respect  to  any of the
Equipment,   have  such  Equipment   inspected  and  certified   acceptable  for
maintenance  service  by the  manufacturer.  If any of the  Equipment,  upon its
return to Lessor, is not in good repair,  condition and working order,  ordinary
wear  and  tear  excepted,  and so  inspected  and  certified,  Lessee  shall be
obligated to pay Lessor for the out-of-pocket expenses Lessor incurs in bringing
such  Equipment up to such status,  but not in excess of the Casualty  Value for
such  Equipment,  promptly  after its receipt of an invoice  for such  expenses.
Lessor shall be entitled to inspect the Equipment at reasonable times.

         3.4    Taxes. Lessee shall pay, and hereby indemnifies Lessor on a net,
after-tax  basis,  against,  and shall hold it harmless  from, all license fees,
assessments, and sales, use, property, excise and other taxes and charges, other
than those  measured by Lessor's net income,  now and  hereafter  imposed by any
governmental body or agency upon or with respect to any of the Equipment, or the
possession,   ownership,  use  or  operation  thereof,  or  any  Lease,  or  the
consummation of the transactions contemplated by any Lease.  Notwithstanding the
foregoing,  to the extent  required of it by applicable law and in reliance upon
Lessee's  disclosure  of the  location  of such  Equipment,  Lessor  shall  file
personal  property tax returns,  and shall pay personal  property  taxes payable
with respect to the Equipment. Lessee shall pay to Lessor the amount of all such
personal  property  taxes  within 15 days of its  receipt of an invoice for such
taxes.  For any  Lease  that is  specified  as an FMV  Lease  in the  applicable
Schedule,  Lessee  acknowledges that it is the intent of Lessor,  and a material
inducement  to Lessor to enter into such Lease,  to obtain all state and Federal
income tax benefits of ownership with respect to the Equipment under such Lease,
including entitlement to annual accelerated cost recovery deductions.

         3.5    Loss of Equipment.  Lessee assumes  the  risk  that,  and  shall
promptly  notify  Lessor in writing  if,  any item of  Equipment  becomes  lost,
stolen,  damaged,  destroyed or otherwise  unfit or unavailable for use from any
cause  whatsoever  (an "Event of Loss") after it has been  delivered to a common
carrier  for  shipment to Lessee.  Unless the item is damaged  and is  reparable
within a  reasonable  period of time in the  judgment  of Lessor (in which event
Lessee  shall  promptly  cause  such item to be  repaired  and  restored  to the
condition  and  value it had  prior to such  Event of Loss,  at its own cost and
expense), Lessee shall pay to Lessor on the Rent payment date following Lessor's
receipt of such  notice  (or,  if none,  30 days  after such Event of Loss),  an
amount  equal to the Rent  payment or payments  due and payable  with respect to
such Equipment on or prior to such date,  plus a sum equal to the Casualty Value
of such Equipment as of such date.  Upon making such payment,  the Rent for such
Equipment  shall  cease to  accrue,  the term of the Lease as to such  Equipment
shall terminate and (except in the case of loss,  unrecovered  theft or complete
destruction) Lessor shall be entitled to recover possession of such Equipment in

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<PAGE>

accordance  with the provisions of Section 3.3 above. If Lessor has received the
foregoing  amount,  Lessee  shall be entitled to the proceeds of any recovery in
respect of such  Equipment  from  insurance or  otherwise,  provided that if the
Equipment  is subject to an FMV Lease,  Lessee shall be entitled to receive such
proceeds only up to the Casualty Value therefor, any excess amount to be paid to
Lessor.

         3.6    Insurance.  Lessee shall obtain and maintain for the Lease  Term
at its own  expense,  property  damage and  liability  insurance  and  insurance
against loss or damage to the Equipment as a result of fire,  explosion,  theft,
vandalism  and such other risks of loss as are normally  maintained on equipment
of the type leased  hereunder  by  companies  carrying on the  business in which
Lessee is engaged, in such amounts, in such form and with such insurers as shall
be  satisfactory to Lessor.  Each insurance  policy shall name Lessee as insured
and Lessor and its assignees as additional  insureds and loss payees  thereof as
their  interest  may appear,  and shall  provide that it may not be cancelled or
altered  without at least 30 days' prior written  notice  thereof being given to
Lessor (or 10 days', in the event of non-payment of premium).

