EXHIBIT 10.1



                          SECURITIES PURCHASE AGREEMENT


         SECURITIES PURCHASE AGREEMENT (this "AGREEMENT"), dated as of March 15,
2000,  by and among  eGlobe,  Inc., a Delaware  corporation,  with  headquarters
located at 1250 24th Street, NW, Suite 725, Washington, DC 20037 ("COMPANY") and
each of the purchasers set forth on the signature pages hereto (the "BUYERS").

         WHEREAS:

         A. The  Company  and the  Buyers  are  executing  and  delivering  this
Agreement in reliance upon the exemption from securities  registration  afforded
by Rule 506 under  Regulation D  ("REGULATION  D") as  promulgated by the United
States  Securities and Exchange  Commission (the "SEC") under the Securities Act
of 1933, as amended (the "1933 ACT");

         B.  The  Company  has  authorized  a new  series  of  preferred  stock,
designated  as Series Q  Convertible  Preferred  Stock (the  "SERIES Q PREFERRED
STOCK"),  having  the  rights,  preferences  and  privileges  set  forth  in the
Certificate of Designations,  Rights and Preferences  attached hereto as EXHIBIT
"A" (the  "CERTIFICATE OF  DESIGNATION")  and has authorized the issuance to the
Buyers of an  aggregate of Ten  Thousand  (10,000)  shares of Series Q Preferred
Stock  (together  with  any  shares  of  Series  Q  Preferred  Stock  issued  in
replacement  thereof or as a dividend  thereon or otherwise with respect thereto
in accordance with the terms thereof, the "PREFERRED SHARES");

         C. The Series Q Preferred  Stock is  convertible  into shares of common
stock, $.001 par value per share, of the Company (the "COMMON STOCK"),  upon the
terms and subject to the limitations and conditions set forth in the Certificate
of Designation;

         D. The Company has  authorized  the issuance to the Buyers of warrants,
in the form attached  hereto as EXHIBIT  "B-1",  to purchase an aggregate of One
Hundred Thousand (100,000) shares of Common Stock (the "FIRST CLOSING WARRANTS")
and  warrants,  in the form  attached  hereto as EXHIBIT  "B-2",  to purchase an
aggregate of One Hundred Fifty  Thousand  (150,000)  shares of Common Stock (the
"SECOND CLOSING  WARRANTS" and,  together with the First Closing  Warrants,  the
"WARRANTS").  The shares of Common Stock  issuable upon exercise of or otherwise
pursuant to the  Warrants are  referred to herein  collectively  as the "WARRANT
SHARES."

         E. The Buyers  desire to purchase and the Company  desires to issue and
sell,  upon  the  terms  and  conditions  set  forth in this  Agreement,  (i) an
aggregate of Ten Thousand (10,000)  Preferred Shares and (ii) the Warrants,  for
an aggregate purchase price of Ten Million Dollars ($10,000,000);

         F. Each Buyer wishes to purchase,  upon the terms and conditions stated
in this Agreement,  the number of Preferred  Shares and Warrants as is set forth
immediately below its name on the signature pages hereto; and
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         G.  Contemporaneous  with the execution and delivery of this Agreement,
the parties hereto are executing and delivering a Registration Rights Agreement,
in  the  form  attached  hereto  as  EXHIBIT  "C"  (the   "REGISTRATION   RIGHTS
AGREEMENT"),  pursuant  to which  the  Company  has  agreed to  provide  certain
registration rights under the 1933 Act and the rules and regulations promulgated
thereunder, and applicable state securities laws.

         NOW,  THEREFORE,  the Company and each of the Buyers severally (and not
jointly) hereby agree as follows:


         1. PURCHASE AND SALE OF PREFERRED SHARES AND WARRANTS.

                  a. PURCHASE OF PREFERRED SHARES AND WARRANTS.  On each Closing
Date (as defined below), the Company shall issue and sell to each Buyer and each
Buyer  severally  agrees to purchase  from the Company  such number of Preferred
Shares and  Warrants  for the  aggregate  purchase  price  with  respect to such
applicable  Closing (as defined  below) as is set forth  immediately  below such
Buyer's name on the signature pages hereto.  The issuance,  sale and purchase of
the Preferred  Shares and Warrants shall take place at two (2) closings (each, a
"CLOSING"), the first of which is hereinafter referred to as the "FIRST CLOSING"
and the second of which is referred to as the "SECOND  CLOSING."  The  aggregate
number of Preferred  Shares to be issued at the First  Closing is Four  Thousand
(4,000) for an aggregate  purchase  price of Four Million  Dollars  ($4,000,000)
(the "FIRST  CLOSING  PURCHASE  PRICE") and the  aggregate  number of  Preferred
Shares  to be  issued at the  Second  Closing  is Six  Thousand  (6,000)  for an
aggregate  purchase  price of Six  Million  Dollars  ($6,000,000)  (the  "SECOND
CLOSING PURCHASE PRICE" and, collectively with the First Closing Purchase Price,
the  "PURCHASE  PRICE "). The aggregate  number of First Closing  Warrants to be
issued  at the First  Closing  is  100,000  and the  aggregate  number of Second
Closing  Warrants to be issued at the Second Closing is 150,000.  Subject to the
satisfaction  (or waiver) of the  conditions  thereto set forth in Section 6 and
Section 7 below,  (i) at the First Closing,  the Company shall issue and sell to
each  Buyer  and each  Buyer  shall  purchase  from the  Company  the  number of
Preferred  Shares and First  Closing  Warrants  which  such Buyer is  purchasing
hereunder and as set forth below such Buyer's name on the signature pages hereto
and (ii) at the Second  Closing,  the Company shall issue and sell to each Buyer
and each Buyer shall  purchase  from the Company the number of Preferred  Shares
and Second  Closing  Warrants  as is set forth  below such  Buyer's  name on the
signature pages hereto.

                  b. FORM OF PAYMENT.  On each Closing Date (as defined  below),
(i) each Buyer shall pay the applicable  Purchase Price for the Preferred Shares
and  Warrants  to be issued  and sold to it at the  applicable  Closing  by wire
transfer of immediately  available funds to the Company,  in accordance with the
Company's  written  wiring  instructions,  against  delivery  of  duly  executed
certificates  representing  such number of Preferred  Shares and Warrants  which
such Buyer is purchasing  and (ii) the Company  shall deliver such  certificates
duly executed on behalf of the Company, to such Buyer,  against delivery of such
applicable Purchase Price.

                  c. CLOSING DATE.  Subject to the  satisfaction  (or waiver) of
the conditions  thereto set forth in Section 6 and Section 7 below, the date and
time of the issuance and sale of the Preferred Shares pursuant to this Agreement
(each, a "CLOSING  DATE") shall be (i) in the case of the First  Closing,  12:00
noon  Eastern  Standard  Time on March  15,  2000 and (ii) in

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the case of Second Closing, as soon as practicable (but no later than 12:00 noon
Eastern   Standard  Time  on  the  fifth  (5th)   business  day)  following  the
satisfaction  (or waiver) of the  conditions to the Second  Closing set forth in
Sections 6 and 7 below,  but in no event shall the Second  Closing take place if
the  conditions  set forth in Sections 6 and 7 are not satisfied or waived prior
to July 15, 2000 or, in each case,  such other mutually  agreed upon time.  Each
closing  shall occur on the  applicable  Closing  Date at the offices of Ballard
Spahr Andrews & Ingersoll, LLP, 1735 Market Street,  Philadelphia,  Pennsylvania
19103, or at such other location as may be agreed to by the parties. The parties
may  close the  transactions  contemplated  by this  Agreement  by  transmitting
signature  pages  and  copies  of other  documents  via  facsimile  followed  by
overnight delivery and exchange of the originally executed documents.

         2. BUYERS'  REPRESENTATIONS  AND WARRANTIES.  Each Buyer severally (and
not  jointly)  represents  and  warrants to the Company  solely as to such Buyer
that:

                  a.  INVESTMENT  PURPOSE.  As of the date hereof,  the Buyer is
purchasing  the  Preferred  Shares,  the shares of Common  Stock  issuable  upon
conversion of or otherwise pursuant to the Preferred Shares (including,  without
limitation,  such additional  shares of Common Stock as are issuable as a result
of the events  described  in Articles V, VI.D(b) or VI.E of the  Certificate  of
Designation and Section 2(c) of the  Registration  Rights Agreement (such shares
of Common  Stock  being  collectively  referred  to  herein  as the  "CONVERSION
SHARES")), the Warrants and the shares of Common Stock issuable upon exercise of
or otherwise  pursuant to the Warrants (the "WARRANT  SHARES" and,  collectively
with  the  Preferred  Shares,  the  Conversion  Shares  and  the  Warrants,  the
"SECURITIES") for its own account and not with a present view towards the public
sale or distribution thereof within the meaning of the 1933 Act, except pursuant
to sales registered or exempted from registration  under the 1933 Act; provided,
however, that by making the representations  herein, the Buyer does not agree to
hold any of the  Securities  for any minimum or other specific term and reserves
the  right  to  dispose  of the  Securities  at any time in  accordance  with or
pursuant to a effective  registration statement or an applicable exemption under
the 1933 Act.

                  b.  ACCREDITED  INVESTOR  STATUS.  The Buyer is an "accredited
investor"  as that term is defined in Rule 501(a) of  Regulation  D  promulgated
under the 1933 Act (an "ACCREDITED INVESTOR").

                  c.  RELIANCE ON  EXEMPTIONS.  The Buyer  understands  that the
Securities are being offered and sold to it in reliance upon specific exemptions
from the registration requirements of United States federal and state securities
laws and that the  Company is relying  upon the truth and  accuracy  of, and the
Buyer's   compliance   with,  the   representations,   warranties,   agreements,
acknowledgments  and  understandings  of the Buyer set forth  herein in order to
determine the  availability  of such exemptions and the eligibility of the Buyer
to acquire the Securities.

                  d. INFORMATION.  The Buyer and its advisors, if any, have been
furnished with all materials  relating to the business,  finances and operations
of the Company and  materials  relating to the offer and sale of the  Securities
which  have  been  requested  by the  Buyer or its  advisors.  The Buyer and its
advisors,  if any,  have been afforded the  opportunity  to ask questions of the
Company.  Neither  such  inquiries  nor any  other due  diligence  investigation
conducted by Buyer or any of its advisors or representatives shall modify, amend
or affect Buyer's right to rely on the Company's  representations and warranties
contained in Section 3

<PAGE>

below. The Buyer  understands  that its investment in the Securities  involves a
significant degree of risk.