         3.7    Indemnity.  Except with  respect  to  the  gross  negligence  or
willful  misconduct of Lessor (and this exception includes cases in which Lessee
must  commence  an action  against  Lessor on  account  of a gross and  material
violation  of  Lessor's   obligations  under  this  Agreement),   Lessee  hereby
indemnifies,  protects,  defends and holds harmless  Lessor from and against any
and all claims,  liabilities (including negligence,  tort and strict liability),
demands,  actions, suits, and proceedings,  losses, costs, expenses and damages,
including reasonable attorneys' fees and costs (collectively, "Claims"), arising
out of, connected with, or resulting from any Lease or any of the Equipment,  or
any ancillary or related software or other intangibles,  whether arising before,
during or after the Lease  Term (but not  Claims  relating  to events  occurring
after Lessee has returned the Equipment to Lessor in accordance with Section 3.3
or after the Equipment has  otherwise  been removed from Lessee's  possession or
control by Lessor),  including  Claims relating to the  manufacture,  selection,
purchase,  delivery,  possession,  condition,  use,  operation,  return or other
disposition  of the  Equipment.  Each of the parties shall give the other prompt
written notice of any Claim of which it becomes aware.

         3.8    Prohibitions  Related to Lease and Equipment.  Without the prior
written  consent of Lessor,  which consent as it pertains to clauses (b) and (d)
below  shall  not be  unreasonably  withheld,  Lessee  shall  not:  (a)  assign,
transfer,  or  otherwise  dispose of any  Equipment,  the Lease or any rights or
obligations  thereunder;  (b)  sublease  any  of the  Equipment  or  permit  the
Equipment to be controlled by any other person;  (c) create or incur,  or permit
to exist, any security interest,  lien or encumbrance with respect to any of the
Equipment;  (d)  cause or  permit  any of the  Equipment  to be  moved  from the
location specified in the applicable Schedule; or (e) cause or permit any of the
Equipment to be moved outside the continental United States.

         3.9    Identification.   Lessee  shall  place  and  maintain  permanent
markings provided by Lessor on the Equipment evidencing ownership,  security and
other interests therein, as specified from time to time by Lessor.

         3.10   Alterations  and  Modifications.   Lessee  shall  not  make  any
additions, attachments, alterations or improvements to the Equipment without the
prior written consent of Lessor, not to be unreasonably  withheld. Any addition,
attachment,  alteration or improvement to any item of Equipment  shall belong to

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and  become the  property  of Lessor  unless,  at the  request of Lessor,  it is
removed prior to the return of such item of Equipment by Lessee. Lessee shall be
responsible  for all costs  relating to such removal and shall restore such item
of Equipment to the condition and value otherwise required hereunder.

         3.11   Personal Property.  Lessee acknowledges  and represents that the
Equipment shall be and remain personal property,  notwithstanding  the manner by
which it may be attached or affixed to realty,  and Lessee shall do all acts and
enter  into all  agreements  necessary  to  ensure  that the  Equipment  remains
personal property. If reasonably requested by Lessor with respect to any item of
Equipment, Lessee shall obtain and deliver to Lessor equipment access agreements
or like  protections,  reasonably  satisfactory  to  Lessor,  from  all  persons
claiming  any  interest in the real  property on which such item of Equipment is
installed or located.

         3.12   Financial Statements. Lessee shall promptly  furnish  to  Lessor
such  financial or other  statements  regarding the condition and  operations of
Lessee and any guarantor of any Lease, and information  regarding the Equipment,
as Lessor may from time to time  reasonably  request,  provided,  however,  that
Lessee has no obligation to furnish  financial  information where the release of
such  information  would  violate or be  reasonably  likely to violate  state or
federal  securities  laws or applicable  regulations of any stock exchange where
Lessee's securities are listed.

         3.13   Lessee Representations.  Lessee  hereby  represents  that,  with
respect to this Agreement, and each Schedule,  certificate evidencing acceptance
of equipment,  assignment of purchase order, insurance letter,  proposal letter,
UCC financing  statement,  or other document now or hereafter executed by Lessee
in  connection  with  any  Lease  (collectively,  "Lease  Documents"):  (a)  the
execution,  delivery and performance  thereof by Lessee or its  attorney-in-fact
have been duly  authorized by all necessary  corporate,  partnership  or company
action; (b) the person executing such documents is duly authorized to do so; and
(c) such documents  constitute legal,  valid and binding  obligations of Lessee,
enforceable in accordance with their terms.

                             4. DEFAULT AND REMEDIES
                               ---------------------

         4.1    Events of Default.  The occurrence of any of the following shall
constitute  an "Event of Default"  hereunder  and under each  Lease:  (a) Lessee
fails to pay any Rent or other  amount due under any Lease within ten days after
it becomes due and payable; (b) any representation or warranty of Lessee made in
any Lease  Document  proves to have been  false or  misleading  in any  material
respect as of the date when it was made; (c) Lessee fails to maintain  insurance
as required  herein or breaches  any of clauses  (a), (b) or (e) of Section 3.8;
(d) Lessee fails to perform any other material covenant,  condition or agreement
made by it  under  any  Lease,  and such  failure  continues  for 20  days;  (e)
bankruptcy, receivership, insolvency,  reorganization,  dissolution, liquidation
or other similar  proceedings are instituted by or against Lessee, any guarantor
of any Lease or any partner of a partnership Lessee or guarantor,  or all or any
part of such person's  property,  under the Federal Bankruptcy Code or other law
of the  United  States  or of any other  competent  jurisdiction,  and,  if such
proceeding is brought against such person, it consents thereto or fails to cause
the  same to be  discharged  within  45  days  after  it is  filed;  (f)  Lessee
materially  defaults  under  any  agreement  with  respect  to the  purchase  or
installation  of any of the  Equipment;  or (g) Lessee or any  guarantor  of any
Lease, or any of their  respective  subsidiaries or other  affiliates,  defaults

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under any other  material  instrument or agreement with Lessor or Cisco Systems,
Inc.

         4.2    Remedies.  If an Event of Default  exists,  Lessor may  exercise
any one or more of the  following  remedies,  in addition to those arising under
applicable law: (a) proceed, by appropriate court action, to enforce performance
by Lessee of the applicable covenants of any or all of the Leases; (b) terminate
any or all Leases by notice to Lessee and take  possession  of any or all of the
Equipment and, for such purpose (and to the extent permitted by applicable law),
enter upon any premises where the Equipment is located with or without notice or
process of law and free from all claims by Lessee, or require Lessee to assemble
the  Equipment  and deliver it to Lessor in  accordance  with  Section  3.3; (c)
recover any and all direct and  incidental  damages,  including  all accrued and
unpaid Rent and other amounts owing under any Lease,  and (i) for any Lease that
is an FMV Lease,  the Equipment for which has not been returned to Lessor in the
condition required hereunder,  an amount equal to the Casualty Value thereof; or
(ii) for any Lease that is an FMV  Lease,  the  Equipment  for which has been so
returned to Lessor,  such  amounts as are  provided  for the lessee  breach of a
personal  property lease under the Uniform  Commercial Code of the  jurisdiction
specified in Section  5.11 (the  "Code"),  using the Discount  Rate to calculate
present  values  for such  purpose;  or (iii) for any  Lease  that is not an FMV
Lease, an amount equal to the present value, discounted at the Discount Rate, of
the sum of all Rent and other  payments  remaining  to be paid  under such Lease
through the Lease Term plus the applicable  purchase option amount  specified in
Paragraph  7 of  the  Schedule;  and  (d)  sell  or  re-lease  any or all of the
Equipment,  through public or private sale or lease transactions,  and apply the
proceeds  thereof to Lessee's  obligations  under such Leases or otherwise  seek
recovery in accordance  with  applicable  provisions  of the Code.  Lessee shall
remain liable for any resulting  deficiency and Lessor may retain any surplus it
may realize in connection  with an FMV Lease.  The "Discount  Rate" shall be the
rate for U.S. Treasury  obligations  having a constant maturity of three months,
as specified in the Federal  Reserve  Statistical  Release H.15 (or  replacement
publication) issued most recently prior to the date of termination of the Lease.
Lessee shall pay all costs and expenses (including  reasonable  attorneys' fees)
reasonably incurred by Lessor in retaking possession of, and removing,  storing,
repairing,  refurbishing and selling or leasing such Equipment and enforcing any
obligations of Lessee pursuant to any Lease.