                  e. GOVERNMENTAL  REVIEW.  The Buyer understands that no United
States federal or state agency or any other  government or  governmental  agency
has passed upon or made any recommendation or endorsement of the Securities.

                  f. TRANSFER OR RE-SALE.  The Buyer understands that (i) except
as provided in the  Registration  Rights  Agreement,  the sale or re-sale of the
Securities  has not been and is not being  registered  under the 1933 Act or any
applicable  state  securities  laws,  and the  Securities may not be transferred
unless  (a) the  Securities  are  sold  pursuant  to an  effective  registration
statement  under the 1933 Act, (b) the Buyer shall have delivered to the Company
an opinion of  counsel  (which  opinion  shall be in form,  substance  and scope
customary for opinions of counsel in comparable transactions) to the effect that
the Securities to be sold or transferred may be sold or transferred  pursuant to
an exemption from such registration,  (c) the Securities are sold or transferred
to an "affiliate" (as defined in Rule 144  promulgated  under the 1933 Act (or a
successor  rule)  ("Rule  144")) of the Buyer  who  agrees to sell or  otherwise
transfer the Securities  only in accordance with this Section 2(f) and who is an
Accredited  Investor or (d) the  Securities  are sold pursuant to Rule 144; (ii)
any sale of such  Securities  made in  reliance  on Rule 144 may be made only in
accordance  with  the  terms  of said  Rule  and  further,  if said  Rule is not
applicable,  any re-sale of such  Securities  under  circumstances  in which the
seller  (or the  person  through  whom the sale is made)  may be deemed to be an
underwriter  (as that term is  defined in the 1933 Act) may  require  compliance
with some other exemption under the 1933 Act or the rules and regulations of the
SEC thereunder;  and (iii) neither the Company nor any other person is under any
obligation  to  register  such  Securities  under  the  1933  Act or  any  state
securities  laws or to comply  with the terms and  conditions  of any  exemption
thereunder  (in each  case,  other  than  pursuant  to the  Registration  Rights
Agreement).  Notwithstanding  the foregoing or anything else contained herein to
the contrary,  the Securities may be pledged as collateral in connection  with a
bona fide margin account or other lending arrangement.

                  g. LEGENDS.  The Buyer  understands  that the Preferred Shares
and Warrants and,  until such time as the  Conversion  Shares and Warrant Shares
have been  registered  under the 1933 Act as  contemplated  by the  Registration
Rights  Agreement  or  otherwise  may be sold  pursuant  to Rule 144 without any
restriction as to the number of securities as of a particular date that can then
be  immediately  sold,  the  Conversion  Shares and Warrant  Shares,  may bear a
restrictive  legend in  substantially  the following  form (and a  stop-transfer
order may be placed with the Company's  transfer  agent against  transfer of the
certificates for such Securities):

                  "The securities  represented by this certificate have not been
                  registered  under the Securities Act of 1933, as amended.  The
                  securities  may not be sold,  transferred  or  assigned in the
                  absence  of  an  effective   registration  statement  for  the
                  securities under said Act, or an opinion of counsel,  in form,
                  substance  and scope  customary  for  opinions  of  counsel in
                  comparable  transactions,  that  registration  is not required
                  under said Act or unless sold  pursuant to Rule 144 under said
                  Act."

         The legend set forth above shall be removed and the Company shall issue
or caused to be issued a  certificate  without  such legend to the holder of any
Security upon which it

<PAGE>

is stamped,  if, unless otherwise  required by applicable state securities laws,
(a) such  Security  is  registered  for sale  under  an  effective  registration
statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144
without any  restriction as to the number of securities as of a particular  date
that can then be immediately  sold, or (b) such holder provides the Company with
an opinion of counsel,  in form,  substance and scope  customary for opinions of
counsel in comparable transactions, to the effect that a public sale or transfer
of such  Security may be made without  registration  under the 1933 Act and such
sale or  transfer is  effected,  or (c) such holder  provides  the Company  with
reasonable  assurances  that such Security can be sold pursuant to Rule 144. The
Buyer  agrees  to  sell  all  Securities,   including  those  represented  by  a
certificate(s)  from which the  legend  has been  removed,  in  compliance  with
applicable securities laws and prospectus delivery requirements, if any.

                  h. AUTHORIZATION; ENFORCEMENT. (i) The Buyer has all requisite
power,  capacity and authority to enter into and perform this  Agreement and the
Registration  Rights Agreement and to consummate the  transactions  contemplated
hereby and thereby,  (ii) the execution  and delivery of this  Agreement and the
Registration  Rights  Agreement,   and  the  consummation  of  the  transactions
contemplated  hereby and thereby  have been duly and validly  authorized  by the
Buyer,  and (iii) this  Agreement has been duly executed and delivered on behalf
of the Buyer, and this Agreement constitutes, and upon execution and delivery by
the Buyer of the Registration Rights Agreement,  such agreement will constitute,
valid and binding  agreements of the Buyer  enforceable in accordance with their
terms.

                  i. RESIDENCY.  The Buyer is a resident of the jurisdiction set
forth immediately below such Buyer's name on the signature pages hereto.

                  j. NO CONFLICTS.  The execution,  delivery and  performance of
this  Agreement  and the  Registration  Rights  Agreement  by the  Buyer and the
consummation by the Buyer of the  transactions  contemplated  hereby and thereby
will not (i) if the Buyer is an entity,  conflict  with or result in a violation
of  any  provision  of  the  certificate  of  incorporation,   bylaws  or  other
organizational  documents of the Buyer, (ii) violate or conflict with, or result
in a breach of any provision of, or constitute a default (or an event which with
notice or lapse of time or both could become a default)  under any  agreement to
which the Buyer is a party,  or (iii) result in the violation of any law,  rule,
regulation,  order,  judgment or decree  applicable  to the Buyer.  There are no
agreements, laws or other restrictions of any kind to which the Buyer is a party
or is subject  that  would  prevent  or  restrict  the  execution,  delivery  or
performance of this Agreement by the Buyer.

         3.   REPRESENTATIONS  AND  WARRANTIES  OF  THE  COMPANY.   The  Company
represents and warrants to each Buyer that:

                  a. ORGANIZATION AND QUALIFICATION. The Company and each of its
Subsidiaries  (as defined  below),  if any,  is a  corporation  duly  organized,
validly  existing and in good  standing  under the laws of the  jurisdiction  in
which it is incorporated, with full power and authority (corporate and other) to
own,  lease,  use and operate its properties and to carry on its business as and
where now owned, leased, used, operated and conducted.  SCHEDULE 3(a) sets forth
a list of all of the  Subsidiaries of the Company and the  jurisdiction in which
each is incorporated. The Company and each of its Subsidiaries is duly qualified
as a  foreign  corporation  to do  business  and is in good  standing  in  every
jurisdiction  in which its  ownership  or use of  property  or the nature of the
business  conducted by it makes such  qualification  necessary

<PAGE>

except where the failure to be so qualified or in good standing would not have a
Material  Adverse Effect.  "MATERIAL  ADVERSE EFFECT" means any material adverse
effect on (i) the Securities, (ii) the business,  operations,  assets, financial
condition or prospects of the Company and its  Subsidiaries,  if any, taken as a
whole, or (iii) on the transactions  contemplated hereby or by the agreements or
instruments to be entered into in connection herewith.  "SUBSIDIARIES" means any
corporation or other organization,  whether  incorporated or unincorporated,  in
which the Company owns,  directly or indirectly,  any equity or other  ownership
interest.

                  b.  AUTHORIZATION;   ENFORCEMENT.  (i)  The  Company  has  all
requisite  corporate  power and  authority  to file and perform its  obligations
under  the  Certificate  of  Designation  and to  enter  into and  perform  this
Agreement,  the Registration Rights Agreement and the Warrants and to consummate
the transactions contemplated hereby and thereby and to issue the Securities, in
accordance with the terms hereof and thereof, (ii) the execution and delivery of
this  Agreement,  the  Registration  Rights  Agreement  and the  Warrants by the
Company and the consummation by it of the transactions  contemplated  hereby and
thereby (including without limitation,  the issuance of the Preferred Shares and
the Warrants and the issuance  and  reservation  for issuance of the  Conversion
Shares and the  Warrant  Shares  issuable  upon  conversion  or  exercise  of or
otherwise  pursuant to the  Preferred  Shares and the  Warrants)  have been duly
authorized  by the  Company's  Board of  Directors  and no  further  consent  or
authorization  of the Company,  its Board of Directors,  or its  stockholders is
required,  (iii) this  Agreement  has been duly  executed  and  delivered by the
Company, and (iv) this Agreement constitutes and, upon execution and delivery by
the Company of the  Registration  Rights  Agreement  and the  Warrants  and upon
execution and filing of the Certificate of Designation,  each of such agreements
and instruments will constitute,  a legal,  valid and binding  obligation of the
Company enforceable against the Company in accordance with its terms.

                  c. CAPITALIZATION. The authorized capital stock of the Company
consists  of: (a) one hundred  million  (100,000,000)  shares of Common Stock of
which  forty-six  million,  eight  hundred fifty  thousand,  seven hundred forty
(46,850,740)  shares were issued and  outstanding  as of March 15, 2000; and (b)
ten million  (10,000,000)  shares of preferred stock, par value $.001 per share,
of which, as of March 15, 2000: (i) one hundred  twenty-five  (125) shares of 8%
Series E Cumulative Convertible Redeemable Preferred Stock are authorized,  none
of which are outstanding; (ii) two million twenty thousand (2,020,000) shares of
Series  F  Convertible  Preferred  Stock  are  authorized,  none  of  which  are
outstanding;   (iii)  four  hundred  thousand   (400,000)  shares  of  Series  I
Convertible Preferred Stock are authorized,  of which two hundred fifty thousand
(250,000) shares are issued and outstanding; (iv) forty (40) shares of 5% Series
J  Cumulative  Convertible  Preferred  Stock are  authorized,  none of which are
outstanding;  (v) one (1) share of 20% Series M Cumulative Convertible Preferred
Stock is authorized,  issued and outstanding;  (vi) sixteen thousand one hundred
(16,100)  shares of 10%  Series O  Cumulative  Convertible  Preferred  Stock are
authorized,  issued and outstanding;  and (vii) fifteen thousand (15,000) shares
of Series P  Convertible  Preferred  Stock  ("SERIES  P  PREFERRED  STOCK")  are
authorized,  issued and  outstanding.  In  addition,  (i)  3,250,000  shares are
reserved for issuance pursuant to Company stock options,  (ii) 21,497,988 shares
are reserved  for  issuance  pursuant to  securities  (other than the  Preferred
Shares and the Warrants)  exercisable  for, or convertible  into or exchangeable
for shares of Common Stock (which amount  includes  10,921,464  shares  issuable
upon conversion of shares of preferred stock  (excluding the Preferred  Shares),
7,322,357 shares issuable upon exercise of non-contingent warrants and 3,254,167
shares issuable upon exercise of contingent  warrants),  (iii) 6,000,000  shares
are reserved for issuance  upon  conversion  of the shares of Series P Preferred
Stock and exercise of the warrants  issued