                                5. MISCELLANEOUS
                                   -------------

         5.1    Performance of Lessee's  Obligations.  Upon Lessee's failure  to
pay any amount or perform any obligation  under any Lease when due, Lessor shall
have the right,  but shall not be  obligated,  to pay such sum or  perform  such
obligation,  whereupon such sum or cost of such  performance  shall  immediately
become due and payable  thereunder,  with  interest  thereon at the Default Rate
from the date such payment or performance was made.

         5.2    Right to Use. So long as no Event  of  Default  exists,  neither
Lessor nor its assignee shall interfere with Lessee's right to use the Equipment
under any Lease.

         5.3    Assignment by Lessor.   Lessor may assign or transfer any or all
of Lessor's  interest in this Agreement,  any Lease, any Equipment or Rents that
does not purport to change the substantive terms of this Agreement or any Lease,
without  notice to Lessee.  Any assignee of Lessor shall have all of the rights,
but  none  of the  obligations  (unless  otherwise  provided  in the  applicable
assignment),  of a  "Lessor"  under  this  Agreement  and the  applicable  Lease

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(except,  however,  that any  assignee  of the Lessor  will  assume  obligations
relating   entirely  to   transactions   under  each  Lease  which  occur  after
assignment),  and Lessee agrees that it will not assert against any assignee any
defense,  counterclaim  or offset  that  Lessee may have  against  Lessor or any
preceding assignee, and that upon notice of such assignment or transfer, it will
pay all Rent and other sums due under this Agreement and the applicable Lease to
such assignee or transferee. Lessee acknowledges that any assignment or transfer
by Lessor shall not materially  change Lessee's duties or obligations under this
Agreement or any Lease, nor materially  increase the burdens or risks imposed on
Lessee.

         5.4    Further  Assurances.  Upon the request of Lessor  from  time  to
time,  Lessee  shall  execute and deliver  such  further  documents  and do such
further acts as Lessor may be  reasonably  required or  appropriate  to fully to
effect the  purposes of this  Agreement  or any Lease.  Lessee  hereby  appoints
Lessor its attorney in fact, coupled with an interest,  authorized,  without any
obligation  to do so,  (a) to sign on  Lessee's  behalf  and  file,  record  and
register financing statements, and amendments and continuations thereof, and any
other  documents  relating to liens,  security  interests or property  rights of
Lessor or Lessee  with  respect to any  Equipment  and  ancillary  property,  in
accordance with any Uniform  Commercial Code or other code or statute  (provided
that such "other  documents"  must be reasonably  necessary to protect  Lessor's
contract  expectancies under the Lease), and (b) to enforce,  in its own name or
in the name of  Lessee,  claims  relating  to any  Equipment  against  insurers,
manufacturers  or other persons,  and to make,  adjust,  settle,  compromise and
receive  payments as to such  claims.  Upon request of Lessee from time to time,
Lessor shall respond to reasonable  requests for information  from Lessee or its
auditors  concerning  outstanding  or  terminated  Leases with Lessee,  and will
prepare and sign such documents relating to this Agreement to the extent that it
is otherwise  lawfully  obligated to do so (including,  but not limited to UCC-3
Termination  Statements  relating  to  specific  Leases  after  Lessee has fully
performed  all its  obligations  under such  Leases),  provided,  however,  that
Lessor's failure to fully or timely perform its obligations  hereunder shall not
be deemed to be a material  breach of its  obligations  under this  Agreement or
under any Lease.

         5.5    Rights and Remedies.  Each right and remedy  granted  under  any
Lease shall be cumulative and in addition to any other right or remedy  existing
in equity, at law, by virtue of statute or otherwise,  and may be exercised from
time to time concurrently or independently and as often and in such order as the
enforcing  party  may  elect.  Any  failure  or delay on the part of  Lessor  in
exercising any such right or remedy shall not operate as a waiver thereof.