<PAGE>

pursuant to that certain  Securities  Purchase Agreement dated as of January 26,
2000 by and  between the Company and the Buyers  named  therein  (the  "SERIES P
AGREEMENT") and (iv) 4,000,000  shares are reserved for issuance upon conversion
of the  Preferred  Shares and  exercise of the Warrants  (subject to  adjustment
pursuant to the Company's covenant set forth in Section 4(h) below). All of such
outstanding  shares  of  capital  stock  are,  or upon  issuance  will be,  duly
authorized,  validly issued, fully paid and nonassessable.  No shares of capital
stock of the  Company  are  subject to  preemptive  rights or any other  similar
rights of the  stockholders of the Company or any liens or encumbrances  imposed
through the actions or failure to act of the  Company.  Except as  disclosed  in
SCHEDULE  3(c), as of the  effective  date of this  Agreement,  (i) there are no
outstanding  options,  warrants,  scrip,  rights to subscribe for, puts,  calls,
rights of first refusal, agreements, understandings, claims or other commitments
or rights of any  character  whatsoever  relating  to, or  securities  or rights
convertible  into or exchangeable for any shares of capital stock of the Company
or any of its  Subsidiaries,  or arrangements by which the Company or any of its
Subsidiaries is or may become bound to issue additional  shares of capital stock
of the  Company  or any of its  Subsidiaries,  (ii) there are no  agreements  or
arrangements  under which the Company or any of its Subsidiaries is obligated to
register the sale of any of its or their  securities  under the 1933 Act (except
the Registration Rights Agreement) and (iii) there are no anti-dilution or price
adjustment provisions contained in any security issued by the Company (or in any
agreement  providing  rights to security  holders) that will be triggered by the
issuance of the Preferred  Shares,  the Conversion  Shares,  the Warrants or the
Warrant  Shares.  The Company has furnished to the Buyer true and correct copies
of the Company's  Certificate of  Incorporation  (including all  certificates of
designation  of the rights,  preferences,  privileges  and  restrictions  of the
various  existing  series of preferred stock of the Company) as in effect on the
date hereof (the "CERTIFICATE OF  INCORPORATION"),  the Company's By-laws, as in
effect on the date  hereof  (the  "BY-LAWS"),  and the  terms of all  securities
convertible into or exercisable for Common Stock of the Company and the material
rights of the holders thereof in respect thereto.  The Company shall provide the
Buyer with a written update of this representation signed by the Company's Chief
Executive  or  Chief  Financial  Officer  on  behalf  of the  Company  as of the
applicable Closing Date.

                  d. ISSUANCE OF SHARES.  The Preferred  Shares and the Warrants
are duly  authorized  and, upon  issuance in  accordance  with the terms of this
Agreement, will be validly issued, fully paid and non-assessable,  and free from
all taxes,  liens, claims and encumbrances with respect to the issue thereof and
shall  not  be  subject  to  preemptive   rights  or  other  similar  rights  of
stockholders  of the Company  and will not impose  personal  liability  upon the
holder thereof. The Conversion Shares and the Warrant Shares are duly authorized
and reserved for issuance  and,  upon  conversion  of the  Preferred  Shares and
exercise of the Warrants in accordance  with the terms thereof,  will be validly
issued,  fully paid and  non-assessable,  and free from all taxes, liens, claims
and encumbrances with respect to the issuance thereof and will not be subject to
preemptive  rights or other similar  rights of  stockholders  of the Company and
will not impose personal liability upon the holder thereof.

                  e.  ACKNOWLEDGMENT  OF DILUTION.  The Company  understands and
acknowledges  the  potentially  dilutive  effect to the  Common  Stock  upon the
issuance of the Conversion  Shares upon  conversion of or otherwise  pursuant to
the Preferred Shares and upon issuance of the Warrant Shares upon exercise of or
otherwise  pursuant to the  Warrants.  The  Company's  directors  and  executive
officers have studied and fully  understand the nature of the  Securities  being
sold hereunder.  The Company further  acknowledges  that its obligation to issue
Conversion  Shares upon  conversion  of or otherwise  pursuant to the  Preferred
Shares and

<PAGE>

Warrant  Shares  upon  exercise  of or  otherwise  pursuant  to the  Warrants in
accordance with this Agreement,  the Certificate of Designation and the Warrants
is  absolute  and  unconditional  regardless  of the  dilutive  effect that such
issuance  may  have on the  ownership  interests  of other  stockholders  of the
Company. Taking the foregoing into account, the Company's Board of Directors has
determined,  in its good  faith  business  judgment,  that the  issuance  of the
Preferred  Shares,  the Conversion  Shares,  the Warrants and the Warrant Shares
hereunder and under the Certificate of Designation  and the  consummation of the
transactions  contemplated  hereby and thereby  are in the best  interest of the
Company and its stockholders.

                  f. SERIES OF PREFERRED STOCK. The terms, designations, powers,
preferences and relative,  participating and optional or special rights, and the
qualifications,  limitations and  restrictions of each series of preferred stock
of  the  Company  (other  than  the  Preferred  Shares)  are  as  stated  in the
Certificate  of  Incorporation,  filed on or prior to the date  hereof,  and the
Bylaws. The terms, designations, powers, preferences and relative, participating
and  optional  or  special  rights,  and  the  qualifications,  limitations  and
restrictions  of the  Preferred  Shares  are as  stated  in the  Certificate  of
Designation.

                  g. NO CONFLICTS.  The execution,  delivery and  performance of
this  Agreement,  the  Registration  Rights  Agreement  and the  Warrants by the
Company and the  consummation  by the Company of the  transactions  contemplated
hereby and thereby (including, without limitation, the filing of the Certificate
of Designation and the issuance and reservation for issuance, as applicable,  of
the Preferred Shares,  Conversion Shares,  Warrants and Warrant Shares) will not
(i) conflict with or result in a violation of any  provision of the  Certificate
of  Incorporation  or By-laws or (ii) violate or conflict  with,  or result in a
breach of any  provision  of, or  constitute  a default  (or an event which with
notice or lapse of time or both could become a default) under, or give to others
any rights of  termination,  amendment,  acceleration  or  cancellation  of, any
agreement,  indenture, patent, patent license or instrument to which the Company
or any of its  Subsidiaries  is a party,  or (iii)  result in a violation of any
law, rule,  regulation,  order,  judgment or decree (including federal and state
securities  laws  and   regulations  and  regulations  of  any   self-regulatory
organizations to which the Company or its securities are subject)  applicable to
the Company or any of its  Subsidiaries or by which any property or asset of the
Company  or any of its  Subsidiaries  is  bound  or  affected  (except  for such
conflicts, defaults, terminations, amendments, accelerations,  cancellations and
violations  as would  not,  individually  or in the  aggregate,  have a Material
Adverse Effect). Neither the Company nor any of its Subsidiaries is in violation
of its Certificate of Incorporation,  By-laws or other organizational  documents
and neither the Company nor any of its  Subsidiaries is in default (and no event
has occurred which with notice or lapse of time or both could put the Company or
any of its  Subsidiaries in default)  under,  and neither the Company nor any of
its  Subsidiaries  has taken any action or failed to take any action  that would
give  to  others  any  rights  of   termination,   amendment,   acceleration  or
cancellation of, any agreement,  indenture or instrument to which the Company or
any of its  Subsidiaries  is a party or by which any  property  or assets of the
Company or any of its  Subsidiaries  is bound or  affected,  except for possible
defaults as would not, individually or in the aggregate, have a Material Adverse
Effect.  The  businesses  of the Company and its  Subsidiaries,  if any, are not
being  conducted,  and shall not be conducted so long as a Buyer owns any of the
Securities, in violation of any law, ordinance or regulation of any governmental
entity,  except where such conduct would not,  individually or in the aggregate,
have a Material  Adverse  Effect.  Except as  specifically  contemplated by this
Agreement and as required under the 1933 Act and any applicable state securities
laws, the Company is not required to obtain any consent,  authorization or order
of, or make any filing or  registration  with,

<PAGE>

any court,  governmental agency, regulatory agency, self regulatory organization
or stock  market  or any  third  party in order for it to  execute,  deliver  or
perform any of its obligations  under this Agreement,  the  Registration  Rights
Agreement or the Warrants in  accordance  with the terms hereof or thereof or to
issue and sell the  Preferred  Shares and the  Warrants in  accordance  with the
terms hereof and to issue the Conversion  Shares upon conversion of or otherwise
pursuant  to the  Preferred  Shares and the Warrant  Shares upon  exercise of or
otherwise  pursuant to the Warrants.  Except as disclosed in SCHEDULE  3(g), all
consents, authorizations, orders, filings and registrations which the Company is
required to obtain  pursuant to the  preceding  sentence  have been  obtained or
effected on or prior to the date hereof.  The Company is not in violation of the
listing  requirements  of the Nasdaq  National  Market  ("NASDAQ")  and does not
reasonably  anticipate  that the Common  Stock will be delisted by the Nasdaq in
the  foreseeable  future.  The Company and its  Subsidiaries  are unaware of any
facts or circumstances which might give rise to any of the foregoing.

                  h. SEC DOCUMENTS; FINANCIAL STATEMENTS. Except as set forth on
SCHEDULE  3(h),  since  December  31,  1997,  the Company  has timely  filed all
reports,  schedules,  forms, statements and other documents required to be filed
by it with the SEC  pursuant to the  reporting  requirements  of the  Securities
Exchange Act of 1934,  as amended (the "1934 ACT") (all of the  foregoing  filed
prior to the  date  hereof  and all  exhibits  included  therein  and  financial
statements  and  schedules  thereto and  documents  (other than exhibits to such
documents)  incorporated by reference  therein,  being  hereinafter  referred to
herein as the "SEC  DOCUMENTS").  The Company has made  available  to each Buyer
true and  complete  copies of the SEC  Documents,  except for such  exhibits and
incorporated documents. As of their respective dates, the SEC Documents complied
as to form in all material respects with the applicable requirements of the 1934
Act and the rules and regulations of the SEC promulgated  thereunder  applicable
to the SEC Documents, and none of the SEC Documents, at the time they were filed
with the SEC,  contained  any untrue  statement of a material fact or omitted to
state a material  fact  required to be stated  therein or  necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading.  None of the statements made in any such SEC Documents is,
or has been,  required to be amended or updated under applicable law (except for
such  statements as have been amended or updated in subsequent  filings prior to
the date hereof). As of their respective dates, the financial  statements of the
Company  included  in the SEC  Documents  complied  as to  form in all  material
respects with  applicable  accounting  requirements  and the published rules and
regulations of the SEC with respect thereto. Such financial statements have been
prepared  in  accordance  with  United  States  generally  accepted   accounting
principles, consistently applied, during the periods involved (except (i) as may
be otherwise  indicated in such financial  statements or the notes  thereto,  or
(ii) in the case of  unaudited  interim  statements,  to the extent they may not
include footnotes or may be condensed or summary  statements) and fairly present
in all material respects the consolidated  financial position of the Company and
its  consolidated  Subsidiaries  as of the dates  thereof  and the  consolidated
results of their  operations and cash flows for the periods then ended (subject,
in the case of unaudited  statements,  to normal  year-end  audit  adjustments).
Except as set  forth in  SCHEDULE  3(h) or in the  financial  statements  of the
Company  included  in  the  SEC  Documents,  the  Company  has  no  liabilities,
contingent or  otherwise,  other than (i)  liabilities  incurred in the ordinary
course of business  subsequent to December 31, 1998 and (ii)  obligations  under
contracts and  commitments  incurred in the ordinary  course of business and not
required under generally accepted accounting  principles to be reflected in such
financial statements,  which, individually or in the aggregate, are not material
to the financial condition or operating results of the Company.
<PAGE>

                  i.  Absence of Certain  Changes.  Since  December 31, 1998 and
except as set forth in the SEC Documents  filed after such date,  there has been
no material  adverse change and no material  adverse  development in the assets,
liabilities, business, properties, operations, prospects, financial condition or
results of operations of the Company or any of its Subsidiaries.

                  j.  ABSENCE  OF  LITIGATION.  Except as  disclosed  in the SEC
documents  or set forth on  SCHEDULE  3(j),  there is no  action,  suit,  claim,
proceeding,  inquiry  or  investigation  before or by any court,  public  board,
government  agency,  self-regulatory  organization  or body  pending  or, to the
knowledge  of the  Company  or any of its  Subsidiaries,  threatened  against or
affecting the Company or any of its Subsidiaries, or their officers or directors
in their capacity as such, that could have a Material  Adverse Effect.  SCHEDULE
3(j)  contains  a  complete  list and  summary  description  of any  pending  or
threatened   proceeding   against  or  affecting  the  Company  or  any  of  its
Subsidiaries, without regard to whether it would have a Material Adverse Effect.
The Company and its Subsidiaries are unaware of any facts or circumstances which
might give rise to any of the foregoing.

                  k. PATENTS, COPYRIGHTS, ETC.; YEAR 2000 COMPLIANCE.

                       (i) The  Company  and  each of its  Subsidiaries  owns or
possesses  the  requisite  licenses  or  rights  to  use  all  patents,   patent
applications,  patent rights, inventions,  know-how, trade secrets,  trademarks,
trademark applications, service marks, service names, trade names and copyrights
("INTELLECTUAL  PROPERTY") necessary to enable it to conduct its business as now
operated (and,  except as set forth in SCHEDULE 3(k) hereof,  to the best of the
Company's  knowledge,  as presently  contemplated to be operated in the future);
there is no claim or action by any person pertaining to, or proceeding  pending,
or to the Company's  knowledge  threatened,  which  challenges  the right of the
Company or of a Subsidiary with respect to any Intellectual  Property  necessary
to enable it to conduct its business as now operated  (and,  except as set forth
in SCHEDULE 3(k) hereof,  to the best of the Company's  knowledge,  as presently
contemplated  to be  operated  in the  future);  to the  best  of the  Company's
knowledge,  the Company's or its  Subsidiaries'  current and intended  products,
services and  processes do not  infringe on any  Intellectual  Property or other
rights  held  by any  person;  and  the  Company  is  unaware  of any  facts  or
circumstances  which  might give rise to any of the  foregoing.  The Company and
each of its Subsidiaries have taken reasonable  security measures to protect the
secrecy, confidentiality and value of their Intellectual Property.

                       (ii) All of the Company's  computer software and computer
hardware,  and other  similar or related  items of  automated,  computerized  or
software systems that are used or relied on by the Company in the conduct of its
business or that were, or currently  are being,  sold or licensed by the Company
to customers (collectively,  "INFORMATION TECHNOLOGY"), are Year 2000 Compliant,
except  for any such  failure  to be Year 2000  Compliant  that would not have a
Material  Adverse Effect.  For purposes of this  Agreement,  the term "YEAR 2000
COMPLIANT" means, with respect to the Company's Information Technology, that the
Information  Technology  is designed  to be used prior to,  during and after the
calendar Year 2000 A.D., and the  Information  Technology  used during each such
time  period will  accurately  receive,  provide and process  date and time data
(including,  but not limited to,  calculating,  comparing and sequencing)  from,
into and between the 20th and 21st centuries, including the years 1999 and 2000,
and leap-year  calculations,  and will not  malfunction,  cease to function,  or
provide  invalid

<PAGE>

or  incorrect  results as a result of the date or time data,  to the extent that
other  information   technology,   used  in  combination  with  the  Information
Technology,  properly  exchanges  date and time data with it.  The  Company  has
delivered to the Buyer true and correct copies of all analyses, reports, studies
and  similar  written  information,  whether  prepared by the Company or another
party, relating to whether the Information Technology is Year 2000 Compliant.

                  l. NO MATERIALLY ADVERSE  CONTRACTS,  ETC. Neither the Company
nor any of its Subsidiaries is subject to any charter,  corporate or other legal
restriction,  or any judgment,  decree,  order,  rule or regulation which in the
judgment of the  Company's  officers  has or is expected in the future to have a
Material  Adverse Effect.  Neither the Company nor any of its  Subsidiaries is a
party to any  contract  or  agreement  which in the  judgment  of the  Company's
officers has or is expected to have a Material Adverse Effect.

                  m. TAX  STATUS.  Except as set  forth on  SCHEDULE  3(m),  the
Company and each of its  Subsidiaries  has made or filed all federal,  state and
foreign income and all other tax returns,  reports and declarations  required by
any  jurisdiction to which it is subject (unless and only to the extent that the
Company  and each of its  Subsidiaries  has set  aside on its  books  provisions
reasonably  adequate for the payment of all unpaid and unreported taxes) and has
paid all taxes and other governmental  assessments and charges that are material
in  amount,  shown  or  determined  to be  due  on  such  returns,  reports  and
declarations,  except those being contested in good faith,  and has set aside on
its  books  provisions  reasonably  adequate  for the  payment  of all taxes for
periods subsequent to the periods to which such returns, reports or declarations
apply.  Except as set forth on SCHEDULE  3(m),  there are no unpaid taxes in any
material amount claimed to be due by the taxing  authority of any  jurisdiction,
and the officers of the Company know of no basis for any such claim. The Company
has not executed a waiver with respect to the statute of limitations relating to
the assessment or collection of any foreign, federal, state or local tax. Except
as set forth on SCHEDULE  3(m),  none of the  Company's tax returns is presently
being audited by any taxing authority.

                  n. CERTAIN TRANSACTIONS.  Except as set forth on SCHEDULE 3(n)
and except for arm's length transactions pursuant to which the Company or any of
its Subsidiaries makes payments in the ordinary course of business upon terms no
less  favorable  than the Company or any of its  Subsidiaries  could obtain from
third  parties and other than the grant of stock  options  disclosed on SCHEDULE
3(c), none of the officers,  directors, or employees of the Company is presently
a party to any transaction  with the Company or any of its  Subsidiaries  (other
than for services as employees, officers and directors), including any contract,
agreement or other  arrangement  providing for the  furnishing of services to or
by,  providing for rental of real or personal  property to or from, or otherwise
requiring payments to or from any officer,  director or such employee or, to the
knowledge of the Company, any corporation, partnership, trust or other entity in
which any officer,  director, or any such employee has a substantial interest or
is an officer, director, trustee or partner.

                  o. DISCLOSURE.  All information  relating to or concerning the
Company or any of its  Subsidiaries  set forth in this Agreement and provided to
the Buyers  pursuant to Section 2(d) hereof and otherwise in connection with the
transactions  contemplated  hereby is true and correct in all material  respects
and the Company has not omitted to state any material fact necessary in order to
make the statements made herein or therein,  in light of the circumstances under
which they were made, not misleading.  No event or circumstance  has occurred or
exists with  respect to the Company or any of its  Subsidiaries  or its or their
business,

<PAGE>

properties,  prospects,  operations or financial conditions,  which has not been
publicly  announced or disclosed but, under  applicable law, rule or regulation,
requires public  disclosure or  announcement  by the Company  (assuming for this
purpose  that  the  Company's  reports  filed  under  the  1934  Act  are  being
incorporated into an effective registration statement filed by the Company under
the 1933 Act).

                  p.  ACKNOWLEDGMENT  REGARDING  BUYERS' PURCHASE OF SECURITIES.
The Company  acknowledges  and agrees  that the Buyers are acting  solely in the
capacity of arm's  length  purchasers  with  respect to this  Agreement  and the
transactions contemplated hereby. The Company further acknowledges that no Buyer
is acting as a financial  advisor or fiduciary of the Company (or in any similar
capacity)  with  respect to this  Agreement  and the  transactions  contemplated
hereby  and  that any  statement  made by any  Buyer or any of their  respective
representatives or agents in connection with this Agreement and the transactions
contemplated  hereby is not advice or a recommendation  and is merely incidental
to the Buyers'  purchase of the  Securities  and,  except for any such statement
included in this Agreement or the Registration  Rights  Agreement,  has not been
relied upon by the  Company,  its  officers  or its  directors  in any way.  The
Company  further  represents to each Buyer that the Company's  decision to enter
into this Agreement has been based solely on the  independent  evaluation of the
Company and its representatives.