         5.6    Notices. Any  notice,  request,  demand,  consent,  approval  or
other communication  provided for or permitted in relation to any Lease shall be
in writing  and shall be  conclusively  deemed to have been  received by a party
hereto on the day it is delivered  to such party at its address,  or received by
the party at such  facsimile  number,  as is set forth in such Lease (or at such
other  addresses or fax numbers  such party shall  specify to the other party in
writing),  or if sent by registered or certified mail, return receipt requested,
on the fifth day after the day on which it is mailed, postage prepaid, addressed
to such party.

         5.7    Section Headings; Interpretation. Section headings are  inserted
for  convenience  of  reference  only and shall not affect any  construction  or
interpretation  of any Lease  Document.  In  interpreting  the provisions of any
Lease  Document,  (a) the term  "including"  is not limiting;  (b) references to
"person" include individuals, corporations and other legal persons and entities;
(c) the singular of defined terms  includes the plural and  vice-versa;  and (d)

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section and  paragraph  references  are to the document in which such  reference
appears, unless the context otherwise requires.

         5.8    Entire Lease.  This Agreement,  together  with the  other  Lease
Documents,  constitute  the entire  agreement  between  Lessor  and Lessee  with
respect to the lease of the Equipment. No waiver or amendment of, or any consent
with  respect to, any  provision of any Lease  Document  shall bind either party
unless set forth in a writing,  specifying such waiver,  consent,  or amendment,
signed by both  parties.  TO THE  EXTENT  PERMITTED  BY  APPLICABLE  LAW AND NOT
OTHERWISE  SPECIFICALLY  GRANTED TO LESSEE IN ANY LEASE DOCUMENT,  LESSEE HEREBY
WAIVES ANY AND ALL RIGHTS OR REMEDIES  CONFERRED UPON A LESSEE UNDER THE CODE OR
ANY OTHER APPLICABLE LAW OR STATUTE,  WITH RESPECT TO A NON-MATERIAL  DEFAULT BY
LESSOR  UNDER THIS  AGREEMENT  OR ANY LEASE.  Each FMV Lease is  intended by the
parties as a "finance lease" under the Code.

         5.9    Severability.  Should any  provision  of any Lease  Document  be
or become invalid,  illegal,  or  unenforceable  under applicable law, the other
provisions of such Lease Document shall not be affected and shall remain in full
force and effect.

         5.10   Attorneys' Fees;  Default Interest; Maximum Rates.  Lessee shall
reimburse Lessor for all reasonable and verifiable charges,  costs, expenses and
attorney's fees reasonably incurred by Lessor (a) in defending or protecting its
interests in the  Equipment,  (b) in the  enforcement  of this  Agreement or any
Lease,  and (c) in any lawsuit or other legal proceeding to which this Agreement
or any Lease gives rise. However, that Lessee has no reimbursement obligation in
the event that (w) Lessee is not in default under the Agreement,  (x) Lessor has
materially  breached  this  Agreement or any Lease,  (y) Lessee has  commenced a
proceeding  against Lessor (which  proceeding is not commenced as a counterclaim
or affirmative defense in response to a proceeding commenced by any Lessor), and
(z) Lessee  prevails in its claim against Lessor  ("prevails"  means that Lessee
has  been  awarded  all  or  substantially  all  of  the  relief  sought  in its
proceeding). Also, Lessee has no reimbursement obligation for the attorneys fees
and costs expended in the  negotiation  and preparation of this Agreement or any
Schedule or related  documents.  Any  nonpayment of Rent or other amount payable
under any Lease shall  result in Lessee's  obligation  to promptly pay Lessor on
such  overdue  payment,  for the  period  of time  during  which  it is  overdue
(including  during any grace period),  interest at a rate ("Default Rate") equal
to fourteen  percent (14%) per annum. To the extent that any payment of interest
(including  any amount deemed imputed  interest for purposes of applicable  law)
under any Lease Document would otherwise  exceed  provisions of any law limiting
the highest rate of interest  that may be lawfully  contracted  for,  charged or
received by Lessor,  such payment  amount shall be deemed reduced to such amount
as is equal to or consistent with the highest rate permitted by applicable law.