                  q. NO INTEGRATED OFFERING. Neither the Company, nor any of its
affiliates,  nor any  person  acting on its or their  behalf,  has  directly  or
indirectly  made any offers or sales of any security or solicited  any offers to
buy any security under  circumstances that would require  registration under the
1933 Act of the issuance of the  Securities  to the Buyers.  The issuance of the
Securities to the Buyers will not be integrated  with any other  issuance of the
Company's  securities (past,  current or future) for purposes of any stockholder
approval provisions applicable to the Company or its securities,  except for the
issuance of the Series P Preferred  Stock and warrants (the "SERIES P WARRANTS")
issued  pursuant to the Series P Agreement and the issuance of Common Stock upon
conversion  of the Series P  Preferred  Stock and upon  exercise of the Series P
Warrants.

                  r. NO BROKERS.  The  Company  has taken no action  which would
give rise to any claim by any person  (except for Gerard Klauer  Mattison & Co.,
Inc.) for brokerage  commissions,  finder's fees or similar payments relating to
this Agreement or the  transactions  contemplated  hereby.  Prior to the date of
this  Agreement,  the Company has furnished to the Buyers a complete and correct
copy of the  agreement  dated  December  1, 1999  between the Company and Gerard
Klauer  Mattison & Co.,  Inc.  pursuant  to which such firm will be  entitled to
payment relating to the transactions contemplated by this Agreement.

                  s.   PERMITS;   COMPLIANCE.   The  Company  and  each  of  its
Subsidiaries  is  in  possession  of  all  franchises,  grants,  authorizations,
licenses, permits, easements,  variances,  exemptions,  consents,  certificates,
approvals and orders  necessary to own,  lease and operate its properties and to
carry on its business as it is now being conducted  (collectively,  the "COMPANY
PERMITS"), except where the failure to possess any such Company Permit would not
have a  Material  Adverse  Effect,  and  there is no action  pending  or, to the
knowledge of the Company, threatened regarding suspension or cancellation of any
of the  Company  Permits,  except  for any such  action  that  would  not have a
Material  Adverse Effect.  Neither the Company nor any of its Subsidiaries is in
conflict with, or in default or violation of, any of the Company Permits, except
for any such  conflicts,  defaults or violations  which,  individually or in the
aggregate,  would not

<PAGE>

reasonably be expected to have a Material  Adverse  Effect.  Since  December 31,
1998,  neither  the  Company  nor  any  of its  Subsidiaries  has  received  any
notification  with  respect to possible  conflicts,  defaults or  violations  of
applicable laws, except for notices relating to possible conflicts,  defaults or
violations,  which  conflicts,  defaults or violations would not have a Material
Adverse Effect.

                  t. ENVIRONMENTAL MATTERS.

                       (i) Except as set forth in SCHEDULE  3(t),  there are, to
the Company's knowledge,  with respect to the Company or any of its Subsidiaries
or  any  predecessor  of  the  Company,   no  past  or  present   violations  of
Environmental  Laws  (as  defined  below),  releases  of any  material  into the
environment, actions, activities, circumstances,  conditions, events, incidents,
or contractual  obligations  which may give rise to any common law environmental
liability  or any  liability  under the  Comprehensive  Environmental  Response,
Compensation  and  Liability  Act of 1980 or similar  federal,  state,  local or
foreign  laws and neither the Company nor any of its  Subsidiaries  has received
any notice with respect to any of the  foregoing,  nor is any action pending or,
to the Company's knowledge,  threatened in connection with any of the foregoing.
The term  "ENVIRONMENTAL  LAWS" means all federal,  state, local or foreign laws
relating  to  pollution  or  protection  of  human  health  or  the  environment
(including,  without limitation,  ambient air, surface water, groundwater,  land
surface or subsurface strata),  including,  without limitation, laws relating to
emissions,  discharges, releases or threatened releases of chemicals, pollutants
contaminants,   or  toxic  or  hazardous  substances  or  wastes  (collectively,
"HAZARDOUS  MATERIALS")  into the  environment,  or  otherwise  relating  to the
manufacture,   processing,  distribution,  use,  treatment,  storage,  disposal,
transport or handling of  Hazardous  Materials,  as well as all  authorizations,
codes, decrees,  demands or demand letters,  injunctions,  judgments,  licenses,
notices  or  notice  letters,  orders,  permits,  plans or  regulations  issued,
entered, promulgated or approved thereunder.

                       (ii) Other than  those that are or were  stored,  used or
disposed of in  compliance  with  applicable  law, no  Hazardous  Materials  are
contained on or about any real property  currently  owned, or to the best of the
Company's  knowledge leased or used, by the Company or any of its  Subsidiaries,
and  no  Hazardous  Materials  were  released  on or  about  any  real  property
previously  owned, or to the Company's  knowledge leased or used, by the Company
or any of its Subsidiaries  during the period the property was owned,  leased or
used by the Company or any of its  Subsidiaries,  except in the normal course of
the Company's or any of its Subsidiaries' business.

                       (iii) Except as set forth in Schedule 3(t),  there are no
underground  storage  tanks  on or  under  any real  property  owned,  or to the
Company's  knowledge  leased or used, by the Company or any of its  Subsidiaries
that are not in compliance with applicable law.

                  u. TITLE TO PROPERTY.  The Company and its  Subsidiaries  have
good and  marketable  title in fee  simple  to all  real  property  and good and
marketable title to all personal property owned by them which is material to the
business of the Company and its Subsidiaries, in each case free and clear of all
liens, encumbrances and defects except such as are described in SCHEDULE 3(u) or
such as  would  not have a  Material  Adverse  Effect.  Any  real  property  and
facilities held under lease by the Company and its Subsidiaries are held by them


<PAGE>

under valid, subsisting and enforceable leases with such exceptions as would not
have a Material Adverse Effect.

                  v.  INSURANCE.  The Company and each of its  Subsidiaries  are
insured by insurers of recognized financial  responsibility  against such losses
and risks and in such  amounts  as  management  of the  Company  believes  to be
prudent  and  customary  in  the   businesses  in  which  the  Company  and  its
Subsidiaries  are engaged.  Neither the Company nor any such  Subsidiary has any
reason  to  believe  that it will not be able to renew  its  existing  insurance
coverage as and when such coverage  expires or to obtain  similar  coverage from
similar  insurers as may be  necessary  to continue  its business at a cost that
would not have a Material Adverse Effect.

                  w. INTERNAL ACCOUNTING  CONTROLS.  The Company and each of its
Subsidiaries  maintain a system of internal accounting controls  sufficient,  in
the  judgment  of the  Company's  board  of  directors,  to  provide  reasonable
assurance that (i)  transactions  are executed in accordance  with  management's
general or specific authorizations,  (ii) transactions are recorded as necessary
to permit  preparation  of financial  statements  in conformity  with  generally
accepted  accounting  principles  and to maintain  asset  accountability,  (iii)
access to assets is permitted only in accordance  with  management's  general or
specific  authorization  and (iv) the  recorded  accountability  for  assets  is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.

                  x. FOREIGN CORRUPT PRACTICES.  Neither the Company, nor any of
its Subsidiaries,  nor any director,  officer,  agent,  employee or other person
acting on behalf of the  Company  or any  Subsidiary  has,  in the course of his
actions  for, or on behalf of, the  Company,  used any  corporate  funds for any
unlawful contribution,  gift,  entertainment or other unlawful expenses relating
to  political  activity;  made any direct or  indirect  unlawful  payment to any
foreign or  domestic  government  official  or employee  from  corporate  funds;
violated  or is in  violation  of any  provision  of the  U.S.  Foreign  Corrupt
Practices Act of 1977 as amended; or made any bribe, rebate,  payoff,  influence
payment,  kickback  or  other  unlawful  payment  to  any  foreign  or  domestic
government official or employee.

                  y. SOLVENCY.  The Company (both before and after giving effect
to the transactions contemplated by this Agreement) is solvent (i.e., its assets
have a fair market  value in excess of the amount  required to pay its  probable
liabilities  on its  existing  debts as they become  absolute  and  matured) and
currently  the  Company  has no  information  that would  lead it to  reasonably
conclude  that the Company  would not have the ability to, nor does it intend to
take any action  that would  impair its  ability  to, pay its debts from time to
time incurred in connection  therewith as such debts mature. The Company did not
receive a qualified  opinion from its  auditors  with respect to its most recent
fiscal  year end and does not  anticipate  or know of any basis  upon  which its
auditors might issue a qualified opinion in respect of its current fiscal year.

                  z. NO  INVESTMENT  COMPANY.  The Company is not,  and upon the
issuance and sale of the  Securities as  contemplated  by this Agreement and the
Certificate of Designation  will not be an "investment  company"  required to be
registered under the Investment  Company Act of 1940 (an "INVESTMENT  COMPANY").
The Company is not controlled by an Investment Company.
<PAGE>

                  aa. FORM S-1 ELIGIBILITY. The Company is currently eligible to
register the resale of its Common Stock on a registration  statement on Form S-1
under the 1933 Act. There exist no facts or circumstances that would prohibit or
delay the  preparation  and filing of a registration  statement on Form S-1 with
respect to the  Registrable  Securities  (as defined in the  Registration  Right
Agreement) within the time periods referred to therein.

         4. COVENANTS.

                  a. BEST  EFFORTS.  The parties shall use their best efforts to
satisfy  timely  each of the  conditions  described  in  Section 6 and 7 of this
Agreement.

                  b. FORM D; BLUE SKY LAWS.  The Company agrees to file a Form D
with respect to the Securities as required  under  Regulation D and to provide a
copy thereof to each Buyer promptly after such filing.  The Company shall, on or
before the Closing Date in respect of the First Closing, take such action as the
Company shall  reasonably  determine is necessary to qualify the  Securities for
sale to the Buyers at the Closing  pursuant to this Agreement  under  applicable
securities  or "blue sky" laws of the states of the United  States (or to obtain
an exemption from such  qualification),  and shall provide  evidence of any such
action so taken to each Buyer on or prior to the Closing  Date in respect of the
First Closing.

                  c. ELIGIBILITY TO USE FORM S-1;  Reporting Status. The Company
represents and warrants that it meets the  requirements  for the use of Form S-1
for  registration  of the sale by the Buyer of the  Registrable  Securities  (as
defined in the Registration Rights Agreement). So long as the Buyer beneficially
owns any of the Securities,  the Company shall timely file all reports  required
to be filed with the SEC  pursuant to the 1934 Act,  and the  Company  shall not
terminate  its status as an issuer  required to file reports  under the 1934 Act
even if the 1934 Act or the rules and regulations  thereunder  would permit such
termination. The Company further agrees to file all reports required to be filed
by the Company  with the SEC in a timely  manner so as to become  eligible,  and
thereafter  to maintain  its  eligibility,  for the use of Form S-3. The Company
agrees  that it will  file with the SEC a  Current  Report  on Form  8-K,  or an
amendment to the Current Report on Form 8-K filed by the Company on February 15,
2000, within three (3) business days of the Closing Date in respect of the First
Closing,  which filing will  include as exhibits all of the material  agreements
and instruments  relating to the transactions  contemplated  hereby to which the
Company is a party.

                  d. USE OF PROCEEDS.  The Company  shall use the proceeds  from
the sale of the  Preferred  Shares  in the  manner  set forth in  SCHEDULE  4(d)
attached  hereto and made a part  hereof  and,  except as set forth in  SCHEDULE
4(d),  shall not,  directly or indirectly,  use such proceeds for any loan to or
investment  in any other  corporation,  partnership,  enterprise or other person
(except  in  connection   with  its  currently   existing   direct  or  indirect
Subsidiaries).

                  e. ADDITIONAL EQUITY CAPITAL; RIGHT OF FIRST OFFER. Subject to
the exceptions  described below, the Company will not, without the prior written
consent of a majority-in-interest of the Buyers,  negotiate or contract with any
party to obtain additional equity or equity-equivalent financing (including debt
financing  with an equity  component)  during the period (the "LOCK-UP  PERIOD")
beginning on the Closing Date in respect of the First  Closing and ending on the
date  which is one  hundred  twenty  (120)  days from the date the  Registration
Statement  (as  defined  in  the  Registration  Rights  Agreement)  is  declared
effective (plus any days in which sales cannot be made thereunder). In addition,
subject to the  exceptions  described

<PAGE>

below,  if the Company  wishes to obtain equity or  equity-equivalent  financing
(including debt financing with an equity component) ("FUTURE FINANCINGS") during
the period  beginning  on the Closing  Date in respect of the First  Closing and
ending  twelve (12) months  following  the date the  Registration  Statement  is
declared effective (plus any days in which sales cannot be made thereunder),  it
shall first deliver to each Buyer,  at least fifteen (15) business days prior to
offering  such Future  Financing to any other Person (as defined in Article IV.B
of the  Certificate  of  Designation),  written  notice  describing the proposed
Future  Financing,  including the terms and conditions  thereof,  and the Buyers
shall have the exclusive right to negotiate,  and the Company shall negotiate in
good faith with the Buyers, during the ten (10) day period following delivery of
such  notice,  to provide  such  Future  Financing  on terms  acceptable  to the
Company;  provided,  however,  that if the  Company and the Buyers are unable to
agree on such terms  during such  period,  the  Company  shall have the right to
negotiate  and contract  with any other Person to obtain such Future  Financing,
provided that the terms of such Future  Financing  are no less  favorable to the
Company  than those terms  proposed  in such  written  notice  (the  limitations
referred  to in  this  sentence  and the  preceding  sentence  are  collectively
referred to as the "CAPITAL  RAISING  LIMITATIONS "). In the event the terms and
conditions of a proposed Future Financing are amended in any material respect on
terms which are less  favorable to the Company  after  delivery of the notice to
the Buyers concerning the proposed Future Financing, the Company shall deliver a
new notice to each Buyer  describing  the amended  terms and  conditions  of the
proposed  Future  Financing and each Buyer  thereafter  shall have the exclusive
right  during the ten (10) day period  following  delivery of such new notice to
provide such Future Financing on the same terms as contemplated by such proposed
Future Financing,  as amended.  The foregoing sentence shall apply to successive
amendments to the terms and  conditions of any proposed  Future  Financing.  The
Capital Raising  Limitations shall not apply to any transaction  involving:  (i)
issuances  of  securities  in a firm  commitment  underwritten  public  offering
(excluding a continuous  offering  pursuant to Rule 415 under the 1933 Act);  or
(ii) issuances of securities as  consideration  for a merger,  consolidation  or
purchase of assets,  or in connection  with any strategic  partnership  or joint
venture (the primary  purpose of which is not to raise  equity  capital),  or in
connection with the disposition or acquisition of a business,  product, asset or
license by the Company.  The Capital Raising Limitations also shall not apply to
the issuance of securities upon exercise or conversion of the Company's options,
warrants or other convertible securities outstanding as of the date hereof or to
the grant of  additional  options or  warrants,  or the  issuance of  additional
securities,  under any Company stock option,  restricted stock or other employee
benefit plan approved by the stockholders of the Company.

                  f.  EXPENSES.  The Company shall  reimburse  Rose Glen Capital
Management,  L.P.  ("ROSE GLEN") for all reasonable  expenses  incurred by it in
connection  with  the   negotiation,   preparation,   execution,   delivery  and
performance  of this  Agreement  and the  other  agreements  to be  executed  in
connection herewith, including, without limitation,  attorneys' and consultants'
fees and expenses and travel  expenses.  The  Company's  obligation to reimburse
Rose  Glen's  expenses  under  this  Section  4(f)  shall be  limited to Fifteen
Thousand Dollars ($15,000).

                  g.  FINANCIAL  INFORMATION.  The  Company  agrees  to send the
following  reports to each Buyer until such Buyer transfers,  assigns,  or sells
all of the  Securities:  (i) within ten (10) business days after the filing with
the SEC, a copy of its Annual Report on Form 10-K, its Quarterly Reports on Form
10-Q and any Current Reports on Form 8-K; (ii) within one (1) business day after
release,  copies  of all press  releases  issued  by the  Company  or any of its
Subsidiaries; and (iii) contemporaneously with the making available or giving to
the

<PAGE>

stockholders  of the  Company,  copies of any notices or other  information  the
Company makes available or gives to such stockholders.

                  h.  RESERVATION  OF  SHARES.  The  Company  shall use its best
efforts at all times to maintain the number of shares of Common  Stock  reserved
for issuance upon  conversion  of the Preferred  Shares and upon exercise of the
Warrants at no less than 4,000,000 shares;  provided that, in the event that the
Company  delivers  the Share  Limit  Waiver (as  defined in the  Certificate  of
Designation),  the Company will  promptly  take all action  necessary to reserve
additional shares of Common Stock in accordance with its obligations  hereunder,
and the Company shall at all times thereafter have authorized,  and reserved for
the  purpose  of  issuance,  a  sufficient  number of shares of Common  Stock to
provide for the full  conversion  of the  outstanding  Preferred  Shares and the
issuance of the Conversion  Shares in connection  therewith (based on the lesser
of the Variable  Conversion Price (as defined in the Certificate of Designation)
in effect  from time to time and the Fixed  Conversion  Price (as defined in the
Certificate  of  Designation)  in effect  from  time to time)  and as  otherwise
required by the Certificate of Designation and the full exercise of the Warrants
and the issuance of the Warrant  Shares in  connection  therewith  (based on the
exercise  price of the Warrants in effect from time to time).  The Company shall
not reduce the  number of shares of Common  Stock  reserved  for  issuance  upon
conversion of or otherwise pursuant to the Preferred Shares and upon exercise of
or otherwise pursuant to the Warrants without the consent of each Buyer. Subject
to the first  sentence of this Section 4(h), if at any time the number of shares
of Common  Stock  authorized  and  reserved  for issuance is below the number of
Conversion  Shares issued and issuable upon conversion of or otherwise  pursuant
to the Preferred Shares (based on the lesser of the Variable Conversion Price in
effect from time to time and the Fixed  Conversion  Price in effect from time to
time (each as  defined in the  Certificate  of  Designation))  and the number of
Warrant  Shares issued and issuable  upon  exercise of or otherwise  pursuant to
Warrants  (based on the  exercise  price of the  Warrants in effect from time to
time),  the  Company  will  promptly  take all  corporate  action  necessary  to
authorize  and  reserve  a  sufficient  number  of  shares,  including,  without
limitation,  calling a special meeting of  stockholders to authorize  additional
shares to meet the Company's obligations under this Section 4(h), in the case of
an  insufficient  number of  authorized  shares,  and using its best  efforts to
obtain stockholder approval of an increase in such authorized number of shares.

                  i. LISTING.  The Company shall promptly  secure the listing of
the  Conversion  Shares and the  Warrant  Shares upon each  national  securities
exchange or  automated  quotation  system,  if any,  upon which shares of Common
Stock are then listed  (subject to official  notice of issuance) and, so long as
any Buyer owns any of the Securities shall maintain, so long as any other shares
of Common Stock shall be so listed,  such listing of all Conversion  Shares from
time to time issuable upon conversion of or otherwise  pursuant to the Preferred
Shares  and  Warrant  Shares  from time to time  issuable  upon  exercise  of or
otherwise pursuant to the Warrants.  The Company will obtain and, so long as any
Buyer owns any of the Securities, maintain the listing and trading of its Common
Stock on Nasdaq,  the Nasdaq SmallCap Market ("NASDAQ  SMALLCAP"),  the New York
Stock  Exchange  ("NYSE"),  or the  American  Stock  Exchange (" AMEX") and will
comply in all material respects with the Company's  reporting,  filing and other
obligations under the bylaws or rules of the National  Association of Securities
Dealers ("NASD") and such exchanges,  as applicable.  The Company shall promptly
provide to each Buyer  copies of any  notices it  receives  from  Nasdaq and any
other  exchanges or  quotation  systems on which the Common Stock is then listed
regarding  the  continued  eligibility  of the Common  Stock for listing on such
exchanges and quotation systems.
<PAGE>

                  j. CORPORATE  EXISTENCE.  So long as a Buyer beneficially owns
any Preferred  Shares,  the Company shall  maintain its corporate  existence and
shall not merge,  consolidate or sell all or substantially  all of the Company's
assets,  except  in the  event of a merger  or  consolidation  or sale of all or
substantially all of the Company's assets,  where (i) the surviving or successor
entity (and, if an entity different from the surviving or successor entity,  the
entity whose securities into which the Preferred Shares shall become convertible
pursuant  to  Article  VI.C(b)  of  the  Certificate  of  Designation)  in  such
transaction assumes the Company's obligations hereunder and under the agreements
and instruments entered into in connection herewith (provided,  however, that in
the case of a merger or  consolidation in which the Company is not the surviving
entity  and in which  all of the  outstanding  shares  of  capital  stock of the
Company  are  being  acquired  for  or  converted  into  the  right  to  receive
consideration  consisting  entirely of cash,  then the  successor  or  surviving
entity (if not the Company) shall not be obligated to assume the  obligations of
the Company under the  Certificate of  Designation,  except for the  obligations
under Article IV.B thereof), and (ii) any entity whose securities into which the
Preferred  Shares shall become  convertible  pursuant to Article  VI.C(b) of the
Certificate of Designation is a publicly traded  corporation  whose Common Stock
is listed for trading on Nasdaq, Nasdaq SmallCap, NYSE or AMEX.