         5.11   Governing Law and Jurisdiction.  THIS AGREEMENT  AND  THE  OTHER
LEASE  DOCUMENTS  SHALL BE GOVERNED IN ALL  RESPECTS BY THE LAWS OF THE STATE OF
CALIFORNIA.  LESSOR  AND  LESSEE  WAIVE  ALL  RIGHTS  TO  TRIAL  BY  JURY IN ANY
LITIGATION ARISING FROM ANY LEASE DOCUMENT. LESSEE CONSENTS TO THE NON-EXCLUSIVE

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JURISDICTION  OF THE STATE  COURTS AND THE  FEDERAL  COURTS  LOCATED IN NEW YORK
CITY, NEW YORK, FOR THE RESOLUTION OF ANY DISPUTES UNDER ANY LEASE DOCUMENT.

         5.12   Survival.  All obligations  of Lessee to make payments to Lessor
under any Lease or to indemnify Lessor, including pursuant to Section 3.4 or 3.7
above,  with respect to a Lease, and all rights of Lessor hereunder with respect
to a Lease,  shall survive the  termination  of such Lease and the return of the
Equipment.

         5.13   Security. To secure the payment and performance by Lessee of all
obligations under each Lease, Lessee hereby grants Lessor a security interest in
Lessee's right, title and interest,  now existing and hereafter arising,  in and
to, (a) all Equipment subject to such Lease, (b) all insurance, warranty, rental
and other  claims and rights to payment  and chattel  paper  arising out of such
Equipment, and (c) all books, records and proceeds relating to the foregoing.

         5.14   Counterparts; Chattel Paper. Each Lease Document may be executed
in counterparts,  and when so executed each counterpart shall be deemed to be an
original,  and such  counterparts  together  shall  constitute  one and the same
instrument.  The original of each Schedule  shall  constitute  chattel paper for
purposes of the Code. If there exist multiple  originals of a Schedule,  the one
marked  "Lessor's  Copy" or words of similar  import,  shall be the only chattel
paper.

         5.15   Appendix.  Any lease Appendix  executed  by  Lessor  and  Lessee
making  reference  to this  Agreement  is a part of and  incorporated  into this
Agreement by this reference.

         5.16   No Obligation to  Purchase  or  Lease  Equipment;  Non-Exclusive
Relationship.  Nothing in this Agreement shall impose upon Lessee any obligation
to purchase or lease any equipment from Vendor, Lessor or any other person prior
to its execution of a Purchase  Order.  Also,  nothing in this  Agreement  shall
impose upon Lessor any  obligation  to either  enter into any lease  transaction
prior to its  delivery  of a Schedule  or to  prepare  or deliver a Schedule  to
Lessee when  presented  with a Purchase  Order (whether in draft or final form).
Lessee's relationship with Lessor is non-exclusive, and provided that Lessee has
not  agreed or deemed to have  agreed  to enter  into a lease  transaction  with
Lessor or to otherwise execute a Schedule,  Lessee is free to purchase equipment
subject to such  Purchase  Order  without  leasing  it from  Lessor or any other
party.

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<PAGE>

         EACH PARTY,  BY THE SIGNATURE  BELOW OF ITS AUTHORIZED  REPRESENTATIVE,
ACKNOWLEDGES  THAT IT HAS READ THIS AGREEMENT,  UNDERSTANDS IT, AND AGREES TO BE
BOUND BY ITS TERMS AND CONDITIONS.  EACH PERSON SIGNING BELOW REPRESENTS THAT HE
OR SHE IS AUTHORIZED  TO EXECUTE AND DELIVER THIS  AGREEMENT ON BEHALF OF HIS OR
HER RESPECTIVE PARTY.



LESSOR:                                           LESSEE:

CISCO SYSTEMS CAPITAL CORPORATION                 VDC TELECOMMUNICATIONS

By:  /s/ John F. Linford                          By:  /s/ Frederick A. Moran
     -----------------------                           ----------------------
     (Authorized Signature)                            (Authorized Signature)


Servicing Operations Manager                      President
----------------------------                      ---------------------------
     (Name/Title)                                 (Name/Title)



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