                  k. NO  INTEGRATION.  The Company  shall not make any offers or
sales of any security (other than the Securities) under circumstances that would
require registration of the Securities being offered or sold hereunder under the
1933 Act or cause the offering of  Securities  to be  integrated  with any other
offering  of  securities  by the  Company  for the  purpose  of any  stockholder
approval provision applicable to the Company or its securities.

                  l.  TRADING  GUIDELINES.  So long as a Buyer  holds  Preferred
Shares, such Buyer covenants and agrees that it will conduct its sales of Common
Stock in  compliance  with  applicable  securities  laws and will not create any
daily low trading price in the Common Stock.

                  m.  CERTIFICATES  OF  ELIMINATION.  The Company shall promptly
file  Certificates  of  Elimination  with the Secretary of State of the State of
Delaware with respect to each series of its outstanding preferred stock which is
fully  converted  by the holders  thereof or  redeemed by the Company  upon such
conversion or redemption.

                  n. STOCKHOLDER APPROVAL. Unless the Company otherwise receives
written  guidance from Nasdaq in substance and scope  satisfactory to the Buyers
(the  "NON-INTEGRATION  LETTER") that the issuance of Securities pursuant hereto
and pursuant to the terms of the  Certificate  of  Designation  and the Warrants
will not be integrated  with the issuance of the Series P Preferred  Stock,  the
Series P Warrants and the shares of Common Stock  issuable upon  conversion  and
exercise of, or otherwise with respect to, the Series P Preferred  Stock and the
Series P Warrants  for  purposes of Nasdaq  rules  (including  Rule  4460),  the
Company shall, at its next annual meeting of stockholders  which will be held on
or prior to July 31, 2000,  obtain such approvals of the Company's  stockholders
as may be  required  to issue all of the shares of Common  Stock  issuable  upon
conversion and exercise of, or otherwise with respect to, the Preferred  Shares,
the  Warrants  and the  shares of  Series P  Preferred  Stock  and the  Series P
Warrants in accordance  with  applicable  law and the rules and  regulations  of
Nasdaq (including Rule 4460) (the "20% RULE APPROVAL"). The Company shall comply
with the filing and  disclosure  requirements  of Section 14 under the  Exchange
Act,  and  the  rules  and  regulations

<PAGE>

thereunder, in connection with the solicitation,  acquisition and the disclosure
of the 20% Rule Approval.  The Company represents and warrants that its Board of
Directors  has approved,  and will  recommend  that the  Company's  stockholders
approve,  the proposal  contemplated  by this Section 4(n) and shall so indicate
such  recommendation  in the  proxy  statement  used to  solicit  the  20%  Rule
Approval.  The  Company  shall use its best  efforts to cause its  officers  and
directors to vote in favor of the proposal contemplated by this Section 4(n).

         5. TRANSFER  AGENT  INSTRUCTIONS.  The Company shall issue  irrevocable
instructions to its transfer agent to issue certificates, registered in the name
of each Buyer or its nominee,  for the Conversion  Shares and the Warrant Shares
in such amounts as specified from time to time by each Buyer to the Company upon
conversion  of the  Preferred  Shares or exercise of the Warrants in  accordance
with the terms thereof (the "IRREVOCABLE TRANSFER AGENT INSTRUCTIONS"). Prior to
registration of the Conversion  Shares and the Warrant Shares under the 1933 Act
or the date on which the  Conversion  Shares and the Warrant  Shares may be sold
pursuant to Rule 144 without any  restriction  as to the number of securities as
of a particular  date that can then be immediately  sold, all such  certificates
shall bear the restrictive  legend  specified in Section 2(g) of this Agreement.
The Company  warrants that no instruction  other than the  Irrevocable  Transfer
Agent Instructions referred to in this Section 5, and stop transfer instructions
to give effect to Section 2(f) hereof (in the case of the Conversion  Shares and
the Warrant  Shares,  prior to  registration  of the  Conversion  Shares and the
Warrant Shares under the 1933 Act or the date on which the Conversion Shares and
the Warrant  Shares may be sold pursuant to Rule 144 without any  restriction as
to the number of securities as of a particular date that can then be immediately
sold),  will be  given  by the  Company  to its  transfer  agent  and  that  the
Securities  shall  otherwise be freely  transferable on the books and records of
the Company as and to the extent provided in this Agreement and the Registration
Rights  Agreement.  Nothing in this Section  shall affect in any way the Buyer's
obligations  and  agreement  set forth in Section 2(g) hereof to comply with all
applicable  securities laws and prospectus delivery  requirements,  if any, upon
re-sale of the  Securities.  If a Buyer provides the Company with (i) an opinion
of counsel,  in form,  substance and scope  customary for opinions in comparable
transactions,  to the effect that a public  sale or transfer of such  Securities
may be made without registration under the 1933 Act and such sale or transfer is
effected or (ii) the Buyer provides  reasonable  assurances  that the Securities
can be sold pursuant to Rule 144, the Company shall permit the transfer, and, in
the case of the Conversion Shares and the Warrant Shares,  promptly instruct its
transfer  agent to issue one or more  certificates,  free  from any  restrictive
legend,  in such name and in such  denominations  as specified by such Buyer.

         6.  CONDITIONS TO THE COMPANY'S  OBLIGATION TO SELL.  The obligation of
the Company  hereunder to issue and sell the Preferred  Shares and Warrants to a
Buyer at each of the First  Closing  and the  Second  Closing  is subject to the
satisfaction,  at or before  the  Closing  Date in  respect  of such  applicable
Closing,  of each of the  following  conditions  thereto,  provided  that  these
conditions  are for the Company's  sole benefit and may be waived by the Company
at any time in its sole discretion:

                  a. With respect to the First Closing and the Second Closing:

                       (i)  The  applicable   Buyer  shall  have  executed  this
Agreement and the  Registration  Rights  Agreement and delivered the same to the
Company.

                       (ii)  The  applicable  Buyer  shall  have  delivered  the
applicable Purchase Price in accordance with Section 1(b) above.


<PAGE>

                       (iii) The  Certificate  of  Designation  shall  have been
accepted for filing with the Secretary of State of the State of Delaware.

                       (iv) The representations and warranties of the applicable
Buyer  shall be true and  correct in all  material  respects as of the date when
made and as of the  applicable  Closing Date as though made at that time (except
for  representations  and  warranties  that speak as of a specific  date,  which
representations  and warranties  shall be true and correct as of such date), and
the  applicable  Buyer  shall have  performed,  satisfied  and  complied  in all
material respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by the applicable Buyer at
or prior to the applicable Closing Date.

                       (v) No litigation,  statute, rule, regulation,  executive
order,  decree,   ruling  or  injunction  shall  have  been  enacted,   entered,
promulgated  or  endorsed  by or in  any  court  or  governmental  authority  of
competent jurisdiction or any self-regulatory organization having authority over
the matters  contemplated  hereby which prohibits the consummation of any of the
transactions contemplated by this Agreement.

         7. CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE. The obligation of
each Buyer  hereunder to purchase the Preferred  Shares and the Warrants at each
of the First Closing and the Second Closing is subject to the  satisfaction,  at
or before the Closing Date in respect of such applicable Closing, of each of the
following  conditions,  provided that these conditions are for such Buyer's sole
benefit and may be waived by such Buyer at any time in its sole discretion:

                  a. With respect to the First Closing and the Second Closing:

                       (i) The Company shall have  executed  this  Agreement and
the Registration Rights Agreement and delivered the same to the Buyer.

                       (ii) The Company shall have  delivered to such Buyer duly
executed  certificates  (in  such  denominations  as the  Buyer  shall  request)
representing the Preferred Shares and duly executed  Warrants  purchased at such
applicable Closing in accordance with Section 1(b) above.

                       (iii) The  Certificate  of  Designation  shall  have been
accepted for filing with the Secretary of State of the State of Delaware,  and a
copy thereof  certified by such  Secretary of State shall have been delivered to
such Buyer.

                       (iv) The Irrevocable Transfer Agent Instructions, in form
and substance satisfactory to a  majority-in-interest  of the Buyers, shall have
been delivered to and acknowledged in writing by the Company's Transfer Agent.

                       (v) The  representations  and  warranties  of the Company
shall be true and correct in all material  respects as of the date when made and
as of the  applicable  Closing  Date as  though  made at such time  (except  for
representations  and  warranties  that  speak  as  of  a  specific  date,  which
representations  and  warranties  shall be true and correct as of such date) and
the  Company  shall have  performed,  satisfied  and  complied  in all  material
respects  with  the  covenants,  agreements  and  conditions  required  by  this
Agreement to be performed, satisfied or

<PAGE>

complied with by the Company at or prior to the  applicable  Closing  Date.  The
Buyer shall have received a certificate or  certificates,  executed by the chief
executive  officer or chief  financial  officer of the Company,  dated as of the
applicable Closing Date, to the foregoing effect and as to such other matters as
may be  reasonably  requested  by  such  Buyer  including,  but not  limited  to
certificates with respect to the Company's Certificate of Incorporation, By-laws
and Board of Directors'  resolutions  relating to the transactions  contemplated
hereby.

                       (vi) No litigation, statute, rule, regulation,  executive
order,  decree,   ruling  or  injunction  shall  have  been  enacted,   entered,
promulgated  or  endorsed  by or in  any  court  or  governmental  authority  of
competent jurisdiction or any self-regulatory organization having authority over
the matters  contemplated  hereby which prohibits the consummation of any of the
transactions contemplated by this Agreement.

                       (vii) The Conversion  Shares and the Warrant Shares shall
have been  authorized  for  listing on Nasdaq  (subject  to  official  notice of
issuance)  and  trading  in the  Common  Stock on  Nasdaq  shall  not have  been
suspended by the SEC or Nasdaq.

                       (viii) The Buyer  shall have  received  an opinion of the
Company's  counsel,  dated as of the applicable Closing Date, in form, scope and
substance  reasonably  satisfactory to the Buyer and in  substantially  the same
form as Exhibit "D" attached hereto.

                       (ix)  The  Buyer  shall  have   received   an   officer's
certificate  described in Section 3(c) above, dated as of the applicable Closing
Date.

                       (x) No  material  adverse  change or  development  in the
business, operations,  properties,  prospects, financial condition or operations
of the Company  shall have  occurred  since the date  hereof;  provided  that no
decrease  in the  trading  price of the Common  Stock on Nasdaq  shall in and to
itself be considered to be such a material adverse change or development.

                       (xi)  The  Company  's  Series  A, B, C, D, G, H, K and N
preferred  stock shall have been converted or eliminated and the] only remaining
series of preferred stock authorized and/or outstanding shall be Series E, F, I,
J, L, M, O and P preferred stock.

                       (xii) The proposed  merger  between the Company and Trans
Global Communications, Inc. shall not have been abandoned, canceled, terminated,
or the terms thereof  materially  altered (in a manner materially adverse to the
Company) from those previously publicly announced, nor shall there have been any
public announcement that such merger may not be consummated.

                  b. With respect to the Second Closing:

                       (i)  The  Registration   Statement  (as  defined  in  the
Registration  Rights  Agreement)  registering  the  resale by the  Buyers of the
shares of Common Stock  issuable upon  conversion  and exercise of, or otherwise
with respect to, the  Preferred  Shares,  the  Warrants,  the Series P Preferred
Stock and the Series P Warrants in accordance with the terms of the Registration
Rights Agreement and that certain  Registration  Rights  Agreement,  dated as of


<PAGE>

January 26, 2000,  by and among the Company and the other  signatories  thereto,
shall  have been  declared  effective  and no stop order  shall  have  issued in
respect thereof.

         8. GOVERNING LAW; MISCELLANEOUS.

                  a.  GOVERNING  LAW.  This  Agreement  shall be governed by and
construed in  accordance  with the laws of the State of Delaware  applicable  to
agreements made and to be performed in the State of Delaware  (without regard to
principles  of  conflict  of  laws).  The  parties  irrevocably  consent  to the
jurisdiction of the United States federal courts and the state courts located in
Delaware with respect to any suit or  proceeding  based on or arising under this
Agreement,   the  agreements   entered  into  in  connection   herewith  or  the
transactions  contemplated  hereby or  thereby  and  irrevocably  agree that all
claims in respect of such suit or  proceeding  may be determined in such courts.
The  parties  irrevocably  waive the  defense  of an  inconvenient  forum to the
maintenance of such suit or proceeding.  The parties  further agree that service
of  process  upon a party  mailed by first  class  mail shall be deemed in every
respect  effective  service  of  process  upon the  party  in any  such  suit or
proceeding. Nothing herein shall affect either party's right to serve process in
any other manner permitted by law. The parties agree that a final non-appealable
judgment in any such suit or proceeding  shall be conclusive and may be enforced
in other jurisdictions by suit on such judgment or in any other lawful manner.

                  b. COUNTERPARTS;  SIGNATURES BY FACSIMILE.  This Agreement may
be executed in one or more  counterparts,  all of which shall be considered  one
and the same agreement and shall become  effective when  counterparts  have been
signed by each party and  delivered to the other  party.  This  Agreement,  once
executed by a party,  may be delivered to the other parties  hereto by facsimile
transmission  of a copy of this Agreement  bearing the signature of the party so
delivering this Agreement.

                  c.   HEADINGS.   The  headings  of  this   Agreement  are  for
convenience   of   reference   and  shall  not  form  part  of,  or  affect  the
interpretation of, this Agreement.

                  d.  SEVERABILITY.  If any provision of this Agreement shall be
invalid   or   unenforceable   in   any   jurisdiction,   such   invalidity   or
unenforceability  shall  not  affect  the  validity  or  enforceability  of  the
remainder of this Agreement or the validity or  enforceability of this Agreement
in any other jurisdiction.

                  e.  ENTIRE  AGREEMENT;  AMENDMENTS.  This  Agreement  and  the
instruments  referenced  herein contain the entire  understanding of the parties
with  respect  to  the  matters  covered  herein  and  therein  and,  except  as
specifically  set forth  herein or  therein,  neither  the Company nor the Buyer
makes any representation, warranty, covenant or undertaking with respect to such
matters.  No provision of this  Agreement may be waived or amended other than by
an instrument in writing signed by the party to be charged with enforcement.

                  f.  NOTICES.  Any notices  required or  permitted  to be given
under the terms of this Agreement  shall be sent by certified or registered mail
(return receipt  requested) or delivered  personally or by courier  (including a
recognized  overnight  delivery  service) or by facsimile and shall be effective
five days after being  placed in the mail,  if mailed by regular  United  States
mail,  or upon  receipt,  if  delivered  personally  or by courier  (including a
recognized  overnight delivery service) or by facsimile,  in each case addressed
to a party. The addresses for such communications shall be:
<PAGE>

                    If to the Company:

                    eGlobe, Inc.
                    1250 24th Street, NW
                    Suite 725
                    Washington, DC 20037
                    Attention: Chairman of the Board and Chief Executive Officer
                    Facsimile: (202) 822-8984

                    With copy to:

                    Hogan & Hartson L.L.P
                    Columbia Square
                    555 13th Street, NW
                    Washington, DC 20004-1109
                    Attention: Steven M. Kaufman, Esq.
                    Facsimile: (202) 637-5910

                  If to a Buyer: To the address set forth immediately below such
Buyer's name on the signature pages hereto.

                           With copy to:

                    Ballard Spahr Andrews & Ingersoll, LLP
                    1735 Market Street, 51st Floor
                    Philadelphia, Pennsylvania 19103
                    Attention: Gerald J. Guarcini, Esq.
                    Facsimile: (215) 864-8999

                  Each  party  shall  provide  notice to the other  party of any
change in address.

                  g.  SUCCESSORS AND ASSIGNS.  This  Agreement  shall be binding
upon and inure to the benefit of the parties and their  successors  and assigns.
Neither the Company nor any Buyer shall  assign this  Agreement or any rights or
obligations   hereunder   without  the  prior  written  consent  of  the  other.
Notwithstanding the foregoing, subject to Section 2(f), any Buyer may assign its
rights  hereunder to (i) any of its  "affiliates," as that term is defined under
the  1934 Act and  (ii)  any  person  that  purchases  Securities  in a  private
transaction from a Buyer, without the consent of the Company.

                  h. THIRD PARTY  BENEFICIARIES.  This Agreement is intended for
the benefit of the parties hereto and their respective  permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other person.

                  i. SURVIVAL. The representations and warranties of the Company
and the Buyers and the agreements and covenants set forth in Sections 2, 3, 4, 5
and 8 shall  survive the closings  hereunder  notwithstanding  any due diligence
investigation  conducted  by or on  behalf of the  Company  or the  Buyers.  The
Company  agrees to indemnify  and hold harmless

<PAGE>

each of the Buyers and all their officers,  directors,  employees and agents for
loss or damage arising as a result of or related to any breach or alleged breach
by the Company of any of its representations, warranties and covenants set forth
in Sections 3 and 4 hereof or any of its  covenants and  obligations  under this
Agreement  or  the  Registration  Rights  Agreement,  including  advancement  of
expenses as they are incurred. Each Buyer agrees,  severally and not jointly, to
indemnify and hold harmless the Company and its officers,  directors,  employees
and agents for loss or damage arising as a result of or related to any breach or
alleged  breach  by such  Buyer of any of its  representations,  warranties  and
covenants  set  forth in  Sections  2 and 4 hereof or any of its  covenants  and
obligations under this Agreement,  including advancement of expenses as they are
incurred.

                  j.  PUBLICITY.  The Company and each of the Buyers  shall have
the right to review a  reasonable  period of time  before  issuance of any press
releases,  filings with the SEC, the NASD or any stock  exchange or  interdealer
quotation   system,   or  any  other  public  statements  with  respect  to  the
transactions  contemplated hereby; provided,  however, that the Company shall be
entitled,  without the prior  approval of each of the Buyers,  to make any press
release or public  filings with respect to such  transactions  as is required by
applicable law and  regulations  (although each of the Buyers shall be consulted
by the Company in  connection  with any such press  release prior to its release
and shall be provided with a copy thereof and be given an opportunity to comment
thereon).

                  k. FURTHER  ASSURANCES.  Each party shall do and  perform,  or
cause to be done and  performed,  all such  further  acts and things,  and shall
execute and deliver all such other  agreements,  certificates,  instruments  and
documents,  as the other party may reasonably  request in order to carry out the
intent and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

                  l. NO STRICT CONSTRUCTION. The language used in this Agreement
will be deemed to be the language  chosen by the parties to express their mutual
intent, and no rules of strict construction will be applied against any party.

                  m. REMEDIES.  The Company  acknowledges that a breach by it of
its obligations hereunder will cause irreparable harm to each Buyer by vitiating
the intent and purpose of the transactions contemplated hereby. Accordingly, the
Company  acknowledges  that the  remedy at law for a breach  of its  obligations
under this Agreement will be inadequate and agrees,  in the event of a breach or
threatened breach by the Company of the provisions of this Agreement,  that each
Buyer shall be entitled,  in addition to all other available  remedies in law or
in equity,  to an injunction or  injunctions  to prevent or cure any breaches of
the  provisions  of this  Agreement  and to enforce  specifically  the terms and
provisions of this Agreement, without the necessity of showing economic loss and
without any bond or other security being required.


                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

         IN WITNESS WHEREOF,  the undersigned Buyers and the Company have caused
this Agreement to be duly executed as of the date first above written.

EGLOBE, INC.
<PAGE>


By:
         Christopher J. Vizas
         Chairman of the Board and Chief Executive Officer

RGC INTERNATIONAL INVESTORS, LDC

By:      Rose Glen Capital Management, L.P.,
         Investment Manager
         By:      RGC General Partner Corp.,
                  as General Partner


By:
         Wayne D. Bloch
         Managing Director

RESIDENCE:  Cayman Islands

ADDRESS:

         c/o Rose Glen Capital Management, L.P.
         3 Bala Plaza East, Suite 200
         251 St. Asaphs Road
         Bala Cynwyd, PA  19004
         Facsimile:        (610) 617-0570
         Telephone:        (610) 617-5900

AGGREGATE SUBSCRIPTION AMOUNT:

First Closing
     Number of Preferred Shares:                                           4,000
     Number of First Closing Warrants:                                   100,000
     Aggregate Purchase Price:                                        $4,000,000

Second Closing
Number of Preferred Shares:                                                6,000
Number of Second Closing Warrants:                                       150,000
Aggregate Purchase Price:                                             $6,000,000